Token Reporter covers the world of cryptocurrency, token sales, and early stage startup funding. It is edited by John Biggs, formerly of the New York Times, Gizmodo, and TechCrunch.

Wednesday, February 14, 2018 

TokenReporter: A Peek At "How To Use Telegram"

This week I’d like to share with you a few of the tricks I use to gather data on upcoming ICOs and assess scams as they happen.

ICO discussions happen in three places: SlackDiscord, and Telegram. There are other chats in other spots and I’ll show you those in a week or so but for now please visit the App Store and pick up Telegram.

Telegram is popular because it allows for massive groups - there are some with 32,000 members - and is encrypted. They offer a number of versions including iOS, desktop, and Android. I use it primarily on iOS and all it requires for login is a phone number. I’m @johnbiggs if you join and you’re lonely.

There are two points when you fill find yourself needing telegram. First, most token sales use Telegram for their “shareholder” communications. For example, you’ll find things like this room for the IOTeX ICO which forwards you directly to the room. Further, you’ll find a number of interesting rooms dedicated to investing.

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Tuesday, February 13, 2018 

TokenReporter

The challenges of identity

Welcome back to TokenReporter

The Update

A reminder: This week at TokenReporter we’ve instituted a few changes. First, the newsletter will cost $20 a month or $100 a year (it is $60 a year for a limited time if you’d like to invite friends.) If you’ve received this newsletter in your inbox then you’re golden - I’m grandfathering in the 5,000+ folks who have been reading this for a while. This small amount of cash allows me to add a new mid-week post as well as hire some new talent so be on the lookout for changes in the system. I encourage you to tell friends and neighbors about the site and the newsletter.

Second, we’re expanding the newsletter to twice weekly, with a bit more token discussion coming to you every Wednesday. Look for it in your inbox this week. While you’re looking forward to that, why not take a glance back at last Wednesday’s?

… The fundamentals haven’t changed - nothing China or Singapore or the SEC can can “harm” cryptocurrencies. While I agree that regulation is sorely needed in the space, crypto is not a governmentally-controlled organization. It routes around damage like the Internet and it is literally impossible to stop unless its users stop trading. Smell a little like a Ponzi scheme? Ehhhh… the jury is still out but I support the technology because it is a technology and not a financial instrument. The Internet of Value is probably the first technology of the 21st century to enact global change.

Sponsors

Typewriter.Plus offers white paper editing, website proofreading, and presentation management for startups. Our rates are low and our experts have worked at the New York Times, Gizmodo, and other amazing tech sites. Upload your document today or try our inexpensive Startup Pitch Pack.

MetaCert - MetaCert protects companies of all sizes from risks when using messaging apps. This is especially important when running a token sale and ensuring every link in your Slack is secure.

What to reach 5,000+ crypto fanatics? Email joanna@cabalpartners.com

This week’s quick thought

I’m thinking a lot about identity this week - identity in chatbots and reputation in all of the ICOs focused on paying for advice and knowledge with tokens, identity and reputation in education ICOs that pay based on knowledge and reputation, as well as the bigger problems that UN ID2020 is trying to solve- there are a billion people who don’t have any identification at all, which wouldn’t have been a problem a few centuries ago- people could move about the world freely without passports, without ID, and create trust locally. (Not that things were rosy then, either: poverty was greater, life expectancy was shorter. ID plays a role in that, too, in terms of health service delivery.) Now the world expects ID to establish trust, but that ID has to be based on a trusted authority or system… so how we decentralize identity, while giving the user control over it to share different parts at their discretion, to gain access to services is a big problem. There’s so much more to solve here than just recreating Kloutscores for people - the last 20 years of internet are littered with failed identity solutions, whether it’s just multi-site sign-in (Google, Facebook, Twitter, Microsoft), or trying to establish reputation (Klout), or the history of credit agencies (hello, Equifax.) With that in mind, read on about the ICOs I’ve looked at this week, and the news.

Two token sales to watch 👁️

Bottr.me is a smart messaging platform that makes it easy to create a chatbot to share with your followers. You create a bot, save questions as smart replies to give users pre-filled bits to start dialogue off, and people can tip you or pay for priority answers in their token, botcoin. Bottr is really four things: a personal AI powered identity for connection and communication (chat bot), a cryptocurrency to put value on a contribution and act as a medium of exchange (Botcoin), a social reputation measure for trust and governance (Botscore), and a transparent and secure blockchain based infrastructure layer (Botchain). They’re backed by 500Startups. Honestly, it strikes me a little like Reddit Gold, where people pay money to buy ‘gold’ to tip other users. Here, it merges it with a chat platform, adds utility to the coin beyond the first purchase. Bottr states explicitly that the tokens are not an investment, not a security. It’s worth a look. Here’s the link to the whitepaper.

