[Cryptography] Banks are not all the same, My Identity definitely not Satoshi Nakamoto

[Charles I Cunningham]

Wow!
Satoshi Nakamoto lives! If only he could remember where he put those
private keys!

Here are my thoughts, I hope you find them helpful.

Blockchain is a great technology but it is wasted on crypto

The economic model that underpins the value of fiat currencies is a thing
of beauty and efficacy, and as we  know the economic model for most crypto
schemes is junk. The value of Bitcoin is maintained (in my opinion) by
shameless market manipulation.

However, fiat money expressed on a decentralized blockchain is a great
idea.
You get the benefit of using real money combined with the benefits of
decentralized blockchain:

   - censor resistance,
   - low transaction charges,
   - relatively fast transaction completion,
   - global reach,
   - non repudiation of transactions,
   - privacy

Banks are becoming subject to censorship. Ill judged regulation is now a
problem, for example, UK banks now apply rules concerning
politically exposed individuals to UK residents. These rules were created,
by the FATF, to help curb corruption in emerging world economies. The
consequence is that people in the UK who participate in the democratic
process such as MPs and government ministers and local councillors are now
finding that some banks are withdrawing facilities from them. And this
extends to their family members!

As an example, Jeremy Hunt revealed that he was denied a bank account by
the online bank Monzo before he became Chancellor. This incident occurred
due to his status as a politically exposed person.

This is the thin  end of a very fat wedge.

Here is a point of interest regarding Bitcoins proof of work: Bitcoin is
currently consuming between 90 TWh and 180 TWh (0.5% of global energy)  per
year (see statista.com:bitcoin-energy-consumption
<https://www.statista.com/statistics/881472/worldwide-bitcoin-energy-consumption/>).
Since it manges 2 to 3 transactions per second, which is about 90 million
transactions per year, each transaction consumes between 1 MWh to 2 MWh of
energy. A Tesla can drive 4 miles per KWh. So that's enough energy for a
4000 to 8000 mile road trip. Enough for  Elon to drive his Model 3 from SF
to NYC and back again!

Bitcoin is valued at c. $60000 at the moment. This gives a network value of
c. $1.2 trillion.
According to the IMF the total value of global financial assets is
estimated at $600 trillion, so Bitcoin represents about 0.2% of all the
world's financial assets.
If the Bitcoin proof of work model were in some dystopian future to be used
as the way we secured all  financial assets, and we want them to be as
secure as Bitcoin, this implies using  500 times as much energy as Bitcoin
uses today: 250% of current global energy consumption.

Proof of work is not the way forward.
Think proof of stake as the future of decentralized blockchains.

Charles Cunningham
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