last cape town tour (iv). today: cryptocurrencies › 2017 › 12 › el… · blockchain is the...

Eleonora Escalante MBA-MEng, Strategic Corporate Advisory Services

© 2017 Eleonora Escalante-all rights reserved 1

Last Cape Town Tour (IV). Today: Cryptocurrencies

6Dec2017

Cryptocurrencies,

A new money model for the future?

Or just an experiment?



Cape Town Picnic (IV): Cryptocurrencies

9Dec2017

New Industry model

Version 4.0Manufacturing:

Basic goods /

advanced

Chemicals and

Pharma

Mining and

Extractive

Industries

Transportation

and Logistics

Warehousing

Real Estate and

Infrastructure

Construction

Agriculture and

Food Security

Oil & Gas ICT Media

Entertainment

and Recreation

Hospitality Trade-Retail and

Wholesale

Financial

Services

Utilities

Healthcare Education Government Professional

Services

Personal & Local

Services

• Again, as the machines and

petroleum revolutionized the

world almost a century ago, the

new digital emergent

technologies are transforming the

society through a new

industrial version 4.0• At least 20 grand economic

sectors or industries will be

affected

• We are building a new prototype

version of our humanity.

• It is natural to think to change

the actual currency system.

https://support.office.com/es-ES/article/b89770f1-deb1-4a19-94ef-342aa15a4689



Cape Town Picnic (IV): Cryptocurrencies

9Dec2017

New Industry model

Version 4.0

• The transformation of the

industries is happening

because we have understood

the importance of data

analysis.

• Digital technologies and

other innovative emerging

technologies give us DATA.

Plenty of DATA.

• Data to be gathered,

segmented, analyzed.

• Decision making based on

data, is faster, is more flexible

and more efficient.

• Produce higher quality goods

and reduced costs


Cape Town Picnic (IV) : Cryptocurrencies



Cryptocurrencies

9Dec2017

New Industrial Version 4.0 of our Society

New

Technology

Innovations

New Currency

Innovations

New Mindset

• Cryptocurrencies

• E-commerce Transactions

• Wallet

• Payments

• Exchanges

• Mining-Securing ledgers

• New Digital Skills

• Enabling digital education

• Enabling digital workers

• Digital Capital deepening

• Digital Employment

• Big Data

• Artificial Intelligence (AI)

• Automation and Robots

• Simulation

• IoT and IIoT

• Cybersecurity

• Fintech

• Augmented Reality

• Digital Analytics

• Etc, etc., etc…

• For more technologies

visit Gartner.com

The context of emerging cryptocurrencies


Cryptocurrencies




9Dec2017

• Cryptocurrencies are the result of a combination of multiple

achievements in various disciplines that include, but are not

limited to computer science (P2P networking), cryptography

(cryptographic hash functions, digital signatures) and economics

(game theory).

• There is no central authority that governs the system; instead the

rules governing the system (e.g., defining what constitutes a valid

transaction, specifying the total supply of the digital token and its

issuance scheme, etc.) are enforced by all network participants

(also called ‘nodes’).

• Anybody is free to join and leave the system at any time, and there

are no identities attached to users.

• There are more than 1337 cryptocurrencies, being Bitcoin the

most important oneBitcoin remains the dominant cryptocurrency in terms of market capitalization, Source:

2017 Global Cryptocurrency Benchmarking Study.

Why do cryptocurrencies have emerged?


Cryptocurrencies




9Dec2017

• The entire transaction history

can be independently verified

by each node as everyone has

a copy of the shared ledger.

• This shared ledger, generally

taking the form of a chain of

blocks comprised of

transactions (‘block chain’), is

constantly updated via a

process called ‘mining’,

through which new units of

the native token (i.e., the

cryptocurrency) are created. Source: Aswath Damodaran, Finance Professor NYU. The Crypto Currency Debate: Future of Money or

Speculative Hype?. August 2017

Blockchain is the base for Cryptocurrencies


Cryptocurrencies




9Dec2017

As of Dec 8, 2017

Price: $15123.60

Bitcoin value (December 8th, 2017)


Cryptocurrencies




9Dec2017

Aswath Damodaran, Professor of Finance at the Stern School of

Business at NYU.

