According to Eiteman, Stonehill, & Moffett (2015), interest rates in the U.S. and in Europe are rather low and do not get higher than 1%. Such things might have happened because governments and the Central Banks of the countries had low premium rates in the period of the global financial crisis. They did so because they wanted to keep businesses liquid and enhance management of the accounting. At the time of the recession, investments became more substantial and soon large amounts of money were put into the financial system. False liquidity was injected into the economy and worsened the situation.
The emerging market carrying trade seems to treat as an advantage for the investor not only interest rate arbitrage but also exchange one, reaching combined effect. The number of foreign investments increases greatly as this trade develops rather fast, which streamlines its economic growth. In comparison with it, traditional uncovered interest arbitrage considers only interest rate as its benefit. Moreover, the economy develops in a similar way in the US and Europe. Such a difference can be observed because of this slow growth, which was adversely affected by the financial crisis while countries with new market tend to enhance their performance and move towards prosperity.
A lot of investors are shorting USD and EUR because they believe that they will not be able to overcome the carry trade and will fall soon. In this way, they use shorting as a preventive method that will protect them from losses caused by the depreciation of these currencies. Except for that, they will have a chance to earn some money when USD and EUR fall, which is a great advantage for them.
Reference
Eiteman, D., Stonehill, A., & Moffett, M. (2015). Multinational business finance. Upper Saddle River, NJ: Prentice Hall.
The expected return from individual securities carries some degree of risk. Risk is defined as the standard deviation from the expected return. More dispersion or variability from a securitys return means the security is riskier than one with less dispersion. In simple terms securities carry differing degrees of expected risk that may lead investors to have a notion of holding more than one security at a time, in an attempt to spread risks of the investment. These risks can be grouped as market risk and asset risk. The risk that affects the whole is usually cuts across the industries and does not affect one industry is market risk. While the risk that affects a certain asset is asset risk.Because market risks have market wide effects, they are sometimes called market risks (Fischer and Jordan, 2007).
The procedures used to arrive at the conclusion are laid out step by step. Although some assumptions are made before the final conclusion, but this financial analysis assumes the nature of real-time estimation of any investment which future yields matter a lot.
Combining the Pioneer and the market
Expected return
Holding A Pioneer stock and the market is less risky than holding Pioneer security, is it possible to reduce the risk of a portfolio by incorporating into it a security whose risk is greater than that of any of the investments held initially. Assuming the ratio of holding is 0.01% to 99.99%, then their expected return, risk premium, and standard deviation of the portfolio will be as shown below:
Pioneer
Market
Return (%) Standard deviation (%)
11.0% 32%
12.5% 16%
The portfolio consisting of 0.01% Pioneer and 99.99% the market and the average return of this portfolio can be thought of as the weighted average return of each security in the portfolio; that is:
Rp =
Where:
Rp = expected return to portfolio
Xi = proportion of total portfolio invested in security i
Ri = expected return to security i
N = total number of securities in portfolio
Therefore: Rp = (0.01%)(11%) + (99.99%)(12.5%) = 12.50%
Expected standard deviation
Diversification is meant to reduce risk and the key was not that two provided twice as much diversification as one, but that by investing in securities with negative or low covariance among themselves, we could reduce the risk. This was described by Markowitzs in his efficient diversification theory. The theory states that to reduce risk stocks of less positive correlation should be combined. In general, the lower the correlation of securities in the portfolio, the less risky the portfolio will be. This is true regardless of how risky the stocks of the portfolio are when analysed in isolation. It is not enough to invest in many securities, it is necessary to have the right securities (Gordon, Jeffrey and Sharpe, 2000).
Then the standard deviation will be calculated as follows;
Where:
Ãp = portfolio standard deviation
Xx= percentage of total portfolio value in Pioneer
Xy = percentage of total portfolio value in market
à x = standard deviation of pioneer
Ãy = standard deviation of stock Y
à p =
à p = 16%
Thus, we now have the standard deviation of a portfolio and one is able to see that portfolio risk is sensitive to the proportions of funds devoted to each and the standard deviation of each.
The reduction of risk of a portfolio by blending into it a security whose risk is greater than that of any of the securities held initially suggests that deducing the riskiness of a portfolio simply by knowing the riskiness of individual securities is not possible. It is vital that we also know the interactive risk between securities (Harold, 1999).
The risk of the portfolio is reduced by playing off one set of variations against another. Finding two securities each of which tends to perform well whenever the other does poorly makes more certain a reasonable reruns for the portfolio as a whole, even if one of its components happens to be quite risky.
