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The open letter warns about artificial intelligence and should also apply to cryptocurrencies

Published

8 months ago

7 June, 2024

Open letter warns about AI — and it should apply to crypto too

Both AI and cryptocurrencies move at breakneck speed and are deeply technical, making them difficult to regulate, but whistleblowers are silenced.

Another week and another warning about AI.

But this open letter – express fears that it could exacerbate inequalities, fuel misinformation and lead to uncontrollable situations TO THE systems that “potentially cause human extinction” strike differently.

Why? Because four of the anonymous signatories are current employees of OpenAIthe creator of the very popular ChatGPT. Six others worked there.

The fact that so many people involved in bringing AI to the masses fear for the future is significant. While they believe this still-nascent technology could offer “unprecedented benefits” to humanity, they fear the public – and regulators – don’t have the full picture.

“AI companies possess substantial non-public information about the capabilities and limitations of their systems, the adequacy of their protection measures, and the risk levels of different types of harm. However, they currently have only limited obligations to share some of this information with governments and none with civil society. We don’t think you can rely on everyone sharing it voluntarily.”

Right to Notify

The parallels between artificial intelligence and cryptocurrency the space is quite bare. Both industries move at breakneck speed and are deeply technical. This creates huge obstacles for both governments and regulators. For one thing, some politicians may find it difficult to understand the issue itself. Just ask U.S. Representative Brad Sherman, who infamously referred to Bitcoin’s creator as “Saratoshi Nagamoto.”

“I don’t believe Saratoshi Nagamoto was innovative.”#Bitcoin could care less. pic.twitter.com/y3zNB46i49

— Guti ₿ 🇺🇸 🇵🇪 (@guti_uno) July 27, 2023

From here, it becomes difficult to prepare literate laws that encourage innovation among the good actors and at the same time discourage crime among the bad ones. And when authorities do catch up, such industries are often so unrecognizable that the legislation on the table fails to reflect the reality of how the technology is used… and where the greatest risks lie. Significantly, there is still significant regulatory paralysis around cryptocurrencies in the United States, more than 15 years later Bitcoin launched for the first time.

As the AI-focused open letter points out, the lack of effective government oversight means there is a huge reliance on whistleblowers within companies to hold them accountable. One of the authors’ biggest concerns is how confidentiality agreements prevent them from speaking openly.

“Ordinary whistleblower protections are insufficient because they focus on illegal activity, while many of the risks we are concerned about are still unregulated. Some of us reasonably fear various forms of retaliation.“

Right to Notify

Here too, there is a symmetry between artificial intelligence and cryptocurrencies, as highlighted by a recent, in-depth and damning report published by an independent examiner appointed to investigate those of FTX implosion in 2022. In that case, it was discovered that six anonymous whistleblowers with legitimate concerns were paid to the tune of $25 million. One was told to apologize now in prison CEO Sam Bankman Friedand ultimately reached a settlement for $16 million after stepping down from their roles.

While the cryptocurrency industry has made great strides in correcting past mistakes following a series of failures in recent years – BlockFi, Traveler AND Centigrade among these, it could be argued that there is still much work to be done. And that makes the four commitments requested of AI companies in this open letter particularly applicable to the digital assets sector.

There is a call for major AI companies to refrain from enforcing clauses that ban critics from serving employees concerned about emerging risks – and to introduce anonymous procedures so concerns can be raised to boards, regulators and experts. Some of the biggest cryptocurrency controversies could have been avoided if similar safeguards had been in place.

And beyond embracing a culture of open criticism, there is a call for AI industry leaders to promise that they will not retaliate against workers who release classified information after exhausting all other avenues to exacerbate a problem.

It’s unclear how much this open letter will shift the needle in efforts to regulate AI. And there is something to be said for the inherent transparency of blockchain technology, where the flow of funds – and transaction records – can be monitored in real time. Large language models, typically built behind closed doors, are much more opaque by comparison.

But the consequences of failure to act and the potential harms that everyday consumers face are equally dire in both sectors. Too many cryptocurrency investors have lost their life savings because they were not adequately informed of the risks, with a lack of coordination among international regulators to prevent offshore bad actors from going unchecked. And as AI becomes smarter and more user-friendly every day, the livelihoods of millions of hard-working people could now also be put in jeopardy.

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How Ether Spot ETF Approval Could Impact Crypto Prices: CNBC Crypto World

Published

7 months ago

3 July, 2024

AltcoinUpdates Staff

How Ether Spot ETF Approval Could Impact Crypto Prices: CNBC Crypto World

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CNBC Crypto World features the latest news and daily trading updates from the digital currency markets and gives viewers a glimpse of what’s to come with high-profile interviews, explainers and unique stories from the ever-changing cryptocurrency industry. On today’s show, Ledn Chief Investment Officer John Glover weighs in on what’s driving cryptocurrency prices right now and how the potential approval of spot ether ETFs could impact markets.

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Miners’ ‘Capitulation’ Signals Bitcoin Price May Have Bottomed Out: CryptoQuant

Published

7 months ago

3 July, 2024

AltcoinUpdates Staff

Miners' 'Capitulation' Signals Bitcoin Price May Have Bottomed Out: CryptoQuant

According to CryptoQuant, blockchain data shows signs that the Bitcoin mining industry is “capitulating,” a likely precursor to Bitcoin hitting a local price bottom before reaching new highs.

CryptoQuant analyzed metrics for miners, who are responsible for securing the Bitcoin network in exchange for newly minted BTC. As outlined in the market intelligence platform’s Wednesday report, multiple signs of capitulation have emerged over the past month, during which Bitcoin’s price has fallen 13% from $68,791 to $59,603.

