Page 11 - May 2018 Disruption Report Flip Book

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Yermack: I think that’s exactly right. You know people have been looking for an alternative source of entrepreneurial finance. Going public through the equity markets is extraordinarily expensive because you have the seven percent commission. You also have the tendency to underprice the shares by 10% and very, very high compliance costs to meet the requirements of the SEC.
I’m not sure that the investment banks are all alone in this. A lot of people have thought that the several rounds of regulation—the Sarbanes-Oxley and Dodd-Frank laws and so forth—they made it so onerous for a firm to list itself publicly. We’ve observed IPOs vastly IPOs--they’ve all but stopped over the last decade in the U.S. And you’re seeing firms like Uber and Airbnb really indefinitely staying off the exchanges, when ordinarily they may have gone public in the last generation.
Galloway: So could Uber offer a coin that says could you have an uber unlimited free rights of this individual and the blockchain just tracks your identity to make sure you’re not abusing it?
Yermack: ...Biometrically with your fingerprint, right.
Galloway: ...because I spend a thousand dollars a month on Uber—$12,000... So a cap
rate of 5—so what is that ...that’s a $250,000 coin, supposedly, right?
Yermack: I would think that a lot of these FinTech companies, especially the ones in the peer-to-peer markets like ride-sharing, might find it very appealing to have their own currency. It’s even suggested that Amazon might put Amazon Coin out there.
Galloway: It sounds like a need to be a Prime Coin because you’d want to directly link to something that you could value wouldn’t you?
Yermack: Yes, but they’ve got all these retail platforms now. ...They were originally a bookstore and now they’ve got Whole Foods and everything in between.
Galloway: What I understand Professor Yermack is if I buy an Amazon Coin and I can’t have ownership I’m getting the rights to the future product. Does that mean I get unlimited everything from Amazon?
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