I don't understand this at all. The books being sold are all new, so unless they're being pirated or are being sold through some other fraudulent means, don't they all have to have come directly from the publisher?
The Vox article suggests that the books may be promotional copies that were sent out, but surely there can't be that many promotional copies for a given book (compared to a regular print run). And these promotional copies are controlled by the publisher in any case, presumably they feel that the potential loss of a sale is offset by the promotional value.
Part of the issue here seems to be that there aren't that many of these gray-market books available, but that when they sell out the buy box doesn't switch back to the publisher immediately.
I am with 1. What exactly is the problem here? Even "grey market" (whatever that is) books must ultimately have been sold by the publisher to someone. The length of the value chain doesn't really seem to be an issue here.
And if the problem is that third party sellers can buy books really cheap from publishers and then resell them for more, and the publishers feel that's not fair, well, that sounds like a problem that the publishers have the power to solve by not selling off their books really cheap.
Really, if your business model involves selling something directly to the public for $12, or selling the same thing for $3 to someone who plans to sell it to the public for $9, then you might want to look closer to home than Amazon for the reason why you aren't doing very well.
The publisher donates for free a limited number of copies to reviewers etc. in the interests of publicity. Reviewers etc. usually flog these to second hand book shops, who sell them as review copies at slightly higher prices than properly used ones. But as Commenter points out, there aren't all that many of these, so when they run out the software should revert to the publisher automatically. If it doesn't it's crap - either crap spec or crap implementation.
The Vox article suggests that the books may be promotional copies that were sent out, but surely there can't be that many promotional copies for a given book (compared to a regular print run).
Two thoughts: (1) If, as the Vox article mentions, there are Man Booker prize nominated books that only sell 3000 copies, the number of promotional copies could be higher percentage than you think. (2) What really matters isn't the ration of [promotional copies] to [total print run] but [promotional copies] to [copies sold on Amazon]. (3) In addition to the problem of books showing up as unavailable, it also doesn't seem great if the sellers who most consistently sell promotional (or books pulled at the warehouses) items will be most likely to rank as the favored seller (if they consistently have lower prices).
One other note, despite the post title I was thinking, as I wrote it, that software has improved. It does seem like there are fewer of these sorts of stories than there used to be. But it still seems like a classic example of programmers attacking a programming challenge without having a good sense of the full set of considerations.
7.1: but most 3000-sale books are not Booker nominees and will receive nothing like the publicity push that Booker bait gets, and so nothing like the number of promo copies.
And the conclusion to the article - oh how awful, books are selling cheaply and this makes it hard for black and female authors - needs to be balanced with how much easier it makes life for black and female _readers_ who are thus able to afford more books.
And the conclusion to the article - oh how awful, books are selling cheaply and this makes it hard for black and female authors - needs to be balanced with how much easier it makes life for black and female _readers_ who are thus able to afford more books.
Not necessarily true. The cheap books were always available; it just required clicking through to the list of marketplace sellers (which, you could argue, functions as a very weak form of price discrimination in that the people who are price conscious can spend slightly more time to find the best price and the people who just take the first option offered to them pay slightly more).
This story doesn't make any sense without an explanation of where the cheap books come from. It really seems implausible that promotional copies are a big enough source to be a problem.
This story doesn't make any sense without an explanation of where the cheap books come from. It really seems implausible that promotional copies are a big enough source to be a problem.
9: well you can't have it both ways! Either it is reducing the average sale price of books or it isn't!
This story doesn't make any sense without an explanation of where the cheap books come from. It really seems implausible that promotional copies are a big enough source to be a problem.
I agree, and was hoping that parsimon might be able to fill in some of those details. The comment in the article, "No one is quite sure where their books come from, including, it seems, Amazon itself." is odd.
It does sound like the problem isn't just Amazon but various grey areas in the publishing business which serve a purpose as long as nobody is actively trying to exploit them. Alternately, it could be a case the music industry which, over time, built up a variety of unofficial cross-subsidies which made it vulnerable to competition not just because it was inefficient but because it meant that you couldn't change anything without messing up something which was, by convention, an important source of money for somebody down the chain.
9: well you can't have it both ways! Either it is reducing the average sale price of books or it isn't!
