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Revisiting the Thesis for Decentralization

Check out past issues of the newsletter along with more interesting crypto content as well as short (

Satoshi&Co Daily Crypto Newsletter

March 18 · Issue #143 · View online
ZPX | Satoshi&Co Newsletters

Check out past issues of the newsletter along with more interesting crypto content as well as short (but great) conversations with leading crypto industry participants at our newly-launched website

First of, a big thank you for making the Satoshi&Co newsletter one of the more popular crypto blogs out there. We just got featured in BitStock’s Top 6 Crypto blogs to follow. All the more reason to share it with someone you know who might enjoy reading this.
Every once in a while, just so that we don’t miss the forest for the trees, we zoom out, get back to first principles, and revisit why this is all so important. ‘This’ of course refers to decentralization and everything that decentralization has engendered over the past decade or so, ever since Satoshi Nakamoto’s white paper. The speed and the impact of these changes are far beyond what someone like Alvin Toffler might have imagined in Future Shock.
As anyone with a passing knowledge of bitcoin and cryptocurrencies will have you know, DLT (Distributed Ledger Technology) solves the problem of trust by opting for a distributed consensus system. You have the blockchain structure, the consensus mechanism and the reward mechanism for the network participants. The cost of shifting from a deeply-entrenched fiat system to a completely decentralized world of cryptocurrencies is not a trivial task. Deploying incentive structures that can cause users to surmount ‘switching cost’ barriers and defect is one of the key aspects of cryptocurrency design.
In today’s newsletter, we have a guest piece on incentive structures in a centralized fiat world and crypto world authored by Arjun Chauhan, Varun Vruddhula (@GandalfTheBr0wn)and BKS (Balaji K Srinivasan). BKS ( ull disclosure - one of ZPX’s earliest supporters), along with Balaji S Srinivasan (@Coinbase/A16Z/ co-founded and exited a company called Counsyl, and were at Stanford at the same time, before falling down the crypto rabbit hole together fairly early in the cycle.
“Why should we care?  Why does computer money have value?  What is Fiat money?“
Some fundamental questions regarding economics, monetary policy, game theory, and computer science are explored in a new fascinating blog series, A universal framework for understanding incentive design in crypto and fiat systems.
Selected excerpt: In order to change a prevailing extant system, one must first understand the system itself and that it is the nature of the system to resist a change. To solve the Coordination Problem, one must first understand clearly (a) how existing third-party enforcement rule systems work to create trust and (b) how the Bitcoin solution and its proposed decentralized governance system can provide a clear advantage to network users over Fiat at the level of incentive design.
What we found useful in the ongoing viksavaakya is a universal framework that can bring clarity and fine-tune our approach to enable such a transition and successfully create a decentralized economy.”
Read the full story here. You might have to read this a couple of times to completely ‘grok’ the essence of it tbh, but is well worth it.
Meanwhile in Crypto Wonderland....
“Kakao to Integrate Crypto for its Users”
According to fnnews, a mainstream financial media outlet in South Korea, Kakao is integrating crypto for its 44 million local users. Local publications have reported that Kakao is estimated to have raised $90 million to develop its own blockchain network called Klatyn and the integration of a crypto wallet into KakaoTalk is one way to introduce their own blockchain network to the public. For now, Kakao is said to be considering an opt-in method to enable cryptocurrency and blockchain services. Simply put, users will have control over the presence of the crypto wallet on the messaging app.
“Israeli Court Prevents Bank From Closing Miner’s Account”
A court in Israel has once again ruled against a local bank which tried to close the account of a cryptocurrency related business without any due cause. This time a Tel Aviv court has determined that a bank can’t refuse to operate an account on behalf of a crypto miner. Union Bank of Israel, Ltd., the sixth largest Israeli bank, will not be allowed to close the account of local cryptocurrency mining company Israminers Ltd. Tel Aviv District Court Judge Limor Bibi has ruled that the bank’s sweeping policy of prohibiting the opening of an account for any customer working with digital currencies is unreasonable.
“Citi’s U-turn on Their Own Cryptocurrency”
Citibank is not following in the footsteps of JP Morgan with the creation of its own cryptocurrency, believing there are better ways of making improvements to existing financial transaction systems. The bank has been trying to get its blockchain-based “Citicoin” off the ground for some time. Rumors first surfaced about it all the way back in 2015. It seems that Citibank decided to take a step back from cryptocurrencies to focus on short-term gains.
“Another Twist in the Quadriga Debacle”
The law firm representing Quadriga Fintech Solutions Corp. is withdrawing amid concerns about a potential conflict of interest, the latest twist to the strange story of the shuttered Canadian cryptocurrency exchange. Stewart McKelvey, a law firm with offices across Atlantic Canada, was representing both Quadriga and the estate of its deceased chief executive officer, Gerald Cotten, who took to his grave the passwords to unlock more than $140 million in cryptocurrencies in December.
Crypto Twitter Pick
Ryan Selkis
UBI = QE for main street

Universal basic income is worth trying when:

+ No politicians have a spine
+ Economists are proud the USD is our "leading export"
+ Student debt and college grad underemployment at ATHs, while savings and home ownership are plummeting

Long UBI & BTC!
What We Are Reading / Listening To
Overnight Performance of Top 10 Currencies
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This newsletter does not constitute an offering of securities in any jurisdiction. The contents of this note should not be construed as investment advice or as a recommendation to purchase securities. This note is intended for the consumption of the recipient alone and not for public distribution. Please consult a certified financial advisor or other appropriate practitioner as may be appropriate as per your jurisdiction.
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