Monday, 25 September 2017

A Analysis

Press Release

ICODAO: Autonomous Robot That Obsolesces Bankers, Funds Managers & VCs

For Immediate Release - NY

Upfront:

  • Reincarnation of the DAO, done correctly

  • Autonomous robot selects ICOs and startups without a fund manager or VC

  • Use of “Zero Margin” model drives prices and compensation through the floor - Excellent for consumers, death knell for fund managers/VCs.

  • Powered by one of the most prescient strategists in the business

  • The future of finance, ICO slated for April 25th, 2107 at US market open

 

The man that called Bear Stearns, Lehman, the real estate and EU sovereign debt crashes as well as mobile tech booms is now mobilizing his films blockchain technology to go head-to-head with the captains of global industry - Wall Street. Unlike the vast majority of blockchain tech start-ups that strive to improve upon the business processes within the leaders of the finance , Reggie Middleton’s Veritaseum seeks to disintermediate said leaders in totality, thereby releasing an unprecedented cascading wave of value currently tied up in excessive fees, commissions and economic ents.

This disintermediation is accomplished by using a DAO (digital autonomous organization consisting purely of distributed software that lives on no single computer or server) which is essentially a smart contract (autonomous computer code, analogous to a legal or social contract that produces y or z result after X input, contingent upon the input).

Veritaseum’s ICODAO will have the ability to accept requests for Eth from prospective ICO issuers, evaluate said requests and if the requests past muster from the DAO’s perspective, then dig in deeper with due diligence and proprietary analysis to ascertain whether the offering will be participated in.

This occurs at a cost that is up to 90% cheaper than fund-like vehicles, meaning the ICODAO token holders (those who submitted Veritaseum’s Veritas tokens to the DAO) stand to benefit significantly more than those who may have invested in a fund with a similar gross return and risk profile, reference this complete illustration for more).

Reggie Middleton the Veritaseum team will support the ICODAO with analysis and development services. ICODAO takes robo-investing and brings it to a new, autonomous and significantly more paradigm shifting level, threatening the highest paid of professional financial investors - VCs and fund managers.

Veritaseum is planning its own ICO (initial coin offering) on April 25th, starting at the open of NY financial markets, through May 26th or as long as supply lasts. Click here for more information.

###

Download the Veritas deal sheet, 

Contact:

Reggie Middleton

This email address is being protected from spambots. You need JavaScript enabled to view it.

1-718-407-4751

Skype: reggie.middleton

Web-ready logo https://blog.veritaseum.com/images/logo/latest_logo.png  

Virtual roadshow https://docs.google.com/presentation/d/1FMyNvogofqojqG6nkIjgvvjAnsWs1qOtKUFExvtp_m0/pub?start=false&loop=false&delayms=3000&slide=id.p

On disripting hedge funds and VCs https://blog.veritaseum.com/current-analysis/1-blog/220-reggie-middleton-shows-what-happens-when-the-fund-fee-fight-hits-the-blockchain

Pathogenic Finance https://youtu.be/_vf8-Hl78pM

Veritaseum: Ushering in the P2P Capital Markets

Veritaseum is in the process of building peer-to-peer capital markets that enable financial and value market participants to deal directly with each other on a counterparty risk-free basis in lieu of going through middlemen, intermediaries and authoritative 3rd parties. We are holding an ICO for our Veritas tokens: the sole means of accessing the vehicles for the P2P economic markets. Here is an overview of the ICO details. The online Veritas presentation deck is rich with descriptions and links to other documentation and instructions on participating should you want to dig in deeper.

The Veritas deal sheet is now available for download.

Veritas Deal Sheet

Executive Summary

  • Veritaseum is to be considered a gateway, or onramp to the P2P economy, akin to how a browser is used to access the World Wide Web, or a Bitcoin or Ethereum wallet is used to access those distributed ledger platforms.

  • Veritaseum’s wallet uses a layman friendly interface to build, distribute, read and execute smart contracts.

