“Lloyds Banking Group Plc said on Sunday it would ban its credit card customers from buying Bitcoin and other cryptocurrencies.”
Category: finance – Page 125
“Greater ambition to divest from fossil fuel investments and consistent climate action is needed from the global investor community to accelerate the move towards a low-carbon economy and a climate-resilient future, top UN officials said at a major investor summit in New York this week.”
Security experts say more of these hands-on demonstrations are needed to get an industry traditionally focused on physical protection to think more creatively about growing cyber threats. The extent to which their advice is heeded will determine how prepared nuclear facilities are for the next attack.
“Unless we start to think more creatively, more inclusively, and have cross-functional thinking going into this, we’re going to stay with a very old-fashioned [security] model which I think is potentially vulnerable,” said Roger Howsley, executive director of the World Institute for Nuclear Security (WINS).
The stakes are high for this multibillion-dollar sector: a cyberattack combined with a physical one could, in theory, lead to the release of radiation or the theft of fissile material. However remote the possibility, the nuclear industry doesn’t have the luxury of banking on probabilities. And even a minor attack on a plant’s IT systems could further erode public confidence in nuclear power. It is this cruelly small room for error that motivates some in the industry to imagine what, until fairly recently, was unimaginable.
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A new analysis of global science and engineering competence shows that the United States is struggling to fight off an increasingly competitive China.
The numbers: According to the National Science Foundation, China published over 426,000 research papers in 2016. America pumped out almost 409,000. If you consider the number of citations for those papers, a measure of the influence they have in the scientific community, America does better—it placed third internationally, while China comes in fifth (Sweden and Switzerland took the top spots).
Strengths elsewhere: The report does, however, note that America invests the most in R&D, attracts the most venture capital, and awards the most advanced degrees compared with every other nation in the world.
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Standard utopias and standard dystopias are each perfect after their own particular fashion. We live somewhere queasier—a world in which technology is developing in ways that make it increasingly hard to distinguish human beings from artificial things. The world that the Internet and social media have created is less a system than an ecology, a proliferation of unexpected niches, and entities created and adapted to exploit them in deceptive ways. Vast commercial architectures are being colonized by quasi-autonomous parasites. Scammers have built algorithms to write fake books from scratch to sell on Amazon, compiling and modifying text from other books and online sources such as Wikipedia, to fool buyers or to take advantage of loopholes in Amazon’s compensation structure. Much of the world’s financial system is made out of bots—automated systems designed to continually probe markets for fleeting arbitrage opportunities. Less sophisticated programs plague online commerce systems such as eBay and Amazon, occasionally with extraordinary consequences, as when two warring bots bid the price of a biology book up to $23,698,655.93 (plus $3.99 shipping).
In other words, we live in Philip K. Dick’s future, not George Orwell’s or Aldous Huxley’s. Dick was no better a prophet of technology than any science fiction writer, and was arguably worse than most. His imagined worlds jam together odd bits of fifties’ and sixties’ California with rocket ships, drugs, and social speculation. Dick usually wrote in a hurry and for money, and sometimes under the influence of drugs or a recent and urgent personal religious revelation.
Still, what he captured with genius was the ontological unease of a world in which the human and the abhuman, the real and the fake, blur together. As Dick described his work (in the opening essay to his 1985 collection, I Hope I Shall Arrive Soon):
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U.S.-trained Chinese-born talent is becoming a key force in driving Chinese companies’ global expansion and the country’s efforts to dominate next-generation technologies like artificial intelligence and machine learning. Where college graduates once coveted a prestigious overseas job and foreign citizenship, many today gravitate toward career opportunities at home, where venture capital is now plentiful and the government dangles financial incentives for cutting-edge research.
“More and more talent is moving over because China is really getting momentum in the innovation area,” said Ken Qi, a headhunter for Spencer Stuart and leader of its technology practice. “This is only the beginning.”
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Titles are chosen by editors and not journalists or experts. I fought my editor over the above title. Yes, I address the teaser—and I explain a solid altcoin investment model. But, that comes after the break. The first part of this article should be titled “Why would anyone quote cost or value in Bitcoin?”. The subjects are highly related, so bear with me…
Today, a reader asked this question:
Some financial sites discuss value in Bitcoin terms, rather
than dollars or Euros. Why would I calculate the value of a
new car, my rent or an investment in this way? It’s hard to
understand how much money I need!
