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| December 17, 2018

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10 State Names, Deciphered

December 13, 2018 |

You need look no further than a map to find America’s reputation as a melting pot. The evidence is written across the states—specifically in their names, according to 24/7 Wall St. , which surveyed state websites and online resources to trace the origins of those names to England, France, Spain,…
Newser

Report: BTC Gets a Health Check in ‘The State of Bitcoin’

December 11, 2018 |

Report: BTC Gets a Health Check in “The State of Bitcoin”

Delphi Digital has taken a deep dive into bitcoin core in its first “The State of Bitcoin” report. The 59-page document from the digital asset investment company leaves no stone unturned, covering everything from BTC payments to coin distribution and rolling returns compared to stocks and gold. The report brings together a plethora of interesting statistics that attest to bitcoin’s growing evolution and adoption.

Also read: Fundraiser Aims to Raise $ 1M in Cryptocurrencies for Venezuelans

Better Understanding Bitcoin

Few people, save for a handful of terminal haters and discredited economists, dispute that Bitcoin is valuable. But quite where that value lies, and what the primary purpose of Satoshi’s creation should be, is a matter of some dispute. “In its current state, BTC is easier to dismiss than understand,” acknowledge the authors of The State of Bitcoin. “We believe the primary long-term value drivers for BTC revolve around its ability to serve as 1) a censorship-resistant store of value and 2) a ‘check’ on governments as an alternative, country-agnostic digital reserve currency.”

Report: BTC Gets a Health Check in ‘The State of Bitcoin’The report itself offers something for everyone, addressing BTC’s current deployment as both a medium of exchange and a store of value. Delphi Digital devotes particular attention to charting BTC’s progress in the countries that need it most – inflation-hit Argentina and Venezuela. Here, as well as in regions where many of the world’s unbanked can be found – primarily Africa – cryptocurrencies have huge potential. The report identifies three primary drivers behind BTC adoption in these countries:

  • As an alternative to local currencies suffering from high or hyperinflation
  • Allowing citizens to hold their wealth directly, rather than trust a local bank
  • To improve the speed and reduce transaction fees of sending remittances

Report: BTC Gets a Health Check in ‘The State of Bitcoin’The average cost of remittance for sending $ 200 is as high as $ 36 between South Africa and Botswana, for example, showing significant scope for cryptocurrencies to provide a low-cost alternative. But BTC’s use cases don’t end there. “In the past, when high inflation took hold in a person’s country, there was little that they could do except watch as their purchasing power evaporated,” continues the report. Now, “any person with internet access has the option to insulate themselves from local currency risk by switching to [BTC]. Essentially, bitcoin can offer a check on government power and policy while providing a vital safe haven for people from all around the world.”

Divining Trends Through UTXO Analysis

Examining unspent transaction outputs (UTXOs) offers up clues as to the market cycle that BTC is currently enduring, and hints at what may come next. Delphi Digital has used a green line to represent UTXOs that are at least a year old – i.e. coins that haven’t been spent in over a year. Monitoring the percentage of 1yr+ UTXOs, as part of BTC’s entire UTXO set, shows when bitcoin holders begin to move their coins once more, be it to sell, trade, or purchase goods and services. “In the second half of 2018, the 1-Year UTXO band began exhibiting a positive growth trajectory directly in tandem with the 1-2 Year band as older UTXO bands remain flat,” reads the report. “We believe we are in the midst of an accumulation process taking similar to the one in the 2nd half of 2014.”

Report: BTC Gets a Health Check in ‘The State of Bitcoin’
The black line represents the price of BTC on a logarithmic scale and the green line shows the percent of bitcoin UTXOs that have not been used in a transaction in at least a year

For those searching desperately for signs of a market recovery, one of the key takeaways from the report, based primarily on UTXO analysis, is that “Bitcoin may face additional selling pressure in the near-term, but we believe prices will bottom in Q1 2019 based on our analysis of holder dynamics during prior boom-bust cycles.”

From Banks to the Unbanked, Bitcoin Is for Everyone

Much of Bitcoin’s beauty lies in the fact that it can be many things to many people. While it can provide a lifeline to citizens suffering from hyperinflation or prone to having their assets seized by despotic governments, BTC can be equally valuable to governments themselves, central banks, and the so-called one percent. “There is a case to be made for central banks to hold a small portion of bitcoin in their reserves as a complement to gold if it matures into an accepted store of value,” ventures the report. It continues:

If the ~$ 1.4 trillion of gold reserves held by central banks grows at a similarly modest 2% rate per year, the expected value of bitcoin would be roughly $ 10,000 assuming a 25% chance it captures half the total value of future gold reserves … The upside potential for bitcoin is immense assuming it captures even a modest portion of the total assets held in offshore bank accounts, the investible gold market, and central bank gold reserves.

