Predicting Cryptocurrencies

My naive analysis of cryptocurrencies based on the publicly available data (historic price of the major coins) inferred four key parameters to model a typical crash:

– The magnitude of the latest bubble.
– Length of the inflation period.
– The speed of deflation measured by the powerlaw exponent of the decay curve.
– The length of the deflation period.

On the flight back from New York City (have to look up the date but it was early January this year) looking at the 11 major crashes in the history of cryptos, the rather simple model predicted that:

The market may crash at any moment. (It did in a week, but could go on a little longer too).

And that at the current market cap ($800B at the time) a following crash will, in a period of 6 months to one year:
– Deflate to a market cap of $150B for all cryptos.
– 4,500$ for Bitcoin (17,000$ at the time)
– 200$ for Ethereum (1,200$ at the time)

And I said I will chip in when two of the three goals are met.

So far (9 months through) one of the three has taken place (Ethereum hit 170$ yesterday).

You’re welcome!

Facebook and the world domination

Dino

Instagram app has updated its data policy. It is not yet rolled out to their website so I can link, but I urge you to read it once you soon get the notification:

They are being upfront about how much data they collect, and implictly admit that they have your shadow profile, even if you don’t have a Facebook account.

Which is a double-edged knife; Not only it’s an honest gesture, it will also make you give up quitting their service, cause of course, they see you anyhow even if you haven’t made an account at the first place.

It is smartly drafted and clearly technical experts, lawyers and psychologists are involved.

They have listed many different types of raw data they collect (“data categories”, as a congresswoman called it), but don’t say what this data can be used for. What other information about us can be inferred from processing such raw data – how much this data can tell about us – is inconcievable for most of us. Cambridge Analytica was the tip of an iceberg.

Facebook among many other giants are closing on to the level of a super-organism mapping the real world of social and physical connections, and yet conveying that you can not escape this system so just try to get along and live with it.

While we should be aware how such level of knowledge can be used to manipulate us or others against us – simply for profit and at any costs, simply how capitlaism’s metrics work – we should know that this is yet another stage of our evolution.

As the Internet made the infrastructure available for many codes to quickly evolve and dominate, no *beta* version of any code, no early form of DNA for any superorganism lasts so long.

* * *

The forementioned data policy shows that Facebook has not given up on its self-destructive greed, and is covertly following its growth patterns of move fast and break things. Facebook might have gotten away with this challange this time around, and could also possibly come to an agreement with lawmakers and politicians to let them safely keep on going with their endless domination agenda.

Although, I am sure this super-organism is not aware of things that some of its cells are, and even its CEO could not process such information better than some of us.

That – in a nutshell – how exactly in the face of environmental pressures the big can fail faster:

When the large asteroid hit the earth 65 million years ago, it was the gigantic dinaseurs who went extinct. So Facebook may want to give a little budget from their lawyers and psychologists to hire an ecologist or an evolutionary biologist, to help them take note and learn why it happened to those giant super-advanced reptiles, who were once inarguably on top of the food chain. And how tiny shrews took the chance in such a chaos to dominate the scenery and kickstarted new generation of mammals taking the game to the next level.

My note from two and a half years ago on the topic:

Facebook will die

Ethernal AI dictatorship

Elon Musk is right.

And humans are already slaves of some self-organized technological super-intelligence, made of flesh and sillicon. It’s just many of them out there fighting over us as resrources and the evolutionary battle hasn’t been settled just yet.

So let me reflect on these doomsdays scenarios:

I think we tend to undermine the algorithmic nature of the world, and so the wide variety of scopes and the vast magnitudes of scales that the so-called *evolution* can rule, beyond biology.

It’s an old story. Trees made us to be their polinating agents and we cut them down. We made AI and it will enslave us.

So he is right. But this doomsday scenario isn’t like a Terminator story.

A ‘god-like’ AI is a true threat. But it doesn’t need to be a robot, a super computer, or a conventional AI.

These god-like creatures have algorithmic nature, similar to AI. So let’s talk about that instead.

First of all, algorithms don’t run in a methaphysical space sperated from our world. Algorithms need *stuff* to run on; They need flesh and sillicon. Also they were not invented by humans with the digital computers. They have been around for a long long time.

