Web 3 is the next generation of the web in which decentralized apps (dApps) operate on top of a shared data layer and users have control of their data and the ability to move between dApps with little to no switching costs.
Think about the way domains and email addresses work. We (individuals and/or companies) own these identifying data elements and we can provision them in any app we want (I provision my email addresses in gmail and my domains in wordpress but I could choose many other options). In Web 3, this is how all of our data will work.
But we have a long way to go to get there. The infrastructure for Web 3 is immature and at least a few years away from being mature and stable enough to build mission-critical dApps on. We can see glimpses of Web 3 in games and collectibles, where the stakes are
As the United States celebrated its Independence Day on July 4th, several jurisdictions around the world, including South Korea, Bermuda and Malta, passed legislation to support crypto assets and virtual currencies. Of these, South Korea’s appears the most detailed by providing a classification scheme as a framework for regulation. This is the most sophisticated understanding of the blockchain sector I have seen to date from a government:
“The government has subdivided its industry classification scheme into three sectors, with ten further subdivisions under the guidance of the Korean Standard Industrial Classification ( KSIC ). The subdivisions include detailed considerations of blockchain-powered infrastructure for DApps such as EOS ,Ethereum and NEO , blockchain-based cloud computing services, and cryptocurrency mining.The survey is also covering blockchain systems integration into existing industries, including the financial sector, security, insurance, copyright management, supply chain management, medical services, and software development.” — Cointelegraph, Continue reading "Dog Days of Summer"
I wrote about Ether’s big day yesterday. In this podcast, Laura Shin and Coinbase’s Adam White, who runs the institutional business there, talk about the Ether news and Coinbase’s institutional business. It’s a quick 20min listen.
“Putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions,” William Hinman, who heads the Securities and Exchange Commission’s division of corporation finance, said in remarks prepared for a Yahoo Finance conference in San Francisco. “And, as with Bitcoin, applying the disclosure regime of the federal securities laws to current transactions in Ether would seem to add little value.”
For me, this is not about Ether, but about the fact that a token can be used to raise capital (the “fundraising that accompanied the creation of Ether”) and at some point
I just wrapped up 2 days of speaking at MoneyConf in Dublin, an annual conference dedicated to all things fintech. In contrast to previous years, at least 50% of the programming involved blockchain technology. I shared the stage with two early FPV portfolio companies, Blockchain and Bitpesa, and connected with a number of old friends in the sector, including Ethereum co-founder Joe Lubin, academic and entrepreneur Emin Gun Sirer, and Circle founder Jeremy Allaire. We talked about the sector’s growth and challenges, tokenization, and regulation. There was little hype, real conversation and hyper-focus on overcoming current challenges and building what’s next. It was refreshing to be amongst the early adopters who keep it real, and I came away more convinced than ever that we’re in good hands…
Blockchain Week 2018 came in with a bang — 8500 attendees at the Consensus conference (vs 400 the last time I spoke there in 2015), thousands more at side events. The price of major cryptocurrencies saw a run up to the week, with vivid memories of the boom last year’s conference started. However, the prices soon came down, with Bitcoin trading near $7500 recently.
While the price may have disappointed, news continued to flow. Over the past few weeks:
Institutional grade security was high on announcement lists with Coinbase, Bitgo, and hardware wallet Ledger all announcing new custody products aimed at larger investors
Coinbase continued its acquisition spree, buying Paradex, a decentralized exchange (DEX — discussed in one of our newsletters earlier this year). This signals a closer move to offering altcoin trading, as Paradex focuses on the ERC-20 tokens that most initial coin offerings (ICOs) are built on
A few weeks ago, our portfolio company Coinbase announced that they had acquired a company called Paradex, which operates a 0x relay (in other words a decentralized exchange). If you want to know more about what all of that means, here is a video from Token Summit where it is explained in less than five minutes.
Non Fungible Tokens (or NFTs) are one of the most interesting things to emerge in the blockchain sector in the last year. Dieter Shirley came up with the ERC721 spec and the name and I talked to him about both and a lot more on stage at Token Summit last week.
If it seems like I am shouting every time I talk into the mic, I was. It was very loud in the room and I wanted to make sure people heard us. The video is about 30mins long and we covered a number of interesting topics.
It seems a whole new slew of phones that are optimized for blockchain applications are currently under development. Sirin Labs is going to debut its Finney phone in October 2018 which runs a custom Android OS. The phone will have built-in crypto wallets and will allow seamless behind-the-scenes conversions between different types of tokens. Blacture is also working on the Motif phone, which is supposed to launch in Fall 2018.
These are exciting developments, for sure. And while they might not make sense now, but don’t be surprised to see phone makers such as Apple start to incorporate chips and OS level integration for seamless behind the scenes conversions. For me, this is a trend to watch.
Coinbase started out as a place for individuals to buy, sell, and hold Bitcoin. They launched that in 2012.
In 2015, Coinbase added the GDAX exchange where institutions, other exchanges, and large traders could trade Bitcoin.
By the middle of last year, it became clear that many big institutions were entering the market and needed a lot more. And so Coinbase went back to the drawing board and developed a plan for a comprehensive suite of institutional products. And that is what they announced yesterday:
Coinbase Institutional Coverage Group
What started out as a simple web and mobile app for buying, selling, and holding Bitcoin has evolved into a full-fledged financial services company, serving
I am back in NYC after a trip around the world — with stops in London, Mumbai, Beijing, Korea, Los Angeles and Palo Alto along the way. I wrote about London and India observations in the last newsletter. A few takeaways on the rest: