This Tory Gang Is A Repressive Regime, Exploiting Britain For Its Own Gain

The British government's recent attacks on public sector workers' pleas for fair pay and the right to strike have shocked only those who have not followed the plans of Boris Johnson and a cabal of Conservative Party members, donors and cronies...

Since early 2016, when Johnson and Gove hatched their Brexit plans at a dinner with the wealthy son of a Russian KGB officer, Britain's Conservative Party has been transformed into a vehicle for bending Britain to the will and benefit of a far right cabal under a false banner of 'liberty' and other lies. At stake is power and the ability to allocate vast amounts of public money to their plans, starving everyone else of wealth and power in the process. This is the very opposite of 'liberty' and 'democracy' and has most in common with Orban's regime in Hungary and Putin's regime in Russia. There is hope for ordinary Britons, just as far right experiments have been defeated for now in the US, Australia and Brazil. Yet ultra conservative forces continue to lurk even in those countries. 

The first step was to persuade the masses to decouple Britain from the world's largest trade bloc, not only the UK's biggest external market for goods, services, labour and capital, but also a source of trade rules and standards - many designed by Britain itself - to protect consumers and workers and ensure a level playing field among members of the bloc: all standing in the way of this Tory cabal and their plans. The inevitable blow to Britain's economy (while their hedge fund donors made billions) was key to weakening potential sources of resistance to their plans.

As soon as this gang had a public mandate for destruction, they were able to root out from their ranks anyone who stood in their way. The 2019 election saw the removal of all centrist Tory Members of Parliament who were not prepared to kow-tow to the Enterprise Research Group and a web of conservative 'stink' tanks. 

Once country and party were fully in their hands, Johnson and his gang were free to unlawfully award vast fortunes in contracts to cronies, break international asylum and trade laws, behave as they wished even in the grip of a pandemic while requiring others to follow their rules, threaten any source of resistance in the media; and begin their assault on workers rights (proposing laws only seen in Russia and Hungary), food and other product standards, financial constraints and other checks on greed and corruption, recklessly introducing legislation to rip-out any laws adopted from the EU by the end of 2023 without adequate assessment of the impact. 

That process is still playing out before our very eyes under the false flag of 'liberty' and libertarian ideals that are actually authoritarian in nature and designed to bend Britain's economy and people to the Tories' self-serving whims.

Make no mistake. Sunak and his crew are of the same stamp as Johnson and Gove (mostly the same people). And as Sunak's failure to rein in Johnson's own lucrative speaking tour while still an MP has perfectly demonstrated, they are all in government purely and simply for themselves.

Yet none of the alleged benefits of leaving the EU has ever surfaced. Only the downsides for everyone but the Tories and their donors and cronies. 

It's the biggest electoral fraud in Britain's history, and the most repressive regime this country has seen in modern times.

Why Is Fishy Rishi Flogging The Crypto Dream?

"We're looking at politician who has a lot more direct exposure to the Crypto industry than most world leaders".  Yahoo! finance

While he was Chancellor, Rishi Sunak - the wealthy hedge-fund guy who sold us Boris Johnson - met crypto-asset manager Bitwise and Solana Labs, and leading tech/crypto venture firms Sequoia and Andreessen Horowitz, among others. Then he committed the UK to be a "global hub for cryptoasset technology" and commissioned the Royal Mint to "issue a non-fungible token (NFT) by the end of the year “as an emblem of the forward-looking approach the UK is determined to take.” [my emphasis on the weasel words]." Of course, that NFT thing never happened. But Sunak did drive plans to regulate 'stablecoins' as a means of payment - in a way that gave him (as Chancellor) the ability to change the qualifying definition. 

To give you some insight into Sunak's Crypto meetings: before the collapse of his FTX house of cards, Sam Bankman-Fried was a "big supporter of Solana" which is itself no stranger to controversy; Sequoia was the leading venture firm backing FTX, with $150m, while Sequoia's own investment funds received $200m via FTX's trading arm, Alameda Research; and Andreessen Horowitz led a $314m 'private token sale' by Solana. Meanwhile, Bitwise also has a stake in Solana and, among many boosterish claims, Bitwise CIO says the reason why the price of Ether is drifting sideways is that it's being suppressed by general Crypto industry bad news rather than, say, the fact that Ethereum mining is no longer profitable.

Like the Tory Party (and Sunak's government), the Crypto currency world (as opposed to many plausible but mundane scenarios for deploying distributed ledger tech generally) lacks substance and is rancid with infuriating boosterism. So it may simply be that Rishi feels at home in both camps. 

But based on his career progression and political record, my sense is that whatever Rishi's selling you'd be a damn fool to buy... 

Is The Production Cost Floor Another Flaw In Cryptocurrencies?

The fact that one of the largest bitcoin miners has just filed for bankruptcy underscores the significance of the fact that the BTC price has hovered around the average mining cost of approximately $17,000 since November 9. When added to the fact that both the trade volumes and the price of the supposedly 'trustless' cryptocurrency have been flattened by the implosion of numerous cryptoverse intermediaries in the past few months, it seems there are a number of very important 'externalities' that the bitcoin protocol and blockchain are unable to address and the market has failed to appreciate.

