Microsoft Wins US Blockchain Patent

PLUS: India's watchdog to use blockchain, DJ 3LAU to launch music investment platform |

What you need to know today in crypto and beyond  August 26, 2021 Sponsored by     Welcome to The Node.   If you were forwarded this newsletter and would like to receive it, sign up here.   Questions? Feedback? We'd love to hear from you! Simply reply to this email.   –Daniel Kuhn Today's must-reads Top Shelf EXCLUSIVE: Microsoft has been awarded a U.S. patent for software it says can help users develop blockchain applications more easily. The patent describes a ledger-independent system for helping users to create tokens, and for managing them across different networks, which, according to the patent, is currently "difficult and cumbersome" due to the lack of standardization across different blockchains.   WATCHING VIA BLOCKCHAIN: India's securities watchdog plans to lean heavily on distributed ledger technology for the monitoring and recording of financial instruments, beginning next year. The Securities and Exchange Board of India (SEBI) announced Wednesday its intention to roll out a system for "security and covenant monitoring" for non-convertible debentures, which marks a significant step for the use case of blockchain within India's financial ecosystem.   ROYAL: Justin "3LAU" Blau – the DJ with a heavy crypto side hustle – is launching a music investments platform that aims to give listeners a piece of the wealth generated by songs. Called Royal, the music tokenization platform slices up song royalty rights into crypto tokens that anyone can buy and trade. The platform already raised $16 million in a seed round.   –Helene Braun A message from Nexo When it comes to buying, borrowing or earning on your crypto, you won't find an easier, safer way to do it than Nexo.   And right now, with its Referral Program you can earn $10 worth of bitcoin for each friend you refer. And the best part – your referral gets $10 in BTC, too.   You can invite up to 100 friends – so you can get as much as $1,000 in bitcoin by copy-pasting a few links. And you can further bump that amount by earning up to 8% interest p.a. on your bitcoin, paid out daily.   Now is the time to unlock the full power of your crypto.   Join Nexo and start earning free BTC with your friends. Overheard on CoinDesk TV Soundbite "In 10-20 years from now, let's fight over things like the financial institutions do today. Today we need to be working together."   –Vast Bank CEO Brad Scrivner, on CoinDesk TV's "First Mover." What others are writing... Off-Chain Signals The real victims of mass crypto hacks that keep happening (BBC)  Bitcoin ATM operators set up association to counter money laundering (Cointelegraph)  –H.B. A Message from BlockBank Looking for a crypto wallet with DeFi and CeFi coupled with banking and debit cards? Look no further, V2 of BlockBank's super application launches this fall, offering access to:   Custodial and non-custodial wallets Digital bank accounts Physical & Virtual Debit cards Robo Advisor Access to dApp BlockBank has already obtained licenses for Estonian virtual currency service provider, and Australian digital currency exchange and payment service provider. Stay updated and subscribe to the Beta testing.   Putting the news in perspective The Takeaway A Non-Salty Journalist Remembers His First Bitcoin I still remember my first bitcoin.   Well, around half a bitcoin. It was early 2014, and I was at Bitcoin Miami reporting on, among other things, the announcement of Ethereum. We were in the midst of a raging bull market, and BTC had recently skyrocketed to over $600 – unthinkable heights! I split a hotel room and my roommate sent me $250 worth of BTC to cover his share.   To this day it's still the most bitcoin I've ever owned. It would be worth around $25,000 right now, for an annualized 990% rate of return.   Unfortunately, I had to sell that bitcoin almost immediately. Woe is me.   I had to sell because I was in Miami doing some of my first reporting for Fortune Magazine. Fortune, like most traditional financial and business news outlets, prohibits its writers from owning financial assets anywhere adjacent to the beats they cover. The idea is that owning an asset will inevitably skew your coverage of it to be more positive, or lead you to write negatively about competitors. (I couldn't buy the Ethereum presale either, big RIP.)   Policies like this have recently come up for scrutiny following a tweet thread from investor Lyn Alden. Alden's points are fairly nuanced. She's not arguing against no-conflict policies in general: "It's understandable that you can't own some minor altcoin that you could conceivably move the price of with your words, as a journalist."   But Alden argues that journalistic no-conflict policies shouldn't apply to bitcoin specifically because "People who write about money and finance should be able to own money. Bitcoin is money, in a global sense."   There's some déjà vu here for us old-timers, because this is essentially the same argument that was being made quite frequently seven years ago: "Bitcoin is money. Journalists own dollars, right? Doesn't that bias them towards fiat?"   That argument is vastly more defensible today than it was seven years ago. "Bitcoin is a $900 billion market cap asset," as Alden writes. "An individual piece of writing, even at [The Wall Street Journal] or Bloomberg, won't materially influence it now."   That's correct as far as it goes, though much the same could be said about Tesla or, as Willamette University law professor Rohan Grey points out, Purdue Pharma. Ultimately, I don't think it's a great argument because we're not just talking about individual actors here, but an entire industry. Maybe one biased story by one journalist holding bitcoin wouldn't skew the discourse, but what about all of them at once?   