Ideas for Reddit moderation improvements

Awhile back the /r/Bitcoin community got upset over Coinbase CEO talking with Reddit CEO about /r/Bitcoin's moderation and the possibility of removing the moderators of the subreddit. It has been a few months and luckily not much has come of it. However, this got me thinking about how we could improve the moderation of the subreddit, or at least what different approaches could be taken.

None of the points mentioned are meant to be an attack on anyone - thy are merely ideas worth considering in probably many communities, not just ours.

This can be viewed as a continuation from the "On /r/Bitcoin moderation - three years in review" blog post.

Head moderator responsibilities

Everyone has different approaches to moderation. Personally, I find myself starting with a lot of enthusiasm early on and later petering out over time as more people join the team and are able to take on the responsibilities. Being the second moderator on /r/Bitcoin for a long awhile and facing the community backlash at our top moderator gave me an opportunity to think about how I would run things. While this might not be an ideal solution for everyone, here is the approach I might take - focus on being the moderator of moderators and an arbitrator between them, rather than dictating the direction of the subreddit.

My personal approach is that everyone makes mistakes - moderators are no different and I'm no different. The best approach to take is to fill the moderator positions with people that aim to support the community and see it grow. Most importantly, however, those people should be open to discussing and challenging views held by themselves and other moderators as needed. One person might make a mistake, but if five people agree on something, it is less likely to be a mistake. If someone disagrees, it is important that they express their reasoning and let their peers come to a conclusion whether something needs to change or not. Many of the /r/Bitcoin moderators, both past and present luckily are able and do voice their opinions even if it's not in line with the current rules.

Being the top moderator on Reddit gives one the power to control everything in the given community, but in my opinion that power should be used very rarely. Ideally, the top moderator of the subreddit would perhaps only step in if the other moderators are acting against the community and need to be removed. This could mitigate the use of moderation to push one's agenda - if the top moderator doesn't actively moderate, they can't change much to suit their agenda. Other moderators know that if they usurp the community, they will be removed. Thus some balance of power could be reached for the betterment of the community, provided the top moderator could be trusted.

Anonymous discussions

At times the moderators might need to discuss some matter anonymously. Perhaps it would be an issue of removing a certain mod or other controversial topic. Unfortunately, Reddit doesn't leave many options for anonymizing one's conversations while still being certain you're talking with the same group of people. However, here is a simple solution to this problem:

Every moderator would create a random account. They would message someone saying they are a mod, but not reveal their original identity. That person would gather the list of all accounts that messaged them and present the list to the moderation group. Everyone would then acknowledge that the account they created is indeed on that list (without disclosing which account it is). If everyone acknowledges their account being present and the numbers match, you have a list of anonymous account that can be used to discuss anything without worrying about negative repercussions to your other account.

Mod removals

Having the anonymous discussions, it becomes much easier to discuss the removal of fellow moderators in an objective manner. You might want to call someone out on some actions they have taken or their general behaviour and see how other mods feel about the situation without becoming "that guy".

One of the responsibilities for the head mod would be to make sure the proper mods are removed (in case say, they are the second most senior mod that nobody else can remove). But perhaps the biggest mark of greatness for the top mod would be recognising if the community and other mods would not want them to continue at their position and step down like a true Roman Dictator, having put the power in the hands of the next worthy person chosen by the community and the moderators.

Community oversight

Another topic I've heard mentioned a few times comes in the form of insight into moderation logs. While those could probably be disclosed fully, they rarely tell the whole story - a good deal of moderation happens over modmail, which sometimes needs to remain private. It might be good practice to perhaps appoint a few representatives of the community to oversee the moderation process without being full moderators themselves. They would have insight into modmail and moderation logs, but shouldn't be acting as a full moderator. This could reassure some people that the mods aren't conspiring against someone or some company in particular, and it would also provide a good pool of candidates to pick from in case the moderation pool needs to be expanded.

Talking with the community

Communication with the community is important. Whether it's announcing policy changes or just having a general talk once a month, it might be useful to reach out to the community and hear what they have to say. This could boost the community's confidence in the moderators, help address some issues early on and hopefully make the relationships between mods and redditors better than what it sometimes becomes.


Those are some of my thoughts on how moderation in Reddit as a whole could be improved, or at least how I would try to improve it given the chance.


OneCoin round 2 - it's all about the "family" and merchants

The saga of OneCoin continues. We've talked about the issues they might be running into with using big numbers for their currency, how market cap or coin supply is essentially meaningless, and now let's analyse the actual OneLife Mastermind Bangkok Event.

What was the event about?

Looking at the three hour long video of the event, there is a lot to cover. All of it strikes an uncanny resemblance to a Multilevel Marketing event:

We have a lot of pomp, a lot of hype, bragging, talking about how everyone is forming a giant "family" and asking them to start buying and peddling the newest product - merchant applications. There is a lot of small pieces of information here and there on how they envision their system working, and a lot of it raises red flags.

The event certainly packed a lot of showmanship - live musical performances, important sounding speakers and so on. I've been to a few cryptocurrency conferences already, and they are completely different - you hear a lot about the technology, new developments, etc., and there is a lot less cult of personality.

Merchant program

One of the more important but overlooked parts of the event was the news about OneCoin's new merchant program. There are two new packages being sold - one for $1000 that comes with one whitelabel application, and a $5500 one that comes with seven applications. OneCoin expects its members to purchase those applications and sign up merchants, giving them those applications. Their goal is to reach one million merchants in the coming years. With the merchant adoption, the coin is supposed to gain liquidity and value.

Why should the merchants join? To gain access to OneCoin's "family" and the network, and they incur no cost for the first year. The coin should be "very stable" and merchants "should prefer it to PayPal, Visa, Mastercard".

So yes, the merchant program is as they say "free", and by free, they mean it costs $1000 to the person that signs up the merchant. So the marketing and on-boarding the merchants falls on the coin users that also get to pay for the privilege. But at least you will finally have some place to spend your OneCoins, right?

Well, not quite. The merchants will be able to specify how many OneCoins they will be accepting. They can choose to accept, say, 20% of the payment in OneCoin and 80% from the user's Credit Card (conveniently connected to the account already). This implies that OneCoin doesn't even do the most basic thing that every Bitcoin payment processor does - sell the coins for the merchant and pay them in fiat.

So let's compare that to say, BitPay, one of Bitcoin's oldest payment processors. It allows you to sign up for free, it's free to use for some small volume transactions, or it costs the merchant 1% otherwise. You can accept Bitcoin for 100% of the purchase and you get all of your money in whatever form you want - BTC, wire, etc. For OneCoin, you need to have someone else pay $1000 for the application, sign you up, then you specify how much OneCoins you will be accepting for every transaction, then you have to figure out how to cash those out (without a real exchange yet), and you might be charged something after a year of using it.

So yeah, it doesn't look good - more like a barely serviceable product that you want your current members to buy and convince people to use to make their coin accepted somewhere and thus gain value. It's a good MLM strategy, but terrible usability strategy.

Other things

We've already covered the coin doubling event, so there isn't much more to cover in that regard. It's silly, watching people get excited for a 100% increase in coin supply without an increase in coin's value. So instead, here is a list of various pieces of information that were stated thorough the event:

  • There have been 14 million accounts created, with 2.5M active distributors
  • The price of the coin was 50 eurocents, now it is 9 euros, and they aim to get to 25 euros
  • OneCoin is launching some social media website called OneSaito, which will feature Groupon-like discounts. So it's like 2010
  • "To make sure we continue to produce coins, we need tokens, and tokens come from product packages"
  • They want to achieve critical mass in a year's time
  • "We will eventually move to the next stage when what we're doing will become self-evident" - do they mean people will catch on to the MLM structure?
  • "We don't want to create idiots"
  • "Any one of you could've launched Pokemon Go"
  • Whoever maxes out their 35k Euro contribution on the day of the event will have the opportunity to max out another 35k Euro contribution the following day
  • "So guys in Sofia, if you don't switch it on, we'll come for you and kill you, yeah? Always good to motivate the office too..."
  • OneCoin will be going into the remittance business (so they're joining the Bitcoin hype from a few years ago that has already been explored by 19+ companies?)
  • OneCoin will be going public in Q2 2018
  • OneLife has created 350 millionaires in its history. There were 450 diamonds in the event
  • OneCoin is a special network, because it acts "like a family"


OneCoin is quite obviously a MLM pyramid scheme. Quite brilliant actually - instead of peddling products people have to start storing in their garages and try to sell to other people, they are selling a "crypto" currency and telling everyone to buy as much as they can to raise it's value. They have virtually no production costs, therefore every dollar spend is essentially profit. Instead of investing that money into development of some actual products, like exchanges, payment processors, etc., they just get people to buy into the scheme more and more, to promote the coin further to drive the sales.

The most symbolic part of the event came in around 2:35. The speakers talk about celebrating OneCoin's second birthday with a cake, "the largest cake ever" - OneCoinCake. 2x2 meters in diameter. Unfortunately, since there were 11500 people in the audience during the event, "not everyone will get to taste the cake". This is perhaps a good analogy to how OneCoin works - everyone pays for the cake, you make a large cake, and the elites will stuff themselves while everyone else will only get to admire the cake from afar...

Related links:


Big numbers don't mean big money

Last week we discussed problems with using really big numbers in cryptocurrencies. This week I'd like to talk about misconceptions surrounding cryptocurrencies with big coin supply as well as inflation in cryptocurrencies.

Coin supply is a joke

Both this and the previous article were inspired by the OneLife Mastermind event, during which the people on stage were gushing about how many coins their system will have and can mine.

"The new blockchain will mine 50'000 coins per minute. [...] I think we are mining about 2'000'000'000 coins now."

In their previous event, they've stated

"Biggest coin out there is Ripplecoin [sic], with 100 billion coins[sic]", and OneCoin will increase its number of coins to 120 Billion to be bigger than Ripple.  

