Timothy may of the crypt: in 1988 and now

Longreads

Timothy may — cryptographer and seropan, who recently agreed to comment on the white paper at the request of the bitcoin Coindesk. Reflections resulted in a 30-page document about the history of cryptocurrencies, and the role of government, the ideals of cryptography. Than the well-known Timothy may and what role it played in the formation of the movement Shirobokov, versed in our material.

90. the masked Men. Wired

In 1993, the cover of the January issue of Wired got three men in masks. It was Eric Hughes, a mathematician from the University of California at Berkeley and the author of «Manifest shirobana», John Gilmore, a specialist in computer science and one of the founders of non-profit human rights organization electronic frontier Foundation, and Timothy may, is a technical and political writer, who previously worked as an electrical engineer at Intel, the Creator of the mailing list Shirobokov and author of «Manifesto of the crypto-anarchist». The material Wired was called «Crypto rebels» («Crypto-Rebels»).

In September 1992, Hughes, Gilmore and Mae invited about 20 friends to the first meeting of the «physical Shirobokov» in Silicon valley. Subsequently, the meetings became monthly. The participants met in the company Gilmore Cygnus Solutions and discussed the issues of programming and cryptography. The name itself, the group received from one of the members of the hacker Jude Milhon: he combined the words «code» and «cyberpunk» (the sci-Fi genre).

«A Ghost lives in the modern world, the specter of crypto-anarchy…»

So begins the «Manifesto of the crypto-anarchist», written in may 1988 and is common among the «techno-anarchists» during the conference Crypto’88 and the Hackers Conference. Late may will read this Manifesto in the first meeting Shirobokov.

«Computer technology is on the verge of having to give people the opportunity to communicate and interact with each other completely anonymously. Two persons may exchange messages, conduct business and to enter into electronic contracts without even knowing the real name or the legal entity identifier of each other. The interaction in networks will be untraceable, due to large-scale rerouting encrypted packets and tamper-proof boxes that implement cryptographic protocols with nearly complete guarantee of newsuniversity. Reputation will be the main priority, much more important in trades than today’s credit ratings,» writes may.

All that is now apparent in kryptomere, position of controls, privacy, allegations of use of cryptocurrencies for illegal purchases and Dodge taxes, it was far from clear in 1988, 20 years before the advent of bitcoin. Nevertheless, even then, may very accurately described crypto-reality in its present form. «These developments will change the nature of government regulation, the ability to tax and control economic interactions, the ability to keep information secret, they will even alter the nature of trust and reputation,» said may.

Indeed, regulators have been actively engaged in cryptocurrency, and the desire to control a new industry emerged simultaneously with the beginning of «crypto rush» when bitcoin began to flow from his hands Shirobokov, developers and geeks in the hands of ordinary users. John Holmqvist, founder of Bitcoin Black Friday, called on 25 July 2017, «a solemn day» when the Commission on securities and exchange Commission (SEC) «has entered the crypto space.» Then the SEC published a report on the investigation into the hacking of the decentralized Fund and The DAO recognized the tokens DAO securities. «The report confirms that issuers of securities created on the blockchain, are required to register the offer and sale of such securities, except, subject to valid exemption from registration… Includes any individual investment transaction and sale of securities… depends on the specific facts and circumstances, including the economic characteristics of the transaction,» reads the official website SEC.

Since then on the issue of cryptocurrencies held several hearings in the Senate, the Chairman of the SEC, Jay Clayton spoke to students at Princeton, the SEC equated most ICO tokens to securities, requiring the organizers of the observance of the law on traditional securities, and sent out dozens of requests for information crypto-companies. And so act not only U.S. regulators everywhere and constantly crypto warn investors about the risks and introduce new rules and prohibitions.

As regards taxation, the IRS (IRS) has begun to regulate crypto-currencies in March 2014, and treats them as property, therefore, levying tax buying, selling, trading and mining cryptocurrencies. The struggle between the IRS and taxpayers continues, and the number reporting crypto-users is still small, but one of the big victories of the IRS was the partial results of the user data exchange Coinbase, which the regulator has achieved after months of trial.

«Keeping information secret», as predicted by the Mei, cryptocurrency is also really help. Although bitcoin is here already apparently lost, some private altcoins justify the confidence of their holders: right, monero passed the stress test last year, proving their privacy: then law enforcement are unable to figure out how many coins Monero was the owner of darknet site AlphaBay.

