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. Among other notable events, this was where Vitalik Buterin first announced Ethereum in 2014. (After you read this post I recommend watching Vitalik's presentation - especially his explanation of why many currencies are good for society.)
This year's audience was much larger than in previous years. According to Moe Levin, the conference organizer, the original plan was to have the event in the exhibit hall (maybe seating 500 or so). He had to move up to the Convention Center's large theater space at the last minute to accommodate the sold out capacity of 4,000.
2017 was the big bang for cryptocurrencies - rapidly expanding chaos. The chaos is still present, but there is also a great deal of creativity and some order forming here and there. This was my first BTC Miami, so I can't compare it first hand, but I suspect that this one felt more like a transition than the previous events.
There was the obligatory discussion of riches made and private keys lost, but, for the most part, everything was forward looking. It feels like every area of the tokenization space is still in its infancy and flying under the radar. As evidence of this (possibly superficially), I saw very few Wall Street or even fintech people - the usual ABS and Money 2020 crowds were not there. This is shocking, considering the potential of tokenization to upend every corner of finance.
Below are some selected observations from the conference by crypto-category:
Currencies: Deference was paid to Bitcoin without exception. There was no contentious talk of SegWit, block sizes or BCH. Ryan Taylor, CEO of DASH, outlined an impressive execution plan to invest in the DASH ecosystem. The increase in the price of DASH now allows them to spend most of their Treasury dollars on marketing. DASH is working on merchant and payments partnerships and have hired Ogilvy and Mather to create an ad campaign. That is very good news for the prospects of a global currency as consumer and merchant adoption is critical. Decred had a similar story to tell as far as starting to focus Treasury dollars on marketing. If Decred adds marketing to their state-of-the-art development and democratic voting regime, they will be highly competitive in the global currency race. Ricardo Spagni from Monero promoted that team's highly decentralized approach. No one presented from Zcash, Litecoin or BCH. I was hoping for more on Metronome, but they didn't have a booth.
Utility Tokens: ICO pitches made up about 35% of the conference. Start-ups were tokenizing rights to every service from tax preparation to luxury car rental. Some made sense, others felt forced. Although there were many exciting new projects, utility tokens as a class were the subject of much derision and scorn. One bitcoin pioneer and founder of a well known early-ICO actually said he now hates almost all utility tokens. I think this is unwarranted. There are certainly a lot of scammy utility tokens and ICOs, but the utility token itself is a valuable new tool for businesses to raise money in a way that offers advantages over traditional equity. I hope bad actors and regulatory uncertainty don't scuttle what could be a major new outlet for marketing and start-up funding innovation.
Security Tokens: The biggest theme of the conference may have been the rise of "security tokens." These are tokens that represent ownership of traditional assets, such as common stock. Polymath seems to be making the biggest splash as a platform for creating security tokens, having already pulled together a network of 50,000 advisors, issuers and investors. Polymath's CEO Trevor Koverko predicted his company will do for security tokens what Ethereum did for utility tokens. Patrick Byrne's T0 is pioneering this space with a regulated exchange for securities tokens. There are also many boutique service providers like Securitize.io to help companies raise traditional funds in the form of tokens. I believe it is inevitable that most securities (and other large assets) will eventually migrate to token-based ownership. I would prefer the term "ownership token" or "title token," rather than "security token", since neither the token nor the underlying asset are necessarily "securities" from a regulatory perspective, but based on the recent widespread use of the term, it may be too late.
So there was both creativity and chaos at BTC Miami. The industry is growing too quickly for there not to be chaos, but the amount of creativity present points to an exciting next period of growth.
All in all, BTC Miami felt much more like beginning than end. For anyone thinking about jumping in to the tokenization space, I would say it is still very early.
About The Currency Report: The Currency Report promotes the adoption of a decentralized global currency. We provide advisory services to new currency designers and investors, including our fund, the Global Currency Fund. Read the Guide to New Currency Valuation and Design, sign up for our blogs or, for accredited investors, inquire about our fund. For more information contact Shane Hadden at firstname.lastname@example.org.