Category: Web/Tech

Surveillance sentences to ponder

One of the surveillance industry’s recent — and much publicised — success stories took place at a pop concert in eastern China. While Jacky Cheung, a Hong Kong pop star (rebranded a “fugitive trapper” by the Chinese media) crooned, cameras were automatically sweeping the audience.  Facial-recognition technology picked out four men accused of crimes — including a ticket scalper and a greengrocer accused of a Rmb110,000 potato scam in 2015. “Smiling as he approached his idol, he did not realise he had already been spotted,” Jiaxing police gloated in a social-media post.


Some of China’s leading facial-recognition players, for example, are now moving into gait recognition. Hanwang Technology was an early entrant in the field: it was forced to rethink its fingerprint-recognition technology when the Sars epidemic of 2005 left people in China terrified of physical contact.  “We can see the human figure and his gait, so if his cap is pulled down [we] can still recognise him,” explains Liu Changping, president of the Beijing-based company. The Chinese authorities already have a decent video database to build on, he adds: “If [someone] was put in prison before, there’s video of him walking around.”

That is from Louis Lucas and Emily Feng from the FT, interesting throughout.

My Conversation with Vitalik Buterin

Obviously his talents in crypto and programming are well-known, but he is also a first-rate thinker on both economics and what you broadly might call sociology.  You could take away the crypto contributions altogether, and he still would be one of the very smartest people I have met.  Here is the audio and transcript.  The CWT team summarized it as follows:

Tyler sat down with Vitalik to discuss the many things he’s thinking about and working on, including the nascent field of cryptoeconomics, the best analogy for understanding the blockchain, his desire for more social science fiction, why belief in progress is our most useful delusion, best places to visit in time and space, how he picks up languages, why centralization’s not all bad, the best ways to value crypto assets, whether P = NP, and much more.

Here is one excerpt:

COWEN: If you could go back into the distant past for a year, a time and place of your choosing, you have the linguistic skills and immunity against disease to the extent you need it, maybe some money in your pocket, where would you pick to satisfy your own curiosity?

BUTERIN: Where would I pick? To do what? To spend a year there, or . . . ?

COWEN: Spend a year as a “tourist.” You could pick ancient Athens or preconquest Mexico or medieval Russia. It’s a kind of social science fiction, right?

BUTERIN: Yeah, totally. Let’s see. Possibly first year of World War II — obviously, one of those areas that’s close to it but still reasonably safe from it…

Basically, experience more of what human behavior and what collective human behavior would look like once you pushed humans further into extremes, and people aren’t as comfortable as they are today.

I started the whole dialogue with this:

I went back and I reread all of the papers on your home page. I found it quite striking that there were two very important economics results, one based on menu costs associated with the name of Greg Mankiw. Another is a paper on the indeterminacy of monetary equilibrium associated with Fischer Black.

These are famous papers. On your own, you appear to rediscover these results without knowing about the papers at all. So how would you describe how you teach yourself economics?

Highly recommended, whether or not you understand blockchain.  Oh, and there is this:

COWEN: If you had to explain blockchain to a very smart person from 40 years ago, who knew computers but had no idea of crypto, what would be the best short explanation you could give them, basically, for what you do?

BUTERIN: Sure. One of the analogies I keep going back to is this idea of a “world computer.” The idea, basically, is that a blockchain, as a whole, functions like a computer. It has a hard drive, and on that hard drive, it stores what all the accounts are.

It stores what the code of all the smart contracts is, what the memory of all these smart contracts is. It accepts incoming instructions — and these incoming instructions are signed transactions sent by a bunch of different users — and processes them according to a set of rules.

Stripe Press

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Link here.

Jack Goldsmith on cybersecurity and international law

…the U.S. intelligence services break into computers and computer networks abroad at an astounding rate, certainly on a greater scale than any other intelligence service in the world.

How will the United States respond when Russia and China and Iran start naming and indicting U.S. officials?  Maybe the United States thinks its concealment techniques are so good that the type of detailed attribution it made against the Russians is infeasible.  (The Shadow Brokers revealed the identities of specific NSA operators, so even if the National Security Agency is great at concealment as a matter of tradecraft that is no protection against an insider threat.)  Maybe Russia and China and Iran won’t bother indicting U.S. officials unless and until the indictments actually materialize into a trial, which they likely never will.  But what is the answer in principle?  And what is the U.S. policy (if any) that is being communicated to military and civilian operators who face this threat?  What is the U.S. government response to former NSA official Jake Williams, who worked in Tailored Access Operations and who presumably spoke for many others at NSA when he said that “charging military/gov hackers is dumb and WILL eventually hurt the US”?

The post has many other points of interest, a number of them uncomfortable truths.

Madagascar fact of the day

Madagascar, one of world’s poorest countries, has the fastest broadband internet speed in Africa and has average speeds much faster than some of the world’s wealthiest nations, according to a broadband speed league table from UK analytics firm Cable, which collects data from 200 countries.

