Best TruStories of the Week - #9


#1

Please use the below format:

Claim:

Category:

Source:

My Stake: [Challenge claim or Back claim] (10, 50, or 100 Cred)

My Argument/Evidence:

For categories, select from one the following:

  • Crypto glossary
  • ELI5 for crypto
  • Projects (Bitcoin, Ethereum, EOS, Stellar, Brave, etc.)
  • Regulation
  • Mining
  • Scalability
  • Use cases
  • Scams
  • Stablecoins
  • Governance
  • Consensus protocols
  • Privacy & Security
  • Enterprise blockchains
  • Crypto funds & fundraising
  • Token Economics
  • Markets

If your claim doesn’t fit into any of these, you can request to add a category and we’ll consider it.


#2

Claim: Satoshi hard forked Bitcoin in 2010 to remove the 184.467 billion Bitcoins created out of thin air by a hacker.

Source: https://hackernoon.com/bitcoins-biggest-hack-in-history-184-4-ded46310d4ef

Category: Bitcoin

My stake: Back claim (100 Cred)

My Argument/Evidence: There are 2 threads on Bitcointalk (the official Bitcoin forum) which illustrate this event happening. The event was first reported on August 15, 2010, 07:04:11 PM here: https://bitcointalk.org/index.php?topic=823.0. Within 5 hours of it being reported, Satoshi released version 0.3.1 of Bitcoin which patched up this bug and rewound the blockchain to erase the hacked 184.467 billion Bitcoin.

Code to patch up the bug: https://bitcointalk.org/index.php?topic=823.msg9530#msg9530

I found it fascinating how much social coordination was involved in making this fix happen. There was a comment where Satoshi said:

“It would help if people stop generating [blocks]”

… and someone else responded saying

“I’m afraid the community is just too big and distributed now to expect much in the way of voluntary quick action on anything, especially generation which I’m sure many have on automatic and largely unmoderated.”

Also, it was fascinating to see the discussion around how Satoshi planned to remove the hacker’s bad transaction/block (again, where a lot of social coordination was required). Basically, the plan was to ask everyone to:

  1. shut their nodes down
  2. download the valid blocks until block 74000 (but not block #74000 because that is the block with the hacker’s transaction)
  3. upgrade their nodes (to include the bug fix Satoshi made)
  4. re-download the rest of the blocks with the updated code which fixes the bug (such that only the hacker’s bad transaction and coins generated were removed, and all other transactions continue to exist).

There were some hiccups along the way (e.g. un-upgraded nodes would sometimes include the bad transaction and end up trying to fork and generate invalid blocks) but it ended up working, and the good chain overtook the bad chain around block 74689 :slight_smile:

This is why I find it hilarious when people (e.g. maximalists) gawk at “social coordination” as being a bad thing. We’re human. Not everything can be codified perfectly… especially in the early days of a protocol when it’s still nascent and bugs are inevitable.

More details here:

https://bitcointalk.org/index.php?topic=823.msg9530#msg9530
https://bitcointalk.org/index.php?topic=823.msg9734#msg9734


#3

Claim: 70% of France is threatening to exchange all their fiat currency to Bitcoin

Category: Regulation

Source:

and https://cointelegraph.com/news/what-we-know-about-yellow-vests-bank-run-and-how-crypto-could-help-it

My Stake: 100 Cred (reject claim)

My Argument/Evidence: The claim found in the article suggests that 70% of France’s population is part yellow vest protester who is protesting the French government’s wealth tax policy.

  • Background on yellow vest movement: People are protesting France’s wealth tax policy where they believe the working and middle class do not have a living wage. They are saying, " They say their incomes are too high to qualify for social welfare benefits but too low to make ends meet." (source: NPR) Basically, they are frustrated with their government failing them and threatening to destabilize the government by withdrawing all their bank accounts and buying crypto.

  • False claim #1, 70% of French’s population is involved with yellow vest movement. France currently has a population of 65 million people (source: http://www.worldometers.info/world-population/france-population/). The French ministry estimates 150,000 people participated in the protest in December (Source: Dept of Interior)

  • False claim #2, Saturday, January 12, 2019, protesters will withdraw bank accounts and do a bank run for crypto. According to Coin Dance’s weekly trading volume for Europe on the week of 1/12/19, Bitcoin volumes decreased. Coin market stat’s shows a decrease in market cap of Bitcoin for that week too, implying less trading activity for Bitcoin that week.


