Cointelegraph, a news outlet covering cryptocurrency, reports that transactions on Monero, a cryptocurrency designed to guarantee anonymity, can be traceable after all. 

The obvious first takeaway is that if you're going to launder money, we're not saying you ever would, but if you are, don't use Monero. (We can hear our lawyer having a heart attack as we type this. Just to be clear: it's a joke! Don't ever launder money or indeed ever get into a position where you would have to think about whether laundering money is a good idea!) 

The serious takeaway is that something like this was always going to happen because cryptocurrency transactions are public: the whole concept of a cryptocurrency is that all transactions are recorded on a blockchain which is publicly available on the internet and that anyone can check. 

Cryptocurrency is not anonymous, it is pseudonymous, and there is a huge difference. 

This has implications for regulation of crypto, in a year where the crypto industry is spending so heavily on the campaign and on influence in DC, and some people still claim that its only or main purpose is to enable money laundering. Using a system where every transaction is recorded publicly for money laundering is obviously a very stupid idea. And if you're afraid of the pseudonymous nature of crypto, we would point out that there is another pseudonymous open source tool widely used to commit crimes: email. And it turns out that law enforcement has been quite able to use good old fashioned sleuthing and investigation to connect pseudonymous email addresses to real bad guys. 

We were heartened last week in San Francisco to talk to actors of the crypto industry who are committed to commonsense regulation to protect consumers without harming financial innovations and other capabilities of this intriguing technology. This, rather than scare-mongering, seems like the way forward. 

Policy News You Need To Know

#2024 – You should read this megathread by JD Vance on Kamala Harris's newly-released policy platform.

#Chyna – Sen. Rubio's office consistently puts out great reports. This new report on Chinese manufacturing is no exception.

#Cats #Ducks #FakeNews – Did Haitian refugees in Springfield, OH steal people's cats to eat them and kidnap ducks from public parks to eat them? Magic 8 Ball says answer unclear. Local officials deny it, and this has been deemed sufficient by legacy media to call the reports false, full stop, but it would hardly be the first time local officials deny correct bad news about their town. It does seem that the report about the cat is an unsubstantiated Facebook rumor. The truth about the duck is harder to pin down. There is a picture related to the duck allegation circulating, which turned out to be about a different town some time ago, but it seems that the duck allegation did not originate with the picture. Obviously this is all beside the point. Haiti is the most troubled nations in the Western Hemisphere and one of the most troubled in the world. Haitian dictator François “Papa Doc” Duvalier, who ruled from 1957 to 1971, had a deliberate policy of kicking out the country's educated elites as a threat to his power. Since France had no explicit laws against racial mixing (or racial laws period, though of course in practice virtually all the slaves were black Africans), even before independence Haiti had a mixed-race educated bourgeoisie. So this policy from Papa Doc, who was an overt black nationalist, had a racial as well as political and socioeconomic component. Anyway, the point is: refugees fleeing from Haiti, an incredibly violent society whose previous regime heavily selected against intelligence and bourgeois norms generally, for all that their plight elicits sympathy are, in large part, not people equipped for life in a first-world country. The way to help Haitians, which would be in the American national interest as well as humanitarian, would be to fix Haiti itself so that its inhabitants can have some semblance of a normal life. Even more to the point, flying in Haitian 20,000 refugees into a struggling working-class town of 60,000 is governmental malpractice of the highest order. One struggles to find words to describe such a policy while remaining polite. They validate the rhetoric that suggests that the people who lead us aren't just occasionally incompetent, but actively hate their own people, particularly those who live in the middle of the country, didn't go to college, and don't have the right melanin content. Everyone who is outraged is right to be outraged, and anyone who isn't ought to be ashamed.  

#CTC – EPPC's Patrick Brown has a good overview of the various CTC proposals, and asks, how big can CTC fans dream?

#AffirmativeAction – Since the Supreme Court ruling banning affirmative action, we have been waiting to see whether colleges would actually comply (and therefore show a marked shift in the racial makeup of their incoming classes this Fall) or try to come up with some workaround as they have when similar rules were passed at the state level. The WSJ has an overview of some numbers, and the short answer is “Both.” Key paragraph: “The share of Black students entering Amherst College fell to 3%, from 11% last school year. At the University of North Carolina at Chapel Hill, where students could identify themselves racially in more than one category, the percentage dropped to 7.8% from 10.5%. And at Brown University, the share of first-year domestic students who are Black fell to 9%, from 15%.”

#DEI – Speaking of, conservative activists have shown surprising success in getting corporations to distance themselves from DEI. At City Journal, Dan Morenoff explores this phenomenon.

#AI – Scary study from the MIT Media Lab: conversational AIs can and do amplify false memories.

#AI – Speaking of, DeepMind, Google's AI research lab, has come up with a new bot, AlphaProteo, who is able to generate novel proteins for biology and health research. Proteins are the building blocks of life, and they are enormously complex little molecules. Protein folding, the process of mathematically understanding how proteins are put together (drastically simplifying here), is famously one of the hardest known problems in mathematics and computer science. Since the 1990s, massive supercomputing resources have been dedicated to the problem and have only been making grindingly slow progress. AlphaProteo can design proteins to reach certain goals. The potential for advancing medicine is enormous. So is the potential for making transhumanism real. 

#AI #DynamicPricing – One AI trend that lots of big corporations are very excited by but hasn't really gotten any mainstream attention is dynamic pricing. The idea behind dynamic pricing is simple. Let's say you sell a widget for $10. Let's say Alice, your customer, would actually be willing to buy your widget for $15. If you sell it for $10, you're leaving money on the table. But selling for $15 may not be a viable solution, because Bob, who buys your widgets for $10, is not willing to pay more and would stop buying if you raised the price. Suppose corporations were able to charge each individual customer the highest price he is willing to pay? By definition, they would be maximizing profits to the utmost. Businessmen have been trying to solve this problem for generations. It is called capturing the customer surplus. Airlines have gotten famously good at it, with algorithms setting prices that change constantly depending on time of day, class, and so on. Another famous example is Microsoft, who will sell (say) “Home,”  “Small Business,” and “Enterprise” versions of essentially the same software in order to capture that customer surplus. Many corporations (and many consultants serving those corporations) believe AI could help them finally and completely crack the customer surplus problem. But one problem with that idea, as the airlines example shows, is that customers hate it. It offends their basic sense of fairness. Everyone knows the airline charges a slightly different price to everyone, and it makes us hate the airline because we never know when we buy a ticket whether we've been gouged. (Your correspondent, who is aware of airlines' notorious profitability difficulties, is somewhat sympathetic to their plight—somewhat.) All of these prolegomena by way of making you aware that a left-wing pressure group, More Perfect Union, has run an experiment and found that Uber and Lyft pay different drivers different prices for the same ride. Now, prices in the marketplace for goods and services is one thing. But prices in the labor market are another thing altogether, for both political and legal reasons. The point is this: dynamic pricing offends people's basic sense of fairness, and if corporations go too far with it, they will face a political backlash. Caveat venditor...

#K12 #Microschools – Enabled by school choice policies, the microschool movement is gaining steam, and it's one of the most exciting trends in education today. It's just what it sounds like: tiny schools, often parent-operated, with just a handful of students. The potential for flexibility as opposed to bureaucracy and personal attention for the kids is great. Here's an overview of what a microschool is like.