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Ethereum co-founder Vitalik Buterin defends DAOs against critics

Buterin believes collusion and corruption can be minimized when deciding power is in the hands of the entire group, rather than an individual or small…

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Buterin believes collusion and corruption can be minimized when deciding power is in the hands of the entire group, rather than an individual or small minority.

Ethereum co-founder Vitalik Buterin has come out swinging in defense of Decentralized Autonomous Organizations (DAOs), arguing that in some circumstances they can be more efficient and fairer than a traditional corporate structure.

In theory DAOs are collectively owned and managed by their members and have no central leadership. All decisions relating to aspects such as the usage of treasury funds or protocol improvements are made via voting on proposals submitted to the community.

In the lengthy Sept.20 post on his website, Buterin outlined that critics often argue DAO governance is inefficient, that DAO idealists are naïve, and traditional corporate governance structures with boards and CEOs are the optimal methods for making key decisions.

However, the Ethereum co-founder believes "this position is often wrong" and argues even naive forms of compromise are on average likely to outperform centralized corporate structures in certain situations. Although, he does believe it depends on the decision type which he says fall into two categories; convex and concave.

Examples of convex decisions include pandemic response, military strategy and technology choices in crypto protocols. While concave decisions include judicial matters, public goods funding and tax rates.

"If a decision is concave, we would prefer a compromise, and if it's convex, we would prefer a coin flip," he wrot

According to Buterin when decisions are convex, decentralizing the decision making process can lead to "confusion and low-quality compromises," however when they are concave, "relying on the wisdom of the crowds can give better answers."

"In these cases, DAO-like structures with large amounts of diverse input going into decision-making can make a lot of sense."

DAOs usually embrace decentralization to defend themselves from external attacks and censorship. Due to the nature of the space, and the remote and online nature of some projects, it can be more difficult to “do background checks and informal in-person ‘smell tests’ for character.”

Buterin argues this is exactly why DAOs are necessary, arguing the decentralized world needs to “distribute decision-making power among more deciders, so that each individual decider has less power, and so collusions are more likely to be whistleblown on and revealed.”

He does concede DAOs are not without their issues though. In certain situations, a more centralized structure is required, such as when an organization operates with a central core leadership and has separate groups all working independently.

The core leadership is decentralized, but Buterin says it can be necessary for the individual groups to follow a clear hierarchy, adopting a "clear opinionated perspective guiding decisions."

Related: Ethereum co-founder Vitalik Buterin shares vision for layer-3 protocols

"A system that was intended to function in a stable and unchanging way around one set of assumptions, when faced with an extreme and unexpected change to those circumstances, does need some kind of brave leader to coordinate a response."

Buterin elaborates further, saying in some cases, DAOs may need the "use of corporate-like forms" to "handle unexpected uncertainty."

He concludes by saying that for some organizations, even in a crypto world that “much simpler and leader-driven forms of governance emphasizing agility are often going to make sense.”

“But this should not distract from the fact that the ecosystem would not survive without some non-corporate decentralized forms keeping the whole thing stable.”

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Crypto in everyday life including travel documentation and visas

The global financial crisis in the past year or so has resulted in a spike in crypto adoption around the world. Cryptocurrencies have shown great potential…

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The global financial crisis in the past year or so has resulted in a spike in crypto adoption around the world. Cryptocurrencies have shown great potential of being an effective solution for inflation despite the effects of the current macro environment.

More and more people ranging from financial novices to professionals and institutions have jumped onto the crypto bandwagon over the past few years.

Crypto in most facets of everyday life

A few years ago, it would be laughable to imagine a world where different cryptocurrency platforms would become household names. But all that has changed and crypto platforms especially crypto exchanges are increasingly partnering with popular brands around the world. An example is Crypto.com which had the famous home of the Los Angeles Lakers renamed to “Crypto.com Arena” before later being named the Official Sponsor of FIFA World Cup Qatar 2022.

Cryptocurrencies are also increasingly becoming a valid medium of paying for goods and services. Crypto service providers have started offering debit/credit cards in partnership with Visa and MasterCard thus allowing users to use their cryptocurrency holdings in paying for everyday items.

Retail shops and service providers are also started accepting cryptocurrency payments solidifying cryptocurrencies as a valid form of currency.

