Blockchain Tech, CoinDash and the Future

Blockchain Tech, CoinDash and the Future

Jake Brukhman Co-Founder at CoinFund wrote the following article about “CoinDash and the ‘killer app’ of the blockchain space”. Blockchain tech will change the world. The questions are when and how. This article reveals part of that answer.

“If token creation (and therefore investments) are the most common use-case for blockchain technology, then enabling more people to invest in cryptoassets is of the highest importance.”

— CoinDash Whitepaper v0.2

The search

One way to view the blockchain space is as a massive multiplayer search for the ever-elusive “killer app”. This app will (supposedly) go viral, go global, bring blockchain to the masses, and validate everything.

In the early days, observers of blockchains formed a thesis. They posited that Bitcoin — the world’s first decentralized blockchain network — would revolutionize payments and remittance as a global, borderless currency. Yet as practice has demonstrated, nascent and volatile digital currencies are dangerous for remittances, especially in the mainstream business context. Instead, today most people hold Bitcoin as a speculative investment.

In the public blockchain sector, projects like Ethereum (and many, many others) are pioneering decentralized crowdfunding. These companies are using blockchain-based digital assets to turn the startup fundraising orthodoxy on its head, to amass impressive capital pools, and to set out onto new directions for corporate ownership. At the same time, the financials of the cryptoasset asset class are quite new and traditional measures do relatively little to aid true evaluation. Today, many projects in the space sit with enormous valuations while having neither users nor products. In some cases they are, controversially, little more than a team with a whitepaper.

The world is waiting for “blockchain” to take off, but which vertical will produce the first significantly adopted mainstream product? Will the killer app be Steemit’s decentralized social media platform, or some yet unknown company in Fred Ehrsam’s blockchain-enabled VR thesis?

The killer app of blockchain

“Tokens” are now officially a hot topic among early stage technology VCs, who are slowly beginning to recognize these assets as key investment vehicles for exposure to decentralized networks; some of them have formed theses specifically around decentralization and token investments. In our recent survey of cryptoinvestors, 1 out of 3 respondents reports holding over 75% of their entire investment capital in digital assets.

In other words, there is a strong signal that at the moment, the “killer app” of blockchain is investment in the cryptoassets of the blockchain space.

Simultaneously, our same survey describes incredible skews in the community of people interested in these investments. They are predominantly male (91.5%), predominantly 25 to 40 years of age (66.4%), predominantly technical (59.2%), and around a quarter of them (26%) are probably accredited — a privileged status reserved for just 3% of Americans.

If blockchain investing is driving interest in our space today, then facilitation of mainstream adoption must come through improved access, tools, and eduction of mainstream investors.

An operating system for blockchain investing

Alon Muroch has set out to solve the multidimensional problem of bringing blockchain investing to the mainstream. In bringing up his project, CoinDash, he is thinking of it as an “operating system for cryptoassets”.

CoinDash sees the proliferation of token sales as a game changer which has created a non-trivial market of investors seeking ever more diversification. These investors are consequently holding portfolios with multiple tokens, sometimes up to 10 or more. “Yet,” says co-founder Adam Efrima, “[investors] lack the tools to allow them better navigation and control over a multi-asset portfolio that is managed over various platforms, wallets, and exchanges.” It may be therefore natural that CoinDash has partnered with Smith+Crown, a data and original research house in the space covering token sales, suggesting future integration between the two products.

If cryptomarkets are financial technology analogous to traditional markets, then how can investors in such markets make decisions without research, data, and transparency? “CoinDash is aiming to create tools that will allow better investment decision and analysis tools for cryptoinvestors,” says Adam Efrima. In the initial beta version, CoinDash promises portfolio metrics such as market and risk benchmarking; traders can now have tooling around a precise and basic measure of success and know whether they are actually outperforming the market.

The idea of being able to peak into the portfolio of influential investors and follow on their investment ideas is known as “copy-trading”, another selling point of CoinDash. This functionality lowers the barriers to entry for new cryptoinvestors by relieving them of the “need to spend hours on learning and following ICOs” while giving the experienced investors an opportunity to monetize. Says Adam, “Influencers can earn from their expertise and newbies can have a fast track, a user-friendly solution to interact with them and copy their trades.”

Finally, the “Software-as-a-Service” layer envisioned by CoinDash will allow programmatic access to both execution and automation, and in the future may integrate with decentralized portfolios through Melonport or ICONOMI. The ability to schedule and create conditional rules for execution are the first steps toward unprecedented levels of automation for discretionary strategies. Imagine, for example, automatically rebalancing your portfolio to copy-trade your favourite portfolio manager of the month. Similarly, CoinDash describes “copy-ICO” functionality, where users can replicate another user’s buy-in behavior during a token sale.

Overall, if you have a poor idea of how your investment portfolio performed against Bitcoin, Ether, an index of top cryptoassets, and the S&P 500; or whether your diversified token collection actually improved on Bitcoin’s volatility; or if you’re buying random assets without consulting your friends — then consider following and supporting projects like CoinDash.

In summary

For the moment, with relatively open-minded regulators, with growing institutional backing for non-Bitcoin blockchains, and the idea of a new asset class, it feels like tokens have arrived. Infrastructural startups which produce the tools for handling these amazing technologists do not face the same adoption challenges as those operating in general verticals: they face an existing niche market of millions of people which is attracting more and more mainstream customers.

The offering described by CoinDash should be an obvious asset to cryptoinvestors of varying levels of sophistication. Its social and automation features should increase efficiency of information and execution, while underlying asset management platforms provide decentralized infrastructure underneath. Research, data, and benchmarking should improve the ability of users to make safer investment decisions. Ultimately, could investment platforms pioneer the early majority adoption of the blockchain space?

CoinFund is a blockchain technology research company, advisory team, and private cryptoasset-focused investment vehicle. We work with companies in the blockchain space and beyond to understand how blockchain-based economics can be used for financial applications such as crowdfunding, and more. If you’re a blockchain project or are interested in exploring blockchain technologies for your product, please get in touch with us or join us in the CoinFund Slack.

Original Article published

Daniel Woo

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