The crypto thread

[Kyriakos]

I do not think it is clear that making an NFT of something is a "copyright-dependent thing". It is not obviously a derivative work, and do not usually come with copy rights.

Another issue with copyright is that (originally) they claimed they would be using the Dune script/concept art book to create a tv series.
I really don't think they were just being dumb, more than likely it was a calculated scam to lure in crypto^dune fans and rid them of their money.

 

[gangleri2001]

 

[Samson]

The US National Institute of Standards and Technology (NIST) came up with a list of recommended algorithms that should be protected against quantum computers, which do not yet really exist. It seems they forgot about making them resistant to normal computers.

The Supersingular Isogeny Key Encapsulation (SIKE) algorithm was chosen by NIST just last month as a candidate for standardization, meaning it advanced to an extra round of testing en route to adoption.​

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Within SIKE lies a public key encryption algorithm and a key encapsulated mechanism, each instantiated with four parameter sets: SIKEp434, SIKEp503, SIKEp610 and SIKEp751.​

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Belgian boffins Wouter Castryck and Thomas Decru claim to have cracked it:​

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"Ran on a single core, the appended Magma code breaks the Microsoft SIKE challenges $IKEp182 and $IKEp217 in about 4 minutes and 6 minutes, respectively. A run on the SIKEp434 parameters, previously believed to meet NIST's quantum security level 1, took about 62 minutes, again on a single core," wrote Castryck and Decru, of Katholieke Universiteit Leuven (KU Leuven ) in a a preliminary article [PDF] announcing their discovery.​

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The authors made their code public, as well as the details of their processor: an Intel Xeon CPU E5-2630v2 at 2.60GHz. That bit of kit was launched in Q3 2013, used Intel's Ivy Bridge architecture and a 22nm manufacturing process. The chip offered six cores – not that five of them were in any way encumbered by this challenge.​

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"The attack exploits the fact that SIDH has auxiliary points and that the degree of the secret isogeny is known. The auxiliary points in SIDH have always been an annoyance and a potential weakness, and they have been exploited for fault attacks, the GPST adaptive attack, torsion point attacks, etc." argued University of Auckland mathematician Stephen Galbraith in his cryptography blog.​

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The math gets cerebral, and Galbraith suggests if you really want to understand it, you need to study Richelot isogenies and abelian surfaces. Good luck with that.​

 

[Samson]

US criminalises open source code, Netherlands arrests developer

“In an effort to punish hackers and cybercriminals, Treasury just made a clumsy attempt to sanction Tornado.cash, an open source protocol. Tornado.cash was a mixing protocol that worked by letting many people send Ethereum to a specific address, mixing all the cryptocurrency it holds together, then letting those who had sent funds withdraw better-anonymized money. Services like Tornado.cash exist because the permanent, public, and immutable records kept on blockchains like Ethereum aren’t inherently privacy-preserving. But after Treasury’s actions, the open source code used to run this protocol has been censored, and developers contributing to the protocol are reporting that their GitHub accounts have been deleted.​

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Let us be clear, hackers and cybercriminals, as well as those that support them, are deplorable and should be stopped—but not in a way that compromises human rights and the first amendment.​

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Treasury’s sanctions were meant first as a tire-slash to the Lazarus Group, cyberthieves affiliated with North Korea, who used Tornado.cash to anonymise stolen Ethereum, and prevent them (and, it seems, anyone else who was using it) from being able to withdraw from the service anonymously.​

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It also seems that Treasury’s sanctions were meant as a warning shot to projects attempting to build anonymous digital assets, and an attack on the first amendment right to code.​

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Treasury did not only sanction the individuals or corporations involved with the Lazarus Group; they sanctioned all the mechanisms—ethereum addresses—by which the Tornado.cash protocol provides its blending service, because that service was used by bad actors. This is a rough equivalent to sanctioning the email protocol in the early days of the internet, with the justification that email is often used to facilitate phishing attacks. Tornado.cash is code, and rather than identify those who were aiding and abetting criminals the Treasury simply sanctioned that code. Code is speech.​

