One Way to Invest Against the Decentralization Wave

“It’s a race between innovators trying to get scale and incumbents trying to get innovation.”

Someone said this to me the other day and I am embarrassed to say that I can’t remember who it was. Sorry.

However, his statement was spot on. (I do remember it was a man).

If you believe that decentralization represents a business model innovation and a new paradigm for organizations, then there is no industry or organization that will emerged unchanged from its arrival.

What will be interesting to watch is whether it is entire industries that are eliminated (e.g. audit firms and title insurance) or if there will be some organizations that adapt and survive across every industry regardless.

I suspect we will see a new type of actuarial table emerge that gives us a “Decentralization Survivability Score/Index/Rating/Coefficient” for companies and organization based on a factors such as:

• willingness to adapt to decentralization
• capability to adapt to decentralization
• and maturity of decentralized competitors

and probably a few others such as marketing sophistication of the innovator since the best product doesn’t always win.

This Moody’s/Standard&Poor’s (before they all got corrupted, I mean) itself will probably be decentralized itself. It may involve a prediction platform such as Gnosis or Augur.

[As an aside, I’ve heard some statements from people that Augur development has really, really slowed, so keep an eye out for that].
In any event, the people who figure that out will do really, really well.

They can go long on the stocks/tokens of the winners and short on the stock/tokens of the losers.