"Dubbed TotalRecall—yes, after the 1990 sci-fi film—the tool can pull all the information that Recall saves into its main database on a Windows laptop. “The database is unencrypted. It’s all plain text,” Hagenah says."
Is Microsoft intentionally making this exploitable? I knew it was only a matter of time before Recall would be compromised, but this shows they aren't even trying to secure it.
The opposite extreme is also worrisome: Imagine if they tried to make it totally opaque and impossible to read even by the user generating the data--that'd be a different kind of Messed Up.
P.S.: I'm sympathetic to the concept that "whole-disk encryption will protect this from most thieves", but I hope there's at least a little more defense-in-depth against other programs running as the user, snooping on that data without user-permission.
I mean, a malicious third-party screen-capture/keylogger program might be detectable by heuristics, but not-so-much if it can just indirectly draw from the stream of data being generated by pre-approved default program from the OS manufacturer...
It’s supposedly only accessible to LocalSystem. If they were to encrypt it, it could just be decrypted anyway. Still, it’s a huge liability and a major blunder by Microsoft.
Basically, they're a large crypto fund that has borrowed from almost every major crypto lender, and if they can't cover their margin calls (which is expected if they're insolvent), the risk of the debt is then transferred to the lenders themselves.
3AC isn’t just large. 3AC is the largest trader by volume in the world for like 4 years. Them going bankrupt is like long term capital management going bankrupt.
Its nothing like LTCM, its much worse because when LTCM the fed and SEC cleaned up by reducing interest rates and helping GS take over the positions. Crypto is "free" from govt interference like this.
If crypto bubble bursting is what precipitates the next recession I'm going to be beyond upset. Getting burned by something I purposefully stayed out of is nothing short of enraging. I'd legislate it out of existence out of spite at that point.
What's happening here isn't causing the recession, it's indicating it, for the most part. Crypto was never really disconnected from the public markets, not like it claimed it was.
Maybe the nuevo crypto gang, but OG Bitcoiners have seen enough bubbles they view them as inevitable and don’t particularly care about the reason for them.
Seen enough bubbles? They’ve only known one type of monetary policy and rate environment (essentially zero). This is uncharted territory for all crypto.
The Fed is precipitating the next recession (maybe) and also created the crypto bubble along with the stock market bubble, the venture capital bubble and various other asset inflations due to its easy/cheap money policy.
What's happened now is that the Fed has suddenly withdrawn its cheap and easy money and these people are having a wile-e-coyote moment. Currently they're suspended in mid air with nothing below.
Crypto isn't to blame, neither is the Fed (maybe), it's just the hangover from covid and the war in Ukraine.
> it's just the hangover from covid and the war in Ukraine*
No way. COVID and the war are just the straws that broke the camel's back, they just helped bring down this house of cards that was the bubble economy the Fed created purely out of cheap money I'm the last decade, and overinflated in the last 2 years.
COVID and the supply chain disruptions it caused, was the perfect wake-up call to parachute the economy back down to earth, but instead they just kept the money printer running at full speed until the war came.
How is COVID and the war to blame that the Fed quadroupled the money supply in just 2 years? How was that house of cards ever going to be sustainable?
Of course the war brought it down. And if the war wouldn't have happened, something else would have brought it down instead. It was just not sustainable.
Basically, Wall Street created a "You're locked in here with me" scenario for the entire American public. Everyone has to throw their money at some speculative asset category, typically stocks, to have a meaningful chance of beating inflation. (Yeah, real estate, fine art, and Yu-gi-oh cards exist, but they're far less fungible and liquid at the scales required)
This creates a political feedback loop: the S&P 500 must keep going up in perpetuity because we're all afraid of being 82 years old and in failing health but having to still flip burgers to afford our medication. Ergo, policies like super-low interest rates that make alternatives like bonds ever less compelling and focus ever more interest in an asset bubble.
TBH, I feel like there's a real opportunity to ask "why are we investing."