Answer: Your right! It’s difficult to estimate the value of a car or your rent in terms of Bitcoin. You are paid in dollars or Euros—and your landlord quotes rent in the same currency.
On the other hand, it’s natural to gauge the value of something by comparing it to a commodity that you earn and spend at a steady or predictable rate. Therefore, your assumption that it makes more sense to determine value on a dollar-basis is absolutely correct. No one determines the value of a new car by comparing the cost with a government’s national debt—or the number of donuts you would need to sell (unless you are a donut maker).
But, this assumption is transitory. It is based on a historical paradigm that is gradually changing. We are entering a bold new era. A big debate is shaping up over How gradual is the change? But make no mistake: This change is occurring in our lifetimes…
That change will eventually lead you to estimate, earn, spend and value things in Bitcoin or a similar cryptocurrency. One day soon, fluctuations in the value of the US dollar or Euro will cause you to wonder “What is happening with the dollar?” rather than shake your confidence in Bitcoin. Bitcoin (or something similar) will integrate into your mindset as the exchange medium, rather than fiat currency of a nation state.
Naturally, a series of dominos must fall, before you realize that Bitcoin is the money. I predicted this four years ago, and the process is already occurring. It is retarded by two unfortunate events, but these are both temporary setbacks:
- Today, more people are hoarding and speculating rather than accepting or spending Bitcoin for goods and services. This delays the day that it can act as a useful, functional currency.
- Miners, users, vendors and developers are chasing different goals. This makes it very hard to agree on necessary changes that will address several critical technical problems (i.e. transaction cost, speed, electrical demand, replay issues, etc).
Both of these problems have solutions, and we have already seen the solutions at work in altcoins. Think of forks and altcoins as beta tests…Bitcoin will fold in the best of these technical improvements and will very likely continue to inch toward becoming the world’s de facto currency.
Revenue Neutral Investing
To answer the question in the title, let’s look at this from a completely different angle. The individual who asked the original question went on to ask this:
Cryptocurrency sites compare and track the cost of altcoins in
terms of Bitcoin rather than dollars. What’s with that?! Do they
assume that we will all be selling Bitcoin to buy the new altcoin?
It actually makes sense to value altcoins in terms of Bitcoin—even today. How so?…
This growing trend provides very useful information. This method of quotation helps the reader to determine the relative change in value between the two currencies and compare it to fundamentals that they learn from news and research. The information can then be used to hedge an investment or even craft a revenue-neutral investment strategy. Allow me to explain…
I am long on Bitcoin. This is not likely to change. So I keep a significant fraction of my wealth in this form.
But, I also understand that the use and market for cryptocurrencies is young and very immature. A very few other forks and altcoins are the real deal. They have solved some major technical flaws with Bitcoin and they have the potential to become a credible, functional currency. This isn’t the place to explain my favorite coins, but the strategy is relevant.
Since I already have a substantial position in Bitcoin, I wish to avoid further exposure in the market. Therefore, I invest long and short at the same time (for example, using puts and calls)* on certain coins that are likely to perform better than other coins. This reduces risk, by leaving me without a loss, if the entire market rises or falls. The only way I might lose is if I get it exactly wrong! That is, if the coins that I believe are scams do better than the ones that I feel are well-designed and with a solid adoption trend. (Remember: The risk reduction strategy is to invest on the difference between an overvalued dog and an under-performing beauty).
To avoid the downside scenario (i.e. getting it exactly wrong), focus on fundamentals and not the cost of a unit, short term trends, emotional zeal, or other technical issues. Don’t follow the crowd! Bet on value and bet against hype. (TIP: The take-away, here, is to do both at once!). Investors who consider only asset cost and trends are in a craps shoot. The smart money determines which coins are likely to be a better functional instrument than other coins and then sticks with a dollar cost averaging plan for months at a time.
Want to learn more? Want to know which coins I admire? Reach out. Let’s talk. I don’t bite.
* A regulated financial exchange for puts and calls does not exist for altcoins. But, with a little research, you can create an nearly equivalent futures contract or options instrument. You may need to be a bit creative.
Philip Raymond co-chairs CRYPSA, publishes A Wild Duck, hosts the Bitcoin Event and kicked off the Cryptocurrency Expo in Dubai. Click Here to inquire about a live presentation or consulting engagement.
“Our first principle, therefore, is that corporations should search for projects that generate economic benefits for themselves while creating socioeconomic gains for all other actors in the new ecosystem.”