The recent Japan Blockchain Conference in Yokohama, (Jan 30/31, 2019) attracted over 3,000+ attendees. Many were from overseas, in fact 25% were foreign non-Japanese. These are my personal notes from 2 full days of speaker observations and follow up conversations during the event. I learned a lot, and much of it was unexpected insights. First of all, I had to pick and choose as there were 2 live stages with speakers. I really learned a lot. It was worth my time. There were over 40+ booths with mostly global firms promoting themselves in Japan. For those would could not make it to Yokohama in person, please review my personal Blockchain conference notes with 54 insights to get up to speed on what you missed.
Brock Pierce, The Bitcoin Federation, has been deeply involved with the bankruptcy of Mt Gox since 2014. In fact, he purchased 88% of the equity directly from former CEO Mark Karpeles, and 12% of equity from Jed McCaleb, the original founder.
* Why has there been no payout to defrauded investors yet after 5 years? Coinlab is the main reason due to a broken contract claim. This is a long standing lawsuit because Coinlab was originally engaged to bring Mt Gox to the US market. It failed and the contract was cancelled as no delivery was completed. They were to get a 90% share of profits from the US market.
* Despite this poor outcome, it has become been successful as a nuisance lawsuit, and has delayed all Mt Gox creditor payouts. Brock has just started GoxRising.com which is now the new center of all creditor claim info.
* Most creditors had an expected $400 refund claim per BTC, the original price at the time of the bankruptcy. Over 134,000 BTC and 164 BCH worth over US$600Million is at stake as a minimum. There are 24,000+ creditors today. The deadline for all Mt Gox claims in Japan is March 15, 2019, to then be reviewed by the liquidator on March 29.
* Bernie Madoff's bankruptcy recovered 70% of all lost assets that were returned to investors. Hopefully this amount or even more will be possible for all Mt Gox creditors. Brock wants all creditors to be 100% whole.
* Due to his previous wealth and knowledge of running various game currency platforms, he thinks he can figure this out, and navigate the legal mess it is now in. He knows market making from his game token days.
* Brock started making markets from game tokens back in 1999. He was PayPal's biggest global merchant for 3 years, and Google's biggest advertiser at the time. He built a US$20 Billion dollar business. He dominated markets in Japan, Korea and China not just the US or Europe.
Phil Chang, CryptoScientist, Related to this recovery story, I ran into a former Silicon Valley executive who has had a high 90% success rate recovering lost BTC and other crypto wallets. If you have lost access to 50 BTC coins or similar amounts, then it could be worth recovering given current valuation rates. Include "TMJ" in your initial message for better premium service! He is on Telegram, WhatsApp or www.facebook/CryptoScientist
Hitoshi Taguchi, DMM Bitcoin, explained how many new services will be released in 2019. One of the most exciting will change the appeal of Bitcoin. He is working on a new system that will offer high interest rates to holders of bitcoin.
* These will not just be similar competitive rates to fiat banks. These will be 20 times MORE than fiat banks. For regular interest earning savers, and there are many elderly in Japan or retiring baby boomers world-wide, this could be a huge market they can appeal to. A real Game changer!
* Japan's cashless payments market is now 64 Trillion yen today, and is made mostly from credit card transactions. The government wants this to double by 2025. The only way to do this will be via new debit cards or crypto compatible payment systems for consumers in Japan, not more credit cards.
* The marketplace is getting crowded, and there seems to be only space for large whales to enter into financial services. An oligopoly seems to be dominating leaving smaller startups with less chance of winning on their own. A takeover play seems most likely by large players of promising startups that struggle to find enough traction or footprint size.
* The global market has been tied to oil, and the US dollar has been the dominant currency for this. No matter what country you are in, any nation needed to change any local currency into US dollars to buy oil, and grow the economy.
* Crypto may have a direct impact on this USD oil trading dominance. It may not last if rival governments start to accept tax payments locally in Bitcoin or other crypto. This would lead to not only mass adoption faster, but minimize the dominance of the US dollar in world trade.
