Author: Melissa Yap , Asia Token Fund Writer
On 8th September 2018, the first-ever Bibox Global Meetup was held at Singapore Management University. This event was heavily subscribed with over 300 guests attending the 200-seat seminar. Key speakers included Liu Guojie (Managing Director, Bibox Southeast Asia), Prof. Zhu Feida (Associate Professor, SMU), Jerry Li (CEO, DUO Network) and Michael Juskiewicz (CFO, eMusic).
Nizam Ismail (Head of Financial Services, RHTLaw Taylor Wessing) highlighted 2 possible regulatory areas of focus, quoting Sopnendu Mohanty, Chief Fintech Officer of MAS. Firstly, he envisions “regulators coming to a broad agreement on utility tokens and on what distinguishes them from payment and security vehicles.” Secondly, “regulators should agree on application of existing consumer protection laws to ensure that ICO issuers are still held accountable for the promises they make during pre-sales of tokens.”
Blockchain enthusiasts at the Meetup were enthusiastic to hear from the token funds panel discussion moderated by Aly Madhavji (Managing Partner, Blockchain Founders Fund) and joined by Ian Lee (Principal, Signum Capital), Li Xi (Partner, H.Capital), Lim Hong Zhuang (CEO, XSQ Capital), Michael Ng (Co-founder, MW Partners) and KC Chng (Regional Partner, Kenetic Capital). Below we summarise the 5 key insights shared by these industry veterans:
1. “We may see a massive ETH dump in the future” – Li Xi, Partner, H.Capital
Certainly not a sanguine remark we were hoping for in this bearish market. Li Xi cautioned, “Bitcoin price is still very strong compared to ETH which has dropped 80% from its all-time high. Firstly, every day, there are 20,000 ETH created, as opposed to limited supply like BTC. Secondly, the ICO fever has subsided. Thirdly, more than 50% of ETH raised in ICOs have not been sold into fiat yet. In the future, we may see a massive dump.”
2. Investment Guidelines for ICO Investing: Investors, Governance and Ethics
Lim Hong Zhuang revealed that for real-world investing, it is essential to examine whether investors in the company’s early fundraising stage provide company with connections to the ecosystem. As Ian Lee mentioned, it is key for a blockchain company to engage with its investors in terms of sharing their insights.
Prior to making an investment, Aly Madhavji raised an important consideration factor on the governance and ethics of the company. If a blockchain company has less than two-year lock-up period, this is a cause for concern.
3. Token Funds’ Advice to Blockchain Companies: Transparency, Refraining from Greed, Time Lapse between Seed Rounds
KC Chng conducted his own ICO in 2016 when his team spent the most time on engaging with their community via Reddit or messaging apps. He added, “Transparency and sincerity are key to garnering support to have a successful ICO”.
Ian Lee cautioned against succumbing to greed and setting a reasonable fundraising target such as 15 million instead of 30 million.
Michael Ng brought up the possibility of time-lapse between various rounds of fundraising as “not all investors have the same risk appetite. Some as OK with higher valuation for proven businesses”.
4. Downfall of ICOs? Token Funds Anticipate More Reverse ICOs and STOs in 2018
“I think we can all agree that blockchain technology is here to stay but we are not sure about ICOs.” On the back of his cynicism about ICOs, Ian Lee shared that Signum Capital holds a few Reverse ICOs in their portfolio. KC Chng added that “the market is waking up to the realisation that mass adoption is the key to projects. There may be a shift in terms of narrative, such as reverse ICOs to migrate more traditional users to blockchain usage”. Similarly, Lim Hong Zhuang foresee more reverse ICOs coming in to drive mass adoption.
KC Chng also sees real-world use-cases for Security Token Offerings (STOs) and this optimism was shared by Lim Hong Zhuang, “Better than ICOs, STOs carry great appeal.” Indeed, STOs are worth looking into as they allow any company, not just blockchain companies, to tokenise its equity. On top of that, STOs provide global regulatory compliance.
5. What else will work in 2018? NFTs and dApps
KC Chng believes that Non-Fungible Tokens (NFTs) like CryptoKitties will be a big thing in 2018 as they are new, innovative and fun. He foresees the utility of it in the gaming space within blockchain.
With an analogy that property investment is successful when the property is built on a land with decent infrastructure. Ian Lee argues that with the abundance of infrastructure projects at the moment, the next opportunity lies in dApps.
Bibox is the first A.I.-enhanced encrypted digital asset exchange launched in November 2017. Now the quality digital asset exchange platform operates in Europe, America, and Asia with a steady top-10 ranking and an average daily trading volume of US$200million. Bibox is a team of over 100 employees with offices in New York, Vancouver, Tokyo, Seoul, Beijing and Hong Kong, with the Singapore office newly set up in July 2018.