That's only true if everybody pays the same price (which clearly isn't the case). You could bring down the maximum prices without changing the lowest prices and lower the averages without benefiting the most price-sensitive consumers (who had already figured out how to get the lowest prices).
Either it is reducing the average sale price of books or it isn't!
It can be reducing the average sale price for purchasers who, for one reason or another, would never have looked to find the already-available cheaper options. Really price-sensitive purchasers might have been doing it all along.
I wasn't sure if the subtext of the article was "we think they're stolen but can't prove it" or not.
The economics of Amazon are weird in general. There was a story on the radio a few weeks ago about some guy who specialized in finding clearance sales on things like diapers, buying in bulk, and then reselling on Amazon. Apparently he consistently made money.
The problem is indicated in 1 upthread:
The books being sold are all new, so unless they're being pirated or are being sold through some other fraudulent means, don't they all have to have come directly from the publisher?
Nope. Amazon doesn't require that books advertised by third-party sellers actually come from the publisher. Amazon's requirements for calling a book "New" simply mandate that the book, well, looks new. Cutting-and-pasting from Amazon's condition guidelines (for sellers):
New: Just like it sounds. A brand-new, unused, unopened item in its original packaging, with all original packaging materials included. Original protective wrapping, if any, is intact. Original manufacturer's warranty, if any, still applies, with warranty details included in the listing comments.
As you can imagine, this is, and has been, a huge source of controversy among booksellers. The fact is that nothing there makes mention of provenance: it speaks simply to condition of the book. People have therefore been listing what you might call 'new condition' books as officially New for many years.
There are all kinds of nuances here, which I can natter on about, but that's what it comes down to: unless and until Amazon decides that "New" means from the publisher, complete with proof to Amazon by the seller, it doesn't.
16: That's known as 'retail arbitrage'. Very popular on Amazon: there are, or so I gather, even Youtube tutorials coaching prospective sellers on how to do it, as well as consultants offering to teach you a course on it, for a fee. This has become an industry.
This story doesn't make any sense without an explanation of where the cheap books come from
A third-party seller can buy out an independent (new) bookseller who's going out of business: they may have stock in the back room that goes back years. A seller can also buy excess copies from a publisher who's ditching their print overruns: this can happen in university towns where there's a university publisher. Or, and this is not uncommon, a seller may have bought a box or two of something from the publisher upon original publication a decade or few ago, then stored it, sat on it, until it gained (or regained) value or interest. You can also just pick this stuff up at auction, brand spanking 'new', in multiple copies. Depends on where you're located.
I'm on the couch. I've been lazy this weekend.
16: It kind of seems like vultures, except for diapers.
At least with diapers it's probably pretty obvious whether they're new or used.
At 3:00 a.m., I've argued with a baby about that.
At 3:00 a.m., I've argued with a baby about that.
Stupid, updated browser on the phone.
I'll lastly note that this development on Amazon isn't really about programming algorithms (although there's a big issue there, the place is more or less run by 'bot): it's about Amazon's profit margin. They just don't make much money selling New books. They have to store the shit, the warehouse costs are high, they offer free shipping ... when they sell third-party New books, they make an absolute minimum of $2.40, with no work on their part. It's generally smart to remember that Amazon's own interests are the answer to any question about it.
16: That's a pretty common thing for people to do since the early days of Ebay. A hell of a lot of Amazon's offerings for third party sellers were an explicit move to siphon business off from Ebay.
Christ, has it really been 9 years since I left there?
Heck, now people offer things for sale on eBay that they don't have (in stock), and if you buy it, they order it more cheaply off Amazon to be shipped to you.
He was! A great bargain!
27: It was the mundane nature of the items that surprised me. I just wasn't aware that significant numbers of people were using Amazon to buy things they can get at the nearest supermarket or convenience store.
Not for books specifically, but a lot of Amazon's search algorithms have been hacked in the sense of getting things to show up when they shouldn't to drive more business to sellers who have figured this out. This includes having a number of similar items for sale with one "bait" item listed as Prime or free shipping, so you go to that item, but as soon as you change size or color to what you want it's no longer free or isn't in stock for a month. It also includes outright lying about availability or shipment times. Both of these happened to me in the past week, and Amazon doesn't care because they get their slice either way.
31- Crazy, isn't it?
