Tag: crypto (page 1 of 4)

The sleight of hand of crypto

Cory Doctorow is doing the rounds for his new book at the moment. But because he’s Cory, he’s not just phoning it in, or parroting the same lines.

Take this interview in Jacobin, for example. Yes, he’s talking about why he decided to write a story about crypto, but he’s so well informed about this stuff on a technical level that it’s a joy to read the way he explains things.

There’s this kind of performative complexity in a lot of the wickedness in our world — things are made complex so they’ll be hard to understand. The pretense is they’re hard to understand because they’re intrinsically complex. And there’s a term in the finance sector for this, which is “MEGO:” My Eyes Glaze Over. It’s a trick.


A lot of the crypto stuff starts with what a sleight-of-hand artist would do. “Alright, we know that cryptography works and can keep secrets and we know that money is just an agreement among people to treat something as valuable. What if we could use that secrecy when processing payments and in so doing prevent governments from interrupting payments?”

After this setup, the con artist can get the mark to pick his or her poison: “It will stop big government from interfering with the free market” or “It will stop US hegemony from interdicting individuals who are hostile to American interests in other countries and allow them to make transactions” or “It will let you send money to dissident whistleblowers who are being blocked by Visa and American Express.” These are all applications that, depending on the mark’s political views, will affirm the rightness of the endeavor. The mark will think, that is a totally legitimate application.

It starts with a sleight of hand because all the premises that the mark is agreeing with are actually only sort of right. It’s a first approximation of right and there are a lot of devils in the details. And understanding those details requires a pretty sophisticated technical understanding.

Source: Cory Doctorow Explains Why Big Tech Is Making the Internet Terrible | Jacobin

Jacobin reviews the creator of Ethereum’s new book

This is written in typical bombastic Jacobin style, and I’ve yet to read Vitalik Buterin’s book, but I have to say I can’t disagree with the conclusion: there is no leftist case for crypto.

Perhaps there was in the beginning? But now it’s easy to see where it’s headed. And it’s not in any way a socialist enterprise.

Their intentions aside, let’s try asking with seriousness: Is there a leftist case for crypto? Helpfully, Ethereum cofounder Buterin has published a book, ‘Proof of Stake: The Making of Ethereum and the Philosophy of Blockchains’, in which he outlines how cryptocurrencies represent a “new method of social incentivization” that will offer a new democratic “way to pool together our money and support public projects and activities that help create the society we want to see.”

The book is helpful, but not exactly in the way Buterin thinks. It reveals how Buterin’s case is wholly, shockingly bereft of a political vision to achieve such a society, let alone a vision rooted in the most basic political and moral principles of the Left. If ‘Proof of Stake’ is any indication of the existing rhetoric and principles from which one could construct a leftist case for crypto, then no leftist case for crypto can be made.


What emerges in ‘Proof of Stake’… is not a clearer leftist case for crypto but a clearer sense of Buterin’s essayistic style. The instant a reader wants to hear more about this oft-mentioned equitable world of public goods that crypto can bring us, Buterin scampers back into technical discussions.


As a writer, Buterin is the perfect embodiment of crypto as we’ve come to know it: he strays from his technical world long enough to look past the convoluted discourse and glimpse the need for a political framework, but then, whether by fright or disinterest, he returns to his comfort zone. He writes with admirable passion and unusual clarity about these technical issues that his technology is confronting, but the result doesn’t add up to anything resembling a leftist case for crypto — most likely because there isn’t one.

Source: There Is No Leftist Case for Crypto | Jacobin

Crypto clowns

If you’re at the top of the Ponzi scheme pyramid, you have a vested interest in keeping it going…

Not coincidentally, the companies doing the least reflecting are the ones with their hands deepest in the cookie jar. Part of what spurred on the current crash was a cryptocurrency called TerraUSD, a type of so-called stablecoin designed to more or less equal the value of the U.S. dollar. The whole point of stablecoins is that they’re supposed to be less volatile than other cryptocurrencies, a way of protecting your money while still keeping your chips in the casino. That was the idea, at least: TerraUSD was tied to another cryptocurrency called Luna, and when its value plummeted in early May, investors promptly dumped their TerraUSD. Tokens meant to sell for $1 a pop were suddenly trading for almost nothing, and, according to Bloomberg, $60 billion of investors’ money was zapped away.


As the wider crypto market has tanked in the weeks since the Terra collapse, other flailing companies have been similarly unwilling to publicly reflect on the damage. The crypto lender Celsius Network made it big by promising yields much higher than those of traditional bank accounts. That approach generated gobs of money when crypto was booming, but apparently it hasn’t fared so well during the downturn. As rumors began to circulate about Celsius’s financial issues, the company’s founder, Alex Mashinsky, dismissed it all as “FUD,” crypto shorthand for “fear, uncertainty, and doubt.” “Do you know even one person who has a problem withdrawing from Celsius?” he tweeted. Just over 24 hours later, the company put a freeze on all withdrawals, locking customers out of their accounts. (The freeze remains in place almost two weeks later.)


Throughout the industry, there’s a sense from the biggest players in crypto that if we all just keep the faith, traders can effectively spend their way out of the crisis. Cameron Winklevoss, the billionaire co-founder of the crypto exchange Gemini, recently tweeted that the bitcoin dip feels “irrational,” because “the underlying fundamentals, adoption, and infrastructure have never been stronger.” It’s not a question of fundamentals, though; asking people to look more closely at the tech will not somehow end the bear market. A few days ago, Michael Saylor, whose software company, MicroStrategy, has spent billions of dollars acquiring bitcoin, called the cryptocurrency “a lifeboat, tossed on a stormy sea, offering hope to anyone in the world that needs to get off their sinking ship.” But right now, bitcoin is the sinking ship.

Source: Crypto Is Crashing. Have the Crypto Bosses Learned Anything At All? | The Atlantic