As predicted, banks are changing their tune on crypto. But this JPM project misses the point – introducing a closed network today is like launching AOL after Netscape’s IPO. 2 years later, and bank coins still aren’t the answer https://www.linkedin.com/pulse/case-against-bankcoin-brad-garlinghouse/ …
- With $40 billion in revenue and a $4 billion investment, Canopy Growth is well positioned to succeed in a legal cannabis market
- There is uncertainty around how much more profitable cannabis business will become now that Cannabis is legal for recreation purposes
- Investors of Canopy Growth nervously await the release of ‘post-legalization’ financial results due February 14th.
The cannabis industry looks to be on the precipice of an explosion as new ‘pro-weed’ regulations are making the drug more accessible than ever.
Canada officially made Cannabis legal for recreational use, allowing companies to boost production and finally introducing marijuana into the mainstream free market. However, like any new industry, the value is highly subjective because there isn’t enough past data to accurately predict future demand. In other words, no one can say for sure that legalizing marijuana for recreational use will make it more popular in the long term. We could very well be in the middle of another FOMO induced hype cycle like Crypto mania in 2017.
Canopy Growth Corp established market dominance, but is it sustainable?
Canopy Growth Corp, a major cannabis company with $40 billion in revenue (CAD) recently saw its stock price jump from $43 to $50 (~16%) in a single week. The recent surge came after Piper Jaffray, a well-respected investment bank, raised their target price for the stock by 50% because they believe the company is well positioned to dominate the growing market for legal and medical marijuana.
Piper Jaffray is expecting the global cannabis market to be worth $250- $500 billion a year in the long term and $15-$50 billion in the nearer term.
Canopy has recently achieved three significant milestones that set it apart from its competitors. For one, the company received a legal hemp license in New York, which gives them entry in the US market. Canopy is expecting to invest $150 million in NY operations on the back of this approved license.
Secondly, Canopy has hemp specific Intellectual Property, which it acquired from Colorado-based Ebbu Inc. Lastly, Canopy recently received $4 billion from Constellation Brands, the makers of Corona and Modelo beer.
All of these milestones have been achieved with the expectation that Canopy will dominate the US and global markets on the heels of widespread marijuana legalization.
First post-legalization results
February 14th will be a significant date for Canopy. It is the date when the company will be reporting its financial results for the third quarter of its 2019 fiscal year.
These financial results are significant because they will contain 2.5 months’ worth of earnings captured after recreational cannabis was finally made legal.
Investors will be able to get a sense of how well the cannabis business is performing under as a system where everyone has access to purchase their products legally. Although it’s too early to tell, the future of the Marijuana industry (and of Canopy Growth Corp) may rest on its ability to prove that an entirely legal cannabis industry has not only opened the floodgates for businesses looking to make money, but also for consumers willing to spend it.
Did JP Morgan Miss The Point Of Cryptos, and What Effect Will JPM Coin Have?
It’s only February and already, we’ve had one of the biggest announcements in the crypto industry. JP Morgan announced yesterday that it had successfully trialed the JPM Coin. It will use it for its $6 trillion wholesale payments business as well as securities transactions. In doing so, it became the first bank in the U.S to have its own cryptocurrency.
Unsurprisingly, the industry is already racking its brains pondering the implications of the newest crypto. There are those who believe that despite being centralized, the JPM Coin will inspire mainstream adoption of cryptos. It’s only a matter of time before the other banks turn to digital currencies.
There’s an even bigger group that believes that JP Morgan has missed the whole point of cryptocurrencies. The JPM Coin will be a centralized currency. Thus, the bank will have a stranglehold on its supply, who uses it and how it’s used.
One of the people who believe that the industry should not be celebrating the JPM Coin is Brad Garlinghouse. The eccentric Ripple CEO believes that the bank is taking us back to the old days as we try to move ahead. He tweeted:
However, according to one crypto research expert, Garlinghouse has every reason to be critical of the JPM Coin. With the JPM Coin targeting Ripple’s – and by extension XRP’s – core market, it’s no surprise that Garlinghouse is so critical. This is according to Tom Shaughnessy, the CEO at New York-based crypto research firm, Delphi Digital.
Ripple may have enrolled 100 banks on its platforms, but in JP Morgan, it has a formidable competitor. The bank moves $6 trillion every day on its wholesale payments platforms. Even a fraction of these would be miles ahead of the amount transacted on Ripple’s network.
Speaking to Bloomberg, Shaughnessy stated:
This is a huge slap in the face for Ripple. Ripple’s target market is cross-border payments and remittances and now JPMorgan’s effort is a direct threat.