The truth is, we are already slaves of self-organized algorithmic beings higher than ourselves. The technological end legal entities that interact with each other and the machinery of our civilization for example. These super organisms beyond any individual’s power have evolved an order and dictate what we should do. They rule us, own us, embed and encompass us; We are like cells in their bodies.

What are exactly these algorithmic super-organisms? Very difficult to pin point.

If we can spot and name them, we would still view them as vague concepts entangled with each other like a spaghetti, rather than detached phsyical objects. I don’t think from our perspective we can define these super-organisms as separate entities like the conventional organisms that we know, but that doesn’t make them any less real. Perhaps we can, with our limited understandings, identify some of them that are somewhat immediately built by us: organizations, nation-states, political parties or corporates. But there is much more complexity that goes above our heads when we include all the algorithmic functionalities within and in between them.

It is really these entities who make wars, invent alphabet, or send objects to Mars, not our individual leaders, inventors or visionaries. They have habits and patterns like our personality traits, and one may say we made science as an endeaver to understand those patterns and traits.

These algorithmic gods and masters are beyond our understanding as we are beyond our cells. We are just a small part of them. And they are intelligent too. More than us or less, is difficult to tell. They are operating at different scales and deal with different problems for the survival of their code. Are we more intelligent than our cells? What about the cancerous ones? If so how one of them can kill us?

I think we already are slaves of some god-like beings that are in their infancies and are co-evolving with us. And it shouldn’t be surprising if their greed for domination and survival as their emergent property, tend to accelerate out of our control and if we find ourselves captured in a deterministic ordered that we built together, while there is no way out.

We have experienced this situation before. With the idols, commandments, money, cities and legal systems we have previously made codes that became stronger than us. These codes are already our masters, exhibiting recognizable patterns taking us to wars and situations beyond the decisions of any CEO, king or emperror.

And I think of AI threat along the same lines, only on steroid. AI is scary because it runs on increasingly faster platforms and can accelarate since it may gain the power to make itself acceleratingly smarter.

When it comes to what matters to us, things like freedom of humanity, what we call AI and is warned about can co-evolve to make the grip of such evolving super-organisms much tighter. It can give them more efficiency to execute their codes against the competition and help them minimize their cost-functions more aggressively to optimize their goal, money, growth, profit, order, whatever it might be.

While nature is at its own game, the bad news for us may that our current welfare and freedom can last for only a short moment in the history. That the priviledged position of the enlightened modern man may be just a temporary behavior of one of these algorithmic entities going through a phase transition.

So these fuzzy pilosophical especulations aside, I think what makes AI dangerous is something like this:

* * *

Technology has transformed us. As our individual survival depends more and more on the interaction with technology, we are gaining some freedom while losing some. Our functions are changing rapidly.

We are already not free to think with our own individual brains. Are we? The dominant codes, wide-spread systems and algorithms are dictating how we should think. What questions should be asked and what options are out there. How we should model the world, how we should think how to live. Call these forces the society, economy, media, culture; They have rules and systems and we get our thinking patterns from them. The most successful of them have evolved to copy themselves like programs in our heads and they are ruling us already.

We see now that smartphones controlled from small brain-like power hubs and control panels in the tech giants already control the masses. But they even control the CEOs of the those giants in some way. You see when these powerful individuals seem to be in full control, how suddenly desperate they become in the face of unforeseen challenges?

This is just one decade of smartphones taking over our lives. Soon enough we will even have chips in our brains and implants will replace screens and touchpads. So it would be much easier to control us, and voluntarily even.

Environmentally, almost all wild animals who did not follow the new order are gone already and only us the tamed ones are left. Some of us domesticated animals will be the the pigs locked up in the slaughter house. Some would be workers trapped somewhere else to provide electricity to those facilities. Some of us would be more free programming the machinery, some are following someone elses’ orders, who gets order from another one, who is somewhat voted by us through the propaganda that is fed to us by . No one’s really free already.

Who wrote all these code? No body as far as we know. We all together did it and it evolved with us. And it’s there now anyway. AI can only make us voluntarily head to make such a destiny much faster. Because it potentially knows us way better than we do ourselves.

We can’t even say if this scenario is good or bad. It just is. I think there’s no right or wrong at this scale.

Good or bad, I think a kidney cell can never go back to float freely in the wild precamberian oceans of the earth like its ancestors did. Not after it evolved to enjoy the economy of scale and its existence dependent to interact with the rest of the nody.

