Eerder schreef ik al over de kwartaal- en jaar-review die ik tegenkwam in het boek Grip van Rick Pastoor.
Hierbij dan ook een checklist om je week review te doen in de vorm van een Google doc – maak een kopie voor jezelf en ga aan de slag!
Eerder schreef ik al over de kwartaal- en jaar-review die ik tegenkwam in het boek Grip van Rick Pastoor.
Hierbij dan ook een checklist om je week review te doen in de vorm van een Google doc – maak een kopie voor jezelf en ga aan de slag!
Na het lezen van het boek ‘Grip’ van Jeroen Pastoor – aanrader! – besloot ik om op zoek te gaan naar de jaar- en kwartaal-review in digitale vorm. Om deze oefeningen regelmatig uit te voeren leek het me een goed idee om ze als template in een google doc te hebben. Ten tijde van eindejaar of -kwartaal is het dan eenvoudig kopie maken en invullen!
Online vond ik ze echter niet terug, dus heb ik ze hieronder uitgeschreven in een Google doc. Open dit doc, maak een kopie voor jezelf, en ga aan de slag!
In this blog I will go into a recurring conversation I have about the (ir)relevancy of online video ads. I believe this irrelevancy is the result of a lingering mindset from traditional TV advertisers who now buy online video ads; their mantra is that the advertiser decides when a user sees an ad, instead of the user.
The stats on the perceived irrelevancy do not lie – in the article “Mary Meeker is right — most online ads suck” the author writes that 81 percent of Millennials, here defined as people now aged 18-34 years old, mute video ads they find irrelevant. It is now more easy than ever to tune out, ignore or literally ‘skipping’ a video ad. The specific targeting capabilities of online media also bring increased expectations by the target audience with respect to relevancy; if the message does not speak to them, they have all the tools they need to ignore, skip and even block your message. For decades, audiences are used to tuning out of the TV commercials, however the shorter length of online videos led to new ad formats for video; those that offer users control over the ad, such as a skip button.
The old school of broadcast TV advertisers typically uses audience descriptions that go no further than ‘M/F 18-34’ – males and females aged 18 to 34. The ‘programming’ schedule of old school TV included the same ads for everyone. One reason people love online video is its on-demand nature; there is a vast video landscape, and each of us can discover, pick and watch what we like the best. This on-demand nature of online video also raises the bar with respect to the relevancy level of the video ads shown before and around the videos that we choose to watch. Now that we can each program our own schedule, why would we all need to see the same ads at the same time? The schedule shifted from being advertiser-driven with broadcast TV, to being user-driven with online video. Users decide what they watch and that holds for ads too.
This shift means that now more than ever, a video campaign should start with researching the online behaviors of the audience whom you will show the video to. This research should lead to a more granular knowledge than the MF18-34 description known from broadcast TV. Although gender targeting makes sense for many products, an age range from 18 to 34 is simply too broad; someone who is 18 years old might not be interested in the same video as a thirty-something. A helpful exercise can be to imagine what your target audience is interested in, and what they do on the video platforms – again, their behavior is leading. For example:
Bottom-line is that you should look for the common behaviors of your ideal audience, rather than characteristics only. For example, you can narrow your targeting by targeting gender female, age 18-34, who have an interest in healthy food. On the other hand, your campaign may not need gender and age targeting at all; why would the guitar learning app keep its app from showing to everybody interested in learning to play the guitar – narrowing down with gender and age would just keep you from reaching a valuable target audience. The behavior of the audience should be leading when picking your campaign’s targeting.
The easiest way to think about this is in terms of ‘ready reach’. Ready reach means that your video will be shown to someone who qualifies his- or herself for getting that impression at that specific moment in time. This is not new, as this concept has made the case for search engine marketing. However, for video ready-reach is a departure from the burst-reach flight campaign mindset known from broadcast TV.
Burst-reach means showing the ad to as many people as humanly possible in a rather wide audience, and the campaign is on for a few weeks a year. You could say that by being in the gender and age bracket someone also qualifies herself to see the video, which is technically true, however that is not the point. The point is that someone in the MF18-34 bracket will not experience improved qualification, because the video ad is not shown at the right moment – relevancy is not improved.
