This chapter examines cases where cryptocurrency has been used by terrorist actors. At the same time, the chapter also examines the important role played by the private sector in ensuring that virtual assets are not misused. The chapter also takes a peek at the role of government regulation in the industry and where the private sector has concerns regarding an overly interventionist approach that could stifle a new technology.

The leading early twentieth-century US proponents of a transformation in the social organization of money were – albeit far from unproblematically – collectivist and communitarian in ideological orientation, whereas those that succeeded them tended toward libertarian, individualistic, and free-market positions. This chapter offers the first examination of American literature’s connections to this latter wave of alternative currency campaigns, ranging from 1970s calls for privatized monies to contemporary cryptocurrency. It first introduces the foundational articulation of the right-libertarian approach to monetary reform, by the Austrian economist Friedrich Hayek, and connects these ideas to a classic of US avant-garde fiction as well as a landmark of the American libertarian literary canon. It then explores how two of the most renowned economically-themed American novels of recent decades – Lionel Shriver’s The Mandibles (2016) and Neal Stephenson’s Cryptonomicon (1999) – put a libertarian understanding of monetary innovation into dialogue with complex questions of trust, value, technology, nation, and identity. It concludes by reading an important recent addition to the tradition of American weird fiction – Michael Cisco’s Animal Money (2015) – as suggesting alternatives both to the too-narrow conceptions of the collective and to the privileging of the individual that have characterized visions of monetary transformation past and present.

This chapter covers the potential use of quantum algorithms for cryptanalysis, that is, the breaking and weakening of cryptosystems. We discuss Shor’s algorithm for factoring and discrete logarithm, which render widely used public-key cryptosystems vulnerable to attack, given access to a sufficiently large-scale quantum computer. We present resource estimates from the literature for running Shor’s algorithm, and we discuss the outlook for postquantum cryptography, which aims to replace existing cryptosystems while being resistant to quantum attack. We also cover quantum approaches for weakening the security of cryptosystems based on Grover’s search algorithm.

In the light of the growing interest in crypto-assets and the quest for their institutionalisation, we examine the role that they can play as investable assets useful in standard portfolio problems when asset returns are predictable. In particular, we study whether a mix of macroeconomic factors and crypto-specific predictors can be combined to produce accurate and economically valuable pooled forecasts. With reference to Bitcoin data, we uncover that crypto returns are predictable out-of-sample. Moreover, when this crypto-asset is made available to a mean-variance optimising investor, it generates large risk-adjusted realised performance gains irrespective of the assumed risk aversion. The results on the predictability of cryptocurrencies are robust to a generalisation to Litecoin and Ripple, although on a shorter 2015–2020 sample. However, results turn mixed and come to depend on the assumed risk aversion, when we investigate the power of forecast combinations to generate economic value from the entire pool of cryptocurrencies.

There has been progress made in the adoption of digital assets by institutional investors. Large institutions including Fidelity, BlackRock, and several investment banks have started providing products and services to satisfy the needs of their clients. Hedge funds and venture capital funds are also investing in digital assets. Global exchanges have introduced investable products based on cryptocurrency derivatives. The number of ways one can invest in digital assets is expected to grow with the introduction of new products. Digital assets are still very new and carry considerable risk. It is prudent of regulators to cautiously approach regulation. At the same time, the markets are looking for clarity from financial regulators. If and when there is more regulatory clarity, the pace of adoption is likely to pick up.

Secondary sanctions are unique in their audacity. Their application in an interdependent global context raises the specter of an uncontrolled burn, with consequences stretching beyond even their broadest scope. Such consequences reshape markets and, at times, create new ones. This chapter uses Iran as a lens through which to examine the relationship between the informal economy and US secondary sanctions and the potential disruption provided by the proliferation of cryptocurrencies. The chapter ultimately concludes that despite much-heralded potential, cryptocurrency’s disruption to the US financial system’s supremacy, as well as the sanctions regimes reliant on such supremacy, remains, for now, limited. This incomplete disruption means that any blunting effect provided by cryptocurrency on secondary sanctions cannot fully protect the informal economies and the participants therein from the effects of such sanctions, particularly in more protracted sanctions regimes. Indeed, cryptocurrency’s likeliest role in US sanctions is not to upend the secondary sanctions regime but rather to complicate the enforcement process. Given its rapid proliferation and built-in cryptography, cryptocurrency is likely to continue to make enforcement of sanctions more difficult, more expensive, and, perhaps, less appealing to pursue all potential evaders.

