Tag Archives: blockchain

Why the Netflix Model is the Future for Enterprise Blockchain

Why the Netflix Model
is the Future for Enterprise Blockchain

What's a blockchain?

Why not use a distributed database? What's a smart contract? What the hell is chaincode? Among blockchain industry participants, you'll get different answers and different views to all of these questions (and many more). Almost weekly, we read new blockchain white papers proposing new unique functionalities to solve a problem in a slightly better or different way. Of course, this amount of experimentation and research can only be good for the long-term growth and maturity of our industry, but it’s also made it extremely complicated for potential buyers to make determinations about what fits their needs best.

Although the term "blockchain" has generally been used as the umbrella name for a very broad collection of new technologies, it seems to me that our industry has not yet gone through the necessary objective scrutiny to separate the good, from the bad (and the ugly). Right or wrong, there seem to be some common themes among enterprise companies that became apparent over the course of 2016.

This is not a comprehensive list, but a few worth highlighting:

  1. Companies are looking to build using permissioned blockchain networks (whether as an interim solution or a long-term outcome)
  2. In many contexts, it will be important to maintain transaction privacy
  3. Current transaction performance on the public bitcoin and ethereum networks is insufficient
  4. Smart contracts provide an elegant framework to automate shared business processes.

Ethereum examined

In considering these challenges and how to solve them, a large number of companies have migrated their efforts to ethereum.It's by no means a perfect solution, but arguably because of its flexibility and because of the organic community of developers surrounding it, it remains unparalleled in the industry.

Rather than look at ethereum as one network, however, many consider it as a template to model, improve, customize and implement in difference contexts. Ethereum technology, therefore, has found its way into multiple networks serving multiple purposes, although imperfectly. To better achieve this outcome, I would argue that ethereum needs some rearchitecting to allow for multiple network implementations. In its current form, it was designed (and continues to be improved upon) as a protocol to power a single global network.

Incompatibility

Having come to the same realization, a number of companies have created versions of ethereum that fit their needs – in many cases with band-aid fixes that can only be described as temporary and imperfect. Among those companies, there are both startups and large organizations, most of which are primarily interested in one vertical problem set that impacts their industry and their business.

This has led to unnecessary fragmentation and incompatible modifications being made to the ethereum protocol in all these various versions. Contrary to the initial vision of ethereum (of being a general purpose protocol), many of these implementations are being built as single-purpose solutions to power specific industry applications.

As companies get closer to production, this problem is becoming more evident to those involved. Drawing parallels from the web services ('cloud') industry, I’m convinced that we’ll see a new trend this year. Rather than end users building their own customized infrastructure, and essentially managing their "full stack", a small number of providers will focus on offering modular infrastructure that can be leveraged with little effort by the companies solving challenges at the application layer.

Action ahead

This reorganization of the industry (infrastructure vs app) will allow for specialization and better long-term improvements to the underlying software while maintaining standards of compatibility. In the same way that Netflix is built using Amazon Web Services, mature companies emerging in this space will partner with infrastructure providers to scale their businesses more efficiently.

Ideally, as we work towards this model, the resulting infrastructure frameworks will allow for deployments that are fully compatible with 'public ethereum', while also enabling deployments that include custom functionalities required by the user.One of the great benefits I foresee from this model is that new proposed ideas, which today end up as competing protocols, could become alternative modules compatible with a standardized framework. This will make it easier for companies to adopt improvements without having to rebuild from scratch. Luckily, this isn't wishful thinking. Some of us are already on our way to making this real.

Chuck Reynolds
Contributor

Markethive

The peso has done something shocking since Trump took office

    

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The peso has done something shocking
since Trump took office

   

Wax figures of U.S. President Donald Trump (L) and Mexico's President Enrique Pena Nieto are seen at the wax museum in Mexico City, Mexico. Reuters/Henry Romero

The Mexican peso has done something shocking since President Donald Trump took on office January 20th. It's actually stronger versus the US dollar. The Mexican peso hit a one-month high of 20.6601 per dollar on Wednesday morning before trimming some of its gains. The currency trades up 0.4% at 20.7520 per dollar as of 8:22 a.m ET.