Who is best positioned to deliver relevant video ads? What I see happening is that performance marketeers, often coming from a search engine marketing background, have the mindset to do this. They are used to considering audience behaviors before creating a campaign. They are trained to harvest demand, to be there when a user qualifies herself to see an ad when she types in a search term related to that ad.
This online video buyer thinks in terms of a ready-reach video campaign which is always-on; why would the guitar learning app mentioned in the example above, turn off a ready-reach campaign that is working – if it is realizing downloads of the app at the target cost-per-install? Pausing that campaign would hurt the business. This campaign should be on all the time, reaching people when they qualify themselves to be reached. In that moment the message will be highly relevant too – you just killed two birds with one stone.
To improve the relevance of online video ads we should approach and plan these campaigns akin to a search engine marketeer; someone used to carving out his audience with narrow sets of keywords, harvesting demand by showing an ad only when a user qualifies herself for that ad, and measuring success using analytics.
Do you see yourself applying the search mindset to online video ads? Share it in the comments.
Citizen initiative ‘Ons Geld’ (Our Money) succeeds in getting this key topic on the political agenda. See the money system ‘round table’ discussion in the Dutch House of Representatives in the video here:
While reading the MoneyLab Reader, I stumbled upon an article by Beat Weber, going into the contexts where Bitcoin or other complementary currencies are actually attractive in the presence of traditional (fiat)currencies:
Complementary currencies can work if they are able to:
Absent such attractions, keeping a CC in use requires measures to decouple community
members from the rest of the economy, which goes beyond the mere introduction
of a currency. But even in that case, alternative economic circuits revolving around
CCs will need official currency to pay for taxes and at least some imported commodities
from the outside world. This requirement entails difficult choices involving the
means of acquiring outside currency and managing the implications this has for the
loyalty of CC community members and the management of exchange rates with the
official currency. Because decentral entities issuing complementary currencies usually
lack powerful instruments like capital controls, legal tender laws or taxing authority,
they must either attract voluntary users with economic features that prevail in competition with official currency, or they must induce people to substitute individual economic motives by collective values enforced by peer pressure or non-economic benefits.
Of course, community members can choose to adopt complementary currencies despite
their failure to prevail in competition against competing currency networks according
to purely economic criteria. Whether such non-economic motives can prevail
over economic advantages of joining official currency networks is an empirical question
that cannot be settled once and for all. But it has to be kept in mind that enforcement
mechanisms to foster community participation can gain a repressive character
beyond a certain limit. And while social and community building effects may be
considered successful features of complementary currency projects which go beyond
economic aspects, possible disputes among network members over valuation standards,
distribution of benefits and governance issues are also part of the reality of CCs
which have to be included in any assessment.
Some CC projects are based on the hope that a different currency can stop the growth
of inequality, thought as being triggered by the accumulation of money and the alleged
tendency of money to grow through the compound interest mechanism. But such an
approach rests on the conflation of money and wealth. Wealthy people do not hoard
cash or bank accounts to a large extent. The primary form of wealth in capitalism is
business ownership and income derived from owning or managing firms, as well as
housing property and various financial assets. None of these are touched upon by
Inequality is not the result of monetary distortions of the market but
of its normal functioning, assisted by a very benign tax treatment of wealth and its private transfer among generations. This wealth is the result of profit-oriented production based on private property and free labor, organized by competition on markets. Money symbolizes, measures, stores, and transfers wealth. Manupulating or reforming money does not yield an economy based on different principles. The expectation that through reformed money, the market would turn into a neutral forum of exchange among independent, small and equal individual producers is subject to disappointments.
Source The Economic Viability of Complementary Currencies:Bound to Fail? by Beat Weber, in MoneyLab Reader
More from Beat Weber:
…and how to avoid it:
I pre-ordered my Leap Motion controller some months ago, and I got the device by mail two weeks ago, taking my #firstLeap. This is a short story of first impressions so far.
The Leap Motion controller is a Natural User Interface (NUI): it is touch without a touch screen – the controller senses motion (gestures) by means of two cameras and three infrared LEDs.
What makes the Leap different from other gesture controllers, like Microsoft’s Kinect, is amongst others its better precision; it can track 10 fingers separately. Furthermore, the Leap device sits on a desk, facing upwards, and scans the space above it. Kinect sits below or on top of the screen, and faces forward. Where the Kinect is a full-body scanner, Leap scans hands best.