Tutellus.io is one that catches my eye. Here’s why: They’re a learning platform that’s been around since 2013, has over 1M students, more than 1 Billion minutes spent learning, and 10M USD in transactions, across 20 countries. They’re making a new platform, growing to 160 countries, tokenizing it, and want to flip things around so that students get paid for learning. Teachers get instant payments, and earn money through relevence*. They also stand to earn with the best students, and students get paid for learning. The token gets used for payments to students, teachers, and making things affordable for countries with high inflation rates. It also can be used to pay for teacher services and company services for companies who wish to hire out of it. *Relevance is defined as the measure of knowledge and activity in a skill. They’re attempting to solve education problems like availability, affordability, and motivation on both the student and teacher’s part, as well as make for an easy recruiting pool for companies. Read the whitepaper.

The Good, the Bad, and the Ugly 😊😠👹

😊GOOD: Microsoft is working on using blockchain tech to create a scalable digital identity platform. Here, they’re rolling it into their Microsoft Authenticator application, a 2factor auth app. It isn’t the first time that MS has worked on identity, and it’s something Facebook spends a lot of effort on as well. Microsoft and blockchain alliance Hyperledger are both a part of the United Nation's ID2020 project, which aims to achieve a secure and verifiable digital identification system that can scale. When it comes to identity, I always have concerns about the user losing control of what their ID says about them, and how much or little they share based on context. Dick Hardt used to talk about this in his Identity 2.0 deck years ago. Google Plus talked about this with their attempt to segment social into ‘circles.’ Neither solution caught on, but the problem still remains. MS’ blog post by Alex Simons and Ankur Patel does mention "empowering every person to own and control their Digital Identity.” 

😠BAD: JP Morgan joins four other banks to ban crypto transactions made with credit and debit cards, saying that they’re just too volatile, and that these transactions would not be honored. At the same time, there’s a report out from JP Morgan suggesting thatcrypto could help diversify portfolios. “CCs are unlikely to disappear completely and could easily survive in varying forms and shapes among players who desire greater decentralization, peer-to-peer networks, and anonymity, even as the latter is under threat.”


👹
UGLY: BitConnect lawsuits are mounting in Florida, naming all of the directors as defendants, seeking a jury trial. If they do get the jury trial, then the directors’ personal assets could be at stake.

News 🆕

T-Mobile is quietly working on blockchain using Hyperledger. They’ve been a part of the Sawtooth 1.0 development, and it’s expected that the implementation will solve identity and access management pain points that T-Mobile has as they work to scale up their cloud solutions. T-Mobile has a number of open source software projects, including Keybiner and Jazz which are also focused around cloud and identity. T-Mobile has 69 million subscribers.

Disclosure

We will run advertising in the newsletter and if would like to appear at the beginning or end of this newsletter please email joanna@cabalpartners.com We do not expect that we will run a token sale to fund this newsletter but Victor or I may run our own token sales later in the year.

By accepting this material, you acknowledge, understand and accept the following:

This material has been prepared at your request by Cabal Partners, LLC (“Cabal Partners, LLC”). This material is subject to change without notice. This document is for information and illustrative purposes only. It is not, and should not be regarded as “investment advice” or as a “recommendation” regarding a course of action, including without limitation as those terms are used in any applicable law or regulation. This information is provided with the understanding that with respect to the material provided herein (i) Cabal Partners, LLC is not acting in a fiduciary or advisory capacity under any contract with you, or any applicable law or regulation, (ii) that you will make your own independent decision with respect to any course of action in connection herewith, as to whether such course of action is appropriate or proper based on your own judgment and your specific circumstances and objectives, and (iii) that you are capable of understanding and assessing the merits of a course of action and evaluating investment risks independently. Cabal Partners, LLC does not purport to and does not, in any fashion, provide tax, accounting, actuarial, recordkeeping, legal, broker/dealer or any related services. You should consult your advisors with respect to these areas and the material presented herein. You may not rely on the material contained herein. Cabal Partners, LLC shall not have any liability for any damages of any kind whatsoever relating to this material. No part of this document may be reproduced in any manner, in whole or in part, without the written permission of Cabal Partners, LLC except for your internal use. This material is being provided to you at no cost and any fees paid by you to Cabal Partners, LLC are solely for the provision of investment management services pursuant to a written agreement. All of the foregoing statements apply regardless of (i) whether you now currently or may in the future become a client of Cabal Partners, LLC and (ii) the terms contained in any applicable investment management agreement or similar contract between you and Cabal Partners, LLC.

