Brexit, Bill Clinton & Blockchain | Hodler's Digest

This week, conflicting messages from two big guns in the industry, Mike Novogratz and Tom Lee. The Galaxy Digital CEO has walked back his previous bitcoin price prediction. Novogratz said, I don't think it breaks 9,000 this year. He thinks the market decline is due to companies selling crypto just to fund the burn rate of the industry because they are not earning anywhere near the revenues from last year's. Tom Lee, on the other hand, has has reasons to be cheerful. He has just published a fundstrat survey that shows 54% of institutional players think that bitcoin's price has already bottomed out and institutions appear to be more bullish on Bitcoin. 57% of those surveys have said that bitcoin's price is going to reach anywhere from 15,000 to the moon by the end of 2019. Thomley himself appears to be sticking by his prediction of between $22k and 25k by the end of the year. Also this week, Brexit on the blockchain. The WSJ angers Eric Voorhees, but they also start their own crypto and the petro plagiarizes Ladies and gentlemen, here's your weekly Hodler's Digest Bill Clinton thinks blockchain might be the future. You should check it out. Seriously though, speaking at a conference, he warned lawmakers not to regulate it out of existence. It could do great things. Clinton was the keynote speaker at the event. Interestingly, Ben Bernank was the top speaker at last year's event. He was chair of the Federal reserve during the 2008 financial crisis. So it is safe to assume that Satoshi is not a fan. What must he think of Bill Clinton evangelizing blockchain? During the event, Clinton spoke about many tech related issues including cybersecurity, but most importantly for us, he spoke about blockchain specifically regarding the disparity of access to new tech, comparing it to the emergence of e commerce solutions in the late 1990s. The more you develop new technologies like blockchain, AI technologies, robotic technologies, the more the disparity of access is going to be felt. Clinton went on to cover familiar ground regarding concerns over crypto's role in terrorism and money laundering, but went on to add that too much regulation can be a problem. You end up killing the goose that laid the golden egg. Clinton added that this whole blockchain deal has the potential it does, all only because it is applicable across national borders and income groups. And finally, Clinton noted, the permutations and possibilities are staggeringly great. But we could ruin it all by negative identity politics and economic and social policy. There's not much to be learned from this pretty bland speech other than the fact that if you pay bill money, he'll show up and say stuff. Besides no longer being in power, the former president can't really affect change. So the question now is how will Trump embrace blockchain? Let us know in the comments. The Wall Street Journal this week released a damning report identifying around $90 million in ill gotten gains flowing through crypto exchanges. The investigation was conducted by the WSJ with the help of law enforcement and independent researchers. One exchange in particular appeared to be in the paper's crosshairs, Shapeshift, which is accused of laundering $9 million. Headquartered in Switzerland but run out of offices in Denver, the exchange has been linked to criminal activity since 2014. For example, WannaCry hackers used it to convert Bitcoin into Monero, a crypto that is very hard to trace. Here is how they did it. Shapeshift, which has a policy of not identifying its customers, made no changes following the attack. The WSJ claims the main criticism of the report is that CEO Voorhees and Shapeshift continue to flout the KYC and AML rules, followed by other exchanges like Coindesk. For example, after tracking a series of funds acquired from hacks, Investment Frauds and Blackmail 2,500 in total, the WSJ informed Shapeshift of suspicious addresses that were subsequently banned by the exchange. The chief legal officer in fact, announced plans to de risk the platform and felt the need to point out that while Voorhees is vehemently anti government, he is not pro money laundering. Following the report, Voorhees published a blog post refuting many of the claims made by the WSJ. The ShapeShift CEO says that he worked with the journalist over the course of five months and believes that he was misled. Furthermore, he points out that Shapeshift does in fact have their own internal AML program. Voorhees sharpest criticism came when he accused the WSJ of simply not understanding cryptocurrency and blockchain. What do you think? Is this yet another example of the mainstream media unfairly vilifying crypto? Or is Voorhees clinging onto a cyberpunk fantasy that resists any kind of regulation, no matter how sensible?

I've been a Markets reporter for 10 years, but I've never seen anything nearly as wild as the cryptocurrency frenzy we actually created. The WSJ Coin.

On a slightly lighter note, but staying with the Wall Street Journal, we spoke to Steve Rosalillo about a mini doc he made about his efforts to start a WSJ crypto. Why he did it, what was surprising about the process and how crypto can transform journalism.