  • From evidence found, I do not believe 70% of France’s population did a bank run and bought crypto. I couldn’t find any reports of increased Bitcoin purchases in France or French banks having less accounts.


#4

Claim :

  • Parity Technologies has received a $5 million grant from the Ethereum Foundation.
  • This is the largest award to date by the Ethereum foundation.

Category : Projects (Ethereum)

Source : https://www.theblockcrypto.com/tiny/parity-progresses-with-5-million-grant-from-ethereum-foundation/

My Stake :

  • Back claim (100 cred)
  • Back claim (50 cred)

My Argument/Evidence :

  • Source points to blog post by Parity technologies where announcement regarding the grant was made.
  • The same can be confirmed from Ethereum blog here

The Ethereum Foundation is thrilled to announce a scalability, usability and security grant of five million dollars (USD) to Parity Technologies.

  • Previous highest grant seems to be $4M with 6K ETH Performance-based Bounties for Starkware as announced here on the Ethereum blog.

#5

Claim: 2020 US presidential candidate and current Hawaiin congresswoman Tulsi Gabbard owns crypto assets.

Category:

Source: https://smartereum.com/46612/cryptocurrency-presidential-candidate-tulsi-gabbard-the-cryptocurrency-investor-who-is-now-running-for-president-calls-out-banks-cryptocurrency-news-today/

My Stake: Back with 100 Cred

My Argument/Evidence :
Gabbard filed a Financial Disclosure Report with the House of Representatives that showed holdings of Ether and Litecoin in a filing in 2018. The value is listed as within the wide range of $1,000 and $15,000 for each asset.


#6

Category: Ethereum

Source: https://www.theblockcrypto.com/2019/01/14/vlad-zamfir-is-joining-a-vc-backed-startup-racing-to-launch-the-casper-upgrade-ahead-of-ethereum/

The following claims are about Vlad Zamfir, a leading Ethereum researcher.


Claim: Manohar said that Zamfir has so far signed an IP licensing agreement and a letter-of-intent with Casper Labs, while a final contract is pending. Casper Labs will be Zamfir’s main financer but he will not be an employee, the company said, and all of his research will remain fully open-source.

My Stake: Back with 50 Cred.

My Argument/Evidence:

Manohar is quoted as the Casper Labs CEO in the post which seems a credible source.

Vlad confirms a letter-of-intent to negotiate with Casper Labs on Twitter:

10%20PM


As Vlad’s tweet notes, the primary controversy around this article is the journalist’s implication that Vlad is jumping ship to Casper Labs from Ethereum. The evidence points otherwise.

Claim: Vlad Zamfir is stepping back from the blockchain empire to collaborate with Casper Labs.

That is the first sentence of the piece. The author later notes that Vlad was leading a popular version of Casper.

My Stake: Challenge this claim with 100 cred.

My Argument/Evidence:

Vlad disputes this claim on Twitter:

41%20PM

Vitalik also disputes this claim:

06%20PM

He also dismisses the idea that Vlad only works on one idea:

36%20PM



#7

Very clever.

2 things I liked.
You pieced together the stat about the percentage of people being yellow vest protesters even though it wasn’t given anywhere. Brilliant.

I also really liked how you gave background about the yellow vest movement. It was informational but also gave me context reading your analysis.

One piece of feedback. I would change the category of this claim to Bitcoin or Politics (don’t have it currently but we can make it a suggested one). Governance isn’t as apt here.


#8

Awesome, thanks! What current category should I edit the claim to?


#9

Claim : Our team at Centrifuge has been working on turning these financial documents into NFTs on Ethereum with the goal to make them first-class blockchain citizens.

Category : Use cases, Projects (Business NFT/ERC-721)

Source : https://medium.com/centrifuge/introducing-business-nfts-financial-business-documents-as-tokens-on-decentralized-networks-ec4b773f7ec5

My Stake : Back claim (10 Cred)

My Argument/Evidence: It looks like Centrifuge is a legit startup in SF, CA. They got some funding from Mosaic ventures in 2018.