I mostly use Amazon for books (Kindle) and, because I suck at Christmas, toys.
Because I also suck at giving $150 to Sears.
36: Sears sucks at taking your money or anyone else's.
All the kids are buying their hot pants and flannel shirts at Montgomery Wards.
I made several hundred dollars in grad school by buying books for 80% off during university press sales (first checking that the relevant books had a higher resale value on Amazon) and then reselling them on Amazon. Didn't have time to turn it into a large volume thing but it was a good way to earn some additional booze money.
You could have increased the profit by cutting the literature with phone book scraps.
Over the course of two years commuting past the Mountain View Sears, I saw its inventory liquidated, doors shut, signage taken down, site fenced off, and finally the entire structure razed to the ground and replaced with Silicon Valley's New Intersection of Creativity, Business and Life.
Sears is an example of a once proud company run into the ground by an asshole hedge fund manager with shitty management ideas.
Lampert runs Sears like a hedge fund portfolio, with dozens of autonomous businesses competing for his attention and money. An outspoken advocate of free-market economics and fan of the novelist Ayn Rand, he created the model because he expected the invisible hand of the market to drive better results. If the company's leaders were told to act selfishly, he argued, they would run their divisions in a rational manner, boosting overall performance.
Somehow the invisible hand of the market didn't fire him years ago.
The Oakland Sears was sad and low-trafficked as long as I've been here. Closed 2014. Supposed to become the new Uber HQ, though I think Uber is rolling that back.
I saved several hundred in grad school because my first year was the end of the dot com bubble, I bought my books from an online book seller that was so incompetent they just never bothered to process my payment.
The downtown Oakland Sears seemed ok, or at least not remarkably bad, when I worked nearby in 2000-2001. And downtown Vancouver's Sears was actually pretty good 2009-2012. But you can't argue with Howard Roark and John Galt. They knew how to build and sustain businesses in the real world.
I'd read the link in 42 before but for anyone who hasn't it is well worth a look.
32: I'd say a 1-star review is called for there?
Oh, related:
THE MAD KING OF JUICE
http://gizmodo.com/the-mad-king-of-juice-inside-the-dysfunctional-origins-1795330639
Several employees related an anecdote in which flies had begun cropping up in the company's San Francisco office. Evans--a vegan who at one point only allowed his employees to expense vegan meals on business trips--refused to implement a solution that would kill them.
"They were relying heavily on influencers--Rich Roll, Beyonce, Oprah Winfrey, Gwyneth Paltrow, on down the line," a former employee told Gizmodo.
"Influencer" is definitely a trend to watch. Especially since the current US president seems to consider himself the Nation's Influencer.
In an interview with Recode, Evans is blunt in stating his beliefs about chi--a life force concept present in ancient Chinese medicine--and its apparent inability to remain within foods that have been exposed to heat, even the heat produced by other, inferior juicers.
Oh thank the gods there is still some juice left in the Juicero story after all this time.
Cross my palm with silver, dearie, and I will gaze into my crystal ball...
50: it really is. It's like something out of a Batman film. And not New Growly Batman. Not even Weird Tim Burton Batman. Old Adam West Batman.
It's out of a Woody Allen movie. Specifically, the orgasmatron in Sleeper.
I've been thinking of becoming an influencer. Wouldn't it be great if everybody cared what consumer products I endorse? Seems like a good gig.
"I'm Spike and I approve of this juicer."
I learned all about chi from a Jackie Chan cartoon.
As described, chi has a lot in common with e-coli.
If e coli can help you find the talismans, it's probably worth it to shit yourself for a bit.
Quite impressive for a hedge fund manager not to know the difference between a real market and a monopsony.
They can tell their ass from a whole in the ground, provided nobody has shit in the hole recently.
54: Juicero and the Fyre Festival do seem to go together very nicely in a conceptual sense.
It reminded me of Hitler playing with the globe in The Great Dictator.
Kelly Ripa and Ryan Seacrest are far more dull than the other people who have participated in this abomination.
I think I'm starting to understand how retired people vote for evil.
SHOOBER: Uber for Shoes.
With SHOOBER you don't actually need to own any shoes any more. Just put your style requirements for that day, that evening, or that moment into the app, which already has a laser-scanned 3D model of your feet, and a pair fitting the occasion will be droned to you within the hour, saving vast amounts of space.
