Monthly Archives: August 2020

U.S. Department of Education reaffirms commitment to protecting the religious liberty of students, religious organizations – The Highland County Press

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U.S. Secretary of Education Betsy DeVos announced Friday guidance to protect the religious liberty of individuals and institutions participating in Department of Education programs. This action is part of ongoing efforts by the Department to advance religious liberty protections and delivers on President Donald J. Trumps Executive Order 13798, Promoting Free Speech and Religious Liberty.

This administration will continue to protect the religious liberty and First Amendment rights of every student, teacher and educational institution across the country, Secretary DeVos said. Too many misinterpret the separation of church and state as an invitation for government to separate people from their faith.

In reality, the First Amendment doesnt exist to protect us from religion. It exists to protect religion from government. Todays guidance reaffirms our commitment to protecting our first liberty and ensuring that discriminatory restrictions on access to federal grant funding are no longer tolerated.

This guidance follows recent Supreme Court victories for religious liberty, asEspinozav. Montana Department of Revenueand Trinity Lutheran v. Comercurtailed religious discrimination and thus strengthened protections for religious organizations.

The guidance was drafted pursuant to a directive from the Office of Management and Budget requiring each agency to publish policies detailing how they will administer federal grants in compliance with Executive Order 13798, as well as the Attorney Generals Oct. 6, 2017, Memorandum on Religious Liberty, and the Office of Management and Budgets Jan. 16, 2020, Memorandum.

Notably, the guidance announces a new process by which individuals and organizations can inform the Department of a burden or potential burden on their religious exercise under the Religious Freedom Restoration Act (RFRA) to adequately protect their religious liberties while participating in Department programs.

The new guidance also, consistent with First Amendment principles and Department regulations, does the following:

Affirms that religious organizations are equally eligible to participate in ED-administered programs as their secular counterparts.

Affirms that financial award decisions are made based on merit, not based on an organizations religion, religious belief or the lack thereof.

States that religious organizations receiving federal financial assistance under a Department program must comply with program-specific legislation and regulations, but clarifies that these organizations may continue to carry out their missions and maintain their religious character. However, direct federal financial assistance may not be used for religious worship, religious instruction or proselytization.

Reminds states that they may not use discriminatory Blaine Amendments to deny faith-based organizations contracts or grants, as this violates Department regulations against discrimination on the basis of an organizations religious character or affiliation.

Affirms that students and/or borrowers seeking to participate in Department loan programs and beneficiaries seeking to participate in Department social service programs will not be penalized or singled out for disadvantages on the basis of religion.

Clarifies the role of the Departments Center for Faith and Opportunity Initiatives (CFOI) as a Department office that collaborates with faith and community leaders to maximize participation of religious organizations in Department programs while eliminating barriers in the grantmaking or regulatory process to safeguard religious liberty.

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U.S. Department of Education reaffirms commitment to protecting the religious liberty of students, religious organizations - The Highland County Press

Temporary order of protection issued against Meiers Corners woman in hate-crimes case – SILive.com

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STATEN ISLAND, N.Y. -- A Meiers Corners woman charged with multiple counts of harassment as a hate crime was a burden and potential threat to several of her neighbors, including multiple children as young as 3 years old, authorities allege.

Lenore Arce, 70, faces charges that include five-counts of first-degree hate crime/harassment, three counts of endangering the welfare of a child, five counts of third-degree stalking and five-counts of fourth-degree stalking.

Racial epithets hurled at neighbors over the course of several months included white trash, n*****, and ch***, while in some cases she followed the victims around their property, the criminal complaint alleges.

Arce, whose first name is also spelled as Leonore in court documents, was arraigned on the charges Friday in Criminal Court in St. George, where a judge released her on her own recognizance.

A temporary order of protection was issued on behalf of the alleged victims, with a following court date scheduled for Nov. 6.

NEIGHBORS ALLEGEDLY BERATED, THREATENED

Arce continuously harassed five households on her Meiers Corners block from Jan. 1 to June 30, in some cases following neighbors around their properties and making remarks based on their race and sexual orientation, the complaint alleges.

