Wednesday, 17 October 2018

You can keep your damn money II (for today I made my own)

As the failure of the Duckaroo left me deep in debt to Uncle Donald - should I collateralise my own currency with crypto instead? 

Kain Warwick the founder of Havven thinks so. The crypto-currency he is counting on to collateralise his nUSD stablecoin is his own HAV token which exists on the Ethereum network, home to the world's number two crypto-currency. 

Lost you already? Good for you – you are a normal human being who has yet to lose a good chunk of your existence to the crypto otherworld. Enjoy it while it lasts – crypto is coming for you. If you have not done so already it might help to read some of my previous posts starting here. 

The Ethereum network is a beast of a global computer network that runs apps. Everytime a transaction is made on one of those apps a small fee is paid to the those who dedicate the huge amounts of computing power necessary to make the network function. Because there are hundreds of these apps and millions of network users the Ethereum token has value which fluctuates according to demand.

Havven is one of those apps, or rather DApps - decentralised applications that exist on a vast public network rather than on a private server in someone’s basement.

Havven exists to sell HAV tokens that can be used as collateral to issue a digital dollar called the nUSD in the same way that ducks collateralised our paper Duckaroos. 

So thanks to Havven I can have another crack at issuing my very own currency. 

The good news is that, unlike the ill-fated Duckaroo, the nUSD is not perishable and is over-collateralised at a 1:5 ratio or one nUSD to every five US dollars worth of HAV tokens. In duck-to-dollar terms it means that I would have to lose more than 80% of my ducks before the torch-and-pitchfork crowd show up at my gate.

The bad news is that for every hundred fiat dollars held in escrow I only only get twenty nUSD to play with (which reminds me of a story about the perils of investing in magic beans).

The good news is that unlike the magic bean market I am not trusting the people at Havven with anything. The escrowed HAV tokens stay in my digital wallet until I release them by paying pack the nUSD I have issued. I am entering into a contract of my own making. With myself.

The contract cannot be altered or destroyed by anyone. There are no banks or financial institutions involved. No creditors, no paperwork and no signatures. No salesmen pose as financial consultants. No one tells me lies, and no one holds my hand. 

I'm a card carrying libertarian street samurai and game as balls so I buy 5000 HAVs for 950 Australian dollars and just get down to biz. 

As I have said, using the Ether network is not free and transferring my tokens out of the vendors wallet (Coinspot) and into my private Metamask wallet cost AU$5.70. The process of locking my HAVs into the smart contract and issuing $140 nUSD is a surprisingly simple process that costs another $2. Sending my freshly minted crypto dollars out into the cryptosphere is another $1.40.

At present there is only on exchange (Kucoin) that will let me trade nUSD for other crypto in order to make a profit. Kucoin is stocked with coins unworthy of my nUSD except for Ethereum and good old Bitcoin.

Bitcoin is sleepy and unlikely to make a move while Ether is jumpy and could go up or down so I'm in a bit of a quandry. I'm here to trade but I really don't want to lose my currency - because it is mine. I made it and feel responsible for its safety. I want to teach it to swim, to fight and to use contraceptives before I wave it goodbye at the airport. 

Usually these feelings of attachment to a crypto-currency take time to manifest themselves. Over time the tokens you hold become your pets, your friends and your allies in the harsh crypto-battlespace. This is why the hardest thing to do is not buy or hold but to sell the damn things - even for a sizeable profit. 

nUSD is not a volatile store of value like Bitcoin - it is a stablecoin designed to be useful and practical as currency because, like the stuff in your bank account, it lacks volatility. So I can't make a profit or a loss by just holding onto it.

Stable coins are used mostly by traders who speculate as to the rise and fall of crypto like Bitcoin. Most exchanges will not trade in fiat currency so they use a de-facto token that emulates the dollar instead.

So if I spend my $140 nUSD on Bitcoin for and it goes up 10% I can sell it for $154 nUSD then go to bed knowing that my 14 dollar profit will not disappear should the Bitcoin price fall overnight.

Stablecoins also solve the problem faced by Bitcoin which is that its volatility makes it impractical as a day to day currency. Though there are a few stablecoins out there, none are commonly used pay for goods and services just yet.

