Autor Cointelegraph By Andrew Singer

Crypto winter teaches tough lessons about custody and taking control

Crypto winter teaches tough lessons about custody and taking control

Uverejnil používateľ | sep 2, 2022 |

The crypto winter has pumped new life into the adage “Not your keys, not your coins,” particularly after the collapse of some high-profile enterprises like the Celsius Network, whose funds were frozen in June. Just last week, Ledger CEO Pascal Gauthier hammered home the point further, warning: “Don’t trust your coins and your private keys to anyone because you don’t know what they’re going to do with it.”The basic idea behind the adage, familiar to many crypto veterans, is that if you don’t personally hold your private keys (i.e., passwords) in an offline “cold wallet,” then you don’t really control your digital assets. But, Gauthier was also framing the issue in a larger context as the world moves from Web2 to Web3:“A lot of people are still in Web2 […] because they want to stay in the matrix where they’re being controlled, because it’s easier, it’s you know just click yes yes yes and then someone else is going to deal with your problems.” But, giving away control won’t set you free. “Taking responsibility is how you become free.” Admittedly, Gauthier has a self-interest here — Ledger is one of the world’s largest cold-wallet providers. Then, too, he may have been stating the obvious. In May, Coinbase acknowledged in an SEC 10-Q filing that if it ever went bankrupt, customers that entrusted their digital assets to the exchange “could be treated as our general unsecured creditors,” i.e., could find themselves standing at the back of the creditors’ line in bankruptcy proceedings. “It doesn’t matter that the exchange’s contract with you says you ‘own’ the currency,” Georgetown University law professor Adam Levitin told Barron’s at the time, “That’s not determinative of what will happen in bankruptcy.” But, Gauthier’s statement raises other questions, too. This notion of seizing “control” of one’s keys and coins could become more complicated given recent regulatory proposals in Europe, as well as a key government agency interpretation in the United States. Moreover, as the world transitions from Web2 to Web3, is it really so certain that centralized solutions like Coinbase and others might still not have an important role to play with regard to custody and, yes, even privacy?Learning the hard wayGenerally speaking, it appears that consumers still do not understand the potential risks when they turn their crypto private keys over to centralized platforms and exchanges.“It’s been made abundantly clear that even the most seemingly trustworthy custodians can still make grave missteps with user funds,” Nick Saponaro, CEO at the Divi Project, told Cointelegraph. “The promise of self-sovereign ownership of your money is immediately obliterated when users hand over their private keys to any third-party, regardless of that third-party’s genuine intent.”“All crypto users should learn and be responsible for the security of their own coins by storing them securely on hardware wallets,” Bobby Ong, co-founder and chief operating officer at CoinGecko, told Cointelegraph.“However, this is not a popular move because for most crypto users, it is probably more convenient to store them on centralized exchanges.”Recent: Blockchain firms fund university research hubs to advance growthStill, a centralized exchange (CEX) can be useful at times and maybe we should expect to live in a hybrid cryptoverse for a while, with both cold and hot wallets, centralized and decentralized exchanges (DEXs).“There is a case for using centralized exchanges for sending funds to others to not doxx your crypto addresses,” said Ong. “This is because when you send a transaction to someone else, they will know your address and can see your balance, historical transactions, and all future transactions.” Indeed, Ong tweeted recently: “The basic advice now is to have multiple wallets for various purposes and to fund these wallets using centralized exchanges. This works well but it’s not good enough. If you use FTX or Binance, Uncle Sam and Changpeng Zao will know all your wallets and they can profile you instead.”Continued Ong, “To get full privacy for your new wallet, a service like Tornado Cash is needed. Granted, it’s probably more expensive, slow and tedious,” but having such an option would ensure privacy and make crypto behave more like cash, he added.Justin d’Anethan, institutional sales director at Amber Group, agreed that trade-offs remain. “You can’t do as many sophisticated trades from a private wallet as you can on a centralized platform, or at least not as easily and efficiently,” he told Cointelegraph. Large, sophisticated traders will always need to have some of their holdings on exchanges to optimize returns. In his personal case:“I hold a chunk of my core holdings in private wallets, but I definitely hold some assets on centralized platforms for yield generation, some rebalancing, etc.”Corporate entities, especially, may not want to handle the operational side of a trade, including investment and custody, and they may also want to interact with a recognized and established centralized entity that can perform due diligence. Also, corporations may want to have an identifiable and liquid entity to sue “in the event of an error,” added d’Anethan.On the retail side, setting up a private wallet can still be daunting, which may explain why so many entrust private keys to CEXs and the like, even if it isn’t always the best way. As d’Anethan told Cointelegraph:“You might not know how — or have the motivation — to buy a private wallet, set it up to hold your private key and bear the risk of losing it. So, the path of least resistance wins.” Do regulators still not “get it?”Elsewhere, self-hosted wallet providers may soon face tough regulations in Europe if and when the EU’s Transfer of Funds Regulation (TFR) proposal takes hold. It could overturn this whole notion about taking control of one’s private keys and coins. “Effectively, it would amount to a ‘de facto’ ban on self-hosted wallets by enforcing to connect personal identities with self-hosted wallets,” wrote Philipp Sandner and Agata Ferreira.Mikolaj Barczentewicz, associate professor at the United Kingdom’s University of Surrey, told Cointelegraph: “The TFR proposal doesn’t ban self-custodied wallets, but it does incentivize service providers to treat them as ‘high risk’ for money laundering.[…] It may become practically very difficult to transact using self-hosted wallets.”Defenders of the TFR might respond that it’s not regulators’ fault that businesses are not better at risk-based analysis and at distinguishing situations of genuinely high risk of criminality, but “I don’t think that answer works,” continued Barczentewicz. “It shows a lack of understanding — or care — for the fact that regulations need to be designed to be workable in the real world. The EU is basically saying to businesses: ‘You figure it out.’”However, the biggest threat to self-custodied wallets in Barczentewicz’s view “is something like the scenario we’ve been watching in reaction to Tornado Cash being sanctioned by the U.S.: Businesses are afraid and engaging in over-compliance, doing more than the law requires.”As reported, on Aug. 8, the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued legal sanctions against digital currency mixer Tornado Cash for its role in laundering over $455 million worth of cryptocurrency stolen by the North Korean-linked hacking organization Lazarus Group.According to data analytics firm Chainalysis, the obligations of non-custodial crypto wallet providers are now unclear under OFAC’s recent designation: “An extreme interpretation could mean that non-custodial wallet providers might also need to block transfers to the sanctioned addresses, though this would be unprecedented.” At a minimum, government actions like these suggest that cold-wallet solutions to help crypto users take control of their private keys could become more problematic — not less — at least in the immediate future.An education imperative?Overall, does the crypto industry face an education challenge here i.e., to explain the importance of cold storage and individual “responsibility” to both individuals and policymakers? “I think we have to be honest with ourselves,” answered Saponaro. “Yes, education can help some individuals avoid the pitfalls we’ve witnessed in recent months, but most people will not read every article, watch every video or take the time to educate themselves.” Developers have a responsibility to develop products that guide users “into learning by doing.” “The crypto community, including in the EU, can still do much more to educate policymakers,” added Barczentewicz. “But this education cannot be limited to just explaining how crypto works. It is a mistake to think that once policymakers ‘get it,’ they will come up with sensible rules on their own.” The crypto community needs to be proactive in proposing detailed technical and regulatory notions of how to fight crime and malfeasance without giving up key benefits of crypto, like self-custody, he said. “It is not enough just to mention buzzwords like ‘zero knowledge proofs’ and then expect the policymakers to do the hard work.”Is taking “control” really important?What about Gauthier’s larger point that people simply have to learn to take “responsibility” for their assets — digital and otherwise — because “taking responsibility is how you become free?”“Crypto is a game-changer because we now have full control of our money without the need to trust any third-party,” said Ong. That said, some people “may choose to pass on the responsibility and trust a third-party custodian who may be better equipped to store their coins safely — and that is acceptable too,” he told Cointelegraph. Recent: Crypto volatility may soon recede despite high correlation with TradFi“In the crypto space, you typically have very binary opinions about how things can grow from here. I think the truth is somewhat in the middle,” said d’Anethan, adding:“One is delusional if one thinks every individual and corporate is going full DeFi tomorrow. But, one would also be delusional if one thinks the growing digital world will forever stay within the Web2 infrastructure.”What may be best is to have both centralized and decentralized platforms, “so that the user base can gradually shift where it sees the most value — however long that takes,” he said.