For people forced into the market for things like retirement and educational savings, maybe we need some sort of contribution-based scheme, rather than a market-price-based one. Sign up now, contribute an agreed-upon sum for N years, and you get your retirement condo/kid's tuition at Harvard prepaid in 2044. Make the institutions-- the ones with teams of actuaries on staff and the financial backstop to handle it-- eat the inflation risk instead of the individual with a net worth of $650 on a good day.
That sort of program could remove a lot of the "mere mortals who stand to lose everything" from the market. The political benefit is then it returns Wall Street to being a casino for the rich and distasteful, and makes it much easier to propose regulation or managed-growth policies. When not everyone is chained to the market through a 401(k), the threats of a market tank don't bite quite as hard.
Global crypto is a small compared to public markets, and financial institutions essentially can't incorporate them in any way that would pose any real risk. This collapse is a symptom of tightening financial conditions. People don't have free cash to throw into them any more. It seems that without that spare cash, there just isn't enough real value in crypto for it to sustain itself.
The chairman of the fed is explicitly saying they will increase interest rates until inflation is down to 2%, even if that increases unemployment and creates a recession. Crypto collapsing won't be the cause of a recession.
How is this this worse? A few people will go under immediately because they took undue risk but prices will settle to where they need to and the world will move on.
As opposed to embedding that failure into the core of the system to protect a few interests so that the same issues are surfacing 20 years later.
Very correct. Financial failure of a participant must be an intrinsic part of financial systems and currently only the anarcho capitalist plane of cryptocurrencies has that.
While I do not subscribe to the ideals of anarcho capitalism at all this is one feature of crypto culture that I think they got right.
None of it has ever happened before during a recession. Crypto basically didn’t exist the last time the world had one. Being religious and so sure about the way something is going to turn out should be a warning sign to the self.
> None of it has ever happened before during a recession
We are not currently in a recession.
If we get into a recession in the next quarter or two, there's no harm done to crypto. The market is headed into bear territory regardless of the macro economic climate.
I swear no one remembers 2017. Thousands of projects that raised billions of dollars died. No one cares. The market rebuilds itself every 3-5 years. This is absolutely no different.
You are correct that people will continue to engage in stupid gambling. The problem is they're not going to have gobs of cheap money to throw into it and get leveraged 100x on which drives a lot of the speculative value.
Great! That means people will invest in cryptocurrency projects with good fundamentals and that deliver value, instead of the pure speculation that we've suffered until now.
Rolling over our current national debt at the current rates will make the debt servicing costs too high relative to tax income. So either rates cannot stay high indefinitely, or inflation will continue until debt is smaller compared to tax income. In both cases money becomes cheap. The average maturity on debt is 5 years which is where I got that time scale, but this is also in line with previous cycle lengths-- you can't find many times where the fed has waited longer to cut rates. Debt has also never been this high as a percent of GDP, so more pressure from that shouldead to faster policy changes.
Yes, because after correcting for irrational exuberance and the economy being in a holding pattern for 2 years all the next politician has to say is that they alone can fix the economy by lowering rates. They will then install a dummy head of the Fed that will play along.
It has literally happened once before, that does not mean it is going to revive again. What if we're at crypto saturation and the demand won't cover another crash?
I have no idea if it's true, but it seems like people are writing about contagion within crypto, as if it is more substantial than last time, and worrying a little bit about it affecting the rest of the economy.
This game of lending crypto assets for ridiculous interest rates wasn't nearly as popular last time, was it?
> This game of lending crypto assets for ridiculous interest rates wasn't nearly as popular last time, was it?
- ICOs
- DAOs
- NFTs
- Yield
- Earn
- Farming
etc. All of these can be ephemeral concepts within a single crypto bull cycle. Regardless of whether or not you think crypto is valuable, there's no denying people love money. So long as crypto remains unregulated there will always be bull markets imo.