In the simplest of terms, the nUSD is pegged to the US dollar by a whole bunch of maths and incentives for traders to buy it when the price goes below that of the US dollar and sell when it goes above. 

So if the price is stable how can an investor make money out of it? 

The same way the banks profits from our day to day transactions. Each month I will collect my share of all nUSD transaction fees from a pool. How much I will get depends upon my collateralisation status which depends on collateralisation ratios and other things I don't fully understand yet but according to the Havven Dashboard there is $2628 in the fee pool for more than a million nUSD in circulation so I won't be quitting my day job just yet.

Other than speculating on the price of other cryptos and collecting fees I can make money by helping to maintain the nUSD peg to the actual US Dollar through arbitrage, seigniorage and other fancy terms for moving money around.

Luckily Havven provides custom tools such as Swappr and Mintr that make it easy to buy HAVs, mint new nUSD, burn nUSD to release escrowed HAVs, and swap HAV, Ether and nUSD without going near an exchange.

Or I can just sit back and wait for the HAV price to go up and hopefully trade them for a metric tonne of Christmas presents in December. nUSD is a stablecoin, HAV is not. As you cannot mint nUSD without buying HAVs, the price of HAV should rise with the demand for the stablecoin.

So far the price of my HAVs has gone nowhere, I don't know what to do with my nUSD, my fees may not be enough to buy a turnip but folks this is the dream. Not the lambo-to-the-moon one but the anarcho-capitalist I am my own bank so get off my lawn libertarian dream. Right here, right now.

The banks, particularly the central reserve banks of the nation states, have little to fear from Bitcoin as high volatility, slow transfer speeds and spikes in transaction fees make it less viable as an alternative to their fiat currency. They have much to fear from Kain Warwick. 

Kain intends to have multiple currencies including the nAUD in the market by the end of this year which could create a cross border payment system to rival Paypal and Western Union and could, by default or design, create the first tokenised forex trading platform. Another world first will be establishing Havven on the EOS and Ethereum network in parallel to create a new level of de-centralisation in the cryptosphere. 

This is cutting edge crypto, and I'm damn pleased to be part of it. 

Stay tuned as we have only scratched the surface of this ground breaking project. Find out how I finally let go of my precious nUSD and turned it into gold.

Thursday, 27 September 2018

Keep our streets safe (don't let the dogs out)

On an Autumn night in 2012 a call was made to police to report that a young man had freaked out in a convenience store and had left without paying for a packet of biscuits.


Uniformed police pursued the half naked Roberto Curti through the streets of Sydney CBD and tackled him to the ground. He was handcuffed then electrocuted repeatedly while three bottles of capsicum spray were emptied into his face. He was choked and crushed by the weight of nearly a dozen cops who piled on top of him. He died screaming in the grip of an LSD trip gone very, very bad.

In 2017 at a mid-winter fancy dress party in Melbourne the police responded to information that a partygoer dressed as The Joker was armed with a pistol. They stormed the Inflation Nightclub despite being told by the security staff that the pistol was a toy.

Dale Ewins and his girlfriend Zita were busy doing the wild thing in a dark corner when confronted by eleven heavily armed and armoured policemen. As Dale pulled up his pants and turned to face the officers he was shot, then tasered, punched in the face, forced to the ground and handcuffed.

Dale received bullet wounds to his torso and consequently required eleven surgeries to reconstruct his shoulder and remove half of his bowel. Zita was shot in her thigh and again in her knee.

Byron Bay on a mid-summer night this year a call is made to police by a hostel receptionist to report that a teenage boy is naked, intoxicated and screaming in the dark laneway outside the Nomad's Backpacker hostel. Four police responded. They soaked him with capsicum spray and hit him with a baton before taking him to the ground.

In the video shot by a bystander we see police officers struggling to handcuff the sixteen year old boy while another holds his legs. Another cop stands on his throat and strikes him several time with a baton. The teenager resists feebly and the cop continues to beat him with the weapon, breaking one of his ribs and pulverising his legs and torso. 

How much force can be lawfully used to make an arrest? 

