Thread by @nlw

Long Reads Sunday #62

In the US, Labor Day is the end of summer & beginning of fall, so LRS is turning it over to @Travis_Kling @AriDavidPaul @tayvano_ & more to answer:

+what we learned
+what happens next
+what we’re not talking about enough

And of course: number go up?

2/ Question 1: So, what did we learn this summer?

Was it all just tribal infighting?
Were exchanges the whole story?
Did we really shift from bear to bull or are there still questions?

3/ For some, the story of the summer was exchanges. @mdudas @TheBlock__ said: "Exchanges are shipping at unprecedented rates. Binance has multiple releases weekly, Bitfinex and Coinbase have had multiple launches and these firms are expanding into staking, lending and more."

4/ @KyleSamani made a similar point, arguing that "Exchanges are the most dynamic area in crypto, both in terms of new entrants (Coinflex, FTX, etc) and market evolution (Bitfinex and Binance adding derivatives, BitMex)"

5/ @mayazi on the other hand had a bit of a counter point, arguing that this summer we learned that “IEOs are over and were a bear market phase.” What do you think? Exchanges the most powerful actor in crypto; IEOs dead; or both?

6/ Others focused on different themes. Many discussed the reasserted dominance of Bitcoin - or as @TheCryptoDog put it “Bitcoin is king, again.”

7/ @mccannatron echoed this "Bitcoin is still king and the dominate use-cases are still money, trading, and mining. While there are a lot of things happening in the smart contract space this summer felt more back-to-basics and back to more fundamental things."

8/ In that smart contract space outside of Bitcoin, meanwhile, @joonian argued that it was something new capturing people’s attention, saying that "DAOs are the new ICOs."

9/ Speaking of ICOs and dapps, @sassal0x wrote: "Most crypto-based apps are still trying to find product/market fit and breaking through to a mainstream audience is going to be much harder than originally thought."

10/ And speaking of attention, many argued that the most notable aspect of the summer was the new high level attention focused at this industry. @MessariCrypto’s @jpurd17 wrote "Powers that be: regulators, CBs, multinational corps are all being forced to start paying attention"

11/ @Travis_Kling echoed: "This summer we learned that crypto is moving front & center on the global stage. Jay Powell testifies about it. Trump tweets about it. Mnuchin gives press conferences on it. Congress holds hearings about it. We learned that regulators think BTC!=Libra."

12/ @jillruthcarlson agrees "Discussion of BTC has become a staple of Wall Street macro research pieces alongside gold & USD. Bitcoin correlations are on the rise. The best indicators of price may be keeping an eye on trade war tension, global interest rates, & USD strength."

13/ One reason for that new attention might be, as @MartyBent put it “The world is filled with more systemic risk than we could have imagined.”

14/ Question 2: Predictions for the fall.

It’s one thing to asset what’s already happened. It’s entirely something else to figure out what that means for the future.

15/ One of the big themes in the future predictions had to do with the global competition for digital money. @poncykiwi from the excellent CryptoAM newsletter predicts "China CBDC release gives other Central Banks cover to be more aggressive with developing models for theirs"

16/ @mccannatron agrees, but also thinks they may be missing something. "China's version of Libra will launch first and be much faster & aggressive with respect to distribution. However both of these efforts still miss the underlying premise that Bitcoin is a non-sovereign SoV"

17/ Following his assessment that we learned about more systemic risk last summer, @MartyBent thinks we see a European banking crisis this fall.

18/ According to @Travis_Kling "Many indicators tell that BTC is in ~ top of the 2nd quarter of a cyclical bull run, which will peak at prices meaningfully higher than $20k in next 12-18 mo. The biggest risk to this is traditional asset classes. Real stress there will hurt BTC."

19/ @PeterMcCormack, who noted pithily that “bear markets feel long, bull markets feel short” thinks this fall will be filled with “Lawsuits, big ass lawsuits.”

20/ @mdudas takes things in a different direction, focusing on likely product launches. "The rate of shipping from high-performing groups (Asian projects, exchanges, Ethereum projects, Lightning) will continue apace. Bakkt and TON will finally launch. 2019 is a year of building."

21/ @KyleSamani takes his prediction in a similar direction, although focusing on imminent platform launches: "A handful of the new smart contract platforms launch - Solana and Near specifically"

22/ @AriDavidPaul predicts we’ll see more attention returning to Dapps: "I expect growing attention on dApps with usage both within crypto communities and beyond. We may get some recognition from traditional gaming studios that there are now crypto games with 10k+ DAUs"

23/ @sassal0x gets even more specific: "The Ethereum-based game God's Unchained will bring more new people into the crypto ecosystem than any other dapp has so far."

