Eeyore and Tigger debate the great Institutional wall of money into Blockchain meme


“May you live in interesting times” applies to today’s era which is turbulent on every plane –  financial, technical, social, political. If Blockchain is real and can deliver value it has plenty of problems to solve. That much I am sure about. 

Deep in a bear market, capitulation means most people are giving up on Blockchain, Bitcoin & Cryptocurrencies. The Tigger optimists often talk about the great Institutional wall of money moving into Blockchain as evidence that the next bull market is coming.

As an entrepreneur I tend to be a Tigger type of optimist. However there are many things I am not sure about and as an entrepreneur I also know that hope is not a strategy and it is valuable to listen the Eeyore type pessimists; dealing with their objections defines your action list. In this post, I outline:

  • What I am sure about aka strong opinions.
  • What I think is likely aka weak opinions.
  • What I am not sure about aka what I want to learn.

Note: When I say Blockchain I mean Blockchain AND Bitcoin AND other stateless, permissionless Cryptocurrencies. It is very easy for even the most conservative Eeyore types to laud the value of Blockchain without the addition of a stateless, permissionless currency like Bitcoin that is so disruptive. That would be an easy way to embrace and bury disruptive change. Pretty quickly we would move to permissioned Distributed Ledger Technology (DLT) from an enterprise software company that is totally controlled by Institutions. That would be as disruptive as the latest version release of an ERP system.

What I am sure about

  • The Blockchain wave of change is unstoppable. Call this an opinion not an irrefutable fact, but it is a strongly held opinion based on two observations in the real world:
      • Blockchain does work technically. After 10 years, there is very little doubt about this.
      • The current Legacy Finance system is broken. Just ask anybody who went through the Global Financial Crisis 10 years ago if you doubt this.
  • I am also sure that the strongly held opinions about this wave of change from both the Tigger and Eeyore types are almost entirely based on how that person’s financial interests are impacted. If you have done well in Legacy Finance, you take the Eeyore side of the debate; Bitcoin will not be good for business. If you bought early into Blockchain, Bitcoin & Cryptocurrencies, you take the Tigger side of the debate; your investments will do very, very well. This leaves the vast majority of the world, who have not done well in either case, unsure about who is right.
  • I am also sure that the market will decide whether Eeyore or Tigger is right. For Pooh Bear fans, this humble “bear of little brain” is the market. 

What I think is likely.

  • Institutions will invest in Blockchain, Bitcoin & Cryptocurrencies.  I think the great Institutional wall of money into Blockchain meme is for real. Those Institutions are reading the same market signals and see opportunity and know that “disrupt before you are disrupted” favors the early movers. These Institutions compete with each other. They don’t want to be the Blockbuster/Kodak of this era.  All those conservative Legacy Finance Institutions will make some careful, hedged bets that will in aggregate ensure that the next bull market happens.


  • There will be another bull market. I have no clue when it will start, or how big it will be; actually I know for a fact that BTCUSD will hit $1.3 million on 15 January 2025 at 11am CET!  I simply think another bull market will happen because that is what always happens with disruptive waves of change. There is no certainty on this, but investing is a statistical probability game and the statistical odds favour another bull market.


  • The retail speculators who got burned in the last boom and bust won’t do anything in the next bull market. This is not because they don’t want to, simply because they have no money left to invest. Sadly most who invested during the great 2017 meltup got wiped out during the 2018 bear market.


  • There are few techie early adopters who will invest in the next bull market. That game was what got Bitcoin into the market in 2010 to 2012 and Ethereum into the market in 2014 to 2015. Those were dirt cheap bets on crazy high risk deals. Why not take a risk if the cost is not much more than the cost of a couple of pizzas? Prices today, even in this bear market are still too high for that game. These techie early adopters will Hodl no matter how low we go, because their cost base is so low, but that does not mean they will lead the next bull run.
  • So the market needs a new breed of investor. That is why the great Institutional wall of money moving into Blockchain meme is so appealing to the Tiggers of the world.
  • Institutional Investors will come into the market. When they come in and in what volume is unknown, but I believe that the raft of PR announcements by the biggest Legacy Finance Institutions means that they will enter the market. Reputation is as valuable as cash and they have already put their reputation on the line.

What I am not sure about

The mantra of any good investor or any good journalist and of the Experts who write on the Daily Fintech platform is to aim to be a “learn it all, not a know it all”. The more you know, the more it becomes apparent what you don’t know; the search for what is true is never-ending. The best role of an Advisor is often simply asking good questions. Here are my questions about the great Institutional wall of money moving into Blockchain:

  • When will it happen? I cannot put a date on it, but I am confident that price is not the major issue. Institutional Investors know the Wall Street mantra that “bulls and bears have their day, but pigs always get slaughtered”. This translates into knowing that it is silly to try and enter or exit at precisely the bottom or the top; near the bottom or near the top is good enough. What I am am not sure about is when the market will deliver the two features that institutions demand:
      • Custody. Asset security is a major issue with bearer bonds. This is particularly  true if hundreds of traders have access to the keys of the safe. The Private Key security of Blockchain is OK for nerdy individual investors, but less so for big Institutions or for mainstream retail investors. That is why Institutional grade Custody is such a big opportunity.
      • Liquidity/price discovery. Liquidity/price discovery is a tough problem to solve in a decentralised network; and Institutions understand that this market will evolve quickly into a decentralised network.