Wednesday, February 7, 2018 

TokenReporter: What, me rally?

A reminder: This week at TokenReporter we’ve instituted a few changes. First, the newsletter will cost $20 a month or $100 a year (it is $60 a year for a limited time if you’d like to invite friends.) If you’ve received this newsletter in your inbox then you’re golden - I’m grandfathering in the 5,000+ folks who have been reading this for a while. This small amount of cash allows me to add a new mid-week post as well as hire some new talent so be on the lookout for changes in the system. I encourage you to tell friends and neighbors about the site and the newsletter.

Second, I’m expanding the newsletter to twice weekly, with a bit more token discussion coming to you every Wednesday. Look for it in your inbox this week.

Now on with the show.

JB

Sponsors

Typewriter.Plus offers white paper editing, website proofreading, and presentation management for startups. Our rates are low and our experts have worked at the New York Times, Gizmodo, and other amazing tech sites. Upload your document today or try our inexpensive Startup Pitch Pack.


MetaCert - MetaCert protects companies of all sizes from risks when using messaging apps. This is especially important when running a token sale and ensuring every link in your Slack is secure.

What to reach 5,000+ crypto fanatics? Email joanna@cabalpartners.com

Need to Know 🚀

This week has been tough on both equities and tokens. Bitcoin, Ether, and most ERC 20 compatible tokens - essentially the tokens used by most ICOs - took a beating. As one friend wrote on Facebook: “This is a hard week to launch a token sale.”

What is causing the dip and how low (or high) will it go? As I posited on Monday, the news cycle for crypto is a mess. A post that goes up one day will counter a post the next day. Conspiracy theories run rampant and an ounce of SEC clarity is enough to move the market by $2,000. From CoinDesk:

"I believe every ICO I’ve seen is a security," Securities and Exchange Commission chairman Jay Clayton declared early on, perhaps setting the tone on a topic that would be raised numerous times during the roughly two-hour hearing. He largely echoed his past remarks on the subject, criticizing the “gatekeepers” of such offerings in the market today.

At one point, Massachusetts Senator Elizabeth Warren asked Clayton whether any ICO, past or future, had been subject to SEC registration.

"Not one," he answered to both.

What do you need to know this week? Two things:

  1. Fundamentals haven’t changed - nothing China or Singapore or the SEC can can “harm” cryptocurrencies. While I agree that regulation is sorely needed in the space, crypto is not a governmentally-controlled organization. It routes around damage like the Internet and it is literally impossible to stop unless its users stop trading. Smell a little like a Ponzi scheme? Ehhhh… the jury is still out but I support the technology because it is a technology and not a financial instrument. The Internet of Value is probably the first technology of the 21st century to enact global change.

  2. Bitfinex could cause a halving of BTC price - I am currently investigating a number of very interesting claims that purport that major Bitcoin exchange Bitfinex has been propping up bitcoin prices with something called wash trading - allegedly creating transactions that make it look like like real activity, thereby maintaining inflated prices. The more I dig the stranger things become, as I always recommend, please use a hardware wallet like Trezor to keep your horde in cold storage. I rarely if ever maintain a balance on any exchange.

    I’ll keep you posted on the Bitfinex exploration.

See you next Monday!

Best,

JB

Monday, February 5, 2018 

TokenReporter: Popping that Bubble

This week at TokenReporter we’ve instituted a few changes. First, the newsletter now costs $9 a month or $60 a year. If you’ve received this newsletter in your inbox then you’re golden - I’m grandfathering in the 5,000+ folks who have been reading this for a while. This small amount of cash allows me to add a new mid-week post as well as hire some new talent so be on the lookout for changes in the system. I encourage you to tell friends and neighbors about the site and the newsletter.

Second, I’m expanding the newsletter to twice weekly, with a bit more token discussion coming to you every Wednesday. Look for it in your inbox this week.

Now on with the show.

