The Deeper Cost of Cryptocurrency Exchange Hacking

Incodium’s R&D Manager, Gilbert Talom, Reveals The Deeper Cost of Cryptocurrency Exchange Hacking

There have been a fair amount of hacking incidents on cryptocurrency exchanges this year. It is estimated that exchanges have lost close to USD 1.7 billion to hackers, inflicting severe damages on the cryptocurrency market as a whole. The media and social networking sites have rolled out thousands of articles, videos, and news pieces to explain the effect of hacking on the cryptocurrency market and the economy in general. There has however been very little attention on the common man, the student, the family head, the bus driver, the journalist, or the job applicant whose investment is lost in an exchange hacking incident. Come to think of it, these people are not only the raison d’être but also the real drivers of the cryptocurrency revolution.

With hundreds of ‘disruptive’ projects in an otherwise well established financial sector, blockchain and cryptocurrency projects seek to revolutionize service provision in what has come to be described as the ‘sharing’ economy. Transfer of funds, cloud services, rental businesses, real estate, maritime transportation, flight, gaming, and gambling are a few of the sectors that have been the focus of cryptocurrency projects. The ideas behind these projects, the unprecedented successes of pioneering projects like Bitcoin and Ripple, and more importantly, the ‘ease of entry’ into cryptocurrency trading has encouraged individuals of all works of life, social backgrounds, and ages to invest in cryptocurrency project.

While it is common knowledge that all investments have risks, investors can tolerate volatility in the prices or value of cryptocurrency. They are however unprepared when faced with the possibility (or reality) of losing all or a substantial part of their investment in an exchange hacking incident.

While the substantial part of the USD 1.7 Billion lost in exchange hacking belongs to large and institutional investors, there is no doubt that people with little means have lost their life savings and sometimes livelihoods in exchange hacking. Losses of this nature often have devastating consequences on personal and business relationships, educational standing, mean of sustenance and may lead to life-threatening situations. Friends and relatives have been brave enough to talk about losing their coins in exchange hacking and the effect that has had on their health, mental state and relationships.

Exchange hacking incidents can also trigger massive falls in the value of cryptocurrencies and associated losses. These losses are not limited to financial stability and means of sustenance as we mentioned above but also lead to the loss of life. A South Korean student was found dead earlier this year after losing a lot of money in the cryptocurrency market. Other losses to hacking incidents have been of a personal nature, especially through the use of cell phone lines. These incidents pose a serious threat to the cryptocurrency market.

It’s not all doom and gloom for victims of exchange hacking. The introduction of the Incodium Project is a welcomed addition to the cryptocurrency market. Incodium will safeguard investments and offer even more value on the crypto platform. Incodium provides compensation for investors who are victims of exchange hacking damages. Eligible investors (those holding Incodium coin or INCO in their smart wallets) are compensated using a number of criteria with amounts up to USD 10 000 in some cases. The project not only provides a ‘soft landing’ for investors but a platform to generate even more value for investors who choose to participate in data sharing, crowdfunding and the payment platforms.

Considering the potential and popularity of the cryptocurrency market, Incodium is certainly a worthy companion for both investors and exchanges. One can only hope that an effective, fast and transparent project like Incodium succeeds.

Trump declares 'Red' Day

It’s all going wrong, it’s getting ‘red’. US president Donald Trump, the leader of the ‘free world’, has announced the United States’ withdrawal from the Paris Accord today.

The following pictures were taken at an exhibition l attended in Tokyo, June 2009.

Is this the future of the world?

Present Day Earth

The Earth in 2039

 The Earth in 2048

 The Earth in 2078

The world future generations will inherit

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DID MULTILATERALISM EVER STAND A CHANCE?

There once was a dream to integrate the world’s population financially, and through transport and trade routes into one big community. A dream in which the most pressing problems were solved through diplomacy and concerted efforts, where the rich held on to the poor and pulled them out of poverty. Nations trading themselves out of extreme poverty and people moving around freely to fulfill their dreams and better themselves and their communities.

This was the dream of multilateralism. The dream that the World Trade Organization, the United Nations and its agencies, International agreements like Copenhagen, and the Millennium Development Goals sought to achieve. While that dream seemed achievable in the 2000s, very few will argue that it is stuff for the textbooks and seminars as the world stares as work that was done towards achieving multilateralism is being dismantled.

We did have a taste of multilateralism, and it got us excited about what the world could achieve, if we all worked together. Through a number of high-level conferences, the world leaders were able to come to an agreement on curbing emissions for environmental protection. This was followed by emission trading schemes and the World Economic Forum made it a point of involving the business communities in efforts to protect the environment.