Crypto in the food and beverage industry

For example, in the UAE, food and beverage giant 7 Management has made it possible for customers to pay with crypto at all of their locations throughout the country. It currently accepts payment with major cryptocurrencies like Bitcoin, Litecoin, BitcoinCash and Ethereum, although it will most likely expand the list in future.

Countries like Australia and the USA have also seen coffee shops and cafés accept cryptocurrency as payment besides accepting mainstream payment methods, such as cash, debit cards, and credit cards like Visa or Mastercard. Some even employ the concept of cryptocurrency as inspiration for their Menu.

Crypto Coffee, a local café in Brisbane, Australia, for example, derives the names of their menu items from different crypto coins. Its menu features items like the BTC Chipotle Chicken Toastie and Doge BLT. 

Crypto in the travel industry

The travel industry is one of the industries that has benefitted most from crypto payments with many travel companies and agencies now accepting the use of cryptocurrencies as a method of payment while travelling in certain countries.

Earlier this year, 1inch Network announced a partnership with the famous Binance-backed online travel agency Travala.com. Travala has been at the forefront of accepting crypto payments with the latest being the acceptance of Shiba Inu (SHIB). The collaboration is a huge step towards boosting crypto use in the travel industry since travellers can now book with different types of cryptocurrencies. Travala.com joined Destinia, which is another widely known booking service that has been accepting BTC payments since 2014.

With the growth of digital nomads and the reopening of borders now that the brunt of the pandemic has passed, there have been a lot more open discussions about the future of travel in general. However, the economic meltdown that has majorly affected the tourism and travel industry has most countries looking for new and innovative ways of inspiring tourism and spending.

Crypto in travel documentation and visas

While using cryptocurrencies when travelling has become more mainstream in the past few years, travel documentation still has a long way to go in fully adopting the use of cryptocurrencies as proof of income.

Currently, the UK government states clearly that Bitcoin is not an accepted form of currency when it comes to proof of income. In the US, although some financial sectors are slowly beginning to allow virtual currency as proof of income, crypto acceptance in applying for visas or ESTAs is a bit slow. In Schengen countries, the general consensus is that currently, only fiat bank statements are reliable proof of income. 

A representative of the European Commission, Laura Bernard, confirmed that traditional bank statements were still necessary, but added that since visas are processed on a case-by-case basis, that there truly wasn’t a rule that fits every single person’s situation. This implies that virtual assets might be useful in grasping the full picture.

Marc Piercey, one of the heads of the New Zealand Immigration Department, recently mentioned that there is technically no actual ban on using cryptocurrency as fiducial proof, but did indeed say that ultimately it is easier for visa applications to use fiat-oriented methods of proof.

In general travel documentation and visas still have a long way to go when it comes to the acceptance of cryptocurrencies.

The post Crypto in everyday life including travel documentation and visas appeared first on Invezz.

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Research: After September bloodbath, historically bullish Q4 could ease the pain

Since the beginning of the year, the traditional financial market has been on a steady downward spiral.
The post Research: After September bloodbath,…

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Since the beginning of the year, the traditional financial market has been on a steady downward spiral. Russia’s invasion of Ukraine seems to have acted as a spark that ignited the problems that have been piling up since the beginning of the pandemic, devastating most assets in its way.

According to data from Bloomberg, almost $60 trillion has been wiped out from the total market cap of U.S. equity and fixed income since February. The current drawdown exceeds the market downturns seen at the beginning of the pandemic in 2020 and during the Great Financial Crisis in 2008.

Graph showing the drawdown in total market capitalization of U.S. equity and fixed income bonds (Source: Bloomberg)

Bitcoin hasn’t been immune to the macro factors that have been devastating the tradfi markets. After the collapse of Terra (LUNA) in June, Bitcoin failed to recover and has been on a turbulent path of brief upswings and sharp corrections.

bitcoin btc price 2022 september
Graph showing Bitcoin’s price in 2022 (Source: CryptoSlate Bitcoin)

However, Bitcoin’s lack of upward momentum could be short-lived. September has historically been the worst month for Bitcoin — it failed to close the month in the green since 2016. Last month, Bitcoin closed the month at -3.1%, well below its monthly average of -5.01%.

