Dark Markets Get Bigger

Dark Markets are getting bigger as estimated in a 2012 paper by Nicolas Christin, a computer engineering professor at Carnegie Mellon University. Christin is updating his study.

He is not taken aback by the growth of dark markets since Silk Road’s demise. “I want to emphasize that it is unclear that the number of listings is a good proxy for economic activity. One might list a large number of items and yet not carry out that many sales,” he is quoted as saying.

And he added, “Law enforcement is only part of the risk for people who sell drugs. The bigger risk and more frightening risk is not someone kicking down the door to arrest you, but someone kicking down the door to kill you and steal your stash.”

The dark web is hidden and not accessible by a normal web browser. Websites on Tor are samples of dark web sites. And the dark web seems to be moving beyond drugs. OpenBazaar for instance lets vendors sell anonymously without centralization. Trade is via bitcoin.

This market is abetted by many so-called criminal activities. After the spasmodic quasi-legalization of marijuana, so much remains illegal. And thus the growth of Dark markets.

Japan Proposes Joint Currency With Russia

Japan is trying to ease tensions with Russia by offering to build a common cryptocurrency. The idea is to settle a fight between the two countries over Kuril islands.

Located in the north-east of Japan, the Islands are currently under Russian control. The economy is supported by fishing trade and minerals.

But recently Japan and Russia agreed to economic arrangements for the islands in dispute. And now Japan has offered a common currency in the area. Moscow is reviewing the proposals.

Japan is changing its attitude on bitcoin and Russia has moved away from criminalizing bitcoin as well. There are opportunities for the two countries to work together on a common currency, the first of its type for either country.

Two Ways of Approaching the Cloud

Recently two companies buttressed their cloud offerings with blockchain solutions. Both Microsoft and IBM are now offering blockchain to clients.

IBM recently offered IBM Blockchain to help clients with blockchain networks. Microsoft made BaaS available to its cloud based Azure service. Microsoft’s BaaS will work with many different systems. One of the most popular is Ethereum.

IBM is a member of Hyperledger run by a steering committee that includes IBM. Microsoft is not part of Ethereum and has no say.

IBM and Microsoft are both IT leaders but these are new days. It is possible that having a say in your cloud parameters is a good deal more important than simply participating. Time will tell.

Edgeless.io Builds First Fully Transparent Casino

Edgeless.io is in the casino business. It will provide a 0% house edge.

Tomas Draksas, professional gambler and co-founder of Edgeless.io was quoted as saying: ‘We want people to have a good time in Edgeless casino so it was important for us to address this problem of trust. We want to create a place where gamblers can be confident that game play is fair and transparent and of course that the odds are the best offered.”

The blockchain-based casino will give verification throughout the game. Edgeless hopes its 0% house edge and blockchain verification will provide it with a winning edge.

Once the casino is running, Edgeless intends to offer new games including sports betting. Edgeless was started last year Blockchain and gambling enthusiasts in Germany and Lithuania.

Cryptocurrencies Are Up Hard Despite the CIA

Cryptocurrencies are going up in value quickly – and in large amounts. For instance the price of ether, fueling the blockchain platform ethereum, rose to all-time highs this week. It surged to 42.89, after rising to previous record levels early in the week.

There have been continued gains in trading volume as well. Part of it may have to do with a brief downturn in bitcoin prices after the SEC decided against a bitcoin ETF.

The SEC would have had to change rules to allow the ETF and chose not to do so. But cryptocurrencies generally have been up hard in the past weeks, by well over $4 billion – by well over 4.5 billion as a matter of fact.

According to CoinMarketCap, trading volumes have just exploded. Dash has climbed to over $70. Monero is up to $18. Older digital currencies are up too.

The idea is that cryptocurrencies generally are gaining exposure. Such a small percentage of currencies are crypto that even a mild addition can be a big gain.

Of course, on the other side are plenty of people who believe the CIA had something to do with cryptocurrencies and the first white paper on the subject.

The CIA has been behind Google and Facebook, so why not cryptocurrencies? The CIA may have helped create cryptocurrencies to ensure that central banks have access to their own versions.

At some point then, cryptocurrencies will be taken down so central bank oriented cryptocurrencies can gain center stage. On the other hand, the CIA may find it difficult to destroy private cryptocurrencies.

Too often, as the CIA tries to anticipate trends, it ends up encouraging what it wants to take down. Private cryptocurrencies may be stronger and more durable than the CIA thought – if the CIA was initially involved.

Too bad for the CIA – but not for us.

Food Crackdown – By Government

Australia Post has announced partnerships with Alibaba and Blackmores, an Australian natural health company to stop counterfeit food. They will develop a blockchain platform to help trace food.

Australia Post or AusPost is a government entity and the government that does much of the tracking. “We are delighted Alibaba has invited us to create an innovative platform, which will track food from paddock to plate, strengthening the supply chain,” Bob Black of AuPost was quoted as saying.