SHOOBERFACT: Did you know that the average woman in London owns 36 pairs of shoes? And that these shoes take up a total of six square metres of floor space in her bedroom? And that therefore if only 10% of London women signed up for SHOOBER, it would free up enough living space inside the M25 alone to house twelve thousand key workers and their families and still have room to house every single homeless person in the Greater London area?
SHOOBERFACT: According to the Consumer Product Safety Commission, every year 70,000 Americans suffer injuries severe enough to require emergency room attention from their footwear. Another 2.8 million Americans suffer less severe footwear-related injuries (blisters, sprains, trip-and-fall injuries) every year.
SHOOBER research suggests that at least 42% of these injuries were the result of wearing THE WRONG SORT OF SHOE. SHOOBER's proprietary algorithm will use data derived from your social media profile and geolocation data to identify THE RIGHT - AND SAFEST - SHOE FOR YOU. Planning an evening of dancing with girlfriends? SHOOBER won't let you go out in ludicrous six-inch heels. Planning a hiking trip? SHOOBER will ensure you get boots that fit and are well broken in. At a cost of $5500 per ER visit, this is a burden on the US healthcare system that only SHOOBER can lift.
SHOOBERFACT: 42% of marriages in the UK end in divorce. SHOOBER research has revealed that joint shoe shopping trips are the third most common triggering event for a divorce in England and Wales, behind only "infidelity" and "financial strain". With SHOOBER no one need ever be dragged along by their spouse to buy shoes again. We estimate that adoption of SHOOBER by just 20% of women will save 150,000 marriages from dissolution every year in England and Wales alone, an incalculable benefit for the health, financial security and happiness of the British people.
SHOOBER is not just trying to revolutionise your footwear solution - we are trying to make a better world.
I would totally sign up for SHOOBER instead of buying a pair of shoes for Tatsu to wear once to his prom and grow out of straight away. Oh, the relief of not to have to face yet another round of unnecessary expense combined with teenage male whinging about the awfulness of shopping! (Actually I'm just threatening to drag him round the charity shops.)
68: Clearly someone needs to start a grocery delivery service called GOOBER.
Disinclined to receive ER care from shoes, tho.
I apologise for not using the word "disrupt" in 68.
It's easier not to ask for forgiveness than it is to seek permission.
I mean, the argument for ridesharing is that cars are an underused asset because they are idle 95% of the time. But average utilisation for shoes is about the same as that. You aren't wearing any shoes at all for at least a third of your day, and for the other two-thirds you are wearing one of, say, ten pairs of footwear: I make that about 95% idle.
And people only wear shoes around the office because they couldn't monetise not wearing them. Shoober unlocks value by offering its e-cobblers sanitary slippers so they can put their footwear to work during the day!
With flexible demand-based pricing, market forces will rationalise people's footwear choices to optimise utilisation. The canny SHOOBERer will be saving money in the office by wearing, say, mukluks, or wellies, or flip-flops, or sollerets.
81 I'd expect sabots might become in high demand.
82: I could be a sabots goy, but I really like to keep my Saturday's flexible.
I like to use extra apostrophes some times. It gives me the common touch.
Schedules, apostrophes, Moby is just a flexible guy all 'round.
Anyway, they're just making it hard on themselves by ignoring Jesus.
Meet people who share your interest in disrupting things with our new app, Sabotr.
Live stream video as your phone jams the gears of late capitalism.
Speaking of software eating the world, does anyone have a good explanation for why bitcoin exchange rate is shooting up so rapidly? Nearly doubled in the past month to >$2,200.
92. No explanation, but there's now a second blockchain currency, Etherium, that gets traded. Last I checked months ago, the blockchain for BTC was controlled by several Chinese groups, who resisted technical changes to improve confirmation times. Looks like that time is now over 4 hours.
I haven't been watching the news for reports of exchanges running off with all the money, but they are just as unregulated as they were every time I have read about it. So, bubble, I would bet that any short-term changes are driven by new behavior from China's financial authorities.
I think they got a bump from the hack but were climbing before then too. I was thinking maybe a beneficiary of things-gonna-collapse paranoia like gold (not logical, but maybe from the POV of those trading in both), but it looks like gold cratered after Election Day and rebounded after Christmas, so who knows.