 The World Trade Organization launched the Doha Round of Trade negotiations with the specific aim of boosting trade in developing countries and helping in their development process. The United Nations and its agencies launched the Millennium Development Goals (now replaced by the Sustainable Development Goals), engaging partners and resources at all levels around eight goals that were aimed at halving poverty by 2015. G20 summits were highly anticipated, and measures were taken towards improving trade, curbing protectionism and stabilizing fiscal and monetary policies around the world to strengthen development. A lot was achieved, and there was more to come, until things turned sour.

We can blame it on the financial crisis in 2008/2009, the wave of terrorism that increased vigilance around the world, the rising wave of nationalism and more recently the rise of populist leaders. The truth is, we cannot stop wondering if multilateralism was only ever a dream. Many wondered the effect an explosion of Regional Trading Agreements in the late 90s and 2000s will have on the Multilateral Trading System. It all seemed so positive, that only a few had the foresight to see that all it took was some hardships, stumbling blocks, and ‘a threat to our way of life’ for multilateralism to become the forgone alternative. Who would have imagined, that it would take an American president to put in doubt the outcome of a global push towards environmental protection, achieved by another American president by chasing a Chinese delegation in the hallways at Copenhagen. That the Chinese would today emerge as the leaders of the free world, advocating for free trade and movement of goods and services while the Americans resort to building ‘walls’.

The European Union is threatened by the exit of the United Kingdom from the EU, and there is uncertainty regarding the process of negotiation that will ensue in the following months and years. Temporary camps for refuges around Europe are likely to become permanent homes, as thousands meet their fate in oceans and high sees escaping persecution, hunger and violence. It is not hard to see why in a recent rally, German Chancellor Angela Merkel calls on fellow Europeans to take their fate into their hands, and depend on Europe.

As one would imagine, in the midst of all these uncertainties, aid and development initiatives in Africa and other poor regions of the world have been relegated to the background. There is a new socio-political map about to be drawn, and the changes that will accompany this new map are not necessary bright for those whose waist deep in poverty or whose livelihoods are threatened by environmental changes.

Yes, multilateralism is about to become one of those theories for International Relations textbooks and the subject of conferences, except it receives a jolt in the direction. It is hard to see where that jolt will come from, but one can only hope that a recovering world economy will bring with it a new push for global problem solving.

Groundhog Day, again 1

The growth trajectory of the Korean economy has been the envy of most developing countries around the world. The story of poverty to riches, of hunger to plentiful, of a country that has moved from being one of the biggest aid recipients to an aid donor and a member of the ‘prestigious’ OECD-DAC is one that many developing countries seek to emulate. The country is today at the forefront of technological advancement, environmental protection and healthcare services. However, the scandals that have engulfed Korea in recent months have exposed serious problems in the building blocks of the country; the curse of authoritarian development.

As a graduate student a few years ago, I had passionate and in-depth discussions with my colleagues and professors on which form of government was most appropriate for most developing countries as they strived to achieve economic growth and development. For most of us- most of who were from developing countries- we thought a ‘benevolent dictatorship’, or authoritarian development was the right path towards rapid economic growth. Why have a divided country and waste vast amount of resources on multi-party democratic reforms when the entire country needed to head in the same direction and dedicate all available resources towards achieving economic growth. Participation rates in most elections were very low, and in most countries long serving presidents were always almost certain to win. The democratic process seemed like a huge waste of national resources. It was hard to hear some of my Korean professors and friends criticize the regime of president Park JungHee, considering he oversaw the rapid economic growth of the country.

In hindsight, l now realize just how wrong l was. That president Park had a vision for this country, that he set the path for Korean economic growth and pushed forward to achieve that objective against adversity from home and abroad remains a profound achievement. This country owes him gratitude, as do l and many others who have benefited from the hard work and kindness of the Korean government and people. However, the policies adopted during his presidency and those of subsequent leaders have had a rather negative long-term effect on the country. The political and institutional development was stifled along with dissent, and that has had serious repercussions on the progress of the country.

Consider the following extract from a write up:

“…It does not require much effort to speculate how it had been possible to raise black money of such a astronomical figure. The vast majority of the amount, as it has been revealed, came from businessmen as extortion payments to get around heavy government regulations or to receive contracts for government projects.”

“… Assembly is for the most part failing in its duty to pass legislation whose priority is to contribute to the public interest and to rigorously exercise its power of legislative review to prevent the deviant behavior of the executive branch.”

“…The role of the judiciary is to restrain the deviation of these government branches. However, a huge chasm separates the current state of the judiciary and the public’s expectation”

If you’re thinking this is a recent publication on the state of events for the past month in Korea, you’re wrong. This is an extract from a paper by Professor IIjoong Kim  in November of 1995 on the scandal that rocked South Korea after the discovery of the $650 million slush-fund by former president Roh Tae-woo. Twenty-one years later, Korea is faced with another scandal of the same nature, except this time the reputation of the nation that performed ‘the miracle on the Han’ is at risk. We pose the question: why have the regulations enacted in the aftermath of that scandal, subsequent scandals, and administrations been so ineffective? The situation brings to mind the 1993 hollywood movie “GroundHog Day” starring Bill Murray. It’s like waking up to the same day all the time. In part two, we discuss just how it all went wrong.

