Is now the time to invest in blockchain and bitcoin - top investors
Date: 27 November 2018
Tim Draper is a billionaire investor and Patrick Byrne is CEO of Overstock.com (OSTK), an online retail venture. Both have been strong supporters of cryptocurrencies and blockchain.
In a recent interview screened on Fox Business, Byrne has re-iterated this support and dismissed concerns about the current crash as investors not seeing the wood for the trees. He quipped that “What coins are doing on any given day is silly”.
According to him, the blockchain revolution is bigger than anything we have seen in history. It is bigger than the internet and will transform the world. He predicts that 2019 will see the launching of multiple use-cases and products for blockchain.
He spent some time talking about the emergence of a whole new class of securities, through the trading of security coins. He recalled the comment from Robert Greifeld, the chairman of Nasdaq, in November 2017, that every stock and bond on Wall Street “could” be tokenized. In Byrne’s view, “In five years every one will be tokenized”. He predicts that Wall Street as we know it will change, and he seems to have been part of building the digital infrastructure to replace it.
According to him, tokens are superior to the current Wall Street approach because there is 90% lower friction cost, there is complete transparency for regulators and market manipulation will not be possible.
Byrne says that he has invested in 19 different blockchain-based businesses. One of them is Ravencoin. According to the Ravencoin website, this is a blockchain optimized to transfer assets such as tokens from one holder to another. Another is Minds, where he has invested $6 million. This is a blockchain-based alternative to Facebook, Twitter and YouTube.
The billionaire Tim Draper has previously predicted that the Bitcoin price will reach $250,000 by 2022. He re-iterated it in September of this year. His view of any dip in price is that it is simply an opportunity to buy. He has been very accurate in previous predictions about the Bitcoin price, so his view might be worth listening to.
Proof of his belief in the currency is that after surviving a loss of $250,000 in the 2014 Mt Gox exchange hack he then went on to purchase 40,000 BTC later in the same year. He has apparently not sold any of them. He is not concerned about hacks in the crypto world. According to him, the bitcoin blockchain has never been hacked. “In fact, I am more confident in my bitcoin than I am in the U.S. dollars in Wells Fargo, ” he says
He believes that one of the major benefits of cryptocurrencies is that they are frictionless and cheap to use. This is why people will move away from fiat currencies and why small countries will want bitcoin, ICOs and blockchain.
Draper, like Byrne, believes that blockchain is bigger than the internet and will revolutionize the world. He is a previous investor in Tesla, Hotmail, and Skype, but says that blockchain will be bigger than all of them combined.
Maybe those of us who are currently very nervous about what is happening in the cryptocurrency world may take heart in hearing the long-term confidence being expressed by those who have been prepared to invest large of their own money into it.
Will the move to cashless societies lead to adoption of cryptocurrencies?
Date: 27 November 2018
Billionaire investor Tim Draper has predicted that small countries will increasingly move towards cryptocurrencies. In the light of this, it is interesting to consider what is happening in Sweden right now.
Sweden is moving quickly towards a cashless society. The central bank is testing a digital currency called the e-krona, and half of the country’s 1,400 banks no longer accept cash deposits. The prediction is that half of the country’s retailers will stop accepting cash by 2025.
According to a New York Times report, a fifth of Sweden’s 10 million population don’t use ATMs any more. Only about 1 in 10 people paid for something in cash during 2018, compared to 40% in 2010. Among 18 – 24-year-olds, the figure is 5%. Ikea, makers of popular flat-box furniture, found that only 1% of their customers were paying in cash, but handling of this cash was taking up 15% of employees’ time. So they are experimenting with completely cashless stores – and giving away items from their coffee shop which was eventually the only place where people tried to use small amounts of cash.
More than 4,000 people in the country have implanted microchips in their hands to pay for goods or enter keyless offices by waving their hands.
The financial authorities are scrambling to work out what this will mean for the country and how they should somehow still remain in control of the country’s money supply. According to the governor of the central bank, the Riksbank:
“When you are where we are, it would be wrong to sit back with our arms crossed, doing nothing, and then just take note of the fact that cash has disappeared. You can’t turn back time, but you do have to find a way to deal with change.”
The trend in Sweden is also visible in Asia, and especially in Japan, South Korea and China. There is increasing reliance on mobile applications such as AliPay to pay for necessities and even to receive salaries. Alongside this move, there has also been a move in these countries towards cryptocurrencies. Japan and South Korea have become the second and third largest cryptocurrency markets in the world, after the USA.
The question now is whether Sweden also will follow this trend to cryptocurrencies.
Sweden could become a prime market for cryptocurrency users and investors if this is supported by government and by favourable regulations.
Blockvest wins round two against SEC
Date: 28 November 2018
After all the negative news about the SEC banning and fining ICOs, this week’s court ruling about Blockvest is a bit of a breather for ICOs.
The U.S. Securities and Exchange Commission (SEC) in October 2018 obtained an emergency court order against the Blockvest ICO on the grounds that it had fraudulently claimed that it had approval from the SEC and a fictitious regulatory agency named “Blockchain Exchange Commission” (BEC) and that it had not registered with the SEC as required for a security.
In a court finding this week, a judge declared that the Blockvest ICO either was not a security – and therefore did not need to meet to meet the SEC regulations - or that the SEC had not provided sufficient evidence that it was a security.
The judgement hinged on the definition in the Howey test that investors may have expected to earn a profit based on the efforts of others. The finding was that the marketing and sales of the tokens did not make inappropriate promises in this regard. In addition, it seems that the BEC does exist, although it is not an official government agency.
There were only 32 investors in the ICO, most of them friends and family of the defendant, and the claims they had made about how much had been raised may have been overly optimistic, but not necessarily illegal.
There may be a next round to this dispute and the SEC may win it, because Blockvest did not register with the SEC as required. However, in a week of crypto and ICO bashing this was a bit of a welcome relief.