Trillion Dollar Security Token Economy Awaits Its Constantine Moment
Flavius Valerius Aurelius Constantinus Augustus, otherwise known as Constantine the Great, was a Roman general in charge of the Western territories of the Roman Empire. Another successful Roman general, Maxentius, was also vying for control over the Western territories. This culminated in a battle between the two in 312 at a place called the Milvian Bridge.
Shortly before the battle, Constantine had a dream or a vision of the Chi-Rho, an early symbol of Christianity with the words “By this sign you shall conquer” underneath it. According to the story, immediately after having this experience Constantine, ordered all of his soldiers to carry the symbol into battle against Maxentius. As fate or providence would have it, Constantine’s army, despite being outnumbered four to one, summarily sacked the army of Maxentius. With this victory in hand Constantine consolidated his power as Emperor.
Ascribing his victory to the Christian God, he converted (for all intents and purposes) to Christianity and removed the imperial pogrom on the fledgling religion. By the end of the 4th century, this obscure and persecuted religious sect had become the official state religion of the Roman Empire and then went on to radically transform the world.
Fast forward to 2018
Fact: Absent a massive earth-facing solar flare, there is no way to destroy Bitcoin and other blockchain enabled ecosystems. The proverbial genie is indeed out of the bottle. Sorry, Mr. Buffett. Despite SEC actions in the crypto space, massive amounts of institutional money and infrastructure are being allocated to it. Rothschild, Soros, Rockefeller, and Goldman Sachs are all throwing their chips in. Futures trading is in play and various ETFs are pending approval.
China’s ban on crypto made a dent but the crypto market quickly recovered and their decision to fight the anti-fragile mechanics of blockchain tech only served to deprive the Chinese government of billions of Yuans in tax revenue and GDP. Doh! Japan on the other hand, is issuing licenses to cryptocurrency exchanges and enjoying the spoils.
I think there are at least a few people at the SEC who can read the writing on the wall here. In fact, I know there are: Hester Pierce, affectionately known in the crypto community as "Crypto Mom". We’ve also just recently seen a major restructuring of regulatory perception with the SEC’s declaration that Ethereum (generally speaking) isn’t a security.
Yebbit, muh Anarchy…
My anarcho-crypto friends take issue with my stance here. But the same people disparaging cryptocurrency regulation are also always talking about the importance of, “widespread adoption”. I am now convinced that in order for widespread adoption to happen, it will be by way of compromise. Widespread adoption in exchange for safeguards and vetting that are designed to protect investors. Where's the problem?
How many ridiculous ICO schemes have we seen over the past few years? Some of them were just straight up exit scams. The percentage of ICOs launched over the past 2 two years that have gone on to deliver on their white papers is laughably low. Don’t get me wrong, I love the opportunity that the ICO model brings to early-stage entrepreneurs, and ICO services are a core focus for trade.io, but in terms of quality control — we really threw the baby out with the bathwater over the past few years in the ICO space.
The point is that a lot of people have lost money. The point is that a lot of people who made money did so by way of of pure speculation, not because the fundamentals and tech behind a particular blockchain project were worthy of being funded. How is that really promoting innovation? You might as well be throwing dice in Vegas. It doesn’t reward merit.
I'm guilty. I trade crypto and anyone who trades crypto can tell you that a lot of it is pure speculation. I wish it wasn't that way though. A little bit of regulation (a.k.a. quality control) would go a long way in weeding out the projects that really don’t deserve to be funded. Funding of higher caliber blockchain projects can only benefit the proliferation and sustainability of blockchain tech.
Which project would you rather participate in? The 2017 ICO, or a properly vetted ICO? Which project do you think will succeed in the long term?
The point I’m making to my Crypto Faction friends and to the crypto community at large is that meeting regulators halfway is in everyone’s best interest, not only for the quality control but because we know and trust that the blockchain actually is a “a database of virtue”. Once it’s embraced by the status quo, the very nature of it's immutability and transparency will have a neutralizing effect on the cronyism, graft and bureaucracy currently infesting our governments and institutions.
At a certain point, "hidden hands", won't be able to hide anymore.
The smart status quo policymakers promoting blockchain will be seen as champions of the transparency it creates and those fighting against it will be seen as having something to hide. Maybe that idea seems naive? I call it optimism. Never before have we had a mechanism to achieve such an epic transformation of society. We absolutely should not take that for granted.
Soon...
Based on our historical analogy and the current trajectory, we may see a Crypto-Constantine of sorts emerge from the ranks of the U.S. policymaking Status Quo Faction, leading to a sanctioning of regulated cryptocurrency. Trillions of dollars of US retail investor dollars would be unlocked, ushering in a new wave of innovation and wealth creation. The capital currently flowing into crypto at the moment is reminiscent of the dot com era, or dot com “bubble” if you will.
The thing is that in the current situation the capital isn’t funding hardware but mindshare, and a growing community of smart, passionate, and dedicated developers and entrepreneurs. Collaborating on open-source software with an ever ever-increasing velocity, these innovators are pushing the needle on Moore’s law and new blockchain-inspired paradigms and economies are being knitted together at an exponential rate.
By working with regulators and employing common sense safeguards to protect crypto enthusiasts we can participate as a catalyst to bring together these two warring factions and achieve the widespread adoption of blockchain that will benefit industries and societies around the world.