One such sign includes a significant drop in Bitcoin’s hash rate, the total computing power that backs Bitcoin. After hitting a record high of 623 exashashes per second (EH/s) on April 27, the hash rate has fallen 7.7% to 576 EH/s, its lowest level in four months.

“Historically, extreme hash rate drawdowns have been associated with price bottoms,” CryptoQuant wrote. In particular, the 7.7% drawdown is reminiscent of an equivalent hash rate drawdown in December 2022, when Bitcoin’s price bottomed at $16,000 before rallying over 300% over the next 15 months.

This latest hash rate drop follows Bitcoin’s fourth cyclical “halving” event in April, which cut the number of coins paid out to miners in half. According to CryptoQuant’s Miner Profit/Loss Sustainability Indicator, this has left miners “mostly extremely underpaid” since April 20, forcing many to shut down mining machines that have now become unprofitable.

CrypotoQuant said that miners faced a 63% drop in daily revenue after the halving, when both Bitcoin block rewards and transaction fee revenues were much higher.

During this time, Bitcoin miners were seen moving coins from their on-chain wallets at a faster rate than usual, indicating that they may be selling their BTC reserves“Daily miner outflows reached their highest volume since May 21,” the company wrote.

Among the sales of Bitcoin miners, whales and national governmentsBitcoin’s price drop in June also hurt Bitcoin’s “hash price,” a metric of Bitcoin Miner Profitability per unit of computing power.

“Average mining revenue per hash (hash price) continues to hover near all-time lows,” CryptoQuant wrote. “Hashprice stands at $0.049 per EH/s, just above the all-time low hashprice of $0.045 reached on May 1st.”

By Ryan-Ozawa.

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US Congressman French Hill Doubles Down on Trump’s Pro-Crypto Stance

Published

7 months ago

3 July, 2024

AltcoinUpdates Staff

US Congressman French Hill Doubles Down on Trump's Pro-Crypto Stance

US lawmaker French Hill has noted that Donald Trump will take a more pro-crypto approach than the current administration. The run-up to the presidential election has seen cryptocurrencies become an issue with lawmakers making huge statements ahead of the polls. Donald Trump has also been reaching out to the industry, making a pro-crypto case.

French Hill Backs Trump’s Pro-Crypto Stance

Republican Congressman French Hill has explained the type of cryptocurrency regulatory framework he believes Donald Trump could adopt in the country. In a recent interview with CNBC, French Hill said that the recently passed FIT21 bill is the type of regulatory framework the Trump administration will adopt in the sector.

#FIT21 passed the House with 71 Democratic votes, it’s exactly the kind of digital asset regulatory framework former President Trump would support if re-elected.

See more on @SquawkCNBC🔽 photo.twitter.com/ceTmU4LApU

— French Hill (@RepFrenchHill) July 3, 2024

THE FIT21 Bill It is intended to protect investors and consumers in the market by establishing clear rules and powers for the various regulators in the sector. According to Hill, Trump will adopt it because it directs the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) on the specific regulatory framework needed in the market.

“… for people who are innovating and starting a crypto token, a related business, custody of those assets, how to ensure consumer protection, so I think that framework is the right approach and that’s what I’m going to recommend to the President to pass, which is that we have not passed it between now and the end of this Congress.”

He also called Trump an innovative and pro-growth president in financial matters.

Cryptocurrency is going mainstream

This election cycle saw the cryptocurrency industry taking a place in mainstream issues following broader adoption across demographics. From candidates moving toward enthusiasts to recent pro-Congress legislation, cryptocurrencies have become a rallying point for officials. The U.S. regulatory landscape has been criticized for stifling growth due to frequent SEC LawsuitsThis has led executives to push for pro-cryptocurrency laws and raise money for pro-industry candidates.

David Pokima

David is a financial news contributor with 4 years of experience in Blockchain and cryptocurrency. He is interested in learning about emerging technologies and has an eye for breaking news. Keeping up to date with trends, David has written in several niches including regulation, partnerships, cryptocurrency, stocks, NFTs, etc. Away from the financial markets, David enjoys cycling and horseback riding.

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US Court Orders Sam Ikkurty to Pay $84 Million for Cryptocurrency Ponzi Scheme

Published

7 months ago

3 July, 2024

AltcoinUpdates Staff

U.S. Court orders Sam Ikkurty to pay $84M for crypto Ponzi scheme

A federal court has ordered Jafia LLC and its owner, Sam Ikkurty, to pay nearly $84 million to cryptocurrency investors after ruling that the company was operating a Ponzi scheme.

The ruling, issued by Judge Mary Rowland in the U.S. District Court for the Northern District of Illinois, follows a lawsuit filed by the Commodity Futures Trading Commission (CFTC) in 2022 after the fund collapsed.

Judge Rowland found that Ikkurty, based in Portland, Oregon, did numerous false claims on his company’s hedge funds.

These included misleading statements about his trading experience and the promise of high and stable profits. Instead, Ikkurty used funds from new investors to pay off previous investors, a hallmark of a Ponzi scheme.

The Ponzi Scheme

The court found that Ikkurty misappropriated investment funds for personal use without the knowledge of the investors. These funds were used for personal use and were reported as Fraudulent Investmentscausing significant financial losses to customers.

This non-transparent operation violated Transparency Commission regulations, which led to the imposition of a hefty fine to compensate defrauded investors and restore some public confidence in the financial system.

Judge Rowland emphasized that fraudulent activity such as this violates the law and undermines the integrity of modern financial markets. The $84 million award seeks to address the financial harm inflicted on investors and reinforce the importance of legal compliance in cryptocurrency trading.

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