NEW FRONTIERS; Korea’s Trade with Africa

NEW FRONTIERS; Korea’s Trade with Africa

Like many other countries in East Asia, South Korea has developed rapidly in the past four decades through an export oriented growth strategy. Korea’s development and investment in education has put the country at the forefront of technological development. To sustain growth, most Korean companies have outsourced parts or their entire production processes to many countries in Asia and South America. With an ever increasing wage bill in Asia as many countries continue to grow, and the recent election of Donald Trump to the US presidency (one of his campaign promises was to scrap the NAFTA and renegotiate all trade deals signed by the US including the US-KOREA FTA), it is time for South Korea to pivot towards Africa.

Africa offers some exciting opportunities for trade and cooperation with South Korea. A lower wage bill and a youthful population provide an attractive option for Korean companies as they look to maintain their competitive edge in the global market. It is imperative that companies keep their costs of production low, as they face stiff competition around the world. Costs of living and other expenses have increased calls for higher wages across many Asian countries. It is time for Korea to look towards Africa for cheaper labor to maintain its competitive edge.

Another important point is the growing demand for ‘sustainable’ technology in Africa. African countries continue to grow, and contrary to early developers who had little regard for the environment, the emphasis is on sustainable development now. Korea is in a unique position to provide the technology required for sustainable development. Korea’s Green Growth drive has seen a huge investment in green technology in the past decade, which can be readily made available to growing economies in Africa. Recycling technology is one such area in which Korea leads for the world to follow.

To sustain economic growth, Korea also needs a constant supply of raw materials. There is an abundance of raw materials in most African countries, and pivoting to increase trade with Africa will give Korea access to raw materials needed by most of their companies. There is no doubt that a growing middle class and an expanding private sector in many African countries will provide a market for Korean products.

China, the US, and Europe have had a longer history of dealing with many African countries. However, Korea’s history and rapid development presents an example that many new governments in Africa would love to follow. Most new governments will be looking to break the hooks of neo-colonialism that Europe has had on Africa through their multinationals. Korean companies will provide a fresh start for most governments, and a trustworthy partner in the development process.

Increasing trade with Africa will be mutually beneficial to Korea and many African countries.

Is deepening trade between Africa and South Korea in the interest of the parties concerned? 

Have your say.

The End of the ‘Yes We Can’ Era

Very few people would have forgotten the jubilation and fanfare that accompanied the election of Barack Obama to the presidency of the United States in 2008. There were celebrations around the world from Europe to Asia, Africa to the Americas as we all looked to the silver lining in a year that had seen the world hit hard by the financial crisis that began in the US. There was a glimmer of hope to all the ‘Davids’ around the world. If the US had finally had its first black president, the message to every child in every corner of the globe was that the world was ours for the taking; if we worked hard at it. At least that is what it meant to me.

Fast-forward eight years and it’s 2016 when Obama is saying goodbye to the White House. The question on most minds is ‘Did he live up to our expectations?’ I doubt he did, no human could have. The world was in such a terrible state when he took office that we expected him to do almost the impossible; fix what was broken with the US economy- that was waist deep in financial crisis, divided, and in no hurry to attend to pressing problems of health care and environmental protection. Above all, the ‘fix’ had to be for the US, but it also had to trickle down to the rest of the world because we have always looked to America for leadership. It did the president no good that he was black, as a number of politicians vowed upon his inauguration to ‘do everything possible’ to limit him to one term in office.

Fareed Zakaria presented a very insightful assessment of president Obama’s legacy in his December 5^th episode of GPS. He argues that Obama brought a dramatic change to US policy, and may go down as one of the most consequential in US history. Obama may have failed in closing Guantanamo Bay detention center, overseen the rise of the so called ‘Islamic state’, the collapse of Libya, Syria and domestic issues like the rise of health care premium, but the fact remains that he did achieve a lot during the two terms of his presidency. The US economy has since stopped bleeding jobs, and the world has taken its cue from there. The environment, healthcare, gay rights and a more diplomatic approach to resolving world issues are among some of the things Obama will be remembered for.

We are holding our breaths, waiting to see what will happen as now president elect Trump vows to undo the legacy of President Obama. The uncertainty is not only at home in the US, as he has also called to question the role the US played in the Paris Climate change Agreement, NATO, the Iran Nuclear deal and Regional Trading Agreements the USA has signed with other countries.

What are your thoughts on the Obama presidency, and the future of the world?