Tag Archive for cryptocurrency

2022’s Most Popular Posts

2022's Most Popular Posts2022 is in the history books.

There’s a lot to leave behind in 2022. Some of the global low lights included; COVID-19 is still with us, Russia invaded Ukraine, and climate change is headed in the wrong direction.

Neil Degrasse Tyson2022 low lights in the United States included; mass shootings across the U.S., the highest inflation in four decades, food prices spiked, and gasoline prices in the U.S. reached $5 a gallon. The U.S. Supreme Court overturned Row v. Wade after nearly 50 years, Florida enacted homo-phobic “Don’t say gay” laws and the the rudeness pandemic.

Fortunately, 2022 was not all doom and gloom. Here are the 5 most popular posts from the Bach Seat in 2022.

 

How you can help Ukraine!

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedInFacebook, and Twitter. Email the Bach Seat here.

What You Need to Know About MailChimp Security

What You Need to Know About MailChimp SecurityJust in time for Data Privacy Day. Mailchimp, one of the largest email service-providers worldwide with 13 million active customers. suffered a security breach. On January 11, 2023 the Mailchimp security team reported that an unauthorized actor download the data of 133 customers of the Mailchimp service.

Mailchimp data leak

Data privacy day The Mailchimp security team identified an unauthorized actor had accessed tools used by Mailchimp customer-facing teams for customer support and account administration. The unauthorized actor conducted a social engineering attack on Mailchimp employees and contractors, and obtained access to Mailchimp accounts using employee credentials compromised in that attack.

Impacted organizations include WooCommerce, online gambling site FanDuel, Crypto darlings Yuga Labs and the Solana Foundation.

CSC405: Introduction to Computer SecurityMailchimp says they temporarily suspended account access for Mailchimp accounts where they detected suspicious activity to protect our users’ data. They have notified the primary contacts for all affected accounts on January 12. Mailchimp has been working with their customers to help them reinstate their accounts.

Recent data breaches

MailChimp has announced several data breaches in recent months. In August 2022, a cyberattack targeted its cryptocurrency-related customers. Mailchimp also revealed a security incident in March 2022.

data leakSpeculation is swirling online about the security of parent company Intuit other product lines (which includes TurboTax, Credit Karma and Quickbooks). TurboTax suffered its own security breach in 2021. Questions are also being raised about a possible central backdoor into Intuit, which the company denies.

If you have questions regarding a notice you received or the incident in general, please reach out you can email ciso@mailchimp.com. The company has not announced the appointment of a new CISO since Siobhan Smyth left the position in August 2022 shortly after the August 2022 was announced.

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multi-factor authenticationInformation exposed in data breaches like this is commonly used by attackers to target users with phishing attacks or attempt to reset passwords to gain account authorization. This is why multi-factor authentication (MFA) can help. Even if the bogus password resets were successful the MFA can prevent the attacker from going further.

How you can help Ukraine!

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedInFacebook, and Twitter. Email the Bach Seat here.

Ozzfest Flops in the Metaverse

Ozzy Flops in the MetaverseThe reviews are in for the recent Decentraland MetaverseMetaverse Music Festival 2022,” by Ozzy Osbourne. They are not good. The legendary IRL hard-rocking concert series Ozzfest looked like “a slideshow running on a PlayStation 2,” in the digital space according to one review

Ozzy Osbourne in the metaverseThe Metalverse show featured “performances” by metal legends Skid Row, Megadeth, Motorhead, and Ozzy Osbourne. The Prince of Darkness performance turned out to be digital facsimiles of Ozzy stiffly “performing” on stage. No backing band, just the legendary performer’s virtual avatar looking “stiff as hell” in one review.

Metaverse mosh pit

There was a sparse crowd of player avatars just kind of standing there and maybe shuffling their feet in a goofy, lifeless dance. One review called the concertgoers “a phantasmagorical array of avatars.” (rb- I don’t know what that means – but I’m sure its not good) Not exactly the sweaty, blood-pounding experience of the Ozzfest mosh pit of my youth.

