#19 Binance’s $200m investment in Forbes brings traditional media to Web3. Bitcoin mining is capable of having a positive net emissions impact.
Bringing traditional media to Web3: Binance’s $200m investment in Forbes
Forbes announced that Binance will invest $200m in its PIPE (or “Private Investment in Public Equity”) offering as part of its plans to list in New York via a SPAC merger. The 105 year-old news publisher agreed to go public last year in August through a merger with blank-check company Magnum Opus Acquisition, a SPAC backed by the Hong Kong-based investment firm L2 Capital.
A SPAC merger has been one of the most popular alternative methods of going public in the past two years. A Special Purpose Acquisition Company is set up by a Sponsor and loaded with cash from an IPO raise with the sole purpose of finding the right private target to take it public in a predefined timeframe (though some variations have been seen with Bill Ackman’s Pershing Square investment in Universal Music). As part of the transaction, on top of the cash held in the trust, the SPAC can raise additional equity in the form of a PIPE, which provides price discovery, validation and de-risks execution before entering into a definitive agreement. The PIPE market has dried up significantly in recent months as there have been some strong headwinds in the form of poor performance and increasing regulatory scrutiny. In these market conditions the $200m investment was announced, which represents 50% of the total PIPE offering. It follows several months of negotiations after the crypto firm approached Forbes about a potential investment.
Binance has announced that its investment is targeted at assisting the company in making the transition to Web3 as in CZ’s view Forbes is still a Web1 platform. Binance would help the company with its blockchain and crypto strategies, including exploring issuing NFTs, introducing read-to-earn and accepting BTC for subscriptions. Two high-ranking officials of Binance (Patrick Hillmann, Chief Communications Officer, and Bill Chin, head of Binance Labs) will join the Forbes board when the transaction closes. Based on the PF ownership in the SPAC merger investor presentation, Binance would end up owning 24.1% of the listed entity provided that there would be no investor redemptions.
CZ’s ambitions for disrupting traditional industries do not seem to end here. In an interview with CNBC, he mentioned that media is not the only industry that Binance will look at. They are scouting almost every sector and will try to make a few acquisitions or investments and bring the targets from a Web1 world to blockchain and Web3 and further drive adoption.
Razvan
The VEVE Trilogy (Part2)
The year is still 2020, and people have started talking more and more about NFTs. Everything is still fuzzy, and there is a common misconception that most early adopters have gone crazy by paying more and more on punks, rocks, kitties, and apes because they are trying to understand where the value is all that. That is a different matter, but that matter took all the attention away from something great that started to grow more and more. Silently, under the radar, VEVE is here to stay.
Al Khan and David Yu understood that it is just a matter of time until the big names will start to join the movement because of what it implies:
unlimited and unimaginable utilities in the real world and bridge to the Metaverse. So what were the first steps? Securing the partnerships.
Now, most businesses start with a partnership or two, start picking up some licenses, and see what comes next. But when you have the vision, you're not afraid to go all in. Because you already have 2 Aces in your hand: David Yu and Al Kahn.
You flop these great cards, and already your hand looks pretty strong.
On the way to the Metaverse, the best way to make people see what can be achieved and keeping in mind that everyone carries a phone, not yet some goggles or a VR headset, the VEVE App is soon to be launched with an extra feature.
Just before this Christmas of 2020, VEVE opens to the public. Augmented Reality for its collectibles included: you can see them on a table in front of you, looking through your phone, taking pictures with them, and understanding that one day you could do so much more. #metaverse
But there's a small setback. To have an app on Apple Store and Google Play, a different kind of currency than crypto, the OMI token that Ecomi owns had to be put in place. Introducing the Gems, 1Gem= $1 (+vat).
This setback is pretty much the main reason why so many people became reluctant to join because you can only buy in, not cash out. Not yet, whatsoever, because a plan is in place for the mid-term: migrating the VEVE NFTs to ImmutableX and the OMI token from the Gochain to Ethereum. Because doing so, the NFTs will be able to be purchased directly with crypto on any marketplace that supports ImmutableX (remember this aspect, I will call it the X-factor and talk about this in the 3rd part 😉)
Now, more to come next time, although I have a feeling that will need some more time together for this beautiful story and just finish on a cliffhanger, after the earlier flop, the turn card appears:
Marvel joins VEVE in this beautiful journey, together with its 80+ years of beautiful history and with a twist: Marvel decides to also put on the blockchain as NFTs the most important Comic Books ever (and they have more than 29.000 different comics), also readable in AR, starting with Marvel Comics 1, first launched on Aug 31st, 1939, one of the few still existing copies in real life being sold last year for $1.26mil.
