The Gold Rush of the Blockchain Hackathons

Hackathons and incubators, which were originally reserved for up-and-coming tech entrepreneurs, are now opening their doors to blockchain projects.

Bitcoin and Blockchain fanboy market and the news spy

Of course, the blockchain sector is still in its infancy. Nevertheless, the advent of blockchain hackathons and startup incubators has brought about a major change in the adoption of this technology.

The previous strategy of many Bitcoin companies was the news spy to first address the Bitcoin and Blockchain fanboy market. The hope in this business strategy is to gain enough momentum to be accepted by the mainstream.

Scott Robinson, Vice President of Plug and Play Fintech, Scott Robinson, as the founder of an incubator, has met a number of startups who want to revolutionize existing technologies based on the blockchain. He believes that this strategy will not work:

„Ultimately, the channel through which a novel financial application reaches many customers is through the major players in the financial landscape.

The Accelerator Plug and Play

Entrepreneurs in the Bitcoin and blockchain sectors have recognized these problems. They hope that hackathons, which are often organized by large companies in the financial sector, can be used to build networks with them.

The fact that hackathons are helpful in building such networks has long been recognized by startups in other industries.

The Accelerator Plug and Play helps startups to do this and has been working in this context since 2014 with 96 very young companies, many of which are still in the start-up phase.

However, the work of the Accelerator is also worthwhile for large companies: cooperation with hackathons and incubators helps them to come into contact with a new type of technology without having to make large investments of their own. This also allows their established business to grow.

More and more large companies are taking advantage of this opportunity. Capital One, to give one example, organized a hackathon in San Francisco in July 2015 together with Chain. At this event, 70 employees were flown in to work together with Blockchain experts on blockchain-based solutions.

Hackathons like Capital One’s „bring those who know a lot about finance, but little about the blockchain, together with their counterparts, the blockchain experts without a large financial background,“ says Robinson.

Network effects on a Bitcoin loophole

There are some more or less successful Bitcoin and Blockchain startups that continue to participate in hackathons or have connected accelerators. The Bitfury Group, a company providing blockchain services, has raised $90 million in capital for Bitcoin Mining Services. With this money they were able to set up their own accelerator, the Blockchain Trust Accelerator.

Bitcoin loophole supported by Ernst & Young

Nevertheless, this company joined an Accelerator supported by Ernst & Young. Bitfury received a review for the Bitcoin loophole last week for the best pitch for a digital rights management solution based on the blockchain. This helped her to carry her Blockchain-based solutions to large companies together with Ernst & Young.

„Of course, we are very proud of the result. We have established a good business relationship with senior partners. We quickly understood that such a relationship with Ernst & Young is a good way to offer blockchain solutions to multinational companies,“ said Mark Taverner, Head of Business Development at Bitfury.

Darren Tseng is co-founder and vice president of product at Adjoint, a distributed ledger platform that enables smart contract-based solutions for financial services. He founded his company in June, but continues to participate in hackathons.

„I participate in them for fun and networking,“ said Darren. These hackathons don’t have much to do with his work at Adjoint, but on such hackathons you can find new friends as well as potential developers.

Places of pure creativity

Hackathons are also a good breeding ground for new ideas and potential employees or cooperation partners.

Jeremy Gardner, founder of the Blockchain Education Network and Entrepreneur in Residence at Blockchain Capital, is enthusiastic about hackathons: „This is the best breeding ground for new ideas I have ever known.

„Forcing programmers to get from a sketch sheet to a working demo within 24-72 hours produces a very special, raw form of creativity. You can’t find this kind of creativity anywhere else“.

Gardner has been responsible for the organization of hackathons for several years. Some time ago at the Distributed Health Hackathon he decided to become Saavha Co-Founder and Head of Business Development at the startup. Saavha is a startup who wants to secure appointments with the doctor on the blockchain.

He is of the opinion that programmers and other developers, even if they are already employed in a company or have a running startup, should continue to participate in hackathons. This is the only way to bring them together with new concepts, products and potential cooperation partners.

„The ROI is clear for simple participants, but it can also be helpful for companies to send their programmers to such events.

Marshall Islands Decide Own Crypto Currency „Sovereign“

The government of the Marshall Islands wants to introduce its own crypto currency, the „Sovereign“. This was published this week by the government of the dwarf state via social media. A bill to this effect was passed on Monday, so that the way is now clear for the island currency. After Turkey and Iran, the Pacific state is the third country to respond to the successful launch of Venezuelan Petro by issuing its own currency.