> None of it has ever happened before during a recession.
The 2020 Covid crash was a recession. A very short one, but also one of the most severe since the Great Depression. Bitcoin crashed from about $10,000 to $4,000 in the span of 3 weeks, before recovering and peaking at nearly $70,000.
What people are entirely missing here is the massive economic indicators flashing that are preempting this crypto stuff. The US dollar is about to be devalued and take with it, the entire global economy. We're heading into a serious depression, not just a little 2008 recession here. $9-10 gal of gas by October and double of all goods and food prices likely by Sept-October time frame. The outlook is growing very bleak.
In and of itself, yes. But there's a real risk (far from a certainty, but a real risk) that it will cause some kind of crisis of confidence in the markets more broadly that could result in a much more catastrophic crash.
Hopefully this time, we get some regulator action so we're never back here again. Each time the cycle gets bigger, the tendrils work their way into traditional finance - and more people get hurt. This time, the Quebec public servants are getting rekt on their investment into Celsius [1]. Now it's hurting pensioners, not just a bunch of degenerate gamblers and moonbois.
It's fine for a bunch of pokemon card traders to get rekt - but by the time you get to 3AC scale, it's time for regulators to put the kibosh on the whole space. They're securities. They either get registered or you go to Club Fed.
With all due respect, fingers crossed, this time it does not work out.
> Now it's hurting pensioners, not just a bunch of degenerate gamblers and moonbois.
No, that's your public institution making degenerate gambles on late-stage startups. The largest venture capital investor in Canada isn't some poor victim, they are the perpetrators, the owners. It's completely laughable to paint them as a victim of some crypto-ecosystem heist.
The victim is the pensioners, not necessarily the gambling fund. "regulator action" can refer to simply preventing sensitive/prison funds from going into certain classes of risky ventures, and not regulation against crypto itself.
I take the position that cryptos are clearly securities under the Howey test. It's pretty self-evident. As such, they must be registered in order to be traded by anyone other than an accredited investor. To be clear, this is the law of the land today. All that's missing is regulatory enforcement action.
Question: what is the point of crypto if it becomes regulated like traditional financial assets? Crypto doesn't have any actual use-value like stocks or real estate, and its entire selling point was that it's decentralized and unregulated.
Simplifies and modernizes cross-border flows. Try buying shares in a firm listed on the Indonesia Stock Exchange—you’ll spend days to weeks dealing with middlemen. Should be a couple clicks to submit to a public ledger.
I don’t see where lack of regulation is a selling point—it greatly limits invested capital.
As far as I can see, https://wise.com/us/ is in all ways a better way to simplify cross-border flows than crypto. When working with overseas teams, it is literally how they ask to be paid.
Isn't the reason buying international shares is slow that they don't want you to do it and therefore have regulated it?
There's no technical merit in crypto that actually makes things fast, it's just a regulation dodge. It's necessarily slower and more expensive than TransferWise.
They have decided it's better to avoid their local businesses being beholden to foreign investors, which is a case that can be argued.
If you're being directed mostly by overseas investors who will never see your actual operation in person, that increases the pressure to cook the books, either on a direct accounting-level basis, or by cutting corners in operations, environmental or labour standards, or product quality.
Notice how some countries insist on joint ventures with a 51% local partner, which similarly ensures there's some local skin in the game.
No - crypto does nothing for cross-border flows. It could only make it worse. Purchasing shares in foreign countries say France often (not always) requires one to go through an approved French broker (middleman). Why?
- so there's somebody in France that can *make money* being the middle man
- so the French broker can be held to some standards reporting and what not. For example, the French broker at risk of criminal prosecution cannot sell shares to NK or Iran.
- so the rules around transfer of shares for payment and settlement are set so people can't be screwing each over or not completing settlement in a timely fashion
- because of scale: there are zillions of trades done every day. that's why netting-out is a real thing. settlement has to be fast, tight, nailed down. And regulation helps with that through known pre-approved brokers with set roles and responsibilities
Also consider that unlike crypto you gotta settle. Settlement is serious. And settle in a bonafide currency that everybody agrees is a currency: EUR, for example. And you have fixed time to do it in.