Tim Draper, DFJ Venture Capital, said that all countries around the world will face a new challenge. Government services will soon become cross border competitive, and will be looking to compete for global citizen customers. Geography and borders may no longer be as limiting as before.
* Due to the Blockchain, Estonia is now able to offer virtual citizenship. This will allow anybody like Tim, to have the ability to open an EU bank account or buy property anywhere within the EU. This is quite a powerful potential service platform.
* Luckily Japan has embraced crypto currencies early. The countries who do so will benefit the most as the economic benefits spread quickly. Japan is positioned well to take advantage of these new potential benefits.
Travis Kling, Ikigai Asset Management, mentioned that Blockchain is little more than a slow database. It is not needed for all things in future. Some will benefit greatly, but all products and services? Not at the present moment.
* Travis has views that reflect his trader background of 10 years of trading experience. Coming from 2 top global hedge funds previously, Magnetar and Point72 (formerly SAC) he really knows how to professionally trade crypto.
* He has "fallen down the rabbit hole of crypto" and explained a number of new concepts. Everyone who saw his session got a very unique education on how to trade in crypto.
* Bitcoin is now best within the crypto space as a store of value, but not a method of exchange for transactions. Capacity speed is too limited today, but this could change.
* Few have heard of Venmo. It is a digital bank that is rising in size similar to JP Morgan and Bank of America. It will grow in a multi-billion crypto institution in the future.
* The current value of ETH 1.0 is now US$10 billion today and ETH 2.0 is till 5 years way. It is a slow growth play now. Do not expect a quick return due to a new ETH version.
* Mimblewimble, Starks, Snarks, and Ring Signatures are 4 new ways that are improving Blockchain privacy & speed.
Charles Hoskinson, IOHK, Will citizens be gamified in the 21st century? China seems to be preparing for this by a new "social credit" system only possible with the Blockchain and algos. Pilot programs are in place in Beijing. It seems to be a dark path in the future.
* The big brother experiment may finder more followers like Saudi Arabia, Ukraine or any other nation that needs to fully control its people.
* Troublemakers may soon be branded with a new digital red letter, and be untouchable by social media contacts via threats from new social point penalties.
* Information used to be only shared with kings and the economic elite. The internet has changed this. Today in 2019, any internet user has access to more information that US president Bill Clinton did in 1992, when the internet began.
* More positive uses like "mechanism design" can also rise up for the good. Imagine a reverse insurance policy that pays you if an elephant or giraffe stays alive. This may help people support important conservation projects and still financially benefit.
* Africa may have the most promise for Blockchain due to its youth. Ethiopia have 70% of people under age 30 today. It is a young population that are digital natives. They are eager to make new changes to their economy.
* IOHK have taken 23 developers and put coffee production onto the Blockchain locally. This will help 1.5 million local coffee farmers in Ethiopia find better prices from confirmed sourced coffee in world markets.
* This private/public partnership helps the local economy, but also introduces 1.5 million farmers into the crypto space that had no incentive to do so previously. If there are only 50 million wallets globally, that is expanding the crypto world by 3% in one single action. This can be scaled and transplanted across much of Africa and many other developing nations.
* Mass adoption so far has focused on sales of products or services, but if government can start to accept tax revenue in crypto, that would quicken the mass population into accepting cryptocurrency over a much faster period. The coffee farmers paid in crypto, would be an obvious willing new base of tax payers. This can spread far and wide very quickly.
* Humans need to find ways to minimize negative short term actions that leave long term impacts. We have to figure this out early to prevent any damage we do not know about today that we may cause longer term.
* MIT university have a group called Algorand that is helping. They are creating pier reviews of research papers that are encouraging more universities to do research into these areas. Cornell university have a similar group.
Scott Walker, DNA, has made early investments into EOS, Ethereum and Hashgraph. They have recently invested into Casperlabs. CBC Casper started as a way to make Ethereum faster.
* Mrinal Manohar is the CEO, he described how PoF (Proof of Work) needs to move to PoS (Proof of Stake) in future. Proof of Work often generates random numbers that clog transactions 85% of the time. Proof of Stake uses 85% of the numbers used in transactions to help speed and productivity for all.
