SEC chairman Jay Clayton urges investors to exercise ‘extreme caution’ around ICOs

America’s chief financial regulator is warning investors against cryptocurrency scams. SEC chairman Jay Clayton released an official statement today urging caution on cryptocurrency and initial coin offerings. “If an opportunity sounds too good to be true,” the statement reads, “or if you are pressured to act quickly, please exercise extreme caution.” Clayton also cautioned that no ICO has been registered with the SEC and that any trading of cryptocurrencies should be done with a considerable amount of care.

Clayton’s comments come as bitcoin is rapidly gaining value, attracting attention from more traders hoping to cash in. On November 29th, bitcoin passed $ 10,000 in value, a more than 933 percent surge from the beginning of the year….

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The Coinbase founder sent a warning to bitcoin investors: ‘Please invest responsibly’

A reminder that investing is risky.

We can’t say we weren’t warned.

A new signpost was added to the crazy financial ride known as bitcoin on Friday when Coinbase, arguably the best-known bitcoin broker on the market, sent a warning message to investors: “Please invest responsibly.”

“We also wanted to remind customers of some of the risks associated with trading digital currency,” Coinbase CEO Brian Armstrong wrote in a blog post. “Digital currencies are volatile and the prices can go up and down.”

Why all the concern? Bitcoin has risen in value faster than almost any other financial instrument we’ve seen. One bitcoin was worth $ 1,000 in January. Yesterday, the price topped $ 17,000, before falling to around $ 15,000 today. That’s unheard of.

All investing in risky, of course, and anyone investing in the stock market should know that prices fluctuate, and things can come crashing down at any moment.

But the fact that Coinbase, a trading platform for cryptocurrencies that just hit the top of the App Store this week, felt compelled to remind people that trading is risky should be a sign that things are moving faster than even the crypto enthusiasts feel comfortable with.

The blog also reminded customers that it’s important to protect their Coinbase account with two-factor authentication, and that trading volumes are so high that there are times Coinbase might not be available due to technical reasons.

“This could result in the inability to buy or sell for periods of time,” the blog reads.

The fact that trading could be unavailable to some users is also a big deal as the price of bitcoin has been fluctuating significantly by the hour this week.

As of Friday morning, a single bitcoin had increased in value by more than $ 5,000 since Monday, a jump of more than 50 percent, according to Coindesk.

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What kind of apps catch the attention of Silicon Valley investors?

Early Snapchat investor Jeremy Liew lays out his criteria.

Creating a well-used consumer app is hard. Not only do people download fewer apps than they used to, but big companies like Facebook and Google dominate the world of consumer apps. Also, once an app looks like it might bring competition, Facebook just buys them — or tries to squash them.

But Lightspeed Venture Partners investor Jeremy Liew doesn’t buy it. The narrative that smaller apps and startups can’t catch fire is a total myth, according to Liew.

“Critics have claimed that growth is impossible in the current environment, but they are wrong,” Liew, the first big investor in Snapchat, wrote in a blog post on Friday. “Apps can still break out through word of mouth. If they have the right product hooks, they can get viral growth.”

Yes, it is Liew’s job to think like this. He’s an investor, and investors are always looking for the next big hit. But Liew will continue putting money on the line, and that means there are still opportunities out there despite Facebook, Google and Snapchat sucking a lot of user time.

So what is Liew looking for? Here’s how he described it using Silicon Valley-speak:

“If your app has hit at least 10k DAU with strong engagement (25%+ DAU/MAU, at least 3 sessions/day), retention (30%+ d30 retention — that’s d30, not month 1) and growth (30%+ month on month growth), I’d like to hear from you!”

Let’s translate.

“If your app has hit at least 10k DAU with strong engagement (25%+ DAU/MAU, at least 3 sessions/day)”

What that means:

Your app doesn’t need to be massive. But at a minimum, Liew is looking for apps with at least 10,000 daily users (DAUs).

On top of that, he wants apps where those daily users represent more than 25 percent of the app’s total monthly users.

So let’s pretend you built an app with 100,000 users who visit every month. Liew would consider “strong engagement” to mean 25,000 of those users visit your app every day.

“Retention (30%+ d30 retention — that’s d30, not month 1)”

What that means:

Liew wants to invest in products where users stick around for at least 30 days. Specifically, Liew is looking for apps where more than 30 percent of the people who joined as a user, also opened the app 30 days after their first visit. Basically, did the app keep someone interested for an entire month?