Mexico's currency has had a wild start to 2017. 

It fell about 6% over the first three weeks of the year as traders priced in what a Trump presidency could mean for the currency as he railed against Mexico throughout his campaign. But then the fireworks began as Trump took office and the peso's fortunes began to turn around:

  • Last Thursday Trump tweeted, "The U.S. has a 60 billion dollar trade deficit with Mexico. It has been a one-sided deal from the beginning of NAFTA with massive numbers of jobs and companies lost. If Mexico is unwilling to pay for the badly needed wall, then it would be better to cancel the upcoming meeting."
  • Mexican President Enrique Peña Nieto pushed back, stating that Mexico would not pay for the border wall that Trump has promised to build and responded with his own tweet, "This morning we have informed the White House that I will not attend the meeting scheduled for next Tuesday with the @POTUS."
  • The Trump team responded by suggesting a 20% border tax could be placed on all US imports coming from Mexico, and later said that tax could be placed on all imports. 
  • On Friday, Trump continued his assault on the US' neighbor to the south, tweeting, "Mexico has taken advantage of the U.S. for long enough. Massive trade deficits & little help on the very weak border must change, NOW!" 
  • But cooler heads prevailed and Peña Nieto and Trump held an hour-long phone call to try and work out their differences. While the outcome of the call was not made public, it's a sign that the two sides are trying to work things out. 

Interestingly, the peso has actually strengthened by about 6% since Trump was inaugurated on January 20th, and has wiped away all of its losses for the year. However, the currency is still down about 13% since Trump won the election. 

Chuck Reynolds
Contributor

 

Markethive

Bitcoin’s Price is Flirting With $1,000

Bitcoin's Price is Flirting With $1,000

The price of bitcoin is inching closer to $1,000 once again.

Prices hit a high of $994.79 during morning trading, according to the CoinDesk Bitcoin Price Index (BPI), after opening at an average of $977.52. Prices haven’t exceeded $1,000 since 6th January, having crossed that benchmark on the first day of 2017.

The price of bitcoin is currently at an average of $993.04.

CNY-denominated markets are up more than 9%, reaching a high of ¥6,890.56. Those markets are averaging ¥6,865.50, BPI data shows, representing an increase of roughly 9.3%. Prices have been rising since earlier this week, a move that came amidst a shift in the exchange ecosystem amongst toward markets that don’t charge trading fees. Observers are split, however, on the long-term trajectory of these trends.

Bitcoin is back above $1,000

Bitcoin is is back above $1,000 for the first time since January 5. The cryptocurrency was higher by 1.5% at $1,000.10 a coin as of 11:39 a.m. ET.

It's been a wild year for bitcoin. It began 2017 with a 20% rally during the first five days of the year before crashing 35% on concerns of a crackdown on trading in China.

Thursday's gains have extended bitcoin's winning streak to a sixth straight session as trade appears to be benefitting from uncertainty surrounding Donald Trump's presidency. The cryptocurrency has gained nearly 10% since Trump was inaugurated on January 20.

Chuck Reynolds
Contributor

 

Markethive

‘People prefer cash’ and that’s good news for bitcoin

‘People prefer cash’
and that’s good news for bitcoin

bitcoins

“Sorry, Bitcoin: Cash Is Still King Around the World.”

So says an article that Time published in its money section last month. The article is based on research published by the International Journal of Central Banking (IJCB), which showed consumers around the world still prefer cash to electronic payment methods. According to the IJCB report:

“Cash is still used extensively — particularly for low-value transactions. In some European countries such as Austria and Germany, cash even dominates consumer payment choices for all transaction values.”

