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Universal Basic Income Test Runs Blockchain to Share Money Worldwide

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Universal basic income, commonly referred to as UBI, dates back to the 16th century when Sir Thomas More depicted a society in which every person receives a guaranteed income in his famous book Utopia. While Utopia is a fictional work, the reality of a basic income has come to fruition, as it has been reported that the number of people unemployed in the United States has reached 36 million — a number comparable to the Great Depression. 

Yet as the U.S. federal government attempts to distribute a one-time stimulus payment to American citizens, it has become clear that many issues with current UBI models remain. For example, many individuals have yet to receive their stimulus checks, leading to questions over how that much money can be moved reliably and repeatedly. Additionally, how can fraud, glitches and abuse of these vulnerable systems be prevented?

The CEO and co-founder of the cryptocurrency investment platform eToro, Yoni Assia, believes that blockchain technology may help solve some of the challenges associated with UBI models. After spending over 10 years building out eToro with the goal of making global markets open and transparent, Assia turned his attention to a project focused on delivering UBI worldwide.

Assia told Cointelegraph that the nonprofit initiative known as GoodDollar has the goal of creating a world in which everyone has access to basic economic assets. The project, which is being sponsored by eToro, aims to give away small amounts of basic income to onboard new users into the digital asset space while creating a better society. He said:

“The idea behind UBI is that every person gets some kind of monthly income, irrelevant to their work or educational status. There is also the assumption that UBI models can only be launched nationally, where a local government increases taxes to fund UBI programs. However, this model is unappealing to most. There is also less trust in governments today, which is why we believe the opportunity for a model like GoodDollar can flourish.”

According to Assia, the GoodDollar initiative is built on the Ethereum public blockchain and includes a cryptocurrency known as “G$,” which is distributed as basic income to network participants. Each transaction is recorded on the blockchain and can be easily traced to ensure that basic income is going to the correct recipients, with smart contracts being leveraged to send out recurring payments.

Assia explained that the capital behind each GoodDollar is generated from interest earned on crypto or by staking crypto through protocols such as MakerDAO or upcoming platforms such as ETH 2.0, which is designed for staking. He added:

“The initial value of GoodDollars will either be created by people buying and selling goods/services for GoodDollars or by people voluntarily staking assets for the purpose of improving equality in the world.”

How does the GoodDollar model work?

GoodDollar launched its digital UBI wallet at the beginning of May to start delivering capital. While a public demo version of the wallet is now available online, it’s important to point out that an internal project was initially conducted by eToro in January of this year to test how a blockchain-based UBI model would perform.

Assia noted that the goal of the project was to stimulate trade in GoodDollar’s G$ coins between individuals in a closed marketplace. He said, “Over the five month closed beta, hundreds of participating eToro employees conducted tens of thousands of dollars worth of commerce.” Following the internal test, Assia explained that over 300 eToro employees used their UBI wallets to donate $100,000 to local Israeli charities that are combating the coronavirus pandemic, saying:

“This internal project ended two weeks ago. We gave all eToro employees $200 dollars and let them choose from one of the four charities to donate their GoodDollars to. For every $200 donated to a hospital, we would match that amount in fiat (shekels), which was then distributed evenly across the four charities to make an impact.”

Can this model be applied in the real world?

While Assia believes that society is getting closer to the point in which any monetary policy can be defined by code — noting that cryptocurrencies such as Bitcoin have proven to be globally accessible and exchangeable — problems still remain with a blockchain-based UBI system.

According to Assia, technology is the number one challenge for building a decentralized system at scale. While the GoodDollar beta currently runs on Ethereum, Assia explained that social identity is needed for a project to scale, an element which is currently being researched.

The need for a unique digital identity was exemplified by the team behind the cryptocurrency Manna. Launched in 2017 and managed by the nonprofit Hedge for Humanity, Manna created a project that applies the universal aspects of UBI to a blockchain-based system.

Manna’s co-founder and director of networking, Brandon Venetta, told Cointelegraph that Manna immediately started gaining traction after it was launched, which was around the same time that Bitcoin (BTC) reached its all-time high of nearly $20,000. He noted that the project grew from a few thousand users to nearly 100,000 in a matter of months. However, while Manna was initially successful, Venetta explained that the project was not scalable, saying:

“In terms of capital, the first phase came from donations. We had a wallet that was preloaded with Manna tokens for our users. Unfortunately, while there were lots of people signing up for the platform, we discovered that many accounts were fake or created more than once. This led us to believe that unique identity is a problem much bigger than we had anticipated.”

