Biz Builder Mike

You can't sail Today's boat on Yesterdays wind - Michael Noel

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Mark Cuban Names Million-Dollar BTC Price as Condition for Presidential Run

In an era where business people can achieve incredible power on the political scene, many have pointed towards a possible presidential run for billionaire investor Mark Cuban. This week, Cuban eventually leaned into the talks, explaining that he would only make a run for the White House when Bitcoin crosses $1 million.

Big Bitcoin Jump to Propel President Cuban

Cuban made the admission in a Twitter conversation with Chamath Palihapitiya, a fellow billionaire, and the chief executive at venture capital firm Social Capital. Palihapitiya had tweeted about the fault in the American political system, which is primarily split between two large political parties. Replying to his call for a viable third party in 2030, Cuban asked why political parties are even needed to take the White House in the first place.

Palihapitiya followed up with a tweet asking if Cuban would run, and the Dallas Mavericks owner laid out his requirements. Cuban replied:

“I’ll run if BTC gets to $1m AND we can get commitments to donate 350 BTC to the Treasury each of the 4 yrs so that we can give 1 satoshi to every citizen each yr, that they must hold for 10 years. How’s that sound”

The proposition seemed both plausible and acceptable to Palihapitiya, who hinted that Cuban should be gearing up for his presidential run by 2024.

Possible, but Challenging

Cuban’s latest tweet appears to be another show of his reluctant support for Bitcoin. The investor has long been a critic of the asset, claiming on several occasions that it doesn’t have any real value. Despite his criticism, however, Cuban has also been quick to point out some particular benefits of Bitcoin.

In a tweet from last month, Cuban pointed out that public companies should take a cue from Bitcoin and never issue new stocks again. The billionaire appeared to have been referencing Bitcoin’s monetary policy, which hinges on a capped monetary supply – a mechanism for effectively preventing possible inflation.

Still, it begs the question of how the hypothetical Cuban administration will plan to distribute satoshis to every American. The billionaire himself has called for Bitcoin to be simpler to understand and use, claiming last year that one of the primary inhibitors of the asset’s growth is a lack of understanding from mainstream investors. 

As for his proposition concerning Bitcoin’s valuation, Cuban also appears to be stating his belief that the leading cryptocurrency will make significant gains in the near future. In just five weeks, Bitcoin has managed to gain over $20,000 in value. $1 million soon might seem like a long shot, but with the market on an unprecedented run, nothing looks so impossible anymore.

Palihapitiya definitely sees the potential, with his reply showing his belief that Bitcoin will be valued at $1 million by the time campaign trails start to open again. If all these hold up, Donald Trump might not be the only modern-day billionaire to become the leader of the free world.

Mark Cuban Names Million-Dollar BTC Price as Condition for Presidential Run

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IRS to transition from ‘education to enforcement’, says former division chief

A former top investigator is warning that “a high-stakes game of chicken” between the Internal Revenue Service (IRS) and cryptocurrency holders who fail to properly report their earnings will be entering a new phase in 2021 as the tax collection agency begins to focus on pursuing “civil and, potentially, criminal penalties.”

In an article co-authored by Don Fort today, the former chief of the Internal Revenue Service’s (IRS) criminal investigation division said that while the agency until now has focused its resources on informing the public of proper reporting guidelines, it will now be turning to more stringent “enforcement.”

“The IRS has been not-so-quietly positioning itself for a smooth transition from education to enforcement in 2021 and beyond.”

The article notes that the trail starts with Coinbase, who answered a “John Doe” summons in 2018 and handed over account information on nearly 13,000 users — information which could soon lead to crackdowns. For instance, the article mentions the request the IRS made to Luxembourg-based exchange Bitstamp for information on one American user.

The focus on crypto holders is in part due to a widening “tax gap” — the rift between the total income from taxes that should be paid to the Treasury verses what it actually receives — a disconnect in which Fort and his co-author Lawrence Sannicandro believe crypto holders could be playing a major part.

“As of Dec. 10, with Bitcoin fresh off new record highs, the market capitalization of cryptocurrencies was $524 billion,” the article reads. “Assuming cryptocurrency-related tax liabilities of $25 billion and a 50% compliance rate, unreported cryptocurrency tax liabilities again account for around 3.2% of the $381 billion tax gap. Thus, it is likely that unreported taxable cryptocurrency transactions are contributing significantly to the tax gap.”

