Occasional musings on crypto from an early investor, entrepreneur, and two-bit idiot.
TBI's Daily Bit

The Bit or the Bottom

April 18, 2018
Daily Bit

Tight schedules + small team + 24 hours in a day made for another missed Bit above-the-fold today. I promise I'll have something exciting tomorrow.

Just as well, though, because we can make today's Bit is about you! 

Do you really care about the Daily Bit, or is this all about the curation below?

You may have noticed below-the-fold we have links to a lot of good stuff, but most of it is news coverage. Where we want (and need) to spend more time is on curating A+ posts directly from the experts who are at the bleeding edge of their fields.

Medium is an untapped and poorly curated gold mine of crypto information, so my question to you is: who are the best Medium authors that you read religiously?

We're creating a list, so that we never miss one of their stories either. Help us help you. 

Until tomorrow...



I Like Pictures

Number of transactions can be a flawed if not outright gamable metric. Still NVT (network value to transactions ratio) persists as "crypto's P/E," and it's worth keeping an eye on among many other metrics. I asked someone earlier which cryptoassets they thought had the most transactions.

Dogecoin was not on their list yet here we are, very safely in the top 5.

DogecoinDark cracked the top 10. Must be all those PornHub subscriptions kicking in. 

Red Pillz

The volunteer army at Messari is building a free, open-source library that anyone can use as a resource, so you can go down the crypto rabbit hole a bit more efficiently.

Trying to boil down the concept of sharding into one paragraph yesterday reminded me how daunting it can be for new developers coming into blockchain.

Today’s profile looks at Dragonchain, a project that hopes to make is easier for businesses to build decentralized apps. The platform uses established languages like Python, Java, and C#, and hosts all new code on AWS servers. To incentivize businesses to join the network, Dragonchain runs an incubator that plans to provide technical, legal, and marketing advice to new projects.

You may remember this project from its Disney roots. Now the team is trying to bring the magic of blockchain to less sophisticated developers and make their dreeammms come trueeeeee.  

We have more great reports in the pipeline so stay tuned.


TBI's Compression Algorithm

The IRS website went down yesterday. On the last day to file taxes, the site accidentally told users to come back “December 31, 9999”. Works for me. (It is now back up and running, and we all get another day to file our taxes. A procrastinator’s dream.) Oh and CoinDesk had a great article in its tax series on why the "Penalties and Interest" strategy you're tempted by might not be such a bad option. As long as you owe less than $50k the IRS pretty much rubber stamps installment plans. NYTimes | CoinDesk  

NY A.G. Schneiderman Launches Inquiry Into Cryptocurrency Exchanges. Yesterday, New York Attorney General Eric Schneiderman launched the "Virtual Markets Integrity Initiative" and sent letters to 13 virtual currency exchanges requesting disclosure of key information about their operations. The exchanges include Coinbase, Gemini, Bitfinex, Bitstamp, Bittrex, Circle, Binance, Huobi, Kraken, and a few others. The AG is looking into the operations, controls, and safeguards of the exchanges, and asks the exchanges to list each fiat, token, financial instruments, and virtual currency that is listed on its exchange (looking at you, Bifinex). State regulators in the U.S. are watching and ready to make moves, and New York is especially aggressive. NYS AG's Office

Cambridge Analytica’s ICO launch plans. Cambridge Analytica (the company that took all your personal information from Facebook and sold it to throw the US election) has been developing its own native token for an planned ICO. The company had planned to use its “psychographic profiles” of voters and consumers to inflict government control and private corporate control over individuals. Some use cases for their token: provides incentive for people to fill out surveys and essentially giving away more of their personal data. There is evidence Cambridge Analytica has been working with Dragon Coin behind the scenes, though both deny it. It is unclear whether or not Cambridge Analytica is still pursuing the ICO. NYTimes 

Department of Justice indicts NY resident for crypto fraud. Blake Kantor, also known as “Bill Gordon,” was indicted on three counts by the DOJ in the Eastern District of New York. Through Blue Bit Banc, Kantor solicited and took in approximately $2.1 million from approximately 713 investors in BBB’s binary options. Kantor then converted the funds from investors and invested it into “ATM Coin”, a worthless cryptocurrency that Kantor misleadingly told investors was worth substantial sums of money. Due to the involvement of binary options, the CFTC is also conducting a parallel investigation. Added bonus: the IRS is also involved here, because Kantor did not pay taxes on the illegal gains. Justice Department

Quick Bits (Don’t read that, I read it for you)

Choke Points (Exchange news)
+ India-based exchange, Coinsecure, is committed to refunding its customers after recent theft. No promises the refund will be in crypto, though. 
+ LocalBitcoins, the P2P crypto exchange, is now demanding ID verification from previously anonymous users with significant trading activity.  

Startup Signals (ICOs, Cryptos, and Startups)
+ Consensys’s Balanc3 platform, which seeks to streamline the financial and accounting process for token companies, released data from its beta program with 30 token projects.
+ Following Russia’s Telegram ban last week, Telegram’s CEO created bitcoin grants for administrators running virtual private networks (VPNs) and other proxy services to allow users access to the platform.

The Powers That Be (Legal/Reg/Policy)
+ The Korean Blockchain Association revealed a self-regulatory framework for its member cryptocurrency exchanges. Beginning next month, the Association will examine its 14 member crypto exchanges for compliance with the set out rules, including Bithumb, Upbit and OKCoin.  
+ According to its latest disclosures in an 10-K annual report, NASDAQ-listed Riot Blockchain received a subpoena from the SEC requesting “certain information”. So much for a full disclosure.

BigCo Noise (Enterprise initiatives)
+ Amazon won a patent to build a real time transaction dashboard to include cryptocurrency transaction data generated on their marketplace platform.
+ Huawei unveiled its new Hyperledger-based platform, Blockchain Service, which can be used for supply chain management, tokenized securities issuance and public services like ID verification and financial auditing.
+ Crypto wallet hires former Goldman Sachs executive Breanne Madigan as their head of institutional sales and strategy.  
+ One more loss for Wall Street. Alesia Haas, the former CFO at Och-Ziff Capital Management, joined Coinbase as their new CFO.

Did I miss something big?

Send me the link, your twitter handle and your best imitation compression algorithm write up. If I really whiffed, I’ll include your bit tomorrow (with attribution).


Shameless Plugs

Hit me up when I'm in your city!

Upcoming Travel:
+ Boston (4/25-4/27 - Pillar VC's Unchained) 
+ SF (5/1-5/3 - private event)
+ NYC (5/10-5/17 - Fluidity, Ethereal, Consensus, Token Summit)
+ Asia (Japan, Korea, Hong Kong early through mid-June)

My company, Messari, is hiring:
+ Front-end developer, blockchain engineers, data engineers
+ Volunteer analysts and summer interns
+ Content curation lead (compression algo tinkerer)

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