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A Furry’s Guide to Cryptocurrency

Normally when you see an article that talks about cryptocurrency come across your timeline, you can safely sort it squarely into two camps: For and Against. If you’re like me, you might even make a game out of trying to classify it into one bucket or the other from the first paragraph–sort of like how people treat biological sex–and then reading to see if you were right or not. Most of the time, you don’t even have to read past the headline to know where the author stands.

Unfortunately, the topic of cryptocurrency is complicated in ways only nerds could envision. And I’m not even talking about the cryptography involved when I say that.

(Art by Khia.)

Cryptocurrency is one of those cans I keep kicking down the road, lest all of its worms escape. I’m neither an enthusiast who wants to pump dogecoin to the moon, nor a detractor who thinks that the idea of digital cash is inherently stupid.

The “crypto means cryptography” trope exists because, after Bitcoin’s first price hike, a shitload of speculative investors flooded cryptography forums and drowned out the usual participants’ discussions. I’ve previously said that some gatekeeping is necessary for the maintenance group identity, and that the excess of this minimum amount is what creates toxicity. Unfortunately, this trope has far exceeded the LD50 for healthy discourse.

Some of my friends make their living working on cryptocurrency projects–as researchers, mathematicians, programmers, security engineers, and so on. A lot of the interesting cryptography breakthroughs we’ll see in the next 10-15 years will be, at least in part, the result of cryptographers working in the cryptocurrency space. It’s difficult to talk about zero-knowledge proofs without acknowledging some of the kick-ass research the Electric Coin Company has done in order to launch their privacy-preserving cryptocurrency, and that’s only one example.

Here’s cryptographer Jean-Phillipe Aumasson, whose employer is launching a regulated cryptocurrency marketplace:

If you’re not familiar with JP’s work, he wrote several cryptography books (including Serious Cryptography), contributed to several hash functions (SipHash, BLAKE2, and BLAKE3), and initiated the Password Hashing Competition that resulted in Argon2.

However, there’s also a lot of bullshit in the cryptocurrency space.

  • Years of securities fraud enabled by “Initial Coin Offerings” (ICOs) on the Ethereum blockchain. Most famously: Bitcoiin (yes, with two I’s) whose spokesman was bad movie star, Steven Seagal.
  • The plague of hacked Twitter accounts pretending to be Elon Musk, perpetuating a “give me some $ and I’ll give you more back” scam that’s sadly effective.
  • The whole cryptoart / NFT debacle.
  • Litanies of startups trying to “use blockchain to solve X problem” without ever asking if the problem warrants a blockchain in the first place.
  • Every microgram of drama related to John McAfee.

And those are just the items I can list off, off the top of my head. The awfulness surrounding cryptocurrency is like a fractal: The deeper you look at it, the more shit you see.

Cryptocurrency Subculture: A Tale of Too Shitty

The world’s most successful cryptocurrency to date, Bitcoin, was created in 2008 by an anonymous cryptographer who liked to be known as Satoshi Nakamoto and distributed on metzdowd.com, a mailing list created by a group of cryptoanarchists that called themselves “cypherpunks”.

At the risk of being overly reductive, cryptoanarchists are people who believe strongly in a right to privacy and therefore the right to use cryptography to protect communications from others–be it governments, corporations, or jealous ex-lovers. The cypherpunks were a group of cryptoanarchists that also wrote code. It’s a wordplay on “cyberpunk”.

It’s difficult to speculate about the intentions or politics of Satoshi Nakamoto, considering they said very little of substance about their private beliefs, and no longer answer emails from random strangers. However, given their presence on metzdowd, it’s reasonable to propose they were at least sympathetic to the cypherpunks’ cause.

Most outspoken cryptocurrency enthusiasts today are not like Satoshi Nakamoto. They don’t understand or frankly give a shit about complex, nuanced points about privacy and the government machinations underpinning public safety–let alone how that intersects with the racist history of the institutions charged with keeping the public safe. They’re largely anarcho-capitalists who want to make as much money as they can and, in turn, pay as little as possible in taxes.

How do you make money in cryptocurrency?
By obtaining some amount of a coin, then convincing other people to buy it to drive up the demand, and therefore the price, and then sell at a later date. Then you can sell your coins at a higher price than you paid (either directly, or through energy costs from “mining”) and pocket your profits.

