Friday, December 14, 2018

"Until next time" 👋

December 14, 2018

$133 Million in Funding Couldn't Keep This Startup Alive

Backed by giants

Notable names like Andreessen Horowitz, Bain Capital Ventures, Lightspeed Ventures, and GV opened their wallets for a whopping $133 million to help fund stablecoin startup Basis.

However, despite a sizable war chest and a myriad of well-known investors, the startup is now shutting its doors and returning money to investors.

What happened?

In the end, regulations won. That's because as the crypto startup began to build out its price stabilizing algorithm, it found out that its blockchain would fall completely under U.S. securities laws.

Due to this, part of the project would only be able to host accredited investors and Basis would have to enforce know-your-customer and anti-money laundering checks - two heavy asks for a "decentralized" cryptocurrency.

Taking initiative

According to reports, the team made the decision to discontinue before the U.S. Securities and Exchange Commission even had a chance to comment.

In closing, Basis CEO Nader Al-Naji signed off saying:

"You gave us the opportunity to change the world, and we're looking forward to trying again. Until next time."

ADOPTION

Overstock's Medici Ventures Wants to Create Blockchain Applications that are Actually Used

Overstock's transition to a blockchain company

Overstock has traditionally operated as an internet retailer selling discounted furniture, jewelry, and other products. As the retail segment of Overstock's business has struggled, the company's CEO Patrick Byrne has begun to shift his company to a blockchain-focused firm.

In 2014, Overstock created a venture capital arm called Medici Ventures. Recently, Overstock announced plans to sell off its retail business by February, which will only leave Medici Ventures and its blockchain portfolio.

Since 2014, Medici Ventures has invested more than $175 million in blockchain companies. Its most notable venture is tZero which is a security token offering exchange.

Focus on real adoption

Cryptocurrencies have received crazy valuations in the past couple years, many without any sort of a working product. Critics of the asset class often point to cryptos lack of actual use for why they are destined to fail. Overstock's Medici Ventures wants to change all of this.

Jonathan Johnson, president of Medici Ventures, said that 2019 is all about execution for the company. Medici Ventures will focus on investing in blockchain companies that are creating products that are ready for production and have the potential to change the world in the near future.

Johnson did say that the company retains a long-term view on blockchain technologies but emphasized the importance of results in the near-term.

Medici's president explained the company's mission:

"We want our portfolio companies to focus on having their products in production. When you have a product, it starts to open up the creative juices, [people start] asking 'how we can use it' and it changes the discussion. When it's mostly about technology, people want to talk about the Merkle tree, mining, nonces… All that talk gets confusing and in the way of progress."

RESEARCH

Number of Crypto Users Doubled in 2018 Despite Bear Market

According to research conducted by the Cambridge Centre for Alternative Finance, the number of verified cryptocurrency users doubled in 2018, from 18 million in 2017 to 35 million this year.

This massive growth is still a deceleration from the 4x growth from 2016 to 2017 but comes in the middle of a market that is down about 80% during the year.

Some are pointing to this data as an indication that the market has the potential to recover. In theory, more investors in the market result in more demand for cryptocurrencies.

NEWS

WallCoin, a Proposal for Trump's Mexican Border Wall

Border talk

There's a new proposal to fund President Trump's Mexican border wall and it's got crypto's name on it.

That's right. It's called Wall Coin and it's an idea that U.S. lawmaker Warren Davidson revealed in an interview with NPR's Steve Inskeep.

What's the purpose?

Raising money. Since Congress cannot agree on funding to build Trump's envisioned wall from his 2016 campaign, the government may shut down.

To overcome this issue, however, Davidson proposes that private citizens step up and contribute to the project themselves through a blockchain.

The donations would then return a cryptocurrency called Wall Coin to supporters.

Just a thought

There were no more details about Wall Coin. It could merely be Davidson "winging it" in the interview.

Although, Davidson is an outspoken supporter of cryptocurrencies in Congress and has even led a roundtable discussion including over 80 representatives to discuss initial coin offering (ICO) legislation.

BITS

But wait, there's more...

📈 LinkedIn reports that blockchain developer roles spiked straight to the top for most desired positions in 2018.
💳 Crypto-friendly fintech startup Revolut has obtained a banking license from the European Union.
⚡️ PwC has partnered with BitFury to create a blockchain accelerator in Russia.

MEME