Focusing on the amount of coins you are mining or the coin supply is a joke. It's like praising Zimbabwe for producing 100T dollar notes, or the post WW1 Germany for having so much money you can build toy houses with them.

Market cap is deceptive

A lot of people rely on the market cap to determine which coin is the most valuable and worthwhile. Just have a look at CoinMarketCap. At the moment we have Bitcoin leading the market cap of about $10B, followed by Ripple at $1.2B.

Right at position number 2, we have an issue calculating the market cap - Ripple's available supply is listed at 35B XRP, although its total supply is shy of 100B XRP. If we calculated the market cap blindly, we should take the total supply and multiply it by the current price (0.0035 USD/XRP), which would net us $3.6B, rather than $1.2B.

The market cap is a poor metric for a coin with a highly-centralised supply. As Peter Todd jokingly put it - just mine a large amount of coins, sell a few of them at a high price and you've got a huge market cap.

It would be really hard to create some metric that can measure how valuable a cryptocurrency network is - market cap can be inflated, volume can be faked or hidden, you can't ever know how much of the coin supply is held by a handful of people with a million addresses, etc.

Inflation is not growth

In the past I've seen some deceptive advertising for a proof of stake coin that claimed it was a savings currency. They justified it by essentially saying - "buy our coin, then you can stake it and earn X% per year with it". While on surface it might appear so - if I start with 100 coins and at the end of the year I get 110 coins, then I'm 10 coins richer, right?

That works only on paper. If the market cap for the cryptocurrency remained unchanged and everyone got their 10% more coins, then you're right where you started - you own the exact same percentage of the economy as you used to. The inflation ate your earnings.

In economics, there is an important distinction between nominal and real interest rates. If I take a loan at 5% (nominal) interest rate, but the inflation is at 3%, then I effectively only pay a 2% (real) interest rate on the loan. Each year the principal of my loan has lower and lower purchasing power even if the number remains steady. The same is true for proof of stake inflationary coins - you're not earning anything with them, unless the pace of your earnings is faster than the overall inflation of the network.

A coin will only net you revenue if its equivalent of "real GDP" increases:

If you're not ahead, you're losing money

In an inflationary currency, if your supply of coins is growing slower than the average coin supply, you are essentially losing money. Earning 5% interest in a currency with 10% inflation means you are losing 5% on your investment in an ideal economy. In a real-life scenario, the markets would most likely be swayed a lot more by the speculation on the coin and whatever hype it can muster.

This point usually has low impact on most coins, but it seems to be exemplified with OneCoin's splits and tokens, assuming we would treat the coin as a real cryptocurrency and not a scam. In OneCoin, you can buy different packages that each come with a different amount of tokens and splits. If you buy the cheapest package for 110 EURO you get 1000 tokens and one split, but if you decide to spend 27'500 EURO, you get 300'000 tokens and three splits. This means that not only do you get about 20% discount on tokens when buying them in bulk, buy you can also split them more times (which I'm guessing would give you more mining tokens or something, I'm not sure). Because of this, if you're buying anything shy of the top-tier package, you're already falling behind. I guess that's why you can find a lot of "strategies" for buying the tokens everywhere...

Same goes for the doubling event, wherein everyone's coins got doubled (since 100% inflation equates to 100% growth or something...). If you missed that event, your purchases are only worth 50% of what they would've been before that event in proportion to the entire market. You can't ever catch up.

If you're late, you're paying the early adopters

Unless we're talking about cryptocurrencies with a flexible supply denominated in fiat, anyone adopting late is essentially paying the early adopters. In some cases, that's pretty justifiable - when Bitcoin was still fresh and nobody knew if it had staying power, you needed a lot of people to devote their time and energy into developing the infrastructure everyone relies on today.

However, if you look at something like OneCoin that relies heavily on hype and even pays you in a pyramid-like structure for referrals, you have to be really weary when buying into it.

This is why a lot of people in the crypto world despise premining and fast maturing coins - a few people hold a lot of coins and they get to reap the bulk of the money from anyone buying into the network. When the jig is up, they can cash out and it's the late adopters that get to hold the bags.

If OneCoin was an honest coin, I can see some people getting rich if and when the coin starts getting publicly traded and people can start dumping their coins. As it is now, it is likely that everyone with the coins will be holding the bags while the people behind the coin will be the one with the money.


Coin supply does not matter, market caps can be deceiving, nominal growth does not matter - only real growth, don't buy into scams.


Problems with big numbers in crypto - how Bitcoin dodged a bullet

Recently, the infamous OneCoin made news once more in the Bitcoin circles after their OneLife mastermind stream. One of the more interesting things mentioned was the previously announced blockchain reset, coin doubling and increase in coin generation speed. This is supposed to mean that OneCoin is getting more valuable, but once again, that's not how blockchain works - big numbers don't mean big money. But let's start from the beginning.

Bitcoin coin cap

As everyone knows by now, Bitcoin has a coin cap of around 21'000'000 coins. Each coin can be broken down into 100'000'000 satoshis, and that number can be further sub-divided in the future should the need arise. So for practical needs, Bitcoin has a final supply, and a nigh-infinite divisibility, as opposed to fiat currencies that are often nigh-infinite in supply, but finitely divisible.

