Cryptocurrencies & Blockchain - Initio Knowledge Sharing
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The document provides an overview of blockchain technology and cryptocurrencies. It analyzes transaction speeds, fees, and market caps of the top 15 cryptocurrencies. Bitcoin is described, along with opportunities in blockchain like digital currency, securities, and record keeping. Graphs show Bitcoin has the highest fees and low transaction speed compared to other cryptocurrencies. The rest of the document discusses arbitrage opportunities in cryptocurrency exchanges, emerging opportunities in futures contracts, and credentials of blockchain consultants at Initio Knowledge Sharing.
Cryptocurrencies & Blockchain - Initio Knowledge Sharing
- 1. Initio Knowledge Sharing (IKS) « Cryptocurrencies & Blockchain » Blockchain Task force (07/02/2018)
- 2. Blockchain technology offers a range of opportunities 03 Benchmark analysis of transaction speed and fees 05 Bitcoin in brief, a key figure summary description 06 Gainers and Loosers: average Transaction Fees 07 Gainers and Loosers: TPS 08 Strategic analysis of Bitcoin 09 A Bitcoin/Blockchain SWOT analysis 10 Bitcoin has been a game changer. What about the rest?... 11 Portfolio management opportunities 12 2 WWW.INITIO.EU Contents
- 3. Blockchain technology offers a range of opportunities « The Blockchain Fingerprint » 3
- 4. Blockchain technology offers a wide range of opportunities « The Blockchain Fingerprint » Digital Currency • E-commerce • Global payments • Remittance • P2P lending • Microfinance Securities • Equity • Private markets • Debt • Crowdfunding • Derivatives Record Keeping • Healthcare • Title records • Ownership • Voting • Intellectual property Smart Contracts • Digital rights • Wagers • Escrow 4 WWW.INITIO.EU
- 5. Benchmark analysis of transaction speed and fees « Bitcoin vs other crypto-currencies » 5
- 6. Bitcoin in brief, a key figure summary description « Comparative analysis of the 15 biggest crypto-currencies » WWW.INITIO.EU 6 7 Transaction per seconds (TPS) 168 Market value in USD million D e c e n t r a l i z e d Type of organization structure 6.19 Average transaction fee in USD
- 7. Gainers and Loosers: average Transaction Fees « Comparative analysis of the 15 biggest crypto-currencies » WWW.INITIO.EU 7 Name Market Cap (USD) Transaction fees Bitcoin 168,077,000,266.00 6.1900 Monero 4,272,973,220.00 5.8700 Lisk 3,050,296,041.00 1.7950 Ethereum 106,706,653,950.00 0.8130 Dash 5,350,528,925.00 0.5450 Litecoin 8,757,735,261.00 0.2250 Bitcoin Cash 25,026,143,518.00 0.1150 Cardano 12,921,792,685.00 0.0542 Ripple 43,195,306,409.00 0.0038 TRON 3,369,259,549.00 0.0001 Stellar 9,205,904,704.00 0.0000 NEO 9,135,230,000.00 0.0000 EOS 7,290,084,536.00 0.0000 NEM 6,682,562,999.00 0.0000 IOTA 6,177,228,101.00 0.0000 THE BIGGEST CRYPTO CURRENCY HAS THE HIGHEST LEVEL OF TRANSACTION FEES Source: Coinmarketcap (Market Cap figures)
- 8. Gainers and Loosers: TPS* « Comparative analysis of the 15 biggest crypto-currencies » WWW.INITIO.EU 8 THE BIGGEST CRYPTO CURRENCY HAS ONE OF THE LOWEST LEVEL OF TRANSACTION PER SECOND Name Market Cap (USD) TPS* Lisk 3,050,296,041.00 2.50 Stellar 9,205,904,704.00 4.00 Bitcoin 168,077,000,266.00 7.00 Ethereum 12,921,792,685.00 10.00 Cardano 106,706,653,950.00 10.00 Litecoin 8,757,735,261.00 28.00 Bitcoin Cash 25,026,143,518.00 60.00 IOTA 6,177,228,101.00 112.00 NEO 9,135,230,000.00 1,000.00 TRON 3,369,259,549.00 1,000.00 Ripple 43,195,306,409.00 1,500.00 Monero 4,272,973,220.00 1,700.00 NEM 6,682,562,999.00 10,000.00 Dash 5.350.528.925,00 10,000.00 EOS 7,290,084,536.00 100,000.00 *Transaction per seconds Source: Coinmarketcap (Market Cap figures)
- 9. Strategic analysis of Bitcoin « Pros and Cons » 9
