25 May

Recommended read.

“Dalio’s Bridgewater team looked across time to the East and the West.

The data suggests empires last about 200 years. It all starts with education, which leads to innovation and productive competitiveness. Growing military power, funded by growing wealth, protects trade and financial flows that attach to a dominant power. After a rise and time lag of almost 100 years, the incumbent is crowned with the gift of a reserve currency – that financial superpower that allows it to print money. Yet, when that superpower is over-exercised, and investments in education and innovation erode away, debt cycles accumulate and collapse the whole endeavor.

Now, as the U.S. has to contend with the rise of China, it competes with a nation that has improving fundamental attributes (education, innovation) but not yet the reserve currency. The reserve currency allows its bearer to generate economic activity from thin air at the expense of the rest of the world.

Through this lens, China’s quick movement to the blockchain-based yuan is a story of battle for global hegemony. It needs to park its reserve currency into the crypto ecosystem. That will compete with over $10 billion of U.S. dollar-denominated stablecoins already in use.

The U.S. is massively unmoored from scarcity by design, which puts us on the brink of a systemic paradigm shift. Last month, the government printed 20% of GDP in a single stroke, and will continue to do so for the foreseeable future.

Now is not an incremental time. Now is not a time for mild cost savings or small improvements in user experience. Now is a time for building the future of the world.”

See Also: Ray Dalio: Shifts in Wealth and Power

“Traders make money by being right: the number has to be accurate. This is the ‘Sense Making’ aspect of prediction markets — they don’t just react to news, they must determine how much to react to news. What is significant new information and what is not? Who is a credible source and who is not? By forcing us to sense-make, prediction markets destroy filter bubbles.

We have three major prediction markets in the U.S.:

  • The stock market
  • Interest rates (e.g., 10-year treasuries)
  • Commodities futures

And that’s it. We manage what we measure, and we don’t measure nearly enough. Do you care about:

  • More effective government
  • Enabling new business models and economic activity
  • A healthier political dynamic
  • Better modeling and estimation of the future

Prediction Markets.”

“Cheng said that Pichai’s prediction of five to ten years is based on commercially available quantum computers.

In the intelligence world, which Cheng knows well—his company has worked with the counter-terrorism departments of organizations such as NATO, GCHQ, and NCSC—’there’s been some evidence that it could well be around two years away.

Right now, it’s up to the blockchain and cryptography community to build quantum-secure blockchains. One major milestone is a competition to create post-quantum cryptographic algorithms run by the National Institute for Standards and Technology (NIST).”

“Layer1 Technologies has deployed its proprietary mining containers as electricity storage systems to stabilize Texas’ electricity market. Layer1 asserts that its bitcoin batteries will help stabilize Texas’ seasonally volatile energy market by releasing electricity to meet demand.

The mining firm is ‘the first company in the global Bitcoin mining industry that can curtail large amounts of energy consumption during times of market need and release it to the grid at the push of a button.’

Layer1 Technologies outlined an ambitious plan to repatriate 30% of Bitcoin’s total hashrate back to the United States by the end of next year.”

See Also: China Strikes Down 10% of Global BTC Hashrate, Who Will Pick Up The Slack?

“Both data and first-hand accounts from industry insiders indicates that an interest in Bitcoin (BTC) from institutional investors is accelerating at a rapid pace.

Most funds and hodlers, they’re not shorting really. All of them are long.

As of today, GBTC has taken 350,000 BTC out of the circulating supply. This represents 2% of Bitcoin’s circulating supply. In the last three months, the pace at which institutional investors have been investing into GBTC has tripled.

The combination of the central banks injecting trillions of dollars into the economy and the diminishing issuance of new Bitcoins because of the halving is creating a “perfect storm”.

Bloomberg analyst, Mike McGlone, believes that the mainstream adoption will lead to the SEC’s approval of a Bitcoin electronically traded fund, or ETF, in the near future.”

See Also: Tyler Winklevoss: Stablecoin Race to Begin When Wall St Embraces DeFi

“Some Reddit users have already announced the launch of a decentralized autonomous organization (DAO) dedicated to Reddit’s new cryptocurrencies.

Although it’s not entirely clear what the goal of such a DAO could be. Its organizers noted that it will allow Redditors to create a ‘bank of funds [that] can be collectively voted on to spend on whatever the community wants.’

With MOONS and BRICKS now available to Reddit users, these tokens can be used elsewhere throughout the entire Ethereum ecosystem.”

“‘For assets that have persistent external utility, I believe NFT is an appropriate token form,’ Shiba stated, listing subscription rights, decentralized autonomous organization, or DAO, memberships, and intellectual property rights, and in-game items as examples of assets that will see increasing tokenization.

Users propose their preferred lending or rental terms. If a loan repayment is not met on time, the NFT is automatically returned to its owner, with the entire process taking place without intermediaries.

Yiedl enabled NFT owners to earn passive income with their assets.”

“The report finds that Monero’s introduction of strict security and anonymity requirements on its broader ecosystem has maintained the asset’s status as “effectively untraceable.”

Transversely, the report concludes that the lack of utilization of Zcash’s privacy capabilities on the part of more than 99% of users undermines the privacy of the overall network despite ZEC offering “strong cryptographic features.”

The “minuscule” set of ZEC users utilizing shielded transactions renders Zcash “effectively traceable.”