The hidden genius of Bitcoin is very subtle when it comes to its coin cap and its precision that a lot of coin developers often miss entirely.

Sure, Bitcoin might not have a mathematically beautiful block reward (say, a power of 2 that halves every four years so that we can get a beautifully round number in the end), but it's still easy for programmers to work with. In financial computer science, precision is everything. A balance of $3.50 would not be represented in a database as a floating point number - those are imprecise. It would be an integer number, like 350 cents, or 35'000 hundredth of a cent if you need to get more precise. This makes sure that you can add, subtract and multiply those numbers all day long and you will always be right down to a penny.

Same goes for Bitcoin. Every transaction specifies exactly how many satoshis to transfer and to whom. The number is encoded in a 64 bit unsigned integer, meaning it can precisely express numbers between 0 and 2^64 (18'446'744'073'709'551'615). Even if you take all of the bitcoins that will ever exist and subdivide them into satoshis, you will get a number smaller than 2^51, meaning no matter how many coins you move back and forth, you will never lose precision or overflow the system. Moreover, the numbers can also be represented precisely with double-precision floating points (which has a precision of 2^52 for a fraction).

Other coins and their supply

Other coins have often toyed with different block reward schedules and thus different amount of coins.

Ripple is perhaps the most popular coin with a high coin supply, capping off at 100B XRP even. Their coins subdivide into 6 decimal places rather than 8 - this gives them an upper bound of under 2^57 units (if they instead went for 8 decimal places, they would be under 2^64 and wouldn't fit into signed integers). So they are fine in that regard, but they start to run into a problem when trying to express the units as floating points - they are only precise up to 2^52, or about 15 significant digits.

Same story with Dogecoin - currently sitting at 106B units with 8 decimal place precision, which is enough to start breaking the JSON API developers use. Bytecoin, sitting at 181B coins barely fits into 64 bit integers and FedoraCoin, the coin with the highest listed coin supply on CoinMarketCap breaks that limit with 438B coin supply, needing at least 66 bits to be fully represented.


So where does OneCoin sit in all of this? Lets assume they are like Bitcoin with 8 decimal places (and not just some made-up numbers in a spreadsheet...). They currently boast having 2B coins and mining 2.19B coins per month, giving us less than 2^58 - too big for doubles, but still manageable for ints. In about 85 months of mining, their coin supply will reach 185B and cross over 2^64. That is a long after they plan on "going public with their coin" in Q2 2018, whatever that would mean.


When designing a cryptocurrency, there are many hidden pitfals one has to keep in mind and try to avoid. One might be tempted to create a currency with large numbers to give off an illusion of value where there is none. However, for practical reasons, you want to keep the numbers in your system within a reasonable range so the developers working with your coin won't have to deal with numbers too big to represent.

OneCoin might still be in the clear, at least as clear as Dogecoin is, but one more "blockchain restart" coupled with increased mining speed and they will be soon crossing the computer science boundary, at least assuming the system is legitimate to begin with.

Next up - why big numbers don't mean big money...


DECENT - a torrent blockchain presale

Recently, I was contacted by a fellow Bitcoiner and informed about some possible shady goings-on on the DECENT platform. Reportedly, the platform has raised 5352BTC (3.2M USD equivalent) in its token presale, but the product appears to be on some shaky grounds. Lets have a look at what we can find out about the platform, the presale and have a look at whether there is something shady going on...

The Whitepaper

Any self-respecting blockchain project styles itself after Bitcoin and releases a whitepaper early on. Decent is no exception (#liberateyourself on every page...).

The paper starts with criticising Bitcoin for BOTH its low transaction throughput, and its large blocksize. Wouldn't it be nice if one could have a higher transaction throughput with a lower data footprint? Unless you start pruning old data, it won't happen. But that's apparently "some childhood diseases" Bitcoin has.

"Unfortunately, in spite of more than 6 years of its existence [Bitcoin] did not reach a position it could have attained mainly due to the imperfections in its architecture and design."

In comes Decent. Saving freedom of speech, solving the issue of authors having to figure out how to monetise their content, drive traffic to their sites, deal with Amazon's pay cut, etc. You can use it to publish "any text, picture, video or music content" (and even software) and "no third parties can control or influence the content".

The platform is characterised by being:
  • Independent - owned by the users and "will never be affiliated with any economic, media, or political party"
  • Borderless
  • Stable - not dependent on any single server
  • Fair - everyone starts at the same level and build up their reputation
  • Profitable - users can buy content directly from the authors and there is no cut taken by Decent
  • Spam Free - content publishing is expensive for spammers
  • Secure & Anonymous - authors can publish the content anonymously
  • Recommendations-enabled - readers that purchased the content can embed their feedback into the blockchain

While describing how the protocol works, we also learn that the application will be using the bittorent protocol with a distributed tracker to distribute its content. The torrent is downloaded by the "publishers" that charge a fee for storage and bandwidth. For encrypted content, the decryption keys are also distributed to the publishers.