From PR announcements you might think both are close, but the devil/god is in the details. We know this from our Advisory Services,where we are known for combining big picture  vision with  pragmatic executionInstitutions won’t commit in volume until the details are resolved.

  • Will the Institutional  phase be short lived like the Intranet phase of the Centralised Internet? Disruptive change often goes through a Corporate phase. Before companies like Amazon, Google and Facebook brought the Internet to the mainstream consumer, we had the Intranet era (closed, permissioned versions of the Internet). That was short-lived. Will the the great Institutional wall of money moving into Blockchain follow the same trajectory?
  • What sort Institutions will invest in Blockchain and why? There are three types of Institutions moving into Blockchain and they have fundamentally different strategies and objectives
      • Type 1:  Buy Side Direct. Those retail investors (derided as “muppets” by the Institutional smart money) are Buy Side Direct. The problem is they invest tiny sums. Family Offices, controlling about $2.6 trillion of global assets, are like retail investors on steroids; they invest their own money. Whether you call them Institutional or not is language issue only; they invest like Institutions and with Institutions.
      • Type 2: Buy Side Intermediaries. These include hedge funds, sovereign wealth funds, pension funds etc. They tend to be more conservative than Buy Side Direct because they have “explanation risk”. If they take a contrarian bet and it goes wrong they have a lot of explaining to do
      • Type 3: Sell Side. These include brokers, exchanges, Investment Banks ie classic “Wall Street”. They want business from Types 1 and 2. If the Sell Side see evidence that Types 1 and 2 want to get into Blockchain, they will invest to service that demand.

What I think is that the great Institutional wall of money moving into Blockchain will start with Family Offices. If they allocate 1% of that $2.6 trillion they control it will a) bring $26 billion into the market and b) that will bring the much bigger capital pools from Type 2 into the market

If you work in a big Institution and need some help figuring this out from a learning coach (somebody who knows Blockchain from all angles and is good at explaining it), check out our Book An Expert For An Hour service.

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Bernard Lunn is a Fintech deal-maker, investor, entrepreneur and advisor. He is the author of The Blockchain Economy and CEO of Daily Fintech.

Check out our advisory services (how we pay for this free original research). To schedule an hour of Bernard’s time please click here to send an email

Thrive for Fintech, “shout out” for innovative firms solving real problems

This week saw the launch of “Thrive for Fintech”, an investment programme focused on Financial Inclusion. Green Shores Capital (my fund) have partnered with Crowdcube for this and it is sponsored by Deloitte. The applicants will be funnelled through a competitive evaluation criteria and six of them will be shortlisted. Via this initiative, we will identify and invest in up to three top Fintech firms.

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This is the programme page, that talks about the criteria in detail

“Successful applicants will also receive a legal support package to cover areas such as company structure, employment and incentives, data and IP, as well as receiving exclusive access to an online platform with a host of free legal resources. All finalists will also be invited along to a legal workshop that is specifically tailored to Fintech businesses.

Lastly, the successful applicants will also receive an accounting support package from Deloitte finance experts, covering areas such as raising investment and financial strategy. Along with a free, bespoke online accounting package and customised analytics dashboard.”

So how did this happen?

All three partners at Green Shores, Deepak Ahuja, Banesh Prabhu and yours truly, have all had decades of Financial services experience. We have had years of global exposure and have seen real world challenges especially in Emerging markets due to lack of Financial Services at the last mile. When we set up Green Shores earlier this year, we identified Financial Inclusion as a core theme for our investment thesis.  

We have made several investments through our previous fund in this space and want to further this cause via Green Shores. This was and is critical as many use cases we see in the UK and in the west are focused on impactful themes, however in order to create impact at scale they need to expand into emerging markets. 2.7 Billion people in the world live outside the conventional financial services system.

This programme also demonstrates that its critical to bring together multiple ecosystem players to create meaningful impact. And we believe, this is a model that can be replicated across different innovation clusters where there is a dire need for capital.

Access to capital is not a goal in itself – it is a means to end poverty and economically empower people – the first step towards achieving healthcare and education, a means to help grow enterprises and create jobs, a means to tackle unemployment, and so much more. 

Arunkumar Krishnakumar is a Venture Capital investor at Green Shores Capital focusing on Inclusion and a podcast host.

