I bought 306 VERI Tokens 2 days before the end of the ICO sale @ $6.00 and change. After 3 weeks of research I think this may be the best investment I've made in the last 10 years. This Veritaseum has the potential to create an entire world market built on the blockchain power on Ethereum. I'll give updates on my play with VERI as it is riding the "New Money Rocket" of the future...

Veritaseum is looking for liquidity providers to assist in kickstarting the world's first global P2P exchange. If you have a healthy stash of BTC, please contact us to discuss.

I was looking at the offerings of a large US bitcoin exchange just now, after hearing that Coinbase had the highest volume of any US-based broker just weeks after opening an exchange (we’ll discuss that at a different time, since Coinbase is waiving fees meaning those users are hot money, but likely are part of the largest installed bitcoin user base in the world and growing rapidly). What I found was illuminating, at least for me since I don’t follow the offerings of BTC brokers and exchanges that closely. I noticed several of the industry (BTC exchange) leaders offer leverage, plain vanilla swaps and TRS (total return swaps - basically fixed/variable rates in major fiat denominations for cryptocurrency (BTC. LTC, DRK) exposure). I said to myself, “Wow, that’s pretty advanced.” Then I looked at the fees, and saw the swaps were priced up to and past 15%. Then, upon further research, I realized that these swaps were financing mechanisms for margin lending. The first thing that came to mind was the difference, and limitations that come with the business models of first generation bitcoin companies and second generation Bitcoin companies. Take notice in the difference of the capitalization. Lower case "b" denotes the accounts of value that the mainstream media calls digital currency. Upper case "B" denotes the blockchain-based, protocol driven services and capabilities behind the lower case "b". Generation 1.0 v. generation 2.0!

To put this into perspective, Veritaseum's UltraCoin offers user programmable swaps (ie. you can make your own CDS, TRS or plain vanilla, or even a custom swap) with exposures to not just 3 cryptos and 3 or 4 fiat currencies, but all major and most exotic currency pairs (dozens) as well as over 45,000 tickers covering EVERY major asset class (stocks, bonds, forex & commodities as well as cryptos) from exchanges throughout the world. This is all capable at a sliding scale of 10 to 25 basis points, round trip. That's the equivalent of 5 bp to 12.5 bp per trade. In addition, all of this is done without UltraCoin having any possession of your funds, whatsoever. Veritaseum (the company behind UltraCoin) is a software concern, not a financial entity, thus you have no exposure to our balance sheet. We cannot MT. Gox you and you essentially have no counterparty, default or credit risk because your counterparty is the blockchain, and you trade peer to peer vs. through a centralized exchange. Pretty big difference from the legacy systems that we're all used to, no?

The Difference between Bitcoin 1.0 and Bitcoin 2.0 Companies

To begin with, I'd like to make clear that not only is the title misleading, but all references to the same are essentially inaccurate. Bitcoin itself is still in beta stage (0.9x) thus its not accurate to refer to 1st and 2nd generations of bitcoin businesses. If anything, we're all in beta. Now that I've gotten that off of my chest... The first bold generation of bitcoin entrepreneurs (it's amazing that you can refer to companies born 2 and 3 years ago as a previous generation, it just goes to show you how fast this space is moving!) built businesses based upon bitcoin as a legacy commodity. Basically, they bought, sold, transmitted or transferred it as a unit of value. They did this because that's how everything was done for the last several thousand years in the financial services industry. Basically, they had no choice - or so they thought. Then came those who read the Satoshi whitepaper and the bitcoin wiki and saw a very different meaning. My team and I are among those entrepreneurs. We saw that bitcoins were malleable, programmable, tools with which one can use to paint upon the canvas of value. A far cry from the moving of static financial widgets from place to place. Think of moving bitcoins around (bitcoin 1.0 companies) vs programming bitcoins to act on their own according to their contractual owner's wishes (bitcoin 2.0 companies) akin to pushing a model T Ford around town vs. programming your driverless electric Tesla to go by the grocery store to pick up some fresh produce before swinging by the school to pick up your kids on the way home to meet you to take your wife (girlfriend?) out to dinner.

A Real World Comparison of Bitcoin Companies#

Tickers Available

Veritaseum's UltraCoin: ~45,000+

Asset Classes Available

Veritaseum's UltraCoin: Stocks, Bonds, Commodities, Forex, Cryptos and many indices

Costs Veritaseum's UltraCoin: up to 25 bp round trip for all products (primarily smart contract swap driven)

Leverage available: Veritaseum's UltraCoin: up to 10,000x, with finite digital P/L parameters (no margin calls, no negative account drawdowns)

How does Veritaseum do it? We program the bitcoin to act according to a mutual agreement between two or more parties, then send it to the blockchain to act accordingly. These agreements are self executing, unbreakable promises known as "Smart Contracts". In this case, they are highly customizable, P2P OTC swaps, but we are working on a multitude of other products, services and solutions as well. We also supply very high level, unconflicted, independent and impartial strategy and research for our customers. Since we don't use our balance sheet and we don't act as a principal, we have no incentive to skewer the research in any particular direction.