Reasonable force – which is equal to or less than the force that is used against you. You wrestle with me I wrestle you to the ground. You come at me with a bat I can whack you silly with a baton. You pull a knife on me and I can stop your heart with a bullet.

With this in mind it is not necessary for me to point out that the force used here by police is excessive in all these examples, particularly as the cops vastly outnumbered the arrestees in every case. 

I do not write this to pass judgement on the police as individuals nor as an organisation. I will keep that to myself. I would not wish them to publicly judge me either - for in my 30 odd years in the security business I too have hurt people on the street and may hurt more in the future. It can get rough out there folks. 

But consider this, 

If the police had been called and arrived to find me standing on a kid's throat and beating him with an iron bar – what would they have done? They would have arrested me and charged me with assault causing actual bodily harm. I would be tried and convicted on the evidence of bystanders, the video and the boys injuries. As it would be my first offence I might escape jail – but I could go in for as long as five years. If three others had held him down while I flogged him we would all be liable for as much as 7 years. I would certainly lose my security licences and subsequently my livelihood. My standing in the community would go to zero. I might even be obliged to leave town.

Of the eleven police who killed Roberto Curti only one was charged with common assault as his use of the third can of capsicum spray on the dying man was deemed by the Coroner to be unnecessary and excessive. The Sergeant who was the senior officer at the scene of the killing is now an Inspector despite his conduct and lack of leadership being described by the same Coroner as abhorrent.

No police were found to be at fault over the nightclub shooting of Dale and Zita though the police were kind enough to not to press charges against them despite their ludicrous claims that Dale had threatened them with a pistol (Dale had his pants around his ankles and was shot in the back).

So it is unlikely that any action will be taken against the policeman who beat the helpless teenager in Byron Bay. Maybe some further training, counseling, suspension with pay. We shall see.

None of the victims in the cases discussed here were charged with an offence leaving us confused as to why they were set upon in the first place.

I can and have arrested people, and you can too. The Police are bound by the same laws regarding reasonable force that we are. 

So why is it that the Police get away with using excessive force where we will not? 

Not because they are empowered to do so by laws - but because they have special status as employees of the state and members of very powerful unions whose co-operation the state needs to maintain it's monopoly of force.

In an earlier story about the death of Cameron Doomadgee in Police custody I wrote that criminalising common behavior unleashes the forces of the state upon ordinary people who may not deserve it and may not have the strength and resources to withstand it.

We have by default or by design enabled the state to use apparently unlimited force against us even in situations where no crime has been committed. 

So consider please that in all these cases someone has called the Police and unwittingly unleashed upon these people the full violence of the state. Imagine how they feel now. Imagine it was you. 

A well intentioned call to the forces of the state for help can result in the horrifying death or savage beating of an innocent person. Maybe someone you know. Maybe even you. 

So to help keep our streets safe – think twice before letting the dogs out.

Friday, 7 September 2018

Bitcoin: currency, commodity or consensual hallucination?

If ducks collateralise Duckaroos - what collateralises Bitcoin? Nothing. What central bank or government stands ready to bail Bitcoin out? None. If the US economy props up the US dollar, is there a diversified, productive and growing economy propping up Bitcoin? Nope.

The value of a Bitcoin lies in consensus. Today we agree that a Bitcoin is worth around US $7000 and so today it is. If I stop believing that and and wish to be rid of my Bitcoin then someone will buy it from me for the price they believe it is worth. Bitcoin will be worth nothing only when last person on earth believes it is worth nothing.

Consensus works here because participation is voluntary whereas your participation in the fiat currency of your nation state is compulsory. “Legal tender” does not mean it is only lawful to accept fiat currency as payment (you can accept ducks, shells or Vegemite jars if you like) it means that it is unlawful not to accept the national currency to settle an account. 

The value of a paper dollar is enforced by the state whereas the value of crypto is left up to us to decide, or to opt out completely. Voluntary participation, freedom of choice, value through consensus – these things are what libertarian dreams are made of.

With no anchor the good ship Bitcoin drifts, flounders, floats, it soars and subsequently it is less useful as a currency than the good old Duckaroo which is pegged to and stabilised by the price of a duck.

But it was not meant to be so.

