Following last week’s discussion on the topics of mining and public vs. private blockchains, our group moved in a new direction this week to discuss ICOs and future predictions for all things Bitcoin.
By the time the meeting ended, we were pleasantly surprised to find out that Bitcoin had hit yet another all time high!
Presentation — ICOs (Initial Coin Offerings)
(Matt Balsei and Akshay Jain)
- ICOs allow startups to bypass venture capital funding and get their users involved by purchasing the startup’s new coin
- The blockchain startup funding market has been dominated by ICOs, with $797 million being raised through ICO funding in Q2 of 2017 alone
- When investing in an ICO it is crucial to consider the team behind the project, as you are placing faith in them for the coming months or years
- Many risks for investors come along with ICOs, especially with these small cap markets being easily manipulated by pump-and-dump tactics
- Regulation has been an important factor recently introduced into the ICO process, with the United States considering new coins to be securities and China outright banning ICOs as a whole
- When planning an ICO, it is important to consider whether the new coin is actually necessary. Building on a blockchain can become expensive, so it is worthwhile to consider the other options before introducing a new ICO.
If you’re interested in learning more about ICOs and their relationship with venture capital, check out my article on the topic!
Discussion — What Will Bitcoin Look Like in 20 Years?
(Rama Somayajula and Ben Oostendorp)
Tool for Transactions vs. Store of Value
Bitcoin enthusiasts are split — one side sees Bitcoin as useful for everyday transactions, while the other considers it most useful as a long-term store of value, similar to gold. When we discussed this as a group, the majority expected to see Bitcoin continue on the store of value route, specifically because of the constantly changing price point.
“Killer Application” for Bitcoin?
As a group, we discussed what kind of brilliant application would take Bitcoin beyond mere relevance and make it necessary in our everyday lives. In order for this to happen, members said Bitcoin would need to not only have all the features of current systems like Visa, but would also need provide something for users that the existing payment systems can’t offer.
New Technology Replacing Bitcoin
In its current form, Bitcoin can never be that “killer app” that makes blockchain technology useful and necessary. However, emerging technologies like the lightning network can be built on top of Bitcoin to ultimately provide an experience that will bring banking into the next era.
Thank you for reading, we hope you enjoy these brief insights into our weekly WCT discussions!