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New Developments in Blockchain, Cryptocurrencies and ICO's- Feb. 6, 2108
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February 6, 2018 - New Developments in Blockchain, Cryptocurrencies & ICOs Transcript


 

Carmen Palafox:

We held this event called New Developments in Block Chain ICOs and Cryptocurrencies to really address the latest trends in this space. We had an awesome panel going on. We had speakers talking about ICOs and why they failed. The challenges of developing on top of block chain and the legal regulatory landscape. We also had an investor panel, very experienced and knowledgeable investors talking about trends in their space.

Alex Nascimento:

I teach at UCLA Business Applications for Block Chain and our idea is to educate people and bring people to an understanding of what's going on in the market. I think that we see a vast demand for the subject, people all the way from the investment side, but also from the development side. There is a huge opportunity now for developers to get up to speed in to how to code and develop these centralized applications on the block chain. So a lot of what we get is a mix of people that are trying to understand the technology, trying to understand how to potentially invest, and also how to code and develop on block chain.

Elmer Morales:

I'm personally interested in block chain as a underlying platform for new software technologies. So historically I've worked a lot with large enterprise companies and so helping them adopt block chain technology to improve their services and lower costs is what I'm interested in.

Carmen Palafox:

We're very interested as hardware investors in the intersection of hardware and block chain, so distributed networks and security, how to make the internet of things more secure and how to address supply chain issues with block chain.

Elan Mevasse:

I think the most interesting thing for me in terms of block chain would be the definitive identity. I think something that block chain offers an opportunity for is for us to truly identify consumers, whether that's in a banking transaction or even a contractual situation, if I can verify that John Doe is John Doe, and Jane Doe and Jane Doe, and any type of crypto currency that can leverage that and bring that to life, I'm interested in.

Roger Royse:

So certainly I am very interested in block chain, I think that's going to revolutionize a lot of the verticals that we're pretty active in. Just yesterday I met with two companies that are using block chain for agricultural traceability purposes. I mean the possibilities are really sort of endless the more we think about that. As a lawyer, I can tell you it's going to change the way we do business as well. These are tools that are going to make everything different I think in the future.

Alex Nascimento:

Taxation and cryptocurrency goes along the lines of regulation right? I've actually been doing a little bit of a world tour trying to understand regulations in different jurisdictions and I believe that this is the year of regulation. Corporate is coming, institution investors is coming, regulation is coming. And in my view, regulation is really good because it will bring more liquidity to the market. Would you rather put your money in a company you know of, or you don't know who it is the founders, or they have not been regulated or would you rather have things like FDIC and other forms of regulation making sure that your money is safe? I rather have a regulated environment where I know that there is at least some level of security of where my money is sitting at.

Roger Royse:

The tax problem is way bigger than I think people appreciate it. The IRS a few years ago has determined that crypto is property, which means every time we use it, we've got a taxable sale or exchange. The IRS has managed to do a John Doe summons of coin base and now every transaction of more than $20,000 has to be reported and people like most of us will use wallets like that, where the IRS is all over it now, and there's going to be reporting. So I can understand why people might be trying to do things to avoid tax on crypto.

Tyler Callaghan:

I think the general consensus with securities token now is pretty much all ICOs that are issuing securities token or issuing tokens in general are securities tokens. Utility tokens really have a defined service involved, whether it's one utility token equals on bottle of water. Security token really has equity within the business.

Alex Nascimento:

Generally a presale is where you get a discount to buy a specific share of that project, and then when it goes into sale, you get to the regular price and then hopefully further on that share that you have on that project is going to hit the market and is going to have an appreciation. So that's the idea. So a lot of people try to get into the pre-sale so that they get a significant return in a short period of time. But it is important again to do your own due diligence and to read as much as possible before you commit to any investments.

Roger Royse:

The way most of the companies we're seeing are set up, is they ideally they have an existing business, maybe they don't, but they do need to raise some money to fund, to build out the platform. And that's the presale and we're seeing most of those done through what we call a SAFT, a simplified agreement for a future token. It will raise maybe a million dollars we'll say. Under the simplified agreement, that first million dollars will be, will guarantee the owner a discounted price on the tokens when they get issued in the ICO. They'll use the million dollars to help build out the platform and do the ICO launch. So that's the typical structure for a presale.

Elan Mevasse:

We have an index such as the Dow that gave us a sense of the strength of the economy. Later in the 90s we had the dotcom boom and I think the question around it is, what does this represent in this block chain, bitcoin eco system? And I do think we're going through a separate paradigm shift. And I think the exciting part is nobody knows where it's going to go. I don't know if this is going to be a permanent change like Americans eat organic, or if this is going to be something like the high carb diet that disappeared over night, and that I don't have an insight into.

Alex Nascimento:

Cryptocurrencies have been very resilient, if you look at the long term of the graph it has only gone up. There is some spikes downs and there is volatility in the market because of uncertainty, may only we see a reflection of what's happening in the stock market in the US, which is the main market in the world. We also see a fear of regulation that's coming out of South Korea. And China is also looking at completely banning exchanges. Another factor that I think was relevant in the latest drop into the price of various cryptocurrencies is Lloyds Bank in England which disallowed or eliminated the ability of you to use a Lloyds credit card to purchase cryptocurrencies. So those things combined, but may only as a reflection of the decline in the US stock market, would be my explanations of what you've seen lately. But I'm bullish that it will go back. And since from yesterday it's going up again.

Elmer Morales:

China blocking access to some of the exchanges, I think it will have a small impact. But I think people will figure out other ways of going around the blocked sites. There's a lot of money coming in from Korea and other parts outside of China as well, so I think there will be a small dent in the short term, but long term I think the market will figure it out.

Roger Royse:

I just don't think government is going to be able to stop this. They'll stop it in the short term through things like that. But in the long term, this is like prohibition, right? Look how well prohibition worked in stopping the sale of alcohol. And this reminds me a lot of that. Look at what's going on recently in cannabis. When enough of the population really wants something it's going to happen. It'll happen a little more slowly in some of these other countries that are more restrictive, but eventually the technology will find a way around it.