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article imageWhy social media is banning cryptocurrency ads: Interview Special

By Tim Sandle     Mar 22, 2018 in Business
Following the footsteps of both Google and Facebook, Twitter will now also ban advertisements related to cryptocurrencies. Why is this and what do they fear? Joe McCann, Founder and CEO of NodeSource explains.
Founder and CEO of NodeSource, Joe McCann was a former Wall Street trader and has a current interest in trading cryptoassets. As an entrepreneur, he has developed his own bot via telegram to manage his trading. He is also savvy at making predictions.
McCann is also concerned with the move by social media companies to restrict or ban adverts for cryptocurrencies. In comunication with Digital Journal, McCann said: "Twitter’s ban on cryptocurrency-related advertising is only more validation for this new asset class. Governments and now media outlets are attempting to "protect" the public from this burgeoning asset class when in reality, the global populous is moving forward without them. Scam artists exist everywhere including highly regulated industries as noted with the Bernie Madoff scandal. With moves by startup unicorn Coinbase into areas like custody and many institutional investors vying for access to the cryptoassets market, stopping the flow of information via advertising is analogous to putting a band-aid on a crack in a dam."
To find out more, read our interview with Joe McCann below.
Digital Journal: How important are cryptocurrencies set to become for businesses?
Joe McCann: I'm not sure cryptocurrencies, or more broadly, cryptoassets are going to be important for business as most cryptoassets are generally the economic incentive for supporting the underlying blockchain use-case. Blockchain as a technology will be incredibly important for every business that deals with data...which is in essence, every business.
DJ: What are the leading types of cryptocurrencies and are all cryptocurrencies legitimate?
McCann: The obvious ones are bitcoin, ether, litecoin, bitcoin cash and monero. With other, it really depends on how you define "legitimate". If there is a market for something, people will buy and sell it. Does that give it legitimacy? Not sure. I think with any maturing asset class or marketplace, you will have nefarious actors scamming people. This has happened many times with ICO's but recall, even highly regulated industries have scammers - Bernie Madoff.
DJ: What advantages do cryptocurrencies have over traditional forms of payment?
McCann:Cryptocurrencies and their subsequent values are not predicated on a myth. The U.S. Dollar is built upon the idea that a green piece of paper has value because we all believe that it does. You can't eat or wear or do anything useful with the green piece of paper but because we all believe it has value, then it actually has value.
Moreover, the U.S. Dollar (and any national currency for that matter) is controlled by a centralized organization (the Federal Reserve) that determines the current money supply which impacts inflation and subsequently impacts many things from interest rates on mortgages to various assets' valuations. Given the crisis that occurred in 2008, it is clear to many people that a centralized organization that will flood the market with additional money to "prop up" the instability is not healthy as we now have created a hyper-inflationary currency market that has not benefitted the majority of the populous.
Cryptocurrencies could not be more opposite. One, bitcoin is a store of value that can be exchanged anywhere in the world in seconds with no "middle-man" slowing it down or taking an egregious fee. The folks that are running Bitcoin nodes (computers running the Bitcoin protocol) get paid the fee for validating the transaction and recording it in the public blockchain. Moreover, Bitcoin has a finite money supply that will never eclipse 21,000,000 total bitcoin.
This removes the potential for a hyper-inflationary currency that a central bank could introduce as the money supply was determined in advance of launching Bitcoin. Finally, bitcoin the cryptocurrency, is not built upon a myth -- it is built upon math. The computers mining bitcoin and providing stability to the decentralized Bitcoin network are relying on solving difficult math or computational problems to verify and validate the creation of new bitcoin and transactions involving bitcoin. There is no myth here which has been the case with money since its inception.
DJ: Are cryptocurrencies key to blockchains?
McCann:Cryptoassets are the economic incentive for people to run an instance of the asset's underlying blockchain implementation. They are not required, but altruism is not a great incentive for most. Private blockchains, say, at an enterprise company, don't need a cryptoasset per se as the blockchain is in a controlled environment.
DJ: Why have Google, Facebook, and Twitter banned cryptocurrency adverts?
McCann:Who knows! But, I'd argue it is either pressure from the SEC, FTC or their own internal policies around entities promoting scams, particularly ICOs. Unfortunately, this will not do much good as more and more people are getting their information about cryptoassets and ICOs in places like Telegram, Whatsapp and Slack.
DJ: How about governments, why do they feel threatened?
McCann:Governments are threatened not only by cryptoassets and their usage, but a broader movement - decentralization. For millennia, governments have ruled by force, politics and mythology within their own borders. With the dawn of the internet, borders simply vanished and now with the one thing that governments have immense power over, money, slipping into decentralization where no one and everyone has the power, is a tectonic shift to the way governments govern. How can you control what someone earns, spends, consumes or produces when you simply can't control it? This move towards radical decentralization is arguably the most dramatic shift in human history.
DJ: Where do you see cryptocurrencies in the next three to five years?
McCann:Cryptoassets will have a number of failures, some severe, but the most stable and well supported ones will rise. I'd suspect that this is still the first inning when it comes to cryptoassets as an asset class but as more and more products and services are built around the cryptoassets class, more and more users and consumers of cryptoassets will emerge. In essence, cryptoassets are never going away.
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