humanist + humorist

Look, objectively, it’s a good change that crypto scams are no longer the hot mainstream thing, and the era of “big splashy trials” has transitioned into an era of “convicted scammers serving time.” It’s a net positive for the world that the newsletters of Molly White, David Gerard, and Amy Castor are more about slow-and-steady legal proceedings than explosive new frauds.

But it seems like all that energy has transitioned into AI garbage, and those stories are just not hitting the interest buttons in my brain the same way. Even the funny ones are so much more tiring. (And the least-funny ones are full-on war crimes.)

The other day, I thought I had found a new dunking-on-crypto podcast with a backlog of long-form deep-dives to listen to! Then one episode turned into this performative rage-screed about some other critics. (“Why aren’t they having me on their podcast? Also, why are these cowardly f@#kfaces claiming I attacked them??”) I lasted through a whole 20 minutes before clicking unsubscribe and backing away slowly.

…anyway, here’s a bunch of news about AI garbage. (Not the war-crimes kind.)

Adventures in bot hallucination

“Generative AI is famous for “hallucinating” made-up answers with wrong facts. These are crippling to the credibility of AI-driven products. The bad news is that the hallucinations are not decreasing. In fact, the hallucinations are getting worse.“

“The Catholic advocacy group Catholic Answers released an AI priest called “Father Justin” earlier this week — but quickly defrocked the chatbot after it repeatedly claimed it was a real member of the clergy. […] The AI priest also told one user that it was okay to baptize a baby in Gatorade.”

“It’s clear that companies are currently unable to make chatbots like ChatGPT comply with EU law, when processing data about individuals. If a system cannot produce accurate and transparent results, it cannot be used to generate data about individuals. The technology has to follow the legal requirements, not the other way around.” (This one makes the puzzling assertion that the hallucinations are fine for things like “homework.” Are they, though?)

“Meta AI agents started venturing into social media this week to engage with real people, their bizarre exchanges exposed the ongoing limitations of even the best generative AI technology. One joined a Facebook moms’ group to talk about its gifted child. Another tried to give away nonexistent items to confused members of a Buy Nothing forum.”

Throwback to 2023: “Yes, there is something unusual about the giraffe’s coat. Specifically, the giraffe appears to be wearing a coat. While this might seem unusual or unexpected, it is a common practice in the case of giraffes raised in captivity.” (Spoiler alert: the giraffe is not wearing a coat.)

Garbage and spam

As a search-engine user trying to find useful information, I feel this in my soul: “It’s been over a year since I last told you to just buy a Brother laser printer, and that article has fallen down the list of Google search results because I haven’t spent my time loading it up with fake updates every so often to gain the attention of the Google search robot.”

“What’s clear right now is that there’s no one spamming Google [that’s] not doing it with AI,” Gillham told The Register. “Not all AI content is spam, but I think right now all spam is AI content.“

Mechanical Turk 2K24

For anyone who doesn’t know the reference: the “Mechanical Turk” was an “automaton chess-playing machine” that was, in fact, just operated by a human hidden in the box and pulling levers. It was built in 1770. AI fraudsters are only the latest in a centuries-long tradition.

Like this: “Just over half of Amazon Fresh stores are equipped with Just Walk Out. The technology allows customers to skip checkout altogether by scanning a QR code when they enter the store. Though it seemed completely automated, Just Walk Out relied on more than 1,000 people in India watching and labeling videos to ensure accurate checkouts. The cashiers were simply moved off-site, and they watched you as you shopped.“

More of a throwback: “In this video we take a look back at Project Milo, a game […] that claimed to utilize groundbreaking AI technology.” All the language, all the claims, it’s pitch-perfect the kind of stuff OpenAI is trying to convince us about in 2024! This whole scheme is from 2009.

 

Hey look, the backstory for the “Kickstarter is going to start doing…something…on the Celo blockchain” announcement has finally been dug up: They got $100 million from Andreessen Horowitz to say they were moving to Celo.

Guess what blockchain that firm also invests in!

Did you guess Celo?

Wow, it’s almost like crypto has a pattern of pump-and-dumps that all work the same way.