While it’s easy to speculate future use cases and users of bitcoin, what’s indisputable is that BTC is unlike any monetary system that’s gone before. Even now, 10 years on from the Bitcoin whitepaper, new applications for BTC are being discovered. It would take a brave soul to bet against bitcoin being worth more and transacted more 10 years from now.

Do you think it’s likely that BTC will start to recover from Q1 of 2019? Let us know in the comments section below.


Images courtesy of Shutterstock and Delphi Digital


Need to calculate your bitcoin holdings? Check our tools section.

The post Report: BTC Gets a Health Check in ‘The State of Bitcoin’ appeared first on Bitcoin News.

Bitcoin News

Iraq marks anniversary of victory over Islamic State

December 10, 2018 |

Iraq on Monday celebrated the anniversary of its costly victory over the Islamic State group, which has lost virtually all the territory it once held but still carries out sporadic attacks.
FOX News

California officially becomes first state to require solar panels on new homes

December 7, 2018 |

California became the first state in the nation to require homes built in 2020 and later be solar-powered, following a vote by the Building Standards Commission.

The unanimous action Wednesday finalized a previous vote by the Energy Commission and brings the state closer to fulfilling a decade-old…


L.A. Times – Business

Miss America’s Purge of State Leaders Widens

December 5, 2018 |

The Miss America Organization has widened its purge of state officials who have opposed the national leadership, terminating the licenses of New Jersey, New York and Florida. So far, eight states could have their pageant leadership replaced. The AP obtained revocation letters from two of the states and confirmed with…
Newser

TMZ

George H.W. Bush’s State Funeral Draws White House, Congress and SCOTUS Luminaries

December 3, 2018 |

George H.W. Bush is being honored by Washington, D.C.’s biggest power players — past and present — as a week-long memorial gets underway. The State Funeral for our 41st President was held Monday in the Capitol Rotunda and the attendees…

TMZ.com

Wendy McElroy: Don’t Smash the State, Bypass the State

December 1, 2018 |

Don’t Smash the State, Bypass the State

The Satoshi Revolution: A Revolution of Rising Expectations
Section 5: Saving the World Through Anarchism
Chapter 11, Part 7
Crypto Justice: Don’t Smash the State, Bypass the State.

The 19th century individualist-anarchist Benjamin Tucker referred to anarchism as “society by contract.” The contracts could express any exchange, from leases to prostitution, from insurance policies to drug deals. The contracts would not be legal or illegal, only consensual. Just as crypto bypasses central banking and decentralizes economic control down to the individual, smart contracts have the potential of bypassing much of the legal system and returning to the people’s law—contract law. But, like crypto, the contracts would not require a trusted third party.

– Wendy McElroy, “How the Blockchain Provides Private Justice”

Last week’s installment of The Satoshi Revolution was entitled “How the Blockchain Provides Private Justice.” It examined a key argument used to counter the possibility of libertarian or private law. In summary: for justice to function, the content and administration of justice needs to be widely accepted, and that acceptance is based on the system being considered legitimate. The legitimacy is deemed to rest on consensus—on the judgment arrived at by most of those concerned–not on individual choice. This means the administration of justice must be centralized and homogenized by an agency that enjoys consensus because such an agency enjoys the compliance, if not the respect, of society. The preceding dynamic requires the state. When neither obedience nor respect are present, then the justice system commands compliance through the institutionalized violence of law enforcement.


The Parallels of Crypto and Justice

The argument for fiat and against crypto is remarkably similar. In order to function, it is claimed, a currency needs to be widely accepted, and this happens only when the public views it as legitimate. A consensus is necessary. The logic: a currency must be issued by an agency that enjoys public support and can command compliance in the form of acceptance. If the “consensus currency” is not used voluntarily or if it suffers from competition, then its use can be compelled by institutionalized force, such as legal tender laws. Again, this requires the state.

This line of reasoning is invalid for currency; it is invalid for justice. Crypto proved that individual consent coupled with an instrument of administration—the blockchain—can create a currency that others accept. The currency needs only the  consent of users, not a broader consensus, and compliance with the blockchain is an automatic matter.

The consensus argument for both currency and justice is more than invalid, however. It is deeply dishonest. For one thing, it is a contradiction in terms. If the administration and acceptance of a “service” relies upon force, then the service is not widely viewed as legitimate; it is widely opposed.

The argument also contains several sleights of hand or sleights of concept. One is how consent and consensus are presented. Consent is equated with legitimacy. This sounds reasonable because, on a personal level, it is. Consent and legitimacy are cause and effect when discussing a person’s willingness to engage in an exchange; a marriage becomes legitimate by saying “I do.” But the legitimacy argument takes a sharp turn when it introduces consensus. At this point, legitimacy is no longer based on individual consent but upon a collective agreement in which individual consent is democratized; the majority wins. The individual loses. As the political satirist P.J. O’Rourke stated “bipartisan consensus. Those are the two most frightening words in Washington. Bipartisan consensus is like when my doctor and my lawyer agree with my wife that I need help.”

