Crypto Newsletter 1/16: Occam’s Razor

StartEngine Stories February 8, 2019


Crypto Newsletter 1/16: Occam’s Razor

Ethereum Classic’s 51% attack this week resulted in $1.1 million in losses. The price of ETC eventually stabilized at over $4, about a dollar less than its price before the attack. The cyber-attack is the latest piece of bad news in a string of downturns that have befallen blockchain throughout the past year.

Yet as we move through winter, both literally and metaphorically, it’s important to remember that data suggests that we are overusing the word “bubble” when it comes to market downturns. In one of Collaborative Fund’s blog posts, author Morgan Housel writes that what most call market bubbles are in fact just regular cycles of capitalism. Instead, Housel believes “it’s only a bubble if return prospects don’t improve after prices fall. It’s when an asset class offers you no hope of recovery, ever.”

In blockchain’s history, we’ve seen Housel’s cycle of capitalism many times as the market course-corrects only to bounce back. We can take comfort in knowing that there is no clear proof that this winter is anything more than that: a brief season in blockchain’s life that soon enough will turn as all seasons eventually do.

What’s Happening In the News

1) Regulated Platform Executes First Security Token Trade

At the end of last week, SharesPost announced that they have successfully facilitated the first secondary trade of security tokens on its ATS, with Blockchain Capital’s BCAP Tokens.

2) Bakkt Takes One Step Forward, One Step Back

In the fallout of the US government shutdown, Bakkt’s launch will be delayed again as they have yet to receive regulatory approval for the platform. On the positive side, Bakkt announced its acquisition of Rosenthal Collins Group, an independent futures commission merchant, to strengthen their compliance team.

3) Malaysia to Regulate ICOs

The Malaysian government announced this week that starting January 15th, ICOs would be regulated as securities offerings and require the approval of Malaysia’s Securities Commission before launching.

Articles We Read (And You Should Too)

1) Occam’s Razor

In a McKinsey report, three partners at the firm dive into blockchain’s trajectory and ask a simple question: if the problem-solving principle of Occam’s Razor holds true, that the simplest solution to a problem is the best one, then what future is there for a technology so complicated?

2) Howard Marks Guests on Self-Made Man

StartEngine’s co-founder and CEO Howard Marks talks about his career at Activision before diving into the future of finance and where blockchain technology goes from here.

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