* He also feels that open source code helps all coders to collaborate and be less combative. Open architecture encourages more productivity as a result.
Naojiro Hisada, Rakuten, shared a lot of corporate facts about where they see Blockchain, and where they want to go. The Rakuten brand has reached full saturation of the domestic market in Japan, and needs to grow overseas.
* They have over 100M user accounts in Japan, 1.2 Billion user accounts globally, given the 125M citizens, almost all adults in Japan have an account. Growth needs to be global.
* They transacted over US$30 Billion in Japan, US$112 Billion globally in fiscal year 2017 ending in March 2018 from over 70 services in the group.
* They have grown internationally due to sports marketing in baseball (Rakuten Eagles) and soccer (Rakuten FC Barcelona).
* They have created over 1 Trillion points from all of their program incentives. This comes from over 700,000 stores based mainly in Japan. More will soon be from overseas.
* This points program started in 2002, and is 15 years old.
* They now have 10 overseas development centers globally in 8 countries. Over 200+ engineers work in both Singapore & San Jose, California, USA.
* They have only 41% Japanese staff, 59% are foreigners.
* They have a 77% male vs 23% female ratio in the group.
* They will open a Rakuten Wallet by April 2019. This will use all global points via Blockchain, and may include crypto.
* RETS (Rakuten Energy Trading System) now trades carbon offset. It is used internally and may be offered to all this year.
* R-STAR is a new way of using digital coins as "tips" to colleagues who help or guide you at work as a mentor.
Interesting Blockchain random points heard include;
* Forbes will start a new index for the top 10 high volume crypto currencies, it will be called the FB10.
* Y2X are working on a way to bring digital liquidity to real estate. A developed property may have unlocked value of 30% or more based on popularity & current price value.
* Undeveloped properties like raw land could be much more. These values could go up 10X-20X as electricity, water and full building development are built out over time.
* Some 64 times as many people want to emigrate and leave China than immigrant into it in 2018. This fiat outflow pressure is being countered by use of crypto overseas.
* The huge difference between Chinese inflows and outflows are reflected in fiat, gold, diamonds or crypto being used to move wealth out of China. The pressure on these outflows is huge.
* Rakuten bought a Skype like service called Viber. It now has 900M globally active users, and is growing.
* When Bill Gates began Microsoft, he had no luxuries like bean bag chairs or ping pong in his startup office. They made desks out of empty pizza boxes in the early days.
* Since 2009, around 55% of crypto exchanges have failed. If that were the same for banks, would anybody keep deposits in a bank? Cold wallet security storage still needs work.
* LINE now have a crypto exchange in Singapore called Bitbox that is preparing compliance now and may even include Japanese clients in future.
* LINE & Nomura Holdings will start a joint venture. This could change how the 78 million users of LINE Japan. There are also 40 million in LINE Indonesia, 20 million in LINE Thailand and 8 million in LINE Taiwan. The JV will figure out how to work with the 2 million retail account users of Nomura, and change financial services via Blockchain with social media.
* JETRO will expand a new startup visa program across Japan. They first began with a 6 month visa possible in Fukuoka. It will soon be extended to 12 months anywhere in Japan.
* Africa is under used for crypto global needs. Less than 1% is now held by African people today. With 7.7 billion citizens alive today, too few in Africa use crypto despite high population growth.
* Media and national governments have not been positive on the image of crypto currencies to date. This is mainly due to the fact that they are in fear of any lost influence economically.
* High Net Worth Individuals in 2018 have taken advantage of the price downturn in crypto markets. Many family offices are large holders of crypto now. Often each hold over US$1 million worth in each account, sometime many times more.
* BTC can execute at 10 TPS (transactions per second). Ethereum 25 TPS, but Hedera Hashgraph is 100,000 TPS. It is a huge magnitude faster. It is like comparing the speed of a horse and a jet plane. There is no real comparison.
* The world changes fast. Back in 1992, there were only 10 global websites, today there are over 1.8 billion websites around the world. Many grew rapidly after broadband came out in 1999. With 5G technology around the corner, a new level of growth is about to spread worldwide.
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