Category: Blockchain

Industries are looking for the profit in blockchain

On By mehranmuslimiblogIn BlockchainLeave a comment

JP Morgan’s CEO Jamie Dimon may have said unflattering things about bitcoin and cryptocurrency generally, but his bank is pursuing the profit in blockchain technology.

Bank consortium and blockchain

Back in October 2017 the bank, which just happens to be the biggest in the USA, revealed that it and several other banks were conducting tests with sending payments using blockchain technology. The banks acknowledged that using decentralised ledger technology (DLT) would simplify the process and reduce the time involved in the process from “weeks to hours.”

The group of banks, now naming themselves the Interbank Information Network (IIN) grew in number, all of them seeking to leverage the power of the blockchain. Some have been testing the use of Ripple’s technology, while others have been exploring Hyperledger and the Enterprise Ethereum Alliance platforms.

Some see it all as a way of getting media attention: mention ‘blockchain’ in your press release and the story is bound to find its way to print is the thinking. But Michael del Castillo at Forbes, writes that there is a little-known economic principle powering the phenomenon. He refers to a research paper from Prysm: “Called “hold-up,” the principle dictates that when an individual invests in a group project, that investment is worth more as part of the group than outside it, giving others bargaining power equal to the investment.”

Tackling the ‘hold up’ principle

He describes the principle as being similar to the ‘hold up’ in a bank robbery. He says, “Like an old-fashioned bank robbery, the unlucky investor can essentially be “held up” for the value of the funds and other resources invested in the group and forced into undesirable situations, discouraging participation in the consortium at all and undermining even the greatest potential benefits.”

What he is getting at is that blockchain removes the ‘hold up’ situation. In the IIN consortia using blockchain allows members to share data, “without requiring that they hand over control of the actual data itself, where it could be easily copied and drained of its value.” As del Castillo sums it up, “As a result, competitors linked together via a blockchain are free to invest in common goals, and if they choose to leave the group in the future they can take their data with them as easily as one moves a bitcoin.”

And there is money to be made from it. Research company Gartner estimatesthat the business value locked up in these blockchain consortia and elsewhere in the industry will reach $3.1 trillion by 2030.

It is not only banks that are forming blockchain consortia. Across the medical industry there are new groupings emerging all the time, and the automobile sector is another.

Industry consortia want to solve blockchain snags

But there are still some snags to be ironed out, especially regarding the ‘hold up’ scenario. The Prysm research suggests that consortia creators identify past causes of hold-up in their industry and code smart contracts that account for them, and that the data is “structured in a way that is readable both on or off a blockchain, making it easier to not only integrate with other consortia, but leave them.”

Some answers, or remedies, that will allow competitors to work together more effectively are to be presented at Consensus 2019 this week. We are seeing progress in the adoption of blockchain that goes beyond it being confined to being the technology that has ‘something to do with cryptocurrency’.

Should we focus more on bitcoin’s use case than its price?

On By mehranmuslimiblogIn Bitcoin, Blockchain, crypto, EthereumLeave a comment

The crypto rollercoaster has morphed into ride with only slight dips and rises this month. It seems s if every few days traders need to take a rest and the bitcoin price sags a bit, The majority of the leading altcoins appear to follow what happens with bitcoin, although not uniformly.

As we head into next week, it’s hard to predict what we might see, although the weekends tend to bring some dips, suggesting that on Friday traders think about exiting the market for a couple of days. Jim Preissler writing at Forbessuggests: “Heading into the new week, expect possible dips to still be well supported at $4,700 in BTC and $154 in ETH. $5,800 and $187 could be tough resistance.’

As Preissler points out, XRP does not seem to have benefited from the latest crypto rally as much as BTC. ETH and LTC and there appears to be resistance at the $0.38 mark. ETH has been consistently outperforming XRP since February and it doesn’t look like there is going to be much change there.

Omkar Godbole at Coindesk suggests that what is needed to move the market along is a breach of BTC’s new resistance level of $5.200. As I write on 17th April, we have a slight glimpse of that as BTC touched $5,200.14. The market-leading cryptocurrency picked up a strong bid at lows below $4,200 on April 2 and jumped to 4.5-month highs above $5,300 on April 8, confirming a bullish reversal. However, over the last couple of days that rally paused, which Godbole attributed to BTC being overbought amongst other factors. But momentum seems to moving in an upward direction again. And, as Godbole has pointed out, “the longer duration outlook will remain bullish as long as prices are trading above $4,236.”

For the moment, bitcoin is trading above that level, but are we too focused on price?