Of course, Core Scientific's filing follows several warnings, and the bankruptcy of another miner in September, as explained by Coindesk in the latest coverage. But the fact that this filing comes amidst the market doldrums related to the FTX collapse and speculation on Binance makes it particularly significant.

How do you calculate the cost of mining a bitcoin?

One industry 'Bitcoin Mining Profitability Calculator' assumes the following (presumably not necessarily for the major miners):

Mining metrics are calculated based on a network hash rate of 6,363,326,225 GH/s and using a BTC - USD exchange rate of 1 BTC = $ 16,810.56. These figures vary based on the total network hash rate and on the BTC to USD conversion rate. Block reward is fixed at 6.25 BTC. Future block reward and hash rate changes are not taken into account. The average block time used in the calculation is 617 seconds. The electricity price used in generating these metrics is $ 0.12 per kWh. Network hash rate varies over time, this is just an estimation based on current values.

Of course, the mere quantity of energy consumed in mining bitcoin is itself a significant problem to be solved.

When considering the drivers of the base mining cost (or the Production Cost Floor or Bitcoin Electrical Cost, as calculated by the analyst Charles Edwards), it's worth noting that the bankruptcy filings for NASDAQ listed Core Scientific (CORZ) explain that 45% of a proposed $72m rescue package hangs on a #BTC price of $18,500. This suggests that Core's actual mining cost per bitcoin is higher, presumably because of higher energy costs relative to other miners, but also the cost of its financing arrangements.

Core Scientific seems to have effectively borrowed over $600m in convertible notes, bank facilities and DeFi loans, and in the context of a bankruptcy this must affect Core's own base mining cost. But this should extend to other miners, given the Core's 10% market share; the fact that another miner, Compute North, filed for bankruptcy in September owing about $500m; and the sector as a whole has $2.5bn in fiat currency borrowings. Borrowing must also be directly related to the miner's own view on how much it needs to weather market troughs and possibly to protect a desired base price (not to mention that fact that the Bitcoin protocol halves mining rewards periodically with the next halving due in 2024, on current forecasts).  

What's harder to factor in is the wider risk of contagion due to lenders' overall credit risk exposure and potentially increasing finance costs or even withdrawal from the sector in certain circumstances...

In other words, a more sophisticated base mining cost calculation is fraught with uncertainty. 

At best, therefore, the base mining cost is merely one factor to consider as a guide to the future of miners and bitcoin.

Can the mining sector (and bitcoin) recover?

Core Scientific says it hopes to win the support of key creditors and continue mining.

Continuing market hype also suggests that Bitcoiners are still ploughing in time and advertising spend to stoke demand, which may increase trading volumes and prices. 

Energy/electricity costs should fall, if and when Putin finally accepts defeat in Ukraine... but when will that be? 

Will lender appetite persist amid the ongoing contagion from the FTX (and Binance?) fallout?

Time is indeed money when it comes to the $2.5bn in real world commercial debt outstanding among miners. 

Stick all that in your protocol!

When all is said and done, it seems to me that the claimed ideological 'purity' of bitcoin as a 'permissionless', 'trustless', 'fully decentralised' 'currency' is actually vulnerable to the following 'externalities' (either in the sense of affecting outsiders but not being reflected in the market price and/or being apparently outside the perception of bitcoin proponents/fans): 

• the centralising effect of intermediaries, such as crypto exchanges, custodians and decentralised finance (DeFi) providers;

• wilful misconduct by intermediaries (resulting potentially in active distrust of bitcoin itself); 

• the sheer scale and quantity of energy required to mine each bitcoin;

• rising energy costs;

• limits on computing efficiency; 

• existing and proposed regulation; 

• competition from other cryptocurrencies or types of token (e.g. stablecoins);

• (over) borrowing/investment by miners; and

• 'news' or commentary concerning each of the other externalities listed above. 

That's not to say bitcoin is necessarily 'worthless', but it is not the idyllic ecosystem that fans claim it to be; and can't really be dubbed 'successful' until it's value is not subject to the wild swings we've seen to date nor at risk of being significantly undermined by any of the above externalities.

Before You Invest, Please Realise That 'Web 3' Is Not The Same As 'Web 3.0'

Tech hypsters are colliding in cyperspace over rival claims to being the latest version of 'the Internet'. And the media aren't helping by failing to spot critical distinctions, as in CNN's recent mistake in interviewing a Web 3/'blockchain expert' about the Web 3.0 data privacy business started by Tim Berners-Lee (who has already warned us to ignore Web 3).