«The state will of course try to slow or stop the spread of this technology, citing national security issues, the use of technology by drug trafficking and those who are tax evaders, and fears of social disintegration. Many of these concerns will be established: crypto anarchy will allow you to freely trade in government secrets, and illegal and stolen goods. An anonymous computerized market will even make possible abhorrent markets for assassinations and extortion. Various criminal elements and foreigners will be active users of the crypto-network. But that will not stop the spread of crypto-anarchy,» writes may. Drug trafficking, sponsoring IG (banned in Russia organization), extortion — bitcoin has really opened up the way for many illegal activities, and the most notorious precedent was the darknet marketplace silk road. However, as predicted by the Mei, it does not stop crypto-car.

May also catch one of the main characteristics of the future of cryptocurrencies, namely: they will interfere with the banks, as they will be faster, cheaper and safer due to the lack of mediation: «just as the technology of printing altered and reduced the influence of medieval guilds and the structure of social power, cryptographic methods are fundamentally changing the nature of corporate and state intervention in economic transactions. Combined with emerging information markets, crypto anarchy will create a liquid market for any things that can be represented in words and images. And as seemingly insignificant invention of barbed wire made possible the delimitation of vast ranches and farms, forever changing ideas about land and the ownership of the Wild West, and seemingly insignificant discovery of the hidden branches of mathematics will become the clippers that will break the barbed wire from intellectual property».

«Get up, you have nothing to lose, except for the fences topped with barbed wire!» — so concludes the Manifesto may.

1988-2018: Mae on cryptocurrency 30 years later

Mae wrote a lot about cryptography, privacy and «crypto-anarchy» from late 80s to 2003. The decade of the bitcoin white paper (subscribers of the mailing list for cryptographers Metzdowd got the message Satoshi, which contained a link to a description of bitcoin, 31 Oct 2008), Coindesk asked may to write their thoughts about this document.

Mei said that watching the situation around bitcoin and other cryptocurrencies in the last 10 years is «little interest, little pleasure and with a strong disappointment».

Mei takes bitcoin one of the leading places in a number of financial achievements, calling him «perhaps the most important event since the invention of double-entry accounting». He notes that in some aspects of bitcoin to its initial description — it can be purchased or mined, you can quickly send with a small Commission, it is public (so-called permissionless system), does not require centralized intermediaries, and participating in the transaction, the parties don’t even have to trust each other. And, despite this, may called cryptocurrency «the tsunami that swept the financial world and left a lot of confusion and victims»: «I see is losing hundreds of millions because of errors in the code, theft, fraud, ICO, based on strange ideas, strange programming and too few talented people to implement ambitious plans… Satoshi did a great thing, but the story is far from over. She or he or it was even recognized that the version of bitcoin 2008 was not the final response received from the gods.»

It is already may notes the tragic divergence of the system from the initial idea of bitcoin: «I can’t say that I intended [to do] Satoshi, but I definitely don’t think this included the bitcoin exchange with draconian requirements for KYC and AML, with passports, freezing of accounts and the laws regarding reporting to the secret police [information] about «suspicious activity». There is a possibility that all this fuss about “control”, “control” and “blockchain” actually create a state of denunciation. I think Satoshi would throw up… We can finish the regulation of money transfers, which [represent] almost the same, that regulation [of freedom] words. This achievement? If Alice will not be allowed to say “I will gladly pay you a dollar next week for a cheeseburger today”, isn’t that a restriction of freedom of speech? «Know your customer» (KYC) may just as easily be applied to books and print: «know your reader»,» — so estimates may modern way «regulatory transparency» and compliance, which arose many of the players in the crypto-space.

May also refers to a broader historical context, trying to perform country and what form it might purchased in the new crypto era: «For some it is tempting to think that the legal protection and judicial oversight will stop the abuse… at least [I think so] in the United States and several other countries. We know that even the United States was seen in the draconian behavior (cleaning the Mormons, murder, and death marches for native Americans, the illegal imprisonment of suspects in the Japanese origin). What China and Iran do to «know your writers» (what will inevitably lead «know your customer»)?».

Why bitcoin?