Shaughnessy isn’t the only one who believes that the JPM Coin is a direct threat to Ripple and XRP. Travis Kling, the founder of Ikigai Asset Management also believes that Ripple Labs should be very worried. The seasoned crypto investor explained:
JPM’s project is much more evolutionary than revolutionary — it is utilizing a private, permissioned blockchain technology called Quorum, which is much closer to a Google Sheet than a Bitcoin. The project is clearly competing directly with Ripple Labs and their centralized cryptocurrency XRP.
Garlinghouse pointed to an article he wrote on his LinkedIn page in 2016. In the article, he explained that a centralized bank coin would go against Satoshi Nakamoto’s vision. Banks are competitive and as such, they’d never settle on one digital currency to use, he reasoned. We’d, therefore, end up with hundreds of bank coins which would add more chaos to the industry.
The result would be an even more fragmented currency landscape than what we have today. If banks of different digital asset groups want to settle trades with one another, they’ll have to make markets between their unique digital assets or trade between their digital assets and a common fiat currency. What a mess!
A Progressive Outlook
And while Garlinghouse is quick to criticize the centralization of crypto, XRP has been constantly criticized for the same exact thing. Ripple Labs, which Garlinghouse leads, has been accused of having a whole lot of influence on XRP.
Away from the JPM Coin vs. Ripple narrative, there are many who view JP Morgan’s move as very positive. While it’s not everything the crypto world would have wanted, at least a banking giant has recognized that the future belongs to digital currencies. It could also be the first step in the infiltration of the tightly knit finance industry by cryptocurrencies.
Unocoin Becomes Second Exchange to Launch Nomination Feature for its Users
It turns out that Crypto-Kanoon’s initiative to raise the demand for nomination feature in crypto exchanges is paying some handsome dividends to the entire cryptocurrency community. Within a few days of initiative’s launch a huge number of cryptocurrency enthusiasts voiced their support for the feature, and one Indian exchange (namely PocketBits) also became globally the first exchange to launch this feature. Now it looks like other exchanges are also coming ahead to follow the suit, as Unocoin has also launched the feature.
That’s right. Unocoin has become the second cryptocurrency exchange to launch this feature of nomination. The feature was announced yesterday evening, and users can register their nominees by using the website of Unocoin exchange. Detailed instructions regarding where can one find the feature were not provided by the company, so you’ll have to find the feature yourself.You asked it, We built it!
Now you can add nominee details for your Unocoin account. @cryptokanoon #Unocoin#Nominee #crypto #CryptoNews #CryptoTwitter pic.twitter.com/LMUh5HV6X5
— Unocoin (@Unocoin) February 14, 2019
Other exchanges, however, are still remaining to launch the feature. BitBns, WazirX, and Coindelta have still not launched nomination feature on their respective platforms. Cryptocurrency exchanges are the only businesses in the finance industry which don’t provide the ability to nominate someone, and therefore it’s imperative to make this change immediately. Now it will be interesting to see how long the other exchanges in India take to launch this feature when two of their competitors have launched it already.
Nvidia Says Crypto Drop-Off Helped Drive ‘Disappointing’ Fourth Quarter
U.S.-based graphics card maker Nvidia has said the downturn in sales to cryptocurrency miners drove a “disappointing” fourth quarter.
In its latest financial report, published Thursday, the firm said for Q4, ending Jan. 27, it made revenue of $2.21 billion, down 24 percent from $2.91 billion in the same quarter last year, and down 31 percent from $3.18 billion in the previous quarter.
The firm said it is still feeling the effects of a drop-off in the crypto mining market, with an excess of inventory it had struggled to sell.
Nvidia founder and CEO Jensen Huang commented:
“This was a turbulent close to what had been a great year. The combination of post-crypto excess channel inventory and recent deteriorating end-market conditions drove a disappointing quarter.”
In an earnings call on Feb. 10, Colette Kress, the firm’s executive vice president and CFO, added that the issue had caused the firm to reduce shipments in order to allow excess inventory to be sold. She added that inventory is expected to normalize in Q1 in line with its forecast.
The report also provides revenue numbers for the last full year.
Inventory issues aside, Nvidia said it made record revenue for the year of $11.72 billion, up 21 percent from the year prior. It also saw record yearly revenue from its gaming, datacenter, professional visualization and automotive segments.
“Despite this setback, NVIDIA’s fundamental position and the markets we serve are strong,” Huang said. “The accelerated computing platform we pioneered is central to some of world’s most important and fastest growing industries – from artificial intelligence to autonomous vehicles to robotics. We fully expect to return to sustained growth.”