• “Crypto currencies, with bitcoin and ether leading the pack, have succeeded in

financial markets by attracting investors, and in the public discourse by garnering

attention, but they have not succeeded (yet) as currencies.

• I believe that there will be one or more digital currencies competing with fiat

currencies for transactions, sooner rather than later, but I am hard pressed to find a

winner on the current list, right now, but that could change if the proponents and

designers of one of the currencies starts thinking less about it as a speculative asset

and more as a transaction medium, and acting accordingly.

• If that does not happen, we will have to wait for a fresh entrant and the most

enduring part of this phase in markets may be the block chain and not the

currencies themselves”.

What the experts say about cryptocurrencies?


Cryptocurrencies




9Dec2017

Joseph Stiglitz, Columbia University, Nobel Laureate.

• Nobel Prize-winning economist Joseph Stiglitz said

“bitcoin is successful only because of its potential for

circumvention, lack of oversight.”

• “So it seems to me it ought to be outlawed.”

• “It doesn’t serve any socially useful function.”

• “It’s a bubble that’s going to give a lot of people a lot of

exciting times as it rides up and then goes down.”



Cryptocurrencies




9Dec2017

Robert Shiller, Sterling Professor of Economics, Yale University and

Nobel Laureate 2013.

• “Bitcoin is the best example today of a speculative bubble, at least as I

define a bubble. But the Bitcoin events clearly fit this definition, in

2013 in the original flush of excitement for Bitcoin, and then, after a

temporary collapse in Bitcoin value, again now in 2017.

• The 2013 rise in value of Bitcoin was driven by some basic stories that

have great resonance: a new currency that lives in cyberspace without

government interference or control. It appeals to independent-

minded young people who find government regulations boring and

intrusive…. In 2017, the second rise in Bitcoin appears to have

something to do with the appearance of ICOs, initial coin offerings,

which give Bitcoin an investment banking patina too”.



Cryptocurrencies




9Dec2017


Professor Shiller defined a Bubble in his

book Irrational Exuberance in 2005, as “a

situation in which news of price increases spurs

investor enthusiasm, which spreads by

psychological contagion from person to person,

in the process amplifying stories that might

justify the price increases, and bringing in a

larger and larger class of investors who, despite

doubts about the real value of an investment,

are drawn to it partly by envy of others'

successes and partly through a gamblers'

excitement.”


Cryptocurrencies




9Dec2017

My personal opinion about Cryptocurrencies.

• It is a nice try. I see bitcoin as the first currency prototype after Satoshi Nakamoto's

discovery in the year 2008. Bitcoin is one in between 1337 other initiatives.

• Money is about “trust and faith”: If there is no trust in Bitcoin or other cryptocurrencies, we

are still in the stage of testing and building a digital currency prototype.

• I see it as an innovative experiment. There is a curious motivation to find a new currency

based in the new technological platforms and advancements.

• If we have not invested in bitcoin or other cryptocurrency, I don´t see the point to worry

about something which is not going to affect us directly.

• In addition, the cryptocurrencies have not been tested by any government, neither

accepted by the global financial sector yet.

• There is a lot to learn in the process to create a digital currency. If one cryptocurrency will

be accepted by the financial services sector, there is a lot to learn more. “New analytical

tools and surgical automation can be used to take the fight to fraudsters and be more

efficient with anti money laundry measures”.

• Personally I will be cautious to accept a new currency that is not a diamond yet. It needs to

be polished. And it is not regulated. I do not want the Grinch to steal our Christmas.


“Cryptocurrencies are a nice try. Personally I will be cautious to accept a new currency

that is not a diamond yet. It is still a work in progress and needs to be polished. It is not

regulated neither accepted by the global financial industry. I do not want the Grinch to

steal our Christmas”. Eleonora Escalante




9Dec2017

Thank you!


last cape town tour (iv). today: cryptocurrencies › 2017 › 12 › el… · blockchain is the...

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