Perhaps the confusion stems from that fact that 'decentralisation' is a common theme for both: 

• the "Web 3" world of distributed ledger technology, blockchains, crypto-tokens, cryptocurrencies, cryptoassets and non-fungible tokens (NFTs), in which the community of more zealous participants are referred to as "Crypto"; and

• the evolution of the World Wide Web from Web 1.0 to Web 2.0 to "Web 3.0" under the W3C banner - the space on the Internet (a network of networks, defined by the TPC/IP standards) in which the items of interest ("resources"), are identified by global Uniform Resource Identifiers (URI), the first three specifications of which were URLs, HTTP, and HTML.

While the Ethereum blockchain co-founder Gavin Wood suggests he "coined" the term Web 3.0 in 2014, it was certainly in use before then, as even my own post from January 2013 demonstrates - and I definitely didn't coin it. In fact, the Wikipedia entry for 'semantic web' cites a New York Times quote from 2006 that suggests 'Web 3.0' began being used in connection with linking data resources somewhat earlier than that:

People keep asking what Web 3.0 is. I think maybe when you've got an overlay of scalable vector graphics – everything rippling and folding and looking misty – on Web 2.0 and access to a semantic Web integrated across a huge space of data, you'll have access to an unbelievable data resource … 

— Tim Berners-Lee, 2006

The goal of the Web 3.0 community is to enable you to take control over 'your own data' (all data generated by your activity, not just personal data), enabling you to permit who can access and use it from wherever it is stored, by means of 'application programming interfaces' (APIs). This is encompassed in the concept of "linked data" and "linked datasets", often also referred to as "the semantic web". Midata is a related regulatory trend toward enabling consumers to control their own data, of which Open Banking and Open Finance generally are examples.

On the other hand, the goal of the Web 3/Crypto community is a broader, libertarian utopia that (according to Ethereum) guarantees 'personal sovereignty' in a 'permissionless', 'trustless' cryptographic environment with its own 'native' means of peer-to-peer payment. 

Unfortunately, in my view, the absence of trust in this would-be Crypto idyll is merely an externality that others are yet to satisfactorily address, as demonstrated by the collapse of many crypto exchanges and other 'decentralised finance' (DeFi) participants, the most recent being FTX group... 

All the more reason not to confuse 'crypto' Web 3 with 'semantic' Web 3.0!

Britain Needs An Independent Commission Against Corruption

The Baroness Mone saga is proving, yet again, that the British state is very poorly protected against those who (allegedly) require Ministers and/or officials to act unlawfully and/or in breach of their codes of conduct.

Unlike many other jurisdictions, Britain has no organised 'anti-corruption' programme, but only individual agencies that may focus partly on the public sector as part of their remit to address fraud and so on. The highest claim to an anti-corruption focus is a "collection" of "documents related to the government's work to combat domestic and international corruption"  and an "Anti-corruption Plan" from 2014, signed by none other than... [drum roll] Matt Hancock, whose subsequent activities are alleged to lie at the heart of a vast misallocation of public resources, not to mention the discharge of Covid patients into poorly equipped social care settings...

Prime Minister Boris Johnson's own 'anti-corruption champion' managed to remain in post throughout numerous 'scandals' from 2017 until his abrupt resignation in June 2022, including that of the unlawful appointment of his own wife to public office by... Matt Hancock. What sparked this 'champion's' resignation was the fact that "Johnson’s independent adviser on ministerial interests, Lord Geidt, had said he felt unable to offer his opinion on whether Johnson had broken the [Ministerial] Code, because he might have felt compelled to resign if his advice were not followed." 

There's an offence of Misconduct in Public Office, but that seems so hedged around with discretion as to be deliberately subvertible.

Most significant unlawful government activity seems to be revealed through private lawsuits. And a skim through the many private actions initiated by the Good Law Project, for example, illustrates that HMS Britannia has a very leaky hull indeed. 

But that's the tip of the iceberg when you consider strong patterns of successful challenges to government decisions relating to the withdrawal of personal independence benefits, for example, and refusal of asylum applications. 

The UK even has a mechanism for civil servants to be absolved from legal responsibility so long as they receive a 'ministerial direction' to proceed - many of which have been issued in the May/Johnson era:

They have a duty to seek a ministerial direction if they think a spending proposal breaches any of the following criteria: 

• Regularity – if the proposal is beyond the department’s legal powers, or agreed spending budgets 
• Propriety – if it doesn’t meet ‘high standards of public conduct’, such as appropriate governance or parliamentary expectations 
• Value for money – if something else, or doing nothing, would be cheaper and better 
• Feasibility – if there is doubt about the proposal being ‘implemented accurately, sustainably or to the intended timetable’

While this results in the minister being responsible, there is little sign of actual ministerial accountability, especially where the government of the day holds a sizeable majority in Parliament and/or has significant links or sway with the media.

This lack of oversight and consequences for unlawful ministerial activity has meant that populist party policies and cronyism have overtaken the Rule of Law as the guiding principles for the British state. 

It's therefore time that Britain had its own 'Independent Commission Against Corruption', as was introduced in the state of New South Wales. It's no panacea, obviously, but it would more effective than anything the UK has now.