This difference makes that the user context of Leap controller is different from Kinect; where a Kinect user can be a few meters away from both the screen and the Kinect controller, with Leap the user has to be behind a desking, probably sitting, close to the screen and the computer it is connected to. This makes Leap less practical for interacting with a tv, as you will need a very long cable for the Leap, or have the computer close to you as well. The Leap is often portrayed sitting right next to your mouse and keyboard. This is an honest use image – you should not expect this device to replace your mouse and keyboard.
Although the Leap feels quite precise – it ‘works’ well when you first try it with an app like Cut The Rope – it is not precise enough to interact well with the current interfaces of WIndows/Mac; icons and buttons are made for mouse clicks and are simply too small to reliably point-and-hit using the Leap. Its interesting that it apparently is very hard for a human (me, at least…) to move a finger forward in space while keeping it at the same height – when you do this, you will naturally also push downwards, which means that you miss the button, and get a bit frustrated. 🙂 This issue was also mentioned in Engadget’s review of Leap:
Early reviewers noted Leap as an “admirable distraction but not useful for truly productive usage” and to some it feels as though they “experienced a gimmick”. Both statements currently make some sense, the Leap works best with the games available in the AirSpace store. However, when you are not expecting this device to replace your mouse and keyboard, but to complement them, expectations should be more in line with current practice. For 80 dollars, the Leap is a great ‘gimmick’ that will have some very ‘productive’ uses beyond games, as specific software/interfaces are developed for it and existing ones add support for it (like Google Earth has done). Until then, I will enjoy Leap with games. Now, get this thing to work with the Raspberry Pi, please! 🙂
Some suggestions for improvement
The US Securities and Exchange Commission (SEC) has received a registration for a Bitcoin Fund. In case you wonder what the risks are of investing in Bitcoin, here is the quite extensive list as noted in the fund prospectus:
Risk Factors Related to the Bitcoin Network and Bitcoins
The loss or destruction of a private key required to access a Bitcoin may be irreversible. The Trust’s loss of access to its private keys or its experience of a data loss relating to the Trust’s Bitcoins could adversely affect an investment in the Shares.
Bitcoins are controllable only by the possessor of both the unique public and private keys relating to the local or online digital wallet in which the Bitcoins are held, which wallet’s public key or address is reflected in the Bitcoin Network’s public Blockchain. The Trust publishes the public key relating to digital wallets in use by the Trust when it verifies the receipt of Bitcoin transfers and disseminates such information into the Bitcoin Network, but is required to safeguard the private keys relating to such digital wallets using the Security System. To the extent such private keys are lost, destroyed or otherwise compromised, the Trust will be unable to access the related Bitcoins and such private keys will not be capable of being restored by the Bitcoin Network. Any loss of private keys relating to digital wallets used to store the Trust’s Bitcoins could adversely affect an investment in the Shares.
The further development and acceptance of the Bitcoin Network and other Digital Math-Based Asset systems, which represent a new and rapidly changing industry, are subject to a variety of factors that are difficult to evaluate. The slowing or stopping of the development or acceptance of the Bitcoin Network may adversely affect an investment in the Shares.
Digital Math-Based Assets such as Bitcoins may be used, among other things, to buy and sell goods and services are a new and rapidly evolving industry of which the Bitcoin Network is a prominent, but not unique, part. The growth of the Digital Math-Based Assets industry in general, and the Bitcoin Network in particular, is subject to a high degree of uncertainty. The factors affecting the further development of the Digital Math-Based Assets industry, as well as the Bitcoin Network, include:
• Continued worldwide growth in the adoption and use of Bitcoins and other Digital Math-Based Assets;
• Government and quasi-government regulation of Bitcoins and other Digital Math-Based Assets and their use , or restrictions on or regulation of access to and operation of the Bitcoin Network or similar Digital Math-Based Asset systems;
• Changes in consumer demographics and public tastes and preferences;
• The availability and popularity of other forms or methods of buying and selling goods and services, including new means of using fiat currencies; and
• General economic conditions and the regulatory environment relating to Digital Math-Based Assets.
The Trust is not actively managed and will not have any strategy relating to the development of the Bitcoin Network. Furthermore, the Sponsor cannot be certain as to the impact of the creation of the Trust and the expansion of its Bitcoin holdings on the Digital Math-Based Assets industry and the Bitcoin Network. A decline in the popularity or acceptance of the Bitcoin Network would harm the price of the Shares.