Bitcoin was actually designed to be a useful global currency with stability based on supply and demand economics. As more Bitcoin is spent on goods and services the more transactions are processed by computations that create more Bitcoins that satisfy the increasing demand.

This process intentionally becomes more difficult as it progresses requiring increasingly more time, computer power and energy to create new Bitcoin. The total number of coins that can be created is capped at 21 million to ensure that supply should not exceed demand.

So you can't do with Bitcoin what Uncle Donald does with Duckets. You can't mint at will the fresh coins you need to asset- strip your neighbours farms and enslave the townsfolk by constantly diluting and therefore devaluing their hard earned dollars. This is why nation states are not too keen on the whole idea of a decentralised global currency and why libertarians are.

But this is academic. If you are holding Bitcoin you bought last year at 15,000 dollars you might well find your purchasing power has halved in less than a year due which is a hell of a lot worse than your national inflation rate - unless you live in Venuzuela.

Why is it so?

Because Bitcoin's creators did not account for rampant price speculation for profit which has made crypto what it is today – a mardi gras of highly volatile speculative assets.

Very few people purchase goods and services with Bitcoin and other crypto-currencies though millions of speculators trade them on exchanges everyday. Slow transfer speeds and occasionally high transaction fees contribute to Bitcoin's lack of viability as a useful currency – but you could also blame both of these factors on volatility from price speculation which can cause dramatic spikes in network congestion.

Like gold, Bitcoin has (so far) failed as a currency but succeeded mightily as store of value with a total market capitalisation of around 170 billion US dollars. One whole Bitcoin is generally considered to be worth at least 6000 and has been worth as much as 20,000 US dollars. Not bad for a consensual hallucination.

Could Bitcoin replace gold as the global store of value – a safe haven for wealth under threat of war and economic collapse?

Not likely. The only thing that could replace gold is a metal more precious, more beautiful and desirable. Gold represents the romance of greed and the history of lust. It has been valuable across the globe for thousands of years. Ask anyone if their life savings were to be converted to Bitcoin or gold which would they choose – I will bet you that 99.9 percent will choose gold.

You don't need a computer to buy and sell gold. Or even a bank account. There are no whales manipulating the gold price. Bulgarians cannot hack your gold. You don't have to explain gold to anyone as every man woman and child on this planet knows what it is.

Bitcoin is an alternative to gold as a store of value to be sure. The rise and fall of the Bitcoin price in the last year was driven largely by frantic buying in Japan, China and South Korea - countries that were threatened most by North Korean aggression and the possibility of war.

In September 2017 the Bitcoin price was coming down from an all time high of nearly 5000 to less than 3000 dollars when North Korea launched a missile over Northern Japan and Bitcoin shot up 30 percent in the next 24 hours. The bull run that followed took the price of a Bitcoin to nearly $20,000 in December.

As for gold, is it a co-incidence that its price has been falling steadily since April this year when an inter-Korean summit between South Korean President Moon and North Korean supremo Kim Jong-un saw peace officially break out on the Korean peninsula ?

Both these assets will live long and prosper as a hedge against tomorrow. Both will benefit from rumours of war and impending doom.

So if Bitcoin and gold are such great stores of value could they, like ducks, succeed as collateral for a currency instead of being a currency itself?

Stay tuned as a these questions will be (sort of) answered over the coming weeks when we unearth digital gold and mint crypto currencies of our own.

Thursday, 30 August 2018

Uncle Donald deals with dodgy Duckets

Uncle Donald is the god-emperor of the duck universe. His currency, the Ducket, is like the Duckaroo and also pegged to the price of a duck. But his empire of ducks is vast and his ducks are fat and healthy. They breed so fast and he buys and sells so many of them that he has lost count of how many ducks he has long ago.

His wife is a Ukrainian psychic. His daughter is a best selling novelist and celebrated porn star. His sons hunt giant pandas with ninja stars. His estate has three post codes and his swimming pool has tides.

Uncle Donald has heard of my plight and has offered a solution. He will buy up all my Duckaroos from the mob at my gate and will not demand a duck for each banknote just yet.

Uncle Donald makes the deal. The Duckaroo holders are so impressed with the power of the mighty Ducket that they are willing to accept one big fat Ducket for two ailing Duckaroos.