Upon hearing what kind of content the platform will support, the cynic in me instantly reached two conclusions - a lot of the content, especially the movies and music, will be pirated like on current torrent websites, and a lot of the software content will contain malware. I somehow doubt I will be proven wrong...

So all in all, it looks like the system will use a blockchain to keep track of who paid for what content, while the actual content will be distributed over torrents. All in all, it looks like a poor man's version of MaidSafe or Storj, also somewhat similar to the Alexandria project. While those platforms focused on creating their own storage solutions paired with the blockchain, Decent appears to just mash Bitcoin and torrent technologies and produce something that's less than a sum of its parts.

A somewhat more usable solution would just focus on augmenting the torrent architecture without burdening it with a proprietary blockchain. You could use Factom or Ethereum to publish the magnet links, have some proof-of-payment solution to request the torrent data for paid content, or even just rely on donations from people that consume your content. Building one's own blockchain just to manage new tokens proves once again, a solution looking for a problem.

The token presale

Like a lot of projects in the crypto space, Decent is raising money through a token presale. To buy the tokens, you need to register an account on Decent's portal and pay bitcoins into a provided address. The tokens are distributed into the account and will later be available for withdrawal on the network proper. At the moment there doesn't appear to be an option of transferring the balance between accounts, so one is unlikely to be able to trade or sell the tokens before the network goes live.

Since it looks like Decent is handling all of the balances and not acting as a client-side wallet provider like Blockchain.info (that is, Decent probably handles all of the balances themselves), this can get really hairy for them from the regulators' perspective. Were they located in the USA, I would stay away from the service after what happened to Ripple Labs. Since the service does not seem to gather KYC information, it might be in a legal grey zone. Not being able to send the tokens around might actually be a benefit for the company - the token appears as a less of a security this way.

At any rate, the gathered bitcoins end up in 2-of-3 escrow with Coinbase. The three people responsible for handling the funds are:

  • Matej Michalko, the founder and director of Decent. Also, a co-founder of five different Bitcoin conferences (I suppose that is a new, fancy term for "organizer" nowadays), and a co-founder of two other crypto-related companies
  • Tibor Tarabek, reported to be the "Founder of Microsoft Slovakia", although his LinkedIn profile lists him only as a General Manager in years 1995-2000 (and also a "General Manager" of some "bitcoin, s.r.o." company between years 1992-1994, 16 years before Bitcoin was released!)
  • Vasylchenko Alexander, former director of Mycelium in years 2012-2014

It is a bit strange that the founder of Decent is a co-signer of the escrow if you want to show that you can deliver on the project's promises. Find a few reputable Bitcoin people and use them for the entire escrow to show the release of funds is unbiased. Currently, all you need is one of the two extra people to co-conspire and you have full access to the 3.2M USD. While I might not know the reputation of mr Tarabek in the Slovakian Bitcoin space, his apparent lack of involvement with Bitcoin-related projects doesn't speak well to his ability to objectively judge a project like this.

Lastly, storing token presale funds in Coinbase, a company known for helping US authorities shut down torrent-related websites, doesn't bode well for the security of the funds. No KYC, token presales and US don't mix well...

All in all, I'm very dubious about how well the presale is handled. While it's not completely shady, I would not be surprised if the tokens get released before the project is finished or worse. To anyone that has purchased the tokens so far - hope for the best, prepare for the worst.

The Team

All in all, what makes or breaks a project is often the team. Let's look at who the Decent team is compromised of...

The Founders consist of:

  • Matej Boda, who seems to be rather fresh out of university without much prior experience
  • Matej Michalko, the aforementioned co-founder of a lot of crypto-related projects. He appears to be business-focused
  • Wayman Kwan, a venture capitalist
So mostly business-focused founders. Let's look at the developers in the team:

  • Josef Sevcik, with background in Business Administration, Informatics and telecommunication
  • Bohdan Skriabin, a cryptographer still studying at a university
  • Lubos Novotný, an UX / designer
  • Stanislav Cherviakov, "a tech expert with a mathematical background" with experience in fintech, etc.
  • Vladimir Dubinin, a mathematician with a computer science degree
  • Anatoly Ressin, a programmer

And a lot of other advisers, ambassadors, etc. All in all, the development team is a bit mixed, having a few people that appear to have a lot of relevant experience, and some that are just starting out. The company also appears to be looking for a senior developer and a junior developer, both with a negotiable compensation payable in "other".

It looks like there are about 13 people making up the company proper. That can give the company a pretty high burn rate before any technical prototypes have been developed, but the costs may be rather low if the majority of the team is located in Slovakia.


So far, Decent doesn't appear to be publicly owning up to any publicly available repositories on their website. However, the bitcoiner that prompted me to investigate the company pointed me in a direction of a github repository posted by Josef Sevcik, one of the developers on the Decent Team. It looks like a possible prototype of the Decent platform. The codebase appears to be based on Peershares with a small amount of changes (a few file diffs: 1, 2, 3).