- 10. A Bitcoin/Blockchain SWOT analysis « Where are we now? » WWW.INITIO.EU 10 S W O T Threats • Increasing regulatory pressure: SEC case • Energy cost of mining Bitcoin: Bitcoin Energy Consumption Index topping at 47.65 TWh. (Comparable to Singapore electricity consumption) • Some countries banished the use of Bitcoins (Bolivia, Ecuador, …). Opportunities • Great macroeconomic spot. • More and more companies start accepting Bitcoins as payment method (PwC, Barclays, …). • A large list of potential use- cases (Blockchain use-cases). • Scalability – Lightning network could reduce fees and transaction speed. Weaknesses • Victim of it success: Scalability issues. • Average blocksize has grown: 0.94 MB to 1.06 MB with a 13% growth rate. • Increasing transactions fees. • Decreasing number of transaction per seconds. Strengths • Bitcoin transactions are performing a growing number of 24,293,141 Hash rate TH/s. • Average of 220,440 transactions per days for February 2018. • 508,681 unique addresses per days (Blockchain.info) and an 14 mil wallets (Coinbase report)
- 11. Bitcoin has been a game changer. What about the rest?... « A Bitcoin VS Ethereum case study » Tokens can be “payments” for: • Securing the network • Validating a specific transaction • Providing some kind of off-line work (smart-contracting) Ethereum Technology Stack Tokens can be representative of share of ownership in a company (ICO). WWW.INITIO.EU 11
- 12. Portfolio management opportunities « Focus on Arbitrage and Future contrats » 12
- 13. Arbitrage opportunities exist in the Bitcoin market « Huge gaps were identified between bitcoin exchange markets » WWW.INITIO.EU 13 7.900,00 8.000,00 8.100,00 8.200,00 8.300,00 8.400,00 OKEx Bitfinex Binance GDAX bitFlyer Bitstamp Upbit Kraken OKEx* Huobi Price BTC (USD) A fragmented market with many broker but no one has the same Market price for BTC The difficulty for brokers to determine a “fixed” is real. In fact, high differences in BTC prices are due to a lack of market depth of the order book. This automatically generates news market opportunities for traders. Arbitrage strategies have been widely used in traditional finance, striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices. High volumes means low deviation from the average price (TOP10) Here we can illustrate the fact that brokers with an improved market depth of the order book will have a smaller deviation than the others like Huobi or OKEx (BTC/EUR). 0,00% 0,50% 1,00% 1,50% 2,00% 0 500.000.000 1.000.000.000 1.500.000.000 2.000.000.000 OKEx Bitfinex Binance GDAX bitFlyer Bitstamp Upbit Kraken OKEx* Huobi Volume (24h) Epsilon(i) *OKEx for BTC/EUR pair
- 14. More emerging arbitrage opportunities with future contracts « Bitcoin future contracts at CME and CBOE in short » WWW.INITIO.EU 14 CBOE Future Contract equals 1 BTC CME Future contract equals 5 BTC Contract Expiration Seems to be a quarterly cycle DID YOU KNOW Cboe’s contract clears through the Options Clearing Corporation and an initial margin of 44 percent and a maintenance margin of 40 percent applies. -CME’s contract will clear through CME ClearPort and will have a 43 percent initial margin rate and a maintenance rate of 43 percent.
- 15. Credentials « Initio Knowledge Sharing (IKS) » 15
- 16. Consultants WWW.INITIO.EU 16 Senior Consultant Initio Luxembourg Sami EL Bouamri Sami work with a large portfolio of clients from various industries such as Banks and Insurance companies and Investment funds (Hedge funds, PE/RE funds). He supported his clients on different aspect of regulations such as Solvency II, PRIIPS, IFRS 9, UCITS V and on other Risk Transparency reportings. He also has been involved on project related to Business Process Automation, Blockchain, Crypto-currencies and Data science. Sami joined Initio in 2017. Consultant Initio Belgium Yvan Roncevic Yvan studied at UCLouvain and KULeuven and obtained a masters in management with a major in financial analysis. After two internships, of which one within the FinTech sector, and a first experience as an external auditor, Yvan joined Initio in 2017.
- 17. Contacts WWW.INITIO.EU 17 BRUSSELS Boulevard Brand Whitlock, 60 Brussels, 1200 Belgium +32 (0)2 669 77 44 brussels@initio.eu LUXEMBOURG 153-155 rue du Kiem - Entrée D 8030, Strassen Luxembourg +352 621 242 156 luxembourg@initio.eu GENEVA Rue du Commerce, 4 Geneva, 1204 Geneva +41 (0) 22 591 79 21 geneve@initio.eu