You can't be waving your hands with some stupid story about how your broker/holder of crypto,
- stopped you from withdrawing your stuff
- is down
- is in chapter 7 or 11
- that you forgot your crypto keys
- and the entity getting the cash for selling shares isn't gonna wait around for some miner to "approve" your transfer maybe in 10 mins ... or maybe tomorrow
I think the settlement story for bitcoin is actually superior than with USD/EUR. Yes you have to wait 10min x a few blocks, but that is final, irreversible settlement.
I mean, so is FedNow and RTP and SEPA - the list goes on and on - none of which are blockchain powered. They settle instantly and finally. In the case of international transfers, the delay is intentional for regulatory and risk management purposes. Not technical reasons. So the advantage of crypto isn't technology but regulatory arbitrage.
These work if you either have a master fed account or have credit with some bank that does. You can't settle instantly with an entity that is not already known in the system.
Do you think a bearer asset like cash has zero use cases? Bitcoin allows settlement much like this with a party that doesn't need to be identified and already trusted by a central clearing house. Of course this can be dangerous and might not be desirable for every transaction, but there clearly a technological achievement to make it possible.
Proposing opening an LLC is a pretty involved workaround that again requires more supervision and gatekeeping (e.g, for many people and many countries this is not even possible). Cash like settlement with any person on the planet without any intermediary is a pretty big technical achievement that absolutely was not possible before blockchain.
Except for the possibility of unconfirmed transactions if the network is under load right? With both centrally registered clients and counterparts what’s the case for decentralisation here again?
If the network is under load you can prioritize by paying a higher fee. If mining slows down it can take more time for a block, but difficultly will adjust to get back to 10mim cadence.
I'm not sure what you mean by centrally registered clients. You can still use bitcoin peer to peer. Also the idea that banning peer to peer bitcoin would be what would make decentralization not worthwhile feels rather circular.
Surge pricing to settle stock trades? Obviously this is worse than the existing tech
To trade you need to be registered by regulated entity, it’s already a centralised environment. You’re also purchasing shares issued by a centralised issuer, the corporation. Your suggestion that bitcoin offers any solution to settlement (much less a superior solution), just escapes me
I'm not sure why you are talking about stock trading. Settlement is a general, non stock specific thing. I'm talking about settlement in regular transactions, e.g. paying rent or buying groceries.
"Crypto doesn't have any actual use-value..."
Same can be said for most financial instruments yet they're regulated. Gambling has no "real world use-value" yet it is heavily regulated.
There was never any in crypto either. Anyone who thought so is just as stupid as the HN'ers that think cryptocurrencies are bogus. Thinking a few over leveraged crypto companies getting wiped out will destroy cryptocurrencies is laughable.
for commenters assuming the US Government would step in, absolutely not. the death of Crypto is inherently in the interest of US foreign policy as it strengthens regional soft power in denied spaces by gutting uncooperative states (iran, venezuela, cuba, etc...) of their ability to sidestep western capital embargos. it also guts Wikileaks ability to defend itself in court, as its sitting on a good deal of crypto since being denied access to regular donations.
it also helps dampen inflation by strengthening the dollar, at whatever level that may be.
I like crypto, though not really what it has become in recent years. I too hope the US government does not step in. That would be totally antithetical to the entire point of crypto.
The situation is not entirely clear because some lenders may not loudly announce that they have liquidity issues as early as possible. It seems like a large part of the forced selling by 3AC and counterparties is already over, and it seems like many counterparties don't actually have any collateral from 3AC to sell and must eat the loss.
The answer is probably yes for both questions. These crypto and loan contracts are typically very complex and involve many classes of crypto and physical assets involving many 3rd parties. Therefore it's going to take awhile to untangle things to the point where each party knows their precise risk exposure and ability to take loans out against this exposure/loss.
