Is Crypto Its Own Asset Class? Industry Experts Weigh In

Crypto’s role in finance is growing, but the technology is still new, and there are hurdles to clear. That was a key takeaway in a discussion between four crypto and blockchain leaders at the Global Financial Leadership Conference.

Pointing out that Apple has more cash on its balance sheet than the entire crypto industry has in market cap, BitMEX founder Arthur Hayes says crypto has not yet reached asset class status unto itself.

“Could it become a bona fide asset class in the next ten years? Maybe. The jury’s still out on whether or not Bitcoin is actually secure over the long run. It’s been a decade, which is pretty good, but it’s still an experiment. But it’s looking like it could be a new way of raising capital sending value around the world.”

Reddit co-founder Alexis Ohanian, who now runs an early-stage venture fund, said he applies crypto to his investment portfolio, but that there’s still plenty of risk.

“As an asset class, I aim for about 10 percent of my net worth in crypto, and my bet simply being if this future that we hope for technologically pans out, this will be a really material investment, but it’s still tremendously risky.”

Finance Gets Into Crypto

Several established exchanges and financial firms have launched crypto products, including Fidelity’s recent announcement of a crypto trading platform. Panelists, which included Dan O’Prey of Digital Asset, says these products are well-thought out despite many of them coming online during a bear market for major crypto assets like Bitcoin.

“They’re probably looking at the long-term trend here. This isn’t just a ‘What’s the price today, and what’s the interest,” says O’Prey. “They’re building out the infrastructure to enable access that their customers want to see.”

Each of the panelists agreed that the applications of crypto and, more broadly, blockchain to the financial system will have a real impact on some existing systems.

“The real projects, such as the one that the ASX (Australian Stock Exchange) has, they’re literally replacing their entire post-trade system for equities with a distributed ledger with a Digital Asset platform. As the hype dissipates, people will focus more on what’s real, what business problems can we actually solve.”

There’s also reason for confidence for crypto adapting to the financial industry because of who is building the technology. Many of the key startup founders in the space have found previous success in technology, and many come from the financial world, says Ohanian.

“The real interesting infrastructure solutions that are being built now for the enterprise are usually coming from founders who have spent time in finance, who already have the relationships there. Who were tapping into their r/bitcoin subreddit during work hours with their wheels spinning trying to figure out a way to do their job better, cheaper, faster.

Cryptos Decentralized?

Moderator Laura Shin asked if the decentralized legacy of cryptos might find friction with adapting to the largely centralized world of finance.

“What I think has always been true in technology, is users will gravitate towards the better user experience,” says Ohanian. “I think what we’re going to see in the next 10 years is going to look a lot more like traditional finance just done better, cheaper, faster than the Utopian crypto future.”

“I think with decentralization, people often get caught up with thinking that’s the goal,” added O’Prey. “Censorship-resistant cash was the goal, and decentralization was a requirement in order to achieve that goal.”

Author: Seeking Alpha Team
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IOTA Outlines Plans for Killing Off its Centralized ‘Coordinator’

The IOTA Foundation has revealed for the first time that it plans to gradually phase out the IOTA network Coordinator, which some see as a centralization risk.
In a series of posts on its official blog on this week, the foundation outlined a sequence of steps it plans to take before “Coordicide”, which it sees as a major landmark on the road to complete decentralisation.

IOTA Network Coordinator Origin

While IOTA is not a blockchain but a Directed Acyclic Graph (DAG), it does however employ a Proof-of-Work network security mechanism like a blockchain. This means that in theory, if a user were to command enough of the network’s hashing power, they could bend the consensus rules to do anything they want including double spending and network splits.  This was a particularly real risk for IOTA because unlike Bitcoin or Ethereum which have thousands of miners, the IOTA network’s hashing power was relatively small, meaning it would be less difficult for an attacker to gain control of it.

To forestall such a scenario, the IOTA network coordinator was created with a primary remit of preventing double spends. Known as “Coo”, the coordinator, which is controlled by the IOTA Foundation issues periodic transactions known as milestones. If any transaction on the IOTA network is not directly or indirectly references by a milestone, it is not confirmed. While this gives the foundation a certain amount of control over the network, it should be noted that it does not allow for transaction history to be changed or user funds to be accessed.