24/ Finally, with little detail but much mystery, @jillruthcarlson predicted “the return of the ICO.” Might that growing dApp attention mentioned by @AriDavidPaul drive this?

25/ Question 3: What’s one thing we should be talking about more?

We can all get a little caught up in the dominant narratives, so I asked what else we should be paying attention to.

26/ Speaking of narratives, @tayvano_ things that bygone narratives should have more of our attention: "Why were older narratives, even dominant ones with longevity, lost? How? Especially narratives from 2008-2012."

27/ @propelforward, who had predicted “more regulatory enforcement” for the fall, suggested we should be looking at "The tensions created by concepts of on-chain ownership being linked to private key control & the extrinsic justice system's concepts of title ownership."

28/ Echoing all the predictions about CBDCs, @mayazi thinks we should be thinking more about the specifics of their models as well as “their impact on crypto adoption."

29/ Perhaps in a similar vein, @mccannatron argues for more focus on Asia. "Exchanges and trading infrastructure in Asia - which whether you like it or not drives the vast majority of trading volume in the crypto ecosystem."

30/ There was a variety of suggested focus around the alt coin ecosystem, although in some different ways. @Travis_Kling asks "Why can't the Alt ecosystem, with all the financial and human capital that's been poured in, produce anything that the real world cares about?"

31/ For those whose answer to that question is “DeFi,” @sassal0x writes that we should be paying attention to: Compounding DeFi risk (protocols built on protocols) and how to handle any critical incidents if they occur (such as the Maker system falling apart in some way).

32/ @poncykiwi writes "How do we create better risk models for DeFi so that we can lower the collateralization ratio; this will open it up more to people who genuinely can't access the current financial system.

33/ @poncykiwi continues "Generally - need to have a hard look at where crypto is actually improving people's lives and do more to support projects that are working on ways to empower this."

34/ This theme was reiterated by @TR401, who wrote: "We should be talking more about how crypto can help inner city and unbanked communities right here in the U.S.! The Venezuela talking point is getting old."

35/ @jpurd17 said something similar "We should really be talking about ways to educate the masses, not just writing good 101 medium posts but figuring out ways to structure courses or programs to get people learning from the best - @RussellOkung doing amazing job with @Bitcoinis_

36/ Others are looking at technical innovations that should be getting more attention. @KyleSamani says about @ArweaveTeam "It's the most interesting protocol in the file storage space, and totally underhyped."

37/ @AriDavidPaul also looks to the technical, saying we should have more focus on "Hybrid architectures. Projects like Decred that combined PoW and PoS, or projects like Hedera that combine public and private networks are kind of discussed as one-off experiments."

38/ @MartyBent meanwhile calls for more focus on "Security of Bitcoin's P2P network as evidenced by the recent discovery of the Erebus attack” and @TheCryptoDog gives a reason why "Politics & Crypto - they're only going to get more intertwined"

39/ Wherever the focus, most people are positive, as evidenced by @mdudas "The public drama that we see on Twitter isn't indicative of the state of the cryptocurrency ecosystem. There have never been more developers building more viable products at a faster rate."

40/ Question 4: Price of BTC at the end of the year: Up/Down/Sideways?

Admit it, you’ve been waiting for this one. No matter how much we care about the big ideas, we love that price action. So here we go.

41/ First, many of the respondents recused themselves from the question like responsible, lawful adults. @propelforward summed up this position: “You’ll get no financial or legal advice here!"

42/ Of those that did respond, not one person thought that the price would go down. I don’t know if this is because of a shared confidence in the fundamentals or suggests a serious shared conventional wisdom that practically screams for a contrarian bet.

43/ For those in the up column, many left it at that. @MartyBent ventured to say “Up, considerably” while @mdudas thought "Up slightly from the current price ~$10K. 2020 will be another year of significant price appreciation on the back of the new products being built in 2019."

44/ There were the few brave souls who hazarded a specific guess. While cautioning that his opinion was “very weakly held” @AriDavidPaul wrote "I expect general sideways consolidation for the next 2 months followed by a bull market that may have BTC end the year at around $13k."

45/ @Jillruthcarlson was on the same wavelength, making a bet that BTC would land at $13500.

46/ Finally, @Travis_Kling pegs the prediction to the Volatility Index: "Tell me where the VIX tops out between now and year-end, and where it ends at YE-19, and I'll tell you where BTC price will be."

47/ So there we have it! A recap of the summer, a look forward at the fall, a reminder of some important and under-discussed topics, and of course, dem juicy $$ predictions.

48/ As ever, the bitcoin and crypto space remains dynamic, volatile, interesting, and ever changing.

So now let’s throw it back to you: what did we learn this summer? What are your predictions for the fall? What should we be talking about more?

49/ Thanks as always for reading. You can get LRS via email at getrevue.co/profile/nlw