Author: Iris LI
Blockchain technology has helped to design different token-based economies and create massive value for users. Token is regarded as a crucial element of most blockchain projects. BlockAsia caught up with Mr. Rongbin LI, the Incubation Partner of Genesis Capital, at the 2018 ICE (Innovate. Connect. Economy) Conference in Singapore to find more about what are Genesis Capital concerns about token-based economies and blockchain industry.
BlockAsia Interviews Mr. Rongbin LI, Incubation Partner of Genesis Capital
I have read one famous article written by you named ‘Good Token Versus Bad Token’. As for the bad Token section, you have mentioned that it was really bad to use TOKEN to buy real products and offline service. You said this could be only reached based on mature AI technologies in the future. Could you please explain more details about the point to readers here?
Basically, it is not reasonable to reflect real products and offline service into chains. I have seen some tokens such as coffee tokens, banana tokens and real estate tokens trying to reflect their real products into chains, which means each on-chain token represents each off-chain capital. It does not make sense currently. The main issue is that how to ensure off-chain capitals to reflect on chains and I have never seen one solution till now. Specifically, no prediction system could be considered as a good oracle to measure and solve the main issue by current blockchain projects.
As the partner of Genesis Capital, what’s your investment strategy and could you please share something about the general investment strategy of Genesis Capital? How to select so-called high-quality projects?
Genesis Capital selects blockchain projects based on ‘getBTC’ method.
The capital letters of ‘BTC’ refers to the basic framework of our investment strategy.
B stands for business model. The decentralized blockchain technology should be essential to a high-quality blockchain project. The so-called good blockchain project should focus on solving current or future problems, but not focus on how to win more and more profit. Blockchain technology should be considered as the useful instrument for the reality.
T stands for technology. We do not really care about how much technological outcome does one project have now. The main concern for technology is whether the fundamental logic of technology does make sense.
C stands for community. Popularity or the number of users is not the criteria for us to identify the quality of community. We do care about the whole composition of community members
Then the lower-case letters of ‘get’ suggest the limitations of most blockchain projects, which means that most projects lack of these features now.
‘g’ stands for governance. In fact, most blockchain projects lack of governance.
‘e’ stands for token economy. For a high-quality project that issues tokens, the issuer should play the role of the central bank as in reality. The complete token economy should have related microeconomic and macroeconomic policies and even need to define some economic growth.
‘t’ stands for team. Most blockchain projects refer to entrepreneurship and thus high-quality projects should reflect complete entrepreneurship. Specifically, the team should show the full portfolio as well, not limited to only technological team or business team.
Finally, we will require each project team to provide a proposal to us based on ‘www’ model. The three w involves three questions: ‘why we should invest you’, ‘why you choose Genesis Capital to be your investor’ and ‘why do you use blockchain technology’.
There are many security issues of crypto exchanges these days. Could you please give some advice to us about what to look out for in high-quality crypto exchanges projects based on investors side? What will be your security concerns when investing?
Generally, there are several issues when investing crypto exchanges.
- Tons of crypto exchanges are in the industry now and these exchanges are highly changeable, involving high investment risks
- In fact, the transaction mining method of FCOIN should not be a sustainable approach and not a complete revolutionary method. We are considering investing some crypto exchanges that utilize banker method to final achieve person-machine transaction.
In conclusion, we prefer and expect crypto exchanges with complete revolution methods.
I have heard that you worked in traditional financial market before and you had even suspected some blockchain stuffs. What motives you to enter into the blockchain market? What do you think about its future trend? Because someone is still suspecting and against the industry.
I have been to many African countries before and there was a round of oil price collapse from 2014 to 2015. Before I traveled to Nigeria, Nigeria’s currency was 150 to one USD, suggesting fifty Nigerian Naira changed for one dollar. After one month, it become a hundred and fifty-to one USD. In terms of the stability and the affordability of the legal currency, the fiat money is completely losing value, its central bank endorsement has basically lost its credibility and true meaning of endorsement. From this perspective, the legal currency of some countries is not as good as a decentralised digital currency issued by a central bank. After gradually understanding these, I found that the blockchain technology really has the potential to solve some problems, or at least gives a possibility to solve the problem.
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