Unknown:

  • Is it possible to implement the tokenization of physical goods? Coming soon
  • Does the system offer sufficient data security and data privacy aspects? https://www.centrifuge.io/assets/Centrifuge%20OS%20White%20Paper.pdf
  • Does the system support decentralized data storage with sufficient performance? Projects like IPFS,8 BigchainDB,9 or Ocean Protocol10 are promising methods for solving
    distributed public storage of large files, distributed storage of data as assets, and creating
    marketplaces for data streams that allow data owners to monetize their information.
    Projects such as Keep11 and NuCypher12 are on their way to innovating decentralized
    encryption, storage, and retrieval of private data. The Centrifuge team will continuously
    evaluate both established and emerging technologies that support distributed,
    decentralized, public computation and data storage in a secure and scalable environment.
  • Does the system offer smart contracts , i.e. the execution of decentralized applications? Centrifuge OS
  • Is the immutability of the data ensured? The anchor registry used to prove authenticity of document
  • Is the data stored permanently? The Centrifuge team will continuously evaluate both established and emerging technologies that support distributed, decentralized, public computation and data storage in a secure and scalable environment.

I just signed up to give feedback to their review-phase of a technical paper called “Business NFTs: Non-fungible tokens with private off-chain financial data”. I will update on how it goes. https://techcrunch.com/2018/03/06/blockchain-company-centrifuge-wants-every-business-to-get-paid-on-time/

It sounds like a private blockchain: they are more closely related to local database than public blockchains. Entries may not be publicly viewable, editing permissions may be restricted and nodes may need approval by a system administrator. They may even be able to be edited retrospectively. While this implementation has benefits for data security, it centralizes control to a few parties. This detracts from the benefits of decentralization and immutability of public blockchains. Source


#10

You can use “Regulation”


#11

Claim: Factom is dangerously centralized and controlled by five people

Subclaims:
These are the Subclaims made in the subreddit post

  • Factom has a group of five guides that get to select who becomes one of the 26 nodes.
  • All five guides voted themselves in to run a node.
  • According to the creator of the protocol, it will be run this way for years to come.
  • Factom considers itself a proof of usage protocol which means those who use the protocol the most (burn factoids) have the most weight. Considering very low usage of Factom protocol currently the proof of usage makes it cheaper to spam transactions and take over the Factom network.
  • No clear definition on protocol or governance in Factom. They are just making things up on the go.
  • Factom has been linked to multiple partnerships, but it’s easy to see from the poor usage that they’re using private iterations (if any) which would accrue zero value to Factom tokens.

Category: Projects

Source: https://www.reddit.com/r/CryptoCurrency/comments/adujzc/factom_is_dangerously_centralized_and_controlled/?sort=confidence

My Stake: Challenge Claim (100 Cred)

My Argument/Evidence:

Factom in a nutshell:

