Welcome to the future
This is the first edition of Forward — a fortnightly newsletter that decodes the latest from the world of finance and tech for intelligent minds.
Does the term Holocene ring a bell? No, not the Bon Iver song, but the one described in the riveting Netflix documentary A Life On Our Planet. In short, the term refers to the current geological phase that the Earth is in. A period of over 10,000 years during which the planet has been in a relatively stable state, allowing life to thrive and grow, and humankind to advance to incredible levels without having to worry about ice ages and large scale volcanic eruptions.
In some ways, the past decade has been an economic holocene of sorts. If the 2008 financial crisis was the last financial Ice Age, we have been in a period of bliss where stock markets have delivered stellar returns consistently, and technology-led disruption accelerated progress in multiple traditional industries. That is, until the global tsunami called COVID19 occurred.
That said, businesses have a funny way of turning crisis into opportunity.
The pandemic payoff
Almost exactly four years ago, India was fumbling for cash, literally. After the demonetisation of 500 ($6.79) and 1000 ($13.57) rupee notes by the Indian government — cash, the most popular medium of transaction in the country — was suddenly in short supply. This shakeup paved the way for the Unified Payments Interface (UPI), a digital standard devised by the National Payments Corporation of India (NPCI) to take centre stage. In September this year, India saw 1.8 billion UPI transactions.
COVID19 is spinning a similar story for digital finance across the globe. Brazilian neobank NuBank has seen a 50% increase in the number of open accounts just this year, the number of street hawkers in Singapore accepting digital payments went up by 50% as well, in two months. The share of traditional banks in the global banking and payments industry has steadily been dwindling, down from 96% a decade ago, to 72% today.
Bitcoin bounces back
If you’re in India and have not been tracking Bitcoin since this time in 2017 when everyone from your best friend to least favourite uncle was buying into the rally, we can’t blame you. The Indian Government has not exactly adopted a favourable stance on crypto trading, and speculation is still rife that it will crack down further.
However, that hasn’t stopped the largest cryptocurrency by market capitalisation from going about its business. Backed by favourable sentiments from Paypal distribution, a $50 million investment (1% of total assets) from Jack Dorsey’s Square, and ongoing fiat money printing by global central banks, Bitcoin has snaked back near the $13,000 mark. Say nay if you must, but it’s still too early to write off Bitcoin. Here is an interesting post by Anthony Pompliano — The Investment Case for Bitcoin
An investment in knowledge pays the best interest
- Benjamin Franklin
Stuff we loved this week
Are you even doing Twitter right if you haven’t quote-tweeted Chamath Palihapitiya? He’s on the new episode of the Knowledge Project with Shane Parrish, so get a notepad ready for more gold to share on Twitter.
Running out of conversations to have about the pandemic? Here’s an excellent insight from The Atlantic on how COVID19’s rapid progression is more complicated than single indicators like the oft-quoted R0.
Ray Dalio’s excellent musings on the changing world order are always great reads, but his dive into how China works is among his finest yet.
Our recommendations for your free time
NEO founder and CEO Gaurav Sharma dropped by and served up some glowing praise for Morgan Housel’s The Psychology of Money and Dan Heath’s Upstream. Gaurav’s bookshelf is a treasure trove for finance and productivity nerds, so we usually dive straight into his recommendations.
- From The Psychology of Money
If you haven’t seen A Life On Our Planet or listened to Holocene yet, give them a shot. It’s good to remember that there is still a big, wonderful world out there.
That’s a wrap on our first edition of Forward. We hope you enjoyed reading it. If you did, let us know by subscribing and sharing it with friends.
Take care,
Your friends at NEO