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Built to fall? As the CBDC sun rises, stablecoins may catch a shadow

Built to fall? As the CBDC sun rises, stablecoins may catch a shadow

Uverejnil používateľ | aug 12, 2022 |

There’s a ferment brewing with regard to central bank digital currencies (CBDCs), and most people really don’t know what to expect. Varied effects seem to be bubbling up in different parts of the world. Consider: China’s e-CNY has already been used by 200 million-plus of its citizens and a full rollout could happen as early as February — but will a digital yuan gain traction internationally? Europe’s central bank has been exploring a digital euro for several years, and the European Union could introduce a digital euro bill in 2023. But, will it come with limitations, such as a ceiling on digital euros that can be held by a single party? A United States digital dollar could be the most awaited government digital currency given that the USD is the world’s reserve currency, but when will it appear, if ever? Implementation could be at least five years away.Amid all this uncertainty, one question has persisted, at least in the cryptoverse: What impact will large-economy digital currencies have on stablecoins? Would it leave them any oxygen to breathe?On the positive side, some believe that most large-scale CBDCs will go the wholesale route, i.e., allowing direct access to digital money by a limited number of large financial institutions. If so, could this leave a “retail piece” for stablecoins in the payments sector?“Their wallets or accounts might be held by intermediaries like commercial banks, who then have claims on the central bank. But effectively, most CBDCs will be used for retail payments,” Gerard DiPippo, senior fellow at the Center for Strategic & International Studies, told Cointelegraph: “This includes China’s e-CNY, which many believe will be the first large-economy CBDC to be rolled out at scale.” “While it’s still early to make a call, I would expect that CBDCs will be accessible by both retail and wholesale parties,” Arvin Abraham, a United Kingdom-based partner at law firm McDermott Will and Emery, told Cointelegraph, adding that:“Governments have a competitive imperative to allow for retail use of CBDCs to keep their currencies relevant in a world with stablecoins and other cryptocurrencies that are increasingly being accepted as means of payment.”A competition for users?Assuming, then, a retail contest arises between stablecoins and CBDCs, which is likely to prevail? “The obvious advantage of stablecoins is that they exist or are at least further along than most CBDCs. This is especially true in the U.S. context,” said DiPippo. “I think a U.S. CBDC would take many years to deploy even if authorized by Congress today.” On the other hand, others believe that CBDCs, if and when they appear, will make stablecoins redundant. Consider that the two leading stablecoins, Tether (USDT) and USD Coin (USDC), are both linked to the U.S dollar and both aim for a 1-1 peg. “In a world with a U.S. dollar CDBC, the need for these coins goes away, as there will be a crypto native alternative that is always backed 1-1 by the dollar and is effectively interchangeable with its fiat equivalent,” said Abraham.But, maybe the outcome isn’t binary; a choice of one or the other. Perhaps they can peacefully coexist, a possibility that has been put forth by no less of an authority as the U.S. central bank’s second-highest-ranking official.“If private monies — in the form of either stablecoins or cryptocurrencies — were to become widespread, we could see fragmentation of the U.S. payment system into so-called walled gardens,” Fed Vice Chair Lael Brainard testified in a May Congressional hearing, adding that: “CBDC could coexist with and be complementary to stablecoins and commercial bank money by providing a safe central bank liability in the digital financial ecosystem.”Can stablecoins and CBDCs exist side by side?Is this harmonious scenario realistic? “I see no reason why stablecoins and CBDCs cannot coexist,” DiPippo told Cointelegraph. “In practice, their degree of coexistence will depend in part on regulations, specifically whether some governments even allow stablecoins for payments — especially in the cross-border context.”Much will depend on the user experiences, cost advantages, and general usability of each instrument, DiPippo added. “In general, I have more confidence in the private sector to succeed in these respects. I’m not so much worried about stablecoins being ‘crowded out’ as I am worried about them being banned.” Coinbase cryptocurrency exchange not only believes in cohabitation but says CBDCs may even boost stablecoins, according to a July white paper. “We strongly believe CBDCs will complement and encourage robust, inclusive, and safe innovation for stablecoins and the broader digital asset economy.”Stablecoins are in a better position to innovate than CBDCs, Coinbase added. “In addition to having a first-mover advantage, stablecoins are expected to continue to rapidly evolve and innovate over the coming years, experimenting in ways CBDCs may not be able to due to differences in size and scope.”Related: Metaverse visionary Neal Stephenson is building a blockchain to uplift creatorsCBDCs, too, may come freighted with certain constraints from which stablecoins could be exempt. In its quest for a digital euro, the European Central Bank is “exploring a 3,000 euro limitation on the amount of digital euro that can be held by one party, based on various policy considerations,” the white paper noted. If that were to happen, stablecoins would arguably be able to serve those “needing a larger holdings of a