CoinDesk’s “Consensus: Invest 2018” Conference – 5 Most Important Interviews


Yesterday, Coindesk organized a “Consensus: Invest 2018” conference in New York. The much-anticipated event was organized with the aim to deliver discussions and debates around trends and investment opportunities for digital assets. The agenda was packed with as many as 40 sessions involving more than 100 speakers.

Newconomy covered the event and here are the five most important interviews:

1 – SEC Chairman Clayton Wants Key Improvements Relating to Market Manipulation

Probably the most anticipated interview at this year’s conference has been the one with Jay Clayton, the Chairman of the U.S. Securities and Exchange Commission (SEC). His interview mostly focused on the legal aspect of the cryptocurrency ecosystem, which is understandable given his position. Here is the summary of his interview:

  • Key market improvements in the context of regulation and security have to be made before the SEC gets more comfortable approving the first bitcoin ETF. So far, the Commission has rejected multiple applications for a cryptocurrency-based ETF.
  • The market surveillance mechanism has to be established to monitor, prevent and investigate abusive and manipulative activity on the exchanges. Such systems are present in the traditional stock exchange. “Those kinds of safeguards do not exist currently in all of the exchange venues where digital currencies trade,” Clayton added. According to him, investors want ETFs, which make sense and are free from the risk of manipulation. “The prices retail investors are seeing are the prices they should rely on, and free from manipulation – not free from volatility, but free from manipulation,” he concluded.
  • Custody over assets is another “major roadblock”. Investors want to feel secure over the safety of their assets while adding that “…some thefts around digital assets make you scratch your head”. The underlying notion in this area is that assets must have great custody and that they won’t disappear.
  • Clayton advised ICOs to start with the assumption that what they offer is actually the securities offering, thus it is subject to SEC laws. However, he agreed that not all of the tokens fall within the same category. This statement is in line with the previous messages from the SEC that they won’t bend the rules for cryptocurrency when it comes to defining what is or what isn’t security.

2 – Nasdaq and VanEck Partnership Announced

Nasdaq inc, the second-largest stock exchange in the world, announced a partnership with the investment firm VanEck with the goal of bringing regulated crypto 2.0 futures-type contract to the market.

The partnership was announced by Gabor Gurbacs, director of digital asset strategy at VanEck, who attended the conference in the capacity of the speaker. According to him, the first such product is planned to go live in the first quarter of 2019.

“What I’d like to point out is we ran a few extra miles working with the CFTC (Commodity Futures Trading Commission) to bring about new standards for custody and surveillance,” he said during a panel.

These products are one of the potential solutions to the above-mentioned concern by SEC Chair Clayton over market manipulation. The Nasdaq’s SMARTS – market surveillance system – is being used as a role model as Gurbacs labeled the system as a  “big policeman engine”.

He concluded that “2018 was the year of regulation and 2019 will be the year of implementation”.

3 – ICE’s ETF Product Will Go Live Early Next Year

A couple of days ago, it was reported that Intercontinental Exchange (ICE), the owner of New York Stock Exchange, is delaying its formal launch of bitcoin futures product to January 2019.

Bakkt is a regulated ecosystem for cryptocurrency, developed by ICE.

The Conference hosted both Jeffrey Sprecher, the founder, chairman, and CEO of Intercontinental Exchange (ICE), and Kelly Loeffler, the CEO of Bakkt. According to the latter, the recent drop in bitcoin prices is not really a factor for Bakkt as “there’s a lot of missing infrastructure and use cases”.

Answering the question regarding the delay in the launch of the first product, Loeffler said it was partly due to “the pipeline filled up with customers”. In addition, the postponement increases the chance of success as it will be launched after the holiday season.

She said that the main goal of Bakkt is to create “an open and regulated, global ecosystem for digital assets. If you think about commodities or equity indices, the S&P500, that price is established in a federally regulated market, we don’t have that in the crypto market today. That’s what we’re focused on bringing along with a myriad of other features,” concluded Loeffler.

4 – Allianz Bank’s Chief Advisor: Cryptocurrency Usage Will Become More Widespread

Mohamed El-Erian, Chief Economic Advisor at Allianz Bank, spoke about the future outlook of the cryptocurrencies. For him, the recent sell-off did not come as a surprise since this can be seen as a healthy development for the market.

“I do believe this is not, you know, going to disappear. It’s just finding its place in the ecosystem,” said El-Erian. He added that cryptocurrency usage will become more widespread, not as a separate entity but rather as a part of the existing global ecosystem. “They will not be dominant as a lot of the early adopters believe they will be,” added El-Erian.

He notes a growing interest in the cryptocurrency industry by the institutional side. When asked about Warren Buffet’s comments about bitcoin being is a “probably rat poison squared”, El-Erian justified Buffet’s comments.

“When people saw it was going straight up and saw who was getting sucked into this phenomenon, they started warning. And I do think those were appropriate warnings,” answered El-Erian.

Interestingly, he El-Erian said he had opened a bitcoin account for $400, but only for the purpose of testing it.

5 – Harbor Launches Security Token Compliance Platform

Similarly to Nasdaq and VanEck partnership announcement, Consensus: Invest 2018 conference was used for the launch of the security token compliance platform by a blockchain startup called Harbor.

The startup raised $28 million from major Silicon Valley venture capital firms earlier this year.

Speaking at the conference, Harbour’s  CEO Josh Stein, announced that Harbor is now allowing investors to register to buy shares in an apartment block called “The Hub” at Columbia, South Carolina. The block is owned by the real-estate portfolio of DRW Holdings – Convexity Properties.

Investors are now able to buy 955 available shares, represented by the same number of tokens. Each token costs $21,000, disclosed Stein. Once purchased, the platform developed by the company allows tracking of the security token, thus ensuring that token sales are “compliant every time, everywhere.”

By setting the price at $21,000, which is also the minimum requested stake, Harbor wants to attract a larger number of investors to participate in the offering, as the sum is significantly less than in the conventional offering. The limit of investors is set at 2,000 for the regulatory purposes, as a higher number of investors would mean the company has to go public.