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Insurtech Front Page Weekly CXO Briefing – InsurTech Upstarts at the Gate

Isometric Healthcare and technology concept banner. Medical exams and online consultation concept. Medicine. Vector illustration.

The Theme last week was China opening up its insurance market.

The Theme this week is InsurTech Upstarts at the Gate. The end of 2018 is coming. In the past we have often covered the moves from the big Insurance and Reinsurance Incumbents, who have been surprisingly agile and innovative given their size and legacy. This week we cover the moves by the VC funded startups.  

For more about the Front Page Weekly CXO Briefing, please click here.

For this week we bring you three stories illustrating the theme of InsurTech Upstarts at the Gate.

There was a lot of important Insurtech news to process this month. There were  many fund raising deals that did not make our constraint of 3 stories per week. These include Clyde raising $3m, MioAssicuratore $1.7m, Corvus $10m and ELEMENT $26m.

The three stories that were most significant were:

Story 1: Insurtechs launch new UK body

Extract, read more on Insurance Times:

“A group of 31 companies have banded together to launch InsurTech UK.

The core aim of the group is to support the UK insurtech sector and promote the benefits of insurtech.

The group held its inaugural meeting on Wednesday, with 20 members in attendance for the launch.

Members include Anorak; Azur; Bikmo; Bought By Many; Buzzmove; Canopy; Claim Technology; Concirrus; CoVi Analytics; Drover; Equipseme; Floodflash; Hokodo; Honcho; Kasko; Konsileo; Laka; Marmalade; Meet Sherpa; Urban Jungle; Pluto; Polaris; PolicyCastle; Shepherd; So-sure; Tapoly; Track My Risks; Worry and Peace; Wrisk Yulife.”

UK has always been a major market for insurance with numerous renowned insurers. But when it comes to InsurTech, it seems a little behind, not only in global but also in Europe. With startups forming up a union, maybe we can expect a super InsurTech force in UK in next a few years.

Story 2: Insurtech Oyster Opens up Its Pay-as-You-Go Workers’ Comp Model in California

Extract, read more on Insurance Journal:

“A new insurtech wants to provide pay-as-you-go workers’ compensation to as many small businesses in California as possible, and it hopes to use the momentum it’s built following a quiet launch in the East earlier this year to do just that.

Oyster Insurance, which started providing workers’ comp to 70-plus classes of business in New York and New Jersey without much fanfare or media coverage in January, began operating in California this week.”

Oyster’s expansion in California has already attracted a dozen companies to sign deals with them in a few days’ time. They have licenses in 26 states and plans to get more in 2019. So they are obviously only in the beginning.

Story 3: Insurance startup Bright Health raises $200M at ~$950M valuation

Extract, read more on Techcrunch:

“A flurry of digital-first insurers are betting they can surpass industry incumbents with a little help from technology and a lot of help from venture capitalists.

The latest to land a massive check is Bright Health, a Minneapolis-headquartered provider of affordable individual, family and Medicare Advantage healthcare plans in Alabama, Arizona, Colorado, New York City, Ohio and Tennessee. The company, founded by the former chief executive officer of UnitedHealthcare Bob Sheehy; Kyle Rolfing, the former CEO of UnitedHealth-acquired Definity Health; and Tom Valdivia, another former Definity Health executive, has brought in a $200 million Series C.”

US InsurTech startups are growing both in numbers and scales. There have already been 94 deals in 2018 globally and 2 billion USD raised in US.

The big raise this week is from USA, from the massive broken Health Insurance market.

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Zarc Gin is an analyst for Warp Speed Fintech, a Fintech, especially InsurTech-focused Venture Capital based in China.

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Gifs, memes and Money Mentors – the era of the expert is here

This week over at Daily Fintech we launched our book an expert service, allowing our readers to go one layer below the research we provide for free, in the public domain. It’s one more string to what I can confirm are many stringed bows for each of us in the team.

I like to think this initiative is a perfect microcosm representation of the emerging workplace – niche subject matter experts that can now monetise their skills via low barrier, digital service marketplaces. It’s that next evolution beyond more traditional freelance platforms like UpWork and its ilk.

Leveraging knowledge imbalances has always been at the heart of the service economy. While some types of knowledge are now readily available at our fingertips, complex decision-making processes still require a helping hand. Like navigating the US student loan system.

NextGenVest, which just this week announced it had been acquired by CommonBond, connects wannabe students with Money Mentors: current undergrad college students, sophomore and higher (but not graduate students) who have previously applied for financial aid and scholarships. Via text message, Money Mentors are ready, between classes and beer pong, to answer questions and provide guidance on how incoming students can negotiate and access the best student loan deals possible. As detailed in the job description, Money Mentors must:

Create a friendly environment for conversations with students over text using gifs and memes. Be available for shifts at least 16hrs/week (over 3-4 days) between 8am-12am (but you get to choose your shifts according to your schedule!)