Don’t let the name fool you: anarcho-capitalists (a.k.a. ancaps) aren’t anarchists (and furthermore, cryptocurrency-manic ancaps aren’t cryptoanarchists). Here’s a helpful video to disambiguate the terms involved:

If I said that large swaths of the cryptocurrency community was generally shitty, I would not be the first to make this observation. The earliest Bitcoin events were caricatures of the kind of toxic sexist excess that dominates chauvinistic power fantasies. (“When lambo?”)

It’s not just the bad politics or the stark contrast between cryptocurrency in practice and cryptocurrency as envisioned by the earliest architects on the metzdowd cryptography mailing list.

Last year I wrote about a dumb attack against the second hash function used by the cryptocurrency, IOTA. After I wrote this story, my Twitter mentions and DMs were flooded with astroturfing attempts by IOTA enthusiasts. Nearly a year later, most of those have been deleted–presumably because of an account suspension.

This tweet brought to you by some fucking guy.

Before IOTA, Monero enthusiasts used to engage in bad faith with anyone that dared criticize their favorite cryptocurrency project on Reddit or Hacker News.

To be clear: I don’t think that cryptocurrency projects or their developers are ever necessarily responsible for the behavior of their users. Sometimes you find toxic assholes like Sergey Ivancheglo (the IOTA developer that threatened security researchers) at the helm, and then immediately jettison it until they leave (to great fanfare of the non-toxic part of their community).

I don’t want to overstate my case here. A lot of blockchainiacs are just downright awful people. The absolute worst. But I’ve found over the years that, the less a person talks about cryptocurrency as a financial endeavor (e.g. speculative trading), the less likely they are to be shitty. It’s not a law of the universe, but it’s a useful measuring stick.

But with all that in mind, an obvious question emerges.

If there’s so much awful shit surrounding cryptocurrency, why would furries (a subculture that constantly receives endless helpings of flak from society at large) ever venture near cryptocurrency?

The Politics Inherent to Furry Identity

Art by Swizz.

A lot of Americans like to think of themselves as “Free Speech” proponents. Some of them get all sweaty over whether or not they should be allowed to broadcast, and profit from, bigoted or hateful content laden with slurs.

And yet, the most censored people in American society are, without a doubt, sex workers. And you rarely hear any so-called “Free Speech” proponents give an iota of shit about the plight of sex workers. They can’t even freely engage in commerce here.

Sex work is explicitly banned by most financial service providers, such as PayPal. It’s exceedingly difficult for sex workers to make ends meet without constantly having to worry about their accounts being frozen and funds inaccessible.

There are a lot of reasons why the plight of sex workers is so bad in America. At the top of the list is the intersection of conservative politics and evangelical Christianity, which overall condemns healthy and consensual expressions of human sexuality. (Ever noticed how the only people who think they have a “sex addiction” are religious or right-wing? Not a coincidence.)

Do you know who else is a target of evangelicals and conservatives?

Furries, as you might know, are widely considered an LGBTQIA+ subculture (although not all of us are LGBTQIA+; only about 80%). But we’re more than just an LGBTQIA+ subculture. We’re also a vibrant community filled with skilled artists. Some of this art is pornographic in nature. It turns out, when queer people aren’t forced into the closet, they tend to embrace shameless authenticity and celebrate their romantic and sexual attractions with pride.

Maciej sums it up pretty well.

A few years ago, the Death Eaters in Congress passed two bills (FOSTA and SESTA) that were advertised as an attempt to crack down on “sex trafficking”.

In practice, these laws killed Pounced.org–the only furry “dating” site at the time that wasn’t a sketchy cash grab (FurryMate, FurFling, etc.). Pounced.org died because the cost to avoid being criminally prosecuted under these laws was so exorbitant that they couldn’t sustain the website anymore, and it probably wasn’t the only small dating site to be killed by poor legislation. Only the big players could really have front-loaded these costs.

Which leads to the meat of this issue…

Why Furries Might Be Interested in Cryptocurrency

Cryptocurrency can be very attractive to members of the furry fandom because of the bullshit baked into the societies and cultures we exist in.

Cryptocurrency promises to be permissionless and decentralized; to bank the unbanked. If you make your living filling up someone else’s spank bank, the idea of creepy rich white men not being able to exercise targeted censorship against you or your family is, frankly, irresistible.