One of her targets on multiple occasions was a grandparent and their grandchild, at one point issuing a threat: Im coming for you, you and your white trash family, authorities allege.

The complaint alleges Arce harassed another family, including two children ages 10 and 12, with verbal assaults including, F*** you, you illegal ch***.

Another neighbor was allegedly called a thief and a fa****.

The Advance/SILive.com first reported on the situation in July, publishing disturbing video where she could be heard uttering a stream of racial epithets at a neighbor.

Youre a f****** sick negro ... Put it up your f****** n****** a**, the woman can be heard saying in one video. Youre f****** black trash.

You dont run this f****** neighborhood, n*****, she said in another.

Arce has been a resident of the block for approximately 20 years, neighbors said.

Interviews with a half-dozen residents, some of whom requested anonymity for fear of retaliation from Arce, presented corroborating accounts of residents who said the womans constant harassment affects their everyday lives even causing her neighbors to change their daily routines to avoid coming into contact with her.

I got to look out my window before I come out, said one neighbor who wished to not be named. If I see her outside, I wont go out. But as soon as you step out of your house, she comes running out.

Joshua Benjamin, Arces defense attorney, described the case as a neighbor dispute and said it does not belong in Criminal Court.

Ms. Arce is 70 years old and on a fixed income, he said. She has never been in trouble with the law. She has the absolute legal right to speak her mind. Speech, even speech we dont like, is protected by both Article 1 Section 8 of the New York Constitution and by the First Amendment to the United States Constitution.

He continued: They can only make a hate speech charge if there is an underlying crime. There is no underlying crime. They are trying to penalize and criminalize a New Yorker for having a big mouth. That is against our laws and the beautiful New York value of speaking your mind.

DE BLASIO CALLS FOR INVESTIGATION

In late July, Mayor Bill de Blasio called a video documenting the racist tirades Arce hurled toward her neighbor shameful and disgusting and vowed an investigation would take place.

These are not New York values, and not what this city represents. Were investigating this, de Blasio said at the time.

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Temporary order of protection issued against Meiers Corners woman in hate-crimes case - SILive.com

Bill Whitaker: Protesters lost control of their message in summer of chaos – Waco Tribune-Herald

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German, who added that more than 800 acts of police violence against protesters nationwide have been captured on video since Floyds death on Memorial Day, made a compelling point about the questionable display of apparently undisciplined federal forces in Portland, noting that studies of civil disturbances in the 1960s and 70s showed that aggressive law enforcement tactics were often a determinant factor in instigating and escalating and spreading violence a point embraced by local police departments across the nation (including Wacos) who now coach their officers on how to de-escalate tense situations. Ironically, this point was lost in the parliamentary and partisan charade on ugly display during Tuesdays Senate subcommittee hearing.

Can we find a way forward?Is it too late for a do-over, maybe with a little more John Lewis and Mahatma Gandhi, a little less Sun Tzu and the Great Ahmed Khan? Probably, which makes the death of George Floyd even more tragic given the resulting legislative inaction (well, except for a stubborn effort to make Juneteenth a national holiday, as if this will atone for racial injustice). Perhaps its to be expected of any genuine grassroots movement. As some of us saw with the tea party a decade ago, little time passes before such movements are overtaken, whether by corporate interests, political manipulators or out-and-out renegades whose agendas and motives are never quite so pure. Perhaps, too, the young and idealistic souls who spilled out into Americas streets this summer succumbed to the same impulses seasoned voters do when we send one lawmaker after another to Washington and Austin to fight tooth and nail for us, and to never compromise, rather than pursuing real conciliation, lasting solutions and a dynamic way forward.

Bill Whitaker is Trib opinion editor.