At 24.9 megabits per second, Madagascar’s broadband speed is more than twice the global average. Not only does this mean the African island nation has the fastest internet speed on the continent, but it places 22nd in the world, out-pacing Canada, France, and the UK.

Here is the full story.  Here is the previous installment of Madagascar fact of the day, namely that per capita income was almost twice as high in 1960.

Good-bye soccer moms? (and dads)

Or U.S.A. fact of the day:

Over the past three years, the percentage of 6- to 12-year-olds playing soccer regularly has dropped nearly 14 percent, to 2.3 million players, according to a study by the Sports & Fitness Industry Association, which has analyzed youth athletic trends for 40 years. The number of children who touched a soccer ball even once during the year, in organized play or otherwise, also has fallen significantly.

…In general, participation in youth sports nationwide has declined in the past decade, as children gravitate to electronic diversions and other distractions…

“It’s lost more child participants than any other sport — about 600,000 of them,” said Tom Farrey, executive director of the Aspen Institute Sports & Society Program.

That is from Joe Drape at the NYT.

Augur is live

Augur is finally live.

The decentralized platform for betting on real-world predictions was one of the first applications built on top of the ethereum blockchain, and its creators  sold “reputation” (REP) tokens for over $5 million in 2015 – a time when few were talking about “ICOs” or “utility coins.” A public beta version of the platform came out the following year, and its team published a revised version of its white paper in January.

Now, the Forecast Foundation, the not-for-profit behind Augur’s development, has announced the launch of the long-awaited platform, which was accompanied by the release of the final version of the Augur application as open-source software.


Augur allows participants to bet on anything.

As long as the outcome can be verified in the real world, users can create a prediction market for anything from ether’s price, an election in Brazil or the outcome of Iceland v. Argentina in the World Cup.

What distinguishes Augur from a traditional betting market is that no single party sits in the middle, meaning that users are likely to pay lower prices.

Removing the centralized intermediary from a betting market presents a problem, however: how to bring dispersed, financially interested parties into agreement about the actual outcome of the predicted event?

In Augur’s system, the creator of a prediction market designates a “reporter” to vet the outcome. This designated entity puts down a deposit of REP tokens, which they lose if they incorrectly report the outcome and other REP holders challenge them. The reporter is compensated through fees.

Day-to-day betting is not done in REP, but in ether, the native token of the ethereum blockchain (though, eventually, the plan is to support other ethereum-based tokens). Users can buy and sell shares in particular predictions, which are priced according to the likelihood the market attaches to each outcome.

Here is the full Coindesk article, here is the white paper, here is their home page.

CIVIL and the future of media?

David Siegel emails me:

CIVIL is a new start-up from Consensys, whose goal is to change journalism.

The Civil marketplace is built on a protocol that in turn is built on the Ethereum blockchain.

This ecosystem is built around a token-curated registry, using what we call a “skin-in-the-game coin,” the CVL. This is an application of mechanism design to blockchain-based tokens that can be acquired, exchanged, and go up in value, creating a new micro-economy for – in this case – truthy journalism. The basic unit of Civil is a newsroom. A newsroom is a person or group who can publish anything they like. They can charge readers using CVL tokens or credit cards or anything else. What makes Civil interesting is that anyone can challenge a story’s veracity.

To challenge a story, you send some CVL coins to a smart contract. The community then votes on the veracity of the story, or even the newsroom itself. Anyone who votes must stake coins. If the story is voted true, those who voted true take the pot – they win all the staked tokens. If the community finds it’s false, then those who voted for false share the purse. This skin-in-the-game mechanism is the next evolution of communities like Steem and is game-theoretically far more advanced than Reddit or Quora. It promises to eliminate fake ratings, reviews, and content farms pumping out propaganda. By creating token-based games that reward virtuous behavior – the first one of which was Bitcoin – today’s blockchain entrepreneurs promise to bring us a new era of less biased news, better blogging, more accurate ratings, and potentially better science.

Mobile money in Somaliland

Since its launch in 2009, Zaad, which means “to grow” in Somali, has swelled to 850,000 users—roughly one-quarter of the nation’s population. Locals use the platform on battered old cellphones and, less frequently, on smartphones and a designated app.

Without mobile money, cash has a hard time flowing through the country. No commercial banks really operate here, and hauling physical cash over rough roads is time-consuming. Companies use Zaad for their monthly payrolls, instead of handing wads of cash to their employees.

Today, each user on average makes 35 Zaad transactions a month, and Somalilanders say they try to use Zaad for most transactions. A rudimentary texting system makes it easy even for the many Somalilanders who are illiterate.

It seems to be a kind of free banking:

Apart from phone-to-phone transactions, users can top up their mobile wallets by handing cash—shillings [the Somaliland currency] or dollars—over to an official agent, who is often a single person in a shack on the side of the road.