 

While the IJCB report doesn’t mention bitcoin, the author of the Time article interpreted the data as bad news for bitcoin. However, a careful read of the report discloses the opposite: The fact that people prefer cash to electronic payment methods is actually good news for bitcoin.

High demand

Bitcoin is a young form of payment. It isn’t realistic to expect it to beat cash in less than only a decade. Bitcoin adoption is doing very well, though; especially when we take into account that it isn’t a company and thus doesn’t have a marketing department, let alone an aggressive one like major credit card companies can afford.

Adoption is actually overtaking the network’s technical capacity, leading to the bitcoin scaling debate. The community is experiencing pressure to scale the network due to an overflow of transactions, which means the number of people using bitcoin is growing. Bitcoin or something similar is actually a perfect currency for the future, according to the IJCB report. We can arrive at this conclusion through a keen reading of the reasons the report gives for consumers choosing cash over electronic payment methods.

Privacy and security

One reason the report gives for a consumer preference for cash is a desire for anonymity and security. It states:

Anonymity and security concerns are sometimes cited as influencing people’s payment behavior. However, the level of anonymity and security people require when making payments is difficult to measure empirically.”

Bitcoin and other cryptocurrencies afford users the ability to spend money online without disclosing their identity. Indeed, bitcoin brings the properties of cash into the online setting. Electronic payments demand you identify yourself before sending or receiving money. That is not the case with either cash or bitcoin.

Refuge from financial crisis

The report also says consumers prefer cash over electronic payment methods because they don’t trust financial institutions, especially when they are the cause of economic crisis: “A more relevant explanation for cash preference arises if a country has a history of banking crisis, which often coincides with high inflation and may affect trust in banks.

Bitcoin offers its users an opportunity to hold and spend their money apart from financial and banking institutions. While the report states this is a problem of the developing world, the US housing crisis of 2008 and the Greek government debt crisis of 2014 say otherwise. With each new banking crisis, consumers become more wary of commercial bank payment methods.

Already there are signs that consumers consider bitcoin an option when there is a financial crisis. During the Greek financial crisis, the price of bitcoin shot up when there was a huge demand for it by consumers who wanted to safeguard their financial value.

Cash online

The report also showed that in all the countries surveyed, older generations use cash the most. It states that preference for cash grows with age. From the report:

Regarding age, we find that persons older than thirty-six use significantly more cash than persons younger than thirty-five. Also, the results provide support for a certain habit persistence in some countries, where cash use increases homogeneously with age: people aged sixty and older are more likely to use cash than people between the ages of thirty-six and fifty-nine.”

As time progresses, an electronic payment method that mimics cash will become more attractive. With increasing Internet access and more people and businesses going online, an electronic payment method that mimics cash may be the only option for those who prefer the properties of cash. And this is where bitcoin comes in.

Rupert Hackett is general manager of Bitcoin.com.au and BuyaBitcoin.com.au. He specializes in the digital currency and digital payment space, writes for multiple bitcoin and tech websites, and is an acting Board Director for the Australian Digital Currency Commerce Association (ADCCA).

Bitcoin is busting out

Attendants pose with a bitcoin sign during the opening of Hong Kong's first bitcoin retail store. Reuters/Bobby Yip

Bitcoin is busting out of its range that had been in place for the middle part of January. The cryptocurrency spent the past two weeks trapped at the $880 to $920 resistance level but has finally broken through. 

Bitcoin rallied 3.7% on Tuesday as the Trump team exchanged barbs with German Chancellor Angela Merkel over the weakness of the euro, closing the day near $955 a coin. Tuesday's gains have carried over into Wednesday's session with the cryptocurrency up close to 1% near $972. 

Bitcoin has had a wild start to 2017 after rallying more than 120% in 2016 to become the top performing currency for a second straight year. It rallied more than 20% in the opening says of the year, crossing the $1,000 level for the first time since November 2013 before tumbling more than 35% amid worries that China was going to crack down on trading. Recently, the cryptocurrency has shrugged off the news that China's three largest bitcoin exchanges will begin charging a flat fee of 0.2% for each transaction. 