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Already, the Internet is feeling the chilling effects of this choice: the open source code used to run Tornado.cash has been taken down from Github. And unfortunately it seems that such an effect is exactly what the US government was seeking.​

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In yesterday’s press release announcing sanctions against Tornado.cash, Treasury states clearly that “while most virtual currency activity is licit, it can be used for illicit activity”—essentially a statement that could be made about cash. But as Politico reports “The Biden administration wants cryptocurrency companies to voluntarily adopt internationally agreed-upon technologies for combating money laundering, including collecting all users’ personal information. The senior Treasury official said the sanctions on Tornado Cash would send a strong message to companies that still haven’t done this.” (Bolded emphasis is our own.)​

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Anonymity is not a crime, and there are many legitimate reasons to seek anonymity in financial transactions. Privacy tools are important to, for example, activists in authoritarian states where revealing financial information could get someone jailed or executed. Anonymity, particularly financial, may soon become essential for pregnant people seeking abortions in the US, as well as supporters in states that criminalize donations to abortion funds or Planned Parenthood. Simply not wanting your financial history surveilled by governments, corporations, stalkers, or other bad actors is a legitimate reason to seek privacy-preserving technologies online.​

 

[Samson]

And now we find out if code is speech: Banned Tornado Cash code reuploaded to GitHub in free speech test

Based on its interpretation of [the OFAC] sanctions, Microsoft-owned GitHub shut down the user accounts of three individuals who contributed code to the project and removed the Tornado Cash account along with the source code in the repository.​

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Forks of the open source Tornado Cash software have remained on GitHub and on Monday, Matthew Green, a cryptography professor at Johns Hopkins University, published another fork of the software with the support of the Electronic Frontier Foundation (EFF).​

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Green says the fork he published exists to test whether code removal is ever the appropriate response to sanctions. He says that if GitHub takes the code down, the EFF will challenge that decision in court.​

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"In my work as a researcher and instructor at Johns Hopkins, I've made extensive use of the Tornado Cash and Tornado Nova source code to teach concepts related to cryptocurrency privacy and zero-knowledge technology," Green wrote in an explanatory note on his tornado-repositories repo.​

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"My students have built amazing projects from the code. The loss or decreased availability of this source code will be harmful to the scientific and technical communities."​

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As the EFF explains in a blog post, the OFAC refers to "Tornado Cash" both as a technology and a sanctioned entity. It's the name of the open source project published to GitHub account, of a smart contract application running autonomously on the Ethereum blockchain, a website, and some set of people involved with making the currency-mixing software.​

 

[uppi]

And now we find out if code is speech: Banned Tornado Cash code reuploaded to GitHub in free speech test

Based on its interpretation of [the OFAC] sanctions, Microsoft-owned GitHub shut down the user accounts of three individuals who contributed code to the project and removed the Tornado Cash account along with the source code in the repository.​

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Forks of the open source Tornado Cash software have remained on GitHub and on Monday, Matthew Green, a cryptography professor at Johns Hopkins University, published another fork of the software with the support of the Electronic Frontier Foundation (EFF).​

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Green says the fork he published exists to test whether code removal is ever the appropriate response to sanctions. He says that if GitHub takes the code down, the EFF will challenge that decision in court.​

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"In my work as a researcher and instructor at Johns Hopkins, I've made extensive use of the Tornado Cash and Tornado Nova source code to teach concepts related to cryptocurrency privacy and zero-knowledge technology," Green wrote in an explanatory note on his tornado-repositories repo.​

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"My students have built amazing projects from the code. The loss or decreased availability of this source code will be harmful to the scientific and technical communities."​

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As the EFF explains in a blog post, the OFAC refers to "Tornado Cash" both as a technology and a sanctioned entity. It's the name of the open source project published to GitHub account, of a smart contract application running autonomously on the Ethereum blockchain, a website, and some set of people involved with making the currency-mixing software.​

Maybe I am missing something, but how does free speech apply to a private company?