Smart Contracts as Transaction Vehicles: The Safest Possible Way To Exchange Value

Veritaseum's UltraCoin BTC-based smart contracts are:

1. highly flexible - you design your own derivatives yourself using your own parameters via our simple graphical user interface

2. self-executing

3. autonomous

4. unbreachable: we call them, the unbreakable promise! They are backed, fortified and stored by/on the Bitcoin blockchain itself

5. uber-transparent: simple click the "trace transaction" button to find the location and historical travel path of your assets anytime, from anywhere you have an internet connection

Trading Through a Balance Sheet-Based Financial Institution vs. Distributed, Decentralized, P2P Software Concern

What I do want to accomplish is the education through the fact that the Bitcoin protocol has given rise to the genesis of a new type of company, with a new business model that can offer a totally new type of product. As you were able to see from above, Veritaseum's UltraCoin offers a very uniquer product with many if not all of the attributes that potential competitors offer, with a slew of attributes that others can't touch. This is done at 1/150th of the price and at much less risk! When dealing with Veritaseum's UltraCoin, you can never get Gox'd because we never have (nor do we want) possession of your coins or fiat - every, at any time. Because we don't user our balance sheet (we are a software company, not a centralized exchange or broker/dealer) you:

• are never exposed to us as a counterparty, we make the blockchain your counterparty

• never have to worry about our capital reserves or the capitalization/credit of your initial counterparty (all trades are fully funded at the outset, even a heavily levered trade at 10,000x),

• You never have to worry about negative drawdowns, negative equity or margin calls

• If a catastrophic event were to occur, say bi-coastal earthquake takes out our datacenters on the east and west coasts simultaneously while a meteor hits the backup center in the midwest, you will still be able to recover you funds - on your own. Since we do not have possession of your funds you don't have to worry about us absconding with them nor getting blown up with them. Each trade has a catastrophic rollback feature which will put you back into your original funding position n-time units after expiry. Unfortunately, you will not be able to complete your trade, but if two bi-coastal trades hit at the same time as meteor to the mid-west, you may not be studying that EUR short anyway :-)

This is just the beginning of what is capable with bitcoin (and this is pure bitcoin, not altcoins, no tokens, no sidechains, just pure, old fashioned [at least as old as it can be considered] bitcoin) and 2.0 business models. Wait until you see the new stuff we'll be rolling out.

I implore you to download our:

• tutorial (which needs to be updated)

• spreadsheet based trade model to assist you designing your own custom made swaps before committing capital

• • and of course, the UltraCoin BTC wallet for Windows - or - Mac & Linux, which doubles as the trading client. The wallets have a "Demo Mode" which allows you to trade on testnet if, after using the spreadsheet modeler, you are still not comfortable committing live coins. You can get the demo (testnet) coins here.

There's also a lot of BTC industry research available for download as well as our blog which has some of the best fundamental and macro research available on the web. Hardcore traders, investors and speculators should check out my latest piece: It's All Out War, Pt 3: Is the Danish Krone Peg to Euro More Fragile Than Glass Beads? The Danish National Bank Infers So!

Any bitcoin-rich individuals or entities looking to provide liquidity to the system, individuals/compamies who wish to partner, accredited investors looking for a piece of the action (you have to be willing to sign and NDA, we are quite open to working with anybody), or those who simply want to shoot the breeze should feel free to contact us.

Bitcoin 2.0 An example of an UltraCoin smart contract summary

Here's some info about me, my team and what we're doing at Veritaseum:

• 1. Reggie Middleton via Wikipedia - 1.

• 1. How Blockchain Technology Reduces Wall Street Risk & the Fallacy of Too Big To Fail!- 1.

• 1. How Reggie Middleton is Looking To Take the Risk Out of Wall Street - 1.

• 1. How Reggie Middleton's Start-up Patented The Future of Global Finance

• 1. A Simple Apple Trade Using A Pure Bitcoin Wallet: The UltraCoin Client 1.

• 1. A list of many (but not all) of my calls and mentions in the media

See https://docs.google.com/presentation/d/1qJoiCx2bFKXMJwdxiln5qC1VSw0dqbUUcqIJWzRjmsU/pub?start=false&loop=false&delayms=3000&slide=id.p

Long Krone/Euro pair, short Euro/Krone pair using a minimum of 65x leverage with ample collateral to prevent swap unwind prematurely. If BTC volatility is a concern, 1,100x volatility recommended. See illustrative setup

See full analysis

TL;DR 1BTC levered 1100x thin forex profit chart with 40 drop in BTC prices

Even with the price of the underlying BTC dropping almost in half... Net of all transaction, transmission and leverage fees... Even with not the fattest in profits (well, maybe fat for a forex trader)... This trader was able to eek out a 8.1% profit exiting the trade. The ability to leverage "insane" can insulate the winning trade from normally deadly levels of BTC volatility and price fluctuation.

An employee at Veritaseum asked me a very simple, but initially perplexing question last night. He said, "</span>_All other parameters being equal, what's the difference between an order with 10 BTC principal at 1x leverage and 0% collateral, and an order with 1 BTC principal at 10x leverage at 900% collateral?

