Blockchain, the technology behind bitcoin, may hold the key to overhauling today's exchanges.
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What Blockchain Technology Can Do for You
By Andy Gordon, October 26, 2016
Dear Early Investor,
I have a dream...
That everybody can buy and sell shares of startups at any time and any place.
In a post last month, I described what this would look like...
Exchanges will soon be faster... as well as better at moving large amounts of money and matching sellers with buyers. Instant information on a company - even a small far-off one, in Nepal, say - won't be a problem. Instant access will be available to everybody on the cloud.
I called it the "holy grail"... a liquid market of private startup companies where billions of people around the world buy and sell shares.
And I said that by 2025 we "should be knocking on the door."
That's nine years away, not far off considering how creaky equity investing is and how illiquid startup investing is.
If anything, I thought I was being optimistic.
And it's true that I was way off. But not in the way you think.
Right now, there's a list of 25 countries agreeing to take "revenge" on the USA due to a certain American economic practice.
Even allies Canada, Britain and Qatar appear on the list! If you think "friends" turning their backs on us is bad... you won't believe what our enemies are up to. Our friends at The Oxford Club have full details here.
It could happen much sooner than 2025.
The technology is becoming available much faster than I thought.
Take OneChronos. I've mentioned this interesting startup before. It graduated from Y Combinator this past summer. It uses sophisticated techniques, including algorithmic game theory, machine learning and cryptography, to match buyers and sellers.
And it wants to level the playing field by eliminating the need to race over a network to get into a trade microseconds early.
Both its founders - Stephen Johnson and Kelly Littlepage - were trained in computer science. I wish them the best of luck.
The Technology Behind Bitcoin
But there's another technology that may hold the key to overhauling today's exchanges.
It's "blockchain" tech - the same accounting system that powers bitcoin.
Blockchain's decentralized ledger system has the ability to transform the underpinnings of exchanges, performing cross-border equity trades at lightning speeds while providing unmatched security.
(If you're interested in learning more about how it works, I suggest you read this article to quickly get up to speed.)
A number of startups are now using the blockchain for payment processing and money transfers. Circle Internet Financial is just one example out of many.
And not long ago, the Nasdaq started experimenting with blockchain technology to automate trading of private shares.
But an unknown startup from Estonia may be beating it to the punch. It's called Funderbeam and it's headed by Kaidi Ruusalepp. She was previously CEO of the Nasdaq Tallinn stock exchange.
Using blockchain technology, it provides a transparent and trustworthy platform for secondary trading - letting shareholders sell their stakes in a startup.
And - true to my vision of an exchange that can provide "instant information on a company" - Funderbeam's platform is also part research tool.
Aside from the Nasdaq's cautious flirtation with blockchain technology, Funderbeam is the first company (as far as I know) to build a securities trading platform on the blockchain.
Ruusalepp says, "Imagine if Bloomberg, AngelList and Nasdaq had a baby."
But it won't be easy.
Confidential information is a problem of access, not technology. And the rules of almost every country, including the U.S., need to change to allow a global and frictionless cross-border exchange of securities to take place.
Blockchain technology has a plethora of applications. But we're at the very beginning of a long runway here. Even the blockchain's most proven and well-known application - bitcoin - has had setbacks and delays in being adopted.
Funderbeam's vision is incredibly ambitious. It won't happen overnight.
But the technology no longer seems to be the main obstacle. Rather - and this is no outrageous prediction by any means - it will be the governments of the world that fear the free flow of money and equity across borders.
But one step at a time. That's another subject altogether.
The average American investor makes just 2.5% per year in stocks. Find out why private investing may be better. Read on...
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Lysosomal storage disorders are individually rare but collectively common. The study of these diseases is not only leading to better treatments, but also revealing many of the secrets of this underappreciated organelle.
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Back to basics: luring industry back into neuroscience pp1383 - 1384 Steven E Hyman doi:10.1038/nn.4429 An obsession with producing and validating models (face, construct, predictive validity) has led many of us down a deep rabbit hole, thinking about models instead of mechanisms. Advances in the human genetics and neurobiology of brain disorders create exciting new opportunities, but only if we can get back to basics.
On being a circuit psychiatrist pp1385 - 1386 Joshua A Gordon doi:10.1038/nn.4419 Recent technological advancements in the study of neural circuits provide reasons to be optimistic that novel treatments for psychiatric illnesses are just around the corner. Maximizing the chances of translating these advancements into real improvements in patient care requires a carefully considered road map.
Psychiatric distress in animals versus animal models of psychiatric distress pp1387 - 1389 Robert M Sapolsky doi:10.1038/nn.4397 Primatology research suggests that other primates suffer from crippling depression or anxiety, implying that these diseases' roots pre-date human history. At the same time, some realms of psychiatry remain uniquely human. Recognizing the similarities and dissimilarities between us and other primates is essential in studying animal models of psychiatric disease.
The origin and natural history of autism spectrum disorders pp1390 - 1391 James C Harris doi:10.1038/nn.4427 Refined social phenotyping of syndromic and idiopathic forms of autism, combined with advances in genetics, animal models of syndromes and brain imaging, may facilitate discovery of shared brain mechanisms that will lead to new treatments. The reversal of social deficits in animal models is promising for eventual translation into therapeutics.