We may be heading to uncertain futures like this that find ourselves increasingly *locked up*, if not physically but algorithmically, to run functions that deals with our very survival. It sounds deterministic and sad. But we are heading that way already. I think AI could only make it faster and could come up with new creatures that would blow our current minds.

There is one thing for sure. What we are experiencing now is anything but a state of equilibrium, so we are heading to something pecular. We humans as the catalyzers of this process may try to stir it so the established future order wouldn’t be upleasant for our species. Although I doubt if we can manage.

Complex Coin!

I just thought of an algebraic suggestion to extend the domain of traditional money with the use of crypto currency.

How about we make a new currency: ComplexCoin! Its value would be like a combination of a major FIAT currency as the real value (💶) and a major crypto coin (👾) as the imaginary value. (Don’t get offended if you are a crypto enthusiast; There’s nothing more real about real numbers compared to the imaginary ones. Afterall these are concpets that mathematicians use to model and conomists can follow too.)

To use the ComplexCoin (i-Coin?) we need to make new pricing models in especial online or brick and mortar stores that sell stuff at complex prices. The pricing is stable because it shall be regulated to depend only on the complex cost of producing or acquiring the goods, and not the volatile exchange rate between the two types of currencies.

So if you have an A+Bi amount of cash in your bank account and you want to buy an item at the complex price of a+bi your account will be charged so you are left with (A-a)i+(B-b) i-Coins. As simple as that.

What matters is that the price of the goods are set by the manufacturer/distributer based only upon the complex cost of the items, all the way from mining and production to wholesale and retail.

This is meant to keep the rates more stable to help adopting cryptocurrencies in our daily lives, so it is important that at the event of purchase the exchange between the real and imaginary values shouldn’t be permitted. Of course people can in their digital bank accounts exchange between the two currencies if exchange rates are unstable.

For example, if an apple (🍎) cost a farmer 1£ and 1 Ripple they typically sell it to the wholesalers with a certain profit(say 100% would make it 2£ and 2Ripples). But even if 1 Ripple is 1£ at the time of purchase, the terminal can not charge 4£, or 4 Ripples, altough they are equal at the time of the transaction.

There can be exceptions where the terminals charges you one of the currencies when the buyer runs out of the other one, for the transaction to go through after prompting.

Also when a transaction fee is applied (purchasing abroad or cashing out at ATM), it can be charged not as a percentage of the magnitude (as it is already the case for our real-axis FIAT currencies), but instead as an angular rotation that will be profitable for the cash terminal, based on the current exchange rate between the two axes.

* * *

There may be a lot of problems and challanges for this to work obviously, but it was worth sharing. At worst, think of it as yet another coin, which creates its niche to stand out by the use of a mathematical concept instead of breeding kitties!

I just wonder if people are going to buy shares in a bank that issues this token, would that be an ICO? IPO? (i-CO or ICPO?)

My flight is taking off now and no Internet on-board this time. I shared my idea. Share your opinions here!

You matter!

This made me confess that, honestly, it’s been a while since I accepted (or forced myself to believe) that – just like you – I am being watched.

Not only by some unknown pairs of eyes sitting at NSA envying Snowden for his courage, but also by my grand children – already! – having fun in an extrapolated virtual reality of my life in data-archeological musuems of the future (if my boring practices interests any of them at all).

That’s why I find myself at ease assuming that we are at different simulations at the same time. The human park owner of the future, the alien simulator, God and the big brother are all staring at you.

This at least shows that you matter to someone.

Science and Truth

Science is not about the truth. It’s about our instrumental growth.

It’s a human specific language for the short-term dominance of this very species; a subjective and relative cultural viewpoint; a man-made phenomenon not only sensitive to geography and demography of its producers, but fundamentally relying on our specific physiological features.

Science is a random walk of accumulated literature largely indifferent to the reality; a set of self-reinforced terminologies that has hypnotised our collective mind.

Science is one in many possibilities that turned out to be the dominant widespread culture of our time due to a series of thrown dice with similar dynamics as rock pigeons colonized the urban landscape worldwide.

So if you take all of it too seriously you may as well think of a pterodactyl as the superior form of a flying object; the shape of a moldy bread as the most genuine form of the truth, or the last check-mate snapshot of a mediocre chess game as the ultimate possibility of a chess board.