Money Mentors are paid based on the amount of times they ‘deliver value to a student’, with the average mentor making upwards of US$400 every fortnight. Not bad going for a student with a few hours to kill. And we all know they have plenty of those.

3 or 4 years ago, who would have thought this would have been a job? It’s a reminder of the scope and untapped economic opportunity in the knowledge economy. While NextGenVest might be exploiting a surprisingly niche area, there are plenty of other sites you can head to for more typical advice, served up online, in micro-bites. For example, if you’re a doctor or a vet, try Just Answer, or if you want startup advice, head to Clarity. If you’re a bit of generalist, head to Maven, who’s tagline is ‘Everybody Knows Something’. Well at least they think they do, in my experience.

Portfolio careers are blossoming, and NextGenVest and co are just one of the ecosystem enablers. Financial services that support this new ‘work’ paradigm aren’t really keeping up. As the line between work and personal life gets even more blurred, this idea of business and personal banking being ‘separate’, starts to break down. It’s one of my core theses, and something I’m yet to see anyone really tackle, in a serious way. ‘Next Gen Banking’ shouldn’t be about digitising existing banking processes, or making them faster. B-o-r-i-n-g. It should be about inventing completely new ways of thinking about money and lifestyle, or reassembling the constituent parts into novel and fresh experiences. I guess we’ll just have to keep waiting a little longer…

Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech. Jessica Ellerm is a thought leader specializing in Small Business and the Gig Economy and is the CEO and Co-Founder of Zuper, a new superannuation startup in Australia.

One97 – From selling Astrology services over the phone to a Global Fintech Unicorn

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A glance at the infographic with the top global Fintech unicorns[1] (as of Q3), fired several thoughts. Gold and bronze position to Chinese born giants, Ant Financial and Lu. The top seven Fintech unicorns that could fit their balloons which reflect their relative size in USD, included no European born companies. The US gave birth to four out of the seven Fintechs, which still operate mostly locally – Stripe, Coinbase, Robinhood, and Sofi.

One97 with a $10bil valuation, sitting right in the middle, was the only one that I honestly didn’t recognize with a blink. Once I started looking into the entity, I realized that a visit to New Delhi is long due. India is where One97 Communications operates. It is the leading mobile internet company offering mobile content and commerce services to millions of mobile consumers. Vijay Shekhar Sharma is the founder of this Unicorn which was launched in 2000!

One97 is endorsed by international big brand name investors:

  • Alibaba Group and Ant Financial (AliPay), own 40% of One97 shares.
  • Japan’s SoftBank became a shareholder in May 2017, injecting $1.4 billion in One97 for a 14.2% stake.
  • Berkshire Hathaway invested $356 mln in One97 (3%-4%) on the 28th October 2018, which brought the valuation up to $10bln[2].

One97 Communications is the mama of the flagship Paytm, born in 2010. This is the brand name that we all recognize.

PAYTM, at a glance

Paytm is a leading payment solutions provider to e-commerce merchants using a semi-closed wallet, approved from the Reserve bank of India.

Paytm started off in 2010 as a prepaid mobile and recharge platform and added a data card, postpaid mobile and landline bill payments.

In 2014, it launched the Paytm Wallet, and the Indian Railways and Uber added it as a payment option. It continued into E-commerce with online deals and bus ticketing.

In 2015, Paytm broadened its services with use-cases like education fees, metro recharges, electricity, gas, and water bill payments. It also started powering the payment gateway for Indian Railways.

In 2016, Paytm launched movies, events and amusement parks ticketing as well as flight ticket bookings and Paytm QR. It later launched rail bookings and gift cards. Paytm in India is considered the pioneer of QR based mobile payments.

In 2017, Paytm became India’s first payment app to cross over 100 million app downloads. It launched Paytm Gold, a product that allowed users to buy as little as ₹1 of pure gold online (₹ the new Rupee sign as of 2010).

It also launched the Paytm Payments Bank and ‘Inbox’, a messaging platform with in-chat payments among other products.

In 2018, it started allowing merchants to accept Paytm, UPI and Card payments directly into their bank accounts at 0% charge.

It also launched the ‘Paytm for Business’ app, allowing merchants to track their payments and day-to-day settlements instantly.

The company also launched two new wealth management products – Paytm Gold Savings Plan and Gold Gifting to simplify long-term savings. And an Indian robo-advisor. Paytm Money with various mutual fund products.

It also stepped into gaming with a mobile games platform Gamepind.

