Tokyo FinTech
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Tokyo FinTech

Conference Review: Token 2049

Impressions from a blockchain event and implications for the industry

The highly anticipated Token 2049 blockchain conference took place from March 13 to 14 in Hong Kong. Billed as “the premier digital asset event in Asia”, our takeaways from and general impressions of the event might well be seen as indicators for the industry as a whole.

Attendees

Naturally, in a bear market, fewer people tend to attend conferences. The organizer had anticipated more than 2,000 people, but it seemed there were way less. This might not surprise as much when looking at the ticket prices. A 2-day-ticket for just attending still had a bull market price of USD 1,199. On a personal note, everyone is talking about mass adaption, but such a price is in no way affordable to the masses. For comparative purpose, the average salary of someone working in Hong Kong amounts to USD 2,140 per month. You do the math.

Exhibitors

Last year the exhibition space had been dominated by blockchain projects. This year, there was a striking amount of service providers such as consulting companies, PR agencies, BaaS providers, KYC/AML providers, cybersecurity firms and exchanges/trading platforms. It seems like the industry is shifting from smaller companies providing new blockchain-based solutions towards a more service-driven approach. It will be interesting to see, how more and more service providers compete for fewer actual blockchain startups. One way (which many are going already) is offering their services to companies from other industries. Another way to grow their business could be a horizontal acquisition. In general, we can expect more M&A activity in the blockchain industry this year.

Sponsors

A quick look at the partner organizations and sponsors reveals that most of them are major players. To name a few: Tron, CoinMarketCap, Caspian, Wachsman, Aeternity, Coindesk and many more. One can easily interpret that as a sign of less new entrants in the market, or a sign of the lack of liquidity of newer players. (Or maybe their unwillingness to pay thousands of dollars for putting their logo on a sponsor banner.)

One trend among sponsoring organizations is not hosting a booth. The reasoning behind that is, between speaking in panel discussions, solo speeches and simply attending, one can get the same amount of exposure as with hosting a booth. In view of the declining attendee numbers, asking high prices for an exhibition booth could be a thing that conference organizers have to reconsider.

Speeches/Discussions

A lot of speeches featured the word “decentralized” in their title. Decentralizing IoT, decentralized AI, the future of decentralization or the decentralized web, and so on. After 10 years in the industry, decentralization remains a hot topic. It is funny though, while the noble mission of bitcoin was to give us a decentralized network, still, it has given us one of the most centralized business models ever: crypto exchanges where brokerage, trading, clearing and custody are all under one roof.

Crypto funds were another hot topic, both their way of managing investments in digital assets and the question about custodian solutions for digital assets. The latter is seen as especially important if we want to attract institutional investors to cryptocurrencies or other digital assets. Private investors normally invest their own money and might not need a custodian. In comparison, an institutional investor is dealing with other people’s money and the question of storing and keeping the digital assets safe gains more relevance. With more and more crypto exchanges offering custodian solutions, it creates the impression that they are developing a different version of the financial system we already have.

Further discussions included the web 3.0, smart-contract platforms, outlooks on the prices of major coins, security tokens (they are everywhere recently), blockchain for social impact as well as privacy.

With or without banks?

The question around the direction of the industry came up several times during conversations with different stakeholders. On one side we have the bitcoin maximalists, who stand up for decentralization and want people to be their own bank. On the other side, we have those arguing that cryptocurrencies will not gain mass adaption if we do not collaborate with banks and regulators and that banks will not go anywhere. In a similar category falls the discussion about privacy currencies vs. KYC/AML requirements.

3 problems of this industry

The problems of this still nascent industry were covered in many panel discussions and private conversations. One of the biggest challenges that has been mentioned repeatedly is speculation. It is well accepted that pump and dump schemes do more harm than good. The same goes for wash-trading, faking trading volumes and outright scams.

Usability and user experience also featured high on the list of issues to address. Until now, for a person entering the space, it can be pretty daunting to deal with private keys, wallet addresses, or crypto applications. Fortunately, there is hope since many companies are working to make crypto easier to use.

Last but not least, most blockchain use-cases are still in the proof-of-concept phase and we are yet to experience a wave of blockchain use cases at scale. However, most people are pretty optimistic in that regard, especially when it comes to supply chains as well as the tokenization of traditional assets through security tokens.

Final thoughts

Despite fewer attendees than expected, Token 2049 has been a very interesting event providing valuable insights into the blockchain industry and a great opportunity to create new connections. However, even a blockchain baby like me (7 months in the industry) could meet a lot of familiar faces, which shows that the industry is still fairly small regardless of its potential.

The avocado is a reference for comments made by Vitalik on Tron Founder Su (https://www.chepicap.com/en/news/8110/justin-sun-trolls-vitalik-buterin-with-an-avocado-at-ethereum-speech.html)

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