digital fiat currency equivalent.” Stablecoins might also offer higher interest rates than CBDCs, the paper suggested. “There could still be a role for stablecoins alongside CBDCs, although it would be more limited than today,” acknowledged Abraham. Stablecoins could have utility in providing a convenient means to have an interest in a basket of stocks, commodities and others. That is, “their function would be more akin to tracker funds where value is pegged to several assets.”Then, too, a U.S. CBDC may not be ready for a full rollout for another five years, wrote Thomas Cowan, part of the team at the Boston Fed that, in February, released a technical research paper on potential CBDC designs in a recent blog: “By the time a U.S. CBDC is issued, regulated stablecoins could provide solutions that a CBDC may have been designed for–such as boosting financial inclusion, cutting transaction costs and settlement time, increasing access to USD, and even expanding the dollar’s role as the global reserve currency.”MiCA darkens stablecoin prospects in EuropeIn Europe, though, the outlook for stablecoins – or “so-called ‘stablecoins’” as some EU officials call them – could be more problematic. The Markets in Crypto-Assets (MiCA) regulation, expected to take effect in 2024, presents “a number of challenges for stablecoins,” said Abraham, most notably a ban on the paying of interest by stablecoin issuers. A digital euro would complement cash, not replace it: together they would offer people a greater choice and easier access to ways of paying. This should help financial inclusion and promote innovation in the field of retail payments https://t.co/RiwOCers68 2/3— European Central Bank (@ecb) October 2, 2020Such a prohibition would “deprive European citizens of an attractive investment option, particularly considering that financial stimuli instruments adopted to limit the economic impact of lockdowns are expected to result in historically high inflation rates,” noted Firat Cenzig, a senior lecturer in law at the University of Liverpool. Meanwhile, Nicolaes Tollenaar, partner at the Dutch law firm Resor, suggested in a Financial Times opinion piece in early August that such a ban “would force issuers to adopt a business model that is only sustainable with near-zero interest rates,” which are unlikely in the near future.Wherefore China?Elsewhere, China’s e-CNY has already been used by an estimated 250 million, and it remains a key part of any global CBDC discussion. What would a digital yuan mean for not only stablecoins but also the U.S. dollar? In March, a Hoover Institution study noted that “over time, the spread of the e-CNY might diminish the role of the dollar as the world’s reserve currency and undermine the ability of the United States to deploy financial sanctions against rogue international actors.”DiPippo, for one, doesn’t see much threat from an e-CNY on the international stage, however. “The e-CNY is unlikely to resolve the broader problems with renminbi internationalization, including China’s capital controls and geopolitical concerns.” The primary use of the e-CNY is for domestic retail transactions, though “experiments are underway to make the e-CNY usable across borders and interoperable with some regional CBDCs,” he added. It is unlikely to do much to dent the USD’s standing as a reserve currency per se, primarily because it is designed as a digital cash substitute that does not pay interest. “Central banks would not move a substantial share of their international reserves into a cash substitute with no yield; they’ll continue to hold bonds. The e-CNY will not change that,” DiPippo told Cointelegraph.What about financial inclusion?All in all, there are good reasons why CBDCs and stablecoins might be seen to be locked in a zero-sum game. They have the same design purpose, i.e., moving money more effectively, and a large-economy CBDC is not likely to be blockchain-based either because that would make it too slow, according to Cowan. Elsewhere, Eswar Prasad, professor of economics at Cornell University and author of the book, The Future of Money, told Cointelegraph earlier this year: “A widely and easily accessible digital dollar would undercut the case for privately issued stablecoins,” though stablecoins issued by major corporations “could still have traction, particularly within those corporations’ own commercial or financial ecosystems.” Related: Decentralized finance faces multiple barriers to mainstream adoptionIn the end, consumers may determine which instrument carries the day. In terms of market adoption, “the user experience will be key,” added DiPippo. “So in that regard, I do not see stablecoins having an inherent advantage over CBDCs.”There is the matter, too, of financial inclusion, a goal to which both CBDC designers and stablecoin issuers pay lip service. “Everyday people like you and me are unlikely to go to the Fed to get our CBDCs to transact with on a daily basis,” wrote Cowan. That is, customers will still get their digital dollars from commercial banks, just as they get cash today from local banks. That might not help those who don’t have bank accounts. According to Cowan:“Regulated stablecoins could be better positioned to improve financial inclusion. This is because stablecoins are on numerous public chains and can be stored and moved easily without the need for a central party–just like cash today.”Cowan sees room for both financial instruments: “However value is stored and exchanged in the future, both stablecoins and CBDCs are likely to have a leading role in the upcoming transformation of finance.”

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Beyond the headlines: The real adoption of Bitcoin salaries

