Outlier Ventures Weekly Brief Issue #27  View Online
What Is Decentralised Finance?
It has been a week of mixed emotions for the token ecosystem. On end, news has emerged of Facebook's "Project Libra" collaborating with the likes of Visa, Mastercard and Uber for their blockchain initiatives. On the other, altcoins seem to be in a downtrend due to Binance suggesting they may no longer be available for trading to US citizens. We are treading into a point in time where traditional, centralised entities and decentralised, permissionless systems compete with one another for market share. While only time could reveal who would be the clear winner, we have research that explores how each of these trends would evolve. The week's newsletter explores decentralised finance, the economics of queuing and Mary Meeker's latest report. 

Image: Sourced from Dai In Defi
Percentage call-outs indicate stability fee adjustments on Dai

Mapping Decentralised Finance
Decentralised finance has roughly about $500 million in liquidity today. What was initially merely experiments in creating stable units of currency is today a full fledged ecosystem that provides tools for everything from fund management to payments. Ethereum based smart contracts has enabled the creation of an entire financial ecosystem that is readily available at the click of a button. It may be buggy at times, but it is here and evolving. Our latest report from Lawrence Lundy-Bryan and Joel John explores how the space is evolving and the key projects within it. We lay a basic definition for what could be considered “decentralised finance” and differentiate it from open-finance. Read the entire report here for more on the emergent trend and how we see it evolving. 

On the Economics of Queuing and its Impact on Blockchain Technology
Queuing is a crucial aspect of modern societies. It defines how resources are delivered for everything ranging from public goods to network resources. One way they run efficiently is through fee structures that incentivise individuals that are willing to give up an immediate benefit for longer wait times. Fee structures on proof of work blockchains imitate this. Those that wish to hold on to their precious tokens often pay lower fee for longer confirmation time and those that seek quick confirmations pay a higher fee in tokens. This could be exploited to attack a network. Ethereum and Bitcoin have witnessed many of these over the course of the past few years. Given that scalability is a key element for the growth of the ecosystem, it is detrimental to explore how it can be done efficiently. Jonathan Ward - Head of Research at recently explored this post in this matter in his post. Read it here for more on how queuing affects blockchains.

Mary Meeker Releases Latest Internet Trends Report

Mary Meeker’s annual reports have been the go-to source for over twenty years for internet-based businesses to update themselves on the key macro trends affecting the industry. This year’s report was released earlier this week and it has quite some interesting numbers in it. For instance, internet growth has now reached 50% of the global population and may struggle to find avenues for further expansion. There is a similar on-going trend with global phone user bases. How would this affect digital media consumption? Would it affect the digital advertising industry? Read the entire report here to catch up on what the trends suggest. 

Get Involved

If you are looking to engage with our Diffusion Program please get in touch with the respective contacts below:

What The Team Is Reading
If you insist on claiming it’s impossible to compete with tech giants and they can easily crush startups in unrelated businesses, you should post it on Orkut and see where it ranks in Bing search results. Happy to discuss further on Wave.
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