On VEVE it was only $6.99. And $3 in the secondary markets sales at the time. Now flooring at $435 the common edition, up to $69K (as in thousands).
Remind me to tell you about the rarity of the VEVE NFTs. There are 5 of them.
Don't pic! Till next time.
Cosmin
Bitcoin mining capable of having a positive net emissions impact
Bitcoin’s environmental impact has always been a topic of discussion, from early forum posts to recent discussions in the US House of Representatives. However, in a recent report published by CoinShares Research, data shows that real energy use amounts to a rounding error on the global energy balance sheet, especially when compared to what it offers.
The three main findings of the report highlight the following:
The mining network’s electricity generation mix is more balanced than it has ever been.
2. Oil field Bitcoin miners serve two main benefits: they repurpose otherwise wasted natural gas resources to generate useful electricity and they reduce the carbon emissions of flaring and venting natural gas at oil sites.
In the process of drilling and extracting petroleum liquids, associated dry (natural) gas (which cannot be collected and transported) is released by being either burned on site, or vented directly into the atmosphere. Natural gas is predominantly made of methane, a greenhouse gas that is 30-times more potent than CO2 over a 100-year period. In that sense, each tonne of methane emitted is considered the same as 30 tonnes of CO2-equivalent emissions.
By removing this gas from flaring towers, oil field miners reduce the CO2 emissions of liquid petroleum wells while simultaneously extracting useful work from the otherwise wasted gas. This would be enough to completely offset all emissions or even have a positive net emissions impact.
3. Bitcoin mining is an essential puzzle piece in the stabilization of grids featuring high proportions of wind and solar generation.
Renewable energy sources only produce energy when the Sun shines and the wind blows. Given this unpredictability, grids with a large share of intermittent power generation cannot function properly without supply or demand balancing.If demand and supply fall out of balance, blackouts as well as grid congestion or waste can result. Bitcoin mining can solve these discrepancies as a load balancing system, by either quickly reducing consumption when power is in a shortage or increasing consumption when power is in a surplus which can strengthen and decarbonise grids.This finding reiterates Shell’s initiative started in 2021 of using blockchain solutions to enable the energy transition and accelerate the development of low-carbon energy.
To conclude, once we remove the noise made by skeptics trying to find another reason to resist the inevitable technological revolution we will be able to see the transformative impact blockchain technology can have for the energy sector. In 2018, the World Economic Forum, Stanford Woods Institute for the Environment, and PwC released a joint report which highlighted more than 65 existing and emerging blockchain use-case for the environment. Three years later these use cases are starting to facilitate and more importantly, drive the energy transition.
Evelyne
On Metagovernance - Can Crypto Improve where TradFi is Lacking?
DAO tokens are first and foremost governance tokens. Holders get to vote on decisions based on the amount of tokens they hold or stake. However, DAO tokens can also be used in various yield farming setups, or even deposited in on-chain managed portfolios (think index funds) such as Stakeborg DAO’s ILSI. Doing this is a great option for investors who either want to maximize their returns or minimize their risk. However, this leaves the main purpose of the tokens in an odd situation - if they are not controlled by the investor anymore, how can they be used for voting on proposals?
The answer is nontrivial, to say the least. To shed some light on this, let’s start by looking at TradFi and the size of the matter there. First of all, the equivalent of a DAO token in TradFi is simply a company (voting) share. Having a share in the company gives the holder one vote. Simple enough. Yet, most investments nowadays are done through index funds. The benefits are well known at this point. Diversification, low cost, low risk, market performance. What’s not to love? Because of this, Bloomberg writes that about 22% of an S&P 500 company’s shares are held by index funds. That, together with the fact that the top 3 managers (BlackRock, Vanguard and State Street) hold about 80% of all indexed money means that a significant amount of votes are clustered in very few hands. Even Jack Bogle, credited with inventing index investing, warns about this.
In typical Crypto fashion, the industry wishes to address this early on. Players like Indexcoop and PieDAO have already written about this. They both tackle the issue in the same way. Imagine there is an index containing Uniswap, and Uniswap has a new proposal up for voting. The index platform would mirror that proposal on their own Snapshot page. The index token holders would vote on it. Once the result is settled, the index contract would further vote for the respective outcome in the Uniswap proposal using its tokens under management. This is for sure one solution, but it has its downsides - the main being that it cannot achieve the same result as all index investors voting individually on Uniswap themselves. If the index vote goes 51% - 49% locally, on Uniswap it would be cast as 100% for the winning option.
As with everything in Crypto, we are still early and things don’t have to be perfect from the first attempt, but it’s important to be aware of the trade-offs and constantly strive for better.
Mihnea
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