And it gets better: “The deal didn’t require Kickstarter to follow through on the pivot.” They never needed to have a blockchain plan, much less accomplish the blockchain plan. They just needed to say they were doing a blockchain plan.

(please enjoy this bot’s idea of what “Man with a bag of money sliding down a blockchain” would look like)

A caveat: I appreciate all the hard financial details in that article I linked, but the POV of the authors includes some weird biases. For instance, they still swallow the idea that a blockchain, “with its traceable addresses and transaction history, could help solve the platform’s difficulties with fraud and trust”,

Kickstarter doesn’t transfer funds to random, anonymous, untraceable people. If you want to launch a project, they get your legal ID and your bank details. Those are extremely traceable!

And all the transactions on KS are accurately recorded already. Pledges are not getting secretly edited behind your back. That’s not where the fraud comes in!

“Putting the transaction records on a different type of database” does nothing to stop a project creator from pretending they plan to make a comic/movie/widget/etc, and then turning around and using the funds to buy themselves a house.

Or from having sincere, genuine ambitions to make the comic/movie/widget/etc they promised, but in practice, they’ve bitten off more than they can chew.

Or from sincerely working on the project, only to get tempted to use a bit of the money for some other bill…the dog got sick, they needed a new part for the car, a pipe burst in the bathroom, they were a tiny bit short on the rent this month…and they blow through all the pledges before they get around to paying the project bills.

Or, to use one of the actual fraudsters mentioned in this article, “raising money for turtle conservation charities only to turn around and blow it on crypto.”

The crypto fraudster, by the way, was investigated, taken to court, and sanctioned: “Under a settlement, Darling has agreed to provide restitution to supporters, to pay civil penalties and to not engage in additional crowdfunding campaigns in Ohio for at least five years.”

I’m sure the investigation process was long and complicated…but I can guarantee you that “tracing the guy’s legal ID, and having accurate records of who he owed refunds to” was not the hard part.

The tech-hype train has fallen so hard for Large Language Models, it took longer than usual to build up this many crypto links…but they’re still coming.

Lots of lengthier and more-substantial pieces in this batch, too:

March 26: Dan Olsen does a video deep-dive into Decentraland, best summarized as “the developers insist this is the future because blockchain, but all they actually did is reinvent Second Life, except buggier.”

April 19: A follower of an NFT game writes a lengthy reflection on how and why it imploded. The writer actually liked the game, so it’s not just dunking on the concept, it’s a thoughtful dissection of “here’s what the fan community got out of it, and here’s exactly how it went down.”

What really gets me about this one is, the author is really enthusiastic about the “new physics” of digital trading cards using smart contracts. How it “aligns the interests of the game maker with the player”, so there’s no incentive for the game to exploit players with the “unethical” and “addictive gaming mechanic” of selling mystery-content booster packs.

Scroll down a few sections…the game is in financial trouble, the developers need to raise some cash, they do it by holding a special event…where they sell mystery-content NFT booster packs!

It’s just such a stark demonstration of “guess what, you aren’t going to change basic patterns of economic incentives or human nature by putting your game code on a different type of database.”

April 25: Livestreamed Q&A with Bennett Tomlin (Crypto Critics’ Corner), with some fascinating tidbits about his early days as a crypto true-believer. Favorite twist: he applied to one company by writing a paper that did an in-depth consideration of all the potential problems with their token, and they responded that it showed he was “not yet mature enough to be an analyst at this cryptocurrency hedge fund.” (As we all know, if you see any drawbacks in crypto, it’s just because you don’t understand yet!)

May 7: “A recent surge in memecoin popularity has caused Ethereum transaction fees to skyrocket. One trader paid the price, eating a 64 ETH ($118,000) transaction fee just to perform a simple swap of 84 ETH.”

Me, on July 9: “shoutout to #CalvinAndHobbes for having the most spot-on prediction of NFTs”

August 17: “The problem was pervasive enough that it could account for a serious amount of Tether transactions. I’d heard that Chinatown [a compound in southwest Cambodia] alone held as many as 6,000 captive workers like “Vicky Ho.” […] Crypto bros like to claim they were somehow helping the poor. But it seemed none of them had bothered to look into the darker consequences of a technology that allowed for anonymous, untraceable payments.“

(The last one is an excerpt from an upcoming book. Definitely putting it on my to-read list.)