As more real life use cases for bitcoin appear, such as the news that UK’s largest travel agency Corporate Traveller is now accepting bitcoin for payments, and the town of Innisfil in Ontario accepts BTC to pay property taxes, it is to be hoped that the public sees more advantages to using bitcoin for a range of payment purposes. That should encourage more belief in the cryptocurrency, and boost the number of people owning e-wallets and joining exchanges to purchase crypto. Slowly, slowly, cryptocurrency is edging forward toward mass adoption. We are a long way from that yet, but there’s no need to panic. It takes time to adjust to the new, even when the use case and the benefits are clear to a few. Just think back to the beginning of the Internet and the length of time it took the average consumer to feel comfortable with it. When people understand the benefits of using bitcoin and focus less on the price it is trading at, I believe that is when we’ll see a sea change in the crypto market.

Shining A Light On XRP Giveaway Scams

On By mehranmuslimiblogIn Blockchain, cryptoLeave a comment

If you follow the money you’ll inevitably find people who want to steal it. Scammers have been targeting owners of XRP, Ripple’s native token, and this has been increasing since December 2018, according to Thomas Silkjaerwriting for Forbes.

What is a giveaway scam?

The term ‘giveaway scam’ is yet another new term to enter the crypto lexicon. Simply put, the term covers attempts to defraud people by convincing them that if they send funds to a project they will get more back than they put in, typically via an ‘airdrop’. The scammers usually impersonate the customer support element of exchanges or other websites, but more dangerously, they put up fake profiles on social media channels, such as Twitter, Facebook and Telegram, the latter being the preferred channel for crypto-related projects and especially ICOs. Vitalik Buterin, the Ethereum founder, has been very outspoken about these scams, and not least because his name has frequently been used by scammers to set up fake accounts.

How to report fake accounts

There is a way to report these fake accounts. Go to Bithomp and you can submit what you think is the “scam/fraud XRPL account”. Bithomp then investigates the accounts and if they find that they are fraudulent, they “add a warning to their block explorer service and expose the addresses via an API.”

How many XRP giveaway scams are there?

Silkjaer looked into the XRP ledger to see just how many ‘bad actors’ have been involved in this activity. He identified around 150 accounts connected to scammers or potential scammers. The number of payments received totalled 1,830 and the amount received 2.8 million XRP. He believes that there are just two major scam groups involved in giveaway scams, because “some payment destination tags have multiple relations, meaning that the same destination tag has been used by more than one account.”

A bit of advice

So, here is the standard advice if you believe that you may be being targeted by XRP scammers: If the offer seems too good to be true, it probably is. Don’t send funds to an unknown address, or at least be cautious.

Are neuromorphic chips the future of AI and blockchain?

On By mehranmuslimiblogIn AI, BlockchainLeave a comment

There is no doubt that artificial intelligence (AI) is the driver of a revolution in automation akin to the influence of coal and factory machines on previous industrial revolutions. Jayshree Pandya, writing for Forbes, makes a very interesting point when he suggests that the increasing importance of AI also goes hand in hand with a need for more computing power.

He suggests, “There are indicators that raw computing power is on its way to replacing fossil fuels and will be the most valued fuel in the rapidly emerging intelligence age.” The question of course is — where will that computing power come from?

The need for more computing power

AI also needs massive amounts of data to produce useful tools. One of the sources of both power and data is potentially the blockchain. Alongside the much-needed power, blockchain technology can add structure and accountability to AI algorithms, “and may help in much-needed areas like security, quality, and integrity of the intelligence AI produces,” Pandya says.

What we are really talking about is Big Data. It is the fuel of AI and blockchain produces that fuel, so it is entirely logical that the two have a future together.

However, there is another important question to be answered. Can the current blockchain technology infrastructure support the needs of AI, when it appears to be struggling to meet its own needs?

Prof. Irving Wladawsky-Berger, a Research Affiliate at MIT Sloan School of Management offers some insights into the situation. He points to the environmental concerns about the amount of electric power blockchain technology uses, because of its core process and security, which necessitates that all users require permission to write on the chain. He believes the amount of computing power the blockchain requires is unsustainable, and that it is one of the most critical challenges facing the industry.

But it isn’t only blockchain that is fuelling the need for more computing power: it is AI and all emerging technologies. As these evolve, there needs to be a solution to this issue. As Berger says, “there is a need to not only process computation more efficiently but also to evolve both hardware and software to meet the demand for increased computing power.” The solution he points to, “is a clear need to move away from traditional blockchain chips to low energy, scalable, and sustainable chips.”

Neuromorphic chips

The answer may be neuromorphic chips. These do all the processing and functioning without having to send message back and forth to the cloud etc. In fact, they function in a similar way to the human brain, conserving energy by only functioning when needed. Berger believes, “neuromorphic computing chips will likely be the future of not only artificial intelligence but also of the blockchain, as they give us an ability to develop low energy consuming cryptocurrency as well as distributed systems.”

What he is also suggesting is that in recent years there has been more emphasis on developing software than hardware. He says, “Neuromorphic computing and chips bring the much-needed evolution in computer hardware,” and that if we follow through with developing this, then AI and blockchain can have a sustainable future together.

We know that the demand for AI is increasing rapidly, and we need to find a power source to feed that demand. It seems the answer is neuromorphic chips!