Matt Levine had an aside in one of his recent columns about how ironically, "safe" investments are frequently the most un-safe, because the tiniest crack in the faith people have in them leads to panic.
For instance, the stablecoins.
Bitcoin itself doesn't seem to be vulnerable, exactly because there's no particular objective value. If it goes down 90%, well, nobody promised it wouldn't.
Sounds as if that's somewhat related to J.K. Galbraith's variant of Gresham's Law, in which "bad assets drive out good", during a crash, as the need to cover obligations as bad assets tank leads to sale of quality assets / securities.
From The Great Crash: 1929. One of my favourite books.
> Safe assets are much riskier than risky ones. This is I think the deep lesson of the 2008 financial crisis, and crypto loves re-learning the lessons of traditional finance. Systemic risks live in safe assets. Equity-like assets — tech stocks, Luna, Bitcoin — are risky, and everyone knows they’re risky, and everyone accepts the risk. If your stocks or Bitcoin go down by 20% you are sad, but you are not that surprised. And so most people arrange their lives in such a way that, if their stocks or Bitcoin go down by 20%, they are not ruined.
> On the other hand safe assets — AAA mortgage securities, bank deposits, stablecoins — are not supposed to be risky, and people rely on them being worth what they say they’re worth, and when people lose even a little bit of confidence in them they crack completely. Bitcoin is valuable at $50,000 and somewhat less valuable at $40,000. A stablecoin is valuable at $1.00 and worthless at $0.98. If it hits $0.98 it might as well go to zero. And now it might!
Holy crap I had no idea this was Galbraith's insight. I've heard William K. Black talk about Gresham's dynamics a few times, but always wondered why his use of the term didn't comport with Wikipedia's article on it. It's because he's using it in Galbraith's sense. I'll be checking out the book for sure. Thank you.
Do read the book, it's excellent. I'd finally done so myself only after the 2007-8 meltdown and found it hugely useful.
The passage I reference is toward the end of Chapter VI:
Never was there a time when more people wanted more money more urgently than in those days. The word that a man had "got caught" by the market was the signal for his creditors to descend on him like locusts. Many who were having trouble meeting their margin calls wanted to sell some stocks so they could hold the rest and thus salvage something from their misfortunes. But such people now found that their investment trust securities could not be sold for any appreciable sum and perhaps not at all. They were forced, as a result, to realize on their good securityies. Standard stocks like Steel, General Motors, Tel and Tel, were thus dumped on the market in abnormal volume, with the effect on prices that had already been fully revealed. The great investment trust boom had ended in a unique manifestation of Gresham's Law in which the bad stock were driving out the good.
-- John Kenneth Galbraith, The Great Crash: 1929, chapter VI
NB: In re-typing the above passage, I managed to render "hold" as "hodl". I've fixed that, but note the fact here...
Frankly, this sounds like a feature rather than a bug. Speculation of this type is high risk/reward. If this guts the lenders, that’s a good thing - they’re not treating this with the appropriate amount of respect for speculating and protecting their balance sheets.
Reminder to everyone that one of the private equity firms that acquired LogMeIn and took it private, Francesco Partners, holds a majority stake in NSO Group, an Israeli spyware developer.
In case you haven't already, you should submit a request to delete all your data as a Mailchimp "Contact" (a "Contact" is a person whose contact info was given to Mailchimp by a Mailchimp "Member"):
Seems like wufoo (the form service they use for that form) is having a bad day, the form won't load for me.
It also feels a bit ironic that to ask mailchimp to not store my data I need to send that request via another company, do I need to ask them to delete my data too?
"Dubbed TotalRecall—yes, after the 1990 sci-fi film—the tool can pull all the information that Recall saves into its main database on a Windows laptop. “The database is unencrypted. It’s all plain text,” Hagenah says."