Currently, there is relatively small use of Bitcoins in the retail and commercial marketplace in comparison to relatively large use by speculators, thus contributing to price volatility that could adversely affect an investment in the Shares.
As relatively new products and technologies, Bitcoins and the Bitcoin Network have not been widely adopted as a means of payment for goods and services by major retail and commercial outlets. Conversely, a significant portion of Bitcoin demand is generated by speculators and investors seeking to profit from the short—or long-term holding of Bitcoins. The relative lack of acceptance of Bitcoins in the retail and commercial marketplace limits the ability of end-users to pay for goods and services with Bitcoins. A lack of expansion by Bitcoins into retail and commercial markets, or a contraction of such use, may result in increased volatility or a reduction in the Blended Bitcoin Price, either of which could adversely impact an investment in the Shares.
The administrators of the Bitcoin Network’s source code could propose amendments to the Bitcoin Network’s protocols and software that, if accepted and authorized by the Bitcoin Network’s community, could adversely affect an investment in the Shares.
The Bitcoin Network is based on a cryptographic, algorithmic protocol that governs the end-user-to-end-user interactions between computers connected to the Bitcoin Network. The code that sets forth the protocol is managed by a development team that was appointed by the Bitcoin Network’s purported creator, Satoshi Nakamoto. The development team can propose amendments to the Bitcoin Network’s source code through one or more software upgrades that alter the protocols and software that govern the Bitcoin Network and the properties of Bitcoins, including the irreversibility of transactions and limitations on the mining of new Bitcoins. To the extent that a significant majority of the users and miners on the Bitcoin Network install such software upgrade(s), the Bitcoin Network would be subject to new protocols and software that may adversely affect an investment in the Shares. If less than a significant majority of the users and miners on the Bitcoin Network install such software upgrade(s), the Bitcoin Network could “fork.” See “Risk Factors—The acceptance of Bitcoin Network software patches or upgrades by a significant, but not overwhelming, percentage of the users and miners in the Bitcoin Network could result in a ‘fork’ in the Blockchain….”
If a malicious actor or botnet obtains control in excess of 50 percent of the processing power active on the Bitcoin Network, such actor or botnet could manipulate the source code of the Bitcoin Network or the Blockchain in a manner that adversely affects an investment in the Shares or the ability of the Trust to operate.
To the extent that a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains a majority of the processing power on the Bitcoin Network, it could alter the source code and Blockchain on which the Bitcoin Network and all Bitcoin transactions rely. To the extent that such malicious actor or botnet does not yield its majority control of the processing power on the Bitcoin Network, reversing any changes made to the source code or Blockchain may not be possible. Such changes could adversely affect an investment in the Shares or the ability of the Trust to operate.
As the number of Bitcoins awarded for solving a block in the Blockchain decreases, the incentive for miners to continue to contribute processing power to the Bitcoin Network will transition from a set reward to transaction fees. The requirement from miners of higher transaction fees in exchange for recording transactions in the Blockchain may decrease demand for Bitcoins and prevent the expansion of the Bitcoin Network to retail merchants and commercial businesses, resulting in a reduction in the Blended Bitcoin Price.
If transaction fees paid for the recording of transactions in the Blockchain become too high, the marketplace may be reluctant to accept Bitcoins as a means of payment and existing users may be motivated to switch from Bitcoins to another Digital Math-Based Asset or back to fiat currency. Decreased use and demand for Bitcoins may adversely affect their value and result in a reduction in the Blended Bitcoin Price.
If the award of Bitcoins for solving blocks and transaction fees for recording transactions are not sufficiently high to incentivize miners, miners may cease expending processing power to solve blocks and confirmations of transactions on the Blockchain could be slowed. A reduction in the processing power expended by miners on the Bitcoin Network could increase the likelihood of a malicious actor or botnet obtaining control in excess of 50 percent of the processing power active on the Bitcoin Network or the Blockchain, permitting such actor or botnet to manipulate the source code of the Bitcoin Network in a manner that adversely affects an investment in the Shares or the ability of the Trust to operate.