 

[innonimatu]

US criminalises open source code, Netherlands arrests developer

“In an effort to punish hackers and cybercriminals, Treasury just made a clumsy attempt to sanction Tornado.cash, an open source protocol. Tornado.cash was a mixing protocol that worked by letting many people send Ethereum to a specific address, mixing all the cryptocurrency it holds together, then letting those who had sent funds withdraw better-anonymized money. Services like Tornado.cash exist because the permanent, public, and immutable records kept on blockchains like Ethereum aren’t inherently privacy-preserving. But after Treasury’s actions, the open source code used to run this protocol has been censored, and developers contributing to the protocol are reporting that their GitHub accounts have been deleted.​

...​

Anonymity is not a crime, and there are many legitimate reasons to seek anonymity in financial transactions. Privacy tools are important to, for example, activists in authoritarian states where revealing financial information could get someone jailed or executed. Anonymity, particularly financial, may soon become essential for pregnant people seeking abortions in the US, as well as supporters in states that criminalize donations to abortion funds or Planned Parenthood. Simply not wanting your financial history surveilled by governments, corporations, stalkers, or other bad actors is a legitimate reason to seek privacy-preserving technologies online.​

There is no anonymity in this cryptoccrap. It's specifically programmed to retain a history. Arguably it can be promoted as an honeypot.

Cash is anonymous. More, it's fungible and therefore impossible to block on use. Digital "currencies" are the opposite: completely traceable and possible to block for chosen targets. The kind of people who have wet dreams about controlling everyone (lese) have been salivating at replacing cash with "digital currency".

No service built on top of a protocol with built-in spying and tracing changes that. The whole thing is rotten.

 

[Samson]

Maybe I am missing something, but how does free speech apply to a private company?

My reading was that "challenge that decision in court" was "find the law that requires them to take it down unconstitutional", but I am not at all sure.

There is no anonymity in this cryptoccrap. It's specifically programmed to retain a history. Arguably it can be promoted as an honeypot.

Cash is anonymous. More, it's fungible and therefore impossible to block on use. Digital "currencies" are the opposite: completely traceable and possible to block for chosen targets. The kind of people who have wet dreams about controlling everyone (lese) have been salivating at replacing cash with "digital currency".

No service built on top of a protocol with built-in spying and tracing changes that. The whole thing is rotten.

It seems like Tornado.cash works. People transfer ethereum there and do not get caught by law enforcement. If it did not work then it would not have been a target. Also Monero seems to work.

 

[innonimatu]

My reading was that "challenge that decision in court" was "find the law that requires them to take it down unconstitutional", but I am not at all sure.

It seems like Tornado.cash works. People transfer ethereum there and do not get caught by law enforcement. If it did not work then it would not have been a target. Also Monero seems to work.

I think the US government is sanctioning/blocking something worth blocking, for a change.
For two reasons: one, these "mixers" are indeed tools used mostly by criminals, and two, the give the illusion of privacy but can be defeated by someone willing to put in the effort.

What happens is that criminal investigations typically do not have that many resources available. This discourages (for a while, until defeating this becomes common knowledge and tools are built and published) criminal investigations. On the other hand someone seriously seeking privacy from well-resourced institutions will find no use in these protocols.
It's exactly like the early use of bitcoin by criminals. It seemed complex, and police often gave up, didn't even attempt to pick the traces through the chain and correlate transactions until one gave away the criminal's identity. Then tools to do that became more common. So this new layer of obfuscation gets put, and soon new tools make it easy to defeat it.

Its a false promise of privacy. And one that benefits criminals with short-term goals, not the oppressed or censored. Those need real privacy, not a temporary way to discourage investigators.