Factom Inc.’s business model is to sell Blockchain as a Service, for which they leverage the Factom blockchain protocol they created. Factom Inc is a private company based in Austin whereas Factom blockchain protocol is an open-source, decentralized protocol in use by dozens of different companies, not only Factom Inc. Factom blockchain protocol is the framework of how the system works and includes the distributed consensus algorithm*,* Factoids (FCT), Entry Credits (EC), Authority Nodes, FCT-EC-conversion, the data-structures, block-times etc. The Factom blockchain is a decentralized publication protocol for building record systems that are immutable and independently verifiable. It enables secure storage of digital proofs for data provenance and integrity solutions without disclosing private data or requiring trusted intermediaries. Unlike other public blockchains, Factom uses a distributed ledger architecture that allows related entries to be linked chronologically in a chain for more efficient storage and retrieval. Entries can contain any kind of data but are not intended for storing private data. Entry data is hashed before being written into an entry block, and the actual entry data is stored in distributed hash tables and shared peer-to-peer. Factom uses two tokens on the network: Factoids (FCT) & Entry Credits (EC). FCT is just like any other token and can be traded in exchanges. Factom servers receive Factoids as a reward for maintaining the network. The network releases these rewards at a fixed rate (~73,000 per month) in a process that’s independent of their price. You can use Factoids to purchase Entry Credits through the protocol. Also, you can purchase EC directly with the currency of your choice. Entry Credits are non-transferable and you can only use them to pay for Entries or to vote for Authority nodes. You need to spend Entry Credits to add data to the Factom blockchain. The user submits an Entry Payment using a public key associated with Entry Credits. Based on the public key used to pay for the Entry, one of the servers accepts the payment. That server broadcasts the acceptance of the payment. The user sees the acceptance and submits the Entry. Based on the ChainID of the Entry, one of the servers adds the Entry to its process list and adds the Entry to the appropriate Entry Block for that ChainID. Each Entry that you submit has a Chain ID. The Chain ID determines which sub-group should include the Entry. Entries have a maximum size of 10KB, but you can use multiple Entries to link together larger files. A sequence of Entries forms a Chain. The Chain records the order of the Entries which leaves an audit trail. Chains are like folders, and Entries are like the files that you place into folders. An Entry Block is a group of hashes of all the Entries with a particular Chain ID. It’s important to note that the Entry Block contains just the hashes, not the actual data of the Entries. The server broadcasts an Entry confirmation and all other servers update their view of the Entry Block for that ChainID. At the end of the 10th minute, a Directory Block is constructed from the hashes of all the Entry Blocks defined by the process lists built by all the servers. So, each server has all Entry Blocks, all Directory Blocks, and all Entries. At the completion of the Directory Block, the Merkle root of the Directory block is placed in a Bitcoin transaction and submitted to the Bitcoin network for eventual confirmation. Anchoring into other public blockchains allows for interoperability and third-party security. The public Factom blockchain is governed by a peer-to-peer network of federated servers whose membership is based on performance and community support. Anyone can read entries and submit write requests for a fixed cost based on chain and entry size. The Factom protocol is open source and anyone can run a follower node or create a private network for development and production use cases.

Guides and Authority Node Operators [ANO]

Guides are a group of entities charged with facilitating the orderly operation of the protocol. Authority Servers are the set of Federated Servers and Audit Servers which share responsibility for different aspects of the system. The Federated Servers actually acknowledge and order entries and transactions
in Factom, and Audit Servers duplicate and audit the work done by the Federated Servers and are always ready to replace a Federated Server that might go offline. Authority Node Operators are companies that are elected by the Standing Parties and operate the server infrastructure that decentralizes the Factom protocol. Standaing Parties are Factom Guides (5), Authority Node Operators (the goal of 65), FCT-holders (stakers) and protocol users (Entry Credit spenders).

Claim Analysis:

  • Factom has group of five guides that get to select who becomes one of the 26 nodes.

Factom has 5 guides to look over the protocol operations. The initial 5 guides have been chosen by the community in Apr 2018 of which 3 guides are still in position. An election is scheduled for Mar/Apr 2019 at which point all guides could be replaced (besides the removal option). Factom has 26 ANO which are 26 independent companies working to produce public usage of the protocol

  • All five guides voted themselves in to run a node.
  • According to the creator of the protocol, it will be run this way for years to come.

When Factom went decentralized in 2018 some people becoming a guide also got involved as an Authority Node Operator. All 5 guides initially selected were longtime members of the community (hence why they got elected Guides in the first place), it was also natural that these guides had formed companies to apply to become Authority Node Operators - and that these teams were very well prepared when applying. But there were other ANO’s selected which are independent of these guides and across different geographic regions. Future selection of authority node operators will be done by the standing parties as is done for the grant rounds.

  • Factom considers itself a proof of usage protocol which means those who use the protocol the most (burn factoids) have the most weight. Considering very low usage of Factom protocol currently the proof of usage makes it cheaper to spam transactions and take over the Factom network.

Factom has several standing parties and no one party controls the network. It has:
Proof of Stake - Holders of the FCT token who “Stake” it will receive voting rights in governance.
Proof of Use - Those that use “Entry Credits” to input data into the Factom blockchain will receive voting rights in governance.
Grant Success - Those that apply for and are awarded grants that they successfully execute will receive voting rights within governance.
Factom Protocol is actually quite decentralized already, with 13 entities required to facilitate a 51% attack, vs 5 pools for Bitcoin, 3 for bitcoin cash, 4 for Etherum, 3 for Litecoin and 2 for Etherum Classic. (based on mining pool hash rates)
Factom usage metrics here.
https://factoshi.io/

  • No clear definition on protocol or governance in Factom. They are just making things up on the go.