Mei believes that the main characteristics that attracted him to the bitcoin original audience, was his lack of control power. «If the project was about something «relevant regulatory requirements», «banking-friendly», the interest would be small,» writes may, citing as example unnoticed and «bored to numbness of the brain» project SET — Secure Electronic Transfer — which was also dedicated to electronic transfers, but were «99% legally-compliant». Bitcoin was able to attract Shirobokov and, of course, the criminal audience, which, whatever high ideals of Ross Ulbricht, the kishila on his site «the silk road».

Regulation

«Inevitably will be some kind of contract with the legal systems of the United States or the rest of the world. Slogans like “code is law” is more idealistic than true. [But] by itself, bitcoin is largely independent of the law. Payments, in the nature of bitcoin is not subject to opinion like “I want to cancel this transaction” and other legal issues. This may change. But in today’s system, are generally unknown to those involved in the transaction, in which jurisdiction it is located, even what laws apply to it… I think almost all technologies have enabled ways to use that someone did not like. Gutenberg’s printing press, of course, did not like the Catholic Church. But does this mean that the printing presses must be licensed or regulated?» writes may.

Two roads

Today, a number of consortia, uniting banks and large financial institutions, is working on an exclusive (permissioned), private corporate blockchains. May, in principle, does not recognize this type of solutions, considering the availability (permissionless) one of the basic characteristics of decentralized systems: «the Tension between private (or anonymous) and KYC-approaches is a key issue. This “decentralization, anarchy and odnorangovoj” against “centralization, exclusivity (permissioned), and backdoor” (part of the algorithm, which allows the developer to gain unauthorized access to the data and control the system)… There are two roads: freedom vs. exclusive centralized system. This fork in the road was discussed at length some 25 years ago. The government and law enforcement actually did not mind: they had seen that the separation is approaching.»

Bitcoin is not PayPal second

Mae notes that the emphasis has long been on technology, with the result that too little attention was paid to the «ideological positioning» of cryptocurrencies, their place in the financial system: «Most academic cryptographers focused on the mathematics of cryptology: the view is not rotated in the direction of the financial aspects… Many of us are very interested in to bitcoin just became… yet another system for Bank transfers. What’s really exciting is the bypass control, huge commissions, intermediaries who decide whether it comes to donations to Wikileaks… trying to be “friendly regulator” is likely to kill most uses of cryptocurrency that is NOT just “another PayPal » or » Visa”. The enthusiasm around bitcoin started largely because of a bypass of control, because of the possibility of new and exotic ways to use the type of the silk road. It was cool and sharp, and not another PayPal».

Altcoins

Despite the fact that bitcoin, in may’s opinion, was not accurate, untainted embodiment of the ideas of Satoshi, «it basically does what was planned, it was supposed to do: the money can be transfer, store, even to use it as speculative tool.» Worse is the situation of «dozens of large [of cryptocurrency] and hundreds of smaller ones, for which it is difficult to find clear, understandable scenario»: «‘ll Get a «reputation token», «token attention», «charity tokens» — they all seem to me ill-conceived. And none of them took off like bitcoin».

In may’s opinion, an excessive amount of marketing around alternative cryptocurrencies did not accelerate their adoption: he believes that people don’t have the resources to accept such a quantity of information: «I think greed, hype and chatter around «Tu ze moon» and «hodl» is the biggest hype I’ve seen… He’s definitely more of what we saw in the dotcom era… Too much attention is paid to conference presentations, white paper’am and press releases. There are many “vending”… Huge number of small companies, large consortia, alternative cryptocurrencies, ICO, conferences, Expo’s, forks, new protocols create a lot of fuss, and while new conferences are held approximately every week, writes may, opposition to this process of advertising and the imposition of the advent of credit cards and bitcoin itself, which quite simply came to life without needing a massive PR campaign. — People can’t spend mental energy on reading technical documents coming out after weekly ads, noisy debate. The cost of the «mental transaction» too high».

Final thoughts

«Don’t use something just because it sounds cool. Use only if it really solves some problem (at the moment cryptocurrencies solve problems few people, at least in the first world)».

«Most of the things that we think of as problems are not solved by cryptocurrencies, or any other similar technology (the nonsense about «more convenient system of donations» is not what interested most people)».