 

[Samson]

Hacktivists make NFTs out of the stolen passports of Belarusian officials

A hacktivist group calling themselves the Belarusian Cyber Partisans managed to gain access to the entire passport records of Belarus last year. On August 30, they began selling NFTs created from the passport data of various Belarusian officials, including the country's authoritarian president, Alexander Lukashenko. Other passports include those of the head of the Belarusian KGB, Lukashenko's press secretary, and the country's prime minister.​

The group is selling the NFTs for between 0.2 and 6.5 ETH ($300–$9,700), and say that all proceeds will go towards "our work in hitting bloody regimes in minsk & moscow".​

 

[Samson]

For anyone who thought Tornado cash had no legitimate uses:

Russian authorities arrest journalist who donated $16 to dissident group via crypto​

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Although people commonly argue that privately donating to dissidents is a compelling use case for cryptocurrency, reality has shown us some of the major flaws with it. According to the Associated Press, Russian authorities charged the independent journalist Andrei Zayakin with funding an extremist group after he donated 1,000 rubles (around $16) to an organization created by Russian opposition leader Alexei Navalny. He was reportedly arrested on August 28 and charged the following day, and faces up to eight years imprisonment if convicted.​

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In April, Reuters reported that Binance supplied the Putin regime with information on those who donated to Navalny, but the AP have not suggested that that was how authorities decided to target Zayakin.​

 

[Samson]

Annual Income From Crypto Mining With Associated Gas in Russia to Exceed One Billion Rubles

Data centers mining cryptocurrencies in Russia’s oil fields have a combined power rating of 85 megawatts, which is 23% of the market, according to analysts at Vygon Consulting, an independent consultancy working on the development of the Russian fuel and energy complex.​

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These crypto farms are supplied with electricity generated by small power plants burning associated petroleum gas (APG), a by-product of the extraction of black gold, that oil companies are required to dispose of. While it costs them almost nothing, they can sell it to miners.​

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Russian oil producers use around 17 billion cubic meters of APG annually to power facilities at drilling sites. Researchers say cryptocurrency mining accounts for 279 million cubic meters of consumption at the moment, the Russian business daily Kommersant reported, quoting the study conducted by Vygon Consulting.​

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In July alone, the earnings of APG miners amounted to 400 million rubles (approx. $6.6 million), calculated at a monthly average exchange rate of $20,000 per 1 BTC. Their projected annual revenue for July 2022 – July 2023 at that bitcoin price is 4.8 billion rubles (close to $79 million) and the annual income for a six-year period could reach 1.16 billion rubles ($19 million).​

 

[El_Machinae]

That was discussed upthread!

It's a good way of turning something being wasted (they flare it) into liquid capital which can then be put into local infrastructure to build capacity. Insofar as people want crypto, this uses that demand to create local investments

 

[Samson]

Islamic State tests out NFTs

In the apparent "first known nonfungible token created and disseminated by a terrorist sympathizer", a supporter of the Islamic State has minted an NFT with a message praising an attack on a mosque in Kabul, Afghanistan. According to former U.S. intelligence officials cited by The Wall Street Journal (paywalled) the NFT is likely an experiment with new funding and channels for propaganda.​

The token was briefly listed on OpenSea, Rarible, and various other marketplaces before those marketplaces took it down. However, because it was minted on the blockchain, the token itself cannot be removed. "It's very much an experiment...to find ways to make content indestructible," said Raphael Gluck, a co-founder of a jihadist research group.​

 

[Samson]

US treasury sued over Tornado Cash sanctions

In the wake of OFAC adding Tornado Cash to the U.S. sanctions list in early August, Coinbase has announced they will fund a lawsuit against the Treasury Department to challenge the decision. Coinbase itself is not a plaintiff in a lawsuit, though two of the plaintiffs are Coinbase employees, who along with four other individuals filed suit in a Texas court. They say they previously used Tornado Cash for licit purposes, and are now suffering financial damages because they can't legally use the service.​

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In the suit, they argue that the Treasury Department overstepped its authority in what it can sanction, claiming that "Tornado Cash software, including the smart contracts, consists of immutable open-source software code, which is not property, a foreign country or a national thereof, or a person of any kind." They've also argued that the designation is unconstitutional under both the free speech protections of the First Amendment and the due process protections of the Fifth Amendment.​

 

[Samson]

NFT's made to celebrate queenies passing

I do not know why NFT's need to be of such bad pictures.

