Decoding the Future
Decoding the Future
3.01 | "Change is inevitable. Growth is optional." - John Maxwell
News and Numbers
Markets this Week:
S&P 500 is trading flat
NASDAQ 100 is up 1%
Bitcoin-USD is down 3%
Ethereum-USD is down 3%
Headlines from this Week:
Robinhood announced plans to launch 24-hour stock trading platform from 8:00 AM(ET) Mondaysthrough 8:00 PM (ET) Friday.
Months after cutting ties with Kanye West, Adidas has decided to sell Yeezy shoes from its remaining inventory and donate the proceeds to charitable organizations.
Google unveiled a suite of A.I. products and features at its I/O event, including AI writing tools for gmail, removal of waitlist for bard, and generative AI for search.
U.S. Chamber of Commerce Backs Coinbase in SEC Fight.
Binance will withdraw from the Canadian market, the cryptocurrency exchange announced on Twitter, May 12.
Finance
By Vlad Estoup, B.Comm. (Finance), working in Ethereum cybersecurity
How Crypto(graphy) is shaping finance
Just a heads up, this will be a bit of a more techy piece. I want to help demystify cryptography and show you how it is used in the Ethereum context. If you’re a seasoned Web3 developer, you probably already know this stuff. And if you are not, this is some cool basic knowledge about why crypto has its name :)
In the realm of digital finance, cryptography plays a pivotal role in revolutionizing the way we interact with money on the internet. The advent of cryptocurrencies, led by the groundbreaking Ethereum blockchain, has brought about significant advancements in secure and decentralized financial transactions. The very name "crypto" signifies the intrinsic connection between cryptography and the world of digital currencies, as cryptographic algorithms form the backbone of the security measures employed within blockchain networks. Two fundamental cryptographic techniques, namely Elliptic Curve Digital Signature Algorithm (ECDSA) and Keccak256, hold paramount importance in Ethereum's ecosystem, with each having distinct applications: ECDSA for signing transactions and Keccak256 for generating addresses.
Why cryptography?
Traditional financial systems rely on centralized authorities to facilitate and validate transactions. However, these systems are susceptible to security breaches and require trust in third parties. Cryptography addresses these shortcomings by utilizing mathematical algorithms to secure transactions and enable trustless interactions on the Ethereum blockchain. It ensures the confidentiality, integrity, and authenticity of financial transactions without the need for intermediaries.
ECDSA for Signing Ethereum Transactions
In Ethereum, every transaction requires a signature to prove its authenticity and authorize the transfer of value. Say I want to send you $50. If I am not the sole party responsible for releasing the funds, I am vulnerable to an attack. I can delegate this power (the equivalent of a VOID cheque, or giving my little brother my credit card), but I am still expected to be in control of how the funds are spent.
ECDSA, a widely-used cryptographic algorithm, is the foundation for generating digital signatures in Ethereum transactions. This is what guarantees the legitimacy of the funds’ transfer. ECDSA leverages the mathematical properties of elliptic curves to provide secure and efficient digital signatures. If you want to dive a bit deeper into elliptic curves, check out my buddy’s video on the basics.
The Ethereum network employs ECDSA for several reasons. Firstly, ECDSA provides strong security, offering protection against malicious attacks attempting to forge or tamper with transaction data. The use of elliptic curves allows for smaller key sizes, reducing computational overhead and improving efficiency. Additionally, ECDSA enables fast signature generation and verification, facilitating a smooth and responsive transaction experience for Ethereum users.
Keccak256 for Generating Ethereum Addresses
An Ethereum address serves as a unique identifier for users on the network and is crucial for initiating transactions. This is your unique identifier on the blockchain, so it is important that nobody can have the same one, as this would create chaos.
Keccak256 is a cryptographic hash function that plays a vital role in generating these addresses. Ethereum addresses are derived from the public keys corresponding to ECDSA key pairs. Now, there is a more complex opcode called CREATE2, which takes in more parameters in order to spit out your address. You can learn more about this in EIP-1014.
Keccak256's strength lies in its ability to generate a fixed-length, unique hash output for any given input. This property ensures that each Ethereum address is distinct and provides a high level of collision resistance. Keccak256 produces a 256-bit hash, which ensures a vast address space, making it computationally infeasible to derive a private key from a given address.
Moreover, Keccak256 offers excellent performance and computational efficiency, enabling rapid address generation and verification. Its utilization within Ethereum ensures that addresses are secure, immutable, and resistant to tampering, safeguarding users' funds and maintaining the integrity of the blockchain network.
