Dormant Digital Assets

PsiQuantum's computer

Four and a half years ago I wrote The $65B Prize about the potential reward for developing a "sufficiently powerful quantum computer" capable of cracking Bitcoin's encryption. It was based on work by Aggarwal et al, who were then projecting it would happen between 2029 and 2044. The $65B was the notional value of the wallet containing the million Bitcoin Satoshi Nakamoto mined originally.i But I noted that:

Chainalysis estimates that about 20% of all Bitcoins have been "lost", or in other words are sitting in wallets whose keys are inaccessible. That is around another 3.6 million stranded Bitcoin or at the current "price" about $234B.

So the potential prize was almost $300B.

Nearly a year ago I followed up with The $740B Prize. There are two reasons why the prize was then bigger but is now smaller than that:

• Bitcoin's "price" had then increased from about $65K to around $107K, but it is now around $76K.
• Because the "market cap" of Michael Saylor's Strategy was 1.6 times the "market cap" of its stash of Bitcoin, it was possible to use Saylor's algorithm to amplify the prize. But the factor has decreased from 1.6 to 0.81, so the algorithm no longer works.

But the threat to Bitcoin, and other cryptocurrencies, is far worse than I described in either of these two posts. The date is closer and the range of threats much broader. Follow me below the fold for the details.

Angels in America

I have wanted to write this post for a long time, but I was waiting until I could visit the invaluable Royal National Theatre Archive to check my memory of their early productions. It doesn't look like I'll be in London any time soon, and I have the time now to write a long post about a long play, so here goes.

Growing up in London meant that theatre has always been an important part of my life. I have seen a great many plays including some legendary performances and magnificent productions, such as Royal National Theatre's 2014 King Lear. One of my particular theatrical interests is long-form plays. Highlights of this genre have included:

Play Text

• Ken Campbell's Science Fiction Theatre of Liverpool's 9-hour Illuminatus Trilogy
• The Magic Theatre's all-night production of Murray Mednick's Coyote Cycle
• The Royal National Theatre's 6-hour adaptation of Phillip Pullman's His Dark Materials
• Taylor Mac's 3x8-hour A 24-Decade History of Popular Music

But there is one such play that is very special to me, Tony Kushner's 7+ hour Angels in America. It is clearly among the greatest plays of the 20^th century. I was there at the beginning, and I have seen many productions since. Below the fold I recount my history with this masterpiece.

The Handoff Problem (Updated)

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Around twelve years ago, Google figured out the fundamental problem facing Tesla's Fake Self Driving. Almost nine years ago in Robot Cars Can’t Count on Us in an Emergency, John Markoff wrote:

Three years ago, Google’s self-driving car project abruptly shifted from designing a vehicle that would drive autonomously most of the time while occasionally requiring human oversight, to a slow-speed robot without a brake pedal, accelerator or steering wheel. In other words, human driving was no longer permitted.

The company made the decision after giving self-driving cars to Google employees for their work commutes and recording what the passengers did while the autonomous system did the driving. In-car cameras recorded employees climbing into the back seat, climbing out of an open car window, and even smooching while the car was in motion, according to two former Google engineers.

Gareth Corfield at The Register added:

Google binned its self-driving cars' "take over now, human!" feature because test drivers kept dozing off behind the wheel instead of watching the road, according to reports.

"What we found was pretty scary," Google Waymo's boss John Krafcik told Reuters reporters during a recent media tour of a Waymo testing facility. "It's hard to take over because they have lost contextual awareness."

Follow me below the fold for a wonderful example of Tesla's handoff problem, and a discussion of the difference between Tesla's and Waymo's approaches to self-driving.

Metastablecoin Fragmentation (updated)

A fundamental problem for decentralized systems like permissionless blockchains is that their security depends upon the cost of an attack being greater than the potential reward from it. Various techniques are used to impose these costs, generally either Proof-of-Work (PoW) or Proof-of-Stake (PoS). These costs have implications for the economics (or tokenomics) of such systems, for example that their security is linear in cost, whereas centralized systems can use techniques such as encryption to achieve security exponential in cost.

Shin Figure 3

Now, via Toby Nangle's Stablecoin = Fracturedcoin we find Tokenomics and blockchain fragmentation by Hyun Song Shin, whose basic point is that these costs must be borne by the users of the system. For cryptocurrencies, this means through either or both transaction fees or inflation of the currency. The tradeoff between cost and security means that there is a market for competing blockchains making different tradeoffs. In practice we see a vast number of competing blockchains:

Tether’s USDT sits on 107 different ledgers. ... USDC sits on 125.

The chart shows Ethereum losing market share against competing blockchains.

Shin's analysis uses game theory to explain why this fragmentation is an inevitable result of tokenomics. Below the fold I go into the background and the details of Shin's explanation.

Skynet Progress Report (updated)

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I, for one, welcome our new insect overlords

Kent Brockman in "Deep Space Homer", The Simpsons

In recent months Cyberdyne Systems Corporation and its many subsidiaries have made very encouraging progress towards removing some of the major road-blocks standing in the way of the initial deployment of Skynet. Below the fold I report on the most significant ones.

Tesla's Not-A-Robotaxi Service

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I have now seen the fabled CyberCab three times in real life. It has two seats, one of them fully equipped with human driver interface equipment. In each case a human was using them to drive the car, which is necessary in California because Fake Self-Driving is a Level 2 driver assistance system that requires a human behind the wheel at all times. A Robotaxi that requires a human driver and can carry at most one passenger isn't going to be a economic success.

Fred Lambert has two posts illustrating the distance between Musk's claims and reality. Below the fold I look at both of them:

The Kessler Syndrome

LEO in 2019 (NASA)

In 1978 Donald J. Kessler and Burton G. Cour-Palais published Collision Frequency of Artificial Satellites: The Creation of a Debris Belt. Wikipedia notes that:

It describes a situation in which the density of objects in low Earth orbit (LEO) becomes so high due to space pollution that collisions between these objects cascade, exponentially increasing the amount of space debris over time.

This became known as the Kessler Syndrome. Three decades later, shortly after Iridium 33 and Cosmos 2251 collided at 11.6km/s, Kessler published The Kessler Syndrome, writing that the original paper:

predicted that around the year 2000 the population of catalogued debris in orbit around the Earth would become so dense that catalogued objects would begin breaking up as a result of random collisions with other catalogued objects and become an important source of future debris.

And that:

Modeling results supported by data from USAF tests, as well as by a number of independent scientists, have concluded that the current debris environment is “unstable”, or above a critical threshold, such that any attempt to achieve a growth-free small debris environment by eliminating sources of past debris will likely fail because fragments from future collisions will be generated faster than atmospheric drag will remove them.

Below the fold I look into the current situation.