“This service has been a driving force for the smooth operation of our economy,” said Abdikarim Dil, Telesom’s chief executive.

Since mobile-money services aren’t regulated by the central bank, they aren’t subject to the restrictions that traditional banks face, including requirements meant to block terror financing.

Here is the story (WSJ) by the consistently interesting Matina Stevis-Gridneff (there are few journalists better to read these days), via the excellent Samir Varma.

Informational autocrats

That is a new and important paper by Sergei M. Guriev and Daniel Treisman, here is the abstract:

In recent decades, dictatorships based on mass repression have largely given way to a new model based on the manipulation of information. Instead of terrorizing citizens into submission, “informational autocrats” artificially boost their popularity by convincing the public they are competent. To do so, they use propaganda and silence informed members of the elite by co-optation or censorship. Using several sources–including a newly created dataset of authoritarian control techniques–we document a range of trends in recent autocracies that fit the theory: a decline in violence, efforts to conceal state repression, rejection of official ideologies, imitation of democracy, a perceptions gap between masses and elite, and the adoption by leaders of a rhetoric of performance rather than one aimed at inspiring fear.

Again, here is my related Bloomberg column from June 18.

If technology has arrived everywhere, why has income diverged?

That is the topic of a new paper by Diego Comin and Martí Mestieri, published in AEJ: Macroeconomics, here is the abstract:

We study the cross-country evolution of technology diffusion over the last two centuries. We document that adoption lags between poor and rich countries have converged, while the intensity of use of adopted technologies of poor countries relative to rich countries has diverged. The evolution of aggregate productivity implied by these trends in technology diffusion resembles the actual evolution of the world income distribution in the last two centuries. Cross-country differences in adoption lags account for a significant part of the cross-country income divergence in the nineteenth century. The divergence in intensity of use accounts for the divergence during the twentieth century.

I am struck by the strength of the two major stylized facts in this paper.  The mean adoption lag for spindles, classified as a 1779 technology, was 130 years, or in other words that is how long it took for the technology to move to poorer countries.  For ships, listed as a 1788 technology, the mean lag is 110 years.  Synthetic fiber is a 1931 technology, with a mean adoption lag of 29 years.  For the internet, a 1983 technology (is that right?), the mean adoption lag is only 6 years.

But the overall story is not so simple.  The more advanced countries use more of these technologies, and use them more effectively (“intensity”), and that gap has been growing over time.  Yes, Ghana has the internet, but it is Silicon Valley that is working wonders with it.  Some technology use begs more technology use.

If you calibrate those parameters properly, it turns out you can explain about 3/4 of the evolution of income divergence across rich and poor countries.

Time of death, fame, and the internet: a hypothesis

If you were somewhat known, but not very super-duper famous to begin with, it was bad for your reputation to have died right before the internet became “a thing.”

You will have relatively few traces on the internet itself, and right after your death people all of a sudden had this new medium for chatting with others about all sorts of other fascinating things, most of them not you.

Will the European Union ruin the internet?

A committee of MEPs has voted to accept major changes to European copyright law, which experts say could change the nature of the internet.

They voted to approve the controversial Article 13, which critics warn could put an end to memes, remixes and other user-generated content.

Article 11, requiring online platforms to pay publishers a fee if they link to their news content, was also approved.

One organisation opposed to the changes called it a “dark day”.

The European Parliament’s Committee on Legal Affairs voted by 15 votes to 10 to adopt Article 13 and by 13 votes to 12 to adopt Article 11.

It will now go to the wider European Parliament to vote on in July.

…Article 11 has been called the “link tax” by opponents.

Here is further information.  If ever there was a case for Brexit…

For the pointer I thank Saku.

*High Growth Handbook: Scaling startups from 10 to 10,000 people*

Edited, produced, and partly written by Elad Gil, the book is also a series of interviews with Marc Andreessen, Sam Altman, Patrick Collison, Reid Hoffman, Keith Rabois, Naval Ravikant, and others.

Marc Andreessen says:

If you don’t start layering in HR once you’ve passed 50 people on your way to 150, something is going to go badly wrong.

Claire Hughes Johnson (COO of Stripe) says:

When I came into Stripe, I had a similar document.  I wrote a document back when I was at Google called, “Working with Claire.”  And when I first got to Stripe, I adapted it slightly, but it was pretty relevant.  I shared it with everyone who was working with me closely, but I have made it an open document.  It spread quite quickly through the organization…I think that founders should write a guide to working with them.

Patrick Collison says:

..the CEO ultimately does not have that many jobs, but I think culture is among them.  And it ought not be delegated.  Briefly speaking, I think there are five top responsibilities of a CEO: being the steward of and final arbiter of the senior management; being the chief strategist; being the primary external face for the company, at least in the early days; almost certainly being the chief product officer, although that can change when you’re bigger; and then taking responsibility and accountability for culture.

Self-recommending, you can order it here.