Yeah, China has been imposing capital controls (even more than before), so bitcoin has become a favoured way of getting money out of country.
People have created a currency that's actually called "etherium?" This reminds me of Juicero, the Fyre Festival, and people buying thousand-dollar t-shirts that say "I don't deserve my money, you should take it."
Are there Chinese-language reports of exchanges between BTC and actual currency running off with the assets? Where (that is, what cities) do Chinese billionaires who have bought BTC go to turn them into bankable currency? I had read that Macau was popular.
"Etherium" is a term created by World of Warcraft. It describes the technology used by etherials, a race of people who are invisible but for bandages wrapped around them that constantly flap in the breeze, native to another dimension with different laws of physics, and intensely capitalistic. They're the Ferengi of a more magical and less sci-fi universe. Actually, WoW also has goblins that could be described that way. Etherials are a more ephemeral version of goblins.
The etymology of the word, of course, comes from ether, the Aristotelian concept for what makes up outer space, based on a grasp of the scientific method that's basically just "well, it stands to reason that nature abhors a vacuum, so there must be something there, right?"
I literally can't imagine a more unreliable currency. I guess they could have actually named it "vaporium" or something?
99. The codebase is stable and useful enough that both JP Morgan Chase and RBS are paying programmers to create essentially private versions which they'd control.
The social and regulatory issues (what happens if someone unsavory builds/captures more than half the issuing/validating computational resources? Who checks that the exchanges between blockchain and real money are honest/sufficiently capitalized?) are still present with Ethereum as far as I know. Only the problems associated with having majority control inside the PRCs firewall are gone.
Didn't we have a thread here on an Ethereum incident a while back? It was trying to allow for contractual arrangements in code form and someone said "look, I stole your money fair and square"?
I literally can't imagine a more unreliable currency.
Right. As soon as Michelson and Morley do their experiment and Einstein comes up with special relativity, it disappears!
thousand-dollar t-shirts that say "I don't deserve my money, you should take it."
The 30 seconds or so when I thought this was real were kind of exciting. Somebody really should print and sell these t-shirts.
Ethereum is cool technology, but the problem is that it occupies an ecosystem filled with greedy idiots. The idea is that it supports "smart contracts" which is a dumb name for "logical computing framework that can be shared across organizations."
That's actually quite powerful because it provides a digital commons that isn't controlled by any single entity, which is not really possible with other technology. Right now, when organizations want to share data and code, its a centralized model where one organization owns everything and provides APIs so that others can get access. But then if that organization decides to change things up (like Google does all the time), everyone else just has to fall in line and do what they say. Which kind of sucks. Decentralization through Ethereum provides a model for common ownership/management of the computing infrastructure, which is cool.
But the problem is, this is all very new and coding these smart contracts is actually quite difficult. So, last year a bunch of idiots went gung-ho and created "The DAO," but were so eager they overlooked the bugs in the code which allowed someone to steal all teh moneys. $60 million was taken.
So, after a bunch of controversy, the Ethereum blockchain had to be rewound to get all teh moneys back. Which actually ended up being a great thing because all the people who were philosophically opposed to exercising that kind of governance left to go use a version of the blockchain from which all teh moneys had remained stolen. Which meant the main project could proceed without having a to bring along all the stupid libertarians and their anarco-capitalist baggage.
Anyway, a few months ago I bought a bit of Ethereum to fuck around with for an application I was developing. They cost like $11 at the time. For reasons that are not at all clear to me, its now worth $162. I'm looking to sell that shit very soon. Alas, it will only be a modest payday as I did not initially purchase enough to get filthy rich.
104. Interesting! How do you find a trustworthy exchange to turn the virtual currency into real money? Is there any kind of auditing of either exchanges or stores?
Governments are figuring out that exchanges can be regulated. I'm not saying that Mt. Gox won't happen again, but it should be a bit different now that the State of New York, for example, is all up in their shit.
Also, once you buy, be sure to take your jonx out of the exchange. I made the mistake of leaving most of mine in Coinbase, which is a problem because I subsequently lost the phone I use for 2 factor authentication, and getting my access back has been a pain in the ass.
On the one hand, I'm glad I don't understand this. On the other hand, all my wealth is denominated in a currency based on bankers who will now be picked by Trump.
