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Why do I believe in blockchain? Notice I am not using the words ‘why I think it’s a good investment,’ or ‘why I think it’s going to work out’. On that topic you could find many other pieces that Unbounded Capital has put out, most notably our first book, but also many other articles and essays which you can find here.
We wrote this 2023 year in review during the first week of March 2024. It has been a busy end of last year and start of the new year as we have already finalized four new investments between Q4 2023 and today. In this year in review we will update you on the progress of our portfolio companies; outline some of the highlights, lowlights, and our learnings of 2023; and look forward to what we expect from the remainder of 2024.
In January 2023, developer Casey Rodarmor found a way to store data on the BTC blockchain that circumvents the intended limitation set by the protocol developers. He created a protocol called Ordinals, where digital artifacts (think NFTs) can be inscribed to an individual satoshi. Since then, the BTC network has seen nearly 10 million inscriptions created, causing yet another schism in the BTC community over the following two questions…
CoinDesk recently wrote a piece on Bitcoin SV’s in development digital asset recovery tool, comparing and contrasting it to the “Killswitch” Satoshi may have been describing in 2010. This post is a short response that summarizes and addresses 5 main points.
While 2021 was a year of “soaring asset valuations for both publicly traded crypto assets and private equity,” 2022 was a year of collapse, contagion, and even criminal complaints against companies previously regarded by our peers as “blue chip.” In this 2022 year in review, we will dive into previous trends that are still developing, new trends that emerged, updates on companies in our portfolio from our Fund I, and updates from our recently launched Fund II.
The story of the collapse of SBF, and the acolytes his demise will topple, is still developing. This cryptocurrency consensus we attacked in our book in 2020 remains fundamentally flawed. At Unbounded Capital, we will continue to focus on where we see real value creation.
As the crypto bubble continues to collapse, investors are naturally wondering where value will come from in the next phase of blockchain. Some will argue that this market collapse is just a bump in the road, and that the same playbook will still work in the long run. Others will say that blockchain has no value at all and that there won’t be another blockchain epoch.
I first met Unbounded Capital partners Dave and Zach while we all lived in the Bay area in 2018 while I was running a monthly Bitcoin SV meetup in San Francisco. As someone fully entrenched in Bitcoin technology for almost 3 years now, I constantly evaluate emerging products, services, and businesses I see building on Bitcoin SV.
In this world, the automobile was invented in the early 21st century and the first ever model was a 2009 Ford F-150. The invention of this truck is a bit of a mystery. Similarly, Bitcoin history is rife with flawed assumptions and downstream consequences of “improvements”.
Last week the Commodity Futures Trading Commision (CFTC) filed a complaint against Ooki DAO a so called “decentralized autonomous organization” for unlawfully engaging in activities without proper registration and violating know-your-customer (KYC) diligence on customers. The defendant in action is listed as “Ooki DAO (formerly d/b/a bZx DAO), an unincorporated association” which is described as a class comprised of the DAO’s token holders who voted with their tokens to govern the protocol.