  • The Veritaseum wallet interacts with Bitcoin and (soon) Ethereum blockhains and oracles to conditionally store and transfer value.

  • Veritaseum’s primary competition will initially  be the sell side Wall Street status quo. Its aim is two-fold:

    • o provide autonomous asset management and investment vehicles (DAOs) at near zero profit margin, drawing assets from the more traditional players and then selling information, data and advisory services on top of it;

    • Enable self-service P2P smart contract transactions over-the-counter, that mimic the transactional services of the legacy players, at considerably lower cost and without balance sheet exposures, credit risks or counterparty risks.

      • This near zero margin model will be replicated as a platform across the entire FIRE sector (finance, insurance and real estate), and then to sharing economy models (ie. Uber, AirBbB).

  • Veritas launched a long-running beta of its OTC value trading platform in 2013 and claims to not only be the first publicly viable P2P capital markets implementation of smart contracts technology but to to be the first to file for patent protection of the same.

  • Management pulled the Wallet from public access soon after the CFTC announced their regulation of bitcoin out of concerns of a requirement to register as an SEF (swap execution facility). Management’s goal is to be, and to remain, solely a software, software data services and advisory provider - and explicitly not a financial concern.

  • Veritaseum is moving to the Ethereum blockchain, while still retaining exposure to the Bitcoin token, in order to broaden its smart contract capabilities.

Product: What is Veritaseum Providing and How?

Veritaseum provides direct access to smart contract construction, execution and related products the non-technical individual. This direct access facilitates access to what Veritaseum management has coined the “Peer-to-Peer capital markets” - essentially an ever growing pool of users who transact value directly with each other instead of through intermediaries and middlemen, ie. Wall Street banks and brokerages. Veritaseum sees highly customizable and programmatic, direct, P2P transactions as the future of capital markets.

In addition, with the advent of low cost networking and geographically aware computing power (smart phones), blockchain tech and smart contracts, the concept of transferable value is easily expanded past real and financial assets to privacy, labor, data and a cornucopia of things none of us have through of yet.

All assets are stored client side, fully encrypted and are always in the complete control of the client (i.e., you, the individual user). Veritaseum doesn’t even store encrypted copies on its servers. Even in the event of a password compromise, bad actors must also locate the assets to access them. Something that is much easier to do on a centralized server (e.g., JP Morgan or Citibank) than a fully distributed system.

With Veritaseum, one can literally tweet an entire trade, or click a Friend on Facebook to take the other side of a short Goldman long Facebook trade, or transfer BTC linked to the price of gold through a text message. All without having to trust who’s on the other side! This level of friction free finance leads to the inevitable…

Pathogenic Finance - the Rise of Viral Financial Transactions

In the legacy financial world, in order to open a bank account, you have to present various forms of ID, go through multiple levels of KYC/AML, and wait a few days for funds to clear. In order to open a brokerage account, you have to fill out forms, answer questionnaires, meet minimum account balances and wait up to 3 days for funds to clear and 10 to 20 business days for assets to be transferred from account to account. All this is done to essentially remand control, custody, possession, and ownership of your funds and assets to a centralized hosted wallet (bank or brokerage) with oodles of balance sheet exposure to other centralized hosted wallets (banks, brokerages and exchanges). In return, you are given a promise not to plunder. With Veritaseum, you can create multiple accounts in under 60 seconds. You can start trading and transacting with others almost immediately, and in all cases no less than 60 minutes provided you have bitcoin on hand.

 

This ability to do practically everything your bank and brokerage offers through your browser (for dramatically less money) on practically any web-connected device with a modern browser, practically anywhere, with almost anyone, and without having to trust them inevitably leads to a massive proliferation of transactions. This proliferation will spread exponentially, not linearly, as more and more people realize they have been essentially freed from the “Matrix”.

·       This is what AT&T was afraid of in 1915, causing them to miss out on roughly 7 billion “new” customer accounts, and potentially controlling the telecommunications space.