The mob heads for the pub. Uncle Donald's prestige and his currency have saved the day and praised be the Lord.


Now I am deeply in debt to Donald. He has bought 1000 ducks from me for the price of 500. He will give me time to come up with the ducks but at an interest rate of .1% or one duck each day.

Remember, I only have surviving 500 ducks from my flock of 1000. To get out of this mess I need to breed at least two ducks a day and at that rate it will take a year and a half providing there are no more surprises.

So now I am working for Uncle Donald and if all goes well I will be debt free in 500 days. If not I could be wallowing in duckshit for the rest of my days and for no reward while Uncle Donald will get at least 1500 ducks for the price of 500 without getting his famously tiny hands dirty.

So how did Uncle Donald pull off this deal?

Because unlike myself he has the ability to print Duckets at will without anyone questioning whether they are adequately collateralised which gives him extraordinary buying power and a huge discount on everything he buys.

No-one asks the leader of a duck superpower how many ducks he has because no-one dares to, leaving him free to print as many Duckets as he wants and buy whatever he pleases with them.

Did he bail me out with the goodness of his heart? No. He is just a predatory duck hunter. And with each raid such as this one his empire of ducks grows and more importantly so does his prestige. Combined these factors mean he can print more Duckets to conduct further raids to get bigger discounts - forever and a day.

But surely it's only those holding weaker currencies that are disadvantaged here – so we should happily stick with the Ducket – dodgy as it may be.

Well, no.

As the mob heads into town with pockets stuffed with Duckets the publican decides that this might be a good time to put up his prices and and grab an extra 5% of that good paper currency. The next day the other merchants do the same and soon their suppliers do too. Now the purchasing power of the Ducket has decreased by 5%. Uncle Donald will be fine – he just prints more Duckets and carries on raiding disadvantaged duck farms. The rest of the townsfolk just bear the loss and put it down to the greed of merchants and the state of the economy rather than what it is - the constant devaluation of the Ducket. Now the good folk must work harder, save more, invest more, and beg, borrow and steal to be able to afford goods and services with money that buys less every year. And Donald has all the ducks.

But enough of ducks.

This is a story about predatory globalism and inflationary paper currency. It is what libertarians, anarcho-capitalists, crypto-zombies, gold bugs and a good deal of actual economists like to bang on about even though no one is listening because they are too busy joining those they can't beat.

Ask the Turks, the Iranians and the Russians whose currencies are reeling from the onslaught of the US Dollar wielded as a weapon against their regimes. Their financial institutions and wealthy individuals have some options - they can buy precious metals or real estate or pork belly futures: but to save themselves from ruin and stay liquid they mostly buy the currency of the enemy, which just makes their enemy stronger.

While everyday people have only their earnings and imagine that the meagre interest the banks give them is enough to off-set the devaluing of their savings, the reality is that the interest earned is probably less than the bank fees.

According to Republican Congressman Alex Mooney, who is proposing that the US dollar should once again be collateralised by gold, the purchasing power of the dollar has decreased 30 percent in since 2000 and has lost 96 percent of its value since the gold standard was ended 1913. Under the Federal Reserve’s two percent inflation target, the dollar loses half of its purchasing power every generation, or 35 years. Check out this chart from the U.S. Bureau of Labor Statistics.

So if inflationary paper currencies are unfair to all but the global predators, would a truly global currency or a return to the gold standard fix this mess, or both?

Tune in next week when we look for a solution in crypto-currency - something I know slightly more about than ducks.

Monday, 20 August 2018

You can keep your damn money (I'm going to make my own)

What is money anyway? Once upon a time it was bits of precious metals we carried around in drawstring bags. Then the banks got in on the act and offered to store the precious stuff for us and issued paper IOUs for it, which, apart from being the death knell for the drawstring bag trade, made it easier to trade in denominations of pennies and pounds now dollars and cents.

The practise of banks issuing currency was eventually centralised by governments of nation states and when the gold and silver standards were abandoned these pieces of paper were collateralised by nothing in particular other than the promise of the central bank that the money was good. We believe the bank is good because the economy of the nation state is good.

There are places in the world like Hong Kong where banknotes are still issued by two private banks (at one stage there were 13) and collateralised by some gold, silver, some land and their ability to borrow from other banks – particularly from each other.

So, if I have enough collateral, credit and courage could I could issue my own currency, starting with issuing paper IOUs for assets I hold?

Consider ducks.

As the struggling owner of 1000 ducks I am duck rich but cash poor. As a courageous anarcho-capitalist I decide to create my own currency – the Duckaroo (Ausssie birds obviously). Each Duckaroo can be redeemed on demand for one healthy duck. As the market price of a duck is around $20 so in turn one Duckaroo is worth roughly the same in fiat, which in this case is Australian dollars.

Now I can trade my ducks on the market or purchase goods with paper rather than actually carrying the damn birds around under my arms with them crapping down my legs.

Will merchants accept my Duckaroos as payment for goods and services? They don't have to because they are not legal tender. But they might if they believe that there is in fact a duck waiting for them to pick up on demand, that the price of a duck is stable and there is sufficient demand for ducks at the market so they can easily liquidate the duck for $20 in fiat. It would help if they were fond of ducks.

I head to the market and trade all my Duckaroos. Now I have 20,000 dollars worth of fiat, goods and services and I still have 1000 ducks.

And there is more good news. Ducks breed and for each new baby duck I can issue and spend a brand new Duckaroo. The bad news is that ducks are mortal creatures. So now I must put all my efforts into maintaining collateral for each Duckaroo in the marketplace.

Disaster strikes. Avian flu arrives from China. Half of my ducks die. The health of the other half is in doubt. Word gets around and I wake to find a queue of Duckaroo holders in my yard demanding healthy ducks.

Not only are the Duckaroo holders seeking to get their ducks out while they are still able, but also supply and demand economics have pushed the price of a duck up to $40 due to statewide losses from the avian flu. Panic and greed take hold and we find ourselves in the savage grip of a Duck Run.

Remember the 13 Hong Banks which once issued their own banknotes? This is what became of 11 of them. Rumours about a bank being undercollateralised led to bank runs when panicked depositors withdrew their funds en masse. With competition fierce among the many banks and no central bank to bail them out, eleven of them collapsed and were swallowed up by the others, leaving just two big banks still standing today.

So what to do? I am short 500 ducks. I could buy some but the price per beak has gone up so replacing my lost ducks would cost an extra $10,000 that I don't have.

But I might be able to stall if the Duckaroo holders believe that I am good for the ducks – just not today.

So here the strength of the economy kicks in as quasi-collateral in the way that the economies of nation states sort of collateralises their fiat currency, their banknotes that are not IOUs for anything- just attractive pieces of paper that say “You can trust me – I'm from the government”.

Will my local economy support the failing Duckaroo? Will my neighbours lend me some ducks? Would a duck merchant extend me some credit or, if not, will my local bank lend me some money? Will a merchant bank or a loan shark? Will local merchants extend me credit so that I can eat until the duck crunch has passed? Will the government bail me out? Is there a growing demand for duck products as the population is growing and wealthy enough to afford duck rather than the much cheaper chicken? Are interest rates affordable?

If the answer is no to too many of these questions: the Duckaroo is cooked, sorry. The mob at the gate will leave eventually – to get flaming torches and pitchforks.

So where did I go wrong?

Other than relying on perishable goods as a store of value, I was clearly undercollateralised. I needed at least 2000 ducks to issue 1000 Duckaroos in case my entire flock was wiped out. I also need credit and insurance, but from companies which might not be satisfied with a two to one ratio of collateral as lightning often strikes in the same place twice. Or thrice, - or more.

So how many damn ducks are enough collateral for each bloody Duckaroo? What the hell have I got myself into?

Tune in next week - Uncle Donald rides to the rescue. Or does he? We will delve further into this mess and discuss better ways to issue our own currency.

Thursday, 24 August 2017

Will Bitcoin save us from tomorrow (and John McAfee's dick)?

I got into trading crypto currency, such as Bitcoin, early in July out of curiosity and to flex my libertarian muscles and maybe pick up some anarcho-capitalist street cred along the way. I bought a couple of grands worth of coins then sat back to watch with interest as the whole market fell about 40 % in 48 hours. Luckily, we libertarians are made of the sterner stuff as laissez-faire capitalism requires a certain amount of sangfroid.

