right place right time

Your daily newsletter for August 16, 2018
About time
"Someone is sitting in the shade today because someone planted a tree a long time ago."
- Warren Buffett
Big time
I'm pretty inspired by the time quotes today – "Life is short and time is swift", as they say, and "procrastination is the thief of time" 😂 Okay, I'm kidding. Anyway, there are all sorts of news these days where regulators and companies are doing the groundwork to enable us to make a blockchain- and crypto-enabled future possible, so I say, "it's only a matter of time" 😉
High time
We saw the total market capitalization falling from ~$212 billion to ~$201 billion earlier in the day before bouncing back to ~$206 billion at time of writing. Overall, total market capitalization remained relatively stagnant from yesterday, which closed at ~$203 billion 🙌

BTC also barely budged (+0.34%) at the ~$6,400 level. ETH continues on its road to recovery today from its recent ~31% decline (~$370 to ~$255) earlier this week, clawing back to ~$290 over the last 2 days 🤙

Today’s most notable coin is ETC which saw a ~17.23% price surge to ~$14, likely due to the Coinbase announcement earlier today that ETC support would be going live on the platform starting at 5pm PT today.

Not the first time 'round
Joseph Lubin, CEO of ConsenSys, said in an interview with Bloomberg that the space has seen six bubbles, which in hindsight look like "pimples on a chart" 😂 He believes bubbles can be positive since they bring attention, entrepreneurs, developers and money to grow value. He cites that we have since seen a 2 orders of magnitude 🔥 increase in developer activity, scalability and technology because of the last bubble.

He goes on to add that he believes that traders are the ones that are driving volatility, but he isn’t concerned that the slump in prices will slow down the development of core infrastructure and adoption. 

Wasn't built in a day
Canadian financial firm BMO Capital Markets is working with the Ontario Teachers’ Pension Plan, a single-profession $189.5 billion pension plan that serves close to 323,000 teachers in Ontario, on a new blockchain venture that will issue CA$250 million 1-year floating rate deposit notes using smart contracts 🌝

The note is issued by the Bank of Montreal 🏦 on an open source blockchain infrastructure. It will stress test the viability of blockchain technology for larger rollouts, and to assess cost savings for future reference.The issuer and the buyer can view the transactions on chain, and verify the accuracy of both payments and term sheet information until maturity date 👀

Runway
One step at a time, Coinbase builds its crypto empire ⚔️ It acquired Distributed Systems today, a five-person San Francisco startup that focused on decentralized identity solutions. Distributed Systems has been working on developing an open identity standard for users on decentralized apps (dApps).

The team members will explore ways to integrate decentralized identity across Coinbase’s services, including its Toshi product. Perhaps we'll see "Log in with Coinbase" soon.

But why give blockchain identity the time of day?
It allows individuals to assume complete control over their digital identities, potentially translating to a higher degree of security 🔑 The current problem with the identity management landscape is that many digital identity copies are being duplicated and stored across various centralized databases, resulting in exposure and hence risk.

By using a blockchain identity system, other than boosting security, users can also control who accesses their data, and they can choose to refuse or monetize its use directly 💰

Long term play
  • American Association of Insurance Services (AAIS) has introduced a blockchain-based insurance database and reporting tool based on Hyperledger Fabric.
  • Reality Shares, an asset management firm who launched the first-ever Chinese blockchain ETF in June, will be launching a $100 million crypto hedge fund.
  • ZB.com, the exchange, will be setting up operations in Malta, following Binance, OKEx and DQR.
Poll of the Day
How positive are you about the possibilities of blockchain identity systems? 🔐
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Can you see it being everywhere? Would you use one? What do you hope for it? Tap a number above and talk to us! 👆
What you said
The support for tokenising national currencies: 5.8 (lol). Even then, 64% of respondents thought it was inevitable that national currencies will tokenize eventually.

I was pretty happy to see a lot of support for an international currency, one which is the world standard 🌍 There was a suggestion for adopting a shared set of currencies, rather than going the old route of national currencies requiring exchange rates. (Of course, I can still hear the echoes of my macroeconomics professor from years ago going: “We need national currencies for fiscal and monetary control policies… every country has different challenges…” 😅 bye, prof) Recall that fractional reserve banking means fiat currency that isn’t actually asset-backed, so the government can print as much money as it wants.

From our friends in the US, the view is that it seems unlikely the USD will tokenize anytime soon due to its position as a reserve currency in the world, which makes it strong in valuation and adoption. It also is a major fiat currency when exchanging with crypto. There were strong concerns about the SEC being cautions and skeptical about cryptocurrencies, so legislation might not catch up as quickly as people would like. The other point of view is that it costs more money to create tangible cash (such as bank notes, pennies, etc), so it should be replaced in favor of cryptocurrencies where citizens can mine for digital currency on their own. Some believe this can factor in monetary and economic policies as well, through playing with levers such as mining difficulty, and giving universal basic income through smart contracts, and more.

Over in Russia, a few of our friends there feel that cryptocurrencies should be free of government intervention, where they prefer the government not put their hands on it. Someone points out that their governmental controls, such as internet censorship, is horrible, and interference in progressive technologies does not end well – he/she adds that we should just leave them to do it to last century tech like TV and newspapers 😂 Some worry that having the government in crypto will lead to unfavorable regulation or downright reversal of progress.

In Southeast Asia, the view from Malaysian and Singaporean friends is generally that there is no need for a digital currency right now, although some point to other countries that might need it to counter hyperinflation, such as Venezuela. Someone from Singapore pointed out that it being a small country serves as a great proof-of-concept for other countries if it does implement it quickly.

Some shorter responses we got include India, where a few mentioned that regulation in the short term will prevent anything from really happening, but there is hope that it eventually will work itself out for tokenization to happen, which can serve social needs. From the UK, some feel that there is higher awareness of crypto so it would work for the country in terms of getting faster/more adoption.

Of course, there are detractors who say it is pointless and provides nothing different from fiat, or that it’s not necessary since there are already systems in place which work.

Overall, the sentiment feels positive that we might get to national cryptocurrencies, it’s just not clear how or when that will happen; and I’m sure there will be way more investigations done to uncover the impact of an entirely crypto-run economy – such as, for example, how do you give crypto to those without connectivity? Or how do you educate people about the security issues of keeping their keys? And so and and so forth… There are so many upsides, of course, and so we’ll all keep pushing for change over time 💪

See you tomorrow!
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