📌 An opinionated recap of the most interesting news in crypto
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👋 from DevCon
Yannick was at Devcon IV in Prague this week, and was encouraged to see that it's still retaining the mission driven ethos of the early days despite the sheer size of the community today (3k+ attendees, 50% up over Devcon3). Zero hype, lots of energy, pragmatism and collective focus on solving the real issues of a post ICO bubble world. It's only by spending a few days right in the middle of it that one really grasps the strenght of this group. We'll post some of our favorite talks next week.
Kudos to the Ethereum Foundation in the meantime for the splendid organization, and a great choice in Prague, which was a wonderful host city.
This is also the reason this week's edition might be a tad shorter and later than usual.
The Coinfund team touches on the staking and borrowing dynamics, which are a completely new world enabled by tokens.
In short, there should be opportunities in the future (and there are some now) both for people to lend their tokens for a return and for investors / stakers to borrow these tokens and then earn a return by staking them to the network.
A very important point is made en passant here, "the fiat-denominated return of a staking opportunity still depends more on sentiment and network growth than the typical rate of token return."
In other words, as long as fiat price volatility stay so high, the opportunity cost of staking is very high and much more dependent on the fiat price returns of the token in the market than the simple return gained by the staking.
There might be ways to programmatically hedge this, and that might make for another interesting opportunity
If you've enjoyed the "Species" inaugural post of Dan's Planting Bitcoin series, the second post still delivers - as a timeline and suspected train of thought that brought Satoshi to publish Bitcoin's paper (which just turned 10 years old this week).
Productive capital vs Investment capital discussion from Chris Burniske, arguing that teams in 2017 "over-prioritized investment capital, and still haven’t put the measures in place to stimulate the conversion of that investment capital into productive capital".
- Shit crazy. BAT is the next token to launch on Coinbase Pro
- 🤯We don't really have a way to describe what's going on with Blockchains LLC in Nevada. The NYT has a feature and the company released a seriesofvideos that we still need to get our head around. Prague was covered in their billboards too.
- M&A. Bitstamp was acquired by NXMH, a Belgium-based investment company for a rumored $400M. The founder started it with 1000 Euros in a small Eastern European town. Kudos.
- Cool video of La Bitcoineta, a group of people going around Latin America spreading the word about cryptocurrencies.
- Not so DEXs. A sign of the times, when the largest so called DEX has to implement IP blocking and KYC/AML policies.
- Random acquisitions. Consensys has acquired the assets of Planetary Resources, a space company. We don't yet get it. And Lubin's comment isn't exactly helpful "Bringing deep space capabilities into the ConsenSys ecosystem reflects our belief in the potential for Ethereum to help humanity craft new societal rule systems through automated trust and guaranteed execution. And it reflects our belief in democratizing and decentralizing space endeavors to unite our species and unlock untapped human potential. We look forward to sharing our plans and how to join us on this journey in the months ahead.”
- Another interesting experiment in token design and incentives take hold, with the Beta of the ZEP token.
- Zcash update incoming, expecting orders of magnitude improvements.
Delta, one of the best designed crypto portfolio trackers used by 1M+ users, has launched a new service to connect teams with their token holders.
Blockfolio have also launched a similar service so presumably there is strong demand for it, which makes sense as there is to date no default platform for teams to engage with token holders, something that will no doubt be important in the post-speculative phase: more transparency and better stakeholder communication for everyone.
Uniswap exchange is a new decentralized exchange, which is essentially just one smart contract, which can't be controlled by anyone. It uses very similar mechanisms to those found in Bancor, but does away with the BNT token obviously, and only pairs to ETH.
This is really, really cool and a glimpse to what early adopter's view of the world. A world of trustless, autonomous and decentralized smart contracts that bend the infrastructure and application layers very close to each other.
QuickBlocks is a decentralized tool to let any developer access programmatically data from the Ethereum blockchain. It's built by a company touting to have been developing internet software before the Web, and that decided to focus exclusively on Ethereum since 2016. I guess that's a great signal.
Jeff Fagnan has finally unveiled Accomplice Blockchain. Behind the curtains, Accomplice has been investing actively in the space for a while, counting 20-ish early stage bets out of a larger 200+ strong portfolio.
Their approach will be to completely 'open-source' their book, from CRM to dealflow, from calendars to economics. This is something a number of VCs have attempted to do in the past, with mixed results. It will be fascinating to see this approach applied to the blockchain industry.
The long-rumored financing round has finally been announced, adding another $300M of primary capital to Coinbase bag in a Series E led by Tiger Global, with participation from Y Combinator Continuity, Wellington Management, A16Z and Polychain. The valuation is a whopping $8B.
According to the announcement, we should be expecting more aggressive international expansion, more crypto assets being added, more ecosystem integrations (eg USDC) and additional features for their custody solution.
Dapper Labs (fka Cryptokitties) has closed another $15M round, bringing in a series of industry investors from the entertainment and gaming industries such as Endeavor, aXiomatic, Animoca and no less than the lead singer of Muse. The round was led by Venrock.
The thesis continues to be that of creating compelling consumer content on the blockchain that can appeal to the masses.
Starkware, the company co-founded by the Z-Cash chief scientists that aims to commercialize STARKs, has closed a $30M Series A round led by Matt Huang and Fred Ehrsam's new fund Paradigm (their first check).
Disclosure: we are humbled to be a tiny part of this round and to support one of the best technical teams in this space. The 3-hr session on STARKs by prof. Eli Ben-Sasson was one of the most voraciously packed at Devcon, and rightly so: the implications of ZK-STARKs for both blockchain scalability and privacy are truly mind bending and we believe will enable entirely new use cases.
🤡 ICO madness
October ICO numbers are out courtesy of TokenData, confirming the recent trends. Whatever "ICO" means these days, $200M seems to be the new normal driven by activity in Asia, with a lot of industry funding shifting to traditional VC-equity rounds.
Coincenter shares some thoughts on and invites a constructive collaboration around the highly contentious recent speech from a CFTC commissioner where he hinted at smart contract developers potentially being liable for the use of their code if they could "reasonably foresee" a violative use of it at the time of writing it.
"Smart contract code is a tool, and like nearly any tool—whether it be a hammer, a gun, or a web browser—it can and will be picked up and used by both good and bad people for both legal and illegal purposes. It is not only possible, it is easy to reasonably foresee that any smart contract will be used for illegal purposes, because tools are themselves purpose-agnostic."