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Only Permissioned Blockchains Can Transform Finance, Says Chain’s Ludwin

Source: bitcoin

Governance chain

Who really understands what a blockchain is? Could you explain it to your mother? Chain CEO Adam Ludwin got down to fundamentals yesterday, as he explained his company’s intention to transform financial services by digitizing already-existing assets.

Also read: Visa Introduces Blockchain-based Solution for Payment Services

Ludwin spoke on a Tuesday afternoon panel with at the Money 20/20 Conference in Las Vegas.

Blockchains Transform Finance From the Bottom Up

Adam Ludwin

Assets including U.S. dollars and Starbucks points could move on blockchains with greater efficiency and security, he said.

“A blockchain is actually a new type of database,” he said, adding that it’s a “boring” topic that only fills conference halls because it involves money and wealth. These aspects still have the power to transform financial services and thus society though, he added.

“A blockchain is like a digital network of safety deposit boxes, in the sky.”

You don’t have physical possession of a safety deposit box but you do have a key, he said. Anyone can have control of those keys, individuals and institutions.

Other (non-blockchain) FinTech models are trying to transform financial services from the top down, connecting back into existing infrastructure like banks. Blockchain, on the other hand, starts at the bottom of the stack, with the creation of the asset itself. Then it works up from there.

Bitcoin seeks to build a financial system completely outside any existing network, Ludwin said. When Bitcoin proponents talk about moving away from the dollar completely it sounded like “I’m going to get shotguns and bitcoins and go live in the mountains,” he quipped, adding that he still thinks Bitcoin is “great”.

Ludwin: Chain to Focus on Results, Not Hype Cycle

Most of what you’ll hear about Chain from now on will be from partner firms like VISA, he said. The company is moving out of the “hype cycle” and wants to focus on real-world results.

A day earlier, Chain also announced it is open-sourcing its platform, and published its technology roadmap for the next five years.

Moderator Robert Hackett of Fortune asked if there is any “snake oil” in the industry. Ludwin replied it’s good to see a Darwinian-style winnowing-down of those projects focusing on hype more than real outcomes — which is common in all tech sectors.

How Chain Moved from Bitcoin to Asset Chain Development

Chain launched in April 2014 as a company building Bitcoin APIs. The intent was to build tools to make life easier for Bitcoin developers. After demonstrating the technology to clients, however, they asked fundamental questions about how blockchains actually move value. And in doing so, they opened the Chain team’s eyes about how financial networks functioned.

“There’s a real problem in the market around asset movement,and security and custody, and it’s a much bigger and harder problem,” Ludwin said. Neither Bitcoin, Ethereum nor even Ripple was designed to solve this. Chain then put its heads down for two years to develop the technology it’s releasing right now.

What the Financial Services Industry Really Needs

Chain has sat down with executive-level employees at financial services firms to get a better understanding of their needs.

Their companies have proprietary assets (such as loyalty points) and they want to control the networks those assets move on, Ludwin said. They don’t see open, public blockchains as a viable option.

It’s important for networks like Bitcoin and Ethereum to remain decentralized, he said, because that’s the whole reason they exist. Permissioned blockchains are more about finding the least amount of centralization its participating entities need. Each node can control a different function in the consensus process.

Chain sees itself as halfway between existing financial infrastructure and the Bitcoin network, he said. The aim is to integrate with what exists rather than trying to replace everything.

Is Ludwin right about the nature of blockchains and how they can transform our world? Let’s hear your thoughts.

Images via: Money 20/20, Chain 

The post Only Permissioned Blockchains Can Transform Finance, Says Chain’s Ludwin appeared first on Bitcoinist.net.

Only Permissioned Blockchains Can Transform Finance, Says Chain’s Ludwin

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Can a Company Called ‘Lawnmower’ Reinvent Blockchain Investment?

Source: bitcoin


In a recent video, young startup Lawnmower explained their recent pivot from “spare change” investing of bitcoin to becoming a more comprehensive research and trading hub for multiple blockchain assets. The founders also introduce the Lawnmower Blockchain Index (LBI). 