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Bill Whitaker: Protesters lost control of their message in summer of chaos - Waco Tribune-Herald

US Army and Navy unban Twitch commenter who criticized the military – Yahoo Tech

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The US Army and Navy have agreed to unban Jordan Uhl, the activist who linked to a Wikipedia page listing US military war crimes in their Twitch chats. After the incident, Uhl wrote an article criticizing the military for using Twitch to scout for potential recruits, especially since recruiters can interact with kids as young as 13.

In a letter sent to Columbia Universitys Knight First Amendment Institute, which represented Uhl, the Navy justified his ban by pointing out that he violated the channels spam policy when he kept posting similar messages over a period of three days. The Navy agreed, however, that it needs to post comprehensive rules on its page to ensure its viewers are aware of them. It has already posted its policies under its About section and has unbanned Uhl and all other previously banned users as a gesture of good faith.

The Armys letter was much shorter, merely telling the Knight Institute that it has approved its request to unban Uhl. It previously told Vice, however, that its reinstating access for accounts previously banned for harassing and degrading behavior on its Twitch stream. The Army is also returning to the platform after pausing its streaming activities following Uhls ban, which generated a lot of criticism from First Amendment groups. It told Vice that its now reviewing and clarifying its policies and procedures for the stream.

While neither military branch mentioned the reason for the other users ban, the Knight Institute said in a statement that they were prohibited from posting in chat for engaging in core political speech. The institutes whole statement reads:

Were pleased that both the Army and Navy have agreed to unban users who were banned for engaging in core political speech. Its also good to see that the Navy is committing not to ban users on the basis of viewpoint. Of course, it matters how these new policies are applied. We will monitor the Navys practices closely to ensure that the new policies are enforced consistently and in a viewpoint-neutral manner. We look forward to reviewing the Armys policies once they are posted.

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US Army and Navy unban Twitch commenter who criticized the military - Yahoo Tech

"Artificial Intelligence Will Make Medicine Better in the Long Run" – Biophotonics.World

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Image source: Leibniz IPHT

By: Sven Dring

Leibniz IPHT is increasingly focusing on artificial intelligence and learning systems. Thomas Bocklitz is heading the new research department "Photonic Data Science". We asked him how AI could help shape the future of diagnostics

What new possibilities does Photonic Data Science open up for diagnostics?

Photonic Data Science is a potpourri combining mathematical and statistical methods with algorithms and domain knowledge to translate measurement data into useful information. We usually translate photonic data into biomedical for example diagnostic information. By translating with the computer, robust diagnostic information can be extracted. Tiny details in complex data can be made useful for diagnostics. This opens up new possibilities for diagnostics.

Artificial intelligence (AI) then helps to evaluate this data. Which technologies researched at the institute are based on AI?

In the laser-based rapid test of infectious pathogens, machine learning methods and algorithms for data pre-treatment are used to translate Raman spectra of bacteria into a resistance prediction i.e. to predict pathogens and antibiotic resistances on the basis of the spectroscopically recorded data. For the compact microscope Medicars we use deep and machine learning techniques to translate multimodal image data into a tissue prediction for the detection of tumor margins. In smartphone microscopy, which is being researched by Rainer Heintzmann's team, image enhancement is achieved by means of deep learning procedures.

Where do the data sets come from that are currently mainly used? Can they be applied equally to all patients?

The data sets are generated within clinical studies, which we supervise from the beginning. The studies are still too small to exclude a gender bias, but we are working on the experimental design so that there is no gender bias in the training data set and we hope that the models will not generate any bias.

Does the automated analysis of medical control data also carry a risk? A loss of control?

Of course, every technology has risks, although these are manageable here. Artificial intelligence or machine learning processes only work well if the new test data is similar to the training data. We try to tackle this problem by creating the necessary similarity through standardization and model transfer in order to im- prove the predictions. There is a loss of control when the models are applied fully automatically. But in the medium term the models will only represent a second opinion, so there will be no loss of control.

Can physicians improve the learning systems? Is the procedure of AI applications comprehensible for them?

Physicians can increase the database or reduce the uncertainty of the metadata i.e. labels by pooling or voting, which leads to better models. The traceability of AI models is a major topic in current machine learning research Keyword "Explainable AI". The aim is to decipher these models in order to make it clearly understandable how mass-based learning methods and deep learning systems achieve their results.