If transaction fees are not sufficiently high, miners may not have an adequate incentive to continue mining and may cease their mining operations. Miners ceasing operations would reduce the collective processing power on the Bitcoin Network, which would adversely affect the confirmation process for transactions and make the Bitcoin Network more vulnerable to a malicious actor or botnet obtaining control in excess of 50 percent of the processing power on the Bitcoin Network. Any reduction in confidence in the confirmation process or processing power of the Bitcoin Network may adversely impact an investment in the Shares.
The acceptance of Bitcoin Network software patches or upgrades by a significant, but not overwhelming, percentage of the users and miners in the Bitcoin Network could result in a “fork” in the Blockchain, resulting in the operation of two separate networks until such time as the forked Blockchains are merged. The temporary or permanent existence of forked Blockchains could adversely impact an investment in the Shares.
Bitcoin is an open source project and, although there is an influential group of leaders in the Bitcoin Network community including developers, there is no official developer or group of developers that formally controls the Bitcoin Network. Any individual can download the Bitcoin Network software and make any desired modifications, which are proposed to users and miners on the Bitcoin Network through software downloads and upgrades. However, miners and users must consent to those software modifications by downloading the altered software or upgrade implementing the changes; otherwise, the changes do not become a part of the Bitcoin Network. Since the Bitcoin Network’s inception, changes to the Bitcoin Network have been accepted by the vast majority of users and miners, ensuring that the Bitcoin Network remains a coherent economic system. However, a developer or group of developers could potentially propose a modification to the Bitcoin Network that is not accepted by a vast majority of miners and users, but that is nonetheless accepted by a substantial population of participants in the Bitcoin Network. In such a case, a fork in the Blockchain could develop and two separate Bitcoin Networks could result, one running the pre-modification software program and the other running the modified version (i.e., a second “Bitcoin” network). Such a fork in the Blockchain typically would be addressed by community-led efforts to merge the forked Blockchains, and several prior forks have been so merged. This kind of split in the Bitcoin Network could materially and adversely affect the Blended Bitcoin Price (and thus the value of the Shares) and, in the worst case scenario, harm the sustainability of the Bitcoin economy.
Intellectual property rights claims may adversely affect the operation of the Bitcoin Network.
Third parties may assert intellectual property claims relating to the operation of Digital Math-Based Assets and their source code relating to the holding and transfer of such assets. Regardless of the merit of any intellectual property or other legal action, any threatened action that reduces confidence in the Bitcoin Network’s long-term viability or the ability of end-users to hold and transfer Bitcoins may adversely
affect an investment in the Shares. Additionally, a meritorious intellectual property claim could prevent the Trust and other end-users from accessing the Bitcoin Network or holding or transferring their Bitcoins, which could force the Trustee to terminate the Trust and liquidate the Trust’s Bitcoins (if such liquidation of the Trust’s Bitcoins is possible). As a result, an intellectual property claim against the Trust could adversely affect an investment in the Shares.
Risk Factors Related to the Bitcoin Exchange Market and the Bitcoin Blended Price
The value of the Shares relates directly to the value of the Bitcoins held by the Trust and fluctuations in the price of Bitcoins could adversely affect an investment in the Shares.
The Shares are designed to mirror as closely as possible the performance of the Blended Bitcoin Price, and the value of the Shares relates directly to the value of the Bitcoins held by the Trust, less the Trust’s liabilities (including estimated accrued but unpaid fees and expenses). The price of Bitcoins has fluctuated widely over the past three years. Several factors may affect the Blended Bitcoin Price, including, but not limited to:
• Global Bitcoin supply;
• Global Bitcoin demand, which is influenced by the growth of retail merchants’ and commercial businesses’ acceptance of Bitcoins as payment for goods and services, the security of online Bitcoin Exchanges and digital wallets that hold Bitcoins, the perception that the use and holding of Bitcoins is safe and secure, and the lack of regulatory restrictions on their use;
• Investors’ expectations with respect to the rate of inflation;
• Interest rates;
• Currency exchange rates, including the rates at which Bitcoins may be exchanged for fiat currencies;
• Investment and trading activities of large investors, including private and registered funds, that may directly or indirectly invest in Bitcoins;
• Monetary policies of governments, trade restrictions, currency devaluations and revaluations;
• Regulatory measures, if any, that restrict the use of Bitcoins as a form of payment;
• Global or regional political, economic or financial events and situations; and
• Expectations among Bitcoin economy participants that the value of Bitcoins will soon change.