Trump seems to have pretty mainstream taste in bankers, based on his appointments so far.
Well, of all the things in American life that Trump wants to ruin, I don't think money is one of them.
Yes, but he's also bugfuck crazy and incompetent.
And bought off by the Russian, probably.
Bugfuck crazy and colluding with Russians.
"Etherium" is a term created by World of Warcraft.
The guy who created it was big into WoW back in the day.
You should click on that link just to observe that the guy is the platonic ideal of what you would think the guy who invented Ethereum would look like.
Isn't this a law school hypothetical come to life?
117. Whoa. Though I wouldn't have gone with describing her smile as "intoxicating" when she was shot by a boyfriend whose blood alcohol level was three times the legal limit.
There's no picture of her, so you don't know that isn't the best word.
Maybe that's why men tell women to smile? They think it will get them drunk.
Anyway, three times the legal limit isn't as impressive as it used to be before they made the legal limit .08.
||
NMM to Roger Moore.
A hammy Bond but a very good Saint.
|>
How did we make it this far with all the Bond actors alive?
"21", the company in 122, seems to have pivoted. Previously they were known for having had the dumbest idea in bitcoin (which is saying something.)
Their plan was to manufacture a chip that could be installed in people's phones and other devices which could be used to mine bitcoin when the device wasn't being used for other things. Because every consumer wants the ability to drain down their battery in exchange for micropennys.
And Sean Connery stared in both "The Avengers" and "The League of Extraordinary Gentlemen."
Actors with good agents die but once, is my point.
Non-canonical and invisible, respectively.
128 is a good point, though. He's dead inside.
Belatedly realized I forgot to post that Close to the Machine is really good.
Kik is now on the blockchain with its own cryptocurrency, for some reason I can't understand.
Too much lead in the air when you were a child?
I do wonder if all these companies rushing to get on the crypto bandwagon realise quite how large an AML liability they are creating for themselves. Move quickly and break things is great until you get slapped with hundreds of millions in fines by securities regulators.
I would be very interested to read as much more about 134 as you cared to type.
If you break enough things, you might break the securities regulators.
Move quickly and break things is great until you get slapped with hundreds of millions in fines by securities regulators.
Yeah, they are kind-of in a tight spot.
There is a lot of ridiculous, stupid money being thrown around right now, and that's not going to last forever. If you are creating a business, you want to get some of that while you can. The problems is that its clear that securities regulators are way behind what the market is doing, so any company that takes advantage of these new financial instruments is running a legal risk.
However, there is a sense that "but everyone is doing it now" and its true that there is some safety in numbers. I think its unlikely that a Trump Administration SEC is going to come down hard in this area. If there is action, the thinking is that a regulator would pick out one or two of the more egregious players and have them serve as a warning to get the others to clean up there act. And a lot of times, SEC fines are basically a slap on the wrist anyway.
I don't have much more original to say - it seems pretty obvious. If you're in the business of facilitating anonymous currency transactions on a massive scale and you don't think about AML/KYC, as very few of the not explicitly "fin" tech companies seem to, sooner or later the regulators are come down on you like a ton of bricks. So far they seem to have been getting away with it by either being pie in the sky, based in jurisdictions with weak AML enforcement, or relying on the fact that BTC/ETH hasn't been classed as a currency in most major jurisdictions. That is changing.
Of course, its not just the SEC they are dealing with. The insanity of Federalism means companies have to work out compliance for each of the 50 state jurisdictions as well. That's kind of nuts.
They handle it better in the UK where there is a national regulator that has this thing they are calling a "regulatory sandbox." As long as companies keep the regulator informed of what they are doing, and stay within some broad parameters designed to prevent outright fraud, they can get a "letter of no objection" from the regulator that provides some assurance that they won't be shut down for going outside the boundaries of whats been done before.
If you're in the business of facilitating anonymous currency transactions on a massive scale and you don't think about AML/KYC, as very few of the not explicitly "fin" tech companies seem to
I think you are describing the situation as it was four or five years ago. These days, its generally admitted that bitcoin isn't really anonymous, and companies recognize that they need some level of AML/KYC if they want to be in the finance game.
And so most of them are doing it, grudgingly. You can get KYC as a service now.