Tech and Emotions

We pitched our HappIt app at Disrupt London 2014 and it didn’t take off. Our submission was immature and so was the tech savvy hackathon to understand some of its ellaborated features. It used facial expressions instead of text, had a social element to encourage emotional data logging, and used five-dimensional motion charts for visualization of historic emotions.

Two years later, same event, same city and eventually tech realizes the value of an independent platform dedicated to emotional data collection and analysis. Congratulation to Emotion Journal for wining the Disrupt London 2016 hackathon grand prize. It is a victory for promoting genuine psychometry in tech and they did it with a one-diensional donut chart!

Now the tricky discussion is always around the data collection medium. How do you fish for emotional data? How do you ask people how they feel?

This team has an implicit approach based on natural language processing. First a speech recognition module and then a sentiment analysis algorithm.

The catch is that the phonetic language did not evolve to capture or communicate human emotions at the first place. We had faces to do that. Double-articulated language evolved partly to fake those feelings even.

Right now as you read this, even if you knew me very well, you have no clue whether I write this in a state of happiness, jealousy, dissapointment, hope, anger, shame or pride and now by lining up these keywords I have made it even harder for the sentiment analysis algorithm to capture my real feelings. Technical challanges of parsing such as negation handling and so forth are not the main problems in this area.

I’d argue that facial expression is a better alternative to capture emotions, whether an implicit analysis of an actual selfie, or an explicit drawing of a simple emoticon on a smart watch in a crowded subway.

But of course a hybrid approach combining insights from all different channels (and for example taking voice intonations into account), would be ideal. Until that day, one thing I agree here the way they said it:

“If you do it once a day you can see a visual representation of your feelings and experiences over time.”

So, whichever future app you will use to log your emotions, remember to “happ” it!

Make it a happy habbit.

The futuristic people of the past

I find it worth listening to the futuristic people of the past. These are the visionary breed who see the future better than us. Now while their futuristic stories are sometimes our trivial past, it could as well be our unforeseen future!

There’s something about their way of observing the world that makes their ideas more resilient against the test of time. Those ideas die out with a different time constant than the normal so they will eventually win over the temporary opinions of the habitual daily routines, the temporary, the mortal.

Now with that in mind listen to Terence Mckenna’s interview on the power of the Internet, from 20 years ago:

At a penetration rate of perhaps less than 1% of its current rate, the rise of the Internet is referred here as an example for “the emergence of the transcendental object”.

Mckenna foresees the rise of the citizen press, new media and grassroot journalism before the creation of mainstream blogging or digital social networking services. He ellaborates so beautifully on the social aspects of the digital disruption before the rise of new business models powered by the Internet. He has great especulations on the future of augmented reality and in other sources he had predicts the rise of data science. And he spells the long-tail theory, what Chris Anderson and other visionary entrepreneurs of the Sillicon Valley started branding 10 years later (half way between this interview and us). Fun to notice that some predictions of the long-tail theory have already failed, while Mckenna’s ideas are still – mostly – valid. And last but not the least his deep insights on the “technological singularity” and the implications of extrapolating the Moore’s [and similar] laws and the take over of AI, are neater than what people like Kurzweil did, trying to coin the term to their names.

And the striking fact is that McKenna has done the same thing in several other fields, epigenetics, linguistics, anthropology and sociology. Pretty much anything that he has been queried by his audience after he was back from the woods to give talks on his new insights.

This is the power that you get when you leave the civilization and observe merely plants for a couple of decades away from an urban settings. Some turn into Charles Darwin. Some turn into Terence Mckenna. I am very excited to have found this profile. And now if you don’t find this interesting, go ahead keep reading the morning news, the scientific paper right in front of you, or the manual of your vacuum cleaner.

P.S.1. the content of your sweeper’s manual may be still valid in 20 years, so I take that one back!

P.S.2. Many futuristic attempts fail to understand the importance of that “meme time constant”. As an example, in the expensive Hollywood sci-fi projects we see that long-term trends are masked by temporary hypes. If a movie is made today to depict 2040 you see they introduce spaceships and flying cars too early, next to the to-be-extincted numerical keypads (too late). But not even a vintage radio is seen in the scenery. In a futuristic depiction I find it unrealistic not to present the past’s profound achievements in retro style. I however understand that not many others find it as silly, just yet.