The consensus argument rests on geography. Because communities are geographically defined, it is assumed that geographically-homogeneous laws must exist, and they are usually established by some form of majority rule. Binding elections result in politicians—that is, people empowered by consensus—who pass laws that apply to every individual, for example, whether the individual consents or not.

What happens when geography does not define a community and its institutions? Crypto answered this question in at least one area: currency.  Money is no longer restricted to the fiat issued by jurisdictions, which flows through the physical choke points called banks. Crypto decentralizes currency and bypasses the geography of the state.  The key to private law and justice is the same as the key to money: remove the trusted third party by decentralizing control down to the individual.


Private Justice

Justice occurs when everyone receives what they deserve. Libertarian or private law consists of the rules necessary to achieve this end.

The most persuasive theorist on private law may well be the libertarian Randy Barnett, who teaches legal theory and contracts at Georgetown University. In his book The Structure of Liberty, Barnett contends that the adjudication and enforcement of law should be privately administered, with inefficiencies addressed by the free market; an example of the latter in crypto is the emergence of decentralized exchanges to handle conversion problems. Barnett argues that private law is the solution to the corrupting influence that vested interests and power will inevitably exert upon justice.

Private law is incredibly simple compared to modern models. Barnett writes, “Every dollar spent to punish a drug user or seller is a dollar that cannot be spent collecting restitution from a robber. Every hour spent investigating a drug user or seller is an hour that could have been used to find a missing child. Every trial held to prosecute a drug user or seller is court time that could be used to prosecute a rapist.” Libertarian law is contract law. And as the iconic Murray Rothbard wrote, “It is not the business of the law to make anyone good or reverent or moral or clean or upright.” Law should make people whole.

(Note: how contract law could handle fraud and other acts of aggression will be addressed in subsequent installments. This installment deals with exchange.)

Private law requires two things: voluntary interaction and an instrument of enforcement. Again, the voluntary interaction is the contract, which is not restricted to the economic exchange. There is no aspect of human contact that agreement—implied, verbal, or written–cannot govern.

The obstacle over which theories of private law have stumbled is the instrument of enforcement. For one thing, it invites the participation of a trusted third party. The third party in private law would be a free market one and, presumably, it would be restrained by dynamics like the desire to preserve a good reputation. But any model of law that is dependent upon a trusted third party is vulnerable to corruption, incompetence, and other risk factors. The more dependent it is, the more vulnerable it becomes.

The genius of Satoshi Nakamoto was to remove the trusted third party problem from economic exchanges, but the blockchain’s potential extends much further. It has profound implications for contract law.

Some of the Blockchain’s Implications for Contract Law

A transfer on the blockchain is a simplistic peer-to-peer contract, which memorializes the terms for those involved and is seen to be valid by the surrounding community through transparency. It is a voluntary exchange. The blockchain is also an instrument of enforcement that embodies the terms of execution, such as irreversibility, to which both parties have agreed; their agreement is expressed through the willingness to use the blockchain. Thus the blockchain expresses both requirements of libertarian law; it facilitates voluntary interaction and it acts as an instrument of enforcement.

When law is reduced to contracts and their execution, then the code is the law, literally. This sounds simplistic because it expresses the simplicity of private law.

But the peer-to-peer and one-off exchanges offered by the blockchain has limited value for societies that require complexities such as ongoing contracts for rent. That’s where smart contracts (discussed in the previous installment) come into play. The self-executing contracts allow individuals to escape the blockchain’s limitations by setting their own additional terms for an exchange and its enforcement, including provisions for default. Smart contracts are in a primitive stage of development right now, but their social and political significance are clear. They decentralize law down to the individual level by personalizing the terms of agreement and eliminating the need for a third party instrument of enforcement.

This paradigm of law is free of geography, which makes it free of the perceived need for consensus. The blockchain erases borders as it carries the contract that is consent into every jurisdiction of the world. The implications of this are immense.

If every exchange defines and executes its own version of law, and if justice consists of each person receiving what he deserves, then people can code their own version of what is just and many visions of “justice” can exist and self-execute in parallel and peace. One person might conduct daily life through contracts that express Western common law. His Orthodox Jewish neighbor may prefer contracts that embody Hasidic law. Another neighbor may be a communist. If justice is decentralized down to the individual, then rampant diversity is not only possible but also inevitable. In other words, a free market in justice.

The code is not only the law, it is also justice.

The need for law enforcement, attorneys, and arbitrators would not be eliminated, but it would be so reduced as to become invisible to most people. The need would not be eliminated because it is still necessary to address not merely the operation of daily life but also the break down of daily life: acts of fraud and other violence.