Just a glance at the Economic Times under One97, is sufficient to realize how it continues to make the headlines:

Paytm registers 600% growth in UPI transactions in 6 months

Now, you can pay LIC premium through Paytm

One97 Mobility Fund, the ecosystem play

While One97 Communications is the proud mama of Paytm, they have launched a $100M fund that invests in early stage mobile companies  – the One97 Mobility Fund (OMF). Their portfolio currently includes:

  • Paytm
  • TheMobileGamerPublisher of mobile social games for South East Asia reaching out to over 500M mobile users.
  • Ciqual: enables Mobile Operators to improve their data services through customer insights.
  • RainingCloud Technologies: develops AppSurfer (previously known as DroidCloud), a platform enabling Android access across multiple devices like non-android phones and PCs.
  • Dexetra: focuses on Artificial Intelligence around personalized Search and Mobility.
  • Plivo: a cloud telephony solution which helps enterprises and service providers setup, manage and run their own private or public telephony clouds.
  • IImjobs: A job portal run focused on mid-to-senior level placements.
  • CRAFTBY PRODUCTS: Engrave is an India-based design collective engaged in the pursuit of creating lifestyle products with fine craftsmanship.
  • Santa Claus Couriers: is an Indian eCommerce platform
  • MobiSwipe Technologies: allows merchants to use Android mobile phones or tablets as Point of Sale.
  • Zepo Technologies: helps small business owners to setup their online shop.

Why One97?

197 was the telephone directory number in New Delhi. Vijay Shekhar Sharma launched a call center selling Astrology services over the phone, which he named as One97. Eighteen years later, One97 Communications is the 4th Fintech unicorn on the global marketplace. An Indian mobile internet company which has earned the liking of international large investors and which acts like an ecosystem.

[1] Included in the Redefining Financial Services newsletter

[2] Source:

Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.

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Blockchain Weekly Front Page: Legacy Finance, Big Tech and Government move into Blockchain


Last week our theme was “Silvergate Bank Plans to go Public.”

Our theme for this week is “Legacy Finance, Big Tech and Government move into Blockchain,

For more about the Front Page Weekly CXO Briefing, please click here.

Bitcoin and every cryptocurrency has dropped like a sack of potatoes, hitting lows they haven’t seen in over a year. The Bitcoin Cash fork war, the U.S. Justice Department probe into price manipulation by Tether and the Mt. Gox trustee that takes a big Bitcoin dump every now and then, are hard to ignore and have been causing tremors.

The market cap of all crypto is just $121.5 billion, and the entire ecosystem is hurting. Ripple overtook Ethereum in the number two spot, as ETH looks like it could drop below $100, something we haven’t in a while. This dip is hurting blockchain startups. Altcoins have difficulty showing product market fit, that would allow them to build the momentum they need to truly succeed.

Depending on the country they operate in, most miners have been drained by the continuous price decline on 2018. With the dropping prices, mining crypto has become an expensive proposition.


Has the market bottomed out yet? I have no idea, I am not in the speculation business.

Yet, some are even claiming crypto funerals are coming in 2019. Well, that just ain’t true. In the long-term, Bitcoin’s declining price could actually be a good thing for the market. It could rid us of all the shitcoins that are obsolete and don’t serve a real purpose.

The recent price drops have exposed for one more time, the delicate nature of cryptocurrencies and their perceived values. Personally, I think they show a complete lack of investor understanding of what is going on in the market. Last year we saw an irrational bull market, that’s been followed by this year’s irrational bear. Its crazy, considering all the market developments and positive sentiment in 2018.

Amazon sees a lot of opportunity with blockchain technology. Amazon introduced two new blockchain products for its AWS customers. It will offer Quantum Ledger Database and Amazon Managed Blockchain for developers, using its cloud-computing services. Customers will be able to deploy a blockchain network with a few clicks, that can scale to support thousands of applications running millions of transactions.

Switzerland’s national railway completed a proof of concept (PoC) digital identity pilot, to ensure railway construction workers had the appropriate qualifications to work on the railways. A year ago the City of Zug introduced a digital ID, that uses similar technology. In conjunction with Lucerne University, they used the IDs in a voting test at the end of June.

Today, December 2nd, marks the 10th anniversary of Satoshi Nakamoto’s whitepaper, Bitcoin: A Peer-to-Peer Electronic Cash System. This is a unique point in the history of money. Over the last decade. we have build a way where a few people no longer can control the wealth of people.

Crypto markets are undeniably down right now, and prices will always go up and down. What is important now, beyond any price, is to lay the foundation for more widespread adoption.

Bitcoin’s original vision is largely dependent upon the integration and adoption of new technologies that are still being built and tested. Solutions for decentralized exchange protocols, scaling and privacy, as well as better user interfaces, are all critical for overcoming Bitcoin’s current price volatility and gaining mainstream trust.

I think its not the time to give up on the market, be scared or let crypto critics that lack any sort of objectivity, influence your decision making. Do your research, understand what crypto is where it going and I think you’ll be able to make the right choices.

It might take another decade to get there, but in its first ten years, Bitcoin has become a potential alternative currency, and the game has only just begun.

