Bitcoin: A buyer's and seller's guide
Why invest real money in digital coin? Because the payoff a decade from now could be enormous.
Bill Barhydt is founder and CEO of Abra, a global crypto-wallet and exchange network. Abra’s breakthrough is its synthetic currency technology based on crypto smart contracts.
Bill’s passion is information technology and how it can be used to improve lives. He is an advisor and investor in many companies in the payments, telecom and consumer Internet sectors and in 2011 gave the first-ever TED talk on Bitcoin. He has also consulted to federal and international regulators on the impact of digital currencies and decentralized transaction systems.
For the past 15 years, Bill has worked as an executive and investor in the mobile industry including industry changing banking, gaming and IoT investments across the telecom and IT sectors.
Bill was an early employee of Netscape, where he worked on the first design and deployments for SSL and the X.509 digital certificate standard as well as designing early .com era services. He worked for Goldman Sachs designing trading systems and was a researcher for NASA and the CIA. In 2000, Barhydt received the Technology Pioneer Award from the World Economic Forum for his work in online collaboration and Internet Technologies.
Bill is an avid mountain trail runner and crossfit games competitor who has completed several tough mudder races.
Bill Barhydt: I think there’s a few things that need to happen for cryptocurrencies to become kind of a global replacement for either reserve currencies, global money transfer vis-à-vis like swift wires via your bank.
First of all the system needs to be massively liquid. If you think about dollar as a reserve currency, there’s trillions of dollars in circulation. It’s globally liquid across tens of thousands of banks, across 185 countries, etcetera, etcetera. That’s not totally true of cryptocurrencies yet.
If you take Bitcoin, which is the most successful cryptocurrency, its market cap is around $200 billion as of today. It’s tradable in 100 plus countries, but the liquidity of bitcoin versus even the U.S. dollar is relatively low, which means it needs to be worth a lot more if it would become let’s say a “digital gold”.
Gold is worth trillions of dollars in the aggregate. Bitcoin is not yet worth that much. And that’s important because if it’s not worth trillions of dollars and billions of people want to use it there’s not enough to go around. So you need to be able to break it up into tiny pieces so everyone can use it, just like gold.
And that’s not true until it’s worth a lot more money than it is today. But it becomes a circular discussion because the usage will also drive the price higher, just like speculation sometimes can drive the price higher.
So over time it should get there by its ability to be fungible with fiat via these exchanges as kind of an onramp into digital currency, but also it should meet the liquidity requirements that we need, meaning the price should be high enough, the ability to get in and out via traditional money should be reasonable globally over the next few years, and then I believe you can really have a viable discussion about using a cryptocurrency like bitcoin as a viable reserve currency.
So cryptocurrencies eventually will look like traditional commodities in my opinion, whether it’s gold or platinum or other metals is probably the best. But it could look like oil and gas and things like that.
And so they are starting to trade in a fashion that’s more and more similar to traditional commodities. But the difference right now is they’re not as liquid yet. So that means that the price is very inefficient, or the markets for cryptocurrencies are very inefficient.
So most people who are holding cryptocurrencies are long term holders, they’re not selling. So that actually means that the price of Bitcoin and Ether, for example, is largely driven by the volume of buyers.
So if there’s large volumes of buyers coming into the market it drives the price higher, because there’s not a lot of sellers. But if the buyers dry up then the price goes down regardless, because there’s still not a lot of sellers.
So that will change over time because if the price skyrockets – so, for example, if institutional money starts to come into the cryptocurrency market in large numbers—which I think it will—that will force the price higher because there’s not enough cryptocurrency to go around. And that will also cause some of the holders to loosen up their purse strings because they’re going to want to reap the profits that they’ve been waiting for for 10-15 years by the time that happens.
And that will also create more liquidity in the system which will create a really positive feedback loop which should drive the price even higher.