Chuck Reynolds
Contributor

Markethive

Russia Considers Allowing Use of Cryptocurrency in the Unbanked Region of Crimea

Russia Considers Allowing Use of Cryptocurrency
in the Unbanked Region of Crimea

 

Russian Internet ombudsman Dmitry Marinichev suggested allowing the use of cryptocurrencies to residents of Crimea. In his opinion, legal entities and individuals registered in Crimea should be allowed to use cryptocurrency wallets and make transactions with digital currencies. Elaborating on his proposal, Marinichev suggested the opening of cryptocurrency exchanges, as he believes it will help attracting new investments to the region. He referred to the example of Hong Kong that has managed to create one of the biggest Bitcoin exchanges.

An important precondition for this initiative is the creation of a free economic zone within the peninsula.

Marinichev said at last week’s Conference on Regulation of Cryptocurrencies in Russia:

“Today Crimea is an exclusive economic zone, which makes it possible to start with the opening of cryptocurrency exchanges operating there absolutely legally. As a result, we will see the actual legalization of cryptocurrencies.”

Russia’s changing attitudes towards cryptocurrency

Elina Sidorenko, the Head of the Working Group for the Assessment of Risks of the Use of Cryptocurrencies at the State Duma of the Russian Federation, explained that recent legislation has addressed some of the most pressing issues in banking in Crimea. Bringing to the table cryptocurrency-based payment instruments and using it for international transactions was discussed among other initiatives to improve the banking climate on the peninsula. Eventually, however, this idea had died.

At the moment the status of digital currencies is not defined in Russian legislation, although in the last few years we have seen several attempts to put cryptocurrency into a legally defined framework. In December 2016, Alexey Moiseev, Deputy Finance Minister of the Russian Federation, announced that the Ministry of Finance is expecting to pass a law introducing a ban on exchange operations with Bitcoins and national currency not earlier than in Autumn 2017.

Meanwhile, some of the most influential banking industry players believe that Blockchain technology laying in the core of digital currencies is extremely valuable for the reshaping of a global financial system. For instance, experts in Sberbank, which has been actively testing technology during the last year, believe that by 2018 we will see a wider scope of application of Blockchain in the financial industry.

Banking the Unbanked with Bitcoin

It is often suggested that cryptocurrencies have significant potential to connect areas and people who have been neglected by traditional forms of banking to the global financial ecosystem. There is a number of huge developing markets, which still remain relatively untouched by modern banking services, however, they demonstrate the rapidly growing Internet infrastructures.

Alex Fork, CEO at Humaniq, the new-generation platform that makes basic financial instruments accessible to unbanked communities, shared his opinion:

“Unbanked regions usually consist of a financially poor population. The most important thing is to provide them with a new technology available absolutely free of charge. It is essential to deliver the service to the customer in such a way that they don't experience any difficulties.”

Everyone wins with Bitcoin

At the same time, we see that governments are extremely careful when it comes to regulating cryptocurrencies. Perhaps piloting projects in unbanked regions can create an extraordinary win-win situation. Individuals and companies who have been failed by traditional banking will be empowered with a new financial instrument, while regulators will get a perfect opportunity to experiment and innovate and finally make up their minds about how to treat this bizarre creation called Bitcoin.

What else can create a greater chance for the adoption of cryptocurrencies?

Alex Fork concludes:

“Of course, apprehension of governments regarding cryptocurrency is not only the innovation’s fear. The idea of testing the project within a small region of Russia is good. At least there will be an opportunity to practice and to gain some experience.”