“Can’t use PayPal for your trade? Just setup a cryptocurrency wallet and give a different address to each of your clients, and instructions on how to access some vaguely reputable cryptocurrency exchange.”

Granted, most furries aren’t sex workers or porn artists, but some of our friends are, and we want to see them protected. But there’s another threat that cryptocurrency promises to alleviate: Chargeback fraud.

The prevalence of chargeback fraud is why I always tip artists. It helps to offset some of the harm caused by shitty behavior.
(Art by Khia)

This is the usual story (although exceptions do exist) I heard from my artist friends:

Someone under 18 decides they want to commission an artist they cannot personally afford, so they steal their parent’s credit card and use it to pay for a commission. Later–often after the work has been completed and delivered to the client–their parent notices the unauthorized charge on their credit card, and issues a chargeback.

Not only does this steal from the artist, but it incurs a $35 fee and increases the risk of their account being permanently suspended by their payment provider–thereby preventing them from accessing the funds paid to them by legitimate customers.

“Thanks for the free art! Now you’re at least $35 poorer and maybe lost your only lifeline out of perpetual poverty.”

— Assholes

And thus, the Siren Song repeats once again!

Cryptocurrency doesn’t prevent chargeback fraud, but it does shift the risk from independent artists that have no capital or political power and onto billion dollar financial institutions like Coinbase.

Once the cryptocurrency has been transferred from the Coinbase wallet to the furry artist, it cannot be unspent. Bad faith behavior might still happen, but the artist doesn’t risk their livelihood because of it.

And that’s why, when furry auction site The Dealer’s Den announced a plan to rebuild with “Blockchain Technology”, I didn’t even bat an eye. It seems like an obvious solution to a pervasive unsolved problem to me.

Sure, it’d be great if we could solve this problem with sensible civil policy. But when is that going to finally happen? After all, we’re talking about the same governments that bungled COVID-19 last year, and the AIDS crisis last century, and so on…

However, and this bears emphasizing, the CryptoArt / NFT trend is not a valid reason to get involved in cryptocurency! As I said on Twitter:

So, super long preamble aside, what I thought I’d do today is talk a bit about cryptocurrency and how to engage with the topic responsibly, especially if you’re trying to mitigate the damage of the systems we inherited.

Cryptocurrency For Furries

I’m going to be very light on technical jargon, in the interests of accessibility, but at the risk of being imprecise.

No two cryptocurrencies are created equal. If you’re hoping to use one to mitigate systemic harms to our community, I implore you to learn the technical details in depth.

Decentralized Consensus

Cryptocurrencies can be classified by something called their consensus mechanism, which is how they can maintain a consistent ledger without being centralized. It doesn’t really matter, for the purpose of this article, how any of them work. I’m happy to dive into that in a future blog post, should anyone want it.

What you need to know is that Proof-of-Work (PoW) consensus algorithms are designed to maximize energy waste across the entire cryptocurrency network. That’s how it maintains its security against different kinds of esoteric-sounding attacks.

When you “mine” a Proof-of-Work cryptocurrency, what you’re doing is solving a computationally hard puzzle (e.g. find a number that, when combined with the previous block’s hash and your address and hashed, produces a specific number of leading 0 bits determined by an algorithm to ensure this happens at a set average frequency of time), which results in the entire network agreeing that your address gets the “block reward” (a fixed amount of whatever currency) plus transaction fees.

Cryptocurrency discussions frequently invite conversations about the environmental impact of mining. Proof-of-Work is the cause for this excess energy use which certainly contributes to global climate change.

So, if you’re going to get involved with cryptocurrency without contributing to global climate disaster, you’re going to want to avoid Proof-of-Work cryptocurrencies. There are several other options to choose from.

Proof-of-Stake is popular among my cryptocurrency nerd friends, although it receives a fair bit of criticism from experts (especially the “nothing at stake” problem). Ask your cryptographer. It’s probably not me.

On-Chain Privacy

The vaunted “blockchain” is a public, transparent record of all transactions.

When you use a cryptocurrency like Bitcoin, it’s sort of like tweeting your financial activities for the world to see.

