Checking in with Crypto on a Snow Day

You know the Home Alone sequel where the negligent (bordering on abusive) parents leave Kevin in New York City? It really idealized what NYC might look like during or after a blizzard. If that film were realistic in any way it would depict the big Apple as a slushy disgusting mess, where the snow isn’t white but takes on a dirty asphalt color. Not that I’m complaining, that weird pigeon grey reminds me of home. Actually, come to think of it, if that film were more realistic it wouldn’t exist, since CPS would have taken the child away from the family before a sequel could have been made. I digress, but this is what snow days are all about; working from home while having movies playing on basic cable in the background for ambient noise, and treading down mental alleyways about the fictional McCallister family — and my other favorite topic: Crypto. Here are some snow day crypto thoughts and links:

1. Tether is at it again! Observers of blockchain transactions report the issuance of $300 million worth of USDT token, the first new issuance of USDT since mid-February. I can already hear Tether critics pointing to the billowing smoke coming from this story and yelling FIRE!!! Not that they would be wrong in doing so, since Bitfinex has denied any wrongdoing while being shady about audits to a ridiculous extent. Tether is like that friend of yours that’s constantly in the middle of drama but claims to be totally easy going and drama free. Still though, I’ve been tracking this issue since the December subpoenas waiting for the other shoe to drop, and I must say that with some time having gone by I haven’t seen much from the “kill Tether” crowd other than inference, circumstantial evidence and half-baked correlations between USDT print runs and crypto prices. Don’t get me wrong, these things have moved the needle enough for me to not be caught dead holding a Tether, but is it OK yet to say I’m exhausted by all the hand wringing? Shut down Tether and/or Bitfinex or don’t, I’m moving on. I’m thinking about who can create a better stablecoin for the crypto market because after 4 months of watching this story I’m back to square one where I just don’t think USDT is even a good idea to begin with. The benefits of a good stablecoin are clear, but why peg a crypto to the US Dollar? Isn’t a major feature of borderless crypto money that it isn’t centralized and controlled by a Central Bank or Federal Reserve that requires it’s users (citizens) to trust it? The premise is that money supply should be totally transparent with rules laid out from the get-go, and managed by cold hard math that is inherently trustless. Bittrex recently listed TrueUSD (TUSD) onto it’s exchange, but it seems like little more than Tether with better auditing. I think I’m moving towards the belief that the best stablecoin solution is one that isn’t pegged to an existing fiat currency, or non-pegged as described by those projects trying it. In this type of coin, price is dictated by a real time balancing of token supply with it’s demand. How to manage that balancing act is the tricky part. Please weigh in on the pegged vs. non-pegged stablecoin concept on my twitter @Uncrypt_Vlad. Also, if you’re going to research the topic, please don’t Google pegging. Trust me.
2. Twitter and Square CEO Jack Dorsey goes on record to say that within ten years time Bitcoin will overtake the dollar and become the single global currency of the internet. Well shit, I sure hope so. The idea of a borderless payment system featuring a currency that is not governed by any State or Government is what attracted me to the crypto space to begin with. That ought to be an option for people, in tandem with existing monetary structures. Kudos to people like Jack Dorsey, world-class entrepreneurs who have the means to advance such a concept towards reality in ten years. Having said that, I’ll also pour myself a shot of tequila to enjoy as I take this story with several coarse grains of salt. The CEO of Square has a lot of very good reasons (the fiat kind) to cheer for Bitcoin becoming the single currency of the internet. Square is adopting Bitcoin payments into their offering and pursuing Money Transmitter Licenses around the country to be able to facilitate Bitcoin payments. Also, apologies for the paywall link. If you want to read more about this story, please check the the twitter @everybitcoinmaximalistever.
3. Cointelegraph on South Korea and the ongoing saga of ICO regulations in the Asian peninsula. You know what? I’m not even going to comment on the content of the article. If I’m going to dismiss negative rumors and wait for actual regulations (as I’ve soapboxed on this blog before), then it’s only honest to dismiss positive sounding rumors until I can read some actual legislation or code from this country. I mean seriously, I’m sorry to post shitty links on my own blog, but this is an illustrative example. The article even quotes unnamed sources unironically. Sigh. Call me when I can read an official government statement on the matter. Actually, also call someone who can translate Korean.
4. I ran into Michael Casey at TokenFest as he was leaving to catch a flight and I was just walking into the building. Bummer that I didn’t get a chance to get my copy of The Truth Machine signed. This article he posted today at Coindesk is a 100% must read, and I won’t do him the injustice of paraphrasing any of it here. Just click through and go read it. What I will say is that it left me with a good 30 minute think about the public use-cases of the internet that made it so attractive and adaptable to the world at large in the mid 90’s, and all the reasons for “why then.” After all, the internet in some form or another had been in use by government and big business for many years prior to that. And now, how about cryptocurrency? The hackneyed and least thought-out argument I hear from skeptics is “blockchain, not Bitcoin!” Well, I agree, non-tokenized blockchains in some form or another have been in use by governments and big business for quite some time in an effort to clean up back-end and internal payment structures. But something has to be driving all of this current mania for crypto. The great use case for blockchain, transmitting value across the internet in a totally secure, immutable and auditable way, is made publically available via Bitcoin and clearly serves a huge demand. So, what’s the 90's-era equivalent of blockchain, not Bitcoin? Is it “internet, not E-mail!” Or perhaps “internet, not navigational search!” The Blockchain, not Bitcoin! thing is a disaster. It implies that world changing technologies should be reserved for the large institutions that got to play with them first, that it’s not for everyone and the public facing element is fleeting. How hipster. There’s obviously a credible and compelling public use case for cryptocurrency. To not acknowledge that is to be blind to the demand and implications of major companies like Square (and hundreds of well funded startups) figuring out how to help people use, spend, store, lend, borrow and convert their crypto…All rendering this laziest of the skeptic arguments invalid. Sure, maybe Bitcoin and crypto at large is in the midst of a huge bubble (or the burst of one), but more interesting is “why now?” Why now for the crypto-mania that launched this bubble and the flood of ICO’s riding the wave?

By the way, none of the above rambling has anything to do with Casey’s article about the cryptocurrency bubble. But that’s what the great writers do, get you thinking into long and deep tangents on a sleepy grey snow day in New York City.