Or does it need to be distinguished? Is there space for two?
Iconomi and its relation to Indicium is described in this article:
Got it thanks.
So Iconomi has an option that allows individuals to create their own baskets. Incidium has one giant basket for all its investors and we all vote on which ones to invest in?
Indicium will make algorithmic baskets, while iconomi is more focused on marketcap and make-your-own baskets. There is a large space to fill, the two projects can easily coexist.
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Once the inrastructure is operational, It is rather easy to add more product funds for different customer needs. Expanding product line is in the plan. Hosted funds offered by third parties and even invdually tailored products are all possible…
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One need only look to traditional equities markets to see that there will likely be demand for hundreds, if not thousands, of different funds. Index funds in traditional equities markets are not all distinguishable from each other. Many are almost exactly alike. So why do they co-exist? Because the whole point of index funds is to lower risk. Even if Indicium’s funds were not distinguishable from other funds, it would still make sense for people to invest in them (alongside a variety of other funds) to minimize counterparty risk, theft, and fraud.
Example: If you invest all of your crypto money in Iconomi and something goes wrong, you lose 100% of your money. So much for diversification and minimizing risk. But invest in 10 different cryptocurrency index funds managed by 10 different groups of people (including Iconomi and Indicium), and if one of them fails, it’s a loss of just 10%. In this nascent space, the rest of your portfolio might be up 80% that year, more than making up for your losses. Even with your 10% loss, you might outperform bitcoin and the vast majority of silly, emotional traders.
But even a 10% loss in a year is a lot. And crypto can’t maintain 80% growth forever. Ideally, you might want to own 100 different funds managed by 100 different groups of reputable people to limit your losses due to counterparty risk to a maximum of 1% of your portfolio at any given time. 1% is basically noise when it comes to crypto. Doesn’t that sound good? If it sounds good to you, it’ll sound good to others. Therefore, there will be demand for at least 100+ funds to coexist. How many are there now? Three? Four? How many crypto index funds are trading on the NASDAQ? 0? How many cryptocurrency index funds do you think that regulators are going to allow to launch on the NASDAQ in the next three years? 0?
Indicium can remain on the cutting edge indefinitely. By the time the Winklevoss ETF finally hits the NASDAQ, Indicium could already have multiple funds holding dozens of cryptocurrencies managed by a group of people that has decades of combined experience in the space and a substantial track record. And in 2-3 years from now, which funds will be the most popular? The ones with 2-3 year track records managed by teams with decades of experience or the ones started in 2020 by people who just showed up? The ones running on blockchain agnostic platforms or the ones tied to a specific blockchain?
We’re headed towards a future where 1) a substantial portion of the money in crypto will be invested in index funds (mirroring the trend in traditional equities markets) 2) the entire market cap of crypto as an asset class reaches into the hundreds of billions of dollars, and 3) Indicium, being one of the most established funds, holds at least 1/100th of the money invested in index funds.
Index funds are the biggest no-brainer in this entire space. It will just take a bit more time for everyone else to realize it.
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