Thursday, August 23, 2018

Municipal Cryptobonds

In the current economic and political climate, local municipalities have to think outside the box to raise funds for projects.  This article spotlights an excellent example of a city doing just that - with #blockchain and #cryptocurrency.  Something I am confident #BlockLand will do for #Ohio.

Wednesday, August 15, 2018

AT&T Sued for Gross Negligence in Connection with Theft of #Crypto

Michael Terpin is one of the founders of a bitcoin investor angel group.  Recently, he filed a $224 million lawsuit against AT&T for a "digital identity theft" of his cellphone account (AT&T disputes the allegations) that led to the theft of his digital currency. 

So what happened?  Well, this all boils down to a SIM swap.  SIM = Subscriber Identification Module.  If you have a mobile phone, you most assuredly have a SIM card.  It authenticates who you are.  When a SIM is "swapped," essentially the provider (AT&T in Terpin's case) is tricked into transferring or swapping your phone number to someone else's SIM card (usually, the swapper).  Once that happens, it becomes very easy for the swapper to reset passwords and access accounts.  

Terpin is alleging that fraud and gross negligence on the part of AT&T was directly responsible for the SIM swap and the theft of his #crypto.  

Why is this important?

Well, first, I'm sure you're as freaked out as I am about having your SIM swapped.  So, there's that.  

Second, we will likely see more cases like this around the country that involve #blockchain technology and #cryptocurrency.  Likely, this technology will be inter-woven throughout business and the issues that arise.  Which raises questions about our current laws and procedural rules.  How should our laws be shaped to address this technology?  Should we change/supplement/modify our rules of civil procedure?  What about rules of evidence?  What experts will be used in cases like this?   I'm sure these and many more questions will be addressed by my colleagues at #ClevelandBlockLand.  

Finally, a significant amount of cryptocurrency has been stolen recently because of these SIM swaps. This incompetence with our security scares me and I, for one, am happy someone is doing something about it. Maybe this will force telecom companies to take privacy and security more seriously. 

Tuesday, August 7, 2018

Blockchain Companies Are Challenging Investment Banks

This is great - take a look:

Blockchain Upstarts Challenge Investment Banks

What is Blockchain and The Use of Blockchain Technology in Cybersecurity

Think you're secure just by virtue of the fact that you're using "blockchain technology"?  Think again!

However, before you dive into the article at the end of my post, I think it's important to reiterate what "blockchain" is and what it isn't.  Because I'm always hearing the words "decentralized" and "immutable" when someone explains or tries to define blockchain.  It also seems as though everyone looks at blockchain technology as the solution to all problems.

The short response to both of the preceding sentences is - it's not.  At least not always.

Here's my rudimentary brain's understanding:

Simply put, a blockchain is a digital ledger that can be programmed to record almost anything (of value).  So where do the words, "decentralized" and "immutable" (unchangeable), come into play?  These two concepts are really intertwined or at least they should be to actually work. 

You see, "decentralized" means there is no owner or controlling entity in place to dictate validation or recording of transactions or records - it's distributed amongst many computers, known as nodes or, more popularly, miners, that solve extremely difficult math problems (known as cryptography) all over the world and owned by various individuals and entities. 

The immutable part comes into play with the structure of the blockchain.  Each block contains information from the previous block.  In order to change a block, you would have to (1) change the rules of the particular blockchain in question and (2) change all the blocks after the block you want to change.  In order to change the rules, you need control or, in the case of Bitcoin's blockchain, 51% (lovingly referred to as a 51% attack).  Therefore, while change is NOT impossible, it's extremely improbable. 

As you can see, the immutability is directly tied to a blockchain being decentralized.  If the blockchain is not controlled by one person or entity, change is improbable.  Which brings me to my last question, which is NOT rhetorical - I'd actually like an answer or two.  If a company (let's pick on JP Morgan) decides to develop its own internal "blockchain" which it controls and for which it solely validates and records all transactions - is it really a blockchain?  Or is it just another database being called a blockchain? 

Also, please feel free to correct any statements I'm making that are wrong.  As always, these are my personal opinions and observations, not to be relied on by anyone.  :)

Thanks for being patient.  Now, here's that article I promised:

Blockchain only as strong as its weakest link

Monday, August 6, 2018

Starbucks WILL NOT Be Accepting Bitcoin ... Directly ...

When it was recently announced that your favorite latte purveyor would be accepting bitcoin at its stores, the crypto world went wild.  However, Starbucks clarified its position on accepting crypto at its stores, as follows: "It is important to clarify that we are not accepting digital assets at Starbucks. Rather the exchange will convert digital assets like Bitcoin into US dollars, which can be used at Starbucks. Customers will not be able to pay for Frappuccinos with bitcoin."

Bummer, right?  Not necessarily.  You see,  they're planning to use a platform called Bakkt, which allows its users to store crypto and trade it for products. So, you won't technically be paying for your cappuccino with BTC.  Not directly anyway.  Hypothetically, you would be uploading/storing/transferring your BTC to the Bakkt platform and that would convert it to USD with each purchase.  

Much ado about nothing?  I don't think so.  The size and reach of Starbucks may bring crypto to every consumer, including those that have never heard of bitcoin (if there are any left).  Sure, companies like Overstock and Expedia and Microsoft accept crypto online, but this will be the first time a company of this size will (indirectly) accept crypto at a physical location.  Folks that may have never otherwise purchased/used crypto might start using it - this may be the nudge the general public needed.  

We'll see how this plays out.  I'm sure there will be bugs along the way, but this is very exciting for the crypto/blockchain industry!   

#Crypto Winter Could Be Beneficial For Sellers of Picks and Shovels

This #Bloomberg  article  takes an interesting look at the #cryptowinter and how it may not affect or could even be good for those selling t...

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