«If someone is involved in a dangerous transaction [associated] with drugs, abortions, and use the intense «security operations». Remember how they caught Ross Ulbricht».

«Mathematics is not the law.»

«The crypt is still very far from the use of ordinary people (and even people with technical background)».

«Be interested in the freedom of transactions and words, to return to the original motivation. Don’t waste time trying to make regulatory appropriate financial alternatives».

«Remember, there are many tyrants».

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Bank of America joined blockchain consortium Marco Polo

Leading financial institution of the USA Bank of America joined the ranks of the blockchain of the Marco Polo consortium, which aims to improve the efficiency of international trade with the help of technology a distributed registry. This is stated in the message on the organization’s website.

Founded a startup and R3 FINTECH company TradeIX the consortium the Marco Polo offers its members a solution based on blockchain platform from Corda R3. Its main functions include monitoring of transactions in real time, transparency of processes and decrease the threshold of access to capital.

«We want to explore new technology from the point of view of increasing the transparency of transactions for our clients and make traditional paper processes more simple and efficient,» said Jeff Brady, head of global trade and financial supply chain Bank of America.

Other members of the network Marco Polo are BNP Paribas, Commerzbank, ING, LBBW, Anglo-Gulf Trade Bank, Standard Chartered Bank, Natixis, Bangkok Bank, SMBC, Danske Bank, NatWest, DNB, OP Financial Group, Alfa-Bank, Bradesco, BayernLB, Helaba, S-Servicepartner, Raiffeisen Bank International, Standard Bank, Credit Agricole and National Bank of Fujairah.

Earlier in September, the consortium was also joined by Mastercard. As stated by the representatives of the payment network, the b2b division of Mastercard Track will provide attendees Marco Polo point of access to working capital platforms.

The pilot phase was launched in February 2018, the first test transactions were conducted in March of this year, and in August, when the platform was successfully carried out the first real transaction for the sale and supply of hydraulic couplings from Germany to Taiwan.

It is noteworthy that earlier this year the chief technology officer of Bank of America’s Cathy Bessant said that the Corporation does not see the use of blockchain technology in the financial sector.


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In stores 7-Eleven in the Philippines have the opportunity to buy cryptocurrency

Provider of investment applications Abra announced the beginning of sales of bitcoin and other cryptocurrencies in 6000 retail outlets in the Philippines.

The project is implemented in partnership with a local payment company ECPay, which provided Abra access to its network of popular shops 7-Eleven.

Users of Abra purse can purchase bitcoin through a payment kiosk CLIQQ in the store or mobile app. The minimum purchase amount is 500 Philippine pesos (about $10) daily limit — 100 thousand pesos (about $1920). Per transaction fee is charged at 2%.

According to Abra, the digital wallet supports 30 and 50 Fiat currencies.

Earlier, Abra, in cooperation with the FINTECH-service Plaid added the ability to connect applications to accounts in American banks to buy cryptocurrency. However, due to the regulatory risks, the company has introduced a number of restrictions on transactions with digital currencies for U.S. residents.


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Price analysis BCH, LTC, EOS, XLM (20.09.19)

BCH/USD

Yesterday, the pair consolidated above the orange trend line support.

In the evening the price BCH resumed growth and the end of the day rebounded to a level above EMA55 hour. Night growth continued, but the next morning, the pair fell back to the level of average prices.

Today moving average EMA55 will keep a few from the pullback to the trend line. The maximum possible in the field of 330.00 USD.

LTC/USD

Yesterday, the pair consolidated in the area of 74.00 USD, below the level of the clock EMA55. Later in the evening began the restoration, which won back the price of the green ascending channel. This morning was roll which resulted in the consolidation at the level of average prices was continued.

We believe that customers will be able to use the support of the moving average in order to break the resistance of the lower boundary of the green corridor and to recover district week high (80.00 USD)

EOS/USD

Yesterday, trading volumes fell and the bearish pressure quickly faded. All day the pair consolidated at the level of the orange trendline support. There is a four-hour EMA55, from which today the price may recover to resistance 4.10 USD.

XLM/USD

Yesterday, the buyers failed to break the resistance level of 0.088 USD, and the pair retreated to the support of 0.075 USD. Believe this support will be able to save the price of XLM from further declines.