The other thing that I think is very relevant is you’re starting to see more traditional types of financial products being applied to cryptocurrencies – derivatives, options, nondeliverable forward contracts, things like that that actually will help make the cryptocurrency market more efficient over time, close a lot of what we call arbitrage loopholes which is kind of like free money in the system for traders. And as those loopholes get closed the market becomes more efficient, more liquid, and it becomes better for everyone.
This, I think, is a common misunderstanding with how bitcoin works: Bitcoin itself is what we call deflationary, which means that over time the amount of Bitcoin in circulation if you look at a chart would actually approach a fixed value of 21 million – never quite approach it but it will asymptotically in math terms approach that line of 21 million over time. And it does that by the amount of Bitcoin being mined or created being cut in half every so often.
Right now it’s every few years and then it’ll be every few months and then et cetera, et cetera. And so that these happenings actually create a predictable rate at which Bitcoin is created. That rate like I said will asymptotically approach 21 million over several years, and at that point though if Bitcoin is being used for money transfer applications, there’s institutional investors buying it like digital gold that will drive the price higher, but if the price shoots up to let’s say a trillion dollars and there’s only 21 million, it’s still not a problem because you can subdivide Bitcoin down to eight decimal places.
So you can get to the point where one Satoshi, which is .00000001 Bitcoin, could be worth $1,000 as opposed to today one Bitcoin is worth $5,000 or $8,000, whatever it is at today’s price.
So the ability to subdivide Bitcoin into tiny amounts called Satoshis (which are in today’s value fractions of a penny) could eventually be worth thousands of dollars in their own right. So that gives the utility of Bitcoin a lot of legroom for the long term, because even if the value goes up to trillions you’ll be able to subdivide it into small amounts to make it useful for small payments.
When it comes to Bitcoin it's all about the long game, says Abra founder and CEO Bill Barhydt. Bitcoin is flexible because you can break it up into smaller divisions, called Satoshis. In 10 to 15 years, those Satoshis alone could be $1000 a piece. It might take a while for Bitcoin to really start trading at the level of gold and silver, says Bill. Interestingly enough, says Bill, by and large, people who have Bitcoin are holding on to it, just like those precious metals. Once more of it is mined, we'll start to see the market become less volatile.
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Northwell Health is using insights from website traffic to forecast COVID-19 hospitalizations two weeks in the future.
- The machine-learning algorithm works by analyzing the online behavior of visitors to the Northwell Health website and comparing that data to future COVID-19 hospitalizations.
- The tool, which uses anonymized data, has so far predicted hospitalizations with an accuracy rate of 80 percent.
- Machine-learning tools are helping health-care professionals worldwide better constrain and treat COVID-19.
The value of forecasting<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yNTA0Njk2OC9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYyMzM2NDQzOH0.rid9regiDaKczCCKBsu7wrHkNQ64Vz_XcOEZIzAhzgM/img.jpg?width=980" id="2bb93" class="rm-shortcode" data-rm-shortcode-id="31345afbdf2bd408fd3e9f31520c445a" data-rm-shortcode-name="rebelmouse-image" data-width="1546" data-height="1056" />
Northwell emergency departments use the dashboard to monitor in real time.