JB

Sponsors

Typewriter.Plus offers white paper editing, website proofreading, and presentation management for startups. Our rates are low and our experts have worked at the New York Times, Gizmodo, and other amazing tech sites. Upload your document today or try our inexpensive Startup Pitch Pack.


MetaCert - MetaCert protects companies of all sizes from risks when using messaging apps. This is especially important when running a token sale and ensuring every link in your Slack is secure.

What to reach 5,000+ crypto fanatics? Email joanna@cabalpartners.com

Feature: Where do we go now?

The crypto crash is reverberating through the Internet while the "rest" of the economy - namely the stock market - enters free fall. Commentary on the very human and thus flawed stock market is still well within the realm of pundits and guys who press funny buttons on TV, whither crypto?

First, the die hards are chiming in noting that they are retaining their investments - HODLing, as it were. Still others are buying. My favorite crypto-pundit, Jameson Lopp, chimed in today:

And the mysterious "Bitcoin content creator" Vortex brings up a very important point:

First, I don't think this is the bottom of the fall. Expect things to hover around $5,000-$10,000 or even a bit less as the folks begin thinking long and hard about why they're in the space. I suspect we'll see a rise in interest as Wall Street bonuses are paid out this month and savvier investors "buy the dip."

But what cause this and why am I still bullish on the market? First, we have news that China has banned foreign crypto exchanges. Writes CoinTelegraph:

China will add offshore cryptocurrency exchanges and ICO websites to its Great Firewall, the South China Morning Post reported Monday, reported Feb. 5, quoting a publication affiliated with the People’s Bank of China (PBoC).

This sort of news - seemingly definitive and seemingly catastrophic - is actually a dud. In China the Great Firewall is not nearly as effective as the government would have you believe. While it does lock out the inexperienced or non-technical investor, I doubt many of the miners or crypto exchanges are worried. VPNs - essentially ways to circumvent the Great Firewall - are easily available. In short, this has no teeth and the panic selling associated with this will eventually stop as investors figure things out.

We must understand the FUD cycle for cryptocurrency is very strong. While Microsoft and other entrenched enterprise players had a lot of skin in the game when it came to talking down and trying to bury Open Source and, more specifically, Linux, the Internet of Value is dealing with real money and real economies. The drive to take control of all sides of the equation is great and ultimately it will be subsumed, just as many open source platforms have been subsumed, into the fabric of the Internet.

Betting on crypto is a bet on a new way of doing this. I discussed analogs to this current market to a fascinating investor who has watched the rise and rise of the Internet and she equated the current crypto market to the Internet in 1993 - it was there, it wasn't popular, and it would take a few short years to enter our lives and change it permanently. We also must remember that computer networking has been around since the late 1960s yet it did not permeate our lives until about the turn of the century. In 1993 we were reading email on Elm and editing our away messages with Vim. Now we think nothing of dashing off a Word document to someone a thousand miles away and expecting it to arrive safe and unharmed. The same is not yet true of, say, a payment to a contractor because middle men and heritage technologies are ensuring we must all sit on our hands while tools like SWIFT and ACH muddle along.

We all know that something big is happening. Whether it's tied to BTC price or not is uncertain, but we do know that these technologies have a part to play in our brave new future.

Two tokens to watch 👁️

Metal is one we’ve talked about before but it is definitely one of the few companies with a solid CEO, solid product, and actual code. It is also one of the few tokens you can trade right now. It is available for conversion on Binance (although I wouldn’t keep my cash on Binance right now, especially given the China news.) The company has its own wallet, called the MetalVault, and the fundamentals on this token are strong.

Spherepay just launched its SAY token in Singapore. The mission is to let users buy actual things - clothes, groceries, etc. - with the SAY, creating a decentralized cryptocurrency that is actually spendable in the world. The mission is similar to Metal’s and I would argue that anything in the payments space is a no-brainer when it comes to the need for a real, usable token. You can read the white paper here.

The Good, the Bad, and the Ugly 😊😠👹

😊GOOD: Singapore Airlines is creating a blockchain-based loyalty wallet, a move that points to increased adoption of enterprise blockchain tech. This is another perfect problem for crypto to tackle and I expect we’ll see more moves like this in the next few months.

😠BAD: The true value of the equities market is being tested by Wall Street as the down falls 1,000 points. These types of corrections are common and, all told, the market has lost more than the Bitcoin market cap. Everybody hurts.