·       This is what AOL was afraid of in the mid to late ‘90s, causing them to go from the Internet access market leader to an “also ran” in the space.

·       This is what the banks and financial industry are fighting against now, likely to have no more success than their historical compatriots in other industries.

This growth and proliferation in peer-to-peer transactions, is truly viral. The outbreak will not be media or telecomm this time around, but the very meaning, application, and use of money and value itself! This is the dawn of “Pathogenic Finance”!

What is the Disruption of the Normal Physiology of the Legacy Finance Mechanism?

Autonomy vs. Heteronomy

A pathogen is an infectious agent that disrupts the normal physiology of an organism. In this case, the disease is a new cultural meme. Pathogenic finance is a concept discovered and coined by Reggie Middleton, Disruptor-in-Chief at Veritaseum. Veritaseum acts as a virion (infectious virus particle) for carrying new pathogenic cultural memes, ideas, and practices of finance that can be transmitted from one mind to another through writing, speech, rituals, or media. Regardless of what the meme is transmitted through, it is transmitted by… Veritaseum. It is analogous to a virus in that it self-replicates, mutates, and respond to selective pressures on organisms to evolve (i.e., changes in habitat, weather, food availability and type, etc.). Veritaseum, like its biological counterpart, can infect multiple forms found throughout multiple ecosystems. Viruses are the most abundant type of biological entity. Being that Veritaseum now lives as a web page, it can live and multiply anywhere there’s an Internet connection and modern browser. Any geographic location, any device, any user. All it takes is a single Tweet, text, email, or drag and drop to get Veritaseum value transactions to spread and multiply.

Why is the Veritas token needed?

The Veritas token will act as the key and only gateway to access the contracts that build the P2P capital markets. The Veritas token is easily programmed (by the non-technical user) to take on the market exposure attributes of nearly any other financial or  real asset or commodity that has a generally accepted and accessible data feed and/or price discovery. As such, Veritas also acts as the fuel to run the P2P capital market’s engines.

The Veritas ICO will be capped, guaranteeing the scarcity of Veritas, Negotiations are being made to have Veritas accepted off blockchain by legacy institutions.

The New Age, 21st Century Gold Rush: The Grab for Intellectual Property Rights in Smart Contract and Blockchain Technologies

First things, first – let’s quantify the sum of money that is in question. Veritaseum’s platform deals in value transfer. That is not the same as securities, banking or even Wall Street industry. It is literally the exchange of things that are worth something. It is literally the largest potential market in existence. This is a page taken from our crowdfunding information deck.

Addressible market Putting this into perspective, that.s $16.35 of value for every basis point of market penetration. Five basis points of real penetration across markets will dramatically increase the demand and scarcity of Veritas.

Veritaseum doesn’t have to take over markets, it simply has to ensure reliable usage in a very small subsection of markets.

JP Morgan, Bank of America, Goldman Sachs and IBM are just a sampling of the some of the largest, most powerful and most influential companies that have rushed to file patents in this potentially unprecedented arena of profit. From a financial, technological and value perspective, it is literally the second coming of the Internet.


The smart(er) money appears to have started filing financially focused cryptocurrency-related patent applications in the 1st and 2nd quarter of 2014.

 

Below you will find the Veritas digital road show - a slide presentation that goes through what Veritas is, what Veritaseum does, and why you should get involved. This presentation is interactive and chocked full of content. To get the most out of such a dense offering, be sure to make use of the interactive table of contents on the 2nd slide, and please click through all of the videos, links to download the various documents and take your time to read and understand what Veritas is and is not, and what Veritaseum is and plans to be. 

 

Come back here on the 25th of April for more information and the links necessary to access  our crowdsale and initial coin offering smart contracts, be ready to get started! In the meantime, come and find out why we're so excited about this... transformation of capital markets...

 

 Ve value flow chart small

For more information, download the Veritas deal sheet and the step by step guide to purchasing Veritas can be downloaded here.