IOTA Gets Rid of Coo

According to the IOTA Foundation, while Coo has served its purpose well, in the interests of the long-term success of the framework, it is necessary to kill it off first of all because at least theoretically it permits the Foundation to choose which transactions receive priority, and also permits the Foundation to freeze suer funds by instructing milestones to ignore transactions involving such funds.

In addition, Coo provides a central point of risk because if it stops functioning or is taken over by a bad actor, all confirmations on the IOTA network would halt. Even more significantly, the need for milestones to confirm transactions works against the scalability of IOTA in the long term.

Despite the announcement, for now there exists no firm timeline has been given for the removal of Coo. A quote from the blog post reads:

“The short answer is that the Coordinator can and will be removed when our research team is satisfied that we understand the coordinator-free Tangle sufficiently.”

According to the Foundation, while it will get rid of Coo eventually, there is no plan to rush this through. The “Coordicide” project is the vehicle being used to ensure that all changes are communicated clearly and ahead of time as the Foundation begins the process of killing the coordinator, as outlined in a subsequent post.


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Thailand Trials Central Bank Digital Currency for Interbank Settlement

Bank of Thailand (BoT), the country’s central banking authority, is eyeing the adoption of blockchain technology in its interbank clearance and settlement system.

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According to a speech published on Wednesday, central bank governor Veerathai Santiprabhob indicated at an event in Singapore that developing a wholesale central bank digital currency is currently in the country’s pipeline as part of its wider effort to trial blockchain technology in various sectors.

The project, dubbed Inthanon, seeks to create the bank’s own blockchain-based cryptocurrency to make interbank transactions both faster and cheaper.
The initial goal of the trial, according to Santiprabhob, is to understand the potential of this technology before moving to bring CBDC into larger scale of real life use.

He said in the speech:
“Like other central banks, our goal is not to immediately bring CBDC into use, but rather to explore its potential and implications for back-office operations. These efforts should pave way for faster and cheaper transaction and validation due to less intermediation needed compared to the current systems.”

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The effort follows Bank of Thailand’s several existing work in exploring blockchain technology.

As previously reported by CoinDesk, in March, 14 Thai banks joined the central bank in March in piloting a shared blockchain platform to digitize letters of guarantee in the country. That work, according to Santiprabhob in the latest speech is “expected to become operational in the second half of this year.”

In addition, Santiprabhob said his agency is also testing a proof-of-concept that uses a blockchain platform to issue bonds digitally, and could reduce “bond allocation to retail investors from 15 days to 2 days.”

The proof-of-concept is “almost complete,” he said, adding that a product is anticipated to launch in the “very near future.”

Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

Author: Wolfie Zhao
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Decentralization is the Core of Crypto Freedom

The Satoshi Revolution: A Revolution of Rising Expectations
Section 3: Decentralization
Chapter 8, Part 2.
Decentralization is the Core of Crypto Freedom

Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has. Always remember that you are absolutely unique. Just like everyone else. Never believe that a few caring people can’t change the world. For, indeed, that’s all who ever have.

–Margaret Mead

Cryptocurrency decentralizes financial power down to the most basic unit of society: the individual. It empowers the average person who now has a viable alternative to corrupt government fiat and central banking systems.

Crypto is profoundly individualistic in other ways. Consider just one.

“The revolution of rising expectations.” The phrase refers to a situation in which an increase in prosperity and freedom leads people to believe they can improve their lives through their own efforts. The belief makes them demand political changes that allow more prosperity, more freedom. The average person is not a freedom fighter, and their demand for change need not hinge on ideology. They simply want a better life for their children.

The phrase arose after World War II had destabilized the power structure of the world. Former colonies from the Far East to Latin America and Africa threw off imperialism and despotism because average people glimpsed another option to conformity: individual freedom.

The advent of cryptocurrency is destabilizing the financial structure of the world, and it has caused a second revolution of rising expectations. It does not occur on the national level but within the lives of individuals, who can finally control their own finances in privacy and with confidence. This has deep political implications, of course, because independent people are less likely to obey.

And, yet, voices within crypto deny that the phenomenon is individualistic. Their argument usually runs as follows: cryptocurrencies depend on a cooperative network of miners, nodes, developers, and administrators. In short, it is collective. This reveals a confusion about the meaning of individualism

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What is Individualism? 

