Blockzero Jed McCaleb Interview: My Outlook on XLM
In terms of price trends, we recently saw a bit of a dip, with Ethereum and bitcoin losing about 10% no reason. I am staying away from this market until it starts to act according to good news and bad news. All of this bouncing around for no reason just smells like market manipulation and/or stupidity. Two things I don’t trade into.
As I have looked through the content YouTube “stars” and some of the more well-known cryptocurrency enthusiasts are putting out, I am noticing one shocking thing. They come up with new coins daily to invest in. They just poof one out of thin air, they say how great the idea (not the business) is, and that it could change stuff. Wow. Well, I pride my reputation on being a broken record. I only like 4-5 coins, and I only talk about those coins. I don’t invest in anything else, nor do I want to talk about anything else. Stellar Lumens is one of those coins, and a great interview just came out with CEO Jed McCaleb. Although I have followed what Jed has said throughout Stellar’s business cycle since 2014, hearing him talk about the market right now (as of Feb. 8) was something I sorely needed as an investor when XLM is trading at a mere $0.38.
Most of these coin projects have founders who shouldn’t be anywhere near a microphone, as their explanations of their businesses is actually detrimental to marketing, not helpful. Digging into deep technical jargon on a public forum when you are supposed to be marketing your coin is not helping anyone. There are so few people who understand blockchain that companies are paying high s9x figure salaries for amateurs. Marketing should be an explanation on who’s buying, why, and how much. Jed did exactly that in his interview. He talks faster than a New York City stock broker on speed, but wants to provide only information that will give investors better insight into the XLM business; not the deep tech of the coin. I will touch on some of the key points that I loved: update on corporate relationships, innovations for public use, and ICO platform.
CEOs are not often people who talk candidly. They are the head salespeople of the firm, and everything has to be perfect at the company. Jed is taking a humble blockchain approach. He wants to make sure that the record is straight about what partners are doing at Stellar, and how it will help/affect XLM specifically. Case in point: he said explicitly that bank relationships are far off for Stellar, and the market as a whole. He admitted the banks he works with are very early on in the sales cycle, and that 1,000+ year incumbents aren’t too used to working with new entrants. The trial runs and beta versions are all common practices in every industry. They don’t mean adoption. This was a surprise to me. I was under the assumption that these banks had a fire lit under them to catch up to blockchain. It seems they aren’t in a hurry, or just making it seem that way.
This is where it gets good. Jed has since re-shifted focus to companies that he knows will be immediate adopters, just because of how easily it can fit into their structure. Remittance companies (Western Union, Moneygram, etc.) are the low hanging fruit in his mind. These are high volume transfers of cash, with high fees to come with it. The biggest demographic of remittances are obviously foreign workers, who also happen to be the last people who can afford to spend 5-10% of their capital on transfer fees. With an industry size of $500 billion in 2016, remittances can feed quite a few companies that have friendly corporate technology.
XLM is a shell. It can take form of fiat currency, transfer anywhere in the world, and settle in a bank account in any currency. There are 300 coins that claim they can be the new PayPal, and most them are still spouting off about decentralization. This is a company that wants control mechanisms so it can give tangible control to their corporate customers.
The way he spoke about his corporate partnerships is translucent. He doesn’t tweet (says he only watches, not talks) out random fodder that happens each day. He wants to be the business person that people can depend on. People will go back and read through the information that all of these coins put out during late 2017/early 2018. I think his spot in the annals of the crypto boom will prove to be very noble. I am happy with remittances, and I am happy he was open that banks just aren’t there yet. I haven’t heard anyone else admit it, have you?
I was unaware of the infrastructural scope that Stellar has built since 2014. Jed created a conglomerate, not a business. He has a platform for the public to launch DAPPs/smart contracts, token offerings, and an exchange soon capable of atomic swaps (no base currency; you can trade LTC for KMD). His main goal is to create an exchange capable of housing the U.S. cryptocurrency market, while also having ICOs launching on it in tandem. The recent $30 million ICO of Mobius (I don’t invest in any ICOs) had all the looks and smells of a compliant offering. If the exchanges play well with the government, we can see some very big moves.
The next public project was partnered out. Because remittances are so large, the big companies are just necessary evils in the early adoption phase. He is working with a confidential company on creating a global Venmo-type network that can work directly with any kind of bank account. You can send USD from an American bank account, and it will deposit in yen in a Japanese bank account. All on the app in 3-5 seconds. XLM was designed specifically for this purpose, and its use cases are beginning to take up speed. XLM is the sought after technology, not private chaining. I am very excited to see what he comes up with here because this fiat currency settlement mechanism is almost monopolistic right now.
Staying far away from ICOs right now, even Stellar’s. But that doesn’t mean that we shouldn’t find the winning race horse before the race. Stellar’s platform works with fiat currency, and it can launch ICOs. Need I say more? I have harped on this fact many times, but this is just too good not to repeat. If central banks, corporations, institutions, and high net-worth individuals feel comfortable enough with Stellar’s way of handling their native paper currencies, we could see Regulation D token securities being offered on Stellar. Big American business is waiting for the rulebook to be written, and then they will pounce. Stellar is already working with banks in the South Pacific with America’s tech darling IBM: we are seeing the heir being groomed in my opinion. All of the information listed is leading to me to a rather large conclusion.
My conclusion is getting fast out of XRP, and putting it all into XLM. XRapid, Xcurrent, X-me out of this XRP business. Ripple is creating blockchain systems, and has gotten the taste of private chain revenue. Their coin does not need to be used, and each company they work with has specific press releases saying they aren’t using XRP. On the contrary, we have the head of blockchain for IBM saying they love XLM, and are actively working together to introduce it to banks. XLM, not just Stellar. That is crucial for coin holders. I am not running over to the computer to sell right now, but I will get up to my basis, and exit. I will most likely keep some for a Coinbase push, but XLM needs more of Raiden’s money. Jed McCaleb has created 3 gigantic blockchain companies (Mt. Gox, Ripple, Stellar), and smart money doesn’t bet against him. I sure won’t be.
This is not a recommendation to buy cryptocurrencies. I am not buying or selling anything right now, and I suggested you don’t either. If you do, be aware of the risks. I wish you the best of luck.
Disclaimer: The author has an investment stake in XRP.
Featured image courtesy of Shutterstock.