Let's dive right into the industry and let's create our own cryptocurrency and let's see what we could potentially do with it, and let's see what the benefits are, let's see what the risks are, are. And really, the best way to tell this story is by actually doing it. You know, going to Japan would be one of the best places to go because that's one of the quote, unquote, crypto paradises out there in the world. And there's a lot of industry players out there. And so we figured that's where we're going to start and we'll go from there. We pitched WSJCoin to investors, and basically we just started off the pitch, literally by saying, we're with the Wall Street Journal. We're going to launch our own cryptocurrency. Would you buy it? And no other questions asked, no other information, just plain simple, would you buy it? And it was almost a resounding yes, a hesitance among companies like the Wall Street Journal, as well as other established companies, to really dive deep into this industry and this market. And I mean, we're seeing slowly that big companies are really getting involved. But still, there's just, with all the negative headlines out there, there's a lot of money laundering, there's a lot of market manipulation, there are exchange hacks. There's so many things that are happening that could make people skeptical. I see the potential. I see why there is such excitement. I see that there really could be use cases where blockchain really does revolutionize a lot of traditional industries out there. You can actually pay readers to read your stories and incentivize them to read by then giving them tokens that they could use for whatever it may be for other types of membership, perks or benefits. So I think that's also a potentially interesting use case for crypto and the media industry. This is not an easy time for newspapers. Newspapers are struggling. The traditional business models are not working, and things need to change. And I think being creative and looking at what blockchain or crypto could offer is certainly a way that media industries could try to figure out new revenue streams in order to enhance their business goals.

Venezuelan President Nicolas Maduro announced on national television the official launch of the petro set for November 5th. The website has already been launched and the wallet is available on Google Play. But eagle eyed Joseph Zhao, an Ethereum core developer, noticed several similarities to Dash's white paper in the Petro white paper, prompting accusations of plagiarism. Furthermore, the Petra white paper makes the claim that each token is backed by oil, which contradicts the Reuters report that many oil fields in Venezuela are not operational and won't be for several years. The word credit comes from the Latin credo to believe no one will invest in a national crypto from a government they simply do not believe in. Despite the almost complete lack of confidence in the pressure project, not to mention the crippling sanctions, Maduro continues claiming the Petro will be available on at least six major exchanges, but failed to specify a single one. Maduro has also stipulated that oil purchased for international and domestic flights must now be paid with Petro. It is, however, not entirely backed by oil. The new white paper lets the public know it's backed 50% by oil, 20% by gold, 20% by iron and 10% by diamonds. Ordinary Venezuelans may have no faith in the Petro, but crypto continues to be a means of survival, whether it be mining or simply getting their life savings out of the country without the threat of violence from the authorities. Despite early promises of improved sovereignty and free puppies, Brexit is proving to be quite a complex, bleak and futile process, not least because of what it will mean for Ireland. Currently, the Republic of Ireland and Northern Ireland enjoy a so called soft border which basically allows for fluid trade and travel between the two countries. However, leaving the EU most likely means leaving the Customs Union and that means a hard border which the Irish want to avoid. Well, it's okay. Philip Hammond, Chancellor of the Exchequer, has a plan, and not just any plan, but a vague plan. Speaking at a conference, he said, I don't claim to be an expert on it, but the most obvious technology is blockchain. But why is it the most obvious technology, Philip? Did you think your fellow countrymen would be distracted by a buzzword? Thousands of trucks pass through the border daily. With many more thousands of products on board, tracing and scanning them would prove challenging. A distributed ledger might in fact be the answer, but it would require some serious thinking from the Chancellor, something it's safe to assume he hasn't done. We spoke to crypto lawyer George Morris to break down why Hammond wants to put Brexit on the blockchain, asking if there is any hope for the technology to make the process smoother. Spoiler alert. There is no hope.

I'm just not sure that distributed ledger technology really gives the answers to the Irish border question. I mean, it could, it could form part of this solution, but it's definitely not the answer. I mean, one of the things with a supply chain management system that people are talking about in the DLT world is that it doesn't necessarily actually do the logistics. What it does is record the process of the supply chain and the movement of the goods. It doesn't actually check the goods itself. And so whilst it could form part of the solution to be able to form an audit trail and a sort of Providence type record for good passing through the border, it doesn't necessarily fix the problem because it can't actually physically check the goods at the border. It's not possible.

Despite real use cases being thin on the ground, blockchain adoption could be worth $7 billion for tech companies like Amazon and Microsoft. This, according to bank of America Research, is why they are confident about the seven billion dollar value. But as the pace of adoption is currently quite slow, analysts at the bank couldn't quite say when this would happen. Companies who already have cloud services stand to benefit the most. It could be combined with blockchain tech to enhance supply chain operations. For example. According to the head analyst, Amazon will benefit from incremental cloud services demand from blockchain implementation. While improved supply chain tracking should make Amazon's retail operations more efficient, Walmart is already somewhat ahead of the curve, last week announcing it would require their leafy greens suppliers to use blockchain to improve food traceability. Other companies mentioned in the research include Oracle, IBM, salesforce.com and VMware. It is a very exciting space, but it is also filled with uncertainty. Blockchain implementation is still not straightforward, says Cash Rangan, head analyst. Many blockchain use cases have have been identified, but full products and services have not yet been built out and are not used in production. So who are you closer to in your price predictions? Are you more of a Tom Lee type or a Mike Novogratz? Let us know in the comments. And as always, like subscribe and Hodl cointelegraph Like subscribe and Hodl.

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