In order to solve this problem, Manna partnered with the social identity network BrightID. Hedge for Humanity board member Philip Silva told Cointelegraph that BrightID provides digital uniqueness through social analysis, noting: “BrightID builds out a social web where a person’s connections vouch for their identity. No personal information is required, as groups are leveraged in the platform to prove that users are unique.”

While Manna’s initial blockchain-based UBI system was flawed, Hedge for Humanity and Manna are now working on a new initiative called “Citizen Income Experiment” in which any asset — such as stocks, bonds or crypto — could be used to deliver basic income to those in need. BrightID is being leveraged to prove users’ identities to combat the issues found in the previous UBI model. Silva added:

“The Citizen Income Experiment will start as a raffle that will allow people anywhere to sign up for the chance to win a one year UBI paid out monthly as $100 worth of crypto (either BTC, ETH or DAI). BrightID will be leveraged to ensure that users enter the raffle only once. This will help us validate BrightID’s capabilities.”

In addition to digital identification, Assia noted that decentralized UBI systems require a network effect in order for value of new capital to be created. He noted that in order for GoodDollar’s coins to obtain value, a network effect is needed to enforce the usability of the currency. However, this is easier said than done. Alex Howlett, an economist and the founder of Project Greshm, told Cointelegraph that blockchain is not a reasonable technology for UBI models.

Howlett said that when designing the Greshm system — a complementary monetary system that sits on top of the U.S. dollar, similar to the dollar’s former link to gold — he looked to blockchain to see if it could assist with certain challenges but found that it was irrelevant, telling Cointelegraph:

“Money has to have a standard value that is maintained independently of the market. The pricing standard has to be set in terms of something not subject to market forces. There also needs to be an outside authority of the market force to create a standard of value for the economy.”

While this is one opinion, UBI expert Scott Santens, who is currently involved with former U.S. presidential candidate Andrew Yang’s UBI project, noted that blockchain-based UBI systems are theoretically possible. However, he pointed out the biggest barrier is getting enough people to use the new currency, adding: ”It needs to be extremely user-friendly, and it needs to be accepted as widely as Visa and Mastercard.”

Despite skepticism, Assia remains aware of the time it could take to implement a project such as GoodDollar, mentioning that this could be a very long-term initiative. He further noted that many other projects, such as the Citizen Income Experiment, are building out protocols to develop open UBI models, saying: 

“All of us are executing non-profit concepts and trying to understand how to enrich other projects in the space. There are lots of big ideas that need to be crystallized in execution, which will eventually benefit many people.”

Source: https://cointelegraph.com/news/universal-basic-income-test-runs-blockchain-to-share-money-worldwide

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RMIT launches cybersecurity and blockchain courses to fill skill gaps

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Such is the growing industry of cybersecurity that forecasts predict that Australia will require an additional 18,000 cyber security professionals by 2026.

To help remedy this shortfall, RMIT Online has announced two landmark postgraduate programs.

The Graduate Certificate in Cyber Security and Graduate Certificate in Blockchain-Enabled Business will equip students with the necessary skills in emerging specialisations. The qualifications will be delivered in partnership with industry leaders IBM, Palo Alto Networks and Stone & Chalk, with classes beginning in October 2020.

RMIT Online CEO Helen Souness said that the newest additions to the portfolio will equip Australian businesses for the fast-moving and uncertain future of work.

“Over the past few months, we have observed a significant shift in traditional ways of working and conducting business. The unpredictable nature of our current environment requires us to strengthen and accelerate our understanding of the digital landscape. Cybersecurity and blockchain technologies are emerging as business-critical skills and we are delivering the training that provides those skills in our workforce.” – RMIT Online CEO Helen Souness

Existing trends in cybercrime and the need for businesses to adopt emerging technologies to drive transformation have been accelerated by the COVID-19 pandemic, making it vital to fill skills shortages with industry-partnered digital education delivery.

According to Accenture’s Cost of Cybercrime study, the total cumulative value at risk from 2019-2023 from cybercrime is forecasted to be up to US$5.2 trillion, with each Australian organisation losing an average of US$6.79 million annually.

