Human Husbandry

Domesticated chickens that escape to the wild rarely survive more than a generation. After thousands of years, hens have all but lost the instinct to hatch their eggs.

See, broodiness is an undesirable trait on egg farms. Battery hens average six eggs a week, and the last thing Foster Farms needs is a bird that takes time off to set on eggs. Breeders select for the absence of broody behavior, and propagate chickens with the least desire to reproduce.

Over the course of civilization, humans have undergone a similar self-domestication process. Rather than promote traits that lead to reproductive success, we propagate traits best suited for the current social environment. As with livestock, the most attractive traits are those that maximize productivity.

Domestication is a rather unnatural form of selection. As a population’s per-capita GDP increases, average fertility decreases. This phenomenon has been termed the demographic-economic paradox, but it’s really not paradoxical at all. Raising children carries a huge opportunity cost – remove this cost and the population has way more productive capacity. It’s no coincidence that San Francisco, home of the most advanced civilization in the world, also has the lowest share of children out of any major city in the country.

Just as a broody hen negatively impacts a farmer’s productivity, a gravid human poses a significant inconvenience to her employer. That’s why companies like Google, Facebook, and Apple pay for female employees to extract and freeze their eggs. It’s great to see tech companies empowering women the same way that factory farms empower their battery hens!

BUT! While farmers can breed chicken offspring in artificial incubators, it’s trickier for a human population to regenerate without assistance from our keepers. Most tech companies allow dogs at work — Google even provides on-site doggie caretakers! – they could go a long way towards securing the next generation of workers by simply expanding their dog runs to accommodate children. In Silicon Valley, it’s easy to hire illegal immigrants undocumented citizens to caretake kids on the cheap. Just ask Arianna Huffington and Meg Whitman!

We can outsource the burden of raising one’s spawn, but we’re still faced with the problem of making them*. This is where technology gets really exciting: Artificial wombs have successfully brought a baby lamb to term; eventually, these Biobags will be available to humans as well. Just like chickens, people will be able to procreate without ever interacting with their offspring.

Human progress revolves around specialization and the division of labor. We don’t raise our own livestock or butcher our own meat; it’s absolutely preposterous that we still bear and raise our own young. Come to Silicon Valley, where you, too, can live in a battery cage while surrounded by free food! Isn’t civilization great?

* Marc Andreessen and his wife hired a surrogate to carry their biological child. While not scalable, it’s always heartwarming to see billionaires take time out of their busy lives to reproduce like the rest of us mere mortals. Even if it does involve some outsourcing.

A Side Effect of the Cryptocurrency Ad Ban

This site gets hacked. A lot. Don’t worry, it’s not the kind of hack where your browser is hijacked to mine Monero or spread malware. It’s more innocuous; the kind of hack where someone sneaks into the content database and fills it with spam links.

I run a weekly script to clean out spam, but if you catch a post at an inopportune time, you might find an unsubtle plug for some sketchy third-party site. For example, this post recently contained a link to prescription-free anabolic steroids. That wasn’t me, I swear.

The link injections typically occur in batches, and feature some assortment of penis pills, porn sites, and other internet dreck. The bane of my web existence. I’m pretty sure I know how they’re getting in; the part I can’t figure out is why.

WHY are sketchy internet services hiring spammers to inject links into my low-rent web blog? How much visibility do they expect to get? Did Noonan Brown personal injury attorney really think that this would be a good way to reach new clients?

Over the weekend, I was scrubbing a recent batch of site spam when I noticed, in between the loan sharks and debt-forgiveness services, recurring links to Abra.com.

Wait a minute — I used to work at Abra! Abra is a good company run by good people, certainly not ones who would engage the services of sketchy link spammers. And really, if Abra wanted a shameless plug on my website, I’d give it to them for free.

So I messaged a former coworker to find out what was up. They had been exploring new advertisers, he said. Now that Google and Facebook have instated a blanket ban on crypto ads, Bitcoin businesses are left with limited options to reach their customers.

For those banned from ad networks, search engine optimization is perhaps the last bastion of low-cost digital promotion. Even if you can’t pay Google to display your ads, you can still push your way to the top of search results through SEO.

And while Google’s search rank algorithm is an industry secret, it is based in part on the number of websites that link back to your page – also known as backlinks. Google was originally called Backrub because its search results were ranked according to backlinks.