Metaverse Music Festival 2022

As you can see in the video, the visuals were bad. They were described as having the “set design and visual appeal that would fit better in Guitar Hero.” There were hokey banners shouting things like “Welcome to the Metalverse” and “rock your fucking heads.”  The show backdrop featured an advert for NFTs. It sounds like the “corporate capitalist hellscape” that we have come to expect from social media not a show from the Black Sabbath frontman.

What is the metaverse

metaverseIn plain language, the metaverse is an interactive, 3D version of today’s internet. The pipe dream is for people to travel through virtual spaces.  We’ve (kind of ) seen this fad before. Second Life was the virtual world du jour in the early 2000s.

Launched in 2020, Decentraland is described as a virtual social world powered by the Ethereum blockchain. It claims to be the first decentralized metaverse. Within the Decentraland platform, users can create, experience, and monetize content and applications as well as socialize and attend events like Ozzfest. 

Not many visitors

The Decentraland Metaverse isn’t exactly teeming with people. Despite a metaverse valuation of over $6.5 billion dollars, users just don’t care. There are reports that Decentraland only had 38 “active users” over a period of 24 hours. This a very low number, especially considering the company has a market cap of a $1.2 billion. These numbers really amount too much, given the amount of money being poured into metaverse platforms like Decentraland. One expert said,

Anyone telling you that there’s a metaverse today that has worked is lying through their teeth

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A cow wearing VR gogglesI get it – the metaverse is a new crypto-enabled sales channel. It is being used to promote new music, drive NFT sales, or perform in the metaverse with new audiences.But I am highly skeptical of any of these projects by the techbros to upload everything into the new-agey singularity metaverse.

I sure hope this is not the future. Where some unknown person on the intertubes can exploit and make even more money off of dead musicians and bands that no longer exist. Can you imagine a Kiss farewell 2040 show made up of deep-fake technology viewable only with a virtual reality headset rig?

I don’t want to go to a pretend concert in a pretend location.

I would rather be on the hill at Pine Knob during a June evening hearing real sounds, real sights, real smells, and real emotions, from real musicians with real fans.

Pine Knob

 

How you can help Ukraine!

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedInFacebook, and Twitter. Email the Bach Seat here.

How to Buy a Non-Fungible Token

How to Buy a Non-Fungible TokenCNN reports that a new record price was paid for bottle of Champagne. The bubbly sold at auction for $2.5 million, making it the most expensive bottle of wine ever sold. The record setting magnum of Chateau Avenue Foch, 2017, comes with a bonus. For $2.6 million the owners also got a single non-fungible token (NFT). The NFT is for the rights to an image of “Bored Ape Mutant” and other cartoon figures that decorate the bottle.

What is a non-fungible token

What is a non-fungible tokenNon-fungible tokens (NFTs) are the latest cryptocurrency phenomenon to go mainstream. NFTs claim to transform digital works of art and other collectibles into one-of-a-kind, verifiable assets that can be traded on the blockchain. Sales of NFTs have been driven by celebrity endorsements, Online characeters like Elon Musk and Lindsay Lohan have pushed the NFT market to $41 billion in sales to 2021.

Non-fungible tokens are cryptographic assets on a blockchain with unique identification codes and metadata. These traits distinguish them from each other. Unlike cryptocurrencies, they cannot be traded or exchanged at equivalency. This differs from fungible tokens like cryptocurrencies, which are identical to each other and, can serve as a medium for commercial transactions.

How to Buy NFTs

How to Buy NFTsTo get into the highly speculative non-fungible token market, you will need to do some work before you can own an NFT.

  1. Set up a digital wallet that allows you to store NFTs and cryptocurrencies.
    2. Purchase some cryptocurrency. Eth, on the Ethereum network is the most popular cryptocurrency to buy NFTs. You can buy cryptocurrency using a credit card on platforms like Coinbase or PayPal.
    3. Move your cryptocurrency from the exchange to your wallet.
    3. Start shopping at non-fungible token marketplaces. NFT marketplaces are platforms that host thousands of non-fungible tokens creators and collectors.

NFT marketplaces

Foundation is a community-curated marketplace. It requires non-fungible token creators to be invited by other creators who are already part of the platform. 

Nifty Gateway is an non-fungible token marketplace with plans “to make NFTs accessible to everyone.” They work with big-name brands, athletes, and creators to create limited-edition digital art collections exclusive to the platform.