👹UGLY: The Equifax probe is “on ice” after the company leaked millions of personal records from 143 million Americans. The Consumer Financial Protection Bureau will no longer investigate Equifax for the breach. From Reuters: “Three sources say, though, Mulvaney, the new CFPB chief, has not ordered subpoenas against Equifax or sought sworn testimony from executives, routine steps when launching a full-scale probe. Meanwhile the CFPB has shelved plans for on-the-ground tests of how Equifax protects data, an idea backed by Cordray. “


News 🆕

Hackers are working hard to phish cryptocurrencies according to security firm Kaspersky. The phishing attempts often appear as password resets for popular exchanges including Coinbase and Kraken and encourage users to type in their passwords. Kaspersky writes:

The simplest version of cryptocurrency phishing, aka cryptophishing, involves good old-fashioned spam mailings. In this case, such e-mails appear to originate with providers of cryptocurrency-related services — Web wallets, exchanges, and so on.

The messages are markedly more detailed and sophisticated than the average phishing e-mail. For example, one might be a security alert saying that someone just tried to sign into your account from such and such address using such and such browser — all you have to do is click the link to check that everything’s OK. The potential victim might even have requested such messages on the cryptowallet site, in which case they will notice nothing untoward.

Please, please, please check your browser URL bar before doing anything on an exchange. If you don’t see the site’s name and you don’t see a little padlock you’re going to have a bad time.

Disclosure

We will run advertising in the newsletter and if would like to appear at the beginning or end of this newsletter please email joanna@cabalpartners.com We do not expect that we will run a token sale to fund this newsletter but Victor or I may run our own token sales later in the year.

By accepting this material, you acknowledge, understand and accept the following:

This material has been prepared at your request by Cabal Partners, LLC (“Cabal Partners, LLC”). This material is subject to change without notice. This document is for information and illustrative purposes only. It is not, and should not be regarded as “investment advice” or as a “recommendation” regarding a course of action, including without limitation as those terms are used in any applicable law or regulation. This information is provided with the understanding that with respect to the material provided herein (i) Cabal Partners, LLC is not acting in a fiduciary or advisory capacity under any contract with you, or any applicable law or regulation, (ii) that you will make your own independent decision with respect to any course of action in connection herewith, as to whether such course of action is appropriate or proper based on your own judgment and your specific circumstances and objectives, and (iii) that you are capable of understanding and assessing the merits of a course of action and evaluating investment risks independently. Cabal Partners, LLC does not purport to and does not, in any fashion, provide tax, accounting, actuarial, recordkeeping, legal, broker/dealer or any related services. You should consult your advisors with respect to these areas and the material presented herein. You may not rely on the material contained herein. Cabal Partners, LLC shall not have any liability for any damages of any kind whatsoever relating to this material. No part of this document may be reproduced in any manner, in whole or in part, without the written permission of Cabal Partners, LLC except for your internal use. This material is being provided to you at no cost and any fees paid by you to Cabal Partners, LLC are solely for the provision of investment management services pursuant to a written agreement. All of the foregoing statements apply regardless of (i) whether you now currently or may in the future become a client of Cabal Partners, LLC and (ii) the terms contained in any applicable investment management agreement or similar contract between you and Cabal Partners, LLC.

Friday, February 2, 2018 

Welcome To TokenReporter Beta

Hi, it’s John Biggs.

I’ve been sending out TokenReporter for a few months now and I hope it’s helped you understand the token and crypto space a little better. We want to ramp up now so we’re doing something brand new: a bi-weekly newsletter that comes on Mondays and Wednesdays. But we need your help.

If you are getting this email you’ve already been added to our subscription service and you don’t have to pay anything. New users will have to pay $7 a month or $60 a year to get access to our news. This subscription will fold over into other projects I’m working on in the crypto space and it’s my goal to create the Wall Street Journal of crypto: real, non-enthusiast media dedicated to these amazing new markets. What we did at sites like Gizmodo and TechCrunch I want to do for the new, new startups who are entering into the brave new world of crypto.

Please help us out by Tweeting about the project or sharing it on Facebook.

Would love your feedback as well. Email me at john@biggs.cc and tell me what you think and let’s talk about your projects. I’m very excited about this space and I want us all to move forward together.

All the best and I hope all is well.

JB

Token Reporter covers the world of cryptocurrency, token sales, and early stage startup funding. It is edited by John Biggs, formerly of the New York Times, Gizmodo, and TechCrunch.