The online Veritas presentation deck is rich with descriptions and links to other documentation and instructions on participating should you want to dig in deeper.

Download the Pathogenic Finance report and view the video.

Come back to Veritaseum.com at the open of NY financial markets (9:30 am, EST sharp) on April 25th, 2017 to purchase your Veritas, and own your keys to the P2P Capital Markets.

Deutsche Bank is trading at 1/4 its book value. Book value is the measure that the street uses to value banks. Unfortunately, boo value is meaningless for banks today, who's books are no longer marked to market, distorted by negative interest rates and transformed by Harry Potter style accounting. It appears as if the market is not going for it. We, at Veritaseum, never did! Here's an example of why oen should heavily discount DB's book value number. Mortgages are one of the, if not the, biggest loan buckets on DB's balance sheet. Five percent of those mortgages are underwater (guaranteed losses). Seventeen percent are over 70% loan-to-value ration. Well, you may be saying to yourself "That's not bank run material".

The German housing market is on an absolute tear. One could be tempted to say its a bubble, but the German economy is the strongest in all of Europe, right? It's the engine that powers the EU, right? Well, German home prices have handily outgrown, and continue to do so, German wage growth - by a very wide margin. So, if real wages aren't powering these fantastic price gains, then what is???

Geran rates

IF the ECB fails to perfectly juggle all of those negative interest rate balls simultaneously (unlikely) then DB will have a hell of a Bear Stearns/Lehman-like problem on its hands, as housing prices crash and DB's mortgage portfolio goes from 5% underwater (likely quite understated) to something like 30-40% underwater. There goes bank equity and here come bank bail-ins!

The info below is taken from our DB subscription research (see Derivative Risk Exposure of Major Banks to Deutsche Bank). Those who are truly interest in this should purchase our DB counterparty research to see who we feel is the most profitable potential short in the sector. It can be found here -European Bank Contagion Assessment, Forensic Analysis & Valuation. We can break out the short only research for $500 fi you don't want to subscribe to the entire series.

DB mortgage problem

During the financial crisis of 2008, money market funds who subjectively agreed to hold their NAV (net asset value) unit prices at $1 “broke the buck”. That is, the unit of share of the fund fell below $1 (the $62.5 billion Reserve Fund, to be specific, one of only two funds to “break the buck”), which was a significant problem for the investors who used (and considered) said money market funds as cash in the bank. All of a sudden, everyone’s cash account at the Reserve Fund just dipped in value. Uh Oh! This caused short term credit to literally freeze, worldwide, because others were concerned that their bank-like security and liquidity was no longer that secure nor liquid.

Regulators stepped in to make sure this didn’t happen again by demanding that all money funds who do not invest in sovereign securities (those entities who “should” be able to print their own monies, but we’ll get into that in a later post) allow their NAV to freely float with market prices.

The result? Money flew out of prime money funds into perceived safer vehicles.

Demand for government short term paper has increased (to the tune of hundreds of billion of dollars).

 

... and demand for private commercial paper, ie. banks, have dropped by a similar amount, materially driving costs - materially, as in doubling it!

What does this mean?

No, this is not a punishment. This is actually a good thing, for it forces money to have an appropriately derived price tag attached to it. Risky banks were being funded at the same risk rate as (less risky) sovereign governments. That didn’t make sense. Now the system makes more sense, and banks should be repriced according to their access to, and true cost of, capital. The true cost of capital means that banks can no longer hide behind fake LIBOR quotes to conceal their deteriorating credit metrics. Reference Wikipedia:

The Libor scandal was a series of fraudulent actions connected to the Libor (London Interbank Offered Rate) and also the resulting investigation and reaction. The Libor is an average interest rate calculated through submissions of interest rates by major banks across the world. The scandal arose when it was discovered that banks were falsely inflating or deflating their rates so as to profit from trades, or to give the impression that they were more creditworthy than they were.[3] Libor underpins approximately $350 trillion in derivatives. It is currently administered by NYSE Euronext, which took over running the Libor in January 2014.[4]

Look at what happened to LIBOR consistently after NYSE Euronext took over adminstration. Those spikes that you see previous to that takeover stem from the European sovereign debt crisis. Those numbers had been faked! No telling what the true level of stress really was. Well, this time around we may get to find out. To put this into perspective, the global money market industry is $2.6 trillion in assets. Deutsche Bank’s (a bank that is in trouble) balance sheet is almost $2 trillion dollars. JP Morgan’s balance sheet is $2.4 trillion dollars. Both of these banks have been shrinking their balance sheets.

