VeradiVerdict - Ethereum 2.0 - Issue #10

VeradiVerdict

Hi, I am Paul Veradittakit, a Partner at Pantera Capital, one of the oldest and largest institutional investors focused on investing into blockchain companies and cryptocurrencies. I focus on early investments and want to share my thoughts and what’s going on in the industry in this weekly newsletter.


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Editorials

This past week was the tenth anniversary of Satoshi’s whitepaper. It also brought some exciting news on Ethereum. JP Morgan announced that they had created an enterprise version of the ethereum blockchain, and Vitalik Buterin also signaled to us that a switch to proof-of-stake is “no longer so far away”. Here’s the video.


At Devcon 4 in Prague, Vitalik reviewed the series of integrated or abandoned efforts that led Ethereum to where it was. He then outlined the path to Ethereum 2.0, dubbed Serenity, which would be the final phase of Ethereum’s development roadmap, bringing Ethereum from proof-of-work(PoW) to proof-of-stake(PoS).


With PoW, miners solve cryptographic puzzles to mine blocks to the blockchain. These puzzles become harder over time, requiring input of a lot more energy and expensive hardware. This leads to waste of resources and inefficiencies. Moving to PoS means that validators(not miners) will validate blocks by putting their Ether as a stake. If they bet on the wrong block, their Ether will be gone. The Casper protocol is a particular implementation of PoS for Ethereum, and would serve as an intermediary step in Ethereum’s transition from PoW to PoS.


In addition, Serenity will institute sharding, which would help to solve the scalability bottleneck that plagued Ethereum as it is. Ethereum’s main chain will be divided into separate chains, or shards, that associate with each other as well as the main block. Sharding provides parallel processing of transactions, increasing the transaction speed of the network several folds.


Digests

Morgan Stanley Report Says Crypto Now An Institutional Asset Class

Institutional investors are increasingly getting involved in bitcoin and other cryptocurrencies – while the number of retail investors in the space is staying stagnant – according to a new report by Morgan Stanley.

Writing and publishing code alone cannot be a crime

A recent speech from a CFTC commissioner is concerning for free software development

In the Tweets

Francis Pouliot

@francispouliot_

How I fooled people into thinking I can code:

- Bitcoin SaaS API docs
- trying APIs w/ Postman
- Bitcore playground
- electrum console
- bitcoin.js and trezor command-line
- https://t.co/tlnGRD0nb2 and https://t.co/PaNVs2pdzc
- @opentimestamps
- wikipedia
- mastering Bitcoin https://t.co/7agbRF3CgZ

6:15 AM - 5 Nov 2018

Emin Gün Sirer

@el33th4xor

All crypto benchmarks that report more than a few hundred TPS should be considered suspect. Case in point:

Wait A Minute, EOS Is Not A Blockchain? https://t.co/HCKVvzwIEG via @zycrypto

5:23 PM - 4 Nov 2018

Larry Cermak

@lawmaster

Hinman, who previously stated that Ethereum isn't a security, said today at a conference that any token that has an expectation of return is generally going to be seen as a securities offering by the SEC. This tells me that both XRP and BNB are textbook securities. https://t.co/quLUzo1m2Q

9:44 AM - 5 Nov 2018

News

JP Morgan's Quorum blockchain opens new world of trading opportunities

JP Morgan is using a blockchain to “tokenise” real assets, suggesting the emerging technology could radically change global capital markets.

Israeli Startups Raised $600 Million Through ICOs in 2018: Report

Israeli startups have brought in more than $600 million in funding from initial coin offerings (ICOs) in the first three quarters of 2018, according to an industry report.

Bithumb, SeriesOne to Launch Security Token Exchange in the US

South Korean crypto exchange Bithumb has teamed up with crowdfunding platform seriesOne to launch a compliant security token exchange in the U.S.

Elon Musk Impostors Score $176K (And Counting) in New Twitter Scams

A number of verified Twitter accounts were compromised Monday – including those owned by a U.S. lawmaker, a film company, and a book publisher – all to impersonate SpaceX and Tesla founder Elon Musk.

Basic Attention Token (BAT) is launching on Coinbase Pro

After 1pm PT on Friday, November 2, we will begin accepting inbound transfers of Basic Attention Token (BAT) to Coinbase Pro. We will accept deposits for at least 12 hours prior to enabling trading…

Zcash's Next Upgrade to Make Private Transactions 100x Lighter and 6x Faster

Zcash’s core differentiator, shielded transactions, are computationally heavy – so much so that most users and exchanges can’t support it.

Regulations

Hong Kong's Securities Watchdog to Regulate Crypto Funds

Hong Kong’s Securities and Futures Commission (SFC) says it will bring crypto funds under its securities regulations to improve investor protection.

Swiss Finance Watchdog Tells Banks to Treat Crypto Trading As High Risk

Switzerland’s Financial Market Supervisory Authority (FINMA) is giving tough guidance to banks wanting to trade in crypto assets.

China's Central Bank Moves to Restrict Free Crypto Giveaways

The People’s Bank of China (PBoC), the country’s central bank, is looking to clamp down on airdrops – free distributions of crypto tokens.

New Products and Hot Deals

Ethereum Energy Project Now Powers 700 Households in 10 Cities

Launched earlier this year, Lition is already a licensed energy supplier in Germany with clients in 12 major cities (including Berlin, Hamburg and Munich) who are now using its decentralized energy market. Built on top of the ethereum blockchain, the Lition market connects consumers directly with energy producers big and small.

Apps for Kik's Crypto Are Beginning to Appear on Apple and Google Stores

The number of mobile apps built around kin – the cryptocurrency created and launched by mobile messaging app Kik – is growing.

Cute Cats Power Serious $15 Million Funding for CryptoKitties Creators

The company behind the viral blockchain phenomenon CryptoKitties is planning to enhance its platform – and it’s received backing from some major tech firms to do it.

Coinbase's Emilie Choi: $300 Million Raise Was 'For a Rainy Day'

With its latest funding round, Coinbase, the cryptocurrency exchange turned Silicon Valley unicorn, is amassing a “war chest” for a “rainy day.”

StarkWare closes $30M Series A led by Paradigm – StarkWare Industries

We’re happy to announce that StarkWare recently closed a $30M equity round, led by Paradigm. Other new investors include Intel Capital, Sequoia, Atomico, DCVC, Wing, Consensys, Coinbase Ventures…

RCN + Decentraland: introducing virtual land mortgages

Decentraland is a virtual reality platform built on top of the Ethereum network, making it possible for individuals, brands, and studios to develop rich, interactive 3D content hosted on

Meet with Me

I will be traveling this fall for certain events, and to meet with investors. Let me know if you and your colleagues would like to meet in person.


Macau, Sora Summit, November 13

New York, Consensus Invest, November 27