Translating genome-wide association findings into new therapeutics for psychiatry pp1392 - 1396 Gerome Breen, Qingqin Li, Bryan L Roth, Patricio O'Donnell, Michael Didriksen et al. doi:10.1038/nn.4411 The Psychiatric Genomics Consortium is aiming to analyze data from >1 million individuals. This is already leading to hundreds of new genetic findings across psychiatric disorders with the potential to restart largely stalled psychiatric drug development pipelines. This paper outlines key questions and plans to translate findings into new therapeutics.
The road to precision psychiatry: translating genetics into disease mechanisms pp1397 - 1407 Michael J Gandal, Virpi Leppa, Hyejung Won, Neelroop N Parikshak and Daniel H Geschwind doi:10.1038/nn.4409 Recently, robust identification of hundreds of genetic variants associated with risk for neuropsychiatric disease has prompted new challenges in understanding their biological impact within an individual. The authors provide a framework for interpretation of genetic risk variants to uncover disease mechanisms and facilitate therapeutic development.
Lessons learned from studying syndromic autism spectrum disorders pp1408 - 1417 Yehezkel Sztainberg and Huda Y Zoghbi doi:10.1038/nn.4420 Autism spectrum disorders are highly heterogeneous and include both idiopathic and syndromic forms. Sztainberg and Zoghbi discuss insights gained from studying syndromic autism spectrum disorders and their potential contribution to our understanding of the molecular pathways critical for normal cognitive and social development, as well as the relevance to idiopathic autism.
Rare variants are common in schizophrenia pp1426 - 1428 Jacob Gratten doi:10.1038/nn.4422 A large DNA sequencing study of schizophrenia finds more evidence that rare inherited coding mutations across many genes contribute to risk of the disorder. This has important implications for geneticists and neuroscientists alike.
Brains, genes and power pp1428 - 1430 Frank W Albert doi:10.1038/nn.4424 Gene expression data from more than 500 human brains shed light on the molecular consequences of genetic variation that contributes to schizophrenia.
When size matters: CHD8 in autism pp1430 - 1432 Martin W Breuss and Joseph G Gleeson doi:10.1038/nn.4431 Recent models studying loss of the mouse homolog of the autism-associated gene CHD8 show altered Wnt signaling, cell fate and proliferation. How do these findings shape our understanding of this disease?
At the request of our customers, Wako's antibody for the microglial marker Iba1, is now available in labeled forms. Choose from 2 types - one conjugated with Biotin and the other with Red Fluorochrome (635). This can eliminate the need for a secondary antibody, and provides reduced background.
Increased burden of ultra-rare protein-altering variants among 4,877 individuals with schizophrenia pp1433 - 1441 Giulio Genovese, Menachem Fromer, Eli A Stahl, Douglas M Ruderfer, Kimberly Chambert et al. doi:10.1038/nn.4402 Using whole-exome sequencing, the authors identified 244,246 coding-sequence and splice-site ultra-rare variants (URVs) and found that gene-disruptive and putatively protein-damaging URVs were significantly more abundant in schizophrenia cases than in controls. The excess of protein-compromising URVs was concentrated in brain-specific genes, particularly in neuronally expressed genes whose proteins are located at the synapse.
Gene expression elucidates functional impact of polygenic risk for schizophrenia pp1442 - 1453 Menachem Fromer, Panos Roussos, Solveig K Sieberts, Jessica S Johnson, David H Kavanagh et al. doi:10.1038/nn.4399 The CommonMind Consortium sequenced RNA from dorsolateral prefrontal cortex of subjects with schizophrenia (N=258) and control subjects (N=279), creating a resource of gene expression and its genetic regulation. Using this resource, they found that [sim]20% of schizophrenia loci have variants that may contribute to altered gene expression and liability.
Chd8 mediates cortical neurogenesis via transcriptional regulation of cell cycle and Wnt signaling pp1477 - 1488 Omer Durak, Fan Gao, Yea Jin Kaeser-Woo, Richard Rueda, Anthony J Martorell et al. doi:10.1038/nn.4400 De novo mutations in CHD8 are associated with autism spectrum disorder, but the basic biology of CHD8 remains poorly understood. Here the authors find that Chd8 knockdown during cortical development results in defective neural progenitor proliferation and differentiation that ultimately manifests in abnormal neuronal morphology and behaviors in adult mice.
Ucn3 and CRF-R2 in the medial amygdala regulate complex social dynamics pp1489 - 1496 Yair Shemesh, Oren Forkosh, Mathias Mahn, Sergey Anpilov, Yehezkel Sztainberg et al. doi:10.1038/nn.4346 Social encounters are associated with varying degrees of stress. The authors show that modulation of stress system components in the medial amygdala alters preference for familiar vs. novel conspecifics. Inhibition of the relevant circuit in a group of familiar mice kept under semi-natural conditions increased pro-social behavior.
Histone deacetylase 3 associates with MeCP2 to regulate FOXO and social behavior pp1497 - 1505 Alexi Nott, Jemmie Cheng, Fan Gao, Yuan-Ta Lin, Elizabeta Gjoneska et al. doi:10.1038/nn.4347 Mutations in MECP2 cause Rett syndrome. The authors show that a MeCP2-HDAC3 complex positively regulates a subset of neuronal genes through FOXO recruitment and deacetylation, and that HDAC3 loss contributes to cognitive and social deficits in mice. Rett-patient-derived cells exhibited similar HDAC3-FOXO-mediated transcriptional impairments and were rescued by gene editing.
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