Also read: Bet on MMA with Bitcoin: UFC 202, McGregor vs Diaz 

Lawnmower: From Spare Change to Big Time Blockchain Investment

One year ago, Lawnmower introduced its new mobile application to the public, along with its unique “spare change” functionality, allowing users to easily build up savings in the form of bitcoin. The functionality, along with its slick, modern design was heralded by many as the easiest and slickest way to create a portfolio of bitcoin.

The company, which is comprised of three recent University of Florida graduates, was rewarded with a placement in Boost VC’s San Francisco start-up program.

“We spent time in San Francisco developing the first version of our application and building strong relationships with partners such as Coinbase,” Alex Sunnarborg, CFO of the company said. “However, we soon realized that although our ‘spare change’ model helped us to gain a foothold with users, we needed a longer term strategy to take advantage of the growing cryptocurrency markets and to provide a more robust investment platform for our users, who told us that they wanted additional capabilities for saving and investing as well as additional research and information.”

This “pivot” in strategy was met with criticism from many of their users.  The uniqueness and ease of the “spare change” model was, for many of them, the reason that they used the Lawnmower application.

“We recognized that we would get some negative reactions from users for dropping the ‘spare change’ model,” Sunnarborg said. “It’s important to listen to what they had to say and we knew that we had  a longer term strategy that required a different focus for the business that we would have to communicate to our users.”

This new strategy led the company to accept entry into a program in New York City with Startupbootcamp FinTech New York.

“With our new strategy, it was clear that we were more of a fintech company and not just a bitcoin company, and New York is the center of the financial world,” said Pieter Gorsira, CEO.

Now that the Startupbootcamp FinTech New York program has ended, the company has left San Francisco for good and is in the process of setting up permanent headquarters in New York City.

The company is working with its investors and advisers to solidify their longer-term strategy, which includes building a robust analyst-level research capability to evaluate all of the major blockchain assets — not just bitcoin.

Lawnmower will soon include the ability to easily buy multiple blockchain assets based on personal allocation, with the option of a recurring purchase program.  They have also expanded the number of blockchain assets that they provide real time pricing for, as well as enhanced the performance reporting for clients’ portfolios.

Pieter Gorsira, CEO of Lawnmower speaking at an investor meeting

“We want users to use Lawnmower as their home to easily see what’s going on in the blockchain asset market throughout the day,” said Gorsira.

To this end, the company has introduced their Lawnmower Blockchain Index, which is a real time tracking index of the top blockchain assets.  “Since we began, blockchain assets have grown in number and influence.  We wanted to create an easy to use and understand way for anyone to track the pricing performance in these markets,” said Gorsira.

“We knew that our strategy was best for our users, but we realized that we needed to be very clear with them about why we changed and what our vision for the future was,” said Patrick Archambeau, CTO of the company.  To that end, the company created a message to their community that is part of their regular communications to their users.

“Our users are the key to our success,” Archambeau said. “We plan on actively engaging with them on a regular basis and invite them to contact us directly or visit us at our new New York location.”

The team also hinted that their spare change model may come back at some time in the future, but for now they’re focused on developing the application to take advantage of the current and longer term trends in the blockchain asset markets, and to provide it in an easy to use and elegant manner for their users.

“Ease of use is in our DNA,” said Sunnarborg.  “It’s what brought our users to us and it’s the platform that we’ll always build upon.”

What do you think?  Does the future look bright for a company like Lawnmower and the blockchain asset market they’re targeting?

Images courtesy of Wikimedia Commons, Lawnmower.

DISCLAIMER: Jack, the author of this article, is an angel investor and currently an advisor to Lawnmower.

The post Can a Company Called ‘Lawnmower’ Reinvent Blockchain Investment? appeared first on Bitcoinist.net.

Can a Company Called ‘Lawnmower’ Reinvent Blockchain Investment?