State of Blockchain 2015 1
State of Blockchain 2015 10 September 2015 Consensus 2015 @GarrickHileman #Consensus2015 on Twitter and sli.do

1. Industry Overview 2. State
of Bitcoin 3. State of Blockchain

1. Industry Overview

All-Time Venture Capital Investment in
Bitcoin & Blockchain Startups $894m Note: Q3 2015 projectedbased on run rate as of Sept. 7 2015 Data sources: CoinDesk, CrunchBase

23 Countries with VC-backed startups
Sources: CoinDesk, CrunchBase.Images from Wikipedia Switzerland Sweden Philippines South Korea Kenya Singapore Panama Japan Canada The Netherlands India Barbados Mexico France Australia Luxembourg United States Israel Denmark Argentina Germany United Kingdom China

$362 $250 $0 $50 $100
$150 $200 $250 $300 $350 $400 2014 Bitcoin VC Investment Exceeded Early-Stage Internet Investment Note: Internet figures includeonly first sequence venture deals. All figures unadjusted for inflation, changes in the cost of launching a startupover last two decades, etc. Further methodology discussion. Data sources: CoinDesk, PricewaterhouseCoopers 2014 Bitcoin 1995 Internet Bitcoin vs Early Internet VC Investment ($m) Millions

2015 YTD Investment +94% vs.
2014 $224m $436m 2014 VC investment (as of Sep. 7) 2015 YTD VC investment Data sources: CoinDesk, CrunchBase

Bigger VC Deals Suggest Healthy
Funding Environment *Note: 21Inc. Is excludedbecause theprecise timing of when the$116m was raised by 21 Inc. in various individual stages, has not beenrevealed. Source: CoinDesk $10 $20 $30 $40 $50 $60 $70 $80 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2 Millions *

Total VC Investment and Average
VC Deal Size Projected to Plummet in Q3 Note: Q3 2015 projectedbased on run rate as of Sept. 9 2015 Data sources: CoinDesk, CrunchBase Millions Millions $74 $133 $228 $145 $81 $3 $4 $10 $10 $8 $0 $2 $4 $6 $8 $10 $12 $0 $50 $100 $150 $200 $250 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Quaterly VC Investment ($m) Quarterly Total VC Investment ($m) QuarterlyAverage VC Investment Deal Size ($m)

$362 $631 $250 $639 $0
$100 $200 $300 $400 $500 $600 $700 2015 Bitcoin VC Projected to Fall Behind of Early-Stage Internet Note: Internet figures includeonly first sequence venture deals. All figures unadjusted for inflation, changes in the cost of launching a startupover last two decades, etc. Further methodology discussion. Q3 2015 projected basedon run rate as of Sept.9 2015 Data sources: CoinDesk, PricewaterhouseCoopers 2014 Bitcoin 2015 Bitcoin - Projected 1995 Internet 1996 Internet Bitcoin vs Early Internet VC Investment ($m) Millions

BitLicense Imposes High Costs on
Startups Source: CoinDesk. Image from BitStamp • Bitstamp NY license application cost roughly $100k George Frost Chef legal officer, Bitstamp Ceased NY Operations 15 BitLicense Applications 22

Dark Market Bitcoin Transactions Approximately
Equal to BitPay Transaction Volume Sources: Soska and Christin (2015) ‘Measuring theLongitudinal Evolution of theOnline Anonymous Marketplace Ecosystem’, CoinDesk BitPay Dark Market

Regulators Don’t Want to Kill
the Golden Goose Images from Google • Initial sales tax moratorium • Avoided costly phone company designation

Xapo Moves Headquarters from Silicon
Valley to Switzerland Citing Customer Privacy Concerns 14Source: CoinDesk • “This is not to facilitate crime, this is to protect privacy” • “There are some customers that will bring more balances if we do this and there are some customers who have said ‘we will work with you if you do this’”Wences Casares Xapo CEO

