Umberto Pagnini and Gianluca Panelli use a detailed scoring system to select projects to include in their equally weighted DAA. Learn more about this process, their views on the challenges involved in achieving mass adoption, their perspective on the emerging Italian crypto scene, and more in this week’s interview.
How would you describe the blockchain and crypto ecosystem in Italy? Are there enough meet-ups? Where do you see the most interest coming from?
The blockchain and crypto ecosystem in Italy is still in an early stage. We think the main reason is tax legislation, which still needs to clarify several doubts about how to declare income, losses, and so on. Italian talent tends to set up companies in more blockchain- and crypto-friendly environments, such as Switzerland and Malta.
There are several meet-ups in Italy, especially in Milan. The number of meet-ups is slowly rising, and even the national media are starting to talk more often about this emerging phenomenon.
We think that banks are the most active companies in this field in Italy. However, even companies linked to the world of information technology are beginning to explore the world of blockchain in order to implement it in their solutions.
What is the major innovation crypto is bringing to the world? What is the biggest challenge?
The major innovation crypto is bringing is decentralization/disintermediation — the ability to avoid the middleman. Transparency and certainty about the veracity of data, information, and transaction histories are other elements that can be positively influenced by cryptocurrencies.
The biggest challenge is creating a legal standard to allow companies to grow in a solid and stable environment.
The second biggest challenge is educating and introducing the masses to cryptocurrencies without taking advantage of the general lack of knowledge, as happened in the past in the financial world. The third challenge could be competing in a market where innovations are often shared and therefore easily copied.
In your DAA strategy, you talk about project selection. Can you share more about your selection of different projects? How do you evaluate whether a project has a real solution to a real problem?
We have very carefully studied all the digital assets available on the ICONOMI platform. We attributed each of them a score based on ten different metrics, and those with the highest scores were re-evaluated until only 8 remained. We gave each of the remaining eight a 10% weighting in the composition of our DAA, and the remaining 20% was divided between ETH and BTC. We think 10% for each digital asset is a good compromise between performance and diversification.
Since the crypto world has become more popular, thousands of projects have been born, and for many of them it’s not really necessary to implement a blockchain — it’s only used as a marketing tool, and in fact for many scenarios it would be less expensive to use a traditional database. Our goal is to identify serious projects that use the blockchain in an intelligent way, enjoying the advantages that derive from it.
Which project would you outline currently, and why?
As mentioned above, we believe that legal certainty is essential to offering safe products and allowing the healthy development of the ecosystem in question. GBX is one project trying to pursue this goal.
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