We need to act now to protect investors and the global financial marketplace from the severe risks posed by crypto-assets and must not be distracted by technical obfuscations which mask an abject lack of technological utility. We thank you for your leadership on financial technology and regulation and urge you to consider our objective and independent expert judgments to guide your legislative priorities, which we remain happy to discuss anytime.
A lot has changed in the state of crypto since we started investing in the area nearly a decade ago.This report is the first of what will be an annual overview of trends in the crypto industry, shared through the a16z crypto vantage point of both tracking data and across the countless entrepreneurs and builders we meet. It’s for anyone who seeks to understand the evolution of the internet, and where we are on the journey towards a decentralized, community-owned-and-operated alternative to the centralized tech platforms of web2 – especially as it touches creators and other builders.The top themes are distilled into five summary takeaways below, but be sure to dig into these 50+ slides (full deck for the 2022 State of Crypto Report available for download below); be sure to also sign up for the a16z crypto newsletter to continue getting insights as well as updates about upcoming resources.5 key takeaways#1 We’re in the middle of the fourth ‘price-innovation’ cycle
Candidates are staking out positions on cryptocurrency, scrambling party lines and fanning fundraising concerns.
Bitcoin and its users employ a variety of obfuscation techniques to increase their financial privacy. We visualize a representative selection of these techniques in Figure 1 based on their time of invention/creation and our assessment of their similarity to obfuscation vs. cryptography. We make several observations. First, techniques used in Bitcoin predominantly fall into obfuscation, with stronger techniques being used exclusively in alternative cryptocurrencies (altcoins). Second, there is a trend towards stronger techniques over time, perhaps due to a growing interest in privacy and to the greater difficulty of developing cryptographic techniques. Third, obfuscation techniques proposed at later points in time are seeing less adoption, arguably a result of their increased complexity and need for coordination among participants (Möser & Böhme 2017).
HSBC aims to shift $20 billion worth of assets to a new blockchain-based custody platform by March, in one of the biggest deployments yet of the widely-hyped but still unproven technology by a global bank.
The platform, known as Digital Vault, will give investors real-time access to records of securities bought on private markets, HSBC (HSBA.L) told Reuters, and seeks to capitalize on booming interest in such investments by yield-hungry investors.
2019 CIGI-Ipsos Global Survey Highlights 1. Social media companies were second only to cyber criminals when it came to fueling online distrust.75% say social media companies are responsible for their online distrust In the 2019 survey, social media companies emerged as the leading source of user distrust in the internet — surpassed only by cybercriminals — with 75% of those surveyed citing Facebook, Twitter and other social media platforms as contributing to their lack of trust. People from Canada and Great Britain, at 89%, were the most likely to point to social media as a source of their distrust, followed by Nigeria (88%), the United States (87%) and Australia (83%). People from Japan (49%), Tunisia (60%), Hong Kong (63%) and Korea (64%) were the least likely to do so. Almost nine in ten (88%) North Americans who distrust the Internet cited social media as responsible for their distrust, the highest proportion out of all regions surveyed. While cybercriminals, cited by 81%, remained the leading source of internet distrust, a majority in all regions (62% globally) indicated that a lack of internet security was also a significant factor — up significantly from 48% in 2018. 2. More than half of those concerned about their online privacy say they’re more concerned than they were a year ago.53% are more concerned about their online privacy than they were a year ago Eight out of 10 (78%) people surveyed were concerned about their online privacy, with over half (53%) more concerned than they were a year ago, marking the fifth year in a row that a majority of those surveyed say they feel more concerned about their online privacy than the previous year. Fewer than half (48%) believe their government does enough to safeguard their online data and personal information, with the lowest confidence levels in North America (38%) and the G-8 countries (39%). Citizens around the world are increasingly viewing their own governments as a threat to their privacy online. In fact, more people attributed their online privacy concerns to domestic governments (66%) — a majority in nearly every region surveyed — than to foreign governments (61%). While 73% said they wanted their online data and personal information to be stored in their own country, majorities in Hong Kong (62%), Indonesia (58%), Egypt (58%), India (57%), Brazil (54%), and Mexico (51%) said they wanted their online data and personal information stored outside of their country. In contrast, only 23% of North Americans, 35% of Europeans and 32% of those in G-8 countries shared this sentiment. 3. A majority admit to falling for fake news at least once — citing Facebook as the leading source — and want both governments and social media companies to take action.86% have fallen for fake news at least once 86% said they had fallen for fake news at least once, with 44% saying they sometimes or frequently did. Only 14% said they had “never” been duped by fake news. Facebook was the most commonly cited source of fake news, with 77% of Facebook users saying they had personally seen fake news there, followed by 62% of Twitter users and 74% of social media users in general. 10% of Twitter users said they had closed their Twitter account in the past year as a direct result of fake news, while 9% of Facebook users reported doing the same. One-third (35%) pointed to the United States as the country most responsible for the disruptive effect of fake news in their country, trailed significantly by Russia (12%) and China (9%). Notably, internet users in Canada (59%), Turkey (59%) and the United States itself (57%) were most likely to say that the United States is most responsible for the disruptive effect of fake news in their own country, while users in Great Britain (40%) and Poland (35%) were most likely to point to Russia, and users in Hong Kong (39%), Japan (38%) and India (29%) were most likely to blame China. A majority of internet users around the globe support all efforts that governments and internet companies could take to combat fake news, from social media and video sharing platforms deleting fake news posts and videos (85%) and accounts (84%) to the adoption of automated approaches to content removal (79%) and government censorship of online content (61%). 4. Distrust in the internet is causing people to change the way they behave online.49% say their distrust has led them to disclose less personal information online Nearly half (49%) of those surveyed said their distrust had caused them to disclose less personal information online, while 43% reported taking greater care to secure their devices and 39% said they were using the internet more selectively, among other precautions. Conversely, only a small percentage of people reported making use of more sophisticated tools — such as using more encryption (19%) or using technical tools like Tor (The Onion Router) or virtual private networks (VPNs) — to protect themselves online. 5
In sum, the blockchain back end shouldn’t matter to users – just like the Internet’s DNS or TCP/IP protocols don’t matter to web users. All web users care about is their web-based applications. All Blockchain users need to care about is their decentralized applications.Make no mistake: The days of seamless blockchain interoperability at the ‘atomic’ level are not here yet. Nor are the days of cross chain functionality where a single smart contract can update multiple blockchain platforms using a single process. We won’t see these needed functions go mainstream for at least two years.But the good news is we are seeing some very promising developments that will help move us closer to this end state, as highlighted in our recently published Hype Cycle for Blockchain Technology 2019.source: Hype Cycle for Blockchain Technology, 2019
ARTICLE 19 has issued a warning about the promotion of blockchain technology as a solution to censorship. In a report published today, the freedom of expression organisation identifies some of the risks that arise from the use of blockchain technology. It also identifies steps that states, public organisations and tech companies should take to ensure that human rights are protected when this technology is used.
Areas of law covered include:
1 Government attitude and definition
2 Virtual currency regulation
3 Sales regulation
5 Money transmission laws and anti-money laundering requirements
6 Promotion and testing
7 Ownership and licensing requirements
9 Border restrictions and declaration
10 Reporting requirements
11 Estate planning and testamentary succession
The GLI to: Blockchain & Cryptocurrency Regulation 2019 covers government attitude and definition, cryptocurrency regulation, sales regulation, taxation, money transmission laws and anti-money laundering requirements, promotion and testing, ownership and licensing requirements, mining, border restrictions and more