As a social theory, it means advocating the freedom of individuals as opposed to the power of a collective, especially the state. As a personal matter, it means people make their own peaceful choices, especially the choice to say “no.”

Individualism is often misconstrued as a “rugged” independence from the desire or the need for society. In some cases, that may be true. But usually the opposite applies because human beings seek interaction almost as much as they seek food and shelter.

In his masterpiece, Human Action, the Austrian economist Ludwig von Mises explained, “If praxeology [the study of human action] speaks of the solitary individual, acting on his own behalf only and independent of fellow men, it does so for the sake of a better comprehension of the problems of social cooperation. We do not assert that such isolated autarkic human beings have ever lived and that the social stage of man’s nonhuman ancestors and the emergence of the primitive social bonds were effected in the same process. Man appeared on the scene of earthly events as a social being. The isolated asocial man is a fictitious construction.”

Interacting in society or joining a network actually increases individualism because it allows each person to reach his or her potential and to achieve goals that are impossible in isolation. Jointly-produced wealth can be far more abundant than privately-produced wealth, leaving everyone involved richer. It is precisely this sort of social cooperation that has made mankind dominate the planet.

The only relevant question is: do they interact voluntarily or against their will? Are they free to say “no”?

The value of society depends upon the decentralization of power down to the individual. If power is centralized by a state or another collective, then society can easily become a disvalue. Peaceful acts, such as using drugs, can result in prison; property can be confiscated for violating an unreasonable law; children can be kidnapped by a state agency, whether or not abuse has occurred.

A Less Obvious Lesson from Satoshi

A cooperative system is immensely valuable to individuals. In the case of Satoshi, he provided it for free because he wanted to change the world for the better, and freedom is the path to that destination.

The revolution offered by Satoshi Nakamoto is a perfect illustration of how genuine individualism works in society. Economic control is vested in the hands of individuals, where it firmly remains. People can store their wealth in private wallets and conduct international trade, without going through a banking system that is an extension of the state. Trusted third parties, such as banks, are replaced by individuals, such as miners. It does not matter if the miners are part of a collective effort. It only matters that each one participates voluntarily and can say “no” at any point. If that is the case, then they remain full individuals who choose to function within a cooperative effort.

The decentralization of economic control is reinforced, not contradicted, by the cooperation of a network of people—all of whom act in their own self-interest. That’s as it should be. And, yet, all of the strangers benefit each other, even though they arestrangers who might not care for each other should they ever meet. That is true society.

It is also the reason why all state efforts to control cryptocurrency revolve around centralization. Central banks attempt to issue their own crypto in order to usurp the market. Centralized exchanges dominate trades, which they report religiously to the state. Privacy renegades are imprisoned, or otherwise slapped down hard. Private cryptos, like Monero, are accused of being “drug money,” even while state-issued crypto is regarded as pure as fresh-fallen snow. Decentralized, or private systems, are demonized when they are actually the true hope for financial freedom. Which, to a statist, probably makes them demons.

The free market and individual rights are often blamed for the problems of society. The free market exploits and individuals make the wrong decisions; or, so the story goes. And, sometimes, the story is true. But the free market and individual rights are blamed not for the wrongs they commit but because they pose the greatest threats to social control. The libertarian touchstone, Murray Rothbard, explained the difference between “free market exploitation” and state control.

“If I cease or refrain from purchasing Wheaties on the market, the Wheaties producers do not come after me with a gun or the threat of imprisonment to force me to purchase; if I fail to join the American Philosophical Association, the association may not force me to join or prevent me from giving up my membership. Only the state can do so; only the state can confiscate my property or put me in jail if I do not pay its tax tribute. Therefore, only the state regularly exists and has its very being by means of coercive depredations on private property.”

Decentralization of power to the individual, who chooses to buy Wheaties or not, is the acknowledged lesson of Satoshi. The largely overlooked one is that human beings in cooperation with each other is a basic expression of individualism.


“The revolution of rising expectations.” What people need more than anything else is hope; it drives revolutions that occur despite tremendous obstacles, and it creates peaceful societies in which people prosper. But, sooner or later, hope must be based on evidence that there is reason to do so. Cryptocurrency is not merely evidence, it is proof.

It is also individualistic, because nothing inspires individualism as much as the belief that life can become better through effort and merit.

Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

Author: Wendy McElroy
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