In addition, investors should be aware that there is no assurance that Bitcoins will maintain their long-term value in terms of purchasing power in the future or that the acceptance of Bitcoin payments by mainstream retail merchants and commercial businesses will continue to grow. In the event that the price of Bitcoins declines, the Sponsor expects the value of an investment in the Shares to decline proportionately.
The value of Bitcoins as represented by the Blended Bitcoin Price may be subject to momentum pricing whereby the current Blended Bitcoin Price may account for speculation regarding future appreciation in value. Momentum pricing of Bitcoins may subject the Blended Bitcoin Price to greater volatility and adversely affect an investment in the Shares.
Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for anticipated future appreciation in value. The Blended Bitcoin Price is determined using data from various Bitcoin Exchanges that are selected by the Sponsor. The Sponsor believes that momentum pricing of Bitcoins has resulted, and may continue to result, in speculation regarding future appreciation in the value of Bitcoins, inflating and making more volatile the Blended Bitcoin Price. As a result, Bitcoins may be more likely to fluctuate in value due to changing investor confidence in future appreciation in the Blended Bitcoin Price, which could adversely affect an investment in the Shares.
The Blended Bitcoin Price is based on the daily average of the high and low trading prices on various Bitcoin Exchanges in the Bitcoin Exchange Market chosen by the Sponsor. Pricing on any Bitcoin Exchange on the Bitcoin Exchange Market can be volatile and can adversely affect an investment in the Shares.
The Blended Bitcoin Price has a limited history and is based on a weighted average daily price of Bitcoins, using the average of the high and low trading prices on various Bitcoin Exchanges chosen by the Sponsor. The Blended Bitcoin Price will be calculated as of 3:00 p.m. New York time on each Evaluation Day using data collected from the selected Bitcoin Exchanges for the prior [ ] hours.
The price of Bitcoins on public Bitcoin Exchanges has a limited, three-year history. During such history, Bitcoin prices on the Bitcoin Exchange Market as a whole, and on Bitcoin Exchanges individually, have been volatile and subject to influence by many factors including the levels of liquidity on Bitcoin Exchanges. Even the largest Bitcoin Exchanges have been subject to operational interruption (e.g., the temporary shutdown of Mt. Gox due to distributed denial of service attacks (“DDoS Attacks”) by hackers and/or malware), limiting the liquidity of Bitcoins on the Bitcoin Exchange Market and resulting in volatile prices and a reduction in confidence in the Bitcoin Network and the Bitcoin Exchange Market.
The Blended Bitcoin Price is designed to have limited exposure to Bitcoin Exchange interruption by [ ] using data from various Bitcoin Exchanges selected by the Sponsor. The methodology for calculating the Blended Bitcoin Price calls for the periodic updating of the constituent Bitcoin Exchanges used for the Blended Bitcoin Price and for the substitution of a constituent Bitcoin Exchange to the extent that one of the [ ] constituent Bitcoin Exchanges does not report transactions for 24 consecutive hours. Despite efforts to ensure accurate, weighted pricing, the Blended Bitcoin Price, and the price of Bitcoins generally, remains subject to volatility experienced by the Bitcoin Exchanges. Such volatility can adversely affect an investment in the Shares.
The Bitcoin Exchanges on which Bitcoins trade are relatively new and largely unregulated and may therefore be more exposed to fraud and failure than established, regulated exchanges for other products. To the extent that the Bitcoin Exchanges representing a substantial portion of the volume in Bitcoin trading are involved in fraud or experience security failures or other operational issues, such Bitcoin Exchanges’ failures may result in a reduction in the Blended Bitcoin Price and can adversely affect an investment in the Shares.
The Bitcoin Exchanges on which the Bitcoins trade are new and largely unregulated. The Blended Bitcoin Price on which the NAV of the Shares is based utilizes data from Bitcoin Exchanges selected by the Sponsor to determine the weighted average price for Bitcoins. For a further discussion of the Bitcoin Exchange Market and the selection of Bitcoin Exchanges for inclusion in the Blended Bitcoin Price, see “Overview of the Bitcoin Industry and Market—Bitcoin Value” and “—Uses of Bitcoins.”