Beyond the headlines: The real adoption of Bitcoin salaries

Uverejnil používateľ | aug 3, 2022 |

Are cryptocurrency wages an idea whose time has come? Maybe not. It’s one thing, after all, to dabble in Bitcoin (BTC) with one’s excess cash and quite another to take a significant portion of one’s salary in BTC. Moreover, there are often tax and custody questions about crypto, as well as concerns about price volatility. There’s the matter, too, that few actual items and services can be purchased at present with cryptocurrencies. It’s not surprising, then, that aside from some celebrity athletes like Tom Brady and Aaron Rodgers and some high-profile big-city United States mayors, relatively few people outside the cryptoverse appear to have embraced this next step in crypto adoption. It’s in that context that one has to evaluate NYDIG’s recent announcement of a “partnership” with the New York Yankees baseball team that will allow players and other employees “to convert a portion of their paycheck to bitcoin via the NYDIG platform.” Is this the start of something new, given that it comes on the heels of a harsh crypto winter? Or is it just another public relations stunt, jumping on the bandwagon already established by professional U.S. football and basketball players? Interestingly enough, NYDIG offered some hints that Bitcoin salaries could actually become a secular trend above and beyond recent headline cases, especially among younger workers. According to its press release:“NYDIG research shows that 36% of employees under 30 said they would be interested in allocating a portion of their pay to bitcoin. Nearly 1 in 3 of those employees said that when choosing between two identical jobs at different employers, they would choose an employer that helped them get paid in Bitcoin.”NYDIG isn’t alone in identifying Millennials and especially Gen Zers as prime candidates to take crypto salaries to the next level. Indeed, one global hiring firm’s recent analysis of 100,000-plus employee contracts suggested that crypto wages appear to be on the rise, particularly among “borderless” remote workers, and especially residents of certain high-inflation regions or those with shaky banking systems, such as Latin America. Others have suggested, too, that employee demand for a portion of one’s regular wage in cryptocurrencies or stablecoins may be impervious to market fluctuations in the price of Bitcoin and other cryptocurrencies, though that sometimes seems hard to believe.Younger generations are still keenTo this last point: In November, a deVere Group survey reported that a third of millennials and half of Generation Zers would be happy to receive 50% of their salary in Bitcoin and/or other cryptocurrencies. This survey was conducted when crypto market prices were soaring, however. Does the financial advisory group believe that younger generations are still eager to receive their salaries in cryptocurrencies following a 50%-plus drawdown in crypto prices since that time?“Younger generations are still keen to receive their salaries in cryptocurrencies as they have grown up on technology. They are ‘digital natives,’” Nigel Green, CEO of the deVere Group, told Cointelegraph, and more comfortable using cryptocurrencies than older generations. Moreover, “they know the future lies in tech and appreciate the inherent value of borderless, digital, global, censorship-resistant and non confiscatable currencies.”“From our company, 90%+ [of employees] still stack Bitcoin regularly on a monthly basis,” Danny Scott, CEO and co-founder at the United Kingdom’s CoinCorner LTD, which has held Bitcoin on its balance sheet for some years and offers employees a BTC salary option, told Cointelegraph. “If anything, we have received more enquiries over the last few months from companies looking to pay their staff in Bitcoin.”In June, an Ascent survey reported that “44% of Americans would consider receiving part of their salary in cryptocurrency, and 36% said they would consider receiving all of their salary in cryptocurrency.” Still, that survey of 2,000 American adults was conducted on May 6, 2021 and May 25, 2022, when BTC was still close to $30,000. The price stood at ~$23,000 on Aug. 1 in comparison.Recent: How blockchain technology can revolutionize international tradeAdam Poulton, CEO at Get Paid In Bitcoin — a Bitcoin payroll solutions platform based in Australia — challenged the notion that the #PaidinBitcoin phenomenon was wholly resistant to market price influences. “Our business, while designed to take away the speculative nature of Bitcoin, still does suffer from the emotional rollercoaster of price rises and crashes,” he told Cointelegraph, further explaining:“Our service does see an influx of new customers during bull markets and a drop away in transactions during bear markets. It’s an issue that we are still actively trying to address as over the longer term.”People that stop and start the process of accumulating Bitcoin are actually worse off by trying to time the market, Poulton added, “rather than just doing the raw dollar-cost averaging strategy that our platform enables.” Trending higher in 2022Deel, a global payroll platform, regularly examines 100,000-plus cross-border hiring contracts in 150 countries to uncover trends. The firm reports that more and more employees are taking crypto as part of their salary. In the six-month period from January 1 to June 30, ~5% of all payments from the Deel platform monthly were taken in crypto, up from only ~2% in the previous six-month period. Dan Westgarth, chief operating officer at Deel, told Cointelegraph that he expects this growth to continue, with 8% in the 2nd half of 2022 a real possibility. Moreover, this trend is mostly “market agnostic,” i.e., not correlated with the market price of crypto. There is considerable variation by geographic region, however. Sixty-seven percent of Deel’s crypto salary withdrawals in the first half of 2022 were from Latin American (LATAM) countries, and another 24% from Europe, the Middle East and Africa (EMEA). By comparison, North America accounted for only 7% of crypto salary withdrawals and the Asia Pacific region just 2%.How to explain these differences? Three different groups are driving this trend, in Westgarth’s view. First are investment types, looking for a good longer-term investment. The second group is remote workers who reside in countries with aging banking systems. And, the third group is remote workers in high inflation countries, like Turkey or Argentina.Many of the banking systems in the LATAM region are old, and the cost of payment transfers to these countries is time-consuming and costly, explained Westgarth. Crypto transfers, in comparison, are fast and cheap, so workers take part of all of their salary in crypto and often convert it right away into local currency. Employees in places like Argentina might fall into all three groups, such as investors living in high inflation areas with old banking systems.When employees opt to take all or part of their salary in crypto, it isn’t always in Bitcoin either, according to Deel. Less than half (47%) in the most recent Deel survey received some payment in BTC, though this was still the leading option, followed by USD Coin (USDC) (29%), Ether (ETH) (14%), Solana (SOL) (8%) and Dash (DASH) (2%).Asked about the surprisingly high USDC component, which was more popular than Ether, Westgarth suggested that the stablecoin might be the first choice in some high inflation countries where trust in government is low and exchange rates aren’t always transparent. Those workers don’t want to take the investment risk of BTC or ETH, however, so a stablecoin like USDC represents a sort of middle ground, he suggested. In any event, “We let the workers choose how they want to get paid — local currency, crypto or USDC.”Green sees sustained growth in crypto wages over the next five years as Bitcoin becomes more widely distributed generally. As this happens, “liquidity will continue to soar, and volatility will continue to ease.” It is all part of continuing a decade-long trend, and Green expects that “most major corporations will offer workers a crypto payment option within five years.” Taking custody of one’s own BTCThere are many other questions about crypto as salary, including custody. To this last point, if people are going to take crypto for wages, then they need a place to store it safely. NYDIG, for its part, isn’t actually paying New York Yankee baseball players in Bitcoin but in a BTC-denominated portfolio asset. Not all agree that is the best way to go. “Our platform is directed toward people taking custody of their own Bitcoin,” Poulton told Cointelegraph. “From our point of view, the actual asset and delivery of Bitcoin is extremely important as it cuts out the counter-party risk of having to rely on other parties for the safe delivery of your value into the future.” Others ask why employees would want to take a salary in Bitcoin when there is almost nothing that you can buy with it. “I understand that ‘bricks and mortar’ adoption of Bitcoin acceptance is still very low,” answered Poulton, though Bitcoin-enabled credit cards have been proliferating. Nonetheless:“By simply receiving a bit of your wages in Bitcoin and holding it in a secure wallet, one is saving for the future and preparing one’s family for a potential future inflationary environment.”Another interesting aspect of the “crypto as salary” movement is gender participation. The proportion of female Bitcoin wage recipients has been growing, according to Poulton. “Our female representation was in the order of 7–8%,” but with the firm’s new business-to-business platform, “it’s now more like 38-40%.”Macrotrends favor growthOther employment trends favor crypto salaries too. In many industries, there is a “high demand for talent and a shortage of available candidates,” according to Deel’s hiring report, so “more companies are looking outside of higher-cost countries to find quality talent.” Demand for product and design roles, for example, is shifting from the U.S. to countries such as Argentina and India.Recent: What Kazakhstan’s new tax regime means for the crypto mining industryDeel’s most recent survey saw a dramatic uptick in worker contracts in places like Georgia, Armenia and Belarus in the EMEA region, Kyrgyzstan, Azerbaijan and Thailand in Asia-Pacific (APAC), and Trinidad and Tobago in LATAM, noted Westgarth. It is often much easier, cheaper and faster to pay remote workers in relatively “exotic” locations in cryptocurrencies than through traditional bank channels like the SWIFT system. Overall, mass cryptocurrency adoption — along with crypto salaries — is probably inevitable over time, according to Green. “But there are still obstacles to be overcome, including a lack of understanding among older senior executives, scalability and regulatory concerns.”

