Daily Crypto, Finance and Tech News Summary – May 23, 2023

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Welcome, and thank you for being part of the MyZucoins community! Dive into our daily crypto, finance and tech news summary to stay in the know.

Light bulb invention

How People Reacted to Greatest Inventions in History: From Printing Press to Generative AI

Resistance and eventual acceptance have been common themes in society’s response to major inventions throughout history. The printing press, invented by Johannes Gutenberg in the 15th century, initially faced opposition from professional scribes and the Church. Concerns over job losses and the uncontrolled spread of ideas were prevalent. However, the printing press eventually gained widespread acceptance, creating numerous jobs in the publishing sector.

Similarly, the telephone sparked worries about social interaction and privacy when it was first introduced. Nevertheless, the telephone revolutionised long-distance communication and became an indispensable part of our daily lives.

The advent of the personal computer in the 1970s and 1980s triggered alarm and confusion. People feared job losses and struggled to grasp its usage, leading to the popularisation of the term “computer phobia.” Despite these doubts, computers have now become ubiquitous in homes and workplaces worldwide.

Generative AI, the most recent headline-grabbing breakout innovation, has generated a mix of enthusiasm, skepticism, and apprehension. Concerns about potential job losses and ethical implications coexist with recognition of AI’s potential to enhance our lives.

Cryptocurrency, another transformative invention, is disrupting the global economy. Despite the challenges it poses, cryptocurrencies offer benefits such as transactional privacy, security and individual control over financial transactions. They also foster a sense of global community beyond traditional financial institutions. Read more here.

Zucoins has caught much attention from its claims in recent years, following the product team’s progress on solving the many longstanding limitations of traditional blockchain-based cryptocurrencies. Overcoming blockchain’s scalability issues, high transaction fees and transfer delays, Zucoins offer a more efficient and user-friendly experience, from the ground up. All the while still maintaining individual control, privacy, and security.

Historical patterns suggest that despite initial resistance and fear, new inventions eventually gain acceptance and play significant roles in shaping our world. This pattern implies that generative AI and cryptocurrencies, despite existing concerns, may follow a similar trajectory. The other thing is, the cat is out of the bag. When this happens, it almost never can be truly stopped.

Navigating the Blockchain: Buterin’s Vision for Ethereum Amid Rising Costs

In a recent blog post, Ethereum co-founder Vitalik Buterin issued a stark warning against overloading Ethereum’s consensus mechanism, a process that validates blocks and secures the network. This mechanism, which switched from proof-of-work to proof-of-stake in September 2022, is the backbone of Ethereum’s stability. Buterin’s cautionary note comes in response to an increasing number of proposals suggesting the use of Ethereum’s consensus for additional purposes, such as price and data oracles, re-staking initiatives, and recovery mechanisms for layer-2 projects.

Buterin’s argument is rooted in the principle of preserving the blockchain’s minimalism. He contends that while the urge to extend the blockchain’s core functionality is natural, given its economic weight and community support, each extension risks making the core more fragile. High-risk examples include creating ETH/USD price oracles that could potentially be manipulated, leading to systemic risks like bugs or a 51% attack.

The Ethereum co-founder advocates for a case-by-case approach to these issues, acknowledging the need for better oracles but warning that expanding the duties of Ethereum’s consensus increases the costs, complexities, and risks of running a validator. His stance is clear: the focus should be on preserving the chain’s minimalism and helping developers find alternate strategies to achieve their security goals.

In the context of the emerging cryptocurrency product Zucoins, Buterin’s perspective offers a valuable lesson. Zucoins, operating in the controversial blockchain industry, aims to be a cutting-edge solution. However, it must navigate the delicate balance between innovation and stability. It can draw from Ethereum’s experience, understanding that while extending core functionality may seem attractive for its potential to drive growth and adoption, it also carries significant risks. Zucoins must ensure that any expansion of its core functions does not compromise the stability and security of its network, thereby maintaining user trust and the integrity of its platform. Read more here.

The Zucoins team has spent years addressing the scaling issues for a decentralised system. It’s an unbelievably hard problem to nail down, as regular readers will know. Splitchain’s network has clever mechanisms (more development is constantly happening on this), to resolve the ongoing problems associated with scaling blockchain-based cryptocurrencies.

Instead of going down the traditional systems’ workaround by adding more layers, layer-1, 2, 3, etc. An approach which essentially causes the network to outsource its activity to often private corporations, who bundle transactions together, then stamp a combined result back to the layer 1 chain. They do this to put less individual transactions back on the layer 1 (the base system), which struggles with the bandwidth.

A problem is, if this corporation managing these bundled transactions disappears, a whole chunk of activity history can disappear along with it. This opens up a potential minefield when having to prove how something happened historically on the network. It matters for a number of reasons, with just one being potentially more difficult compliance with existing corporate and financial infrastructure, as more and more regulations come into play around the world.

The goal of course is, as the article touches on, is to lay the foundation for a network that can more easily handle more activity, while not making important data heavily delegated, as in the case of many scaling solutions for traditional blockchains. Doing this should create ample space for organisations to build and innovate on such networks.

The Changing Landscape of Global Cryptocurrency: US’s Dominance Challenged

Ark Invest analyst Yassine Elmandjra has stated that the United States risks losing its leading position in the global cryptocurrency ecosystem to countries like the United Arab Emirates, South Korea, Australia, and Switzerland. The analysis points to a significant decrease in cryptocurrency liquidity in the US, with Bitcoin trading volume falling 75% from $20 billion per day in March to around $4 billion recently.

Elmandjra suggests that regulatory uncertainty in the US is discouraging both existing firms and new entrants in the cryptocurrency space. This uncertainty has led to trading firms like Jane Street and Jump Trading reducing their participation in the domestic US market.

The article also highlights that the UAE is attracting attention from cryptocurrency miners, with Marathon Digital announcing that Abu Dhabi will host the first large-scale Bitcoin mining operations in the Middle East. In contrast, proposed taxes on miners in the US could push firms to look outside the country. Read more here.

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