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“The Social Internet” Conference Call Series Bitcoin – The New Digital Gold?

June 2013

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Viral(people actually will talk about it)

Novel(opportunity to reshape regulatory structures)

Global(reaches many types of underserved users)

Bitcoin is unique in financial services

Three general ways to play it….

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1. Invest in BTC

Bitcoin:• Is useful (remittances, micro-transactions, time-sensitive

payments, etc)• Is scarce, so it has a price ($100+ today)• Clearly can go to zero, but the payoff is asymmetric• Of course, you need to assign your own probability of

success!

1/5 of Current Growth over 5 yrs = $3,000+ BTC

5% of $20 trillion Informal Economy = $7,000+ BTC

5% of $7.5 trillion Gold Market= $15,000+ BTC

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2. Invest in Bitcoin Infrastructure

The first wave of Bitcoin companies:• Are aimed at improving the basic user experience• Similar to the ISPs/dial-up services of the early Internet• Some will be valuable, but many will not• Mining opportunities = lucrative (for some), short-lived

Wallets Exchange/Trading Platforms

Merchant and Payment Services

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3. Invest in the innovation Bitcoin will spawn

Bitcoin is like TCP/IP, the Internet. What will be Google?• Recasting the financial services we know• Today: vertical, geographically-specialized• Tomorrow: horizontal, functionally-specialized

• Creation of financial services we haven’t imagined yet• ex. Reputation-based peer-to-peer lending• ex. Smart asset ownership tied directly to identity• ex. Use of the blockchain for other purposes