Ultimately, the article concludes that major trends — such as the addition of a question about cryptocurrency now prominently placed at the top of form 1040 — indicate that the IRS is gearing up for widespread efforts to root out underpayment.

“Even though the IRS has not yet announced many mainstream tax evasion or money laundering cases involving virtual currency, that trend should change in 2021.”

Moreover, crypto holders shouldn’t try to get cute when the tax man comes calling.

“History has shown that underestimating the government is a fool’s game.”

IRS to transition from ‘education to enforcement’, says former division chief

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Bitcoin Analyst Argues that BTC Mining Is Not Wasteful, but Rather an Efficient Process to Secure a Highly Valuable Network

As Bitcoin (BTC) continues to set new highs, it became clear to many people that the digital asset could serve as a hedge against the traditional financial system. This year, many well-known investors, including Stanley Druckenmiller (a hedge fund manager with a net worth of $4.4 billion) have changed their mind about Bitcoin in the current macro-economic environment.

Druckenmiller thinks Bitcoin could serve as a hedge against US dollar depreciation and the ever-rising American stock market.

Sampo, a Bitcoin analyst, points out that stil, “not everyone has changed their mind, though, and the seemingly ever-present nay-sayers are also back.” They note that a popular or common argument against BTC is that it wastes too much energy. Although it’s true that mining BTC (or other proof of work cryptos) requires a very large amount of electricity, “the argument that it is a waste of energy has been debunked,” Sampo (a guest author/analyst) writes in a blog post published by LocalBitcoins.

According to Sampo, Bitcoin is “the ultimate cost-efficient way to spend electricity, and … [crypto] mining minimizes wasted energy and increases the use of sustainable energy solutions.”

At present, 900 new Bitcoins are created each day or every 24 hours. New Bitcoins are minted by using computing power to solve very complex mathematical problems. This requires large amounts of electricity. In fact, the total energy consumption of the BTC network is about 77 terawatt-hours (at the time of writing). This is even more than the total energy consumption of developed nations like Switzerland and the Czech Republic, Sampo confirms.

But since the total value of the BTC network has now surpassed the “total value of most major banks,” it’s clear that “a lot of energy is needed to secure the network,” Sampo claims.  They argue that “all this immense energy is used to secure the safest value network ever created [so] it’s not wasted.”

Sampo further noted that “in practice, what it means to secure the Bitcoin network [is that] new bitcoins are created by validating blocks, which also contain the transaction information of all transactions on the Bitcoin network.” At the beginning, when the genesis block was mined, this “could be done with computer processors, CPUs,” Sampo notes.

But GPUs (graphics processing units in PCs) were a lot more efficient in solving the mathematical equations. And after the BTC network gained a lot more recognition, and Bitcoin acquired more value, hardware companies began producing ASICs – which are “optimized to solve the equations involved in mining Bitcoin,” Sampo explained.

GPUs may still be used for mining purposes, however, it’s quite difficult or even impossible to do it “profitably as an individual,” Sampo notes. They confirm that the process was “commercialized and optimized years ago.”

They added that the total hash rate of the BTC network is around 131.791 TH/s – which is an “immense amount of computing power protecting the network from outside attacks since any significant threats would require 51%, the majority of the hashing power, to force changes into the network.”

Sampo compares this to the hash rate of a typical gaming PC. They point out that “this is all very hypothetical, but let’s say that the potential hash rate of a low to mid-tier PC is approximately 23 MH/s.” Then “dedicating the GPU of this PC to bitcoin mining would account for 0.000017% of the current total hash rate of the Bitcoin network.”

Using these numbers, of the 900 new Bitcoins, “the daily share of this setup would amount to 0.000153 bitcoin, or 15,300 satoshis, currently worth $3.60.” When we “reduce the mining pool fees and the price of the electricity needed for running the PC 24/7, [then we can see that] this operation would be unprofitable.” More than likely, this setup would never be able to recover the initial investment.

This suggests that mining might be possible for individuals, however, it may not be profitable. But we can also see that a massive amount of energy consumed “protects the network” and “profitable mining requires optimal hardware, and optimal mining conditions,” Sampo states.

They added:

“Optimized hardware equals optimized returns. Cheap electricity prices equal optimized returns. When these two conditions are met, an optimal environment for Bitcoin mining is created, and Bitcoin mining incentivizes electricity users to minimize wasted energy. In other words, the game theory of Bitcoin mining eliminates actors who waste energy….mining favors countries with cheap electricity which usually equates to countries that are struggling financially, such as Venezuela. Unfortunately for Venezuelans, the industry has recently been forced into the national pool and even the Venezuelan army has started mining bitcoin.”

