Bitcoin Industry Needs Its Uber and Airbnb

Last night, Fintech Aviv, a Tel Aviv based fintech networking meetup hosted by CurrencyTransfer devoted the evening to the Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term sector. Similar to previous meetups, the evening included demos from startups and a keynote speaker. Demoing were representatives from Bitcoin Authenticator, Bitcoin Rated, Algobit and Polycoin (more on their presentations).

Beginning the evening was a keynote from Eden Shochat from venture capital firm Aleph. His talk centered on the opportunities involved with bitcoins and how it relates to their overall fintech industry.

Shochat explained that the internet has caused disruption in virtually every industry, with the travel sector the first to really be affected. However, highly regulated industries are taking longer to be disrupted. But more Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term means greater inefficiencies and potential opportunities for innovation. In this regard, Shochat specifically mentioned the financial industry.

Regulatory inefficiencies

As for examples of regulation and inefficiencies, Shochat cited that the remittance market is filled with fees since it caters to unbanked customers. As they don’t fall under a bank’s typical customer base, existing financial infrastructure ignores the unbanked. Elsewhere, he noted that in Europe and much of the world, bank wires are operated using the Swift agency. However, they don’t provide settlelement, which leads to lost funds among transfers sent between the largest banks in the world.

Another example is government monetary controls which inhibits the free flow of cash both domestically and abroad. As a side effect, this had created black market trades for foreign currencies and illegal transfer services. In regards to bitcoins, Shochat stated that the “Chinese are buying bitcoin miners with the yuan at a loss, just so they can get their money out of the country.”

A bitcoin Uber?

Shochat noted that internet disrupters tend to need to battle existing regulation. He brought Uber and Airbnb as examples, noting that of the billions of dollars Uber has raised, much of it is going towards funding legal battles they have in both existing and potential markets. However, Shochat explained that despite the friction against Uber, in their launch city of San Francisco, even though they have achieved $400 million of revenue in the region, the local taxi market in the city has remained untouched at around $135 million. This means that, rather than disrupting taxis, Uber has become an alternative to driving.

Shochat explained that in the taxi or hotel industry where an Uber or Airbnb can enter a market illegally, their potential punishment is limited to paying fines until they either exit the market or prevail in court to change regulation. However, this contrasts the financial industry where punishments often include jail time or seizing of funds.

The bigger picture is that the existing regulation, which limits the use cases of fintech and bitcoin, has caused the disruption opportunity to remain huge. As a result, the question is, who can combat this regulation problem to arrive at the opportunity referred to by Shochat and many others and be the Uber of the bitcoin industry?