2. State of Bitcoin

Bitcoin Academic Research Increased Exponentially,
33% of Publications Economics Related Note: data collection for 2015is still in progress. Sources: search ‘Bitcoin’ on JSTOR, Science Direct, Ingenta,Microsoft academic search, SpringerLink, SSRN, Taylor and Francis, Wiley, ArXiv, Oxford Journals and Cambridge Journals. Peer-to-Peer Review: The State of Academic Bitcoin Research 2014 Number of Bitcoin Academic Research in Each Year Distribution of Bitcoin Academic Research Economics 33% Finance 8% Accounting 1% Computer Science & Engineering 16% Cryptograph y and security 12% Environment 1% Law 19% Politics 2% Sociology 8% 0 50 100 150 200 250 2008 2009 2010 2011 2012 2013 2014 2015

Q3 Most-Viewed CoinDesk Articles; Four
Articles are Related to Bitcoin’s Price Rank Title Date 1 Bitcoin price falls 14% following Bitfinex 'flash crash' August 19 2 Wedbush report projects $400 bitcoin price by 2016 July 10 3 Russian president Vladimir Putin addresses digital currency July 14 4 Bitcoin price slumps following Bitfinex outage August 24 5 8 banking giants embracing bitcoin and blockchain tech July 27 6 Coin.Mx execs arrested for operating illegal bitcoin exchange July 21 7 Bitcoin 'forked' in controversial bid to resolve scalability question August 17 8 Bitcoin price falls below $200, hits six-month low August 25 9 Forget gold, bitcoin is backed by time July 4 10 Double spending risk remains after July 4th bitcoin fork July 6 Source: CoinDesk top 10 stories basedon page views CoinDesk’s Top 10 Most Viewed Stories in Q3

$200 $220 $240 $260 $280
$300 $320 1-Jul 8-Jul 15-Jul 22-Jul 29-Jul 5-Aug 12-Aug 19-Aug 26-Aug 2-Sep Bitcoin Price Volatility Returned in Q3 9 August Bitcoin exchanges Kraken and Bitfinex cut services in New York Source: CoinDesk Bitcoin Price Index, daily datacollectedat 00:00 UTC 6 July Double spending risk remains after July 4th bitcoin fork Mt Gox CEO Mark Karpeles arrested in Japan 1 August 30 August UK banking giant Barclays to allow charities to accept bitcoin 21 July Bitcoin exchange itBit launches OTC trading desk 30 July Ethereum launches long-awaited decentralized app network 17 August Bitcoin ‘hard fork’ proposed in controversial bid to resolve scalability question 14 July Bitcoin price rallies amid financial uncertainty in China and Greece

Greece is Not Alone: 24
Countries Have an Ongoing Debt Crisis … Sources: Jubilee Debt Campaign, Guardian. Images from Wikipedia Tunisia St Vincent and the Grenadines Portugal Sri Lanka Jamaica Spain Montenegro Ireland Croatia Marshall Islands Greece Costa Rica Macedonia Zimbabwe El Salvador Belize Lebanon Sudan Grenada Dominican Republic Armenia The Gambia Ukraine Cyprus

… and 14 More Are
Vulnerable to a Debt Crisis Samoa Ethiopia Laos Mauritania Dominica Cape Verde Senegal Bhutan Ghana Tanzania Uganda Sao Tome e Principe Mozambique Mongolia Sources: Jubilee Debt Campaign, Guardian. Images from Wikipedia

Major Events that Would Possibly
Impact Bitcoin Price: Interest Rate Hike-Strong US Dollar Source: itBit report: Impact of US Interest Rate Hike on Bitcoin

Projecting a 43% Increase in
Q3 New Wallets Over Q2 *Note: Q3 2015 projectedbased on run rate as of Sept. 9 2015 Data source: Blockchain.info 118.286 514.583 481.258 343.121 480.715 451.294 454.435 488.303 696.436 0 100 200 300 400 500 600 700 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15* Thousands Number of New Wallets Added Each Quarter

Expedia: Purchases With Bitcoin Are
Down 40% • The lack of overall understanding regarding bitcoin was again an inhibiting factor • "If we give them a bitcoin payment, they don't know what to do with it, it's not a currency they understand.” • "We accept bitcoin as a way of just allowing customers to pay with whatever method they want to pay. For us, bitcoin is on an even playing field with the other payment types we offer." Source: CoinDesk Connie Chung Senior payments product manager at Expedia