Chuck Reynolds
Contributor

Markethive

SEO – Optimized Anchor

SEO –
Optimized Anchor

             

Use descriptive anchor text for all your text links. Most search engines consider anchor text of incoming links when ranking pages. Here is an example of anchor:

<a href="otherpage.htm" title="Anchor Title">Anchor Text</a>

Listed below are some of the important points to note about anchors:

  • The Anchor Title plays a very important role and is seen by most of the search engines. The anchor title should have appropriate keywords. Anchor title helps the site visitors using a balloon and displaying written text.

  • The Anchor Text is another important part, which should be selected very carefully because this text is used not only for search engines but also for navigation purpose. You should try to use the best keywords in your anchor text.

  • The otherpage.htm is the link to another web page. This link could be to an external site. Here, you need to ensure that the linked page does exist; otherwise, it is called a broken link, which gives a bad impression to search engines as well as to site visitors.

Another example of an anchor could be as follows:

<a href="otherpage.htm" title="Anchor Title">
   <img src="image.gif" alt="keywords" />
</a>

In this case, Anchor Text has been replaced by an image. So, while using an image in place of an anchor text, it should be checked that you have put alt tag properly. An image alt tag should have appropriate keywords.

Content is the King

Content basically includes what you see on the site: the text, graphics, and even links to other websites. You should not use excessive graphics because they are not Search Engine Friendly plus heavy graphics normally put the users out when they get downloaded, especially over a slow network. Thousands of articles, books, and forum entries are available on how to make your website search engine friendly, but ultimately, one rule stands above the rest: Unique, high-quality, unduplicated content is the king.

Superior the quality of your content, the higher the ranking you achieve, larger the traffic you gain and greater the popularity of your website. Search engines prefer good quality sites in their index and search results. Relevant, fresh, and timely content is crucial in attracting visitors to your website. It helps you both draw traffic from search engines and create audience loyalty.

Unique, High-Quality Content

When people visit a website for information, they want your unique spin on a topic. How is your material or content unique? Is that uniqueness obvious, and easy to find and to understand? Visitors want unique, high-quality site content. It is not only your home page content but also all the linked pages should have useful and easy-to-understand content.

Now-a-days, search engines have become very smart and they are able to understand complete grammar and complete phrase. Hence while ranking a page against other, the content available on a page matters. Sites that are duplicated, syndicated, or free content, are get given red flags by the search engines.

SEO Content Writing (Copy Writing)

SEO Content Writing (also referred as SEO Copy writing), involves the process of integrating keywords and informative phrases which make up the actual content of your website.

While writing your web page content, the following tips may help you in keeping it better than others.

  • The content should be directed in the specified target audience.

  • Keyword density is strictly adhered as per search engine guidelines.

  • Titles should always be eye-catching, compelling your visitors to read on and want to know what you offer in your website.

  • Do not use confusing, ambiguous, and complex language. Use small statements to make your content more understandable.

  • Keep your web pages short.

  • Organize and distribute the content on the web pages.

  • Divide your web page content also into short paragraphs.

Other Advantages of Having Great Content

It is not only SEO you need to think about. Many factors contribute to make your site popular.

  • If your site is having something really unique, then people like to suggest it to their friends.

  • Other webmasters like to create a link in your site on their sites.

  • Your site visitors start trusting on your site and they look forward to the next content update and keep coming again and again.

  • Although you are listed out by a search engine, a but net surfer will click only that page whose content snippet looks unique and interesting.

Conclusion

Creating, editing, and promoting unique high-quality content is difficult and time-consuming. But in the end, the golden rule of SEO is that Content is the King. It is not because of a search engine, but it is for your site visitors. A page that is read by people is better than a page that is read by bots.

So, write your content after a serious thought. Keep your title, keywords, link text, meta tags up-to-date, unique, and interesting.

Chuck Reynolds
Contributor

Markethive

SEO What do know about Title Optimization

SEO
What do know about "Title Optimization"

                            

An HTML TITLE tag is put inside the head tag. The page title (not to be confused with the heading for a page) is what is displayed in the title bar of your browser window, and is also what is displayed when you bookmark a page or add it to your browser Favorites. This is the one place on a web page where your keywords MUST be present. Correct use of keywords in the title of every page of your website is extremely important to Google, particularly for the homepage. If you do nothing else to optimize your site, remember to do this!