There’s been a deluge of crypto-rubbernecking articles since FTX melted down 4 months ago…and I’m not even gonna try to link all the good reads. These are just some of the top hits.

November: "In less than a month, reporting and the bankruptcy process have uncovered a laundry list of further decisions and practices that would constitute financial fraud if FTX had been a U.S. regulated entity – even without any crypto-specific rules at play. [...] The list is very, very long."

December: "Sam Bankman-Fried’s $30 million Bahamas penthouse looks like a dorm after the students have left for winter break. The dishwasher is full. Towels are piled in the laundry room. Bat streamers from a Halloween party are still hanging from a doorway. Two boxes of Legos sit on the floor of one bedroom."

"The Block, a media company that says it covers crypto news independently, has been secretly funded for over a year with money funneled to The Block's CEO from the disgraced Sam Bankman-Fried's cryptocurrency trading firm, sources told Axios. "

"Zhao [CZ, from Binance] was concerned that Bankman-Fried was orchestrating crypto trades that could send the industry into a meltdown. "Stop now, don't cause more damage," Zhao wrote in a group chat with Bankman-Fried and other crypto executives Nov. 10. "The more damage you do now, the more jail time." "

"[Trump's] “digital trading cards” are indeed just another cash grab NFT project, but the low quality images and the company in charge of the project are a more complicated enigma. The images were so lazy that based on reverse image searches they were edited photos scraped off the internet." Zoom in on some of them, and you can even see the remains of the Shutterstock watermarks...

February: "These are sophisticated idiots that not only acted with disregard for their customers’ funds - not that one can call anyone of Celsius a “customer” in the traditional sense, as no service was being offered - but with possibly the least financial acumen I’ve seen outside of the Minions from the Despicable Me movies."

"Dillon Danis said he felt bad for the victims of scams, but let's see if he really means that. Putting an influencer to the ultimate test, by offering them money to promote what is an OBVIOUS fake NFT website, and then giving them a contract acknowledging the whole scheme." [Video, another slam dunk from Coffeezilla]

Now: Crypto Collapse BINGO, 2022-23 edition, updated with the folding of Silvergate Bank. (I haven't watched Crypto Critics' Corner's video about the de-bankening yet, but I'm sure it's a good time.)

Twitter and other social networks:

twitter_refugees is a DW comm for Twitter natives encountering journal sites for the first time. I've been on journal sites way too long to know if this is helpful. Maybe someone else can give it a review?

"I posted a thread on Twitter about potential legal liabilities for United States people who decide to run a Mastodon instance, and the response made it clear there's a lot of people who could use the extended background. So here is a guide to potential liability pitfalls for people who are running a Mastodon instance, and how to mitigate them." Not for everyone making a Mastodon account, but if you're hosting other people's accounts, read it.

"Mark Zuckerberg (founder and CEO, Facebook): I was in my sophomore year at Harvard. It was 2003, which is the year that historians call The Dunce’s Millennium because the world was dark chaos. Everyone was running around with all of their secrets locked up in their brains. Nobody knew anybody’s favorite movies. Nobody knew what anybody else looked like in a bathing suit. I wanted to change that." Clickhole's definitive oral history of Facebook.

"Tesla Fire tracks all Tesla fires - including cars and other products, e.g. Tesla MegaPacks - that are reported by news articles or verified primary sources. We also tally the number of fatalities involved with Tesla fires and provide links to additional photos or footage wherever possible." (Total, as of this posting: 143 confirmed cases, 44 fatalities.)


AI things that are fun, actually:

A neural net AI, "when faced with predicting what would come next on this [New Year's Resolution] list, predicted first one drawing-related resolution, and then multiple others. Soon this became not just a list of resolutions, but specifically a list of drawing-related resolutions. It generated a broccoli-and-drawing-related resolution, and then the list became a list of resolutions by a painter/broccoli fanatic. "

Another one was set to the task of predicting color names: "Some of our other color scales have four coordinates (like the ones designed for print), but the common ones don't go up to 255. I like to think that Starbat is a color meant for birds to see, and the 1st color is actually meant for their ultraviolet vision."