Factom community crowd-sourced a Factom Governance document which would govern the election processes and the community. Factom white paper and governance document can be found here.
https://www.factom.com/factom-blockchain/

  • Factom has been linked to multiple partnerships, but it’s easy to see from the poor usage that they’re using private iterations (if any) which would accrue zero value to Factom tokens.

Factom made headlines about partnerships with Equator and Yooya utilizing Factom. Linxens has also indicated that they will be using Factom for their new product.Paul Snow, the CEO of Factom, Inc, has stated that he expects significant public chain usage from these partnerships. “It’s true that we can only make assumptions because the specifics of the actual usage is not public, but because they were just announced last month, it’s a reasonable assumption that they are still testing and integrating at this point, which is why we are not seeing public usage.”

https://bitcoinexchangeguide.com/yooya-to-use-factom-harmony-blockchain-for-video-verification-in-china/
https://www.nasdaq.com/press-release/equator-launches-mortgage-servicing-blockchain-solution-20181113-00843


#12

Claim : Denmark’s and Bulgaria’s tax authorities are targeting cryptocurrency exchanges to disclose trade data

Category : Governance

Source : https://cryptonews.com/news/crypto-tax-crackdown-denmark-bulgaria-begin-purges-3204.htm

My Stake : Back claim (100 Cred)

My Argument/Evidence :
(1) Confirmed via the press release posted on the Danish Tax Agency (Skattestyrelsen) Site (translated to English) https://www.sktst.dk/aktuelt/pressemeddelelser-og-nyheder/skattestyrelsen-indhenter-oplysninger-fra-danske-kryptoboerser/
The Tax Council (https://skat.dk/skat.aspx?oid=2284259&lang=da ) has authorized the Tax Agency to obtain information on trade in crypto currency via three Danish crypto exchanges in the period 2016 - 2018. According to the press release, once the information is received, the Tax Agency will ensure that citizens who have traded with crypto currency have paid taxes (tax information related to crypto-currency https://www.skat.dk/skat.aspx?oid=8953 ) Information on transactions made by foreign citizens and companies in which the National Tax Board holds possession will be exchanged with the respective countries’ authorities.

(2) Confirmed via update on The Bulgarian National Revenue Agency (NRA) site (http://www.nap.bg/ translated to English) The NRA is launching inspections of companies whose subject-matter is the sale of cryptocurrency. The objective is to establish whether companies and their clients comply with tax and social security legislation. More information on the declaration and payment of income from cryptocurrency to NRA clients can be obtained from the NRA Information Center on 0700 18 700


#13

Claim: Mo Equity Mo Problem (Delaware C-corp)

Category: Regulation (STOs/IEO)

Source https://corp.delaware.gov/fee/

My Stake : Back claim 100 cred

Argument/Evidence : Delaware is a popular destination among startup entrepreneur, is not without merits, Delaware is where the corporation concept been born in the early 20th century. Over 50% of publicly traded corporations in the United States and 60% of the Fortune 500 are incorporated in the state.

What is the problem?
Incorporation in Delaware as to pay a corporate franchise tax on a stock certificate which is based on par value or no par value.

So what is the problem?
Let’s say (xyz) corporation want to issue a billion shares, the franchise tax will be $200k USD/years, ouch!

So what is the problem?
Probably the first question a lawyer would ask you is why a billion shares?

Re: Having a large number of shares on your stock corporate certificate is important because when you scale bottom up (internet of value), your number of shares issued represent your biggest weapon. That scenes What is the Problem? from the movie Moneyball depict the problem all startup has very clearly!

Option:

  • The first option will be to incorporate elsewhere like Wyoming which is more business friendly for startup.

  • The second option will be to duplicate the shares issued at a later date, this way you can delay those tax franchise fees, but it’s a bit more complicated and you will pay extra $ for the capital structuration, and you still end up paying those fees.


#14

Those were really cool bitcointalk threads.

Back the claim: 50 cred

They even coordinated on shifting mining resources on a public forum:


#15

Claim: “South Koreans pay a higher price for bitcoins than traders in other countries.”