First Petro, soon cryptosoft Sovereign?

The list of countries hoping to issue their own national cryptosoft currency in the future grows by one more member. The sovereign, which means sovereign or ruler in German, is to advance the financial interests of the Marshall Islands in the future like this Is Cryptosoft a Scam? Beware, Read our Review First. A corresponding draft law was passed on Monday, 26 February.

„The purpose of this law is the explanation and publication of a digital decentralized currency on basis of the Blockchain technology as public advertisement of the republic of the Marshall islands“, it says in the bill.

President Heine describes the project

The happy news was spread by the government of the dwarf state, which with only 72,000 inhabitants is one of the smallest countries in the world, via the state Telegram account.

„The fact that we are finally issuing our own currency and using it alongside the US dollar is a historic moment for our people. It is a further step to realize our national freedom“, said President Hilda Heine to Finance Magnates. The Marshall Islands do not have their own national currency. Due to their historical proximity and an association agreement with the USA, only US dollar notes are in circulation here. This is to be changed by the sovereign.

The technology behind the currency is to come from Israel. The start-up Neema wants to use public protocol data in order to keep the concern of criminal use to a minimum. In addition, accounts are to be linked with the government’s identification data, as reported by the Israeli tech news site CTech.

Marshall Islands: tax haven in the South Seas
Similar to Venezuela, the sovereign is to be issued as part of an Initial Coin Offering (ICO). The associated financial injection is likely to be welcomed in the island state. For in addition to declining tourism and a manageable production of tropical fruits, the domestic economy is limping.

„The government of the Marshall Islands will invest the proceeds to advance its efforts against climate change, for green energy, health care as well as towards those affected by the US nuclear tests and education. The sovereign is to be distributed directly to the citizens,

The difficult economic situation in the country is also related to the tax situation. The islands are regarded as tax havens and are blacklisted by the EU Commission. Only the US compensation for the nuclear bomb tests in the region literally keeps the islands threatened by climate change afloat. Every year, the USA sends up to 62.7 million US dollars to the Pacific.

Difficulties with the software

As a general rule, anyone who makes an impression on hackathons can open further doors. Tseng took part in an Ernst & Young Startup Challenge, a six-week program that focused on blockchain applications this year. There he and his team won the award for the company with the „greatest investment potential“.

This is particularly exciting as it is currently still more of an obstacle than a help to be a professional blockchain software developer.

Into the future with Hackathons

„Distributed Ledger technology is still very early in the adoption cycle. Technologies that are very new tend to be less user-friendly and therefore have a higher entry barrier.“

The 18 year old founder of the Blockchain Startup Mesh has six years of experience with the Blockchain at his young age. According to him, Blockchain technology has many strengths, but usability is not one of them.

Since he was twelve, Mate Bitcoin has mined on graphics cards and built several online wallets. In general, he came into contact with computers and programming early on: The computer on which he started mienne Bitcoin was built when he was nine. He played games that were still in the beta phase, debugged them and learned to reproduce the mistakes they had.

But working on video games is easy compared to working on the blockchain: there is no developer toolkit for the blockchain. The infrastructure that would allow a large adoption of the blockchain in the developer scene still needs to be developed.

Some blockchain APIs do exist, but according to him they are not exactly flexible

However, Tseng believes that this will change: The blockchain technology is being accepted by banks and financial institutions like Hyperledger or R3. Just this week Richard Glendal Brown, CTO of R3, wrote a blog post about Corda, the smart contract platform of R3.

The blockchain will continue to take big steps into the future – as it has done since 2008. Blockchain enthusiasts will continue to start businesses and spend their free time on hackathons.

The industry will catch up now that the first links between startups and large companies have been established; according to Mate, this will lead to the „blockchain revolution“ in which these large companies will fully adopt the blockchain. Hackathons are the ideal way to find real use cases.

Hackathons, incubators and accelerators „very quickly show whether an idea makes sense for large companies,“ says Plug and Play’s Robinson.

Dr. Philipp GieseDr. Philipp Giese works as Chief Analyst for BTC-ECHO and specializes in chart analysis and technology. The doctor of physics has many years of professional experience as a technological consultant at his disposal. In addition, he is the central contact person in the BTC-ECHO Discord Channel and, as a speaker and interviewer, maintains an exchange with startups, developers and visionaries.