Cryptography is at the core of the transformative potential of digital finance, enabling secure and decentralized transactions on the Ethereum blockchain. The Elliptic Curve Digital Signature Algorithm (ECDSA) serves as the bedrock for signing Ethereum transactions, ensuring their authenticity and security. On the other hand, Keccak256, a cryptographic hash function, plays a vital role in generating Ethereum addresses, providing unique identifiers for users while maintaining robustness against attacks.
As the Ethereum ecosystem continues to evolve and expand, cryptography will remain an indispensable tool in ensuring the trustworthiness and security of financial interactions. By harnessing the power of cryptographic techniques like ECDSA and Keccak256, Ethereum paves the way for a decentralized financial future, empowering individuals to take control of their financial lives in a transparent and secure manner.
This is not financial advice and you should always do your own research before investing in any securities or cryptocurrencies.
Sci-Tech
By Keyann, Software Engineer in Web3
McKinsey: What every CEO should know about generative AI - Summarized by A.I.
Image prompt: “a robot dressed as a teacher, teaching in a classroom to a bunch of students wearing suits, in the style of vapourware“
This week, McKinsey put out a big article about AI. So, I used A.I. to summarize it and make it digestible. I thought it’s important in order to get a perspective of how companies are thinking about adapting to A.I.. This provides a glimpse into what future labour markets may demand.
The article explores the potential of generative AI and its impact on work processes across various industries. Generative AI refers to the ability of AI systems to generate new content, such as text, images, and code. It can automate, augment, and accelerate work, transforming how tasks are performed in organizations. While generative AI encompasses various types of content, this article focuses on its applications in text-based scenarios.
Generative AI offers several capabilities, including classification, editing, summarization, question answering, and content generation. These actions can create value by changing how work is done across different business functions and workflows. The article presents examples of generative AI applications in different use cases.
One example is the use of generative AI to enhance the productivity of software engineers. By implementing an AI-based code-completion tool, engineers can write code descriptions in natural language, and the AI suggests code blocks that match the description. This tool can significantly speed up code generation and improve debugging processes. However, skilled software engineers are still necessary to ensure the quality and security of the generated code.
Another example focuses on supporting relationship managers in the banking sector. By leveraging a generative AI solution, relationship managers can quickly obtain synthesized answers to questions by scanning large documents, such as annual reports. This tool improves analysis efficiency, job satisfaction, and the ability to offer tailored services to clients.
Generative AI is also applied in customer support scenarios. By fine-tuning a foundation model optimized for conversations, companies can develop customer-service bots that handle most customer inquiries. This frees up support representatives to focus on higher-value tasks, improves efficiency, and enhances service standards and customer satisfaction.
The most complex use cases involve building custom foundation models from scratch. For example, in drug discovery, a pharmaceutical company trains its own model to analyze microscopy images and predict potential therapeutic candidates. This application accelerates research and development efforts, leading to more efficient and effective drug discovery processes.
The article highlights the importance of CEOs embracing generative AI as a transformative opportunity for their organizations. CEOs should work with cross-functional teams to identify use cases, assess costs and risks, and develop a technical roadmap. It emphasizes the need for a modern data and tech stack, partnerships with generative AI vendors, and the acquisition of talent with the necessary skills.
CEOs should balance the value creation potential of generative AI with associated risks. Ethical principles and guidelines should be established, and ongoing compliance and risk management practices should be in place. The article recommends a lighthouse approach, starting with small-scale implementations to gain experience and momentum before scaling to broader use cases.
The conclusion emphasizes that generative AI is still evolving rapidly, and companies should begin exploring its potential. Each organization should determine its own starting point based on its goals and risk appetite. By embracing generative AI and leveraging its capabilities, businesses can drive innovation, improve productivity, and gain a competitive edge in their respective industries.
In summary, generative AI has the potential to revolutionize work processes across industries. By leveraging its capabilities in classification, editing, summarization, question answering, and content generation, organizations can automate tasks, improve efficiency, and unlock new possibilities. However, careful consideration of costs, risks, talent requirements, and ethical considerations is essential for successful implementation.
Paradigm Shift
By Roman Kuittinen-Dhaoui, BBA (Hons.), CPHR Candidate
Being Grateful For What You Didn’t Get
Being thankful for the things you didn't receive can be a difficult mindset to adopt, but it is one that can have a profound impact on your life. It is easy to focus on the things we want or believe we need, but sometimes the things we don't receive can be blessings in disguise. For example, Alternatively, you may have wanted that particular used car, but someone else bought it and the accompanying hefty maintenance bils. When we appreciate the things we didn't receive, we open ourselves up to new possibilities and opportunities that we may not have considered otherwise.
