A Practical Introduction to Blockchain

Marcus Erken
A Practical Introduction to Blockchain

All rights reserved - Marcus Erken, Sunfish Partners, 2017
The beginning
2
Source: The Economist, 2015

Nice to meet you
3
Sunfish Partners supports and
invests in early-stage startups in
the “world of data” (machine
learning, blockchain, IoT)

Disclaimer
4
This presentation is not intended as
investment, tax or legal advice and only
contains my personal opinions.
Cryptocurrencies and ICOs are risky. Never
invest more than you can afford to lose.
Always seek professional advice before
making any investment.

In-person exchanges are easy
5
Source: Coindesk, 2014

Digital exchanges are tricky
6

That’s why we need a trusted party with a ledger
7

Why not give this ledger to everybody?
8

The big two and why they matter so much
9
Source: Gatecoin, 2017

What are smart contracts?
10
Source: Blockgeeks

The benefits of blockchains (I/II)
11
Source: Deloitte
1. Trustless exchange
Two parties are able to make an exchange without the oversight or intermediation of a third
party, strongly reducing or even eliminating counterparty risk.
2. Empowered users
Users are in control of all their information and transactions.
3. High quality data
Blockchain data is complete, consistent, timely, accurate, and widely available.
4. Durability, reliability, and longevity
Due to the decentralized networks, blockchain does not have a central point of failure and is
better able to withstand malicious attacks.
5. Process integrity
Users can trust that transactions will be executed exactly as the protocol commands removing
the need for a trusted third party.

The benefits of blockchains (II/II)
12
6. Transparency and immutability
Changes to public blockchains are publicly viewable by all parties creating transparency, and
all transactions are immutable, meaning they cannot be altered or deleted.
7. Ecosystem simplification
With all transactions being added to a single public ledger, it reduces the clutter and
complications of multiple ledgers.
8. Faster transactions
Interbank transactions can potentially take days for clearing and final settlement, especially
outside of working hours. Blockchain transactions can reduce transaction times to minutes and
are processed 24/7.
9. Lower transaction costs
By eliminating third party intermediaries and overhead costs for exchanging assets,
blockchains have the potential to greatly reduce transaction fees.
Source: Deloitte

Blockchains can transform many industries - Examples
13
Source: SapHanaTutorial

Many startups have emerged already and more are coming
14
Source: CBInsights, 2017

What’s an ICO?
15
Source: Chipin, 2017

The biggest ICOs in 2017
16
Source: Crunchbase, 2017

Are ICOs an alternative to venture capital?
17
Source: CBInsights, 2017

How to buy & trade cryptocurrencies? Examples
18
Kraken
Bitcoin.de
Coinbase
Anycoin Direct
For fiat
Bittrex
Poloniex
Liqui
For crypto

How to store cryptocurrencies?
19
Exchange wallets
Software wallets
Mobile wallets
Hardware wallets
Paper wallets
low
.
.
.
security
.
.
.
high

 Use hardware or paper wallets
20
Source: Ledger Nano S – Ledger Wallet, 2017

Security round 1: What‘s the difference?
21
WHUrocks
.,v2.mZrEtYtAAxe?A;#@Zzh?ZrYk

Security round 2: What‘s the difference?
22

 Use random, complex passwords and never use them twice
23
Source: Passwordsgenerator

 Set up two-factor authentication
24
Source: Android Guys, 2017

There is no customer support hotline in cryptoland
25
Source: Slack Screenshot, 2017

Most days in cryptoland, it’s either all red…
26
Source: Coinmarketcap, 2017-09-15

… or all green  It’s a highly correlated asset class
27

On volatility – What a difference a day makes
28
Source: Coinmarketcap, 2017

The jury is still out on regulation (I/IV)
29
Source: SEC, 2017

The jury is still out on regulation (II/IV)
30
Source: TechCrunch, 2017

The jury is still out on regulation (III/IV)
31

The jury is still out on regulation (IV/IV)
32
Source: Bitcoin.com, 2017

It’s a polarizing topic
33
Source: CNBC, 2017

#wtf
34
Source: Bitcoin.com, 2017

 Understand people’s incentives & think for yourself
35
Source: Trustnodes, 2017

Market caps – cryptocurrencies
36

Market caps - stocks
37
Source: Statista, 2017

How much innovation will come out of the crypto universe?
38
5.5x
1,100+
cryptocurrencies

The best is yet to come
39
Source: Materna, 2017

marcus.erken@sunfish-partners.com
linkedin.com/in/erken
I’m always happy to help

A Practical Introduction to Blockchain

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