Bitcoin Bits: 16 May, 2016

A roundup of interesting articles about bitcoin and the blockchain that I stumbled across during the week.

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The Dao

The big subject of the week was the runaway success of The DAO crowdfunding sale. Launched at the end of April, it has surged ahead to raise $150m, which makes it not only the largest crowdfunding project in history, but also the most funded cryptocurrency project, ever.

So many insightful pieces have been written about this phenomenon over the past few days, that I’m not going to parse and extract here. I will, however, leave you with links to some of the ones that I found most interesting. These links should give some idea of the controversy this new development is generating. The concept is interesting, definitely. But I don’t believe that it is going to revolutionize how companies are set up, and I don’t believe that it will have the fundamental change on the way that we do business that some enthusiasts are claiming.

The price of Ether, a bitcoin rival, is soaring because of a radical, $150 million experiment – by Joon Ian Wong, for Quartz

Public Opinion Split As The DAO Rakes in Ethereum Funding – by Stan Higgins, for CoinDesk

The “Autonomous Corporation” Called the DAO Is Not a Good Way to Spend $130 Million – by Tom Simonite, for MIT Technology Revies

The Tao of “The DAO” or: How the autonomous corporation is already here – Seth Bannon, for TechCrunch

Is the DAO going to be DOA? – by Dan Larimer, via Steemit

#THEDAO: Broken, but worth fixing – by Preston Byrne

Holy DAO! Reflections on the $155 Million (And Growing) Autonomous Behemoth – by Jeremy Gardner, for Bitcoin Magazine

Can A Company Be Run Without Leadership, Management Or Employees? $150m Invested In The DAO Says Yes – by Jonathan Chester, for Forbes

More decentralised autonomous organisation (DAO) mysticism – by Izabella Kaminska, for The Financial Times

Introducing the DAO: The organisation that will kill corporations – by Harriet Green, for City AM

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Check out these amazing photographs of night-time Tokyo, by Liam Wong. Luminous, dark and colourful, you can imagine a deep voice in the background narrating the accompanying story. (Via Colossal)

by Liam Wong via Colossal
by Liam Wong via Colossal

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On Blockchain Disillusionment and Bitcoin’s Big Bad Wolves – by Pete Rizzo, for CoinDesk

2016 was supposed to be the year of the blockchain. And yet, not even half way into it, already the clouds are gathering. Some notable blockchain platforms and service providers are toning down their business models. And in spite of months if not years of testing, there has yet to be a successful (by which I mean implementable) blockchain trial in “traditional” sectors such as finance and trade.

“The spinning of the tires on such attempts perhaps hasn’t been audible given that, while bitcoin’s problems were and still are largely public, the institutions experimenting with blockchain have done their best not publicize those struggles.

Still, there has been a noticeable change in tone among those working close to such efforts.”

Meanwhile, the media seems to be giving bitcoin a break and overlooking its governance issues and scaling bottleneck. Perhaps this is because the media has moved on to the blockchain hype.

“…months of infighting among network developers seems to have done little to cause bitcoin’s price to decline or its rate of new wallet or ATM growth to decrease. Further, Bitcoin Core, its main development group, seems more coordinated than ever, even if they’re operating more as the kind of unified entity they perhaps sought to avoid.”

So if we are emerging from bitcoin’s “trough of disillusionment” (so soon?) and while blockchain hype has crested its peak and is heading into the trough, can the two concepts achieve some sort of equilibrium?

“Rather than seen as a replacement for public blockchains, there’s a broader recognition that such technologies are best compared to “the Internet”, while permissioned efforts should be considered “Intranets”.”

Can technology really “solve” problems? Are the changes that it brings about “solutions” or “evolutions”? In the early ‘90s, the Internet was hailed as a replacement for cable television. Can Netflix really be called a “solution” to quality viewing?

“Rather, it simply altered the reality and the experience, providing some benefits along with some new hassles. It’s hard to imagine bitcoin and blockchain won’t deliver similar results.”

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Blockchain open sources Thunder network, paving the way for instant bitcoin transactions – by Romain Dillet, for TechCrunch

Could this be the beginning of the era of sidechains? It’s clear that bitcoin has a scalability problem, and that micro-transactions are not yet practical on the network. Sidechains look like an interesting solution, while at the same time opening up new technological possibilities.

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This vision of an always online world is totally disturbing. By Keiichi Matsuda, via FastCoDesign.

HYPER-REALITY from Keiichi Matsuda on Vimeo.

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Blockchain and the Race Towards Irrelevance – by Matthew Spoke, for CoinDesk

On how the tone of the blockchain evangelists has become more entrepreneurial…

“As was the common rhetoric in the earlier days of bitcoin, blockchains open the potential for the disintermediation of not only these established businesses, but entire industries. Since this message seemed to shut more corporate doors than it opened, the “blockchain industry” slowly but noticeably adjusted its messaging to take a less hostile tone; where corporations were no longer necessarily the targets of the coming disruption, but instead, the forward-thinking ones could become the vessels of change.”

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Behind the Biggest Bitcoin Heist in History: Inside the Implosion of Mt. Gox – by Jake Adelstein and Nathalie-Kyoko Stucky, for The Daily Beast

Years later, this is still a good story. And it’s getting stranger.

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The Top 5 Takeaways from CoinDesk’s State of Blockchain Q1 2016 – by Pete Rizzo, for CoinDesk

CoinDesk’s State of the Blockchain report is always worth a good perusal. Here are what CoinDesk editor Pete Rizzo thinks are the top 5 highlights (I imagine it must be difficult to choose):

  1. VC interest rebounds
  2. Blockchain funding spikes
  3. Ethereum’s big boost
  4. Media interest in blockchain
  5. Regulators bang blockchain drum

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