No financial invention has triggered as much potential disruption as Bitcoin. The implications of this technology affect every corner of the industry. In fact, the transformations that are resulting from Bitcoin are so broad that they are sometimes hard to keep track of in an organized way. This post offers a simple approach to thinking about these changes and a prediction that, in the long run, decentralization will be the most fundamental change. Read more.
Investment banking in a tokenized world. 3/12/2018
Investment bankers make money by creating liquidity. Bitcoin and Ethereum have triggered a tidal wave of liquidity through the process of tokenization, in which assets of all types, from currency to equity to art, are recorded on a public blockchain and traded on new exchanges. Is this good or bad for investment bankers? It is very good. Below are a few thoughts on the many ways in which investment banks can benefit from tokenization. Read more.
The promise of Bitcoin is not to get rid of banks, it is to offer people an alternative so that banks and the monetary system can be improved. The current monetary system has two major flaws - people must use banks for payments and governments can print money. Both of these flaws erode trust in the system. A Bitcoin-based banking system would solve these problems with competitive decentralization. Read more.
Introducing the Global Currency Fund 2/25/2018
The Global Currency Fund is the first hedge fund focused exclusively on the growth of decentralized global currencies. We only invest in currencies that are well positioned to grow as a Global Currency. We assess many factors in selecting and weighting these currencies, including: governance structure, focus on merchant adoption, payments infrastructure development, existence of treasury funding for development and marketing, currency and platform features and the general attractiveness of the currency for adoption on a global scale. Read more.
In a recent research report on cryptocurrencies, JPMorgan frames the question as whether one of the new decentralized currencies, such as Bitcoin, will be able to break the government's "natural monopoly" on currency. What does this sound like? Yellow cabs and Uber in New York City? Read more.
Gold should embrace bitcoin. 2/12/2018
Last week the World Gold Council released a report on cryptocurrencies that described bitcoin as a competitor to gold. This is a very bad strategy if the Council wants to promote gold usage. Thanks to bitcoin, gold now has the opportunity to regain its status as currency, rather than simply a store of value. Gold may not be as good of a currency as bitcoin, but it certainly has a very bright future if non-governmental currencies end up replacing fiat. Read more.
Schnatter Institute Panel 2/7/2018
Thanks to the Schnatter Institute for inviting Shane Hadden to speak about bitcoin with currency scholar Dr. Will Luther.Watch the video.
When the cryptocurrency markets are as volatile as they are now, it helps to remember that these coins are just kids. Until they grow up, they are going to be very unpredictable. Their prices won't become stable until they reach their full market potential, which, in the case of the global currencies, is measured in the trillions of dollars. So it's a good time to think creatively about how they might grow. Bank partnerships and marketing are the obvious suggestions. Below are three strategies that are more on the fringe, but each is either happening now or is likely to happen over the next couple of years. Read more.
Can you name a public good that can only be created by the market? Answer: A decentralized global currency. National governments will never create such a currency, but the markets can and will. A decentralized global currency would help tie the world together in peace and prosperity. Just like a common language would improve global communication, a common currency would improve global commerce and economic integration. Read more.
BTC Miami. It is still very early. 1/22/2018
The largest crypto conference to date was held in Miami last week. In Bitcoin time, this conference has a deep and legendary history, going back five or six years. Below are a few selected observations from the conference by crypto-category. Read more.
Currency is traditionally defined as a medium of exchange. We believe the term "medium" creates confusion in the age of digital payments. We suggest a focus on currency as a "unit" of exchange. Read more.
Hey bitcoin. Close the deal! 12/17/2017
Sometimes bitcoin sounds like the guy who can't keep selling even though he's got the sale. All he can do now is screw it up. People love bitcoin all over the world. People love the idea of not having to trust a bank intermediary when sending money. People love the idea of not being subject to a government printing money. They are buying. It's done. But bitcoin keeps selling. "Oh, it's going to be even better. We'll make it faster. We'll make it even more decentralized. We'll . . . " Just shut up and close the deal. Read more.
Bitcoin has triggered a race to become the first global currency - one that is accepted by merchants in every country. The prize for the winner is a value measured in the tens of trillions of dollars. So who's in the race? Who's not running. Who may be the next to join? Below is a snapshot of where we stand today. Read more.
It is true that bitcoin cannot be created at will by a government simply by printing it like paper currency. However, that does not mean that the supply of bitcoin is capped at 21 million. Read more.