“But nobody knows who owns this address,” Bitcoin maximalists might argue. To which I point out: Nobody is supposed to know your sockpuppet Twitter accounts either, but when you use them to harass someone right after they block your main account, we know it’s you.

The people whom this applies to know who they are, and should stop.
(Art by Khia)

Some cryptocurrencies, like Zcash, try to provide something like TLS for your transactions. When you use shielded Zcash addresses, the transaction amounts and recipients are encrypted, and this ciphertext is accompanied by a zero-knowledge proof to ensure the total amount in the shielded and unshielded pools remains consistent.

I highly implore you to choose a cryptocurrency that has on-chain privacy, especially if your target audience includes queer people and/or sex workers.

Mainstream Appeal

Finding a privacy-preserving cryptocurrency that doesn’t equate to Global Warming Bucks is a tall order, but if you want people to actually use a cryptocurrency, it needs to be accessible.

By accessible, I mean available on all the mainstream cryptocurrency exchange platforms (Coinbase, Binance, Bitfinex, etc.).

This might sound like pointless gatekeeping, but remember: They have the money and lawyers to negotiate with the economic powerhouses of the world, while sex workers and furry artists do not.

Cryptographic Security

Any regular reader of Dhole Moments probably saw this section coming a mile away, but an important consideration for a cryptocurrency to build upon is whether or not it’s actually secure.

This is where things get tricky. Weird or poor choices in cryptographic algorithm don’t seem to matter much.

Bitcoin uses ECDSA over Koblitz curves. IOTA shipped two broken hash functions, threatened researchers, and then tried to claim the first broken hash function was backdoored for “copy protection”. The CryptoNote currencies (n.b. Monero) tried to build on EdDSA but introduced a double spend attack.

I’m certainly not qualified to audit an entire cryptocurrency and say “yes/no” on its security. But any cryptocurrency you consider should at least pass a smoke test from your cryptographer.

Which Cryptocurrency Should I Choose?

If you’re looking for a cryptocurrency that’s secure, accessible, privacy-preserving, and doesn’t waste a fuck ton of energy all the time, the short answer is that there is none. You’re going to have to make a trade-off.

Shocking, I know.
(Art by Khia)

I’m sure there are cryptocurrency projects that use privacy-preserving technologies without a Proof-of-Work algorithm, and their design and implementation might even be secure! But, to date, I’m not aware of any such projects that also have mainstream accessibility on large exchange platforms.

You’ll notice that I didn’t mention price volatility in my list above. There’s two reasons for that:

  1. I’m not a financial expert. For all I know, price volatility might be something you want out of your cryptocurrency, especially if you’re LARPing a day trader.
  2. It’s hard enough to make this choice without adding more complications to the formula.

If Zcash ever adopted a consensus algorithm that wasn’t Proof-of-Work, it’d be a shoe-in for me to recommend. It checks all the other boxes neatly and is one of the most interesting cryptography projects on the Internet, after all.

In the meantime, maybe some other project will fill this niche and become widely accessible for everyone. There’s a lot of exciting and/or scary things happening with cryptocurrency research.

If you’re stuck with a hard decision, honestly, just do the best you can and be very transparent about the trade-offs you’re making and why you’re making them. Then ask a friend or expert to check your reasoning before you commit to it. “Do nothing” also needs to be publicly considered, no matter how absurd it might seem.

Disclaimers and Other Remarks

I do not work with cryptocurrency in my dayjob. I’d like to say that, consequently, I don’t have a conflict of interest, but all humans have subconscious biases, and a lot of my favorite people in cryptography do work in or with cryptocurrency. I want my friends to be able to continue to do awesome work without feeling ashamed.

Thus, I don’t care if you invest in Bitcoin or Dogecoin or whatever. Shoot for the moon while you awoo at the moon. Just be careful; for every winner, there’s at least one loser.

Fact: Dholes are also known as “Whistling Dogs”
(Art by Khia)

I’m a fan of transparency logs–which are often compared to blockchains, but without the currency aspect. If you’re not familiar, read up on Trillian and Chronicle. Notably, Trillian is the backbone of Certificate Transparency, which helps keep the CA infrastructure honest and consequently makes HTTPS safer for everyone.

By Soatok

Security engineer with a fursona. Ask me about dholes or Diffie-Hellman!

3 replies on “A Furry’s Guide to Cryptocurrency”

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