Technology and the Substantiality of Experience

Melvin Sokolsky - from the bubble series
Melvin Sokolsky – from the bubble series

Technology is a great thing [for us humans], but it has a negative aspect not many talk about.

It deprives us from feeling the “real experience” in accordance to how we are biologically wired. Technology builds a protective bubble around the human body that however takes care of a lot of challenges for us, leaves us peculiarly unchallanged inside. And to elaborate a bit more on the “challange of unchallended”, it unemploys and unsues the sensorimotor circuitry in our pre-historic brains. And since we percieve happiness more directly inside our brains than on the surface of our skin or outside our bodies, this can be enough to spoil a good deal of fun for us.

In many cases technology offers the same functionality for our survival needs, but with less substance. Same outcome, less work for it. But what if “working for it” was a part of the satisfaction, that was planted in us by evolution to keep us motivated to persue tasks vital for our survival?

The main reason we have brains is sensorimotor circuitry. Some researchers claim it is the only reason. As organisms we need to act upon the world for our survival (the motor system) and in order to do that correctly we need to sense it by a sensory system. So the motor act is the primary goal and the sensory is secondary; it is needed only for the motor act to be decided correctly. Nature doesn’t care if you observe the details of the environment perfectly. Your gene code is passed on if you survive.

Now the technology sits in the way by enhancing the sensory channel and empowering the motor act. It eases the deeply emotional process of decision making, and by doing so leaves those circuitry unused and unemployed. But hasn this not made us unhappy? I used to think that technology enhances feelings and emotions since it assists and magnifies the sensory channel but at our core we are not passive sensors. We are active performers of our lives and spoiled in the comfort of our civilization we have truly lost our natural reference of comparison to our bodily similar ancestors. Lots of process that used to happen in our brains now takes place outside our bodies. Most of the signals that we used to constantly process and handle for survival does not reach the surface of our skins or don’t come even close to us. People go to the nature or gym, try extreme sports or play video games to experience those situations and trigger those condditions; It is a retro movement.

We have all heard modern-time complains about how people nowadays use digital messages instead of real ink on paper postcards, navigate the reality with GPS, and now get dates from apps without holding face-to-face conversations. The outcome is the same; conveying the message, mating or reprodution, or getting to a destination. But something is missing during the process.

Now, this familiar contemporary observations may be worrisome, but it is nothing new.

The technological dumb-down of mankind even if admitted is usually associated to the modern times. This seems to be a new trend in a couple of generations, if we take our own norms and typical lifestyles as the ultimate base for the real experience. Much of “the real experience” had already been taken away from us and before that from our ancestors for dozens of millenia:

* People express worry these days that driving skills, the real experience of navigating the roads is going to fade away with self-driving cars. But do we remember how horse riding felt before cars? Or did our horse-rider ancestors know what they were missing not to hunt an animal while running after it, barefoot?

* Spending too much time in the digital conversations and dealing with only letters and emojis makes us deaf to the intonations of the spoken language. The ability to grasp the meanings conveyed in the rise and fall of the pitch and loudness of the speech needs to be practiced. But was it not the verbal language itself that provided a parallel channel of communication and made us blind to the previous forms of communication, such as reading of emtions from facial expressions? How often do we even try to read each other’s eyes nowadays? In such intuitive social skills that were vital for tribal survival, our illiterate ancestors were more intelligent than us.

* Youth nowadays get dates for their digital profiles sometimes without composing a sentence, or having to make a face-to-face charm. An Irish man in Trondheim told me once “There was a time that people couldn’t hide behind dating profiles. You had to show up in person in real places and talk to real people and prove yourself”. As if a bar is a gladiator arena, or the spoken language itself, just like dating profiles, is not used for people to hide behind. This complain is sound but to me sounds like we would complain to our grand children: “There was a time that you couldn’t just telepathically go through a hundred thousand profiles with the chip in your brain to get a mutual date. You actually had to open an app, a real app! And had to go through profiles one by one. And you had to chat with them, for real. Like composing sentences word by word to make a connection. And then there was still a high chance that they wouldn’t match you because it was not pre-calculated!”

Much of our sensorimotor circuits are inactive since their function is outsourced to the technology. And I think that comes in an order. First the motor act, the outcome of the whole process gets outsourced and inactive, since the machinary around us does it on our behalf. Then there’s no longer need for the sensory part and so that part gets dull and dormant too.