Here are some considerations while designing the title of a web page:

  • The title shouldn't consist of more than about 9 words or 60 characters.

  • Use keywords at the very beginning of the title.

  • Do not include your company name in the title unless your company name is very well known.

Improper or nonexistent use of titles in web pages keeps more websites out of top rankings on Google than any other factor except perhaps for a lack of relevant content on a page or a lack of quality links from other websites that point to your site.

Best Practices for Creating Titles

Here are some best practices you should follow for creating titles on pages:

  • Each page should have a unique title.

  • If practical, try to include your Primary Keyword Phrase in every title of every page.

  • Begin the title of your home page with your Primary Keyword Phrase, followed by your best Secondary Keyword Phrases.

  • Use more specific variations to your Primary Keyword Phrase on your specific product, service, or content pages.

  • If you must include your company name, put it at the end of the title.

  • Use the best form, plural or singular, for your keywords based on what WordTracker says is searched on more often.

  • Do not overdo it – do not repeat your keywords more than 2 to 3 times in the title.

  • Make sure the <title> tag is the first element in the <head> section of your page – this makes it easier for Google to find the page.

Chuck Reynolds
Contributor

Markethive

SEO – Optimized Metatags

SEO – Optimized Metatags

Some search engines may display the meta description as a part of the search results, but the meta keyword tags should not appear in search results. The general consensus among SEO experts is that metatags are dead. Even so, many of these same experts continue to use metatags in their own sites. For Google, adding the description meta tag does not result in a boost in the Search Engine Results Pages (SERPs), but the description might be used for the description for your SERP listings in Google. Yahoo! says, they use the Keyword Meta Tag when it ranks a page. Hence it makes sense to add one for Yahoo! and any other minor search engines that still use.

What Do the Metatags Look Like?

You can add the following in the head section of the web page:

<meta name="keywords" 
         content="KEYWORD1 KEYWORD2 KEYPHRASE1 etc. 
         about 30 to 40 unique words">

<meta name="description" 
         content="An accurate, keyword-rich description 
         about 150 characters">

Meta Description Tag Tips

Important tips for good Meta description tags:

  • Use keywords in your meta description tag.

  • Try not to repeat the words overly often, but try to use multiple syntaxes of your key words.

  • There should not be more than 150 characters in a description metatag of a single web page.

  • Use a different meta description tag for each page, as each page is different and stands a better chance of being found if you place a good title and description on it.

Meta Keywords Tag Tips

Please refer to the previous chapter for identifying good keywords. Use the following tips for preparing good meta keywords tags.

  • Use synonyms.
  • Use unique keywords.
  • No need to repeat any given phrase.
  • You can repeat a word any number of time, as long as each time it is part of a different phrase.

Robots Meta Tag

The important metatag that you may need sometime is the Robots Metatag which looks like this:

<meta name="robots" content="noindex,nofollow">

Using the above metatag, you can tell a spider or a robot that you do not want some of your pages indexed, or that you do not want your links followed.

Chuck Reynolds
Contributor

Markethive

SEO – Optimized Keywords

SEO – Optimized Keywords

    

A keyword is a term that is used to match with the query a person enters into a search engine to find specific information. Most people enter search phrases that consist of two to five words. Such phrases may be called search phrases, keyword phrases, query phrases, or just keywords. Good keyword phrases are specific and descriptive.

The following concepts related to keywords, help in optimizing the keywords on a web page.

Keyword Frequency

This is calculated as how often does a keyword appear in a website title or description. You do not want to go overboard with frequency, however, since on some engines if you repeat a word too many times, you are be penalized for "spamming" or keyword stuffing.