The thing is, it probably wouldn't even occur to Kik (or a UK based equivalent) to talk to the FCA. They talk about requiring proof of identity/address for the initial distribution, but there's no talk of ongoing compliance mechanisms. It's like those guys who set up an exchange to take bets on tech firms going public. It didn't even occur to them they were running an unregulated derivatives exchange, because they're just tech guys playing with tech, right?
I think you are describing the situation as it was four or five years ago. These days, its generally admitted that bitcoin isn't really anonymous, and companies recognize that they need some level of AML/KYC if they want to be in the finance game.
Sure, I think this is probably fair. My concern is with the companies that don't seem to realise they are in the finance game.
The thing is, it probably wouldn't even occur to Kik (or a UK based equivalent) to talk to the FCA.
Kik is run by some very deliberate assholes who once broke the internet and got away with it. Rest assured they are paying lawyers good money to make sure they are protected.
My concern is with the companies that don't seem to realise they are in the finance game.
I think a huge proportion of these companies are founded by kids who invested in bitcoin early on and now have shitloads of capital. The companies are new, but the people behind them aren't really neophytes in the space. They know that "FinTech" is finance.
Just saw this explanation on Slashdot for the Kik move: "Kik is positioning themselves for cam girls (and boys) to get paid."
Makes sense. There is gold in them thar hills.
143 needs a bit more explanation. Two coders having a scuffle doesn't break the Internet.
This whole discussion is full of unexplained acronyms and jargon. I haven't understood most of it.
AntiMoneyLaunering and KnowYourCustomer.
If you offer bank like or securities exchange-like services, even if it's just some cool code you slapped together and started quietly making a little money with, there are branches of government who would like to meet you.
143 needs a bit more explanation. Two coders having a scuffle doesn't break the Internet.
Basically what happened was that the Kik's lawyers put pressure on NPM (package manager to the node.js ecosystem) to hand over this one guys' package name to the company. Perceiving that he was getting the shaft, the guy yanked all his stuff out of NPM. This included an small package that turned out to be used by a ton of other open source projects. When that wasn't there it broke everybody's builds and a whole lot of shit had to be fixed. It was also an object lesson in why the proliferation of the sprawling-dependency-tree school of software development is maybe not the greatest technology trend in recent years.
Not entirely Kik's fault, but the thing was triggered by Kik being assholes to this guy in a way that is a anathema to the way open source development should work.
I can still defraud people by selling shitty services that aren't exchange-like, right?
I can still defraud people by selling shitty services that aren't exchange-like, right?
I think the line is whether you can be considered a Money Service Business and therefore subject to regulation. This generally entails either holding or transferring money on behalf of others.
Which means that, as long as your business is limited to selling a bunch of digital pogs on the blockchain you can avoid being subject to money laundering bit, provided that at no point are you in custody of someone else's money.
This is the business model for all these"Initial Coin Offerings" that are being put out there, which is essentially what Kik is doing. A standard called ECR20 has emerged that basically enables anyone to issue whatever tokens they want, and, as long as the tokens meet the standard, they can be traded on various exchanges. As long as Kik itself is just issuing the tokens, rather than providing the market for them, they can avoid dealing with all the messy "Know Your Customer" stuff. The burden of KYC then falls to the exchanges.
On topic because eating: I hope the publicity doesn't go to their head.
I'll get right on the 57 page report in 154 now.
You'll never master the blockchain at that rate.
Hahahahaha. All those ICOs are so fucked.
the Commission has determined that DAO Tokens are securities under the Securities Act of 1933 ("Securities Act") and the Securities Exchange Act of 1934 ("Exchange Act").1 The Commission deems it appropriate and in the public interest to issue this report of investigation ("Report") pursuant to Section 21(a) of the Exchange Act to advise those who would use a Decentralized Autonomous Organization ("DAO Entity"), or other distributed ledger or blockchain-enabled means for capital raising, to take appropriate steps to ensure compliance with the U.S. federal securities laws. All securities offered and sold in the United States must be registered with the Commission or must qualify for an exemption from the registration requirements. In addition, any entity or person engaging in the activities of an exchange must register as a national securities exchange or operate pursuant to an exemption from such registration.
It's only a matter of time before the Trump SEC becomes pro-fraud. They'll be fine.