As excerpted from Bloomberg:

With a seismic overhaul of the $2.6 trillion money-market industry weeks away from kicking in, money managers are bracing for a last-minute exodus of as much as $300 billion from funds in regulators’ cross hairs.

Prime funds, which seek higher yields by buying securities like commercial paper, are at the center of the upheaval. Their assets have already plunged by almost $700 billion since the start of 2015, to $789 billion, Investment Company Institute data show. The outflow has rippled across financial markets, shattering demand for banks’ and other companies’ short-term debt and raising their funding costs.

Interestingly enough, and as is par for the course, we see things differently from the Street, as also excerpted:

Financial firms paying higher rates to attract investors to their IOUs will push three-month Libor to about 0.95 percent by the end of September, according to JPMorgan Chase & Co.

Click here to read more about rising Libor rates.

Although bank funding costs are rising, it isn’t a signal of financial strain as in 2008, said Jerome Schneider, head of short-term portfolio management at Newport Beach, California-based Pacific Investment Management Co., which oversees about $1.5 trillion.

“This is not a credit stress event, it’s a credit repricing due to systemic and structural changes,” he said.

He’s right. It’s not a credit stress event… yet! But, the credit repricing will force a reality and discipline on an industry accustomed to near zero and negative interest rates that it is ill-fitted to handle, and thus in due time, it will likely provide at least a partial impetus for… “a credit stress event”.

NiM (net interest margin - the profit from actual old school banking businesses, ie. lending) is still quite sparse in banks. So, revenue is slim, but expenses to access said capital to conduct business are going up. That's never a good sign. Worse yet, the Fed has signalled it will, yet again, hold off on an interest rate increase - As I have been telling you since December of 2014.

The issue is, the Fed does not truly control the market, it simply manipulates it to the best of its ability. When it's ready, the market will raise rates on its own. Reference where short term rates are trending now, likely as reflection of the Fed not raising rates.

This is particularly true for the European banks...

Our next post will describe how well Deutsche Bank is prepared for such an event. Stay tuned, and if you have not already done so, subscribe to our long/short, macro and educational research (including blockchain tech) - see Corporate Valuation & Equity Research.

We have a brand new DB report out today, reference Derivative Risk Exposure of Major Banks to Deutsche Bank.

thumb Fortune Front CoverA few days ago I was waxing poetic over the abilty of David Z. Morris' ability to grasp rather complex, intangible concepts and loquaciously lay them forth in the written word via the pages of Fortune magazine. After all, what creative destruction advocate wouldn't get all mushy after reading "Reggie Middleton, currently building a client called BTC Swap. Middleton, gravelly voiced, dapper, and businesslike, doesn't fit the stereotype of woolly young bitcoin developers. But he slyly describes himself as "not quite an anarchist," and BTC Swap is a shot directly across the bow of the financial industry"...

Or "Middleton sounds a bit like an 18th-century pirate striking back against the Empire when he declares that "what I'm doing right now is a direct threat to fiat merchant banking." For him, excitement over value fluctuations in the bitcoin currency is missing the point: "It's not a threat as people sit there and ponder whether bitcoin is a bubble or not. But if people go through the protocol and use their imagination, the existing system is threatened."

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ReggieMiddleton @thetweetmaestro @nguyenatang - Happy to have you in my community :)
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Friday, 22 September 2017 23:36

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Veritaseum

1-718-407-4751

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