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Metaverse visionary Neal Stephenson is building a blockchain to uplift creators

Metaverse visionary Neal Stephenson is building a blockchain to uplift creators

Uverejnil používateľ | júl 27, 2022 |

Last month marked the 30th anniversary of the publication of Neal Stephenson’s science fiction novel Snow Crash. With its dystopian vision, rollicking prose and futuristic renderings of everything from social media networks to virtual assistants and even alternative currencies — Bitcoin wasn’t to launch for another 17 years — the work soon achieved iconic stature in the tech world. Bill Gates, Jeff Bezos and Jack Dorsey were admirers, while Google co-founder Sergey Brin called Snow Crash one of the two books that changed his life. In the mainstream world, Time magazine’s critics declared it one of the “100 best English-language novels published since 1923.” The novel also includes the first known presentation of the “Metaverse” with all its immersive and internet-gaming addictiveness. As Stephenson wrote about his protagonist, Hiro, who lives in a 20-by-30 storage unit:“Hiro’s not actually here at all. He’s in a computer-generated universe that his computer is drawing onto his goggles and pumping into his earphones. In the lingo, this imaginary place is known as the Metaverse. Hiro spends a lot of time in the Metaverse. It beats the shit out of the U-Stor-It.”Recently, Stephenson brought his creative talents to the blockchain world, teaming up with venture capitalist and Bitcoin Foundation co-founder Peter Vessenes in a project to build a new “metaverse first,” layer-1 blockchain network. Last week Stephenson and Vessenes sat down with Cointelegraph to talk (remotely) about their project, Lamina1 — lamina means “layer” in Latin — as well as the Metaverse and blockchain worlds generally.Cointelegraph: Peter, you’ve said that you envision Lamina1 as a sort of “base layer for the Open Metaverse: a place to build something a bit closer to Neal’s vision — one that privileges creators.” You also talk about employing “creator economics” in building your new blockchain network. What do you mean by that?Peter Vessenes: We are building it into the mining mechanics, where the nodes are actually going to reward people who are building content. We’re calling it proof of integration. If you make digital objects and they’re used by Lamina1 participants in a game, the system will directly mint you tokens.Overall, we’re looking to do things with Lamina1 that go beyond just making smart contracts and publishing them on a layer-2 chain somewhere. The Metaverse has its own requirements and needs, like persistent digital object storage for full 3D models. So we need something beyond storing a JPG on the IPFS [InterPlanetary File System]. CT: Neal, in chapter two of Snow Crash, your protagonist has driven his pizza delivery truck into the bottom of an empty swimming pool. A skateboarder generously offers to deliver his pizza for him, to which he agrees while handing her a card:“On the back is gibberish explaining how he may be reached: a telephone number. A universal voice phone locator code. A P.O. box. His address on half a dozen electronic communications nets. And an address in the Metaverse. ‘Stupid name,’ she says, shoving the card into one of a hundred little pockets on her coverall.”As best you know, is this the first-ever reference to the “Metaverse?”Neal Stephenson: Let me answer that by telling a related story. “Avatar,” in its current sense, is a word that I came up with independently in the course of writing that book, and for a couple of years, I assumed that I was the first person who had ever used it like that. But, then I found out there were some guys working on a project called Habitat who had actually coined the exact same usage of it a couple of years before I did. Those guys, to their credit, completely understood that it was an independent coinage. I’m still friends with those guys. In the case of the “Metaverse,” that has never happened. No one has ever come to me and said, “Hey, Neal, I was using the Metaverse in 1987, or something like that.” Never say never, of course, but there are actually people who look this sort of stuff up. I got a contact from the Oxford English Dictionary a few years ago. It was for “Anglosphere,” a term I used in the Diamond Age where I talk about the English-speaking cultures and countries of the world. This official contact said, “As far as we can tell, you are the first to use that term? Do you know of any prior usages?” I said I didn’t.CT: A lot of prominent tech-world figures were influenced by Snow Crash and your other novels. What writers influenced you?I started out reading a lot of fantasy and science fiction, but then I finally got talked into reading “real” literature by a series of excellent English teachers, books like Moby Dick, which incidentally is an absolutely insane book — with all the nerdy details of a hard science fiction, and also a speculative element to it.Recent: Texas a Bitcoin ‘hot spot’ even as heat waves affect crypto minersThen there was a period in the 1970s and 1980s when people were writing this extraordinarily vivid prose that really appealed to me — Tom Wolfe and Hunter S. Thompson, for instance. The Big Bang moment for me, though, was the publication of Neuromancer in 1984. Neuromancer is a science fiction novel, but from the very first sentence, it’s also great literary writing. And, it isn’t a kind of highfalutin writing, but like the stuff I was talking about a minute ago, the New Journalism movement, you know, vivid imagery. So, that was kind of the moment when I said, “Oh, I didn’t realize you were allowed to do that.”CT: Peter, you’ve said that you have “a raft of plans to implement Lamina1 quickly as we get the necessary governance, technology, node operators, IP partners, artists, business partners, and funds up and running.” Where do things stand now?PV: We have a bunch of recruiting going on now, we’ve hired a couple of new executives, we’re in the seed fund-raising round now and hope to be done in summer or early fall. On the immersive compute side, we’re just starting to get serious about building out our first couple of dogfoods [tests of a new product]. So, things are moving, and I think we should have something that people can poke at and play with in mid-September. CT: You were almost present at crypto’s creation — working closely with many of Satoshi’s immediate successors like Gavin Andresen as you built the Bitcoin Foundation, founded in 2012. For those few spearheading Bitcoin (BTC) back then, making money was arguably one of the farthest things from their minds, you have said. Recently, Ethereum co-founder Vitalik Buterin wrote a blog in which he lamented “the blockchain industry’s slow replacement of philosophical and idealistic values with short-term profit-seeking values.” Does Vitalik have a point?PV: There was this profound energy at the start of Bitcoin. People were like: “This is the future. We’re building it” — and it’s so appealing when you see it. For someone like me, yeah, I may be a little more skeptical, I’m not naturally someone who buys in instantly, but I was just swept up in it myself. Vitalik is very unusual. He’s