The biggest innovation wave we'll see in our careers & the Killer App of Blockchain
Matthias Knab
Founder of Opalesque (2003), leading alternative investments/family offices publisher. Senior Advisor to Castle Hall (operational due diligence, $10T AuM). Creator of Fundmanager.tools, a proven system for asset raising.
We've just published our inaugural Cryptocurrency & Blockchain Roundtable - download here for free: https://www.opalesque.com/RT/cryptoblockchainroundtableny2018.html
Given the accelerating process of digitization - also of assets - it's fair to ask if in 50 or 100 years will we still use a paper dollar or euro? Are cryptocurrencies the "killer app" of Blockchain and the future of money? But until now, there are more questions than answers...
The cryptocurrency and Blockchain space is a very specific technology-driven ecosystem. Just look and find out who has studied the original Satoshi white paper - but by now, more investors are taking heed. For example, 75% of the first $100m of tZERO's security token offering went to institutional players.
The Scourge of Inflation
Do you remember the poor guy who bought the two pizzas with 10,000 Bitcoin in 2010? He could now buy two G5s... That's sad for him, but what's probably sad for a lot more people is that if you had put $10,000 of cash in your bank account in 2010, it is today worth just $8,400 thanks to the devaluation of fiat currency.
There have been roughly 875 paper currencies in the history of the world, and three quarters of them don't exist today in any form. Throughout history, there has never been a single case or example where inflation did not happen.
"I am talking not only about places like Venezuela and Zimbabwe. This is, and has been, happening right where we are today in New York. Just a couple of blocks north of here you can find a restaurant called "The Oyster Bar," which was one of hundreds of oyster bars in New York City over 100 years ago. You could get the following deal: For five cents, you got all the oysters you wanted, and all the beer you could drink. If today you can find that for 100 bucks in New York City today you can call yourself very lucky. So, in real oyster terms even the U.S. dollar has devalued by 99.95%," says Roy Niederhoffer, adding cryptocurrency are a solution to this problem of overprinting by governments.
The biggest innovation wave we will see in our careers
Blockchain in itself is not a disruptive but more a foundational technology, and so it will be the applications that are going to be built upon the Blockchain that are going to be disruptive. We'll see the change from analog, physical paper ownership to the true and full digital ownership of assets. Everything of value can be tokenized with Security Tokens.
"Just as a few technologies that emerged from the dot-com era have transformed our lives, the crypto-assets that survive could have a significant impact on how we save, invest and pay our bills," says Christine Largarde. There will be completely new models and efficiency plays. We also see how ICOs are changing the whole asset raising mechanisms for start ups and as well as for established companies, and getting into competition with traditional venture capital.
The #1 Advice: Spend the time!
"There is a perfect inverse correlation between the affection for, affinity toward, and hatred for cryptocurrency and Blockchain technology and the amount of time spent. So, people who spent zero time typically hate it, or are afraid of it, don't want to talk about it. I haven't met anyone who has not started skeptical, so I think is the typical human reaction, but who then has spent time on it and has come away more excited", says Mark Yusko.
The following experts participated in the inaugural Opalesque Cryptocurrency and Blockchain New York Roundtable, sponsored by Cohen & Co.:
- Mark W. Yusko, Founder, CEO and CIO, Morgan Creek Capital Management
- Joe Cammarata, President, tZero
- Roy Niederhoffer, President, R.G. Niederhoffer
- Michael Moro, CEO, Genesis Trading
- Kenneth Goodman, Co-Founder, Altcoin Advisors
- Steven Baum, Co-Founder and Chief Operating Officer, IronChain Capital
- Marcelo Garcia, Founder, Crypto Explorers
- Will Coleman, Director of Technology Advisory Services, Cohen & Co.
The group also discussed:
- Are all cryptocurrencies deflationary, or are there also some inflationary ones? (page 8)
- How "hard" is the limit of "21 million" as the maximum number of Bitcoins that can be mined? Do "Forks" have inflationary effects? What have we learned from past Forks? (page 9)
- Why is network size (Metcalfe's law) in favor of Bitcoin? (page 9)
- The role of derivatives: The ingredients that bring lower volatility to cryptocurrencies are already in place. Bitcoin not more volatile than the stock market 10 years ago (page 10)
- Are there differences between cryptocurrency and a digital currency? (page 14)
- Is a stable Bitcoin necessarily a good thing for Bitcoin? (page 11)
- If Bitcoin is trackable, why is it that hacking and the theft of Bitcoin are such issues then? (page 12)
- How does Bitcoin compare to gold? (page 13, 15)
- Will the Swiss outdo everyone else when it comes to crypto? (page 14, 28)
- Bitcoin as a Relative Value Play (page 15) and relatively cheap option on an asset with an asymmetric return profile. Why starting with even $100 makes sense (page 16, 36)
- Yield curve, lending, custody, ETFs, Sidechains: What's coming next for Bitcoin (page 17, 26, 31). Non-store of value use cases (page 32)
- Understanding the Gartner Hype Cycle phenomenon. When will we see a full adoption of Blockchain technology and cryptocurrency? (page 19)
- What is the best way to transact large Bitcoin volumes? (page 16)
- What is Blockchain capable of doing within a business organization? (page 21) Minimizing entropy (page 31-32)
- Why are security tokens different from "coins"? (page 22)
- When and where was the execution, clearing and settlement of the first trade of a security token on the Blockchain? (page 22-23)
- Regulation (including tax policies) are wanted and needed, but how will they look like? (page 22-30, 35, 39). Will security tokens will be covered under SIPC rules? (page 30)
- How to deal with conflicts that arise from having both equity and token investors? (page 30-31)
- Should people be concerned about Tether Limited? (page 33)
- What should you expect getting into the Crypto space these days? (page 34)
- How to evaluate an ICO / token offering. Why the likelihood of Bitcoin or Ether going to zero is very small at this point (page 37-39).
Download the PDF here & enjoy: https://www.opalesque.com/RT/cryptoblockchainroundtableny2018.html
Matthias Knab
Investor Relations & Business Development, Capital Formation for Hedge Funds, CTAs, Venture Funds & Alternative Investments, Hedge Fund Manager Selection, ESG
6 年Very informative presentation. Thank you.
CryptoCurrencies are in their early days... just think about what the stock market looked like in the 1920s'... It's just a question of time before derivatives come to the crypto world on a large scale to dampen the volatility. Beside Bitcoin today, you cannot short any crypto, so they are a pure momentum play until no one wants to bid higher and then the only alternative is to sell what you bought as quickly as possible until this extreme bearish move is stopped by fundamental-oriented buyers, and the cycle continues. A good example from the traditional finance is the price movement of stocks that become "un-shortable" (think bank stocks during financial crisis when the regulators want to prevent heavy pushes on the stock by short-sellers...) and guess what? These stocks become "long only toxic stocks" that everyone want to dump as quickly as possible, so the price crashes, but as there is no short sellers, there's nobody to cover their short positions and provide a cushion under the stock... no possible short squeeze, and these stocks eventually become bid-less... So let the crypto currencies market mature, more players coming and more tools to handle them and we'll see a totally different landscape from today.
CERES Coin | Veteran Owned, Multi-Patented Stablecoin and Tokenized Money Market Fund aka a Cointrust
6 年CoolMellon: CERES https://www.businesswire.com/news/home/20180419005906/en/Army-Veterans-Career-Investors-Create-CERES-Coin
Leading advisor to senior Finance and FP&A leaders on creating impact through business partnering | Interim | VP Finance | Business Finance
6 年Simple answer is no because the volatility is too big. You can use a form of payment that swings so much in value that you don’t know how much it’ll buy you the next day.