OpenSea.io is one of the first NFT marketplaces. It bills itself as  the “largest NFT marketplace.”

Rarible is a community-owned non-fungible token marketplace.  The platform focuses on art assets. It uses the RARI cryptocurrency issued on the platform.

The high profile NFT craze is attracting scammers. Some may try to sell you an non-fungible token when it’s not. Others may claim they have the right to sell an NFT they don’t own and didn’t create.

You have been warned.


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CNN reports that the Champagne was bought by Italian  cryptocurrency speculators. Despite their crypto profile, the purchase was made in dollars due to the recent cryptocurrency implosion. The price of a Bored Ape Yacht Club token has fallen. The price fell from an all-time high in April 2022 of 153 eth ($163,000), to 75 ethereum in May 2022.

Remember that the value of a non-fungible token is based entirely on what someone else is willing to pay for it. Therefore, demand will drive the price rather than fundamental, technical or economic indicators, which drive stock prices and investor demand.

Even if you buy a non-fungible token winner worth millions, Forbes warns that NFTs are subject to capital gains taxes. NFTs are taxable just like when you sell stocks at a profit. Since they’re considered collectibles, they may not receive the preferential long-term capital gains rates stocks do and may even be taxed at a higher collectibles tax rate. 

The cryptocurrencies used to purchase the NFT may also be taxed if they’ve increased in value since you bought them. This means you may want to check in with a tax professional when considering adding NFTs to your portfolio.

How you can help Ukraine!

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedInFacebook, and Twitter. Email the Bach Seat here.

Cryptocurrency Implosion

Cryptocurrency ImplosionThe cryptocurrency world was rocked last week. The cryptocurrency market lost $500 Billion (Yes with a B). The popular cryptocurrency Terra Luna lost 99% of its value, dragging down a so-called “stablecoin” with it. The “stablecoin” cryptocurrency TerraUSD, (UST) fell from a high of $118.00 (in April 2022), to $0.09 on Thursday (05/12/2022).

maintained by a complex mechanismTerraUSD is an algorithmic stablecoin developed by Terraform Labs out of Singapore. An algorithmic stablecoin means it does not have reserves (fiat currencies or other highly liquid assets). Instead, its value was supposed to be maintained by a complex mechanism. Its value comes from swapping TerraUSD coins with a free-floating cryptocurrency called Luna to control supply.

What is a stablecoin

The goal of a stablecoin is to offer investors a safe harbor to avoid the fluctuations in other cryptocurrencies like Bitcoin and Ether. They are supposed to hold a constant value, no matter market conditions. Recently, stablecoins have  been used in international trade and as a way to avoid capital controls, according to experts. The theory behind stablecoins is try to ensure they remain in parity (peg) with certain assets. The assets can be the U.S. dollar – with one token equaling $1, for example. However that did not work for TerraUSD (UST),

stablecoins try to remain in parity (peg) with assets like the U.S. dollarThe core theory to maintain its peg is as old as the dismal science. They create supply and demand. Whenever the price of UST falls below $1, traders are incentivized to “burn” their UST tokens—taking them out of circulation—in exchange for Luna. The lower supply of UST, in theory, increases the stablecoin’s price back to $1 and maintains the peg. UST was also partly collateralized by billions of dollars’ worth of bitcoin (not highly liquid).

The “algorithmic stablecoin” tanked the broader cryptocurrency market when it fell well below its theoretically fixed peg of 1 to 1 to the U.S. dollar. After losing its peg, UST traded as low as 13 cents on Friday. Luna, its sister cryptocurrency, became nearly worthless overnight after trading for $80 a week earlier. As investors saw the stablecoin dropping, they rushed to withdraw their money (an online bank run). Major crypto exchanges ultimately delisted both Luna and UST to protect consumers.

The collapse sent a tsunami thru the cryptocurrency marketsThe collapse sent a tsunami thru the cryptocurrency markets and spooked investors. Bank of America Research says it was the worst implosion since May 2021. It measures up to both the 2008 financial crisis and the dotcom crash in 2000. The entire cryptocurrency market now has a market capitalization of less than half of the $2.9 trillion it was worth in November 2021.