The original Google

Backlinks are commonly accrued by getting news, blog, and social media mentions, but that can be a lot of work. Fortunately, there are handy backlink services for hire — These are the guys who crawl through forums and comment sections and leave link droppings all over the place. Some will pay bloggers for mentions, others will inject their way in. In any case, backlink outreach is a huge industry.

An example of successful link injection.

I was happy to see Google and Facebook ban crypto ads; there was some really vile stuff going on over there. But censorship doesn’t differentiate between fraud and not-fraud; everyone’s treated like a criminal just the same. And banning something doesn’t ever make it disappear; it just pushes the activity into scuzzier corners of the internet.

We can’t expect the ad networks to exert editorial oversight, because that would ruin their massively scalable business model. So we’re left with this suboptimal state of affairs where upstanding companies are forced act like spammers, and it’s that much harder for people to discern scams from legitimate services.

Google banned crypto ads, but is still okay with backlink ads.

Belling the Cat

Spring is here! The days are warm, the birdfeeders are out, and I’m enjoying the company of songbirds who build their seasonal homes beneath my awning.

Except that the neighbor’s cat keeps coming here and killing them.

I. HATE. THAT. CAT.

I got one of those live animal traps, the kind you use for coons and foxes. My plan is to trap the cat and tie a cowbell around its neck. Maybe step on its tail a few times.

Two weeks later, the trap is still empty. Seriously, eff that cat.

There’s an episode of Tom and Jerry where a pair of mice are trying to bell a cat. Jerry the Mouse attempts to tie a bell on the cat’s neck while the cat is asleep; the cat wakes up and mauls him. Baby Mouse takes a different tack: He wraps a bell in a gift box with a bow, presents it to the cat, and the cat is so delighted by the gift that he puts the bell on himself, never realizing its underlying purpose.

Isn’t that what Google and Facebook and friends are doing? If the government demanded unfettered access to our private lives, there would be massive outrage. Instead, the tech behemoths present us with Free Email, Free Photo Albums, Free Cloud Storage, and we tie the bells around our own necks. We never intended to carry always-on location-tracking devices, but who can resist a Free Map service?

Don’t look a gift horse in the mouth — and that’s exactly how you end up with the Greek army inside your city walls.

Batching Mental Transaction Costs

There’s a popular American pastime that involves flinging dollar bills at scantily clad dancers. Canada, Europe, and the UK lack small-denomination banknotes, so strip club patrons have limited ability to express appreciation for their performers. Customers can either pelt the dancers with coins, which is rude; or shower them with large bills, which is extravagant. The transaction costs are unnecessarily high, and onstage tipping is rare.

In Australia, the smallest banknote is a five. While living in Sydney, I discovered (not from personal experience, really) that gentlemen’s clubs sell fake banknotes for guests to use as tips. The dancers exchange the fake dollars for real money at the end of the night.

Fake dollars for sale at a gentlemen’s club in Sydney. Why did they model their money after USD instead of Aussie banknotes? Also, I bet the US $2 bill would have much wider adoption if the note featured a pole dancer instead of Thomas Jefferson. He already has the nickel! How bout some diversity, come on.

How terribly exploitative! Instead of peer-to-peer payments, the house intermediates every transaction with self-issued fiat. It probably even takes a cut.

But… maybe it’s not so bad. I endured many a childhood birthday party at Chuck E. Cheese, where parents would hand each kid a stack of tokens and set them loose. Tokens could be used to pay for rides and games and candy, and were functionally equivalent to a quarter.

We already have quarters. Why did Chuck E. Cheese go through the hassle of minting its own coinage when it could have simply installed a laundromat change machine?

Chuck E. Cheese tokens come in a jumbo plastic cup, just like a real casino.

Chuck E. Cheese and Aussie strip clubs employ the same brilliant strategy of batching mental transactions. Every monetary exchange incurs a cognitive cost, if from nothing more than the conscious decision to spend money. The overhead is nominal for most standard transactions, but relatively massive compared to a micropayment.

By forcing customers to make a large upfront commitment, these establishments avoid imposing a cognitive load on every subsequent exchange.

Casinos employ the same strategy with poker chips and slot tokens: Gamblers wager more freely with play money they’ve already bought. Sure they can cash out, but that’s an additional transaction cost.

People have been failing to effectuate micropayments since the early days of the internet. A machine-payable web, where you pay for the content you consume, or pay-per-byte internet protocols – these sound like great ways to finely optimize the allocation of resources. But no matter what fancy new technology is employed – Digicash! Millicent! FirstVirtual! CyberCash! Blockchain! – micropayments never cease to be a bad idea.