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Ilias Louis Hatzis is the Founder & CEO at Mercato Blockchain Corporation AG. He writes the Blockchain Weekly Front Page each Monday.

From Treaty of Westphalia (start of national sovereignty) to global Blockchain governance to a more practical outcome =  arbitration clauses


People who geek out on code is law and law is code (I plead “guilty as charged your honour”), will love this. Busy entrepreneurs and executives may want to jump to the practical takeaway about international arbitration clauses.

The problem today is summed in the old schoolyard dialogue:

“I am right and you are wrong”

“Yea, who says?”

“I say”

“Yea, you and whose army?”

Law has to be backed up by credible force. Which is an issue when there are 195 countries, each claiming national sovereignty.

The Blockchain borderless alternative is not yet working, as we explore in the chapter of the Blockchain Economy book entitled why non state governance for bitcoin, ethereum and other cryptocurrencies is so hard. Irony aficionados enjoy the fact that about a year later after raising what at the time was record amount for an ICO to solve governance by code, Tezos collapsed into ye olde courtroom battles.

TL:DR. the legacy system is broken and the replacement system is not ready. Fortunately there is a practical hack which is international arbitration.

Treaty of Westphalia.

For historians and international jurisdiction lawyers, the Treaty of Westphalia in 1648 is the seminal event that led to the rise of the Nation State with the principle of Westphalian sovereignty. This is the principle in international law, enshrined in the United Nations Charter, that each nation state has exclusive sovereignty over its territory.

When I used to run an enterprise software company I recall the sometimes heated negotiation about which jurisdiction  was used in the contract. This was not an academic debate. In a dispute, you want to be on your home turf in a language and legal system that you are familiar with. That is a tough enough conversation  between two parties. What on earth do you do when the participants in a Blockchain contract maybe from hundreds of countries and the issuer maybe from an offshore jurisdiction (where there are simply not enough lawyers and judges to cope)?

Binding Arbitration

Our Advisory Services are known for their combination of big picture thinking with pragmatic execution. So, enough of the big picture thinking, lets move onto the pragmatic execution. If the legacy system is broken and the replacement system is not ready, what is the practical hack? The answer is a Binding Arbitration clause. 

Binding Arbitration is is a clause in a contract that requires the parties to resolve their disputes through an arbitration process, outside the courts.

It must be binding. All parties must accept the conclusion of the abitrators. If not, lawyers for one side will find a way to drive the dispute to the courts, making arbitration useless.

That means that the location for arbitration is critical.

Location for Arbitration

The location for Arbitration must meet these criteria:

  1. Big enough economy to have enough lawyers and expert witnesses. The disputes will be at the intersection of Blockchain technology and law and how many people understand enough of both to be part of a credible arbitration process?  Offshore jurisdictions usually fail on this score. The issuer jurisdiction does NOT need to be the same as the Arbitration Location.
  2. A rule of law that is globally respected.
  3. Good airports and plenty of flights (usually goes with 1).
  4. English language. It is the closest we have to a global language of business (much as we may not like the cultural erosion from less use of local languages).
  5. A time zone that works well globally.

Switzerland, where Tezos was adjudicated, met 1,2 & 3 bit not not 4 (although, as a Brit living in Switzerland, I can attest to the fact that English is widely used for global business done within Swiss borders). The Swiss brand around neutrality does help build confidence.

5 is where UK is better than USA, Canada or Australia, but it is a less critical criterium. I am seeing more arbitration clauses set in UK, which will be a boon for UK lawyers and expert witnesses (a smidgeon of good news among all the Brexit turmoil).

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Bernard Lunn is a Fintech deal-maker, investor, entrepreneur and advisor. He is the author of The Blockchain Economy and CEO of Daily Fintech.

Check out our advisory services (how we pay for this free original research). To schedule an hour of Bernard’s time please click here to send an email

Get fresh daily insights from an amazing team of Fintech thought leaders around the world. Ride the Fintech wave by reading us daily in your email.

Announcing the Daily Fintech Service: Book an Expert for an Hour

How many times have you read one of our posts and thought “I would like to pick up the phone and talk to the person with that knowledge and network”. Well now you can. You can book one hour for CHF 380 by simply sending an email to our Chief Commercial Officer (Julia Spiegel) requesting an hour’s consultation. We will schedule a time by email (we are in Europe, so we are time zone friendly for most of the world).  We will send you an invoice for your records by email and you pay for the hour by PayPal.

We start with one of the 6 Experts who write regularly on Daily Fintech. Bernard Lunn writes on Saturday from Switzerland about the Blockchain Economy. Bernard, CEO of Daily Fintech, is a serial entrepreneur, senior executive, adviser and strategic deal maker. He started in the engine room of Fintech for enterprise software companies (such as Misys, Temenos and ITRS). Bernard is the author of Mindshare to Marketshare and The Blockchain Economy and has used his media experience (for example as COO of ReadWriteWeb) to guide Daily Fintech since the first post on 29 June 2014. Bernard is a Brit who has lived in America, Singapore, India, London and Amsterdam and has done business in 40 countries. He currently lives in Switzerland.