Audits are part of the process. However one wonders if such auditing has many benefits. The idea is that one either wants to produce bad food or is faking the production. In either case the market can probably do a better job of policing itself than regulatory authorities.

Once again we see enormous time, effort and corporate dollars flowing into procedures that assume government has the answers, when it doesn’t.

Study Blockchain for Regulatory Efficiency

The central banks of the G20 countries are being urged to study blockchain activities and Smart City applications. The report is from the Centre for International Governance Innovation (Cigi).

Cigi is urging the G20 to “hold the key to building an inclusive global digital economy that is auditably secure and transparently accountable to the world’s citizens.”

There are four proposals. The first is a call study the monetary and fiscal policy implications of cryptocurrencies.

The second involves the willingness of the G20 to see if international regulatory regimes can become more efficient due to blockchain regimes.

The third is the creation of a “global regulatory sandbox” that will test the most promising blockchain use cases.

Finally, the G20 working on blockchain-related issues with other regulatory agencies.

Says Cigi: “The G20 must act now to exercise innovative leadership and engage in thoughtful experimentation. It must commit to developing appropriate multi-stakeholder initiatives that leverage blockchains’ strengths and foster a more inclusive, open, and accountable global economy for all.”

This is cogent and effective if one believes that a primary purpose of blockchain is to enhance regulatory authority.

If the idea is to make regulations more efficient then the proposals are appropriate. But from our point of view, blockchain technology is supposed to help outfits become more privately effective. Regulation has little to do with it.

IBM Unveils a New Blockchain

IBM is unveiling its hyperledger-based blockchain application Monday at a Las Vegas conference. The IBM Blockchain allows one thousand transactions per second, and IBM called it the “first enterprise-ready Blockchain service based on Hyperledger.”

Hyperledger includes methods to isolate “the ledger from the general cloud computing environment.” Also the ledger includes “building a security container for the ledger to prevent unauthorized access and offering tamper-responsive hardware, which can actually shut itself down if it detects someone trying to hack a ledger.”

Earlier this month, IBM and Maersk readied a Blockchain-based solution for international shipping, something which could be live by as soon as the fourth quarter of 2017.

The problem with IBM is that this is not just a hyperledger, but one that belongs to a company that is far bigger than it should be. As pointed out in the past, IBM like other large companies is inflated beyond its normal size by judicial decisions.

Intellectual property rights, corporate personhood, monopoly central banking and regulation have all conspired to make IBM much bigger than it would be ordinarily without judicial force.

Even though IBM has a right to do what it does, it should do so without the aid of judicial decisions. We can approve of IBM’s moves toward a blockchain without approving of the larger elements of the company itself.

These are some of the difficulties that should be resolved as companies move into the next arena of bockchain technology.

Illinois Is Making Government More Efficient With Blockchain

Illinois is developing a plan to create blockchains across numerous government agencies.

This would be a better plan if private entities created and implemented it. A government-run public blockchain will make government entities more efficient but so what?

The whole idea a of a blockchain is to cut out the middle man. But cutting out the middleman when it comes to government and other agencies doesn’t make anything more efficient. It still leaves government available and active. It thus makes tax collection and other such matters more immediate.

Revealed at the DC Blockchain Summit, hosted by the Chamber of Digital Commerce, the multi-agency, public-private partnership aims to connect much of the state’s infrastructure using a shared, distributed ledger.

Beyond just a play to streamline bureaucracy, the Illinois Blockchain Initiative’s plan is designed to turn the native home of derivatives and the center of the US mercantile exchange into a fountainhead from which other states might also work to adopt blockchain.

For instance, a blockchain style system is to be used for “energy credits.” What this means is that a global warning system is to be implemented at a local level.

Even if there is in fact global warming, accusing people of contributing to it is probably something that doesn’t make a lot sense.

But this shows how government interferes with the private sector. Government sets the pace, no matter how ridiculous the outcome. In this case, government will ask that people apply for tax credits as part of a larger program that may include an actual energy taxes.

Sure credits will be available more efficiently via the quasi-blockchain but that will only make the program more insistent and not any less wrongheaded.

The idea that blockchains and smart cities inevitably include government programs, often massive ones, doesn’t make the near future any more comforting. No matter the efficiency of blockchains, governments structures never make any money. They only collect it.

Leveraging blockchains will only made the collection process more efficient.

Coin Science Announces Expansion of Programs

Coin Sciences is pleased to announce a new collaboration with Seal Software, the award winning platform for contract discovery and analytics. Seal is to integrate MultiChain as a key component of its platform, combining Seal’s machine learning framework for intelligent contracts with MultiChain’s advanced streams functionality.

This will enable a single view of a multiparty contract’s terms and conditions to be shared, negotiated and managed on a peer-to-peer basis between the parties involved.

Together with these new partnerships, Coin Sciences is today announcing the first beta release of MultiChain 1.0 for Linux and Windows. The beta release represents the culmination of over 2 years of intensive development, driven relentlessly by feedback from developers building on the platform.

During the beta period, additional testing and optimization will take place, with the final version 1.0 release due in summer 2017.