Fundstrat Bitcoin & Blockchain presentation for Upfront Summit

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Fundstrat Global Advisors
150 East 52nd St, 31st floor | New York, NY 10022
Bitcoin and Blockchain
Trust, Millennials and ...

Slide 2
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Slide 3
Overview
Digital Trust
Millennials driving change
Crypto is an asset class
Why Wall Street will care

Slide 4
Figure: Trust in U.S. Government at 60-year lows
% who trust the US government in Washington always or most of the...

Slide 5
Figure: Few countries see their citizens trust their government
Question is what % “Trust the national government ...

Slide 6
Blockchain and bitcoin growing faster outside the US
Bitcoin and blockchain are attractive
outside the US because ...

Slide 7
Earlier in 2016, Facebook IQ,
a team of researchers,
scientists and analysts funded
and supported by Facebook
Inc....

Slide 8
Blockchain enables digital money to exist with trust…
Paper money Credit card / Electronic
Digital money Blockchai...

$Slide 9 Figure: Examples of fractionalization to digital asset tokenization Not a complete list Asset tokenization is an e...$

Slide 10
Figure: Illustrative example of a token for a social media company
Simply a concept, please do not judge this to ...

Slide 11
Figure: Illustrative example of a token for a digital based business
Simply a concept, please do not judge this t...

Slide 12
Risks
• Mining conglomerates becomes too powerful and essentially
takeover the blockchain.
• Millennials decide t...

Slide 13
Overview
Digital Trust
Millennials driving change
Crypto is an asset class
Why Wall Street will care

Slide 14
Figure: Comparative size of generations
Population in millions
Millennials are largest population cohort ever
Sou...

Slide 15
Figure: What did each generation look like in their 20s
Fundsdtrat and public information
Demographics: Looking a...

Slide 16
Each generation sees innovations… its mostly digital today
Source: Fundstrat
Figure: Innovations seen when each g...

Slide 17
Figure: Topix vs S&P 500
Boomers: By 1975, many would have said Japan stock bubble peaked…
Source: Fundstrat, Blo...

Slide 18
Figure: Topix vs S&P 500
Boomers: Good thing “bosom buddies” didn’t listen to bubble talk…
Source: Fundstrat, Blo...

Source: Fundstrat, Bloomberg, Updata
Slide 19
Figure: Life cycle of Millennial spending and income
Survey of Consumer Fina...

Source: Fundstrat, Bloomberg, Updata
Slide 20
Figure: Composition of Generations by age group
Census bureau
Source: Fundst...

Source: Fundstrat, Bloomberg, Updata
Slide 21
Source: Fundstrat, Bloomberg, Factset
Housing follow generations and implies...

Source: Fundstrat, Bloomberg, Updata
Slide 22
Figure: Composition of Generations by age group
Census bureau
Source: Fundst...

Slide 23
Silent Generation bought gold…
Millennials
aren’t buying
Gold…
Gold
As shown below, the Silent Generation was in ...

1962 1980
1999
2018
2036
1.0
11.0
21.0
31.0
41.0
51.0
61.0
71.0
81.0
91.0
101.0
1930
1933
1936
1939
1942
1945
1948
1951
19...

1
11
21
31
41
51
61
71
81
91
1930
1933
1936
1939
1942
1945
1948
1951
1954
1957
1960
1963
1966
1969
1972
1975
1978
1981
198...

0.01
0.1
1
10
100
1000
10000
100000
1000000
10000000
2010
2012
2014
2016
1980
1999
2018
2036
1.0
11.0
21.0
31.0
41.0
51.0
...

Slide 27
Overview
Digital Trust
Millennials driving change
Crypto is an asset class
Why Wall Street will care

Slide 28
Regulation: St Louis Fed is constructive on bitcoin and blockchain…
Source: https://files.stlouisfed.org/files/ht...

Textbook 30-yrs ago… Reality today…
IPOs
Only profitable Technology
companies go public…
% profitable at IPO
1980-1995
ave...

Slide 30
Digital Store of Value addresses $280T market…
20-yr
CAGR
Value
($ billions) % Total
Gold Estimate Fundstrat 5.0 ...

Slide 31
Figure: Annual World Gold Production
Units in metric tons. Thru 2015. From US Geological Survey
Gold supply growt...

Dec '35
$35
Feb '75
$184
Jan '80
$684 Dec '87
$493
Sep '11
$1,789
Jul '17
$1,223
Dec '35
1157%
Feb '75
773%
Jan '80
1879%
...

Slide 34
Figure: General categories of tokens
Per Fundstrat
Store of Value still best. Is 2018 the year we see growth in t...

High-net worth families allocate $1.6T to Art…
Per PrivateInvestor.com
Art cannot be compared to
traditional assets such a...

3.0%
-20%
0%
20%
20-yr CAGR
Slide 36
Art has appreciated at 3% gross 20-year CAGR…
0
1
4
16
64
256
1,024
4,096
16,384
1875...

Slide 37
Figure: Key variables in valuing Bitcoin and other cryptocurrencies
$ trillions, except bitcoin value
Framework f...

Slide 38
Figure: Alt-coins surged since December
Based on the liquid universe of alt-coins. 57 in 2014. 250 in 2015. 400 i...

Figure: Correlation Matrix (%)
Based on the daily return of last 90 days
Source: Coinmarketcap.com, Bloomberg, other sourc...

How to read this: the “Highest/Lowest
Win Ratio” based on past 90-day daily
return. High Win Ratio means the
cryptocurrenc...

Slide 41
Overview
Digital Trust
Millennials driving change
Crypto is an asset class
Why Wall Street will care

Slide 42
Figure: Comparative Profitability
Estimates for Coinbase
Profits to be made: Coinbase profitability may exceed IC...

Slide 43
Figure: Market Cap of Country Stock Markets
$
Cryptoassets are larger than most country equity markets…
Source: F...

Slide 44
Crypto-currencies are simply not correlated to equities, bonds, gold, HF.
Bitcoin
FS
CryptoFX
10
FS
CryptoFX
40
F...

12.4%
6.4%
(11.5%)
2.0%
(20%)
(10%)
0%
10%
20%
30%
90Dcorrelation
6.1%
10.2%
6.4%
8.3%
(9.0%) (7.6%)
18.2%
0.7%
-20%
-15%
...

Source: Fundstrat, Bloomberg, Updta
$120.68
$128.54
$141.01
$168.89
$90
$180
10/2/2014
11/2/2014
12/2/2014
1/2/2015
2/2/20...

Disclosures
This research is for the clients of Fundstrat Global Advisors only. For important disclosures and rating histo...