“Growth (30%+ month on month growth)”

What that means:

Is your total user base growing by at least 30 percent in each consecutive month? If so, Liew is interested.

These are the requirements from just one investor. But you can imagine that most investors in Silicon Valley have similar criteria. So the next time you hear about a hot, new app getting millions from a bunch of Silicon Valley venture capitalists, you’ll have a better idea of what caught their eye.

Recode – All

Too many investors become a “no machine” — here’s how to avoid it

It’s no secret that venture investors hear a lot of pitches. In fact, it is not uncommon for us to see several thousand a year and invest in less than one percent of the startups making them. As you might imagine, we say no — a lot. You may have heard other investors comment that saying no is one of the hardest parts of the job and it’s true. It often seems as though I have to tell great founders with great ideas “no” when I wish I didn’t have to. Yet, over time, it can become such an inherent…

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The Next Web

Recode Daily: A royal coup in Saudi Arabia takes down one of its most high-profile tech investors

Plus, the leaked “Paradise Papers” bring Russian billionaire Yuri Milner’s pre-IPO investments in Facebook and Twitter to light, tech companies still have some ’splainin’ to do, and social media tarot cards.

A gunman killed at least 25 people in a Baptist church near San Antonio, Texas. The suspect has been identified as a 26-year-old Texas man. [The New York Times]

A midnight blitz of arrests ordered by the crown prince of Saudi Arabia ensnared Prince Alwaleed bin Talal, one of the world’s most prominent investors, who holds large stakes in Twitter, Lyft and Apple. With the sweeping arrests, Mohammad bin Salman appears to have established control of the Saudi military, internal security services and national guard. [Theodore Schleifer / Recode]

Russian billionaire Yuri Miller’s big pre-IPO investments in Facebook and Twitter have been tied to the Russian government, according to a leaked trove of confidential documents called the “Paradise Papers.” Milner helms DST Global, which received $ 191 million from the Kremlin-owned VTB Bank — part of which was used to obtain a large stake in Twitter. Reminder: For 2 years, Milner automatically invested in every company that came out of startup factory Y Combinator. In an open letter, Milner argues that he’s being unfairly scrutinized because he’s Russian: “Only a worldview that sees my nationality as inherently suspicious could find such a fairy-tale compelling.” [Johana Bhuiyan / Recode]

Here’s a list of all the questions that Facebook, Google and Twitter told Congress they would get around to answering answer later, after facing hours of tough grilling from Congress last week. And here’s Recode’s expanded list of news organizations that unknowingly cited tweets and information from Russian trolls in their reports. Meanwhile, the Associated Press has a step-by-step investigation into how Russians hacked the Democratic Party and disrupted the U.S. presidential contest. [Bloomberg]

Digital local news is crucial, and readers understand its value, says John Ness, a former editor in chief at DNAinfo, the online neighborhood news operation that was suddenly shut down last week by its billionaire owner Joe Ricketts shortly after its employees voted to unify. Hours after they were laid off, some DNAinfo New York reporters started receiving Venmo payments from their fans; DNAinfo Chicago’s fans donated more than $ 1,000 to the newsroom’s bar tab. [John Ness / Recode]

Softbank’s Masa Son, who is neogiating to buy a stake in Uber, says he may invest in rival Lyft instead. Maybe he means it. Maybe he’s looking for leverage. [Theodore Schleifer / Recode]

Top stories from Recode

Most Amazon Prime subscribers say they don’t want to buy the Amazon Key that lets delivery people into their homes.

But 5 percent of Prime subscribers would definitely buy an Amazon Key.

Uber’s U.S. sales have recovered after the #deleteUber campaign but Lyft is still gaining.

The company is still fighting multiple legal battles and federal investigations.

Facebook may soon test a “red envelope” payments feature, and a new “breaking news” tag for stories.

A few new Facebook features potentially on the way.

Senate Majority Leader Mitch McConnell said tech should cooperate with law enforcement — and help the U.S. fight Russia.

Plus, he appeared to cast some doubt on newly proposed regulation targeting online political ads

Bridgewater Associates founder Ray Dalio has a “magical formula” for better decision making.

On the latest episode of the Recode Decode podcast, Dalio, the chairman of the world’s largest hedge fund, talks about his new book, “Principles: Life and Work.”

This is cool

Social network tarot cards.

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