In general though, repeat your keyword in the document as many times as you can get away with, and up to 3-7 times in your list of metatags.

Keyword Weight

It refers to the number of keywords appearing on your web page compared to the total number of words appearing on that same page. Some search engines consider this while determining the rank of your website for a particular keyword search. One technique that often works well is to create some smaller pages, generally just a paragraph long that emphasizes a particular keyword. By keeping the overall number of words to a minimum, you can increase the "weight" of the keyword you are emphasizing.

Keyword Proximity

It refers to the placement of keywords on a web page in relation to each other or, in some cases, in relation to other words with a similar meaning as the queried keyword. For search engines, that grade a keyword match by keyword proximity, the connected phrase home loans will outrank a citation that mentions home mortgage loans assuming that you are searching only for the phrase "home loans".

Keyword Prominence

It is a measure of how early or high up on a page, the keywords are found. Having keywords in the first heading and in the first paragraph (first 20 words or so) on a page are best.

Keyword Placement

Where your keywords are placed on a page is very important. For example, in most engines, placing the keywords in the Title of the page, or in the Heading tags will give it more relevance. On some engines, placing keywords in the link text, the part that is underlined on the screen in a browser, can add more relevancy to those words.

Best Places to Put Keywords

Here is a list of places where you should try to use your main keywords.

  • Keywords in the <title> tag(s).
  • Keywords in the <meta name="description">.
  • Keywords in the <meta name="keyword">.
  • Keywords in <h1> or other headline tags.
  • Keywords in the <a href="http://yourcompany.com">keywords</a> link tags.
  • Keywords in the body copy.
  • Keywords in alt tags.
  • Keywords in <!– insert comments here> comments tags.
  • Keywords in the URL or website address.

Finding Keywords

There are many different ways to find keywords for your website. Some good keyword ideas are:

  • The potential words, people would use to find your product or service.

  • The problems that your prospective customers may try to solve with your product or service.

  • Keyword tags on competitor's websites.

  • Visible page copy on competitor's websites.

  • Related search suggestions on top search engines.

  • Using an online tool such as Google Keyword Tool

  • By analyzing your website carefully and finding out proper keywords. This task can be done by expert SEO copywriters.

  • Pay attention to stemming for your keywords – particularly to what the root word is and what Google considers to be a match for that word when optimizing pages over time.

  • You can do brainstorming to identify correct keywords for your site.

What is Word Stemming?

Google uses a feature called word stemming that allows all forms of the word – singular, plural, verb form as well as similar words to be returned for a given search query. So if someone types in "house plans", not only the pages that are optimized for that phrase but the pages that contain all variations of that phrase are returned. For example, "house plan", "house planning", "house planner".

Hope you have some understanding on keywords and you also know how to identify them and where to use them. The next chapter explains how to optimize metatags for better results.

Chuck Reynolds
Contributor

Markethive

Former Federal Reserve Regulator is Afraid Bitcoin Could Destroy Central Banking

Former Federal Reserve Regulator
is Afraid Bitcoin Could Destroy Central Banking

 

NEW YORK (InsideBitcoins) — Previously, we covered the first nine points made by former Federal Reserve Bank Examiner Mark T. Williams in his recent presentation at the World Bank Conference, Virtual Currencies – Bitcoin Risk. Point ten was much longer and discussed the idea of bitcoin removing power from central banks, so it rightly deserved its own full article.

The final point made by Williams in his presentation discussed bitcoin’s sovereign attack risk. In his first bullet point, Williams noted:

“If adopted in its current raw form, bitcoin has the potential to undermine the longstanding bond between sovereign and its currency.”

This could be the most ironic statement found in the entire presentation because the other points were all used to explain why the risks involved with bitcoin will eventually lead to its downfall. In this final point, it seems that Williams is open to the idea of bitcoin becoming so prevalent throughout society that central banks will lose the power to control monetary policy.

