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May 11 · Issue #12 · View online
A weekly summary of the latest news in our world of finance, design, and technology.
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⛺ Woodstock for Capitalists 📉 Interesting interest rates 🤥 Digital identity ⏳ Biometric cards and fintech sandbox ✂️ Bitcoin halving ⛓ Things happen 📖 Monday reading
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Due to several requests, we’re testing out an English version of our Newsletter this week. Let us know what you think by hitting reply!
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Last week Berkshire Hathaway’s held their annual shareholder meeting, often called “Woodstock for Capitalists". It’s a yearly event where usually more than 40k people attend to hear what one of the most successful investors in the world, Warren Buffet, has to say. This year it was held remotely, and you can read a transcript of everything here. Here are 3 key takeaways:
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Whatever happens to the economy it will look obvious in hindsight. If we collapse into years-long depression people will say, “Of course we did. 20 million people lost their jobs in one month. What did you expect?” If we quickly develop a vaccine and optimism returns people will say, “Of course we figured this out. Every pharmaceutical company in the world was focused on defeating one virus. What did you expect?” – Morgan Housel
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“Negative interest rates are the most interesting question in economics. We’re facing a period where we will test whether the world can continue to do this. We are doing things where we don’t know the ultimate outcome.” – Warren Buffet
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The Norwegian startup Zwipe is reporting that they can launch mass production of their debit cards with fingerprint readers in early 2021. They believe “hygiene can become an accelerator and game-changer for biometric payment”. That might be, but as we’ve stated before: why do we need a plastic thing to pay with when we always carry our phone? Apple Pay and Google Pay (and similar) also have biometric payment without carrying a card around. This is like continuing to bet on regular SIM-cards when eSims exists.
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The Bitcoin Halving Explained
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Today, May 11, Bitcoin will experience its third halving. The halving is a 50% decrease in the production of new bitcoins scheduled to happen roughly every 4 years (210 000 blocks). This is in contrast to how central banks react at the moment. Bitcoin is tightening its money supply at the same time central banks are loosening it. Grayscale, the largest digital currency asset manager, has written a report about the timing of this halving.
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One of the most interesting posts I’ve read this week was about signaling: that we think and say we do something for a specific reason, but in reality, there’s a hidden, selfish motive: to show off and increase our social status. This is also related to banks as Julian Lehr writes: Neobanks such as N26 or Revolut reward their premium users with a fancy metal card that doesn’t just look nice but is also noticeably heavier than normal credit cards. There aren’t a lot of other benefits that justify the hefty €17/month price tag these banks charge for their premium tiers – clear evidence that the primary monetization driver is in fact signaling.
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