Sampo argues that if it were a waste of energy, then “why would governments do it?”

They further noted:

“Mining bitcoin is not only for countries where cheap electricity is available everywhere. Cheap electricity sources exist all around the globe, and they are the future trend in bitcoin mining. …oil and gas fields are using their excess energy to mine Bitcoin. This way, they can reduce their carbon footprint by utilizing the previously wasted energy. The same is true for hydropower plants and since renewable energy is an inexhaustible source of energy, these solutions have huge potential in powering the Bitcoin network in the future.”

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Paysend Welcomes More Than 150,000 New U.S. Customers in the Past Three Months Alone

Paysend, a UK-based global payments platform, announced on Tuesday more than 150,000 net new U.S.-based customers have used its platform during the last three months alone to send digital money transfers across borders. Paysend reported that following its stateside launch in September amidst the pandemic, it experienced a 25% increase in U.S. outbound transfer activity between September and October.

“This rapid growth occurred as American residents, including large populations of immigrants, expatriates and foreign exchange students, adopted the platform to securely transfer funds to international accounts located across more than 70 countries in minutes — without visiting a physical bank location.”

Speaking about the milestone, Matt Montes, Paysend’s U.S.-based General Manager, stated:

“Paysend’s platform fills the void that has long existed in America for a low-cost, convenient method to send money abroad, without charging the erroneous fees that have become synonymous with traditional transfer methods. As a result of our record new user adoption rate, we’ve grown Paysend’s U.S.-based team, and we will announce strategic partnerships with global payment partners in 2021 to offer even more features that enable American citizens and visitors alike to connect with loved ones via safe and secure international money transfers.”

Paysend CEO, Ronald Millar, added:

“During times of uncertainty, individuals in emerging economies are even more reliant on fast and affordable cross-border payments from those in the United States. Digital transfers offer a much-needed alternative to traditional money exchange methods. Since the start of the global pandemic, more than one million new global users have joined Paysend’s platform to send money to friends and family around the world. Our successful entry into the U.S. market in Q3 is certainly helping to fuel our global momentum.”

Founded in 2017, Paysend is the global fintech company and payments disruptor based in the UK. It is on a mission to change how money is moved around the world.

“We are the next generation money transfer platform allowing you to send funds from card to card from 45 to over 80 countries.”

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Singer Akon Plans $6 Billion Futuristic City In Senegal

Senegalese-born American singer Akon is planning to build a smart city in Senegal. The project, which is estimated to cost about $6 billion, will be built on a 2,000-acre futuristic metropolis. The smart city, called “Real-Life” Wakanda, will contain an artificial-intelligence data center, a stadium, a hospital, offices, condos, and a luxury resort. Residents in the city will be paying for any service via the singer’s cryptocurrency called Akoin.

The project will be heavily funded by a Kenyan entrepreneur who has had a history of the alleged fraud.

Empowering youths in Africa

While unveiling plans for the project, Akon said when the project is complete, it will empower African youths. Although there have been few details about the project that have been released so far, an architect from Dubai and a Los Angeles construction firm have already been contacted for the Akon City project.

There’s no doubt that Akon has become has reined in the American music industry for years now. But the multiple award-winning singer is now pursuing other things and doesn’t want his legacy to remain only in music.

“One of my biggest fears was just being known for singing and dancing,” Akon told Business Insider during a call.

Although the singer’s songs may no longer be the anthem as they used to be, Akon has not been idle. He has been very active in other projects and has now become a tech entrepreneur in Africa.

He started with a solar power company before buying a diamond mine in South Africa. Akon has also launched his Akoin cryptocurrency, which will be the sole transaction enabler when Akon city goes live. The 2,000-acre futuristic city will be designed to serve as a business hub and will be filled with gleaming palm trees and skyscrapers. The plan will allow residents to pay for taxes, business licenses, as well as basic utilities using the Akoin cryptocurrency.

Akon said he’s not going to stop just with this smart city, as there is a plan to build similar smart cities in other parts of Africa.

The cost of the project clearly shows that Akon alone is not providing the entire financial outlay for the project. According to an estimate by the BBC in 2018, Akon’s net worth is around $80 million. The bulk of the funds will be coming from the Kenyan investor, while Akon will make his Akoin cryptocurrency the sole medium of exchange.

Singer Akon Plans $6 Billion Futuristic City In Senegal

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