Central banks and economic stability

The second bullet point in this section talks about how governments and central banks are needed to provide economic stability for their citizens. Venezuelans and Argentines will have to hold back a mixture of laughter and anger as they read the following statement from Williams:

“Governments exercise a monopoly power on currency creation with the understanding that doing so will provide its citizens with a greater level of economic stability.”

Williams seems to be ignoring the fact that a government’s ability to stabilize the economy depends on a level of perfect execution from the central bank that is simply unattainable. Whether you’re talking about the United States or Zimbabwe, the idea that central bank regulators are economic monks that are immune from corruption and error is laughable. We’re only five years into the bitcoin experiment, and this new digital currency paradigm is already competing favorably with certain central banks around the world.

Who controls the bitcoin monetary base?

Williams also seems to be concerned with how bitcoin manages its own monetary base in a decentralized manner. He notes that controlling the monetary base is “an immense power and responsibility” that is put into the hands of “those who create the algorithm, protocol, manage the transactional ledger and mine virtual currencies.”

First off, it should be noted that the above system may be preferred over what’s currently going on in places like Argentina and Venezuela. Secondly, Williams is correct in stating that the miners have a large amount of authority when it comes to whether or not bitcoin’s monetary policy could be changed in the future. One could even imagine a scenario where the mining community agrees to create more bitcoins due to the fact that transaction fees have not risen to compensate for the drop in block rewards; however, the miners also need to keep the economic majority in mind.

It’s important to remember that, in a world of competing cryptocurrencies, the controllers of a currency’s monetary policy are competing with other currencies available on the market. A country experiencing hyperinflation may turn to bitcoin, gold, or US dollars, and a cryptocurrency that makes a highly-inflationary change to its monetary policy may find itself losing out to other cryptocurrencies with monetary policies that are more advantageous for its users.

Deflation is scary

In another bullet point, Williams points out that bitcoin’s current monetary policy is inherently deflationary over the long term. This is a common point made by bitcoin critics, although they never seem to get into the details of why deflation is bad. There are many arguments to the contrary, including the deflationary period in the late 19th century. This was one of the largest periods of real growth in human history that also happened to coincide with a mostly deflationary monetary policy. As A.E. Musson noted in his “The Great Depression in Britain, 1873-1896: a Reappraisal”:

“Prices certainly fell, but almost every other index of economic activity – output of coal and pig iron, tonnage of ships built, consumption of raw wool and cotton, import and export figures, shipping entries and clearances, railway freight clearances, joint-stock company formations, trading profits, consumption per head of wheat, meat, tea, beer, and tobacco – all of these showed an upward trend.”

Although the conventional wisdom is that deflation is bad, it makes sense to also take a look at the counter arguments coming from alternative points of view. After all, there seems to be a general correlation between people who believe deflation is bad and people who were oblivious to the impending economic collapse in late 2008.

That’s not how Gresham’s law works.The last point made by Williams in this particular section is a complete misunderstanding of Gresham’s Law. He argues:

“If bitcoin were allowed to co-exist as ‘legal tender’ it could also create a situation where under Gresham’s Law ‘Bad money drives out good.’ In such a scenario, bad currency (bitcoin) would be used and good currency (US dollar) would be hoarded, creating greater economic instability.”

Anyone who is involved in the bitcoin community understands that this is the exact opposite of how things work right now. If you’re someone who has adopted bitcoin, you’re mostly using it as a store of value (part of your savings). Remarkably, Williams seems to be aware of this fact, as he states, “Over 90 percent of bitcoin are also hoarded setting a temporary price floor.”

This point is actually also at odds with the previous argument made by Williams in regards to deflation. He seems to be claiming that bitcoin will be “dangerously deflationary” (increase in value over time), while at the same time claiming that people will choose to store the inflationary US dollar for long term savings.

This kind of logical inconsistency is a perfect example of why Williams should not be taken seriously as a bitcoin critic.

Chuck Reynolds
Contributor

 

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