We will be onboarding all the other people who write for Daily Fintech onto our Book an Expert for an Hour Service Service in the coming weeks:

Ilias Louis Hatzis writes on Monday from Greece about Blockchain, Bitcoin & Crypto. Ilias is an Internet entrepreneur who started his first company, an internet search engine, in the mid 90s during the dot-com era. Later on he founded several Consumer Internet and AdTech startups and went to work for Google and JWT. As well as still being an active entrepreneur, he mentors startups at the MassChallenge, MITEF and other startup accelerators and competitions. Having lived and worked in America, Ilias is currently back in his native Greece and is the Founder/CEO of Mercato Blockchain Corporation AG.

Efi Pylarinou writes on Tuesday from Switzerland about WealthTech and Capital Markets. Efi brings bold Wall Street experience (Salomon Brothers, Bankers Trust, SGCowen) in a broad range of asset classes (fixed income, structured products, hedge funds). She has lived and worked in the US, France, Greece, Canada, and Switzerland in investment companies, a university, an online education provider, and an executive consulting firm. She brings a strong academic background combined with a focus on breakthrough results. Efi is the author of Fixed income books with Frank Fabozzi.

 Jessica Ellerm writes on Wednesday from Australia about Small Business Finance. Jessica is CEO & Co-Founder of Zuper Superannuation, taking a new approach to superannuation savings. Previously she worked for Australia’s flagship Fintech startup and small business banking provider, Tyro. She is also a well-known expert on digital growth hacking and presents financial news and market updates for Australia’s leading online finance news provider, Finance News Network.

Zarc Gin writes on Thursday from China about Insurtech. Zarc is an analyst for Warp Speed Fintech, a Fintech, especially InsurTech-focused Venture Capital based in China.

Arunkumar Krishnakumar writes on Friday from UK about consumer banking.Arun has the experience and global mindset to cover innovation wherever it comes from globally and is equally comfortable in the world of big agile companies as well as scrappy upstarts. His big company experience includes Barclays and PWC. In his current role at Angels Unleashed, StartUp Bootcamp and Funding XChange, Arun works in the world of the scrappy upstart.

For those not familiar with CHF (the famously stable Swiss Franc) it is about par with the US$ today.

Many people requested an easy engagement model for our advisory service. Now you can start working with us by simply paying CHF 380 for an hour with one of our Experts. One day all consulting firms will make it this easy.

Request one hour of Bernard’s time for CHF380 by sending an email to Julia Spiegel (our Chief Commercial Officer)

Amazon vs Alibaba – the clash of the mighty techfins in numbers

We may have to soon rename ourselves as Daily Techfin. We have been focusing on the breaking of banks and their resistance to the Fintech avalanche, while Techfins have been slowly but surely capturing the FS world. Lots of numbers coming your way – so be warned.


Image Source

Money 2020 opened up in China, Hangzhou – the home of Ant Financial – for the first time this year. China is really were Fintech is happening at scale, and just by sheer numbers, the West look dwarfed. This is largely driven by the growth of Alibaba and Tencent.

Alibaba did $31 Billion in sales on Single’s day, and Amazon had its best sales in history through the 2018 thanksgiving period with 180 Million transactions.

Amazon haven’t announced exact sales revenues, but using Statista’s average online transaction size in 2017 of $81, their total sales could have been $15 Billion.

That just shows the scale of China vs rest of the world. Also, the total ecommerce sales number on Cyber Monday in the US was $7.9 Billion, that is just about 25% of what Alibaba achieved.

While the US Ecommerce market is set to reach $630 Billion by 2020, China’s is projected to be around $1.7 Trillion. Its fascinating to see how these two giants compare against each other in the ecommerce space. But, by Alibaba (Ant’s) own admission ecommerce and payments are just a foot in the door.

Some of the metrics discussed at Money2020 in China this year for different financial services that Ant offered were the following:

“1+N” – Onboard the customer with 1 QR-code – as payment technology. Cross sell marketing, training, cash management, loans, insurance etc.

“310” –  These are their KPIs for SME loans: 3 minutes for processing application, 1 second for monies in the bank, 0 manual work.

“212” –  Their KPIs for Insurance claims – 2 minutes for processing application, 1 second for review, 2 hours for insurance settlement to the account.

Stats Source here

This is only managed by cutting edge technology used with alternate data on consumers, to model their behaviour and assess risks in real time. I had already written about how Amazon helped an SME I knew, with a loan decision on the same day. Ant are just doing it better.

Now who is winning the battle? Amazon definitely have the global advantage. As of 2017 they had 2 Billion visitors per month, whereas Alibaba was at about 900 Million visitors per month. But that doesn’t necessarily translate into Financial Services that are provided by these firms.