Bitcoin, which makes up around 44% of the crypto market, price dropped to a 90-day low of $26,350 per bitcoin. As UST fell BTC lost more than 56% from its November high of $68,990.90.

Coinbase logoCoinbase (COIN), the only major publicly traded cryptocurrency exchange, also fanned the fire. In midst of the cryptocurrency implosion, COIN warned customers that their cryptocurrency holdings could be at risk if Coinbase goes bankrupt. CEO Brian Armstrong said Coinbase issued the warning in order to comply with updated SEC guidance.

Ethereum (ETH), the second-largest cryptocurrency, dropped to a third from a November 2021 high of $4,812.09 to $1,748.30 during the UST meltdown.

Smaller cryptocurrencies were not immune to the cryptocurerncy implosion.

  • Monero (XMR) lost a third of its value during the implosion. It fell to a low of $119.30 from from a high of $457.15 set earlier in the week.
  • DogecoinDogecoin (DOGE) Elon Musk’s pet cryptocurrency fell from a high of $0.69 per coin to a low of $0.08 per coin. During the cryptocurrency meltdown It lost 88% of its value.
  • SHIBA INU (SHIB) fell to a low of $0.00001079/coin. It’s previous high set in May 2021 was $0.00008/coin.It lost nearly 93% of its record value.

So what happened?

crypto moves much more like a tech stockCryptocurrencies were once viewed as newest hedge against interest rates and inflation. However experience has proved they are far more correlated to overall markets than early adopters hoped. Crypto proponents tell us that cryptocurrencies are an uncorrelated assets. In other words, it should float freely, divorced from the rest of the market. But that is not true. Because crypto moves much more like a tech stock than it does an inflation hedge. When tech stocks tank, so do digital assets. Garrick Hileman research chief at Blockchain.com and visiting fellow at the London School of Economics said, “We see more overlap in ownership than we ever have, this kind of convergence between Wall Street and crypto.

Faulty cryptocurrency systems

The reason TerraUSD in particular went down so much is that the Terra blockchain network automatically shut down. Terraform Labs explained, the price of Luna tokens had dropped so low that it was unable to “prevent governance attacks.” That shutdown for a time prevented transactions in the algorithmic stablecoin. The company tweeted that the move was necessary to allow it “come up with a plan to reconstitute it.” Additionally, the company’s chat board posted a notice saying it had been “locked down so new people can’t come in and spread fear, uncertainty, doubt and misinformation.

Elon Musk flip flops on cryptocurrencies

Elon Musk flip flops on cryptocurrenciesThe cryptocurrency implosion follows a recent crash brought on by social media influencers. Elon Musk and Tesla made a U-turn on accepting Bitcoin as payment for its products.

Telsa bought $1.5b of Bitcoin shares, which sent the market price of both the crypto and TSLA soaring. The decision by Tesla to not accept cryptocurrency was seen by some as a ding on the credibility of cryptocurrency to compete against physical currencies. Another problem is Elon Musk’s support of Dogecoin. Dogecoin is so unstable it was off 88% from its high during the cryptocurrency implosion.

China outlaws cryptocurrency

China outlaws cryptocurrencyChina continues clamping down on non-Chinese cryptocurrencies. Recently the government blocked initial coin offerings, and warned against speculative trading. Additionally, China ordered Bitcoin mining in its Sichuan province to shut down completely and told banks to stop supporting crypto transactions, in a latest wave of restrictions on cryptos.

Additionally the country’s central bank, People’s Bank of China, has effectively banned digital coins after announcing all transactions of cryptocurrencies are illegal. This forced Chinese crypto miners to move to other jurisdictions that were more miner-friendly driving up coin costs.

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As we have seen a bad-timing and a number of missteps laid on top of a tumbling stock markets and war in the Ukraine caused many users to lose faith in UST and make an old fashioned bank-run on the cybercurrecny.

The Federal Reserve warned that stablecoins are vulnerable to investor runs because they are backed by assets that can lose value or become illiquid in times of market stress. A run on the stablecoin could therefore spill over into the traditional financial system by creating stress on these underlying assets, it said and we saw.

How you can help Ukraine!

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedInFacebook, and Twitter. Email the Bach Seat here.