And now the Bitcoin Lightning Network. With instant transactions and exceptionally low fees, this time is different.

Maybe. A user funds a Lightning channel with the intention of fully spending its contents (it is a hot wallet after all, and costs money to cash out). In these early days, each channel has limited utility. If a channel commitment represents a one-way payment for a certain set of services, then it functions more like a subscription fee than a series of microtransactions. Like buying a stack of tokens at Chuck E. Cheese.

This model isnt great for Lightning-as-a-liquidity-provider, but it does bode well for Lightning-as-enabler-of-micropayments. Who knows.

Virtual tipping. A great application for Lightning.

See Also:
The Transaction Costs of Tokenizing Everything

Bitcoin as a Display of Wealth

I just spent three weeks in bed with the flu from hell, which means I not only missed Bitcoin’s untimely death, but also its subsequent resurrection. Did everyone remember to buy the dip?

Had I been alert and conscious, I might have worried for a bit. Paul Krugman doesn’t know anything about anything, but I’ll grant him this one: There’s nothing to backstop a cryptocurrency’s value! If people come to believe that Bitcoin is worthless, it’s worthless. There’s no tether to reality 😮. If only Bitcoin could be used to make pretty jewelry!

One of the greatest tragedies of modern money is the decoupling between a store and display of wealth. Or, more accurately, the societal decoupling between wealth and status. For most of human history, the functions of display and storage were condensed. Even before people wore clothing, they wore piercings and tattoos. A full-body ink job isn’t transferable, but it’s a sort of proof of work.

Tribal tattoos on a mummified Scythian chieftain, 500 BC.

As societies increased in wealth, both people and objects became specialized in their functions. Stores of value were selected for their resistance to corrosion and theft. Displays of status optimize for just the opposite. The more unwieldy and vulnerable the display, the greater the power it conveys.

There’s no reliable way to physically project a bank account balance, so we use costly signals as a proxy. Designer shoes indicate disposable income. A diamond ring reveals your spouse’s bimonthly salary. An American Express Centurion card communicates the ability to spend half a million dollars a year.

Abundance signaling is wasteful, and often relies on a trusted third party to maintain the integrity of the signal. Bitcoin is regarded as a decentralized store of value, but still underappreciated as a way to disintermediate our displays of wealth.

Crypto-Bling

Cryptokitties, ugh. Why would anyone waste a perfectly good blockchain on a centrally controlled collectible? The only way to generate a cat image is to rely on the Cryptokitties website. And the only way to prove ownership of that image is to reveal your account address. There’s a better way to flaunt crypto wealth.

Secure multi-party computations were first introduced in 1982 as a solution to the Millionaires’ Problem: Multiple millionaires want to know their relative wealth standing, but no one wants to reveal their actual net worth.

One solution is to distribute shares of a secret to each participant. Each person combines the secret with the value of their net worth, broadcasts the result, and a blinded function processes the values to arrive at the final rankings. This function evaluation forms the basis for a zero-knowledge proof.

This can be done with any cryptocurrency. Instead of self-reporting a net worth, each participant signs a message to prove ownership of an account. The message is combined with a secret share, resulting in an output that indicates the user’s balance relative to everyone else. Turn the output into crypto-bling by mapping it to a unique identicon. Bitcoin can now be used as a visual display of wealth.

The identicons can even be made unforgeable. If each viewer distributes a different secret, then the set of identicons will look different to every observer while still communicating the same information about relative status. A display of wealth, then, is in the eye of the beholder.

WordPress identicons

But an identicon isn’t pretty…

Paul Krugman is wrong about the pretty jewelry, cuz that’s not what gold is about. Objectively speaking, silver is the most light-reflective element that exists. If you wanted to bedeck yourself in bling bling, you’d get the most bang for your buck with silver. But pound for pound, gold is more valuable because it’s harder to obtain.

Gold isn’t valuable because it’s used for jewelry, jewelry is valuable because it’s made of gold. –Nick Szabo

A display of wealth isn’t about being pretty, it’s about having stuff that others don’t. Roman emperors knew that wealth displays were a wasteful arms race, so they created sumptuary laws to prohibit conspicuous consumption.

Bitcoin bling removes the costly signaling by re-condensing the functions of a store and display of value, and does so without the need for a trusted third party. Someday, crypto-bling will be the prettiest bling around.