Credit: Northwell Health<p>One unique benefit of forecasting COVID-19 hospitalizations is that it allows health systems to better prepare, manage and allocate resources. For example, if the tool forecasted a surge in COVID-19 hospitalizations in two weeks, Northwell Health could begin:</p><ul><li>Making space for an influx of patients</li><li>Moving personal protective equipment to where it's most needed</li><li>Strategically allocating staff during the predicted surge</li><li>Increasing the number of tests offered to asymptomatic patients</li></ul><p>The health-care field is increasingly using machine learning. It's already helping doctors develop <a href="https://care.diabetesjournals.org/content/early/2020/06/09/dc19-1870" target="_blank">personalized care plans for diabetes patients</a>, improving cancer screening techniques, and enabling mental health professionals to better predict which patients are at <a href="https://healthitanalytics.com/news/ehr-data-fuels-accurate-predictive-analytics-for-suicide-risk" target="_blank" rel="noopener noreferrer">elevated risk of suicide</a>, to name a few applications.</p><p>Health systems around the world have already begun exploring how <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7315944/" target="_blank" rel="noopener noreferrer">machine learning can help battle the pandemic</a>, including better COVID-19 screening, diagnosis, contact tracing, and drug and vaccine development.</p><p>Cruzen said these kinds of tools represent a shift in how health systems can tackle a wide variety of problems.</p><p>"Health care has always used the past to predict the future, but not in this mathematical way," Cruzen said. "I think [Northwell Health's new predictive tool] really is a great first example of how we should be attacking a lot of things as we go forward."</p>
Making machine-learning tools openly accessible<p>Northwell Health has made its predictive tool <a href="https://github.com/northwell-health/covid-web-data-predictor" target="_blank">available for free</a> to any health system that wishes to utilize it.</p><p>"COVID is everybody's problem, and I think developing tools that can be used to help others is sort of why people go into health care," Dr. Cruzen said. "It was really consistent with our mission."</p><p>Open collaboration is something the world's governments and health systems should be striving for during the pandemic, said Michael Dowling, Northwell Health's president and CEO.</p><p>"Whenever you develop anything and somebody else gets it, they improve it and they continue to make it better," Dowling said. "As a country, we lack data. I believe very, very strongly that we should have been and should be now working with other countries, including China, including the European Union, including England and others to figure out how to develop a health surveillance system so you can anticipate way in advance when these things are going to occur."</p><p>In all, Northwell Health has treated more than 112,000 COVID patients. During the pandemic, Dowling said he's seen an outpouring of goodwill, collaboration, and sacrifice from the community and the tens of thousands of staff who work across Northwell.</p><p>"COVID has changed our perspective on everything—and not just those of us in health care, because it has disrupted everybody's life," Dowling said. "It has demonstrated the value of community, how we help one another."</p>
Archaeologists discover a cave painting of a wild pig that is now the world's oldest dated work of representational art.
- Archaeologists find a cave painting of a wild pig that is at least 45,500 years old.
- The painting is the earliest known work of representational art.
- The discovery was made in a remote valley on the Indonesian island of Sulawesi.
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The Persian polymath and philosopher of the Islamic Golden Age teaches us about self-awareness.
A leading British space scientist thinks there is life under the ice sheets of Europa.
- A British scientist named Professor Monica Grady recently came out in support of extraterrestrial life on Europa.
- Europa, the sixth largest moon in the solar system, may have favorable conditions for life under its miles of ice.
- The moon is one of Jupiter's 79.
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Water Vapor Above Europa’s Surface Deteced for First Time<span style="display:block;position:relative;padding-top:56.25%;" class="rm-shortcode" data-rm-shortcode-id="9c4abc8473e1b89170cc8941beeb1f2d"><iframe type="lazy-iframe" data-runner-src="https://www.youtube.com/embed/WQ-E1lnSOzc?rel=0" width="100%" height="auto" frameborder="0" scrolling="no" style="position:absolute;top:0;left:0;width:100%;height:100%;"></iframe></span>
Can computers do calculations in multiple universes? Scientists are working on it. Step into the world of quantum computing.
- While today's computers—referred to as classical computers—continue to become more and more powerful, there is a ceiling to their advancement due to the physical limits of the materials used to make them. Quantum computing allows physicists and researchers to exponentially increase computation power, harnessing potential parallel realities to do so.
- Quantum computer chips are astoundingly small, about the size of a fingernail. Scientists have to not only build the computer itself but also the ultra-protected environment in which they operate. Total isolation is required to eliminate vibrations and other external influences on synchronized atoms; if the atoms become 'decoherent' the quantum computer cannot function.
- "You need to create a very quiet, clean, cold environment for these chips to work in," says quantum computing expert Vern Brownell. The coldest temperature possible in physics is -273.15 degrees C. The rooms required for quantum computing are -273.14 degrees C, which is 150 times colder than outer space. It is complex and mind-boggling work, but the potential for computation that harnesses the power of parallel universes is worth the chase.