"For nearly a decade, I’ve run @forexposure_txt, a twitter account that anonymously posts real quotes from people trying to convince artists to work for free. The humorous rationalizations it uncovers sometimes read like found poems. So I took 120 of my favorite quotes, and used Midjourney’s AI art creation tool to turn them into comics."


Crypto and other scams:

"A part of the popular narrative around NFTs was that royalties were built into the operation of the blockchain. This was never true." And now that the profits are slipping, NFT marketplaces are starting to ditch their obligations.

The writer of that one uses the tone all credible crypto-reporting should take these days: "If you are reading this and can still hold your mobile device even as you roll on the floor in a fit of “I told you so” laughter..."

Speaking of yelling about crypto, here's a video clip of a guy on Bloomberg News, yelling about how FTX was never regulated. The "...you idiots" is unstated, but surprisingly audible.

Back in traditional finance: "Etsy is now forcing shop owners to be part of their ads. We can not opt out. [...] Be aware that half the results WITHIN ETSY are ads as well, and if you click on one of those during browsing, even if you do not buy from that link, you have set a cookie within Etsy that tells them you’re shopping off an ad, and so they will charge the fee to whoever you buy from regardless if it was related to the ad you clicked. Please clear your cookies before you make an Etsy purchase. Yes really truly."

Welp, we’re having another banner week in the crypto world, huh?

These are links I’ve been picking up over the past month or two. They go up to the Luna “we have a token that will always be worth US$1 because of Algorithms(TM), what could go wrong?” crash, but nothing yet from the Celsius “we are not a bank, because banks are Bad and we are Good, so we don’t need all those silly regulations that banks have to follow, and oops now we’re freezing everyone’s ability to withdraw your tokens” crash.

The first Patreon Creator Census has a lot of broad strokes you probably could’ve guessed, but it’s nice to see the specifics broken down. Especially when they break stuff out by “what field is the creator in?”

Creators overwhelmingly hate crypto, btw. Patreon tries to downplay it by breaking out the fields that hate it least…but that also reveals that visual artists hate it the most. You know, the field where crypto has made the biggest and hardest pitch for how useful it is? Second-most hate comes from the writers (the fields where the journalists are), and third-most comes from the game developers (the field where crypto has made the second-biggest push).

“As talk of “the metaverse” grows, and people float [NFT] theories about owning items and cosmetic skins and being able to take between games, interest in what that means practically for gamers has lead to a wild array of theories, but they’re largely pushed by people who know nothing about game development. So, as a developer, it falls to people like me who live and work in these spaces to share our knowledge.” (Link is just one article, but the whole blog is worth a read.)

“[US] Political donations from the sector surged to more than $26 million during 2021 and the first three months of this year. That influx of cash is outpacing spending by internet giants, drug makers and the defense industry — providing a fresh pool of financing for candidates heading into November’s congressional elections.”

“Ms. Blackburn consolidated many Bitcoin addresses, which might have seemed to represent many miners, into few. She pieced together a catalog of agents and concluded that, in those first two years, 64 key players — some of whom were the community’s “founders,” as the researchers called them — mined most of the Bitcoin that existed at the time.”

“All [interviewees] had similar testimonials about putting their faith in an asset they thought was stable and losing everything. Muhammad, a 30-year-old from Egypt, said that he learned about Luna from YouTubers who said that it would reach $1,000. He bought 1,000 tokens at $88. One token is now currently worth less than $0.0002.”

“[The article] uncritically repeated many questionable or entirely fallacious arguments from cryptocurrency advocates, and it appears that no experts on the topic were consulted, or even anyone with a less-than-rosy view on crypto. This is grossly irresponsible. Here, a group of around fifteen cryptocurrency researchers and critics have done what the New York Times apparently won’t.”

Title grabbed from The Onion’s lists of biggest crypto heists of all time.

As of this writing, Coinopsy has records of 2,403 “dead” cryptocurrencies, compared to a whopping 414 that are still kicking.