Basing the codebase on proof-of-stakes based currency informs a lot of new things about the project that haven't really been mentioned on the project's website - the initial allocation of tokens (how much is being kept by the company and developers) can be really important when it comes to earning block rewards for example.


All in all, the Decent looks like an underwhelming solution looking for a problem. It is very unlikely the platform will solve all of the problems it sets out to fix - nobody will want to switch over to a new platform, use a new currency to get a glorified paywall. Focus on presaling the tokens doesn't seem to be improving the solution, as is often the case. Raising 3.2M USD before anyone has seen a prototype of the platform is similarly ludicrous. The tokens have little to no value during the presale - you can't trade them for speculation, you will only be able to use them once the platform launches, and there doesn't appear to be any special use for the tokens in the final system other than paying for things. I somehow doubt the platform will have 3.2M USD worth of content on it for years to come, so pre-purchasing a token now to be able to pay a movie for a few dollars or a blog article for a few cents a year down the line sounds like an awful proposition.

The escrow holing the coins doesn't appear to be following the industry's standards. It is not completely shady, but it could inspire more confidence.

The team behind the project looks fine - no "blockchain rockstar" stands out, but it seems to have everything needed. It is good that the company advertises its contact information, including physical addresses.

From the rumours I heard from a few fellow bitcoiners closer to the project, the company seems to be aggressively pushing for its presale with just a forked open source repo to back it up.

So in conclusion, the project doesn't look like it can live up to its own hype. The approach is rather naive, even if it can be fully realised. I see no reason to back it financially, and for anyone that has - I would like to know why? The token can't be traded, sold, speculated on until the project launches, which makes it a rather risky proposition.

The Bitcoin Bullshit List

Your Crypto Idea Will Not Work

Your post advocates a new:
(x) Altcoin
(x) Wallet
(x) Distributed data storage

Your idea will not work.  Here is why it won't work.

(x) Your target audience is too small to support the project
(x) There is already a product on the market that does exactly what you’re doing, but ( ) faster / (x) cheaper / (x) better / (x) is more established / ( ) ______________
(x) Your project will not be compliant with the current (x) KYC / ( ) AML / ( ) gambling / (x) DMCA regulations
(x) Your solution is worse than general-purpose computing hardware / software
(x) Your presale tokens have no economic value

Specifically, your plan fails to account for:
(x) The existing regulations
(x) Public reluctance to accept weird new forms of money
(x) The known security exploits of the existing Internet services
(x) The human factor
(x) The problem of distinguishing between a human and a bot

and the following philosophical objections may also apply:
(x) Nobody likes DRM
(x) Ideas similar to yours are easy to come up with, yet none have ever been shown practical
(x) Feel-good measures do nothing to solve the problem
(x) I don’t trust YOU with the money

Furthermore, this is what I think about you:
(x) Sorry dude, but I don't think it would work.

Bitcoin Bullshit Tier

You are advertising a new Bitcoin / crypto related project. Based on the information provided, you have reached the Bullshit Tier of 3 for the following reasons:

Bitcoin Bullshit Tier 1 - marketing babble, technology misunderstanding
(x) “Blockchain”
(x) “As good as / better than Bitcoin”

Bitcoin Bullshit Tier 2 - willful misinformation, bait and switch
(x) Claiming your project can accomplish something hard without a clear explanation of how to do so

Bitcoin Bullshit Tier 3 - Many red flags
(x) Token IPO


Global Reserve Currency - Special Drawing Rights vs Bitcoin

Earlier this month, the G20 summit was held in China. One of the more interesting topics discussed, was the addition of Chinese yuan to the SDR - Special Drawing Rights. The topic of SDRs is rather important, but it doesn't seem to be discussed all that widely in the crypto community, so I figured I would cover it today.

Special Drawing Rights

Special Drawing Rights, or SDRs, are supplementary foreign exchange reserve assets defined and maintained by the International Monetary Fund (IMF). They were created in 1969. SDRs are allocated to countries by the IMF, and private parties do not hold or use them. The value of SDRs is based on a weighted basket of currencies (currently, 41% USD, 31% EUR, 11% CNY, 8% JPY and 8% GBP, worth about 1.39USD/SDR).

Special Drawing Rights are posed to replace the dollar as the world reserve currency. They serve well as a unit of account (due to lower volatility), can work well in international law (to have an objective measurement of value across multiple countries), and some countries even started pegging their currency to the SDR (due to increased transparency).

While the IMF and SDRs might not be an entirely ideal solution to creating a new, global currency (with US having a veto power and failing to ratify some reforms for example), it might be a step in the right direction.

Where SDRs fall short

While the Special Drawing Rights are an interesting idea, they fall short in a one key area - they appear to be inaccessible for anyone short of a government. This can limit how useful the currency can be for say, creating international settlement, or using it as a measurement of value for corporations or even individuals.

If SDRs were a publicly available and tradable currency, it would be really interesting to see it used for pricing items, wages, etc. to counter currency wars. If your wage is pegged at 3000USD/month, whether USD goes up or down, you're paid the same amount of dollars. But if your wage was instead set at 3000SDR/month, you would receive the same value each month, no matter if it meant you got 2500USD when the dollar is strong, or 3500USD when it was weak. This could give anyone a protection from the government's meddling.