Over the past three years, many Bitcoin Exchanges have been closed due to fraud, failure or security breaches. In many of these instances, the customers of such Bitcoin Exchanges were not compensated or made whole for the partial or complete losses of their account balances in such Bitcoin Exchanges. While smaller Bitcoin Exchanges are less likely to have the infrastructure and capitalization that make larger Bitcoin Exchanges more stable, larger Bitcoin Exchanges are more likely to be appealing targets for hackers and “malware” (i.e., software used or programmed by attackers to disrupt computer operation, gather sensitive information or gain access to private computer systems).
A lack of stability in the Bitcoin Exchange Market and the closure or temporary shutdown of Bitcoin Exchanges due to fraud, business failure, or hackers or malware may reduce confidence in the Bitcoin Network and result in greater volatility in the Blended Bitcoin Price. Furthermore, the closure or temporary shutdown of a constituent Bitcoin Exchange used in calculating the Blended Bitcoin Price may result in a loss of confidence in the Trust’s ability to determine NAV on a daily basis. These potential consequences of a Bitcoin Exchange’s failure could adversely affect an investment in the Shares.
Since there is no limit on the number of Bitcoins that the Trust may acquire, the Trust itself, as it grows, may have an impact on the supply and demand of Bitcoins that ultimately may affect the price of the Shares in a manner unrelated to other factors affecting the global market for Bitcoins.
The Trust Agreement places no limit on the number of Bitcoins the Trust may hold. Moreover, the Trust may issue an unlimited number of Shares, subject to registration requirements, and therefore acquire an unlimited number of Bitcoins. The global market for Bitcoins is characterized by supply and demand constraints that generally are not present in the markets for commodities or other assets such as gold and silver. The Bitcoin Network’s mathematical protocols under which Bitcoins are created or “mined” permit the creation of a limited, predetermined number of Bitcoins not to exceed 21 million. Furthermore, the rate of creation or issuance of Bitcoins cannot be increased ahead of the protocol’s schedule. As of [ ], 2013, [11, , ] Bitcoins had been created.
If the number of Bitcoins acquired by the Trust is large enough relative to global Bitcoin supply and demand, further in-kind creations and redemptions of Shares could have an impact on the supply and demand of Bitcoins in a manner unrelated to other factors affecting the global market for Bitcoins. Such an impact could affect the Blended Bitcoin Price, which would directly affect the price at which Shares are traded on the [EXCHANGE] or the price of future Baskets created or redeemed by the Trust.
As of [ ], 2013, the Trust held approximately [ ] Bitcoins that it acquired in the sale of the Initial Baskets on [ ], 2013, representing approximately 0.[ ] percent of the [ ], 2013 world Bitcoin supply. The Trust and the Sponsor cannot provide any assurance that increased Bitcoin holdings by the Trust in the future will have no long-term impact on the Blended Bitcoin Price, thereby affecting Share trading prices.
The Shares may trade at a discount or premium in the trading price relative to the NAV per Share as a result of non-concurrent trading hours between the [EXCHANGE] and the Bitcoin Exchange Market.
The value of a Share may be influenced by non-concurrent trading hours between the [EXCHANGE] and various Bitcoin Exchanges, including those that represent components of the Blended Bitcoin Price. While the [EXCHANGE] is open for trading in the Shares for a limited period each day, the Bitcoin Exchange Market is a 24-hour marketplace; however, trading volume and liquidity on the Bitcoin Exchange Market is not consistent throughout the day and Bitcoin Exchanges, including the larger-volume markets, have been known to shut down temporarily or permanently due to security concerns, directed denial of service attacks and DDoS Attacks and other reasons. As a result, during periods when the [EXCHANGE] is open but large Bitcoin Exchanges (or a substantial number of smaller Bitcoin Exchanges) are either lightly traded or are closed, trading spreads and the resulting premium or discount on the Shares may widen and, therefore, increase the difference between the price of the Shares and the NAV per Share. Premiums or discounts may have an adverse effect on an investment in the Shares if a Shareholder sells or acquires its Shares during a period of discount or premium, respectively.
A possible “short squeeze” due to a sudden increase in demand for the Shares that largely exceeds supply may lead to price volatility in the Shares.
