Creator of Signal to Potentially Transform the Usage of Cryptocurrency

Signal by Open Whisper Systems transformed the world of encrypted messaging and encrypted calling. Beyond that, the Signal Protocol (formerly called the Axolotl ratchet) that the brilliant cryptographic engineer Moxie Marlinspike helped design has vastly improved the usage of end-to-end encryption for hundreds of millions of people. Apparently Marlinspike has been working on improving the functionality of cryptocurrency for the masses lately, and based on his past work, he will probably have a significant impact on that area too.

Cryptocurrency remains confusing and challenging for the average person to acquire and manage, much less sell. And the protocols that underlie bitcoin and other mainstream cryptocurrencies like ethereum suffer significant scalability and transaction bottleneck issues. Visa currently processes about 3,674 transactions per second; the best bitcoin network might be able to process seven per second.

But now the creator of the dead simple end-to-end encrypted messaging app SignalMoxie Marlinspike, is on a mission to overcome those limitations, and to create a streamlined digital currency that’s private, easy-to-use, and allows for quick transactions from any device. And while it may feel like the last thing the world needs is yet another cryptocurrency, Marlinspike’s track record with Signal—and the organization behind it, Open Whisper Systems—makes this a project worth watching.

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MobileCoin wants to leverage an extensive architecture to add simplicity to real privacy protections and resilience against attacks. The ultimate goal: To make MobileCoin as intuitive as any other payment system.

That vision mirrors the animating purpose of Signal, which was developed to make robust end-to-end encrypted communication as easy and straightforward as less secure options, a simple experience that belies the complex cryptographic communication protocols that enable it.

“I think usability is the biggest challenge with cryptocurrency today,” says Marlinspike. “The innovations I want to see are ones that make cryptocurrency deployable in normal environments, without sacrificing the properties that distinguish cryptocurrency from existing payment mechanisms.”

[…]

There are lots of potential applications for MobileCoin, but Goldbard and Marlinspike envision it first as an integration in chat apps like Signal or WhatsApp. Here’s how it would work in practice: To start using MobileCoin, you would generate a public and private key, and a recovery PIN. Then you would set up your account with an app that incorporates MobileCoin. The app would validate the software running in its service’s node, establish an encrypted communication channel to the enclave, and then send your keys and the short, easy-to-remember recovery PIN that you’ll use to access your MobileCoin—like a smartphone lock passcode.

[…]

And though speculation has driven bitcoin to all-time-high valuations, most cryptocurrencies don’t end up capturing much value, languishing instead in far-flung corners of the internet. Here again, though, MobileCoin’s creators hope to emulate Signal. End-to-end encryption was once a fringe feature; then WhatsApp gave it to a billion people at once using the Signal Protocol.

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Republican Congress Seeking to Deregulate Wall Street and Thus Cause Another Economic Downturn

Deregulating (and misregulating) Wall Street has been done before with disastrous consequences. The repeal of the Glass-Steagall Act in 1999 for example was a significant factor in causing the global economic collapse of 2008. Looking back further in the 20th century, it was the Republican party that controlled Congress and the White House in the 1920s before the Great Depression. That should cause people to be aware of what might happen soon.

WITH THE GOP’S tax plan moving ahead and the Obamacare fight in the rearview mirror, Republicans in Congress are setting their sights next on deregulating Wall Street.

But unlike the previous battles, they can count on Democratic help in this fight.

They will also face an invigorated populist wing of the party. During the debate over whether to create the Consumer Financial Protection Bureau, Elizabeth Warren, not yet a senator, famously said at a crucial momentthat her first choice was a strong agency, and her second was “no agency at all and plenty of blood and teeth left on the floor.”

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In all, the bill removes enhanced supervision from 25 banks that control $3.5 trillion in assets and received $48 billion in taxpayer bailouts, according to an analysis from Public Citizen.

S.2155 also changes stress tests — which check if banks can manage hazardous scenarios — for all banks, making them “periodic” (which could mean whatever regulators want it to mean, staffers say) instead of annual. So JPMorgan Chase, Wells Fargo, and Bank of America, along with literally every big bank in the country, recipients of hundreds of billions of dollars in bailouts, get assistance in this “small bank” relief bill. The stress test itself would change — at the discretion of President Donald Trump’s deregulatory army — for large regional firms.

Next, the bill rolls back protections on the mortgage market, by tweaking “safe harbor” and “qualified mortgage” provisions in ways that would allow small lenders to sell high-cost, adjustable-rate mortgages and avoid accountability in court for wrongful foreclosures. Just because a no-documentation or interest-only mortgage comes from a community bank doesn’t make it a safe financial product.

The bill also eliminates the need for appraisals in certain rural areas, creating incentives to cheat homebuyers; exempts sellers of manufactured homes like trailers from mortgage rules, which benefits the dominant player in that space, Warren Buffett’s conglomerateBerkshire Hathaway; and restricts data collection about mortgage lending that could help regulators spot the next crisis.

Finally, there’s no “consumer protection” worthy of the name in the bill. The tentpole consumer piece is a watered-down version of a recent billfrom Warren that would offer consumers stung by data breaches at credit reporting agencies like Equifax one free credit freeze and unfreeze every year. Warren’s bill would have made all credit freezes free. Even Equifax eventually offered a lifetime credit freeze, more than the authors of S.2155. And the measure preempts states from giving more generous terms to its citizens.