this billionaire guy who lives out of a 30-liter backpack, who is motivated by other things than adding another zero to his net worth. I’ve thought about the senior leaders of these chains over the past 10 or 12 years, and one of the things that I think is important for blockchains if they are going to be successful — they should not be in it as a money grab. Neal and I have spent almost no time asking: Is this going to be really profitable? Rather the questions are: How is this going to impact the creators that we want to support and build the space that we want to build?CT: As any industry grows and becomes more mainstream, maybe it is inevitable that you’re going to need people to manage things — accountants, lawyers, financial officers — who also are looking closely at the bottom line?PV: It kind of is. You won’t get those kinds of people — that older generation of believers — coming into Ethereum now. The money has been made. The first time I saw Ether (ETH), it was $7.00. Now it’s $1,500. We won’t ever see $300,000 ETH, I believe. You need to create some green space for this next generation of believers to build their own thing. We probably do have a kind of natural arc on this. Of course, institutions are going to get more easily into something larger and more stable. So yeah, there’s probably some inevitability here. CT: In Snow Crash, Neal, you anticipate many of the elements of the Metaverse that are present today. But some developments of the past 30 years were unanticipated. You’re surprised that metaverse game players are still using “steampunk WASDE keyboards,” for example. What about some recent developments on the non-technical side, like $300 million of virtual land sold in three hours in the Otherside “world” in May? Did that surprise you?NS: If you read the book, it is clearly based on the notion of a market for virtual real estate, and there’s a kind of scarcity that’s been created from the fact that some parts of the Metaverse are more desirable for developing a site than others. So, it’s implicit in the book as written that there’s a virtual real estate market and that people pay money to control it, and some parcels are more desirable, more valuable than others. So, on that level, it’s all there in black and white. Whether that particular event you describe is surprising, I would say yes. The book was written a long time ago.CT: I’m sure you’re asked for predictions all the time about the way the Metaverse and technology in general is evolving, Neal. But are there any possible scenarios that really scare you?NS: I worry about things that are not directly related to blockchain and the Metaverse. I worry primarily about climate change and about social fragmentation from the fact that people don’t agree on a shared reality anymore. What we’re doing may in some way help to address those things — we intend to make the chain carbon negative, for example. But I don’t spend a lot of time worrying about nightmare scenarios, specifically about the Metaverse, because I don’t find that’s a productive way to start a project. The successful projects emerge from a more positive frame of mind, like, “Hey, this is going to change the world.” CT: Peter, during that $300 million sale of virtual land, gas fees on the Ethereum platform skyrocketed. A few parties paid thousands of dollars in transaction fees. Is that another reason to build a new layer-1 blockchain, in your view, to bring down transaction fees?PV: First of all, I think it’s important to say if you didn’t charge any fees, these chains would be overrun by spam. You have node operators, you have miners, and if you just gave it away for free, you’d have people who say: “Cool, give me 100% of that.” Bitcoin miners didn’t require fees in the beginning because there just wasn’t a ton of transaction volume, and Satoshi didn’t have a solution to this generalized problem, such as “how do you charge for this?”What Vitalik [Buterin, co-founder of Ethereum] did with Ethereum was really quite brilliant — this concept of gas and lithium. [He recognized] that any chain is going to have to charge for usage of the resources, or you just have the Tragedy of the Commons. That said, there are some eye-opening numbers like $12 billion of buy-side demand [i.e., gas fees] for ETH in 2021. That’s good for Ethereum. It means people are using the network. That’s good for ETH holders, but it’s hard for those, like my 15-year-old son when all of a sudden it costs him something like $200 to do anything on the network. The plan for Lamina1 is to allow side-chains — similar to what Avalanche calls subnets or Polkadot calls substrates. We’re going to make it very easy for a developer or group that wants to have free transactions or very fast transactions. We’ll provide them a track to do that. They’ll have to go run those nodes and deal with the cost of that themselves, but if they think it’s best for their constituents to have no fees, they’ll be able to do that. CT: Neal, you’ve given credit to gamers for pioneering the Metaverse. Role-playing video games have brought down the cost of 3D graphics so that almost anyone can access this kind of environment, and you don’t need a lot of expensive hardware like goggles. That said, will the Metaverse always be dominated by gamers? What about more serious use cases, like training surgeons on 3D organ models? Or educational uses, like a virtual class trip to an ancient Greek Agora? NS: When Snow Crash came out in 1992, virtually all video games were 2D. But then Doom came out in 1993, and it was the first broadly used 3D game. It spawned a vast industry of similar games. The World Wide Web’s source code was also released in 1993, and suddenly you can look at pictures on your computer. All those things together pushed millions of people to want to own computers with much more advanced graphics capabilities. That turned out to be that industry’s I Love Lucy moment.CT: I Love Lucy?NS: It’s what happened to television in the 1950s, where there was this kind of virtuous cycle where millions of people wanted to watch the I Love Lucy television show, so they bought TVs. The increased sales volume enabled hardware manufacturers like Magnavox and RCA to bring down the price of TV sets, which in turn made I Love Lucy even more accessible and popular. That’s how industries grow.Recent: Sentiment and inflation: Factors putting pressure on Bitcoin priceVideo games have led to incredible, many-order-of-magnitude advances in the 3D processing power you can get out of a device per dollar spent. CT: Will game playing, then, continue to be the main thing that happens in the Metaverse?NS: I think what is possible is that 20 or 30 years from now, people who are using immersive experiences will look back on games as: “That’s how we got here.” It used to be, these things were all video games, that’s where the hardware came from, where the toolsets came from, the people who create immersive experiences learned their skills from video games, and so on. And, there will still be lots and lots of video games, but there also will be experiences that will be something more, and I think you see that already if you look at Fortnite, which is obviously a video game, but it is also a social environment. Edited by Aaron Wood