Investors may purchase Shares to hedge existing Bitcoin or other Digital Math-Based Assets, commodity or currency exposure or to speculate on the price of Bitcoins. Speculation on the price of Bitcoins may involve long and short exposures. To the extent that aggregate short exposure exceeds the number of Shares available for purchase (for example, in the event that large redemption requests by Authorized Participants dramatically affect Share liquidity), investors with short exposure may have to pay a premium to repurchase Shares for delivery to Share lenders. Those repurchases may, in turn, dramatically increase the price of the Shares until additional Shares are created through the creation process. This is often referred to as a “short squeeze.” A short squeeze could lead to volatile price movements in the Shares that are not directly correlated to the price of Bitcoins.
Purchasing activity in the Bitcoin Exchange Market associated with Basket creations or selling activity following Basket redemptions may affect the Blended Bitcoin Price and Share trading prices. These price changes may adversely affect an investment in the Shares.
Purchasing activity associated with acquiring Bitcoins required for deposit with the Trust in connection with the creation of Baskets may increase the market price of Bitcoins on the Bitcoin Exchange Market, which will result in higher prices for the Shares. Increases in the market price of Bitcoins may also occur as a result of the purchasing activity of other market participants. Other market participants may attempt to benefit from an increase in the market price of Bitcoins that may result from increased purchasing activity of Bitcoins connected with the issuance of Baskets. Consequently, the market price of Bitcoins may decline immediately after Baskets are created. If the Blended Bitcoin Price declines, the trading price of the Shares will also decline.
Selling activity associated with sales of Bitcoins withdrawn from the Trust in connection with the redemption of Baskets may decrease the market price of Bitcoins on the Bitcoin Exchange Market, which will result in lower prices for the Shares. Decreases in the market price of Bitcoins may also occur as a result of the selling activity of other market participants. If the Blended Bitcoin Price declines, the trading price of the Shares will also decline.
An investment in the Shares may be adversely affected by competition from other methods of investing in Bitcoins.
The Trust will compete with direct investments in Bitcoins and other potential financial vehicles, including securities backed by or linked to Bitcoins and DMBA ETPs similar to the Trust. Market and financial conditions, and other conditions beyond the Sponsor’s control, may make it more attractive to invest in other financial vehicles or to invest in Bitcoins directly, which could limit the market for the Shares and reduce the liquidity of the Shares.
The Blended Bitcoin Price may be affected by the sale of DMBA ETPs tracking the price of Bitcoins.
To the extent DMBA ETPs tracking the price of Bitcoins are formed and represent a significant proportion of demand for Bitcoins, large redemptions of the securities of these DMBA ETPs could negatively affect the Blended Bitcoin Price and the price and NAV of the Shares.
Political or economic crises may motivate large-scale sales of Bitcoins, which could result in a reduction in the Blended Bitcoin Price and adversely affect an investment in the Shares.
As an alternative to fiat currencies that are backed by central governments, Digital Math-Based Assets such as Bitcoins, which are relatively new, are subject to supply and demand forces based upon the desirability of an alternative, decentralized means of buying and selling goods and services, and it is unclear how such supply and demand will be impacted by geopolitical events. Nevertheless, political or economic crises may motivate large-scale acquisitions or sales of Bitcoins either globally or locally. Large-scale sales of Bitcoins would result in a reduction in the Blended Bitcoin Price and adversely affect an investment in the Shares.
In zijn antwoorden stelt de minister dat de ‘alternatieve virtuele munteenheid’ Bitcoin wat hem betreft niet erkend kan worden als ‘elektronisch geld’, omdat de valuta niet voldoet aan de eisen die Nederlandse wet daaraan stelt.
Nu.nl schrijft dat “…ongeveer 2 procent van het totale aantal Bitcoin-gebruikers ter wereld Nederlander is en dat deze Nederlanders voor ongeveer 20 miljoen euro aan Bitcoins bezitten.” Verder voldoet Bitcoin niet aan de definitie die momenteel wordt gehanteerd voor ‘electronisch geld’, omdat de houder van een Bitcoin geen claim heeft tegen de uitgever van Bitcoins.
Rijksoverheid meldt verder dat “Minister Dijsselbloem van Financiën geeft aan dat de alternatieve virtuele munteenheid Bitcoin vooralsnog geen risico vormt voor financiële stabiliteit. … De opkomst van Bitcoin lijkt bepaald te worden door de speculatieve vraag hiernaar.”