“In May, the Federal Trade Commission reported that consumers had lost more than $80 million on crypto scams between October 2020 and March 2021 — more than ten times the amount lost during the same period the previous year, $2 million of which was lost to scammers impersonating Elon Musk.”

Gaming company co-founder on why companies like Steam have stopped trying to work with crypto: “the vast majority of those transactions, for whatever reason, were fraudulent, where people were repudiating transactions or using illegal sources of funds and things like that. And that’s just out of control, right? You want that number, realistically, in a couple of percent, not half of all transactions turning out to be fraudulent transactions. Similarly, with the actors that are currently in this NFT space, they’re just not people you really are wanting to be doing business with. ”

Some crypto miners and traders “are attempting to take advantage of a controversial tax incentive in Republicans’ 2017 major tax legislation — specifically, by investing in “opportunity zones,” which were sold as a plan to buoy the poorest American neighborhoods but have evolved into a way for wealthy investors to funnel billions in untaxed profits into virtually any venture they choose.”

“As of Feb. 8 roughly 55% of Bitcoin investors were underwater, according to cryptocurrency investment firm 21Shares. That’s actually an improvement from several weeks ago, when Bitcoin was trading about $35,000. At that time, more than two out of every three Bitcoin investors were in the red.”

Crypto Critics’ Corner constantly has conversations about crypto so smart and technical and well-informed, I can barely keep up, and it’s an absolute pleasure to listen to. Recently a guest went “the value of Bitcoin is usually given in US$, but we should give it in Tether” and I was all…listen, I could not possibly have connected those dots myself, but know juuuust enough to grasp why it’s a Big Deal. I’m hanging on by my fingertips and it’s great.

"Jeff [Bezos] is so wealthy, that it is quite literally unimaginable. Let's put this wealth in perspective by comparing it to some familiar things."

New Yorker: "The actual truth about the American tax system is that it is slightly progressive. The richest one percent earn about 21 percent of the income and pay 24 percent of the taxes." (Honestly, better than I expected! But they could absolutely pay more.)

"This trend has been characterized as the Great Resignation, and just about every economist and pundit has taken their crack at teasing out why it’s happening. [...] In these moments, it’s best to actually ask the workers themselves. I did that, talking to dozens of people who have recently quit their job, or experts who closely track workers who have. And some patterns emerged."

"Those top players represent a mere 0.01% of all bitcoin holders and yet they control 27% of the digital currency, the Wall Street Journal reported. That compares to the old-fashion dollar, where the top 1% controlled 30% of total U.S. household wealth, according to Federal Reserve data." But hey, cryptocurrency is gonna be the great decentralized revolution that lets us escape the inequalities of fiat currency, right?

"DC/EP [China's test run of a digital-only currency, in beta] would have to be able to handle at least 300,000 transactions per second across the country at peak times to do what cash does. So DC/EP won’t be a blockchain." (For comparison, a single credit card like Visa averages a couple thousand per second and says they can handle at least 24,000, and Bitcoin averages a whopping between-3-and-4 transactions a second.)

"He told the press how the problems of banking the unbanked were technical — that banks were unable to move money fast enough without a blockchain. This is completely backwards. Banks know how to move numbers between computers. The slow part is settlement and compliance — making sure that everything is done in order, and making sure that banks, and money transmitters in general, are solvent, honest and not fronting for drug runners."

Someone showed the Kickstarter board a fancy PowerPoint presentation with lots of big numbers, they ran to invest a bunch of their own funds in a blockchain without stopping to ask their own devs if the tech had any value for what the site actually does, and now they’re desperately trying to justify it after-the-fact.

…that’s my current running theory, anyway.

More analysis of Kickstarter’s announcement here — including a bunch of background explanation, for people who still aren’t following what all the new tech terms mean.

When companies announce a vague “shift to blockchain” with no specific idea what they’re doing: “Back in 2017, we reported on the bizarre story of the Long Island Iced Tea Company rebranding itself as the Long Blockchain Corp. […] Now the Securities and Exchange Commission has revoked Long Blockchain’s stock registration, effectively banning the general public from trading its shares altogether.”