While Australia’s cyber security industry has the potential to almost triple in size to at least A$6 billion by 2026, our 18,000 jobs are tiny compared to the predicted worldwide skills gap of 2.93 million.

Source: https://australianfintech.com.au/rmit-launches-cybersecurity-and-blockchain-courses-to-fill-skill-gaps/

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WeChat Invests $70 Billion in Fintech, Including Blockchain and AI

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Chinese tech giant Tencent Holdings will allocate nearly $70 billion (500B yuan) over the next five years in fintech development, including blockchain, cloud computing, and artificial intelligence (AI).

Reuters reported on May 26 that the company, which is behind the WeChat messaging app, hopes to strengthen the development of fintech across the country, following the recent embrace of blockchain by the Chinese government. 

Tencent wants to expand to business services and will invest in 5G networks, Internet of Things (IoT) operating systems and large data centers, among others, 

Pandemic boosts blockchain interest in China

The tech giant said that the COVID-19 crisis had been a critical factor motivating companies to develop their cloud-based technology infrastructure.

According to Dowson Tong, senior executive vice president of Tencent, expediting this new infrastructure strategy “will help further cement virus containment success.”

Tencent’s financial support for blockchain technology builds on its recent announcement of strategic moves to cement its presence in blockchain development across China.

Chinese government adopts blockchain

Cointelegraph reported on April 30 that Tencent had opened applications for its new “Tencent Industrial Accelerator,” with a total of 30 places.

The National People’s Congress, China’s Parliament, and Chinese People’s Political Consultative Conference proposed a government-backed blockchain development fund on May 24 to build “a better governance system.”

Some provinces in China are also beginning to show interest in blockchain technology, such as Anhui, which has officially launched a blockchain platform for providing government services.

Source: https://cointelegraph.com/news/wechat-invests-70-billion-in-fintech-including-blockchain-and-ai

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After Spiking to February 2018 Levels, Bitcoin Fees Have Dropped 54%

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After spiking a week ago to levels last seen in February 2018, the average Bitcoin (BTC) transaction fee has fallen by more than half.

BitInfoCharts data shows that Bitcoin’s average fee decreased by nearly 54% from $6.65 on May 20 to $3.07 on May 25. The median — or most common —  fee peaked at $3.91, but has now fallen to $1.65.

Bitcoin Cash proponent Hayden Otto told Cointelegraph that if network congestion continues, it will push users to altcoins. He believes this happened in 2017:

“When BTC is operating at capacity with a huge black log of transactions, it will slowly [lose users to altcoins] again. […] I’m sure most people trying to move funds around would convert to another coin before withdrawing from exchanges.”

Bitcoin median and average transaction fee May 20-May 25 chart. Source: BitInfoCharts

Altcoins capitalize on Bitcoin’s congestion

Otto is founder of BitcoinBCH.com, and he argues that there is a direct correlation between Bitcoin congestion resulting in the higher fees we’ve seen recently, and users moving to competing cryptocurrencies. According to him, “this results in BTC’s market dominance declining while that of competing cryptos explodes.”

As Cointelegraph reported in early May, there was a considerable amount of speculation that Bitcoin’s block reward halving might destabilize its blockchain. Otto argues that the halving did indeed have this destabilizing effect on Bitcoin’s functional dynamics, although this was beginning to smooth out.

He said the number of unconfirmed transactions held in Bitcoin’s mempool recently stabilized at just over 20,000, after having reached this year’s highest level of more than 80,000. Otto suggests this is a sign that the Bitcoin network is regaining stability after its economy changed in the wake of the latest recent halvings.

On May 20, Bitcoin’s mining difficulty dropped by about 6 percent. Otto says that this difficulty adjustment is helping decrease the network’s congestion, but one adjustment may not be enough:

“We have already had one difficulty adjustment since the halving but it will take another one or two adjustments until it settles. Due to a decline in hash rate, blocks are being produced slower. BTC’s hash rate has dropped nearly 30% since the halving and the difficulty only lowered by 6%, thus difficulty will need to decrease further before blocks are mined at 10 minute average intervals.”

Source: https://cointelegraph.com/news/after-spiking-to-february-2018-levels-bitcoin-fees-have-dropped-54

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