The price of a Bitcoin was down to US$1900 and market confidence was at an all time low. When the price started to climb eccentric cyber-security millionaire and staunch libertarian John McAfee tweeted that if Bitcoin didn't go to $300,000 in three years he would “eat his own dick on national television.”

Meanwhile, I was busy getting my shirt back without losing my pants in the process - thrashing about like a noob and down to my socks and underwear until the steady upward march of Japanese coin called NEM got me back in the black at the end of August - just in time for the Bitcoin Fork.

Bitcoin soared to a record high just short of $5000 US dollars and Bitcoin investors were given a free bonus coin called Bitcoin Cash which settled at $300 apiece. Had I traded my NEMs for Bitcoin I would have doubled my money in a few days. Then the good ship NEM started to sink and I was getting a little hot and bothered, so I called it a day, cashing out of the market and back into my life.

So as much as I would love to tell you a greed-is-good story of my triumph over the crypto markets - it is instead one of survival on the harsh and unforgiving anarcho-capitalist frontier. But I was there - I saw the First Bitcoin Crash, the Bitcoin Fork, the Second Bitcoin Boom. I saw alt-coins glittering in the darkness by the Poloniex Exchange.

And all the while I thought about Mr McAfee's dick.

We know how a Bitcoin went from $4 to $4400 in 8 years - it was through a process known as hodling. Investors bought 'em cheap and hodled 'em close. As the price went up they bought some more and hodled them through the good times and bad. These brave hodlers became the Bitcoin billionares - they get to fly on Space X and marry Miranda Kerr.

So how might a Bitcoin get from $4000 to $300,000 and save us from watching an old man perform such an obscene and intricate task three years from now?

Well, because of supply and demand.

Because Koreans love cryptos. They are buying up all the coins in the world and driving the second Bitcoin boom. While Americans are selling off their Bitcoins to realise some profit the Koreans are buying them up like there is no tomorrow.

Because cryptos, like gold, are a hedge against tomorrow, against the prospect of war and the chaos and expense of a re-unified Korean Peninsula. And since there is no end in sight to their 70 year old cold war they will continue to invest and the market will continue to grow and the price of a Bitcoin price will go up and up and up.

Imagine fleeing a war zone with only what you can carry. Your cash is worthless your valuables can be stolen - but you carry in your head a password to a crypto wallet. Open a bank account in any country you find yourself in then access the internet and you have funds. You may even be pleasantly surprised to find your funds have grown by several hundred percent. 65 million such people are permanently or temporarily displaced on this planet.

Because the Chinese are very keen on cryptos too. They too feel the heat from their Korean neighbours and uncertainty about the health of their economy. But more importantly they love making a profit even a small one. If I make a hundred dollars profit in a week it's nothing to me – but to a salaryman in Hubei that's a huge win. He can throw a party for all his friends and family in his favourite restaurant and bask in the glory of his good fortune. There are 1.5 billion such people in China and the one child policy is no-more.

And because it is all a game. The trading coins in the crypto market is an exciting global online computer game that you can play anywhere and anytime with only a smartphone. If you are good at it you are rewarded with dollars and you don't need to know anything about finance to play. There are 2.5 billion computer gamers in the world and a billion of them are in Asia. How many of them aspire to playing games for a living? Much has been said about the re-distribution of wealth through the gamification of work in our post-industrial future. I say it's happening already – but due to the stealthy nature of crypto you just can't see it.

Because the informal economy, not just the worldwide black market but the entire untaxed, unlicensed, and unregulated cash economy is worth an estimated 10 trillion dollars and rising. Imagine if all it needs is an unregulated, untraceable, untaxable currency for it to surpass it's only serious rival - the US economy. Well folks, it's here and it's happening.

When cryptos become a serious threat to the stability of conventional markets governments worldwide will try to regulate the crypto market or shut it down entirely a la the War on Drugs. Important to this is that not all cryptos are decentralised. Coins such as Ethereum, NEM and NEO are corporate products that reside on servers in Switzerland, Japan and China respectively. All can be shut down overnight leaving the value of the coins left standing like Bitcoin, Monero and Dash to rocket to the moon.

