Long Reads Sunday #80 - 1.26.20
Davos dystopias, BCH dev fund, BTC privacy upgrades and more
Thanks for all of the great feedback on the shift to email. Most people like the shift in general, but the one comment I got was that people worry that this format will lose some of the deeper cuts. I’m going to try a slightly different version this week. Let me know if you prefer this or last weeks “TOP 5 Model” better. Happy long reads - NLW
TL;DR - The LRS Top 5
Don’t have time for a full review of the week? Just check out these 5 threads/essays and you’ll get the big picture.
Honorable Mention: Bitcoin continues to march ever onward. This week, that looked like full BIPs for Schnorr/Taproot, which have significant implications for privacy and scalability. The only reason this is an honorable mention is that I anticipate we’ll be discussing it quite a bit in the weeks to come.
🤬5 - Think debates are important but *bad* arguments drive you nuts? You’ll love this guide on how not to critique Ethereum.
🦄4 - Speaking of Ethereum, if you read one thing to get an insiders take on the state of the protocol and community, read Josh Stark and Evan Van Ness’ 2019 year report.
🤝3 - What does it take to get BCH mentioned in Long Reads Sunday? Apparently the answer is large-scale miner collusion to implement a forced dev fund with 12.5% of the block rewards. Emin writes why the execution is so bad even if the idea might work for the protocol, while Vitalik contextualizes it in funding for public goods.
💵2 - Davos set the frame for all our discussions this week. The WEF released a toolkit for CBDCs; Crypto Dad was everywhere with his Digital Dollar advocacy; CoinDesk captured it all with their pop-up newsletter.
🤳1 - A major blow to privacy, as Reuters broke the story of Apple succumbing to pressure from the FBI to limit encryption on consumer’s iCloud backups.
The Week That Was
Topic by topic, here’s the story of last week.
The Davos Report
The World Economic Forum celebrated its 50th anniversary by talking talking about climate change and stakeholder capitalism. While some (reasonably, I might add) dismissed the event, I argued that it was worth our paying attention, given that crypto was quite literally on the agenda.
The big topic of conversation in our domain was Libra, China’s digital yuan, and central bank digital currencies. The WEF released a tool kit for CBDCs, Japan announced that it was looking into a digital currency to combat the influence of China, and former CFTC chair Christopher “Crypto Dad” Giancarlo was everywhere arguing the US needs to compete (and discussing his new Digital Dollar Project foundation) to help them do so. His position got support in an oped in Foreign Policy retweeted by a Wisconsin Congressman, as well.
Still, the tone of the event was still very “blockchain, not crypto.” Neeraj from CoinCenter captured it perfectly.
Then again, Alex Gladstein made the point that the real disruption wasn’t going to come from the Davos grip-and-grin but that good ol’ fashion Sat Stackin.
BCH miners push dev fund
In order to better fund protocol development, a group of the 4 largest BCH mining pools have banded together to insist that 12.5% of block rewards go to a dev funding pool, going so far as to say they will orphan blocks that don’t comply. The feedback?
Hasu: BCH ‘openly establishes a cartel’
Nic Carter jokes that his bitcoin mining parody ‘wasn’t meant to be an instruction manual’
Emin Gün Sirer hot take on why the dev fund could be a good idea, but the execution creates massive issues.
Vitalik thread contextualizing it in larger questions of funding for public goods
Privacy and its discontents
Something good and something bad on the privacy front this week. On the negative side, news broke that Apple kowtowed to pressure from the FBI to not enable full encryption on iCloud backups. This is especially painful as Apple had (seemingly) been the big tech company willing to fight the government around privacy issues.
Within the bitcoin sphere itself, however, privacy got a boost. The Schnorr/Taproot upgrades that would improve bitcoin privacy in numerous ways were officially published as a BIP - the next step on their journey to inclusion in the base protocol.
The latest in Ethereum and DeFi
There was actually a huge amount of content and conversation around Ethereum this week.
For starters, Josh Stark and Evan Van Ness released a massive 2019 retrospective.
PoolTogether, the lossless lottery platform, had a massive week, seeing one $200k entrant and overall more than doubling its pool.
For the flame warriors who just want to battle in the unholy arena of crypto Twitter, it may be worth reading this guide on how not to critique Ethereum
Set Protocols launched social trading
Rocket announced a new platform offering loans using NFTs as collateral
Gitcoin Grants closed out its 4th round with more than 1,300 unique contributors
Thats a wrap. CLR Round 4 is closed. FINAL STATS: Gitcoin Grants Round 4 has seen 6473 contributions from 1315 unique community members, worth $144810 in just over 14 days. 💰💰 Upcoming Dates: - 🚢 Match Payout Instructions by EOM - Round 5 is *tentatively* scheduled for MarchIn case it wasn’t already clear, 2020 is shaping up to be all about pushing the boundaries of what DeFi can do, in terms of everything from how its collateralized to what applications it enables.
The latest research
Crypto research teams were out in full force this week. Three notables:
Fidelity published a historical look at third party custody
The Block and Blockchain Association collaborated on a report about crypto industry employment. Highlight - more than 85% are in mining, exchanges, or development.
CoinDesk Research starts quarterly reports looking back at 2019.
Three things that aren’t crypto, but you should read anyway
Crypto doesn’t exist in a vacuum. These threads represent the best content in related areas.
Why investors are likely to stay focused on private equity vs. public markets
Trends in the venture markets (TL;DR without pedigree, it’s still hard to raise)
What happened to America’s economy in the 1970s?
This Week on The Breakdown podcast 🎶
Tuesday | Gitcoin's Kevin Owocki on Controversy and the Future of Open Source Funding
Wednesday | Why Vodafone’s Defection Won't Matter For Libra
Friday | Davos Takeaways, CBDCs & the Rise of Bitcoin Art featuring Brekkie von Bitcoin
Burn of the week
In an interview from Davos, Dalio had some less-than-kind things to say about bitcoin. Enter Meltem.
There it is, the second edition of LRS’s email-only version. If you made it this far, I’d love if you could take a look at last week’s and see whether you like this form or the more consolidated Top 5 version better. Thanks in advance!