Most advice around ICOs tends to center on researching the team or project themselves, but Draper favors a different approach.

The never-ending debate is if Bitcoin is a universal currency. I attend the final session of the Blockchain Economic Forum in San Francisco, where venture capitalist Tim Draper was interviewed by former Obama administration CFTC chairman and current MIT lecturer Gary Gensler.

In a wide-ranging conversation, the pair covered many of the key elements causing so much excitement in the crypto space, and confidence in the future was the running theme.

“It’s like all transformative technology,” said Draper of the crypto revolution and some lingering reticence on the part of legacy institutions. “It’s just a matter of time. The more fear we impose on tokens, the longer it will take – but it is happening. You can hear the panic in the bankers’ voices. They get together and say they’re not letting it happen, put out lawsuits, try and get their government friends involved. It comes down the same: are they going to make something, or are they going to buy something?”

He’s right: the core narrative of the past year in crypto – one that’s got a lot less attention than the extreme volatility in the more prominent cryptos like bitcoin – is the gradual institutional acceptance and exploration of both blockchain and crypto. From the arrival of futures contracts on prominent exchanges to the opening of crypto desks in almost every investment bank, what was once on the fringes has now become at the very centre of the strategies of several prominent institutions.

Draper also offered his thoughts on what he looks for in an ICO project – or, as he called them, “kick-starter for social transformation.”

Most advice around ICOs tends to center on researching the team or project themselves, but Draper favors a different approach.

“When I look at ICOs,” he said, “I’m looking for a network, because the bigger the network the higher it can go up. The second thing I look for, is after the ICO is there a market for this coin?”

This network-centric approach is interesting: network theory has received a lot of attention in recent years, and provides an interesting prism to look at ICOs through. With a bit of research, it should be possible to locate a project within a matrix or ecosystem of other companies and individuals. This could provide a key differentiator for investors examining what can be often similar projects – where does an individual ICO fit in with all the others?

The second part of his advice is more familiar: examining the use case for a coin and determining its market potential accordingly, but what is not in doubt is the size of the pie on offer: recent data from Coin Schedule has shown that in the first six months of 2018, 434 ICOs raised $9,894,100,106.

On top of that, the world’s sixth largest crypto exchange got hacked yesterday. This hacking issue is insane. Bithumb, the South Korean exchange became the victim of hacking last night and over $30 million was stolen. Only a few days ago, Coinrail, another Korean exchange lost more than 40 million in cryptocurrencies. I sat with Joe Oliver, former minister of finance of Canada, who said, “Regulation is lagging innovation, what we need is a balanced approach that assures financial stability and protect investors without stifling innovation.” He also at the Blockchain economic forum on the regulatory panel.

Draper can be a controversial figure at times, such as with his vocal support for disgraced former Theranos CEO Elizabeth Holmes, and he held forth last night on his conviction that blockchain is going to seriously disrupt state service provision. Whether or not his prediction that 80% of what a government does can be done with blockchain remains to be seen, but only a fool would ignore Draper’s predictions of serious disruption to financial services.

Via Forbes