Notes from The Singularity

Tag: Bitcoin

Crypto Regulation: a False Dilemma

(Regulate the cars as if they were horse cars).

The problem isn’t whether there should be regulation or not: no one is stupid enough to participate in a network where there are no rules or regulations of any kind. And that’s certainly not the case with Bitcoin.

Bitcoin rules are not imposed from a desk.… Read more...

Most inventions, creations, music pieces, art or technologies that can make a difference are hijacked and exploited by a privileged few; its not just energy and money. Its basically everything.

Web3 and crypto will become mainstream and “good” when that very same parasitical class figures out the way to do the same here, with custom-made regulation.… Read more...

Tokenization of Customer Loyalty in Web3

The utility of NFTs has the potential to go far beyond that single-use case. They can completely redefine customer experience, community engagement, and loyalty.

As a result, a new era of social interactions and commercial use cases will likely emerge in the next few years.

There are also many loyalty programs on many apps — which are difficult to track or transfer.… Read more...

In the crypto quantum universe…

In the crypto quantum universe, reality splits into parallel worlds

– if you buy, Bitcoin starts to crater
– if you dont buy, Bitcoin goes to 100K

…and there´s a miserable version of you in each of those realities.

Crypto and Web3 mass adoption is not even near yet

People have a hard time grasping the idea of digital information that you can not copy-paste. The copy-paste thing works in the internet, not in the Blockchain.

Internet is not Blockchain: Internet is about information, Blockchain is about value.

Most can’t actually visualize how a Bitcoin moves around (it doesn´t move), and people just think in terms of money moving around.… Read more...

NFTs are NOT Securities

The US SEC wants to determine if creators and exchanges are using digital assets like NFTs to raise funds like traditional securities.

Securities are fungible and tradable financial instruments used to raise capital in public and private markets.

But let us remember that NFTs are not:

– Equities (they do not generate dividends),
– Debt (they do not generate interest).… Read more...

Valuation of Crypto Projects

Lets review some notes on valuation of crypto projects, using technical (network) valuation and community valuation.

The problem with predicting the movements of #cryptocurrencies or any other digital asset is that, since most of them do not generate future income (like stocks), it is not possible to calculate a long-term price or #LTV for them.… Read more...

Network Effects on Fiat vs Cryptocurrencies

Traditional #fiat currencies work because each one has in parallel a more or less extensive market where it is used and accepted. The value of money depends precisely on that acceptance.

In contrast, the concept of cryptocurrency is intrinsic to a #blockchain. The two cannot be separated because the former are not really currencies (the name is misleading), but essential parts of a blockchain through which #value is transmitted.… Read more...

Game Theory and Alignment of Incentives in Web3

The fundamental idea behind #web3 is about the alignment of incentives among the participants. But designing incentives to create #networks is complicated.

👉 This is the reason many the Web3 projects are not delivering any value or building real #communities.

✅ Game Theory to the rescue

There is a whole sub-discipline of economics and #GameTheory dedicated to studying how to design protocols that encourage rational actors to behave in socially desirable ways: it is called ‘Mechanism Design’.… Read more...

Is Bitcoin a DAO?

Some believe that #Bitcoin is an excellent example of a DAO organization. Lets see why this could be the case.

COMMUNITY TEST

✔️ BTC scales via the power of its community.

✔️ Main added value is the alignment of incentives among miners & nodes, users and developers…

✔️ … forming all together a community of stakeholders interested in staying together for different reasons.… Read more...

Banknotes vs Digital Ledgers

Banknotes and ledgers are the two ways of representing and circulating value.

Banknotes are a nice, anonymous way to store and exchange value. But they can be lost, stolen, destroyed or created from scratch as fiat money.

In contrast, digital ledgers are a much smarter way to keep track. They make value 100% traceable, validate transactions, etc.… Read more...

Is Bitcoin a failed experiment?

Is #Bitcoin a failed experiment?

3 reasons why this may be so:

1️⃣ It was conceived as money, a hard money alternative to the fiat system. Instead it has become a speculative tool. Just another room of the giant #Ponzi casino we live in.

2️⃣ Authorities have made very clear they will ban, or hiper-regulate Bitcoin in most countries.… Read more...