Can AI be perfected to the point where it can eventually make better diagnoses than a human?

I think so, if the data is highly standardized. Another challenge is to demonstrate that improvement. This requires quite long clinical trials and is ethically problematic.

Could AI ever replace doctors instead of just to supporting them? For example, could operations be performed by AI-controlled robots at some point?

I don't think so, because there are many uncertainties in an operation that must be reacted to flexibly. This is not a prominent feature of current AI procedures. It's more likely that the surgical robots will do very specific things directly on the operator's instructions.

Will AI make medicine better?

In the long run, I think so. But first, it will make diagnostics more comparable and it will also allow data to be used not only sequentially, but in combination.

Artificial Intelligence, Machine Learning, Deep Learning

Decision making, problem solving, learning these are actions that we commonly associate with human thinking. We call their automation artificial intelligence (AI). An important part of AI is machine learning (ML). Scientists are researching algorithms andstatistical or mathematical methods with which computer systems can solve specific tasks.

For this purpose, machine learning methods construct a statistical-mathematical model from an example data set, the training data. On this basis, ML methods can make predictions or make decisions without having been explicitly programmed for it. ML techniques are used, for example, for spam detection in e-mail accounts, in image processing, and for the analysis of spectroscopic data. Deep learning is a method of machine learning that is similar to the way the human brain processes visual and other stimuli. Artificial neurons receive input, process it and pass it on to other neurons.Starting from a first, visible layer, the characteristics in the subsequent, hidden intermediate layers become increasingly abstract. The result is output in the last, again visible layer.

Making Tumor Tissue Visible with AI

Did the surgeon remove the entire tumor during surgery? In order to find out, researchers are combining optical methods with artificial intelligence (AI) and data pre-processing methods. AI is behind the compact Medicars microscope, for example, which enables rapid cancer diagnosis during surgery. Here, patterns and molecular details of a tissue sample irradiated with laser light are automatically evaluated and translated into classical images of standard diagnostics. Thus, tumor margins become visible.

"For this purpose, we train AI algorithms together with pathologists," explains Thomas Bocklitz. We take multimodal images of a tissue sample with our laser-based multi- modal microscope. In pathology, the tissue section is then embedded, stained, and an image of the HE- stained tissue section is taken (HE = haematoxylin-eosin). This enables the pathologist to recognize tumor tissue. Then we put the multimodal and the HE image side by side."

Based on the pathologist's analysis of the tissue structure and morphology, the research team teaches the algorithm which tissue is healthy and which is sick. "In this supervised approach, the algorithm learns to distinguish successive, healthy and diseased areas." With success: The accuracy of the predictions is more than 90 percent according to tests on a small group of patients.

Source: Leibniz IPHT

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"Artificial Intelligence Will Make Medicine Better in the Long Run" - Biophotonics.World

Morphisec Knowledge Update: New WastedLocker Ransomware Causes Havoc Among Some of the Leading Enterprises in the U.S. – Security Boulevard

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Garmin has confirmed that the recent outage its users experienced was indeed the result of a successful ransomware attack. However, the extent of the damage done is still unclear. The attack, which compromised Garmins servers for five days, impacted millions of users globally and will likely end up costing Garmin millions of dollars in lost productivity and reputation alone. While Garmin says that no customer data was leaked, Garmins call centers, web site, and cloud-based services such as Garmin Connect and FlyGarmin (a commercial aviation navigation service) were either taken offline or negatively impacted as a result of the attack.

According to reliable sources, the Garmin attack appears to have been the result of a successful WastedLocker ransomware infiltration by the notorious Russian cybercrime group known as Evil Corp. The groups apparent success in this recent attack highlights the danger of organized threat actors to companies of all sizes. It also provides a lesson for companies seeking to protect their corporate networks against similar threats. The first step towards improving your own network security is understanding how Garmin fell victim to this attack.

