Lessons in key-man risk from the QuadrigaCX disaster
By Chris Dannen
Feb 1, 2019
The founder of a Canadian cryptocurrency exchange has died, leaving his colleagues and heirs without access to his cold storage system. Companies generally prepare contingency plans for the death or disability of a key employee, sometimes by buying a special insurance policy. QuadrigaCX had nothing of the kind, and will go bankrupt. In a world of bearer assets, foresight is survival.
QuadrigaCX Owes Customers $190 Million, Court Filing Shows
"In a sworn affidavit filed Jan. 31 with the Nova Scotia Supreme Court, Jennifer Robertson, identified as the widow of QuadrigaCX founder Gerald Cotten, said the exchange owes its customers roughly $250 million CAD ($190 million) in both cryptocurrency and fiat. ... Cotten reportedly died of Crohn’s disease in Jaipur, India in early December 2018. The exchange announced his death earlier this month. A death certificate was included in the list of exhibits. The founder seemingly had sole control or knowledge of Quadriga’s cold storage solution. Robertson wrote that after his death, 'Quadriga’s inventory of cryptocurrency has become unavailable and some of it may be lost.'"
"The lesson for every development or research team watching looks pretty clear: more scammy ICOs for more money and a lot less work. Perhaps forcefully taking 20% of all rewards is the only way to get any contribution out of the mining industry. Are those the conclusions you want to impress on everyone in this sector? Because if greed feeding on itself is the only lesson, then this space truly deserves a really long and hard winter. A lot more creation is needed to reach escape velocity, and that won’t happen if everyone’s goal is just feeding off it."
- I send 100k sats with https://t.co/va7XSnFii0 to the first person I choose to trust that replies to this. - That person adds 10k sats and sends 110k to someone (Either from reply to a new tweet, or this thread)
Mapping out Blockstream
"As part of a new installment of The Block’s 'Mapping Out' series, we have compiled a graphical representation of Blockstream’s organization to help our readers explore and discover the people behind some of the largest and most influential firms in the space."
Facebook Hires Up Three of Its Biggest Privacy Critics
"'Hiring a few people doesn't change culture, especially in an organization that has become as large and sprawling as Facebook,' said O'Brien. 'I take this as a sign that Facebook is at the very least interested in exploring what change might look like.' There's a hope, also, that White, Cardozo, and Greene will not just help bolster Facebook's privacy cred but also open up helpful conversations between their former advocacy worlds and Facebook's leadership."
Spork: Probabilistic bitcoin soft-forks
"We should be able to point to the economic conditions for something to activate, and here's what it cost them to vote, and so on. So I am going to propose spork (sorta probably a fork), a mechanism for making these forks more incentive compatible. So we have a probabilistic block filter. One out of every some amount of blocks will activate based on this filter that I have written there. d > hash(hash(block)||"upgrade name"). The original PoW is in that hash. If you want to grind on that hash using hardware, the best you can do is normal bitcoin mining. And the nactivate after the above condition is met. Say I want to add CHECKBLOCKHASHVERIFY. It's going to give us replay protection, it allows us to invalidate transactions during a reorg, and it requires a mempool rewrite. It's going to take some engineering effort it's a little complex."
Asymmetric Cryptography In Blockchains
"Asymmetric cryptography, also known as public-key cryptography, is one of the key components of blockchain technology. This form of cryptography allows everyone to verify the integrity of transactions, protect funds from hackers and much more. But how does it work?"
Ethereum Core Dev Call #54: Waiting for ProgPoW
"In short, the discussion around ProgPoW centered on how to best move forward with deciding to implement or not. The indecisiveness continues to persist, as many developers feel inadequately qualified to make an informed decision either way, amidst a backdrop of high noise to low signaling data. Some developers feel more strongly that the decision needs to be made by them, given the purpose of why they meet in the first place – to make core development decisions! Quite the dilemma."
National Security Implications of Virtual Currency
"This report examines the feasibility for non-state actors, including terrorist and insurgent groups, to increase their political and/or economic power by deploying a virtual currency (VC) for use in regular economic transactions. A VC, such as Bitcoin, is a digital representation of value that can be transferred, stored, or traded electronically and that is neither issued by a central bank or public authority, nor necessarily attached to a fiat currency (dollars, euros, etc.), but is accepted by people as a means of payment."