And because fiat currencies (the stuff in your wallet and bank account) do collapse. You buy stuff in Zimbabwe with US dollars and get your change in rand, yuan or cannabis if you are lucky enough to have cash at all. The Venezuelan economy is kaput and their fiat is literally worth less than toilet paper. Which currency do the think the 31 million locals will favour, the soaring Bitcoin or the worthless bolivar?

Most importantly because the blockchain, the technology which makes these coins, works. The crypto market is worth about US$145 billion dollars and grows by at least a billion dollars each day as God only knows how many millions of users furiously trade more than 850 coins 24 hours a day across 66 exchanges. The networks have handled everything that has been thrown at them and just kept humming along for the last 8 years. Conventional markets also are booming as confidence in the technology that gives access to those markets drives investment from people like you and me, and that guy in Hubei.

And finally, and this pertains to you my friends, because of the prohibitive cost of housing in cities all over the world. You are about to retire and enjoy the life of a grey nomad but you have three daughters about whom you worry will rent for the rest of their lives. You cannot buy them each a house so they will need money – lots more money than you will will ever have. So before you pack the Winnebago you invest $13,000 and buy them a Bitcoin each – a hedge against tomorrow. And if in 2020 they have not $900,000 between them, well – you all can console yourselves watching John McAfee eat more than just his words.

Remember U R Free - to check out Free to Change your Mind on Facebook. You are free to like, share, follow or disregard it completely. Whatever makes you happy.

Sunday, 16 July 2017

Elon Musk just gets bigger and bigger

Recently billionaire businessman Elon Musk confirmed his plans to build the world's largest battery in South Australia within 100 days. Today Mr Musk also revealed his plans to end worldwide hunger in just 30 days by making the world's biggest peanut butter sandwich to feed the hundreds of millions of starving poor.

We started out with a plan to build a giant BLT, but well you know those Muslims and hipsters are picky. Some of the team were pushing for an organic kale and mushroom pinenut pesto kinda deal but well - it was fuckin' disgusting. Our people finally settled on peanut butter - but on wholemeal 'cause like you know what happened to Elvis”.

Mr Musk also revealed his plan to end homeless today – the erection of the world's biggest yurt. Measuring 1.2 billion square metres the giant Mongolian tent would provide shelter for the entire worlds homeless population and even their pets. South Australia has been chosen as the perfect site to erect the yurt as it is mostly wide open desert and most of the population have fled, unable to pay their power bills.

We chose the yurt design because as the climate changes the homeless will be able to pick it up and move it away from floods or droughts or mutants or whatever. And if it's good enough for Ghengis Khan its good enough for me.”

Elon's original proposal was to move the homeless to Mars on Space-X but “they didn't want to go somewhere bleaker than Adelaide, but indicated they would take Mars over Melbourne any day of the week”.

However Mr Musk's eye is always on the future with plans to integrate the giant yurt with his new weapon to combat global warming – the world's biggest air-conditioner.
The problem with air-cons as a global cooling solution is that while they push cold air out the front of the device, hot air comes out the back. I wanted to ship the hot air to Mars to shut the homeless up but that would need a balloon the size of Ganymede and well that's just fuckin' silly. The team was about to give up when I said hey - lets just point the front end at the desert and set up the yurt at the back! No more desert, no more freezing, whinging homeless hipsters”.

It is that forward integration of complex systems and clarity of vision that has made me the billionaire I am today. Just today I solved the how do-we-toast-the-giant-sandwich problem without building the world's biggest toaster and another fuck-off huge battery to run the thing. Get this – you put the sandwich under the Space-X rocket before the Mars launch! Ok so it's only toasted on one side but what the fuck dude – it's my nickel.”

South Australian Premier Jay Weatherill welcomed everything Musk had to say as he was very keen to build something in South Australia – even a tent. However as the 100 day deadline looms, he did admit to nerves regarding the giant battery as his state currently “doesn't generate enough power to charge my iPhone”.

Greens Senator Sarah Hanson-Young tweeted “Happy now Elaine Musk is saving the world – so sick of rich white men telling us what to do!!”