Crypto SDRs

Creating a currency based on a basket of other currencies is also not an entirely new idea in the crypto space either. Paul Grignon (author of Money as Debt) has described his take on the idea as Digital Coin back in 2009. A part of the system, called Perpetual Coin, would initially be issued based on a value of a basket of currencies. Unfortunately, the project never left the conceptual phase, and the website is down now, so it is unlikely we will see it ever implemented...

Other than that, there doesn't appear to be an SDR-pegged cryptocurrency out there. This might perhaps be due to the fact that we already have a better alternative to the Special Drawing Rights - Bitcoin. What it lacks in stable value at times, it more than makes up in terms of being all-inclusive and, at least so far, immune from government influence.

It wouldn't be hard, however, to create an SDR-Coin - it could function like Tether, or perhaps more accurately, like BitUSD since you couldn't exactly withdraw the coin. The main problem for a centralised issuer would be keeping the valuation of the currency stable, especially in periods where the basket of currencies is adjusted. Other than that, once the currency itself is created (and I would almost bet we would see someone make the currency after the article is published - 700+ cryptos is not enough after all), it would be interesting to see it start being used internationally. Perhaps we would finally see what is the real demand for SDRs for corporations and real people, rather than just governments. With any luck, this might just hurry the demise of the USD or "petrodollar" hegemony.


Special Drawing Rights are an interesting take on creating a new global reserve currency. While it is currently only accessible to governments, it could be very useful for corporations and end-users. For the time being, Bitcoin is the most accessible alternative for the rest of us.


Smart guns and BlockSafe

DISCLAIMER: I work for Factom, which is mentioned in several examples in this article. While I work for Factom, the opinions expressed in this piece are, as always, my own.

Recently, I came across a token sale from the BlockSafe project. After a brief chat with the project's founder, I think this might be an interesting example of a blockchain solution looking for a problem and cashing in on some buzzwords. But let's start from the beginning...

Smart gun technology

A concept of a smart gun is nothing new - it's been around for at least 14 years. The premise is simple - it is a firearm that includes some technology only allowing for the gun to be used by an authorized user. It can be used to prevent "misuse, accidental shootings, gun thefts, use of the weapon against the owner, and self-harm". There are many approaches for user authentication - RFID chips, proximity tokens, fingerprints and biometrics, magnetic rings, mechanical locks, etc.

However, since most guns are inherently simple tools, and a lot of people would rather not have their defensive firearms "rely upon any technology more advanced than Newtonian physics" - batteries go dead, electronics malfunction, software bugs out, etc. Waiting for a blockchain transaction to confirm before your gun is unlocked is the last thing you want to be doing in a hurry.

Moreover, even if the technology was reliable, it would not be able to prevent every situation the society would want to avoid dealing with. Most gun deaths are suicides in the US, you wouldn't really be able to stop most mass shootings or other homicides without some major restrictions (like location-locking guns to one's home for example). Best it could do is restrict the use of stolen guns by people that wouldn't know how to crack or circumvent the DRM - a very small part of the issue.

The smarter the guns would become, the more concerns would be raised by people being paranoid the government would install a kill switch in their weapons to disable them remotely to "take away their freedom" and so on.

Lastly, it is very unlikely requiring any such technology would ever pass the NRA's lobbying in US's current political system. At very best it would be sold as an extra feature, but I somehow doubt there would be many end-user buyers for a gun with limited firing capabilities:

Blockchain for smart guns - good and bad ideas

There are many ways blockchains could be used in conjunction with smart guns, some more useful than the others. As the BlockSafe Foundation website (or their other, non-functional website, #gunsafety #liberty?) doesn't go into too much details on the specifics, let's explore a few options by ourselves.

Solution for the manufacturers - If the project is working up to manufacturer's spec, even if it was ultimately misinformed or using "the blockchain" as a buzzword, you can't really blame the developers for it. Even if using traditional solutions would've been better, they would be paid to deliver the solution in its current shape.

Data logging - If the gun would not be locked by the blockchain, but the solution was only used to log any discharges, or possibly even photos or other data, the blockchain might be used to ensure no data is lost or altered after the fact. This would be similar to how DHS uses Factom - to prove integrity of data. This approach would be especially useful for police and similar civil servants.

Ownership tracking - Instead of doing anything directly with the gun itself, the blockchain could be used to track the ownership of the guns themselves. This would work for both smart and traditional guns to establish an unalterable record of history if a firearm was to be used in a crime in the future. This would be a similar approach to Factom's land title record project. While this might be a good solution for the blockchain, it is very unlikely to pass through NRA as explained here.

Gun locks - possibly coupled with Ownership Tracking, the gun would essentially become a smart property. The gun would keep track of which private key owns it, and would only unlock itself if authorised by the proper private key - through RFID chip, smartphone app, etc. If the ownership would change, proper, new keys would be uploaded and so on. While it might sound like an interesting idea, allowing people to remotely disable their stolen property, etc., this approach would negatively effect the firearm's functionality as described in the previous section of the article.

