The Signal: Greed Is...

The Market

Greed Is... For lack of a better word, a historical concept attached to elements of cryptocurrency. Many remember celebrities pitching tokens. Some of those were unregulated. Some tokens were outright frauds.

Andre Cronje, the man behind cryptocurrencies such as Fantom who abruptly left the industry last month, is now publicly railing against some of the greed culture apparent in new crypto. Not only that, but he is calling for “regulated crypto” – a way to regulate the entities involved, rather than the crypto themselves – as a way to boost adoption and bring more into the fold and away from what he calls “badlands.” His profile, and following, will only help bring more attention to strong use cases in Blockchain and Defi community.

Why Blockchains Matter

Regulation Station

Kevin O’Leary, of “Shark Tank” and O’Shares notoriety also weighed in recently on the need for a better regulatory system. Before asset managers plunge headlong into crypto asset adoption, they need policy. O’Leary notes 20% of his portfolio is in crypto, but that that investment play is designed to get ahead of what he sees as institutional adoption, which has not yet fully taken off in his view. 

An unpopular silver lining among these concepts of greed and regulation: hacks. Headlines that $625 million was stolen from Axie Infinity users, or that Metamask (a crypto wallet) users need be on high alert for their iClouds getting compromised are scary. But it's always going to be hard to protect against state actors (North Korea in the case of the Axie Infinity hack). What's important is the response.  Coordinated efforts among trusted organizations and crypto community members are making hacks harder to hide. Crypto addresses are public. And now Tornado Cash, an Ethereum ‘mixer’ that can make those addresses harder to track, has now agreed to refuse addresses that were sanctioned by the U.S. Treasury Department. What good is stolen money if you can’t use it? 

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The Tech

Pass the Netflix

We may now know why Netflix last month floated the concept of cracking down on password sharing - even if they didn’t use those words. Netflix’s quarterly results Tuesday showed their first decline in subscribers in a decade. 

This may indicate the addressable market, i.e. how large the opportunity is for them to grow, may not be as large as previously believed. And this also means the only way to truly grow in the face of competition from the likes of Disney+, Apple TV, Paramount+ and others, is to tap their existing base. 

So how much can they tap? Netflix estimates that 100 million households are using others' accounts –  a number nearly half of the total 222 million current paying subscribers. We’re waiting to see how Netflix’s international tests around asking 'sharers' to pay more fared – it’s likely critical to the growth story.

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* Domain Money Advisors, LLC, an investment advisor registered with the U.S. Securities and Exchange Commission and an affiliate of Domain Money, is currently recommending the following assets contained in this edition of Domain Money’s The Signal as part of Managed Strategies: NFLX, AXS, ETH, DIS, AAPL, FTM