Outlier Ventures Weekly Brief Issue #7|   View Online
A New Beginning
Hello and welcome back from the holidays. This week marks the tenth Birthday of Bitcoin. From Satoshi worrying about the network not being able to handle Wikileaks donations to ICOs, fork-wars and clones, we have come a very long way. The start of every year is one of predictions which rarely come true, alongside resolutions that are rarely met. Given the complexity of the industry, it helps to sometimes take a step back and look at the bigger picture, and what better time than the beginning of the year. The Romans named the month of January after Janus, the god of beginnings and transitions, also of gates, doors, doorways, endings and time. He is usually a two-faced god since he looks to the future and the past. So in today’s newsletter we do the same.

We start with Bitcoin. Jameson Lopp published a comprehensive collection of non-price related metrics from 2018. For instance, in comparison to only 136 academic papers mentioning Bitcoin in 2010, there were 14,400 papers listed on Google scholar this year.  Daily on-chain transaction volume saw a substantial dip as it swung from over $38 billion in early 2018 to a mere $3 billion by the end of the year. A similar trend was evident with average transaction volume as it dipped from over $100,000 to $10,000 by the end of the year. The post also notes that over $410 billion was transacted on the Bitcoin network or an average of $13,000 per second over the course of the year. Grab Jameson Lopp’s complete post here for more data on how Satoshi’s creation has evolved this year.

On to Ethereum. The token is back at #2 in terms of market capitalisation after an almost ~90% run-up in prices over the course of the last 3 weeks. Consensys published a post exploring network activity in early December. According to them, 2018 witnessed the Ethereum network seeing an additional 36 million new wallet addresses being opened. Excluding the top 50 wallets in terms of balance, the average wallet holds an approximate of 1.59 ETH. Average transaction count on the network has been at 600,000 each day since June. The post suggests that Ethereum currently has 11,000  active nodes interacting with the blockchain. Collectively, miners rewards are at an average of 620,000 ETH each month. It also claims a total of 1.5 million smart contracts deployed. Head over to Ethstats for more interesting numbers and grab the entire post by Consensys here. 

Chart source: Coinmetrics


Wading through the vast array of predictions, there are two pieces that stood out for the team at Outlier. Fred Wilson from USV gave a general overview of where equity markets are headed and how tokens may perform. He suggests that a key catalyst for the recovery of the market will be multiple projects from 2017 being able to deliver on their promises. He also indicates that over the course of the year, we may enter a new bullish phase for the token economy.

Arjun Balaji of Shomei Capital, released a HUGE list of predictions for the year taking a broad view across Bitcoin, regulation, token-funds and private projects. He suggests that it is likely that a low Bitcoin price could mean there may be more attempts to fork the coin in 2019. Forks will likely keep the core technology as they are attempt to change the monetary policy (eg: Satoshi’s 1 million coins) in an attempt to make a “Better” Bitcoin. He also suggests that Lightning nodes with channels will increase to well over 10,000 from 2100 currently. Our favourite prediction is below. Read the entire post here.

“31) A launch of Handshake (technical overview) could be an interesting 2019 development. Though I’m skeptical of their need for a token, replacing the ICANN root server is an interesting problem and it’s clear the current DNS/Certificate Authority system is broken. One potential 2019 development: Handshake serves as a crude but effective solution for sites with regulatory or speech-related risk, which is enough to serve as an effective bootstrapping mechanism.”

We will be releasing our latest State of Blockchains deck and some predictions from our team in the coming weeks so stay tuned!

Interesting Reads For The Weekend
1. Blockchain platforms to watch in 2019Link

2Why you are bad at predicting the future. - Link 

3. Why software is eating the world (2011) -  Link

4. FarnamStreet on mental models -  Link
Blockchain was first described in 1991, 28 YEARS AGO, as a timestamping technique.
PoW was first described in 1992, 27 YEARS AGO, as an anti-spam technique.
Tech breakthroughs don't happen over night. Be patient and keep building
    Email a Friend  
You can update your preferences or unsubscribe from this list
This email is intended only for the person to whom it is addressed and may contain confidential information. No one else may place any reliance upon, copy or forward all or any form of this email in any way. If any addressing or transmission error has misdirected this email, please notify us immediately by responding to us directly, and ensure that the email and any attachments are immediately and permanently deleted and is not used, disclosed, copied, printed or relied upon in any manner. In no event shall Outlier Ventures Operations Ltd or Outlier Capital LLP be liable for any direct, consequential, incidental special, punitive or other damages, whatsoever (including without limitation, damages for loss of business profits, business interruption, or loss of business information), even if Outlier Ventures Operations Ltd or Outlier Capital LLP have been advised of the possibility of such damages. Outlier Ventures Operations Ltd may monitor email traffic data and also the content of this email for the purposes of security.

Outlier Ventures Operations Ltd is registered in England and Wales, company registration number 10722638. Outlier Ventures Operations Ltd is an appointed representative of Sapia Partners LLP which is authorised and regulated by the Financial Conduct Authority (Firm Reference Number 550103).

Crypto-currencies can be extremely volatile and subject to rapid fluctuations in price, positively or negatively. Investment in one or more crypto-currencies may not be suitable for even a relatively experienced and affluent investor. Each potential investor must make their own informed decision in connection with any such investment (after having sought independent financial advice thereon).

The content provided in this email is provided for information purposes only. It is not intended as an offer or solicitation to enter into any proposed transaction or investment.

In this email you will find links to other websites; they are for your convenience or to provide additional information, they are not an endorsement or a financial promotion. Outlier Ventures Operations Ltd Is is not responsible for the any contents, data, opinions and or reliability of the linked websites, and does not necessarily endorse views expressed on the linked website, and does not accept liability for the accuracy or completeness of any such information or opinions which can be subject to change without notice.
You can update your preferences or unsubscribe from this list

This email was sent to <<Email Address>>
why did I get this?    unsubscribe from this list    update subscription preferences
Outlier Ventures Operations Ltd · C/O Milsted Langdon LLP · 46-48 East Smithfield · London, Middlesex E1W1AW · United Kingdom