Your worry may be right. The new generation gets spoiled by the new technology and loses the real feel of an experience. They are handed in something as functional but less sensational; less powerful, engaging, and real. Just like we were.

We know it, by comparison.
Our parents knew it, by comparison.
Their parents knew it, …

It’s been fifty thousand years folks!

The Merger

dragon

I could write this in a thousand and one narratives, but tonight is the “merger” narrative. This is because this week two telecom giants merged together. Another merger, indifferent from anybody’s struggle to stop them.

This time 85 billion dollars. Let this number sink in a bit and then try to see the pattern here. You have seen it if you follow the global business news regularly:

  • Mergers are getting more and more frequent.
  • The acquisition prices get exponentially higher.
  • The industries involved get more diverse, which means more aspects of our lives is going under monopoly.
  • The rules that used to control and stop the mergers and guarrantee a minimal competition keep getting weaker by corporate lobbyists and bribed politicians.

What do we expect from these dynamics? They will slowly kill the competition and change our norms and habits. The pace of changing our internal habbits like the external environmental changes are not fast enough to be seen by the naked eye. It’s like staring at the hour hand of the clock; A 100x time-lapse can reveal it. Actually that was a while ago. We are talking about undergoing an exponential change so a 10x time-lapse is enough to make it visible for us, what change is happening around, and inside us.

But we are extremely adaptive creatures. We collectively conform to the norms around us and if they change, we change with them. What mergers do with those norms, is that when they get enormous enough to take over a whole industry at a globel scale, they kill the competition and unify the decision making between previously copeting entities. If one of the giants starts poisoning you, the other one will make a scandal out of it. But not if both are controlled behind the same dashboard. Can we comprehend the dangers here?

Megamergers are slowly changing our lifestyles, the food we eat and what it contains, the information we get, the politicians that rule us, everything! They can already predict and influence some of the decisions we collectively make and they won’t let you notice it. They think in statistics and you are just data points in their analysis. It is not even a month passed from Monsanto/Bayer merger that broke the historic world record of acquisitions at an stonning price of $65B, that this one silently came along with $85B. Can we extrapolate such an exponential growth and see what is waiting for us? Should we be suprised in three years witnessing a half a trillion dollars merger between an already merged food/retail company and another giant social network/media multinational corporate?

Let us fast forward this, fellow frogs:

Fighting cancer gets harder when it passes a certain level. Confronting mergers is increasingly harder when they get to such an gigantic size. Still, we may have a chance to bleck them now or regulate them more by antitrust regulators, but if we keep failing and wait longer, there comes a point that we cannot change the irreversible. That day we will see more clearly what is going to happen, but we will not have the power to stop it.

If things go as they are, in the course of decades if not years, the whole civilization as we know it will be acquired by one (not two) multi trillion dollar super-company or the coalition of multinational corpotations. Then their ultimate board does whatever they want with us data points. And they will have the means to do that, because we will be totally numb by then.

Did you actually follow me this far? Most people typically fail to care to this depth since they are already numb.

But you know that I don’t believe in conspiracy theories. Right? When I say “the board” I don’t mean the mysterious bad guys who are sitting and plotting the apocalypse right now. Or whatever Illuminati. Don’t buy into those naive theories. Conspiracy theories, most of them, are for the kind hearts and simple minds.

Nature is not designed. It is organized on its own, based on simple rules. And it repeats the same patterns over and over. Nature is full of collapses and Doomdays and apocalyptic events. Big and small in all scales. These collapses are smaller babies of the big bang, only reversed:

Reversed in the sense that more and more things will happen in shorter and shorter times!

Our apocalypse will have many faces. “The merger” is one of those one thousand and one faces. The merger is a “winner take all” game. It is a race and we are all in it, but we don’t know who will win, however, there will be a winner. And many many losers. No one can predict who eats whom at the end of the game, but that will eventually turn out. And everyone will be surprised.

Even the people who may think they are conspirist themselves. Even those who think they are the bad guys.

There is a power above us all; It’s cancer. It’s nature. It’s evolution.

I haven’t spoiled the movie for you yet, and I guarrantee it will be full of surprises that none of us can foresee.

Good night. Till another night of the 1001 night.