The type of attack chain that Garmin witnessed is likely no different from those experienced by other victims of Evil Corp malware breaches. Like their previous Bitpaymer attacks, Evil Corp spread WastedLocker malware payloads by masquerading them as software or system updates. These malicious updates are delivered via a Javascript-based framework known as SocGholish, which, running under the privileges of a browser user, lures targets into downloading fake updates to applications such as Chrome and Firefox web browsers. Evil Corp has previously used a similar framework to trick targeted users into downloading Dridex malware, Cobalt Strike beacons, Netwire, and more.

While attacks conducted by Evil Corp are often tailored explicitly towards targeted organizations, they tend to follow a similar attack chain:

After its execution, WastedLocker will attempt to encrypt all the files it can access within the infected target network while deleting shadow files and backups. Ignoring files with a size of fewer than 10 bytes, Wastedlocker encrypts victims files in batches of 64mb with the AES algorithm. The encrypted filenames are also renamed to include the victims name alongside the string wasted, i.e., file.doc.companynamewasted. The service also creates a separate ransom note which appears alongside each file, i.e., file.doc.companynamewasted_info.

After this process, the encryption service itself is deleted and a log file of encrypted files created. In return for unlocking the files, Evil Corp demands, through a specified email address, a ransom payable in Bitcoin. Most Evil Corp ransom demands range between $500,000 and $10 million.

The pathways that Evil Corp targets might not be immediately recognizable as significant assets. They often look for higher-value targets like file servers and database services alongside lower-value targets like virtual machines and physical workstations that could turn into high-value targets if used for lateral movement.

Evil Corp gains a foothold in these vulnerable endpoints by exploiting a critical weakness in many companies cybersecurity posture memory. Despite breached companies possessing EDR and AV security tools, EvilCorp has consistently demonstrated a capacity to bypass many advanced endpoint protection and antivirus methods with its full attack chain.

For organizations faced with highly sophisticated and targeted attacks from well-resourced cybercrime gangs like Evil Corp, standard AV and EDR platforms are of little use. While siloed backups can provide mitigation in case of a successful attack, targeted ransomware like WastedLocker usually aim to knock out backups as a key attack priority.

However, its still possible to protect corporate networks from these kinds of sophisticated attacks. A proactive cyber defense strategy prevents WastedLocker and other advanced ransomware attacks from progressing by preemptively detecting it and stopping its payload being delivered. With a dedicated memory defense layer, attacks never have a chance to infiltrate a targeted network in the first place. The Proactive Endpoint Protection solutions offered by Morphicsec protect corporate networks against zero-day and unknown attacks without needing any rules, signatures, or any other type of prior knowledge.

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Morphisec Knowledge Update: New WastedLocker Ransomware Causes Havoc Among Some of the Leading Enterprises in the U.S. - Security Boulevard

BREAKING: New York Judge Requests Testimony from Julian …

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A New York magistrat judge is requesting testimony from Wikileaks founder Julian Assange in a case involving slain DNC voter data director Seth Rich.

U.S. Magistrate Judge Sarah Netburn requested the international assistance in order to get the testimony.

The parents of Seth Rich are suing FOX News and Judge Netburn wants Assange to testify on Seths role in the leaked DNC documents.

Julian Assange has repeatedly said the documents did not come from Russia. And Robert Mueller interviewed hundreds of witnesses in his anti-Trump witch hunt but never got around to questioning Julian Assange who was the source of leaked DNC documents.

The parents of Seth Rich believe he had nothing to do with the leaked documents to Wikileaks.They may not like what they find out.

TRENDING: EXCLUSIVE: Killer Cuomo Not Only Murdered Thousands of Elderly In Homes, He Also Targeted Adult Care Facilities and Group Homes for People with Disabilities

On November 9, 2016 Ellen Ratner admitted publicly that she met with Julian Assange for three hours the Saturday before the 2016 election. According to Ratner, Julian Assange told her the leaks were not from the Russians, they were from an internal source from the Hillary Campaign.