Fueled in part by the wealth created from digital currencies, major art dealers such as Christie’s and Sotheby’s have embraced the sale of non-fungible tokens (NFTs) attached to unique digital works of art. NFTs, how they are related to the blockchain, and the evolution of the market for digital art is the subject of this chapter. Despite recent decreases in value, it appears that digital art can be added to the growing list of uses for blockchain technology, which is now becoming a part of modern life. This chapter proceeds in five sections. First, the overview of the evolutionary progression of blockchain technology in the form of NFTs. Second, a description of the emergence of the market for digital art. Third, an explanation and historical account of digital art and related recent issues. Fourth, a coverage of the abrupt decline in the market price for many NFTs. And last, a conclusion, which focuses on how the dramatic extension of blockchain and other digital technology to the world of art represents a new and exciting platform for creative expression. This chapter offers a valuable addition to the literature by providing a readable introduction and overview of what is now known about the likely impact of blockchain technology and NFTs to art. Additionally, this important development should have a significant impact on the future of innovation and property law.

Chapter 5. Bitcoin emerged in 2009 from a community of libertarian cryptographers who sought an alternative payment system free from fiat inflation and from government payment surveillance and censorship. Today it provides an alternative payment rail that circumvents central banks. Bitcoin serves as a medium of exchange in some transactions, but not yet as a commonly accepted medium of exchange. The Bitcoin source code keeps the number of Bitcoin in circulation growing, at an ever-slowing rate, along a programmed quantity path. Basic monetary theory shows that this supply mechanism has pros and cons: It avoids money supply shocks, but it rules out any supply response to variations in demand, making the purchasing power of Bitcoin more volatile than that of gold or (relatively well-managed) fiat, which limits the attractiveness of holding Bitcoin as a medium of exchange. The costs of the Bitcoin industry are borne by its users, not by third parties, to the same extent as those of any energy-using private industry. The non-zero chance of its serving as a future global money means that Bitcoin has a fundamental value. It does not inherently rest on an unsustainable chain-letter or “bigger fool” process.

The defendant, Mr. Howey, had a prominent citrus grove in Florida. Mr. Howey sold real estate contracts with a warranty deed along with a service contract to manage the citrus grove on the land to mostly non-Florida residents staying at a local hotel he owned. The SEC filed suit claiming that Mr. Howey’s real estate contract, warranty deed, and service contract constituted an investment contract. The feminist perspective accounts for the power imbalance between Mr. Howey, a man in a town in which everything bears his name including the town itself, and the purchasers, travelers unaware of practicalities of the citrus business. This power imbalance was characterized by information asymmetry and fraud. The feminist rewritten opinion examines how the Howey test developed in the original opinion is both too detailed and too flexible, which fails to foster a responsible and inclusive investment culture. The commentary argues had Mrs. Howey, who had a significant role in cultivating the land, been given more consideration and protection in the original opinion that securities regulation could more adequately protect employees from exploitation.

This chapter identifies the factors likely to influence employees, managers, and firms given that businesses operate within the context of capitalism. Several common presuppositions about capitalism are discussed – consumers know best, industry and innovation will be rewarded, growth should be encouraged, no centralized distribution, and individual self-interest always leads to mutual benefit. The term “market morality” is introduced as a background for factors such as spending on nonrecyclable goods or a focus on price rather than employee conditions where the goods are made, providing a means to identify consumer hypocrisy and corporate greenwashing. The implications of market failures such as oligopolies are noted, and questions about proper use of government regulation are raised. Moral concerns about the globalization of supply chains and varying normative standards around the world are also discussed, as well as the balance between World Trade Organization standards and national sovereignty. The fact that currencies and credit rely on the moral principle of trust is considered. The final case deals with the ethical concerns that are raised when international companies promote GMO crops to poorer countries.