Another reason to be thankful for the things you didn't receive is that it helps cultivate a sense of gratitude and contentment. It is easy to fall into the trap of always wanting more, but by focusing on what we have instead of what we lack, we can find joy in the present moment. For example, you may be sad that you got rejected from a particular school, yet that shouldn’t stop you from celebrating your acceptance into another school. By acknowledging that the things we didn't receive may have been for the best, we can learn to trust the universe and our own inner guidance, which can lead to a more fulfilling life.
Finally, being thankful for the things you didn't receive can help you develop resilience and a growth mindset. It takes strength and courage to accept disappointments and setbacks, but by reframing them as opportunities for growth and learning, we can develop a more positive outlook on life. For example, you may have gotten rejected by a hot person, but what you didn’t know is thay they had an sexual transmittable infection/disease. When we approach challenges with a sense of gratitude and openness, we are more likely to find creative solutions and to emerge from difficult situations stronger and more resilient than before.
TLDR: Sometimes what you didn’t get opens up the door for something even better
(Head)Space
Just believe you can do it
By Vlad
I have been going through a program that is probably one of the most intellectually challenging things I’ve ever done. Basically, I’m studying to become a security researcher in blockchain, starting from…well…scratch.
I’m almost done with the program, and I’m learning a lot, but I want to share what I learned about myself throughout this journey.
You are who you want to be. I often told myself that I would never get to a level of understanding that would be on par with my colleagues. Especially not in so little time. Enter a new hire, who is in their late teens and just finished highschool (no university background, nothing). They just sold their startup in the 8 figures, and have been in the space for under 3 years. Yeah, your excuses sound a bit whiny right about now.
Sacrifices are not really sacrifices. When I felt that I had to give up on a night out with my girl, or an evening with friends, or even going to the gym in order to study, given I am already quite ahead in my career and did not “need” to do any of this, I originally perceived it as a sacrifice. Once I got near the other side of things, I realized that the sacrifice was the other way around. I would be sacrificing a more exciting career and future, and my own growth, for momentary pleasures, and end up at the same place. See, it’s stagnation that makes you bored. If you are progressing aggressively, you are never bored.
There is an “aha” moment. At some point, things click. And when they click, you are just completely submerged in the thing you are learning. Now you’re the expert, and everyone else is looking to you for technical reassurance. If you haven’t had a clear “aha” moment in whatever you are learning, you are just not far along enough on the journey yet. Keep going.
Company of the Week
MercadoLibre
MercadoLibre, Inc. (Nasdaq: MELI) is an Argentine company headquartered in Montevideo, Uruguay, incorporated in the United States that operates online marketplaces dedicated to e-commerce and online auctions. MercadoLibre is Latin America’s leading e-commerce technology company.
It operates Mercado Libre Marketplace, an automated online commerce platform that enables businesses, merchants, and individuals to list merchandise and conduct sales and purchases online; and Mercado Pago FinTech platform, a financial technology solution platform, which facilitates transactions on and off its marketplaces by providing a mechanism that allows its users to send and receive payments online, as well as allows users to transfer money through their websites or on the apps. The company also offers Mercado Fondo that allows users to invest funds deposited in their Mercado Pago accounts; Mercado Credito, which extends loans to certain merchants and consumers; and Mercado Envios logistics solution that enables sellers on its platform to utilize third-party carriers and other logistics service providers, as well as fulfillment and warehousing services for sellers. In addition, it provides Mercado Libre Classifieds, an online classified listing service, where users can list and purchase motor vehicles, real estate, and services; Mercado Libre Ads, an advertising platform, which enables large retailers and brands to promote their products and services on the web; and Mercado Shops, an online storefronts solution that enables users to set-up, manage, and promote their own digital stores.
Excerpts from the 2022 fourth quarter letter to shareholders:
Net Revenues of $3.0 billion up 56.5% year-over-year on an FX neutral basis
Income from operations of $349 million, with a 11.6% margin
$36.0 billion Total Payment Volume, up 80.0% year-over-year on an FX neutral basis
$9.6 billion Gross Merchandise Volume, up 34.7% year-over-year on an FX neutral basis
Written by: Vlad Estoup, Keyann Al-Kheder, and Roman Kuittinen-Dhaoui