Outlier Ventures Daily Brief
Issue #14- Singapore’s guidelines for ICOs, increasing boardroom interest in blockchains, a mining malware you should watch out for, and the real costs of cryptocurrencies.
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1. Monetary Authority of Singapore Issues Guidelines on ICOs 👌
Singapore has clarified its stance on ICOs through a 14-page document issuing guidelines for startups looking to raise funds through tokens. The document provides clarity on the circumstances within which a token offering is to be considered a security. The Monetary Authority of Singapore (MAS) has also expressed the intention of launching a payments services framework to ensure ICOs are not used as a means to launder money or fund terrorism. The initiative shown by Singapore in creating the framework will further legitimise ICOs and their likely evolution toward a competitive funding mechanism. What is needed is regulatory watchdogs to protect the best interest of investors and give genuine enterprises a framework to work within. We don’t want more useless tokens flooding our markets, do we? It seems like there are (regulated) exciting times coming to the token economy.
2. Boardrooms Are Excited About Blockchains 😲
Boardrooms around the globe have been showing an increasing interest in blockchains. The FOMO behind missing out on the next disruptive wave is evident by the high number of companies filing patents & piloting blockchain proof-of-concepts. Earnings calls over the last quarter have seen over 400 mentions of the word “blockchains”. There are a number of reasons for this. To begin with, investor confidence in enterprises increase with blockchain integrations. As an example, consider that Square’s stock price jumped over 4% yesterday with Cash enabling Bitcoin purchases. In addition, simply mentioning blockchain often leads to ample media coverage to justify the costs involved due to the excitement in the ecosystem at the moment. Catch up on a comprehensive list of enterprise leads speaking about blockchains here.
3. New Malware Mines With Processing Power From Unknowing Users 💀
Content monetisation can be incredibly difficult. Users rarely ever click on ads and micro-transactions are yet to go mainstream (if they ever will). A new generation of “malware” takes an interesting route around this. Named coinhive, it resides on the landing pages of websites and mines using the processing power of computers owned by visitors. Most found on torrent websites, these miners run without the users being aware. The proceeds generated from these operations are then converted to Monero, a coin known for being difficult to track down. Adding to the trouble is the fact that hackers have been buying ads on unsuspecting websites to run these miners. As if there wasn’t already enough to worry about on the Internet, now we have malware hijacking our computers to mine cryptocurrency.
4. Money vs Cryptocurrency: The Real Costs 👀
The economics behind cryptocurrencies have been fascinating economists, computer scientists and network builders around the globe for a while. After all, it is Bitcoin’s deflationary nature and (early day) low costs in transactions that make it the darling of thousands of investors from all around the globe. A recent piece by Karl Kreder, director of energy at Consensys explores the costs involved in fiat transactions with those of Ethereum & Bitcoin. It then proceeds to look at the monetary policies integrated into each and provides a comparative analysis of the benefits and downsides involved in fiat and cryptocurrency based payments. If you’d like an example-driven article looking at the costs of transacting in tokens vs fiat, catch up on the entire piece here. He summarises with:
“This means that in terms of transactions costs cryptocurrencies are better than money and already have or will have lower inflation costs.”
