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Are We There Yet?

Looking Back On My Personal Cryptocurrency Experiences

When the Monkey Capital ICO was delayed indefinitely something of a crypto bomb went off in cyberspace.

It can be instructive sometimes to take stock and consider how things in your life got to be the way, the place and the experiences they were, especially after an elongated period of workaholic focus. Given that my last White Paper (on digital notes) has now been completed in something of a year-long journey, now is as good a time as ever for such recollection.

I first began writing a markets column for CoinDesk in September 2014. In actual fact, I pitched CoinDesk the markets column as far back as December 2013, but the editors at the time weren’t sure there would be enough sufficient interest to warrant a market for articles about the price events of Bitcoin. At the time, all Bitcoin-related news was focused on the technological development of the Bitcoin Blockchain; the fact that the only coverage of Bitcoin today is price analysis was something almost unthinkable back then. I argued for 9 months back and forth with them that there was huge pent-up demand for such coverage. Eventually, the powers that be relented. Sure enough, my columns started to fly like Concorde.

Around the same time as I began that CoinDesk column, which later evolved into me becoming Editor-in-chief of CoinSpeaker for a couple of years, I began lecturing across Asia at various industry events on the value properties associated with Blockchain. It was at such an event, in fact, the night before I gave the third of a series of presentations titled The Age of FactoryBanking — What’s A Bitcoin Worth? and I was in Hong Kong, when I was preparing the next days’ presentation in question, that I conceived of the idea of a Value Coeval.

As I point out in my latest book The Blockchain You Don’t Know, concept of the Value Coeval was something I cribbed from the theory produced by two professors of mine in 2006 at Business Institute in Oslo, during my one-year executive MBA. As far back as 1999, Professors Oeystein and Stabbell noticed that different industries could be divided into different categories depending on their value configurations. Broadly, they identified three such categories. The categories they are identified are Value Chains, which operate according to a manufacturing/wholesale/resale model, where the product is gradually marked-up according to how far down the supply chain it is being sold; Value Shops, which operate according to a knowledge sale solution, such as a consulting firm, a legal practice or a doctor’s clinic; and Value Networks, where the profit margin is not in the product mark-up according to specification or knowledge-input but in the extra value-utility that every individual jumping on the network exponentially brings with them (back then this was only just emerging with the rise of the internet). It was my realisation that Blockchain was in essence a coeval — a combined simultaneous operation — of all the categories of value configuration. On the one hand, there is a product that is marked-up and sold according to a standard supply-chain — be it Bitcoin, Ethereum or any other digital currency — while on the other hand, there is huge knowledge input value in the form of developers across the world enhancing the value of the technology. At the same time, Blockchain is most significantly of all, an integrated digital payment network.

Blockchain is the only industry category in the world, I realised, that can presently be considered to be a Value Coeval. This unique value proposition afforded it a great superiority in offering potential for extraction of financial returns. After all, if all the knowledge you put into your product development is subject to an exponential mark-up in the form of every additional participant who jumps on the network, and the product is sold according to a standard supply-chain wholesale/retail sales model, then clearly, you’re going to make more money manufacturing and retailing in such an environment than you are in a space where there is humongous overhead cost and where the time to product delivery is fraught with a constant real-life logistics complexity.

Over the subsequent years, up until last year, I developed a series of equations that very precisely predicted the price of Bitcoin first of all three years, then half a year later, down to the exact dollar, and indicated that Ethereum would become something of a mainstay feature back when it was only a dollar or so.

That’s when I began Monkey Capital, a brand that I planned to ICO a year ago. Instead of undertaking the ICO, however, I pre-emptively sold MNY — as it was in its first incarnation as a Waves-based token — on the market on Waves Decentralised Exchange (DEX). Why I did that is the subject of considerable controversy and speculative criticism, but the reality was because seeing the success that COE, an ICO option (and the only ICO option to date, still, I believe) rise 180,000% in just over two weeks, I felt that a market-based ICO would fare better than one undertaken by process of Dutch Auction. Specifically, I felt the construct of a Dutch Auction — where the money is all collected and the tokens are distributed afterwards — was somewhat too much like a securities offering in terms of sale for my comfort. My colleagues at the time disagreed, and so I ended up cancelling the ICO, offering MNY in Waves form for sale on the market, and thinking, well, I’ll figure something out.

In hindsight, this was an incredibly stupid thing to do. This is especially so given that COE was trading roughly $500,000 or so per day in market volume, day-in, day-out. Clearly, what I ought to have done is held the MNY ICO and accepted COE as the only currency of participation. We’d have been able to claim an incredible raise for the Monkey Capital ICO in that case, since the COE would have risen in value as supply was removed from the market in lieu of payment for MNY, we’d have had an ultra-smooth product delivery process in the form of a simple one-time Waves-based wallet distribution event, and we could have watched the Waves tokens accumulate increased value henceforth.

The only problem was that this didn’t solve a more fundamental issue with the ICO — as much as I might have possessed a superior knowledge of the digital ledger’s value functions, I hadn’t a single clue about its potential utility. In fact, I hadn’t even conceived of a single utility for MNY at the time. Inadvertently however, I had formulated a very curious new utility in COE; that was option utility. The way COE worked was by acting as an enhanced purchase asset for MNY. That is to say, every COE that was used to pay for MNY acted as an enhanced purchaser of MNY versus BTC. Watching COE and MNY traded in tandem side-by-side on Waves DEX, which back then allowed free trading of all asset pairs against one another, I began to understand better how cryptocurrencies created an alternate sort of Value-Utility variable that could potentially be exploited in the form of a smart-contract based technology.

Fast-forward to January 2018, and, still alive but only just barely, I worked with a number of developers around the world to make the first of what I have described in a recent White Paper as digital notes. Digital notes come in the same technological form as their siblings, Blockchain tokens, but the smart contract technology is employed to effect a swap-back at the end of a particular event (be that a period of time lapsed or a certain supply quantum that has been issued or whatever other variable). This enables the Blockchain asset to be used as a mechanism of cash which, when configured a certain way, inflates in value exponentially during the period it is held. Further still, because a digital note is a mere proxy for a much more liquid and more widely-used digital coin (for example, ETH), it doesn’t really need a lot of additional rubbish utility applied to it.

Where has this all led to, then? Well, unbelievably perhaps, this story has a uniquely happy ending. For in the final quarter of the year, we managed to get the innovations we painstakingly worked on throughout this hiatus in cryptocurrency market momentum to the point where three major crypto exchanges were ready to list the products. What is more, a public company deal I had tirelessly worked on over the past two years began to simultaneously materialise. Crossing paths with synthetic and real income innovation, we managed to marry the public and the Blockchain deals together into a public listing which concurrently coincides with the result being maximum revenue and financial impact. In this we now look to materially change the way in which public company’s innovate financially. That’ll be another war, for sure, but at least we will be able to say the first one was well and truly won.

And that is the purpose of innovation: it’s to turn everything that looks back to face the future, looking forward.



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