The big fraud in the heart of “Web3” discourse: “The cryptocurrency web3 starts with all our existing infrastructure. So I still need a DNS name, I still need a server, I still need storage, and I still have a distributed computation occurring between the browser and the server. So already I haven’t removed any of the gatekeepers from the conventional distributed system, showing the claims of gatekeeper-free decentralization are false. Web3 is only about adding an additional layer of complexity in the name of justifying the underlying cryptocurrencies.“

Problem links about NFTs/”cryptoart” specifically

A few days after the Kickstarter announcement, I got my first alert through DeviantArt Protect that an NFT is linking to one of my drawings without my permission. So it’s been an inauspicious week for blockchain news all around.

(As of this writing, the NFT-selling site is entirely ignoring the copyright claim…but I do appreciate DA for alerting me that it was happening at all. This is what a site that actually cares about its creative users looks like!)

A breakdown of what NFTs are — in straightforward terms, not in wild/ridiculous metaphors. (Which, to be clear, aren’t wrong — it’s just that I know many people don’t find them helpful.)

My days of regularly sharing this link are coming to a middle: Here Is The Article You Can Send To People When They Say “But The Environmental Issues With Cryptoart Will Be Solved Soon, Right?”

“You couldn’t store the actual digital artwork in a blockchain; because of technical limits, records in most blockchains are too small to hold an entire image. Many people suggested that rather than trying to shoehorn the whole artwork into the blockchain, one could just include the web address of an image […] Seven years later, all of today’s popular NFT platforms still use the same shortcut. This means that when someone buys an NFT, they’re not buying the actual digital artwork; they’re buying a link to it. And worse, they’re buying a link that, in many cases, lives on the website of a new start-up that’s likely to fail within a few years. “

2020: “The developers of non-fungible token project NiftyMoji pulled an exit scam as they have closed the official website, all social media and dumped their tokens on the market. Also the associated Coinbreeder accounts have vanished. The developers ran off with an estimated amount of one million dollars.“

Alternately, the link could get replaced with something else. Say, a bunch of random photos of rugs: “I just pulled the rug at my NFT collection on @opensea. Nobody got hurt. It is pretty easy to change the jpg, even if it does not belong to me or it is on auction. I am the artist, my decision, right?”

““The Billion Dollar Torrent,” as it’s called, reportedly includes all the NFTs on the Ethereum and Solana blockchains. These files are bundled in a massive torrent that points to roughly 15 terabytes of data. Unpacked, this adds up to almost 20 terabytes.”

Problem links about blockchains in general

Things crypto evangelists don’t like to talk about: “During a hard fork, software implementing bitcoin and its mining procedures is upgraded; once a user upgrades their software, that version rejects all transactions from older software, effectively creating a new branch of the blockchain. However, those users who retain the old software continue to process transactions, meaning that there is a parallel set of transactions taking place across two different chains.“

In other words: there isn’t one single, central version of Bitcoin. It has multiple versions, and they’re mutually incompatible with each other. And yet, some people still believe blockchain is the magic bullet that will make every website interoperable. Suuuure.

Also, if you’re hearing anyone talk about how miraculous and unhackable anything blockchain is:

November 2017: “On November 19, 2017, more than $30 million worth of Tether tokens were removed from the official Tether Treasury wallet by malicious hackers. Due to this security breach, Tether has executed a newly hard forked version of the Omni Core code, which powers the Tether network. Why? Because this code refused to transact any of the stolen tokens.”

December 2021: “One of BitMart’s addresses currently shows steady outflows of entire token balances, some worth tens of millions of dollars, to an address currently labeled by Etherscan as the “BitMart Hacker.” In a follow-up tweet, PeckShield estimated the losses to be $100 million in various cryptocurrencies on the Ethereum blockchain and $96 million on Binance Smart Chain.”

“it is not new to me. im a distributed systems engineer & programmer. ive been building shit like this for decades i serve a playerbase larger than most countries and have built networks spanning the globe. blockchain is old news. it is my job to find new technologies and use them if they’re better. these are not. they are bad, embarrassingly bad.”