Are NFTs the first native crypto-economy?

#NFTs are emerging as the first native crypto economy.

What is a native crypto economy?

✅ People selling their work,
✅ In exchange for cryptocurrency,
✅ All through Blockchain tech.

This never happened with #Bitcoin, where people buys and sells with fiat money with the only expectation of an increase in its price.… Read more...

Crypto: Where are the Added Value Apps?

In 1999 Friedman predicted Bitcoin stating that internet would reduce government power and introduced the idea of digital cash, in order to reduce the power of a third party in transactions. I think that´s a legitimate objective.

Also, a business structure where control is spread out rather than hierarchical such as DAOs, and where a community of like-minded people is working together towards a common interest, without a central authority, is also an interesting figure with tons of potential to create value.… Read more...

Confianza vs Eficiencia: El Fracaso de Bitcoin

Aunque la tecnología Blockchain pueda parecer compleja, esencialmente se basa en el concepto central a todo tipo de negocio: construir confianza. La confianza no es gratuita, lleva tiempo y esfuerzo a cualquier organización construir las relaciones necesarias para que un negocio funcione. Se necesita interacción humana y sistemas de control caros de mantener.… Read more...

From Subprimes to CBDCs

The idea behind #banks is that they lend into business and industry to increase the productive capacity of the economy. This way, business and industry don’t have to wait until they have the money to expand. They can borrow the money and use it to expand today, and then pay that money back in the future.… Read more...

The challenges in Bitcoin: development

Innovation around Bitcoin is being slow: mostly exchanges and wallets. The script makes it ‘programmable money’, but its probably too restrictive. To become mainstream, Bitcoin needs a killer app… but here´s the issue: the crypto community just does not respect the user.

Developers should understand what they are doing and why.… Read more...

Notes on Bitcoin

People could not use an operating system until Windows appeared. With icons and a mouse you no longer needed to post or learn lines of code. Same is happening with crypto. Bitcoin needs an ‘abstraction layer’ for people to understand it and go mainstream.

Alice wants to pay Bob for his services and both have their own wallet.… Read more...

The value of Bitcoin does not come from some arbitrary value, and therefore people trade it. It’s quite the opposite: because anyone can trade with BTC (anywhere, everywhere with no fraud and very low fees), that as a result it has value.

With bitcoin, we can trust the people, not one man.… Read more...

Porqué Bitcoin es Deflacionario

A medida que el valor del Bitcoin se incrementa el número de ellos necesario para comprar algo disminuye. Esto es el modelo deflacionario, que llevará a que Bitcoin termine siendo una “meta moneda” y que en en la práctica sólo se utilicen sus fracciones.

Un segundo factor refuerza la tendencia deflacionaria: el hecho de que si pierdes tu monedero con las claves el dinero se pierde para siempre (nadie lo reencuentra ni se pone de nuevo en circulación).… Read more...

Bitcoin: Las Máquinas al Rescate de la Humanidad

Lo que ha conseguido Bitcoin es increíble: es el caso más grande y en menos tiempo de colaboración entre personas de todo el mundo sin la intervención de una autoridad o gobierno central.

Por eso lo importante de Bitcoin es el síntoma visible de lo que representa: una transferencia enorme de confianza de las instituciones respaldadas por los gobiernos a sistemas que funcionan sobre código.… Read more...

Porqué Bitcoin no es un esquema Ponzi

Vamos a revisar algunos de los motivos que se suelen citar relacionando Bitcoin con esquemas Ponzi:

Los pioneros reciben más rendimiento. 

Es cierto, pero el hecho de que los pioneros reciban mayores recompensas en una inversión no la convierte en un sistema Ponzi. Casi todas las buenas inversiones siguen ese patrón.… Read more...

Notes on Bitcoin: cons

Storage. You can´t keep much information. 80 bytes is the limit by transaction and the system already has some bottlenecks.

Intrinsic value is similar to any fiat money: zero. But Bitcoin is not accepted for paying any taxes and that makes it not real money.

The KYC Factor. As in the first times of internet gambling, the issue is how to get money out of the system and into your bank account.… Read more...