October, on the other hand, has historically marked the beginning of a bullish quarter for the cryptocurrency, with Bitcoin’s monthly average close standing at 26.39%. It has also historically been the second-best month for Bitcoin, as it posted an accumulated total increase of 369.5% since 2009. The entire fourth quarter also saw historically positive closes.

bitcoin btc average monthly close september
Table showing the average and total monthly closes for Bitcoin from 2009 to 2022

A September bloodbath is a recurring theme in the world of traditional finance as well. Since 1946, the S&P 500 posted negative year-to-date returns in the third quarter 23 times. Out of the 23 negative third quarters the S&P 500 saw, around 70% were followed by a fourth quarter with positive returns. During a year with midterm elections, this number rose to 89%.

s&p 500 quarterly close market september
Table showing historical quarterly closes for the S&P 500 (Source: Hirsch Holdings Inc.)

If both markets continue their historical patterns, we could see the pressure decrease as October closes and a comeback of positive returns. However, with global macroeconomic factors continuing to worsen and putting more pressure on both markets, there’s an equally high probability that these patterns could break.

The post Research: After September bloodbath, historically bullish Q4 could ease the pain appeared first on CryptoSlate.

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GameFi could be the answer to unemployment for some: Aussie game studio

The executives say traditional jobs are increasingly at risk through factors such as automation, but GameFi can provide a viable alternative to earn a…

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The executives say traditional jobs are increasingly at risk through factors such as automation, but GameFi can provide a viable alternative to earn a wage.

Australian-based Web3 game studio Ninja Syndicate’s CEO and founder believes GameFi could usher in a new era where users can earn a living wage through blockchain games.

Speaking to Cointelegraph, founder John Nguyen and CEO Alex Dunmow say that traditional jobs are increasingly at risk through factors such as automation.

According to the game developers, blockchain games can and are playing a vital role for people to earn a living in the digital world through play-to-earn (P2E) and move-to-earn.

The process often requires significant work, but Dunmow says many mainstream triple-A games already feature “grinding for hundreds of hours,” though the assets “provide no value for the player.”

In GameFi titles digital assets can come in the form of nonfungible tokens (NFTs): Users can then take them to a marketplace and sell them for fiat currency or crypto, essentially earning a wage through gaming, argued Dunmow:

“NFTs can give you the technical ability to take ownership of a game asset out of the control of the publisher of the game.”

One of the best examples Dunmow has seen of people making a living through GameFi was a 2021 report about a community in the Philippines who turned to NFT gaming during COVID-19, which was now causing a shortage of workers in low-paying jobs as they could earn wages playing blockchain games instead:

“I saw the whole situation as a positive, a group of people who were likely being exploited in their low-paying day jobs, have found a way to earn wages in the Metaverse.”

Dunmow and Nguyen say the negativity around NFTs and blockchain in gaming present a challenge, but through their games, they hope to “subtly educate people about the benefits of NFTs.”

The game studio has been developing a set of blockchain games under the Supremacy World ecosystem, which involves building, fighting and mining resources within a fictional dystopian world where factions use giant mechs to fight for territory and power.

Supremacy will eventually combine four games, a battle arena that is already out, a first-person shooter (FPS), an MMO and a real-time grand strategy (RTS) game.

Through the series of four interoperable games, the executives said they are creating an ecosystem where players have “sovereign ownership” over their digital assets and can use them in whatever way they want, explaining: 

“What interoperable boils down to is being able to share digital assets between games.“

However, Nguyen noted that this interoperability also can also extend to “other game worlds, DeFi and PFP collection.”

“Supremacy will give people who own an NFT, whatever it may be, in-game assets in our world,” said Nguyen, adding that they recently were given a chance to design a custom mech skin for a user based on his Bored Ape Yacht Club brand NFT, noting that he can now connect his ape and claim his custom skin based on his NFT. 

Although given the time and resources required, Dunmow acknowledges they won’t be able to custom design something for every user, but he says it shows what is possible.

Related: Illuvium co-founder shares plans for new ‘interoperable blockchain game’ model

Dunmow said that at the heart of their game, they’re still trying to build a “fun game” which he believes is vital to the industry’s survival, adding that, “attracting players from outside the crypto space is crucial, especially in bear markets:”

“You make a fun game that has blockchain elements and attracts mainstream players; you are now disconnected from market forces, and you'll be able to survive any recession.”

On Oct. 5, Ninja Syndicate announced a new deal with NFT minting and trading platform Immutable X allowing them to build on Immutable X’s layer-2 ecosystem, joining projects including Illuvium, Gods Unchained and GameStop. 

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