Category Archives: finance

thinking about crypto-tokens

First a disclaimer: I am not an expert on crypto-tokens and this post is not intended to offer advice about their relative merits or lack thereof.

I read from Fred Wilson’s blog today that there will be a “token conference” in New York this May. That of course, leads one to ask “so what the hell are tokens?”  H refers to what are generally called “crypto tokens”. They are a digitized form of token that are based on a  platform like bitcoin or etherium.  They are issued by someone either trying to finance or monetize a business.  Fred points out that the long-term upside is about monetizing a business rather than financing it.

What is the big deal? From TC, we find out that there be no big deal — at least not yet.

Many view ICOs and cryptotoken sales as fraudulent schemes for a quick money grab.

The main problem goes to the lack of enforceable mechanisms to control what happens after you buy the tokens. And that is a big issue. Read the TC article if you want more on that.

It is a big issue except if you have some basis to trust what is going on with those getting the funds from issuing the tokens. Which brings me to my point — stripped of all the rhetoric, we are seeing new platforms that build networks around evolving ideas. These are not easily financed by traditional methods. That is the “pull” that makes investing int his field interesting.

So hold on to your hat. You are going to hear more about this.


Bitcoin is not a coin

A lot of folks have given up on bitcoin as a currency. And perhaps they are right to do so. While the volume of bitcoin based transactions keeps going up, it is nowhere near replacing any major currency.

But what if bitcoin is not really a currency at all? What if it is something else. Something that we have never seen before? It has some properties of a currency, but it also has other properties that enable it to do stuff that currencies do not.

That is the idea that the folks at Polychain are betting on. They are investing only in companies that use digital tokens as the framework for their business. Read on if this idea catches your fancy!

Introducing Numerai

i will be the first to admit that I don’t really get this idea. I do get parts of it. But I will leave it to you to figure out how Numerai will achieve what it sets out to do.

This part I do get

What … components or technologies would be necessary for a global scale community of people making investment decisions?

Things start to get a bit fuzzy fo rme  when they talk about applying machine learning algorithms to anonymous data sets.

But hey, let’s see what it produces.


A Riff on Homomorphic Encryption

After reading this Wired article, I still am not sure what this is all about. here is a peek

Under the banner of a startup called Numerai, (Richard) Craib and his team have built technology that masks the fund’s trading data before sharing it with a vast community of anonymous data scientists. Using a method similar to homomorphic encryption, this tech works to ensure that the scientists can’t see the details of the company’s proprietary trades, but also organizes the data so that these scientists can build machine learning models that analyze it and, in theory, learn better ways of trading financial securities.

See what I mean? It is just a tough nut. Let me know if you can figure it out.

What will 2017 Hold for OPEC?

Oil prices have been historically low now for several years. How long will prices remain at these levels? No one knows. And if they stay at these levels throughout 2017? 2018?

Ouch! That will wreak havoc on the public finances of oil producers. Indeed, OPEC members are already feeling the strain. This story about Kuwait gives a glimpse.

This may be one of the more interesting stories to unfold next year. Stay tuned!

Are You Stressed?

Consider this bit of data

According to UBS research, 65%, 36%, and 22% of lower-, middle-, and higher-income cohorts are “stressed.” That means their income falls below or barely covers their expenses. And almost one in five stressed households, or 18%, agreed or strongly agreed with the likelihood of a default over the next year.

That more than 1 in 2 lower income groups are stressed is not a huge surprise. But the fact that nearly 4 in 10 middle income groups are stressed is a surprise.

It  could be trouble, depending on which direction these figures are trending.  It is worth keeping an eye on.