Until the end of the day it is possible to expect recovery of the pair in the area of 0.084 USD.



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Binance announced the listing of cryptocurrencies Beam

Cryptocurrency exchange Binance announced the addition of cryptocurrency Beam. Trading pairs BEAM/BNB BEAM/BEAM and BTC/USD will start today, 20 September, at 15:00 Moscow time. Users can make deposits into their accounts, according to the official website of the company, RBC Crypto.

After the announcement of the stock exchange the average market price of the coins dramatically increased from $1.43 to $1,59, then fell to its previous level and increased again. The coin is now trading at around $1.53 m for last 24 hours, the increase amounted to 17%.

Aldona capitalization is $56.5 million Coin is 83rd in the list of the largest for this indicator, digital money. Daily trading volumes Beam at the moment exceed $95 million.



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Why crypto startups are hiring former civil servants

Article

Startups are facing the stock market, are increasingly turning to former employees of the Supervisory, financial and government bodies for help in developing their projects. So, the teams of various crypto projects includes former prosecutors, national security personnel and even diplomats of the highest rank. In a situation the tough stance of financial regulators in relation to cryptocurrency experience of these experts is vital to the successful development of the crypto industry.

Why Millennials can’t help start-UPS

In November last year it became known that the Board of Directors of Ripple included Benjamin Lawsky — the former head of the financial Department in new York. In the past Lawsky also led the development of the regulatory framework Regulations governing the activity of crypto-currency companies in new York. Against this license, which is a long list of rules and conditions for the use of cryptocurrencies, made many members of the crypto community, but it is still in force in 2015 and which operates to this day.

In January of this year, a trading platform for executing trades with cryptocurrencies Omega One hired the new team Advisor Bart Chilton, a former member of the Commission on trade in goods and US futures (CFTC). CEO of Omega One Alex Gordon-Brander, said:

«The fact that Chilton is ready to take on the role of a counselor in our project, means that we have passed a certain level of complex inspection».

Despite the fact that the players in the stock market is predominately generation Y, and one in three Millennials would rather invest in crypto-asset than securities, most of them do not have much experience in traditional banking or Finance. In this connection, the financial innovators who aim to change the industry, are forced to seek help from the experts, capable to carry out their projects through numerous traps of regulation.

According to Dave Weisberger, Director-General CoinRoutes, this trend will only gain momentum, with more and more companies operating in the stock market, will rely on the experience of regulatory experts to validate their positions by the law. Nevertheless, Weisberger did not believe that it will be a guarantee of success, but potential investors should not consider such companies in the squad which includes former civil servants as a win-win:

«If someone is sure that participation of a particular adviser reduces regulatory risks for the project or product, they are badly mistaken. However, many falsely believe that in this way they get more protection «from the air»».

As suggested by Arthur Levitt, former Chairman of the securities and exchange Commission (SEC), and today the counselor cryptocurrency organizations BitPay and Mirror, new companies tend to turn to former civil servants. Thus, in the Board of Directors of Coinbase, one of the largest cryptocurrency exchanges, is Catherine Hong, who last held the position of Federal Prosecutor for the U.S. Department of justice. While working in the Ministry hon was nicknamed «Cryptocurrency Constable» for assistance in the investigation into Silk Road — a famous marketplace in the Dark web, which was closed in 2013. And cryptocurrency exchange AirSwap in many issues relying on the opinion of Clifford HART, a former diplomat who served in US consulates in Hong Kong and Macau by 2016.

The massive adaptation of cryptocurrencies and blockchain

In some cases, the participation of former civil servants in the projects helped the public acceptance of cryptocurrency and will serve as a guarantee that the popular cryptocurrency and blockchain technology on which they are built, aimed at the common good. So, a few days before it became known that the Omega team One joins Bart Chilton, former member of the CFTC in an interview with CNBC admitted that wishes she was investirovat in bitcoin and other popular cryptocurrencies before.

And in December last year, Kieran Raj, former Deputy General counsel of the Department of homeland security, and John Roth, former inspector General of the Department of homeland security, published an opinion piece in The Wall Street Journal in which he described how cryptocurrency and the blockchain will help law enforcement agencies of the United States in the search for criminals, terrorists and hackers. Both former civil servants now working on cryptogateway exchange Bittrex.

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Electronic Arts called «invest in crypto». But it was not bitcoin

A world leader in the field of video game Corporation Electronic Arts published a Twitter message with an appeal «to invest in crypto».

Many community members responded immediately to the message, including the head of the exchange Binance Campana Zhao.

Some did not miss the opportunity to advertise their own projects, for example, the founder of TRON Justin San.

Later, however, Electronic Arts was disappointed with all cryptoendoliths. Krypto was the name of a character from the new season of the game company, not an abbreviation of the word «cryptocurrency».

We will remind, in the summer it became known that the gaming company Ubisoft intends to rely on the Ethereum blockchain in the field of video games.


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The head of the SEC said that bitcoin will appear on major traditional stock exchanges

The Chairman of the Commission on securities and exchange Commission (SEC) J. Clayton stated that bitcoin needs more regulation for listing on the major exchanges. It is reported by CNBC.

«If investors believe that the pricing of bitcoin is as strict as the Nasdaq or new York stock exchange, they are badly mistaken. We need to get to the point where we believe that the trade is regulated correctly», — he stressed.

We are talking about the conditions of the listing of bitcoin itself and not derivatives, such as futures on the CME.

Earlier, Clayton said that some progress on the bitcoin ETF achieved. Company SolidX VanEck and his application was withdrawn.


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Bitwise: There are all necessary conditions to launch a bitcoin ETF

The Commission on securities and exchange Commission (SEC) published a detailed presentation of the supply of the cryptocurrency index Bitwise, in which she explains why the market is ready to launch a bitcoin ETF on a major stock exchange. This writes Forbes.

In particular, the company points to three main reasons to justify their opinion, supporting arguments with appropriate statistics. Is the efficiency of the spot market, availability of storage at the institutional level and the growth of the futures market.

The average deviation of prices by 10 spot exchanges bitcoins with real volumes decreased with time

Storing bitcoin became completely institutional

The volume of bitcoin trades in the futures market has experienced substantial growth

«In fact, today’s market bears little resemblance to bitcoin the cryptocurrency market, we had a few years ago, – said the head of research Bitwise Matt Hogan. – Today, the cryptocurrency market is dominated by firms like Jane Street and Fidelity. It is a market where institutional adjustable keepers provide services of world level and are insured through Lloyd’s of London».

The publication of the document the SEC, however, does not mean that the regulator shares indicated in her opinion. Previously, the SEC has repeatedly published similar presentations on various issues for informational purposes.

Just today, the head of SEC J. Clayton stated that bitcoin will not be released on a major exchange until it is managed properly.

Trading platform for institutional investors Tagomi on Wednesday provided comments to the SEC, stating that the license of the Department of financial services of the state of new York for cryptocurrency companies has largely helped the industry become what it wants to see power.

«Tagomi believes that having Regulations is important and a real confirmation of ensuring legal compliance,» said the company.

Bitwise is still awaiting a decision on the application for the launch of a bitcoin ETF, in contrast, firms VanEck and SolidX that its proposal this week withdrew. SEC needs to say a final word to the 14th of October.



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Coinbase can add the token Telegram Open Network

American bitcoin exchange Coinbase on Thursday revealed another list of digital assets, the possibility of listing which it is currently considering. It includes Avalanche, Celo, Chia, Coda, Dfinity, Filecoin, Handshake, Kadena, Mobilecoin, NEAR, Nervos, Oasis, Orchid, Polkadot, Solana, Spacemesh and Telegram.

It is noteworthy that a significant portion of these assets have not had time to enter the market. Founded by BitTorrent Creator Bram Cohen Chia Network, for example, is still in the testing phase. Telegram also recently had a public launch of the test network and is preparing to carry out the distribution of tokens GRAM for the primary blockchain.

As usual, the exchange notes that its publication it does not guarantee anything and will conduct further testing of the technical and legal compliance of the assets to their own standards.

Also on Thursday, Coinbase announced the addition of a Dash in the service for retail investors Coinbase.com with the help of which they can buy, sell, convert, send, receive and store bitcoin. This week Dash passed the listing on the platform professional trading Coinbase Pro.

Previously founder of Galaxy Digital Mike Novogratz admitted that would like to participate in tokencache Telegram Open Network, but accepted the company’s offer is too late.



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