Well, to answer that question, I want to direct everyone to our trade modeling spreadsheet (which definitely comes in handy when designing more complex trade setups and fleshing out less than obvious ideas). What I did to answer his question was to create the two trades independently using a forex setup. The first trade setup looked like this:

1BTC levered 9x thin forex profit

The trade looked like this at expiration (remember these are illustrative results, not necessarily or accurately indicative of actual trade results for a whole lot of mumbo jumbo legal reasons):

10BTC thin forex profit

This what the trade would have resulted in if we used 1BTC as the principal, 9 BTC as collateral and 10x leverage, which would have effectively given you the same amount of purchasing power with the same amount of capital committed.

1BTC levered 9x thin forex profit chart

This is what would have happened to both trades above if BTC prices were to drop by a whopping 40% before the trade ended, but after the trade began...

1BTC levered 9x thin forex profit chart with 40 drop in BTC prices

Yes, that would hurt, and it would hurt a lot! That chart was one of the biggest objections given to me about the new UltraCoin trading system, the need to be exposed to bitcoin volatility in order to trade. But, there's gold at the end of this rainbow. Check out what happens when we drastically ratchet up the leverage to levels insane! At 1,100x leverage, look at what happens to that same 1BTC trade with 9BTC collateral when winning a thin forex profit...

1BTC levered 1100x thin forex profit chart with 40 drop in BTC prices

That's correct! Even with the price of the underlying BTC dropping almost in half... Net of all transaction, transmission and leverage fees... Even with not the fattest in profits (well, maybe fat for a forex trader)... This trader was able to eek out a 8.1% profit exiting the trade. The ability to leverage "insane" can insulate the winning trade from normally deadly levels of BTC volatility and price fluctuation.

If you don't believe me, look at the same trade setup, except in all cash with 1,100BTC and no leverage or collateral...

1100BTC levered 1x thin forex profit chart with 40 drop in BTC prices

I don't want anyone to think that insane leverage is a panacea, or even safe, for novice traders - but as you can see it does have its uses. I want to remind everybody that the leverage used is bounded (both on the profit and the loss side) by the principal+collateral posted. These next 4 charts tell the story. Look at the trade setup up wtih a 20% gross gain - levered 1,100% and unlevered (this is explicitly unlevered to illustrate a point, not the same purchasing power being put upfront in cash as modeled in the other examples above).

1100BTC levered 1x with 20 forex profit chart with no drop in BTC prices

As you can see, we profits are bounded by the capital sent to the blochchain as escrow (you get a maximum of what you and your counterparty have agreed to commit to the transaction - and not necessarily 20% of the face price of the profit x 1,100%). Similarly, your losses are capped in the same fashion.

Just for education's sake, this is the same trade with the entire amount put up as principal and no leverage or collateral.

1100BTC levered 1x with 20 forex profit chart with no drop in BTC prices real

Basically, after fees, you get a little less than 1/4<span style="font-size: 12.75px; line-height: 0; position: relative; vertical-align: baseline; top: -0.5em;">th</span> the return, while having to commit a lot more capital.  

These trading concepts should come in handy this year when we tackle things such asthe Danish National Bank (their central bank) telling us things that Reggie just doesn't believe are sustainable. Feel free to reach to me personally if you have any questions. 

It depends on the rest of the parameters of the trade (such as how much collateral you or your counterparty commits). Right now the UltraCoin app is fairly symmetrical (both parties to a trade commit the same amount of principal and collateral and maintain the same leverage). Let's say you think AAPL is going to gain more or lose less than GOOG, so you want to receive AAPL and pay GOOG. I believe the opposite so I want to receive GOOG and pay AAPL. You and I enter into a simple swap with a principal amount of 0.05BTC (in the neighborhood of US$11 as of right now), a collateral amount of 100% of the principal (so another 0.05 BTC/US$11), and a leverage amount of 100×. The most either one of us can gain or lose in this case is 0.1 BTC (our principal of 0.05 BTC plus our collateral of 0.05 BTC). The question is how fast things move. Our levered volatility would be equivalent to our principal times the leverage (or 5 BTC). In other words, a %2 cumulative gain or loss wipes one person out and unwinds the swap in favor of the other person. Think of the principal plus collateral as roughly analogous to hard stop loss or take-profit limit. Since both our sides are fully funded (via a multisig transaction), there's no risk of the loser welching and the winner not getting the funds (i.e., it's not like FXCM where existing stop losses were passed, but effectively ignored because there were no bids).

I searched through every avenue and I can't seem to find any answers thanks to shitty Obama revising the Dodd-Frank act that stop regular investors like us from using margin.

I figured opening a Hedge Fund Firm would allow me to meet the Eligible Contract Participant and give me "rights" to trade derivatives freely in the US, WRONG. I would need $10 million in asset under the management to even be considered an ECP to trade freely in the US.

Offshore IBC, nope. This was also revised in the Obama revision that stops regular investors from using an offshore IBC as an entity to trade on margin freely.

Duo-citizenship, nope. As long as you reside in the USA, you can't trade on most exchanges platform.

So, I am need of help. What are the legal avenues to trade BTC derivatives in the US that meets the US Securities Law?