Category: Regulation, Governance, Token Economics & Markets

Source: https://www.investopedia.com/terms/k/kimchi-premium.asp

My Stake: Back claim (50 Cred)

My Argument/Evidence: I agree with Investopia that South Koreans don’t have that many options for high yield investments. Not many natural resources and their cultural export “K-pop” was banned 1.5 years ago in China due to a political conflict. Also, internet is super fast, most of the population uses smart phones constantly, and are used to stock e-trading. Even older people can go to brick and mortar crypt exchanges to open a cryptocurrency account. 2 of the most popular exchanges in Asia are Korean. Therefore, demand for technology and cryptocurrency investments is obvious.

I didn’t know there was so much complexity of issues around cryptocurrency in South Korea, and the unique historical, economic and political influences. Two major powers at work in crypto: greed (can also described as hype) and fear (shows itself as depression too) according to Santiment Content’s Medium article and CNN also talks about it. 1/5 of bitcoin transactions happen in South Korea.

January 15, 2019 by Laura Shin
Korea was one of the highest-volume trading regions in 2017. How has that changed in this crypto winter?

Dovey: The kimchee premium is due to no local supply (from miners) but lots of demand at the very beginning. That eventually balanced out thanks to the positive economics of arbitraging. The trading volume of Korean exchanges is said to be very inflated so I’m not sure what the real volume is currently. This is a commonly known thing when exchanges engage in wash trading a lot to get a higher rank. On Coinmarketcap, the biggest Korean exchange Bithumb is among the top two by reported volume but 200+ by adjusted volume. That says something.

Korea is a small country of 50 million, and Seoul itself makes up 25% of that (10 million). Their megacities are very dense which, in 2017, helped for information propagation. Koreans would simply go to offline meetups to learn about crypto or get investment advice from their neighbor. On the flip side, the penetration in a small pool is also faster, so we have seen major fatigue in the Korean market starting the first half of 2018.

Simon (founder of Hashed, the absolute leader in crypto investment of local Korea) drew this when I was in Korea last time and shared some insights. The Korea regulatory body has been fuzzy about crypto and has no guidelines, leaving much in a gray area there.

Unknown: There are many changes happening in Korea right now and will keep you guys updated about it.


#16

Claim: Google Ads blacklists the word “Ethereum” as a keyword in some countries

Category: Regulation

Source: https://cointelegraph.com/news/what-we-know-about-google-ads-allegedly-blacklisting-ethereum-as-a-keyword

My Stake: 50 Cred challenging

My Argument/Evidence: From the article, it claims that Google Adwords (the mechanism to create ads on Google) doesn’t allow for the word “ethereum” as a keyword in ads in Serbia.

  • Google Adwords has a policy that it doesn’t allow Trademarked words to be included in their keywords of an ad. (Source: Google Ads policy)
  • Searching the Trademarked database, Ethereum is in fact Trademarked (Source: US Trademark database)
  • The article states that ads in the United States can potentially include the word “ethereum.”
  • I went into Google Adwords (logged into a VPN in Serbia) and tried to create an ad campaign targeted with Serbia as the country with “ethereum” as the keyword. The results showed it was a valid keyword and gives the cost to run the campaign.
  • From what I’ve found I’m not sure if this claim is true or not since I didn’t pay to run the ad campaign to see it would follow through…

Anyone located in Serbia?


Welcome to TruStory!
#17

I have a few friends who work at Google AdWords. I will ask them if this is true.


#18

Claim: There are now Tezos development teams on 5 continents
Category: Tezos
Source: https://twitter.com/JacobArluck/status/1085027044998680577
My Stake: Backing (50 Cred)
Argument/Evidence: A thorough scour of the website does not reveal any mention of names of developers (which is weird isnt it) or locales. However, there are very active Twitter/Meetup communities across 5 continents that follow and retweet each other including the main Tezos page

South America: https://tezos.rio/
Europe: https://www.meetup.com/Tezos-UK/
Africa: https://twitter.com/xtzcotedivoire
Asia: https://twitter.com/TezosJapan
North America: https://twitter.com/TezosUSA


#19

are you backing it with 50 Cred or challenging it with 50 Cred?


#20

keep us posted. PS: are you backing it with 50 Cred or challenging it with 50 Cred?