Rich was murdered before the election in 2016 late at night in Washington DC.

The Epoch Times reported:

A federal magistrate judge in New York requested assistance from a UK court on Aug. 5 in obtaining testimony from WikiLeaks founder Julian Assange for a U.S. civil lawsuit brought against Fox News and others by the parents of slain Democratic National Committee voter data director Seth Rich.

U.S. Magistrate Judge Sarah Netburn requested the international assistance in accordance with the Hague Convention.

In the proper exercise of its authority, this court has determined that the evidence cannot be secured except by the intervention of the English courts and that assistance from the English courts would serve to further the international interests of justice and judicial cooperation, the judge wrote in a memorandum for the senior master of the Royal Courts of Justice.

Joel and Mary Rich, Seth Richs parents, sued Fox News in March 2018 nearly a year after the news network published and retracted an article titled Seth Rich, slain DNC staffer, had contact with WikiLeaks, say multiple sources. The Riches claimed the network inflicted intentional emotional distress on them by slandering their son. The case was dismissed in August 2018, but the Second Circuit Court of Appeals overturned the dismissal more than a year later.

The case has since entered the discovery phase and the judge determined that Assanges testimony is crucial for determining the central dispute between the partieswhether the article was a sham as the Riches claim, or substantially true as maintained by Fox News.

Mr. Assange, as founder of WikiLeaks, is exceptionally suited to provide testimony that will be highly relevant to these issues. Therefore, Fox News, by and through this letter of request issued by the District Court, is formally requesting the testimony of Mr. Assange for use at trial, the request to the UK court states.

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BREAKING: New York Judge Requests Testimony from Julian ...

Detailed examination of the Quantum Cryptography Services Market to hold a high potential for growth by 2027 – The Daily Chronicle

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Stratagem Market Insights has released the latest research report on Global Quantum Cryptography Services Market. This Quantum Cryptography Services industry report provides information related to market size, production, CAGR, gross margin, growth rate, emerging trends, price, and other important factors. Focusing on the key momentum and restraining factors in this market, the report also provides a complete study of future trends and developments in the market.

The Quantum Cryptography Services report contains all the details of the expected market dynamics and new market opportunities due to the COVID-19 outbreak. Stratagem Market Insights tried to cover all the market analysis of annual economic growth in the latest report on the Quantum Cryptography Services market.

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According to analysts, the growth of the Quantum Cryptography Services market will have a positive impact on the global platform and will witness gradual growth over the next few years. This report study incorporates all the market growth and restraining factors along with the important trends mentioned between 2020 and 2027.

Competitive Landscape

This section of the report identifies various major manufacturers in the market. It helps readers understand the strategies and collaborations players are focusing on fighting competition in the marketplace. The comprehensive report gives a microscopic view of the market. The reader can identify the manufacturers footprint by knowing about the manufacturers global revenue, the manufacturers global price, and the manufacturers production during the forecast period.

The major manufacturers covered in this report:

(MagiQ Technologies, Quantum XC, Qubitekk, QuintessenceLabs, NuCrypt, Qasky, Crypta Labs)

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The Quantum Cryptography Services market has been segmented into a variety of essential industries including applications, types, and regions. In the report, each market segment is studied extensively, taking into account market acceptance, value, demand, and growth prospects. Segmentation analysis allows customers to customize their marketing approach to make better orders for each segment and identify the most potential customers.

Lucrative opportunities:

This report examines the challenges facing the global metallurgical complex, as the study listed them all. This made it possible to understand the market and take advantage of all the lucrative opportunities available. The researchers provided a comprehensive study of the current market scenario while focusing on new business goals. There is a comprehensive analysis of the changing customer requirements, customer preferences, and supplier landscape of the overall market.

Regional Insights ofQuantum Cryptography ServicesMarket

In terms of geography, this research report covers almost all major regions around the world such asNorth America, Europe, South America, Middle East, Africa, and the Asia Pacific.Europe and North America are expected to increase over the next few years. Quantum Cryptography Services markets in the Asia-Pacific region are expected to experience significant growth during the forecast period. Advanced technology and innovation are the most important characteristics of North America and the main reason why the United States dominates the world market. The Quantum Cryptography Services market in South America is also expected to expand in the near future.