[To be continued.]

Reprints of this article should credit bitcoin.com and include a link back to the original links to all previous chapters


Wendy McElroy has agreed to ”live-publish” her new book The Satoshi Revolution exclusively with Bitcoin.com. Every Saturday you’ll find another installment in a series of posts planned to conclude after about 18 months. Altogether they’ll make up her new book ”The Satoshi Revolution”. Read it here first.

The post Wendy McElroy: Don’t Smash the State, Bypass the State appeared first on Bitcoin News.

Bitcoin News

Nearly Half of Young Adults Live at Home in This State

November 29, 2018 |

Adults in New Jersey might be less embarrassed than most to utter the words, “I live with my parents.” That’s because the state hosts a higher percentage of young adults living with one or two parents than any other state in the country, per North Jersey Record , which surveyed census…
Newser

He’ll Play for Kent State, in What’s an NCAA First

November 29, 2018 |

Kalin Bennett is 6-foot-10, weighs 300 pounds, and has proven to be a force on the basketball court throughout his high school playing days in Little Rock, Ark. No surprise, then, that he’s signed a letter of intent to play Division I basketball with Kent State. But as Cleveland.com…
Newser

Chatter Report: Buy Walls, Miner Anonymity and Bitcoin vs. the State

November 29, 2018 |

Buy Walls, Miner Anonymity and bitcoin vs the State

In today’s edition of Chatter Report, crypto influencers debate the importance of buy walls to support crypto prices, reason for and against miner anonymity and ponder the outcome of governments attacking bitcoin.

Also read: Markets Update: Bull Trap or Reversal? Traders Question the Recent Crypto Spike

Hodlers of Last Resort and Buy Walls

Chatter Report: Buy Walls, Miner Anonymity and Bitcoin vs. the State

Early bitcoin adopter and investor in Kraken, Trace Mayer, argues that crypto market capitalizations are important, but not as important as the hodlers of last resort and “buy support.” Mayer reasons that the combination of investors who don’t panic sell their coins and buy orders that are reflected in order books are what keep crypto prices from sliding further down.

Chatter Report: Buy Walls, Miner Anonymity and Bitcoin vs. the State

However, Eric Wall argues that this is incorrect, because buy and sell orders are just an illusion. The cryptocurrency lead at Cinnober reasons that buy walls can be pulled quickly when market sentiment turns bearish, so data on order books can’t really be trusted. Wall’s distrust of order books is also shared by others in the thread, as they point out that over-the-counter market orders are unseen and obscure buy and sell data even further.

Should Miners be Anonymous?

After Nchain proposed the Optimal Miner Pseudo ID, crypto Twitter erupted in a fiery debate over whether miners should be anonymous or have their identities publicly known.

Chatter Report: Buy Walls, Miner Anonymity and Bitcoin vs. the State

Developer Chris Pacia argues that all miners should be anonymous because anonymity makes it more difficult for governments to shut down bitcoin. On the other hand, prominent bitcoiner Alex Pickard believes that miners should be known by the public, as that would “increase trust in the system,” which is better for the bitcoin ecosystem.

The argument then shifted focus to the purpose of Proof of Work (POW), with crypto-Twitter regular Karate McAwesome arguing that POW is set up for miner anonymity.

Chatter Report: Buy Walls, Miner Anonymity and Bitcoin vs. the State

Pickard quickly disagreed, explaining that the point of POW is to prevent double spending and to maintain the fixed supply of bitcoin. He then elaborated, claiming that transparent miner identities could prevent the government from shutting bitcoin down.

Bitcoin vs. the State

Picking up on the idea of governments trying to destroy bitcoin, cryptocurrency proponent Chris G and Bitcoin Uncensored’s Chris DeRose began their own separate discussion. The former argued that bitcoin would benefit from the government trying to destroy it.

Chatter Report: Buy Walls, Miner Anonymity and Bitcoin vs. the State

G reasons that after the Chinese government tried to shut down bitcoin from 2013 to 2015, the subsequent years were fantastic for bitcoin prices. G goes on to draw parallels between bitcoin and Christianity, explaining that governments initially killed all Christians until Constantine figured out how he could benefit from the religion.

Throughout the thread, DeRose appears convinced of G’s arguments. By the end, both parties conclude that divisions in the bitcoin community are more dangerous than governments trying to destroy bitcoin.

What do you think of the significance of buy walls and hodlers to support crypto prices? Should miners be anonymous or known entities? Would governments attacking bitcoin actually be good for it? Let us know in the comments below.


Images courtesy of Shutterstock.


Need to know the price of bitcoin? Check this chart.

The post Chatter Report: Buy Walls, Miner Anonymity and Bitcoin vs. the State appeared first on Bitcoin News.

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