In 2017 the number of Alipay users were 400 Million compared to Amazons 33 Million users, and as of September 2018, there were 520 Million Alipay users. Comparing transaction sizes is almost meaningless, as Alipay is light years ahead.

And all this with just 55% internet penetration in China (vs 78% in the US), with Alipay conquering 54% of China’s mobile payments. If payment services that the largest Techfin in the West does, is about 10% of that of the largest Techfin (of the East), it should give a perspective of what it means to other ancillary Financial Services such as lending, insurance etc., And if that is the comparison between the US and China, UK and European Fintechs perhaps won’t even come close.

I must confess that, I started this article wanting to just talk about Alibaba, China and Money2020. But when I started to look at the startling number differences between Amazon and Alibaba, I had to make it more of a comparison (although there is not much of a comparison).

An American friend of mine who recently visited China, mentioned that going to China felt like visiting the future. With the numbers that I have managed to dig out, China does feel like Wonderland when it comes to Fintech, thanks to its TechFins.

Arunkumar Krishnakumar is a Venture Capital investor at Green Shores Capital focusing on Inclusion and a podcast host.

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Pension Tech alive and well in Edinburgh

One of the winning teams from the FCA’s tech sprint

Yesterday I had the privilege of flying to Edinburgh to take part in the UK Financial Conduct Authority’s Pension Tech sprint event. The day was aimed at bringing together creative minds from inside and outside the pension industry in the UK, to try and tackle some of the biggest problems.

I’ve spent a week in London, and it’s been a good chance to get my head around where the local pension industry is right now, and the current dynamics. It’s especially interesting when comparing to where Australia is in its journey, and how the two can possibly learn or guide each other. While there is no doubt Australia is more advanced on a number of structural areas – both on the technology and regulatory front – the attitude and embracing of innovation in the UK, as witnessed at the FCA event was certainly unique and encouraging.

Prior to the trip I was fortunate to be the benefit of a private research report into the local pension sector. Below are some of the highlights that are worth being across, should you be seriously interested in this space.

  • The UK pension sector has seen revenue increase over the last 5 years – revenue is calculated by combining contributions and investment returns
  • Automatic enrolment is driving growth. It is estimated that revenue will grow at a compound annual rate of 3.3% over the next five years from £143.8 billion to reach £168.8 billion in 2022-23
  • 54.4% of the UK’s pension funds are based in London, with Scotland the second most important centre for pension funding, with schemes mainly located in Edinburgh and Glasgow. The region accounts for 12.3% of all pension funds
  • Occupational pension schemes hold 81.4% of all industry assets. Thanks to auto-enrolment they are expected to grow faster than personal pension schemes
  • There are now 41.1 million pension members in the UK, up from 39.2 million in 2016 and is the highest level ever recorded

Engagement with pensions seems to be mired by a lack of compelling reasons or useful and convenient online options. As a result:

  • 38% of employees have never viewed their pension online
  • Of those that have, 20% only do it once a year.
  • 19% of employees check their pension once a month, compared to 88% of people who check into their online banking regularly

Surprisingly, or perhaps not so surprisingly, if you think about the increasing importance of a pension as a source of stable wealth creation for younger people, Generation Z employees that were surveyed, the youngest respondents, were more likely to check their pension online than any other group. Only 3% of this group believe they are saving enough into their pension.

My take-aways from the trip

Auto-enrolment is great – and we know default systems can work – but many of the younger people I spoke to complained about having to enrol in a fund each time they changed jobs. We know multiple accounts are a significant cause of balance erosion. Not linking the plan to the person, but to the employer will create problems, especially for younger workers. For me this is a huge red flag.

One young man I chatted to said one pension fund forced him to withdraw his money, because he had been with the plan less than two years. He of course could have somehow found a way to add it to a new plan, but once money is out of the pension system and in our hands, the temptation to spend today is significant. Money inside a pension fund should not typically be accessibly until retirement age.

The pensions dashboard, which promises a view of all your accounts, online, could be a game changer, but only if every pension fund reports into it. At this point in time, from the discussions I had, it doesn’t appear there is a standardised reporting format or an onus on providers to comply. I could be wrong though. In Australia, the ATO Supermatch and Supertick service that provides this see-through and visibility for super fund members has been a big driver in engagement and consolidation.

Needless to say, there is significant opportunity for innovation in the UK around pensions, and they have a chance to possibly leapfrog or learn from the mistakes other more advanced pension markets, like Australia, have made. I certainly have some strategic thoughts about where the most significant opportunities lie, and it will be interesting to watch this market from down under over the next 12 months!

Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech. Jessica Ellerm is a thought leader specializing in Small Business and the Gig Economy and is the CEO and Co-Founder of Zuper, a new superannuation startup in Australia.