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The research and analysis conducted for the Quantum Cryptography Services market have focused on emerging market trends. Research analysts have provided clients with actionable insights to help them identify market opportunities and plan and develop effective strategies to optimize their market position accordingly.

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Detailed examination of the Quantum Cryptography Services Market to hold a high potential for growth by 2027 - The Daily Chronicle

How the Army Is Really Using AI – AI Daily

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It has always been controversial for the army to implement artificial Intelligence within their task force (particularly with the use of drones) because ethics of it, however artificial intelligence is being implemented within the army in other less controversial ways forget the movie Terminator, artificial intelligence is performing many tedious and manual tasks that would use a lot of time and resources and providing assistance to recognition and conversation systems to predictive analytics pattern matching and autonomous systems.

The army leverage artificial intelligence by (for a more detail example) predicting when vehicle parts may need to be replaced which saves a lot of time, money and increase operational safety. Some programs that leverage data using machine learning include Project Maven that retrieves data from drones and aids to automate some of the work that analysts do again saving time and money. As you can see artificial intelligence is being used to improve the armys efficiency.

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How the Army Is Really Using AI - AI Daily

Cryptocurrency Cards: An Unnecessary Solution That Should Be Stopped – Cointelegraph

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Crypto cards have become a must-have for many crypto services. Hoping to reduce the risk of blocking transactions, companies have been looking again and again for reason why their customers should use plastic. But a crypto card is a placebo that does not solve the problems of either users or fintech companies its only goal is to bring profit to payment systems and intermediaries.

Crypto cards are not needed in the same way that special financial instruments are not needed to buy gold, oil, precious metals or any other resource. The word cryptocurrency like dollar or euro indicates only the currency for transactions with which the card can be used and does not make the banking product any more innovative. However, until banks and payment systems recognize this, we will be forced to eliminate the consequences of cooperation with Wirecard, WaveCrest and other processors that arent the most conscientious, wanting to make money by taking risks but without being able to manage them.

Bank card technologies have gone through a rapid evolutionary path in a very short period of time. They are the fundamental and connecting element for all retail trade relationships. According to Nilson Report, there are currently more than 22 billion payment cards in circulation around the world debit, credit and prepaid. Taking into account that 1.7 billion people do not use banking services at all, for each of the remaining 6 billion people, there are on average 3.6 cards.

All cards are serviced by payment systems that create a closed consumption ecosystem. Heres what happens:

Banks and processor companies pay Visa, Mastercard, UnionPay, American Express and other international payment systems for the possibility of issuing cards.

Cardholders pay banks an annual fee or transaction fees.

Sellers transfer to banks on average 1%4% of the transaction amount for acquiring servicing.

Various intermediaries, aggregators, API providers, etc. also collect a commission.

The main thing is that in each commission payment between all participants, a share of Visa, Mastercard or another payment system is included. If we are talking about cryptocurrency transactions, then the commission of payment systems will be higher, since the traditional financial industry regards these transactions as high-risk.

And yet, bank cards are almost indispensable for transactions worth up to $5,000. This is the fastest and most convenient way to buy crypto from numerous wallets and/or exchanges. Therefore, it would be naive to think that fintech companies could quickly get rid of the intermediation of payment systems and stop paying them for every transaction.

Nevertheless, Visa and Mastercard can do a lot to make their native cards much friendlier to crypto and become a part of the solution, not part of the problem, which Wirecard has been trying to get around, making this kind of change seem inevitable.

Today, when the volume of non-cash payments in many countries has surpassed cash payments, any company wanting to issue bank cards under its own brand, in theory, has three options.

1. Become a principal (direct) participant in the international system. To do this, you need to meet a number of mandatory criteria: have the necessary technological platform and qualified personnel, meet information security requirements, provide security funds, etc.