Factoring in Remittance Fees Makes
Sub-Saharan Africa Most Fertile Market for Bitcoin Source: Hileman (2014) ‘Bitcoin Market Potential Index’, LondonSchool of Economics working paper Announcement article: http://www.coindesk.com/argentina-most-likely-adopt-bitcoin/ BMPI Regional Distribution - Top 30 BMPI Regional Distribution - Top 10 Post-Soviet/ Communist, 10% Sub-Saharan Africa, 40% US & Canada, 10% Latin America, 20% Middle East & North Africa, 10% Europe, 10% Asia, 0% Post-Soviet/ Communist, 17% Sub-Saharan Africa, 40% US & Canada, 3% Latin America, 17% Middle East & North Africa, 13% Europe,3% Asia, 7%

North America and Europe Continue
to Have the Most Bitcoin-Accepting Businesses Source: coinmap.org (screenshot of 9 September 2014 and2015)

As Hype Surrounding iPhone 6
Launch Has Diminished So Has Apple Pay Usage Sources: Pymnts.com, Bank Innovation March 2015 June 2015 Percentage of eligible Apple Pay users who had tried the service 15.1% 13.1% Usage of Apple Pay in transactions 39.3% 23% Committed user 48% 33% Not sure how it works 31% 34% Forgot to use 32% 34% Concern about security 15% 19% Fears about it working 1% 4% When it comes to using a new payment rail, people have similar concerns about security and how it works, regardless of whether it is Apple Pay or Bitcoin

3. State of Blockchain

Oct.
2015

‘Wall Street’ Should Take Blockchain
Technology Seriously Sources: YouTube, CoinDesk, LinkedIn “Distributed ledger technology does have the potential to be disruptive in certain business models, but it has at least as much potential to be enormously empowering in existing middle business models in terms of making them lower cost, more efficient and less risky.” “So we won’t get there overnight but we will get there. How seriously should you take this? I would take it about as seriously as you should’ve taken the concept to the Internet in the early 1990s. It’s a big deal and it is going to change the way that our financial world operates.”Blythe Masters, CEO of Digital Assets Holdings LLC

‘Wall Street’ Is Taking Blockchain
Technology Seriously Source: The Financial Services Club's Blog. Images from LinkedIn Jay Reinemann Executive director of BBVAVentures Duncan Niederauer CEO of NYSE Euronext John Reed Chairman and CEO of Citibank Thomas F Dapp Research Analyst, Deutsche Bank Oliver Bussmann CIO, UBS Bob Greifeld CEO, Nasdaq

Engaged in independent experimentor partnered
with bitcoin startups Published reports on blockchain or bitcoin Invested in bitcoin startups Banks Embracing Blockchain Technology in 3 Ways Sources: Fidor Bank, CBW Bank, RBS, ANZ, Westpac, Commonwealth Bank , Santander, Llyods Bank, BNP Paribas, Goldman Sachs, BBVA, Barclays, Let’s Talk Payment, CoinDesk

Startup Ecosystem: Seven Different Industry
Sectors Payment Processing Wallets Mining Financial Services Exchanges Infrastructure Source: CoinDesk Universal

New Ecosystem Framework?: Bitcoin (currency),
Blockchain (non-currency), Hybrid (both) Source: CoinDesk Non-CurrencyCurrency Hybrid

Blockchain & Hybrid Startups Have
Raised $248m of total VC Funding to Date, Represent 22% of Companies Data sources: CoinDesk, CrunchBase Currency, 71% Non- currency, 13% Hybrid, 16% Total VC Raised ($m) Currency, 78% Non- currency, 20% Hybrid, 2% No. of Companies

Oodles of Blockchain Use Cases
Source: let’s Talk Payment

BMPI2: Market Potential Index for
Ranking Blockchain Opportunities • Cost • Speed • Competition and alternatives • Market size • Other barriers to adoption (eg regulation)

State of Blockchain 2015 37
State of Blockchain 2015 10 September 2015 Thank You @GarrickHileman #Consensus2015 on Twitter and sli.do