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Signal to Noise 005: Square, Ethereum, JP Morgan, and Buffet

David Nage
May 5, 2019
Welcome to the third edition of Signal to Noise where I attempt to break down the headline news of the week and put it into two piles:
 
  • Signal: denoting it may affect and incite action in the crypto market & ecosystem
  • Noise: denoting material which interferes with said action, but yet seem to take up our attention & mental space.
A quick note: The content provided in Signal to Noise is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. Nothing contained in this blog constitutes a solicitation, recommendation, endorsement, or offer by Arca to buy or sell any securities or other financial instruments in this or in in any other jurisdiction.

Signal
In this section, you'll see news and research regarding Institutional Investors investing & focusing on crypto, products/platforms shipping and launching, Corporations getting involved in the ecosystem, job moves into crypto and much more.
 
Square reported $65.5 million in bitcoin revenue for the first quarter of 2019. Bitcoin profits in Q1 2019 represent an 80% gain over the prior quarter. For all of 2018, the company reported $166 million in bitcoin sales. To say this continues to be an important narrative in the growth and adoption of Bitcoin is an understatement, in my opinion, - Square, Cash App on familiar “on-ramps” like these are incredibly important to remove the friction of adoption.
 
During a bi-weekly call between Ethereum developers and Ethereum Foundation researcher, Justin Drake, it was stated that code specifications for the first phase of Ethereum’s transition to a proof-of-stake network were “on track” to be finalized by June 30. According to Vitalik, the two major upgrades are:
  1. Casper, a proof-of-stake algorithm which replaces mining
  2. Sharding which “is this massive scalability improvement which happens because you don’t need every computer in the network to process every transaction in the network anymore”.
To see the continued efforts of Ethereum, which currently has approximately a market cap of around $17-18B, is positive in my opinion.
 
According to the survey, about 22% of institutional investors already have some exposure to digital assets, with most investments made within the past three years. Four in ten respondents say they are open to future investments in digital assets over the next five years. More than 400 U.S. institutional investors were surveyed, including pensions, family offices, crypto and traditional hedge funds, financial advisors and endowment and foundations.
 
The global head of agency collateral management at JP Morgan Chase left the company to join the crypto startup, Tradewind, as the firm's CEO. Albanese is a 23 yr veteran on Wall Street having spent 15 years at JPM and 8 years at Credit Suisse.
 
Noise
In this section you can anticipate news and research that does not discuss building or investors coming into the ecosystem via investment or careers, but rather focuses on price, predictions of price and more. Aside from price prognostications and everyone thumping their chests that Bitcoin hit $6000 (yes I’m happy about it but again, price in my opinion is now a leading indicator of things to come) there are some other pieces of “news” that I feel deserve to be tuned out:
 
Satoshi Website Triggers Countdown to ‘Live Unveiling’ of Bitcoin Creator
A new website is making the rounds on the social web, stoking speculation about what it could mean for the mystery of Satoshi Nakamoto. Gotsatoshi.com launched  this past weekend with no hint of who built the site or the reason behind it. This, in addition to the reports a few weeks back that John McAfee was going to unveil Satoshi's identity, do nothing for the overall growth, adoption and interest in digital assets.
 
Warren Buffett says Bitcoin is a 'Gambling Device' with a Lot of Frauds Connected with It.
"I'll tear off a button here. What I'll have here is a little token...I'll offer it to you for $1000, and I'll see if I can get the price up to $2000 by the end of the day... But the button has one use and it's a very limited use," Buffett said.
 
And there you have it, another week, another bunch of signals and noise. As always if you have news/articles that you feel are either signal or noise let us know!
 
 
To learn more or talk to us about investing in digital assets and cryptocurrency
call us now at (424) 289-8068
 

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