For example, last year, a principal Visa participant had to have capital of at least $56 million directly with the Visa payment system. Therefore, you need to have an account in United States dollars in the U.S. or in euro in the European Union. The licensing procedure itself can cost about $1 million, excluding the funds required for the security deposit and direct royalties. This is not a realistic option for small and medium fintech companies.

2. Become an associated member of the payment system through the sponsoring bank. In this case, it is the bank that takes care of the compliance with the payment system requirements. The license fee is $200,000$300,000, plus a deposit of several million dollars.

However, even under such conditions, financial organizations do not want to directly cooperate with crypto companies since transactions with cryptocurrency are classified by payment systems as high-risk due to the lack of a unified approach to regulating this area. This results in higher fees and chargebacks for transactions that have been challenged by the cardholder.

3. Contact a processing company. Unlike banks, processors are responsible for issuing payment cards. Among such processors, crypto services usually find partners with a high-risk appetite that are willing to cooperate. Such companies are ready to use various tricks so that payments passing through them are not blocked by the payment system. For example:

Conceal or falsify before the payment system the main activity of the company for which the issue occurs.

Use incorrect Merchant Category Codes.

Issue crypto cards on their own Bank Identification Number, while according to the rules of payment systems, a separate BIN must be allocated for each individual product.

Issue co-branded cryptocurrency cards, which are, in fact, bank cards with an individual design and are then sold through a crypto service.

Expand the limits of card transactions, regardless of the requirements of payment systems and/or the regulator, etc.

All of these are often unjustified risks that processors like Wirecard take on, increasing the cost of issuing and maintaining crypto cards for both crypto services and end-users. Meanwhile, the value of these crypto cards continues to depreciate.

Until recently, people were forced to buy a fourth or even fifth payment card, only for the sake of the crypto prefix in order to save their money from being blocked during operations with cryptocurrency. However, regulated crypto services have already learned to tackle this problem differently by acting strictly within the framework of compliance requirements and forging links with traditional financial institutions.

High-risk processors like Wirecard or Wavecrest can be compared to microfinance institutions, or MFIs, that lend out at huge interest rates. Usually, people turn to MFIs after numerous and not always objective refusals by banks to issue a loan. Sometimes, the money is needed urgently, and the consideration of the application in the bank is delayed; sometimes the banks scoring system does not like the place of work, marital status or the gender of a person. There may be many reasons, but the result is the same: The bank does not want to take risks and people go to less discerning financial intermediaries. Crypto services are forced to do this, too.

A cryptocurrency card is a ridiculous, temporary and forced necessity because banks and payment systems do not want to manage risks on their own. All the risks that Wirecard once assumed when working with crypto companies are now easily eliminated.

Licensing of activities in the field of cryptocurrencies, the implementation of KYC/AML procedures, obtaining a compliance certificate of the payment card industry data security standards and other measures allow crypto services to successfully work with the traditional financial system.

Banks should have the courage to start making money by partnering with regulated crypto services. And for this, above all else, it is necessary to develop internal expertise in the field of compliance. As bank employees have had little motivation to deal with the peculiarities of high-risk transactions, it is easier for them to refuse service to potential clients and/or stop transactions.

However, if a banks compliance service monitors and skips high-risk transactions on a regular and systematic basis, this will create additional cash flow, from which banks could also receive commissions. I am sure that cryptocurrency users right to dispose of honestly received assets should be ensured in an absolutely transparent, legal way, and not by gray schemes. Any card can be crypto, and this is the reality we should all be living in sooner rather than later.

The views, thoughts and opinions expressed here are the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Alex Axelrod is the founder and CEO of Aximetria and Pay Reverse. He is also a serial entrepreneur with over a decade of experience in leading world-class technological roles within a large, number-one national mobile operator and leading financial organizations. Prior to these roles, he was the director of big data at the research and development center of JSFC AFK Systems.

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Cryptocurrency Cards: An Unnecessary Solution That Should Be Stopped - Cointelegraph