All in all, it looks like most of the applications for blockchain-powered smart guns could basically be implemented in some straightforward smart contract on Ethereum or the like. Most of the complexity in the technology would come from everything that would be built on top of the blockchain. Now, with that in mind, let's look at how BlockSafe is selling itself...

Claims and buzzwords

Looking at BlockSafe's promotional video, we can list a number of claims, stated or implied, of what the project can do:
  • Prevent
    • Tragic amount of human suffering
    • Mass shootings
    • Unnecessary deadly force from police officers
    • Terrorist attacks
    • Gang violence
    • Citizens being killed by their own guns
  • Save lives
  • Secure one's firearms
  • Manage who can use their firearms
  • Locate and disable stolen weapons
  • Maintain a decentralised database

All powered by Trigger token. Other than the slew of buzzwords intended to appeal to emotions, it looks like the BlockSafe is designed to remotely control and track the guns. Looking at one of their infographics, the system also looks designed to be logging when the gun is used and notify emergency personel. This seems to be hitting on all of the major blockchain applications listed in the previous section, for better or worse.

Even if the project was to succeed, it is very unlikely it would accomplish all of its claims. A terrorist, a gang member, or a mass shooter would not choose a smart gun for their actions. You might get some chance of preventing people getting killed by someone taking their gun, but that's a slim percentage overall, about 0.02% of the gun owners would be killed by their own gun, which includes suicides. As for police officers using deadly force, it might have some dampening effect, but I somehow doubt it would make a significant impact if any.

So what would the Trigger token be likely used for? Well, if you would pay to place logs of the gun into the blockchain, then that's defeating the point - you want every log to go into the chain and not allow people to withdraw their funds to prevent logs from happening. You would need some sort of transactional currency for that, or a centralised solution maintained and paid for by the manufacturer (in which case, you don't need much of a blockchain). Using triggers to transfer gun ownership might be possible, but it might not occur often enough to maintain the network. Using the tokens to unlock the gun would be outright malicious.


All in all, the BlockSafe project looks like a solution looking for a problem and wanting to use a public blockchain to boot. The token presale looks like pure speculation - the project itself doesn't look like it needs the tokens, nor is there a clear explanation of what the tokens would be used for.

The smart gun technology as hinted by their video doesn't look useful. While that might not matter if the project already has industry partners committed to using the project, it might be an important thing to keep in mind for the token speculators - if nobody wants to use the technology, the tokens will ultimately be worthless. If the industry partners are paying for the technology, why sell the tokens at all?

All in all, most of the goals smart guns wish to accomplish could be accomplished easier with a physical lock on the gun, or putting the gun in a safe.

Ultimately, if you are focused on saving lives and reducing gun-related deaths, ban the guns like Australia did, don't run a token presale for some blockchain project...

The Bitcoin Bullshit List

Your Crypto Idea Will Not Work

Your post advocates a new:
(x) Altcoin
(x) Permissioned blockchain

Your idea will not work.  Here is why it won't work.

(x) Your target audience is too small to support the project
(x) The proposed security model is (x) flawed / ( ) not enough / ( ) completely wrong and therefore you will be ( ) scammed / ( ) hacked / ( ) stolen from / (x) circumvented quickly
(x) There is already a product on the market that does exactly what you’re doing, but (x) faster / (x) cheaper / (x) better / ( ) is more established / ( ) ______________
(x) You rely on proprietary (x) hardware / (x) software / ( ) intellectual property / ( ) _________
(x) The solution would work better as a (x) centralised / (x) decentralised / ( ) distributed solution
(x) Your solution is worse than general-purpose computing hardware / software
(x) Your solution will make the current hardware / software perform significantly worse
(x) Your presale tokens have no economic value

Specifically, your plan fails to account for:
(x) Public reluctance to accept weird new forms of money
(x) The human factor
(x) The problems computers have with interacting with the real world
(x) Strong lobby groups opposed to solutions like yours

and the following philosophical objections may also apply:
(x) Nobody likes DRM
(x) Ideas similar to yours are easy to come up with, yet none have ever been shown practical
(x) Whitelists suck
(x) Feel-good measures do nothing to solve the problem

Furthermore, this is what I think about you:
(x) Sorry dude, but I don't think it would work.

Bitcoin Bullshit Tier

You are advertising a new Bitcoin / crypto related project. Based on the information provided, you have reached the Bullshit Tier of 3 for the following reasons:

Bitcoin Bullshit Tier 1 - marketing babble, technology misunderstanding
(x) “Blockchain”

Bitcoin Bullshit Tier 2 - willful misinformation, bait and switch
(x) Claiming your project can accomplish something hard without a clear explanation of how to do so

Bitcoin Bullshit Tier 3 - Many red flags
(x) Token IPO
(x) Logical fallacy: ( ) false equivalence / ( ) false dichotomy / (x) appeal to emotion
(x) Providing no company contact information