Bitcoin, Blockchains, and Boomcoin

Cryptocurrencies can be more than a little confusing. The New York Review of Books (January 18th, 2018, http://www.nybooks.com/articles/2018/01/18/bitcoin-mania/

) reviews three books that attempt to bring them all into some perspective. There were some truly astonishing pieces of information. The most remarkable is the enormous amount of energy used in date "mining." "Mining is the process of using computer power to solve an algorithm -- guessing a number preceded by the correct number of zeros between zero and 4.294,967,296 -- which then gains the user a bitcoin. It used to be individual users could do that at home, but now that individual bitcoins (they don't exist physically, only virtually in the digital world) continue to spiral in value thanks to the speculative bubble, and because speed is so much more important, huge supercomputer farms are now employed to work on the puzzle. It takes trillions of guesses and a substantial amount of energy. One such conglomerate estimates energy costs for each bitcoin generate cost 90-95% of each.  

"By one estimate, the power consumption of bitcoin mining now exceeds that of Ireland and is growing so exponentially that it will surpass that of the entire United States by July 2019" Sites are located in areas where energy is cheap, Iceland being a favorite, especially after Iceland's decision to build a series of dams for hydroelectric generation leading to a surplus of energy there. "According to David Gerard—whose new book, Attack of the Fifty Foot Blockchain, is a sober riposte to all the upbeat forecasts about cryptocurrency like the Tapscotts’—“By the end of 2016,” a single mining facility in China was using “over half the estimated power used by all of Google’s data centres worldwide at the time.” 

That's simply extraordinary and obviously, it seems to me, unsupportable, if not catastrophic. The way exchanges attempt to recover these costs is through fees, now approaching $20 per transaction. That would make purchasing things rather expensive, I would think. And you thought costs per check were expensive. 

The use of blockchains, however, as a way to store and validate information is truly fascinating and shows promise. How they would be financially supported is more problematic as entrepreneurs use crowd-sourcing to fund other forms of cryptocurrencies and devices that essentially don't exist. "According to the website CoinDesk, as of this fall, more than $3.5 billion has been invested in ICOs, almost all of it in 2017, with close to $3 billion pouring in between June and the end of October. “It’s kind of like when you are a little kid and you know you are getting away with something,” an investment analyst named Chris Burniske told Popper. “It’s not going to last forever, but it’s fun in the interim. The space is giddy right now.” 

Now that banks and financial institutions have entered the field I suspect the environment will change drastically and blockchains will be used as a secure and inexpensive way to conduct business. The impact on middle managers may be enormous as the need for them disappears. "Whereas most technologies tend to automate workers on the periphery doing menial tasks,” the Tapscotts quote Buterin saying, “blockchain automates away the center. Instead of putting the taxi driver out of a job, blockchain puts Uber out of a job and lets the taxi drivers work with the customer directly.”  

One of the most attractive parts of cryptocurrency and blockchain technology is its anonymity, yet that has also proved to be the downfall of some of the more corrupt. "The FBI was able to catch Ross Ulbricht, the mastermind of Silk Road—the multimillion-dollar criminal enterprise he operated on the dark web through which users could exchange drugs and guns and stolen goods for bitcoin—because after seizing his computer, they were able to link him to the bitcoin wallets where he stored his earnings. They then used the ledger to trace his entire transaction history."

Sooner or later, someone will realize the emperor has no clothes.

 

 

Shameful

On the Statue of Liberty a striking phrase has brought hope to millions of immigrants:

"Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tost to me,
I lift my lamp beside the golden door!"

In 2001, following a terrible earthquake in El Salvador, thousands of Salvadorans were given special visas to come live in the United States. By all accounts, some 15 years later, they have become model citizens, had children and made new lives. The Trump administration would now send those people back to a country from which they fled. Their children, born in the United States would have to go along or remain behind.

In 2014, Secretary of State Clinton defended the decision to deport children from Honduras who had been sent on dangerous journeys by their parents in order to find a better life in the United States. Most found their way to relatives already living in the states. Other children, having grown up in the United States and knowing no other country, but who happen to be the children of undocumented people, now risk being returned to the country of their parents even though they identify as Americans, have never known any other country, and loved this country. All have in common that they were made a promise (DACA) they could stay.

It is argued that these people should have gotten in line and done the paperwork like our ancestors. That there were no lines and barely any paperwork then is hardly considered.

Have we as Americans lost all our humanity? These are precisely the kinds of people we need, hard-working, loyal (many have served in the armed forces), solid taxpayers. Instead of the solace promised by the Statue of Liberty, we kick them out, no doubt a sure way to build a wonderful relationship with them in the future. They have become political pawns in an immoral game of chicken between two political parties who have abandoned the principles of the Statue. This is not a partisan problem; both parties have jettisoned compassion. Shame on us.

Review: Two Kinds of Truth by Michael Connelly

Certainly an ironic title as Bosch recognizes only one kind of truth: his. Connelly books are always good (well except the one where Bosch goes to Hong Kong, which was really stupid, and this book is no exception, especially as his step-brother makes an appearance defending Hieronymus (what an inspired name for a detective) from charges of malfeasance that threaten to ruin his career and life. I find Bosch to be a distasteful character, sanctimonious, holier-than-thou, overly righteous, but with the exception noted above the books are all good, especially the legal ones featuring Mickey Holler.

Review: Fire Inside by Steve Delsohn

Delsohn has collected the personal feelings of firefighters and paramedics with regard to a host of issues ranging from fear, danger, brotherhood, and even the little things. Over one hundred men and women are represented. It's interesting and often poignant revealing the human side of a profession that took a real hit on 9/11 (it was published in 1996 so there are no references to that memorable event.) I wish sometimes the individuals could have been a bit more detailed, but it's a nice representative sample.

Review: Red Sparrow by Jason Matthews

We are introduced first to Nate, a relatively new CIA operative in Moscow, who manages to elude a random counter-intelligence sweep while meeting with a very high level Russian source. Then comes Vanya, uncle to Dominika, chief of the counter-intelligence agency, devoid of any ethic other than devotion to his country who enlists (quasi blackmails) Dominika who sees the world in assorted colors - literally - into the SVR and for training at the Kon Institute (prostitutki school - I leave what that is to your imagination)in order to seduce Nate whom he had suspected as the contact for the mole in his government. Nate has been moved to Finland as punishment for almost getting his source revealed.

Then it gets tricky as each tries to recruit the other. I will not reveal too much more except to suggest that two agents known to each other with the same handler, one of whom is a highly placed Soviet Mole, the other one in the U.S. and each side engaged in vigorous mole hunting. It makes for fun reading.

Why the author included recipes at the end of each chapter is totally beyond me, however. I look forward to reading the rest of the trilogy. It will be interesting to see whether the movie makes a mash out of the book.