A much more important argument for allowing journalists to own at least a little bitcoin (as a treat) is that they need exposure to how it works, at both a technological and market level. Someone reporting about Instagram without having used it would be irresponsible, and the same goes for crypto: If you've never used MetaMask, I'm a bit less interested in your theories about the future of Ethereum.   Seeing that first $250 worth of bitcoin arriving in the DOS-text wallet on my clunky 2012 ThinkPad has enhanced my reporting on crypto every single day since. And during the brief periods when I've been out of journalism and held it, I was motivated to watch markets and learn their dynamics. (I also bought at $3,000 in 2019 but had to sell at around $10,000 when I returned to Fortune. Rekt again!)   Alden also makes a further point that I frankly find more troubling: "Not owning some of the best-performing assets, like bitcoin, can also affect [journalistic] bias." I'm sure this is an attractive notion for investors who see journalists writing critical things about bitcoin and crypto – they're just salty that they're not getting rich like me!   That's pretty worrying logic, and I think not actually helpful for smart investors. It implies that any critical treatment of a successful asset by a non-holder can be dismissed as "salt," which could amount to putting on blinders to real concerns. We all know bubbles and manias exist, and if you're not even willing to evaluate negative signals you're not doing good risk management.   And that's the main reason you as a reader benefit from no-conflict rules: It ensures the information you're getting is motivated by the writer's professional incentive to find facts, rather than their personal incentives to pump their bags.   More to the point, I think the "salt" thesis reflects a misunderstanding of what kind of people are journalists. As a group we're certainly more cautious and risk averse than bleeding-edge tech investors – it's pretty inherent to our training and mindset. Good journalists, at least, ask a lot of questions and think slowly and carefully.   The reward is that we get to spend our time being curious. Leaving aside institutional concerns, plenty of business journalists would be glad to be entirely detached from the industries and markets they're covering, just so they can ensure their curiosity is unconstrained. We've mostly reconciled ourselves to the idea that we're not going to make tech-investor type money, and see it as a fair trade-off.   Now, as you may know, CoinDesk doesn't have the same kinds of rules as Fortune or Bloomberg: Journalists here can own crypto, though with strict rules about disclosure and timing. Personally, I own less than 2% of my net worth in bitcoin and ETH, and small amounts of polkadot and solana tokens. (I also own a bunch of Gods Unchained cards that I bought in 2018 for ETH that would be worth about five grand now (argh), and a herring NFT of incalculable value.)   One important thing to note about CoinDesk's policy is that, unlike Fortune or Bloomberg, we're not a general interest publication. As big as our ambitions are (and they're big), we're still effectively a trade publication for the cryptocurrency and blockchain industry. So nobody in their right mind would come work for CoinDesk if they didn't already have at least some degree of faith that this industry matters and will continue to matter. And while we're proud to offer a diversity of critical opinion, basic media literacy should tell you you're not going to get "this entire industry is fake"-type takes here. (Try the Financial Times.)   Note, crucially, that believing something will matter is different from believing it is good. The fact that I own bitcoin doesn't mean I think it fixes all the world's problems. I've been thinking about technology long enough to know that it will have weird, complex and sometimes negative implications. But I feel secure reporting on those problems because I believe that bitcoin, like Thanos, is inevitable. The same fascination that drove me to write about it at $500 is basically why I work at CoinDesk now, and why I'm still buying.   One final personal note that might be enlightening. Back in 2014, I barely had two pennies to rub together: I had just left academia and was freelancing to make ends meet while I figured out my next move. A $100 prize from winning a poetry contest helped me make rent one month. So even if I had been able to invest, I doubt I could have pulled together more than about $2,000 to put into bitcoin at the time. Let's say that would have turned into about $200,000 by now. Not bad!   But instead, learning and writing about bitcoin wound up being my gateway to an honest-to-god career – an almost unimaginably fun and creative one, and relatively lucrative to boot. After that trip to Miami, I covered crypto for Fortune regularly, eventually becoming a full-time staffer there before landing my latest gig at CoinDesk.   The upshot is that in the years since I sold that sweet, sweet $600 bitcoin, I've earned many times those lost investment returns by writing about finance and technology, an activity which to me barely feels like work. Looking into the future, I doubt I'll ever have a hard time finding stimulating, fun and well-paid employment again.   If I had to miss out on a few years of 1,000% gains to get where I am now, I can't say I'm salty about it.   –David Z. Morris Introducing Crypto for Advisors, a weekly newsletter built specifically for financial advisors (FAs) and registered investment advisors (RIAs).   Crypto for Advisors, delivered every Thursday, is designed to inform and educate financial professionals who seek to incorporate this rapidly moving asset class into their work. Subscribe today. The Chaser... The Node A newsletter from CoinDesk See Previous Editions Copyright © 2021 CoinDesk, All rights reserved.  250 Park Avenue South New York, NY 10003, USA You can manage your preferences here or unsubscribe from all CoinDesk email.