 

[Aiken_Drumn]

I'll leave the adults in the room to wonder why, but evidence I paid £40 for something in 2014.. How much that has been over the years since...

 

[Samson]

The Ethereum Merge Is Done, Opening a New Era for the Second-Biggest Blockchain

So etherium is no longer proof of work, and is proof of stake. This means its CO2 footprint is quite modest, lower than lots of stuff we do and a tiny fraction of streaming services. However now the rich can buy all the ether and control the system. I do not know enough about it all, but sacrificing security and decentralisation for a habitable planet sounds like a good deal to me.

The massive overhaul of Ethereum known as the Merge has finally happened, moving the digital machinery at the core of the second-largest cryptocurrency by market value to a vastly more energy-efficient system after years of development and delay.​

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It was no small feat swapping out one way of running a blockchain, known as proof-of-work, for another, called proof-of-stake. “The metaphor that I use is this idea of switching out an engine from a running car,” said Justin Drake, a researcher at the non-profit Ethereum Foundation who spoke to CoinDesk before the Merge happened.​

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The payoff is potentially gigantic. Ethereum should now consume 99.9% or so less energy. It's like Finland has suddenly shut off its power grid, according to one estimate.​

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Ethereum’s developers say the upgrade will make the network – which houses a $60 billion ecosystem of cryptocurrency exchanges, lending companies, non-fungible token (NFT) marketplaces and other apps – more secure and scalable, too.​

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The update’s complexity was compounded by the fact that it may have been one of the largest open-source software endeavors in history, requiring coordination across dozens of teams and scores of individual researchers, developers and volunteers.​

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Tim Beiko, an Ethereum Foundation developer who played a key role in coordinating the update, said to CoinDesk, “I think the Merge can genuinely get those people who were interested in Ethereum, but skeptical of the environmental impacts, to come and experiment with it.”​

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Not everyone buys into the proof-of-stake hype. There are no signs that Bitcoin, for instance, will ever abandon proof-of-work – which proponents insist remains the more battle-tested and secure system.​

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And although control of the Ethereum network will no longer be concentrated in the hands of a few publicly traded mining syndicates, critics insist that old power players will just be replaced by new ones. Lido, a kind of community-run validator collective, controls over 30% of the stake on Ethereum’s proof-of-stake chain. Coinbase, Kraken and Binance – three of the largest crypto exchanges – own another 30% of the network’s stake.​

 

[Samson]

Which is worse, burning a globally significant piece of art or scamming people in the name of children's charity?

A businessman has published a video in which he burns a drawing that he claims is an original Frida Kahlo drawing worth more than $10 million—though its value and its authenticity have both been questioned. The entrepreneur created 10,000 NFTs from the drawing, which he's selling for 3 ETH (~$4,000) (reduced from the original 3.5 ETH/$4,700) for a hoped total of $40 million. He claims that in burning the artwork, he has "transitioned [it] into the Metaverse".​

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So far, the stunt has resulted in two NFTs being minted by outside parties, for total proceeds of 7 ETH (~$9,400) – not quite the millions the drawing allegedly cost the NFT project creator. Meanwhile, Mexican authorities have said they are investigating whether the businessman committed a crime in intentionally damaging an artistic monument.​

Mobarak has promised that a portion of the proceeds from the NFT sales will go to organizations supporting battered women and children with autism, as well as prominent Mexican art institutions, including the Frida Kahlo museum. Whether they will accept his money is another question—Mexico’s National Institute of Fine Arts and Literature said on Tuesday that it would not and that it’s investigating whether the drawing Mobarak burned was an original.​

Spoiler The event on youtube Skip to 2:10 to see fire :

 

[gangleri2001]

I'll leave the adults in the room to wonder why, but evidence I paid £40 for something in 2014.. How much that has been over the years since...

According to the exchange rate at the moment of writing this, 0.1959 BTC are now £3377.24

Not bad at all for an initial investment of £46.73