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Block by block: Blockchain technology is transforming the real estate market

Block by block: Blockchain technology is transforming the real estate market

Uverejnil používateľ | júl 22, 2022 |

Property is the world’s single largest store of wealth, and if the cryptocurrency and blockchain world is seeking an express route to mass adoption, it could do worse than partnering with the real estate industry. According to a September 2021 report by Savills World Research, the estimated value of all the world’s real estate stands at $326.5 trillion. By comparison, crypto-sector market capitalization was about $1 trillion in mid-July. The property market, moreover — at least its commercial real estate segment — is also characterized by costly entry barriers and asymmetrical information that favor insiders. Its fees are high, paperwork onerous, and deeds are sometimes defective, falsified or missing. Some properties can take years to move — another way of saying its market is illiquid. All in all, it isn’t surprising that many believe this market is ripe for disruption, particularly through blockchain-enabled tokenization. This notion of tokenizing real estate isn’t entirely new. As far back as 2019, for example, a 6.5-million-euro villa in Boulogne, outside Paris, was tokenized. One million shares were put up for sale on the Ethereum blockchain, the first property in France ever sold as a blockchain transaction. An individual could have purchased a part of the luxury villa for as little as 6.5 euros. Will everything be fractionalized?Last year’s nonfungible token (NFT) breakout — and real properties are nonfungible, i.e., not interchangeable — along with some more supportive regulations, like Regulation Crowdfunding (Reg CF) in the United States, have trained the spotlight more squarely on crypto and property partnerships. This year’s metaverse hype, including Yugo Labs’ record-breaking virtual land auction, has not discouraged activity in the real property world, either. “Web3 will be all about ownership, owning fractionalized shares,” says Bobby Singh, founder of the NiftySky DAO, speaking at June’s NFT.NYC 2022 convention, which featured an entire track on tokenized real estate. “Imagine fractionalizing the Empire State Building into 2 billion shares.” An individual could own a piece of the Empire State Building for several dollars. Times Square during NFT.NYC 2022 conventionOwnership creates its own momentum, Singh continued. “If you become a collector, an owner, you’re more likely to talk about it.” More owners mean more excitement. “The concept of title is very important.”“Blockchain has the potential to transform real estate,” Lamont Black, associate professor in DePaul University’s department of finance and real estate, tells Magazine. Real estate is all about records of ownership and how a property is financed, he explains, and “blockchain is ideally suited as a shared system of record-keeping for this type of application.”Many of these principles are “already being applied to digital real estate in the metaverse,” adds Black, while the ideas behind Web3 — of which the metaverse is one part — “are very much rooted in ownership of digital assets, including basic things like personal data.”“The efficiency and certainty that comes with tokenization is undeniable,” David Tawil, president and co-founder at ProChain Capital, tells Magazine, and this hasn’t been lost on the real estate industry. A market that dwarfs the cryptoverseIf one accepts Savills’ numbers, the value of the world’s real estate is more than 300 times the size of the crypto and blockchain sector, which recently slumped below $1 trillion in market capitalization. That disparity hasn’t been lost on observers. “If even just 0.5% of the total $280 trillion global property market were tokenised in the next five years, it would become a $1.4 trillion market,” wrote Moore Global, a global accountancy, advisory and consulting network in August. Alternatively, if one uses Savills’ estimate of a $327-trillion market: If just 1% of the global real estate market were tokenized, it would triple the current market cap of the entire cryptocurrency world. About four-fifths of the world’s real estate is residential, according to Savills. Commercial real estate accounts for only about one-tenth of the total, but that might be where tokenization first makes an impact, some say.Singh, a veteran of the New York commercial real estate business, explained at the NFT.NYC convention that the legacy commercial real estate market has “a lot of friction” and is burdened by a lack of liquidity. Innovations like blockchain-based NFTs can help with record-keeping because the blockchain is transparent, “and fractionalization will make real estate more liquid.”“We believe this market will be more open to alternate sources of capital raising, including tokenization,” Navonil Roy, CEO of United Arab Emirates-based LandOrc, tells Magazine. His firm facilitates lending for the real estate industry by providing access to decentralized financing, using land titles in nonfungible token form as a collateral. Capital formation is often an obstacle in real estate ventures, and tokenization can “open the door for a broader pool of investors,” Sean Stein Smith, assistant professor in the department of economics and business at Lehman College, tells Magazine, “by being able to tokenize and bifurcate the ownership and custody of the underlying physical real estate asset.” It can also enable peer-to-peer secondary transactions so “a robust second market can also be developed.”The fact that crypto transactions are conducted in real-time offers potential advantages, too, such as “increasing the speed with which mortgages are approved and transactions are completed,” adds Stein Smith.Obstacles remainDespite the enormous potential, blockchain technology has made relatively small inroads in the area of property rights so far. The Boulogne villa cited above was more of an exception than a rule. “Blockchain is a technology that requires coordination among market participants. Until there is more adoption of this technology, the impact will be limited,” Black tells Magazine, adding:“Another hurdle is the role of government. Because real estate title is largely regulated by local governments, the recording of ownership on a blockchain will require government adoption as well. The forward-thinking and nimble municipalities will lead the way.”The “promise” of a globalized, tokenized real estate market with secondary market trading has taken some time “because it required getting multiple licenses,” Max Dilendorf, partner at the Dilendorf Law Firm and who has been working on real estate tokenization projects since 2017, tells Magazine. Securitize LLC led the way, he says, becoming a U.S. Securities and Exchange Commission-registered transfer agent operating on the blockchain about three years ago, but “companies have spent years and years to get licenses in the U.S.” as well as Asia and Europe. Another obstacle is that so much of the required data to complete a tokenized real estate transaction does not occur natively on the blockchain. It has to be entered manually. University of Basel professor Fabian Schär, for example, wanted to invest a few hundred Swiss francs in a multifamily house in Detroit, as he recounted in a May 2022 Credit Suisse Insights interview:“‘The technical process related to the token functioned seamlessly.’ But then came something that made Schär cancel the transaction: ‘There were around 150 pages of legal documents that I had to read and sign.’”The real estate sector, too, is sometimes resistant to change, which could impede adoption. “Real estate brokers and agents are relatively conservative in their adoption to new technology due to both the monetary sums involved and the implications associated with property ownership rights,” notes Stein Smith. More success stories may be required, too, before things really get moving. “Real estate owners looking to raise money have a single goal: lower cost of capital,” Yael Tamar, CEO and co-founder of SolidBlock — a real estate tokenization platform — tells Magazine. “Until they are convinced that there is an audience of investors looking specifically for property-backed security tokens, they will not bother with nice-to-have solutions.” Then, too, the DeFi summer may have inadvertently slowed things down, with DeFi lenders becoming “spoiled” by the unusually high lending returns they enjoyed during this highly liquid period, suggests Roy, adding:“Their expectations of returns in the digital asset world cannot be replicated with real world assets, which are grounded by real world economics. This change in mindset is the most daunting obstacle.”The path ahead could be long, too. When Savills’ Marie Hickey, director of U.K. commercial research, recently wrote about “four trends shaping retail real estate globally,” there was no mention at all of tokenization or blockchain technology. Asked about this, Hickey tells Magazine, “Tokenized real estate is just too insignificant to be cited as a key trend at this point.” Positive regulatory developments in the U.S.Still, recent regulation changes in the U.S. could prompt a boom in tokenized projects in Dilendorf’s view. Reg CF, whose fundraising cap was boosted from $1 million to $5 million in late 2020, “will pave the way,” predicts Dilendorf. Reg CF enables a company to fundraise among both accredited and non-accredited investors, and there is no cap on the number of investors who can participate. Meanwhile, alternative trading systems (ATS) based in the U.S. are building bridges to ATS platforms in Europe and Asia. “So, now if you put your digital real estate token on a platform in the U.S., an investor from Europe or Asia can participate in a secondary market trade,” Dilendorf tells Magazine. This could boost the secondary market substantially. Transaction fees are low on these blockchain-based ATS platforms like Securitize as well, while smart contracts ensure that transfers are executed between Know Your Customer-verified accounts only. “It’s the creation of a new way to raise capital for small firms,” which is almost like an initial public offering, adds Dilendorf.NFTs or simple tokenization?What form might property tokenization take? Are NFTs most promising? Simple tokenization? Or maybe some other forms, such as Soulbound tokens, or SBTs, as proposed recently by Vitalik Buterin?Tamar says tokenization could assume a variety of forms. “Some will have a part of their cap table on Web3 (for decentralized finance); some will issue NFTs for timeshares and rentals; and others will use tokens for payments or asset management.”Like, sometimes people send me hitler coins to my public .eth address, and I don’t have a way to stop this, but it doesn’t really hurt me because etherscan doesn’t show them unless you intentionally scroll all the way down the really long list of spam tokens. SBTs are similar.— vitalik.eth (@VitalikButerin) May 12, 2022Jarib Figueredo, a candidate for the State House of Representatives in the U.S., who joined Singh on the NFT.NYC 2022 panel on “Understanding the Value of Tokenized Real Estate,” notes that “in Florida, there are issues transferring deeds, and these can be improved with NFTs — digital files that can prove ownership.” Timesharing is another promising use case. “In the future, real estate title could be issued as a nonfungible token,” Black tells Magazine. “The owner of the property would maintain ownership of the token in a digital wallet. Changes in the value of the property would be reflected as changes in the value of the NFT.” Further:“When the owner wants to sell the property, they could list the property NFT on an NFT exchange. Buyers could bid on the NFT, and the NFT would be transferred to the digital wallet of the winning bidder. This would make the secondary market for real estate much more liquid and transparent.”Dilendorf, for his part, doesn’t see NFTs or DAOs playing a dominant role in the real estate marketplace because they are essentially unregulated, unlike Reg CF-enabled digital securities, which are SEC-sanctioned.Which kind of real estate projects are most ripe for tokenization? “Landmark assets will be the most successful,” says Tamar, “and top-tier stadiums will fall under this category. Large institutional quality properties will be more likely to get tokenized, as they will experience more liquidity, and they will attract institutions during the primary sale unlike smaller properties.”Raising up the world’s poorBlockchain technology, too, can be of use in large swaths of the developing world where the existing infrastructure for ensuring property rights is weak or non-existent, Black tells Magazine, referencing Peruvian economist Hernando de Soto, who has argued that property rights are the key to economic growth. “If blockchain can improve property rights like real estate ownership in developing countries, this could be transformative for entire economies,” says Black.In an oft-cited Wall Street Journal opinion piece, de Soto emphasized blockchain’s ease-of-access record-keeping that can be continuously updated as property ownership changes. Most of the world’s population has no access at all “to a formal system of property rights,” he wrote, adding:“If Blockchain technology can empower public and private efforts to register property rights on a single computer platform, we can share the blessings of private-property registration with the whole world.”Global disrupter or niche player?Can the crypto industry reach a point in the future where a significant proportion of real estate will be tokenized — e.g., more than 10% of the global real estate universe — or will this remain a niche area?“I can imagine that day” — i.e., 10% tokenization — says Tawil, ”but tokenization of real property ownership is likely going to take some time, especially in places like the United States where large infrastructural changes will be required.” Property deeds are recorded and stored in thousands of municipal offices, after all. These will have to be digitized. Then, too, there exists “a large lobby of professionals that profit from property transactions, which may be marginalized or eliminated in a tokenized property ownership world, such as lawyers, title insurance, brokers, etc.,” Tawil tells Magazine.Cointelegraph Research report, available for purchase on the Research TerminalAccording to Black, “Tokenization of 10% of the real estate market is not too difficult to imagine.” Blockchain and NFTs provide a digital record of ownership that can be associated with physical assets, including real estate, autos “and any form of durable good.” “My prediction is that a large part of the property market will be tokenized to leverage the blockchain economy, but the top 20 percentile — by demand, size, performance, brand, location, etc. — will enjoy 80% of the financing opportunities,” adds Tamar.As with any disruptive technology, some business sectors could suffer if tokenized property catches on. Title insurance companies could be among the first to feel the pain. “Once there is a clear and transparent ledger that records who owns a property and whether there are any liens on the property, there will no longer be any justification for title company fees,” Black tells Magazine. Still, success often begets success, or as Black puts it: “As societies become more familiar with blockchain as an infrastructure for maintaining digital assets, this could open the door for applying some of these same principles to physical assets like real estate.” 

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