POST Cities in states

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Pronomos is the only one with seed money from boldface names including Thiel, venture capitalist Marc Andreessen, and Bitcoin evangelists Roger Ver and Balaji Srinivasan. In describing his new firm, Friedman isn’t shy to use seasteading as a reference point. “I’ve been putting these ideas out there for 20 years, and they’ve grown and compounded,” he says, sipping well water at his mountaintop compound south of San Jose. “What we get excited about is the ability to do this repeatedly.”
Why the colonial-sounding framework, right down to the old British laws? Dressed in a well-loved Slytherin sweatshirt, Friedman says it’s the best fuel for a fledgling economy and property values, and to assure global investors that their money will be safe in Pronomos projects. The justice system is more important than the tax breaks,

From Silicon Valley Seasteaders Go Looking for Low-Tax Sites on Land – Bloomberg:

Now, a city with autonomy that operates under English Common Law (there is no “British law” as commentators pointed out) sounds a bit like Hong Kong, which was undoubtedly a successful model for economic development. This is an interesting reflection on the idea xxx

Charter cities are a stillborn baby with a million would-be midwives. If it happens at all, it will evolve out of some Belt and Road contract clause where the borrower didn’t pay back the loan.

From A new charter city effort, Pronomos Capital, with venture capital – Marginal REVOLUTION:

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Lawmakers in New York are trying to correct this with a new bill that would create a “public Venmo” system designed to include more people in the formal economy and stimulate local economic growth. In November, New York State Assemblymember Ron Kim, Senator Julia Salazar, and Cornell law professor Robert Hockett announced their Inclusive Value Ledger (IVL) proposal. If passed, it would create the country’s first publicly owned electronic banking platform, as well as a digital currency that can be exchanged for goods and services within the state.

From New York Is Proposing the Creation of a ‘Public Venmo’ – VICE:

 

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When China and other big countries launch cryptocurrencies, it will kick off a global revolution

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“countries will form cryptocurrency unions to regulate currencies and platforms, standardise technology and maintain the stability of the system”

From “When China and other big countries launch cryptocurrencies, it will kick off a global revolution”.

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(4) Kremlin throws weight behind EU effort to boost Iran trade | Financial Times

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“Moscow’s support for Instex prompted a warning from US Treasury secretary Steven Mnuchin, who attended a G7 financial meeting in France.

‘If you want to participate in the dollar system you abide by US sanctions,’ Mr Mnuchin said, after discussing Iran with his French counterpart Bruno Le Maire.”

From “(4) Kremlin throws weight behind EU effort to boost Iran trade | Financial Times”.

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POST It’s MPE time again!

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RBR forecasts that the number of merchant outlets accepting cards worldwide will grow by 51% between end-2018 and end-2024, from 70.8 million to 107.1 million, largely driven by initiatives from governments to encourage cashless payments. Moreover, downward pressure on interchange fees is leading to reduced merchant service charges and improving the business case for merchants to accept cards.

From Discover the most widely accepted card scheme worldwide:

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Innocent people arrested following surveillance blunders, IPCO reveals

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“Innocent people have been questioned by police, had computer equipment confiscated and faced arrest when suspected of serious crimes following errors made by internet service providers (ISPs), telecoms companies, police and other public bodies in gathering intelligence through electronic surveillance.”

From “Innocent people arrested following surveillance blunders, IPCO reveals”.

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Facebook contractor accepted bribes to restore banned accounts: report – Business Insider

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“In October an investigative report from BuzzFeed detailed how Ads Inc. paid to place deceptive ads on thousands of personal Facebook accounts. Ads Inc. reportedly paid Facebook users $15 to $30 per month for access to their account, then sold those accounts to other marketers for $800 each.

By paying Facebook users to post ads on their personal page, Ads Inc. and other companies are able to circumvent Facebook’s policies for paid advertisements. Facebook prohibits account rentals and deceptive advertisements, and Facebook has been actively banning accounts sharing posts for Ads Inc.

However, Ads Inc. CEO Asher Burke and other employees offered multiple Facebook contractors payment in exchange for reversing the bans”

From “Facebook contractor accepted bribes to restore banned accounts: report – Business Insider”.

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History of live five

Oh man! 2017!

This was the first public “live five” of technology-driven changes in the secure transactions field that we thought would have a real business impact over the previous year. We’d used the idea internally before, but in 2017 we made the predictions public in the spirit of openness and honesty that we are famed for, to see how the predictions held up.

  1. RegTech. I think we did pretty well with this prediction. Interest in regtech has grown throughout the year and the ability of regtech to make real differences in major markets is established.
  2. Digital Identity. As we noted, one of the key regtechs, if not the key regtech, is digital identity. It did shoot up the agenda over the year and some interesting initiatives opened up.
  3. PSD2 (still). No commentary is needed!.
  4. Paying on the Go. We thought that a key use of open APIs will be payments, and very likely mobile payments. MasterCard’s purchase of VocaLink would tend to support this view!
  5. Invisible POS.  The shift from “check out to check in” paradigms is underway but it is fair to observe that we did not see the number of launches we were expecting as many of the projects remain in beta and will be holding to wait for the arrival of PSD2 (and CMA remedies in the UK).

Not bad. Actually a pretty good high level view of the kind of areas our clients began to prioritise five years go.

2018 not bad!

This was the “live five” for 2017. Let’s see how we did…

  1. Open Banking. Well, it was hardly a tough call and we were bang on with this one. We were working on open banking projects in the UK, on the continent and beyond, so there was no need to guess at the importance.
  2. Conversational Transactions. Yes, we were spot on with this one and not only in financial services. Many organisations began planning to move to messaging both for customer support and for transactions.
  3. The Internet of Cars. This continues to develop, although the security concerns that we spoke about before continue to add friction to the development of new products and services in this space.
  4. Artificial Intelligence. Again, this was an easy prediction because many of our clients were already active, although to be fair most of their spending was on machine learning rather than “true” AI.
  5. Tokens/ICOs.  Well, we were right to highlight the importance of “tokens” (the basis of Initial Coin Offerings, or ICOs) and our prediction that once the craziness is out of the way, then regulated token markets will become significant looks to be borne out by mainstream commentary.

As we said back then, 2018 saw disruption because the shift to open banking, starting in the UK, meant the reshaping of financial services.

On a roll for 2019!

Last year we began organising our “live five” in a slightly different way, listing them by priority to our clients rather than as a simple list. So we put together the four key technologies that we thought would be hot last year together with a new technology that we were looking at out of the corner of our eyes. We went with…

  1. The most important technology at the customer interface from the secure transactions perspective is going to be the technology of Secure Customer Authentication (SCA). We knew that better authentication technology would make life easier for clients in a number of ways, not only because of PSD2.

  2. We thought more organisations around the world would look at the cross-sector digital identity initiatives and this is what happened in Canada and Australia for example.

  3. From our work on ticketing around the world we saw a renewed focus on the deployment of real digital wallets  because transit (and other forms of ticketing, such as the sporting events) are what make consumers start using digital wallets, not payments.

  4. We expected to see a growing use structured risk analysis for IoT. This has begun, but not to the extent that we though it would. The 

  5. We thought it was time to start talking about post-quantum cryptography (PQC) in the mainstream and we were very right about this.

 

So a pretty accurate outline for the previous 12 months and in fact the renewed focus on identity, authentication and authorisation as the basis for transactions was emphasis early in the year when Mark Carney, the Governor of the Bank of England, spoke early in the year about the significant need for, and the high priority of, digital identity infrastructure for the financial sector.

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