Risk premium
To allow a risk a business requires a premium that is above an alternative that is risk-free. The more uncertain one is about the future returns, the higher the risk and thus the greater the premium. The risk premium is included in the capital analysis of the business through discount rate. This rate is risk-adjusted because it allows for time and risk preferences. It represents the total of risk-free and risk premium and it reflects the investors attitude towards risk. Risk-adjusted discount rate is thus equal to risk free rate plus the risk premium. In Capital Asset Pricing Model, risk- premium is the difference between market rate of return & risk free rate multiplied by beta of the project. The risk-adjusted discount rate varies the discount rate depending on the degree of risk of investment, a higher rate being applied for riskier projects (Jordan and Miller, 2008).
Risk adjusted discount rate is a method used to assess the relative attractive nature of projects. The capitalization rate of the project is pegged the nature of the cash flow of the system, the discount is directly proportional to the risks involved. This implies, the higher the risk the higher the discount. This is a procedure mostly taught in business school and is among the methods employed to comprehend project risks. The Capital Asset Pricing Model puts it in check. Capital Asset Pricing Model states that there is a linear relationship between the yield required on an asset and the assets contribution to portfolio risk. Therefore the greater the risks involved, the bigger the expected return on the investment.
Rate = risk free rate + (²× (expected return on the market- risk free rate) OR,
r = rf + (² × (rm rf))
rm rf is market risk premium. If the risks associated with a given investments are high then the risk-adjusted discount rates are also high while for less riskier businesses the discounts on premium capital are also lowered since the chances of risks occurring in the business are low. The risk free rate is 5%
r = rf + (² × (rm rf))
12.5% = 5%+ ² × (12.5%-5%)
12.5% = 5%+ ² × (12.5%-5%)
7.5% ² =7.5%
² =1.0
The Sharpe ratio of this investment will be
= Average return of portfolio Risk free rate
Standard deviation of the portfolio
= 12.5% 5% = 0.469
16
Adding pioneer to the market will improve the Sharpe ratio since is less than one.
Combining the Global mining and the market
The average return of this portfolio can be thought of as the weighted average return of each security in the portfolio; that is:
Rp =
Where:
Rp = expected return to portfolio
Xi = proportion of total portfolio invested in security i
Ri = expected return to security i
N = total number of securities in portfolio
Therefore: Rp = (0.75%)(12.9%) + (99.25%)(12.5%) = 12.50%
Expected standard deviation
Then the standard deviation will be calculated as follows;
Where:
Ãp = portfolio standard deviation
Xx= percentage of total portfolio value in Pioneer
Xy = percentage of total portfolio value in market
à x = standard deviation of pioneer
Ãy = standard deviation of stock Y
à p =
à p = 16.03%
Thus, we now have the standard deviation of a portfolio and one is able to see that portfolio risk is sensitive to the proportions of funds devoted to each and the standard deviation of each.
Risk premium
Rate = risk free rate + (²× (expected return on the market- risk free rate) OR,
r = rf + (² × (rm rf))
rm rf is the market risk premium. If the risks associated with a given investments are high then the risk-adjusted discount rates are also high while for less riskier businesses the discounts on premium capital are also lowered since the chances of risks occurring in the business are low. The risk free rate is 5%
r = rf + (² × (rm rf))
12.5% = 5%+ ² × (12.5%-5%)
12.5% = 5%+ ² × (12.5%-5%)
7.5% ² =7.5%
² =1.0
The Sharpe ratio of this investment will be
= Average return of portfolio Risk free rate
Standard deviation of the portfolio
= 12.5% 5% = 0.468
16.03
Adding Global mining to the market will improve the Sharpe ratio since is less than one.
The Sharpe ratio measures the risk premiums of the portfolio where the risk premium is the excess return required by investors for the assumption of risk relative to the total amount of risk in the portfolio. It summarizes the risk and return of a portfolio in a single measure that categorizes the performance of the fund on a risk adjusted in a single measure that categorizes the performance of the fund on a risk adjusted basis. The larger the Sharpe ratio the better portfolio has performed.
Thus A ranked as the better portfolio because its index is higher, despite the fact that portfolio B had a higher return. The Sharpe ratio, which we are about to discuss have yielded very similar results in actual empirical tests.
Recommendation
I will recommend to the investor to buy shares of Global Mining because the standard deviation is lower but it has a higher return than Pioneer Gypsum. The investment in Pioneer Gypsum will generate almost the same rate of return but the standard deviation is high and they are likely to generate a negative return at one point in the portfolio life time.
Wildcat oil
The coal oil mine costs $ 5 million and the analysis is to recommend whether Jones should go ahead with the purchase of the mine. I have been assigned the task of recommending to the company as to whether it should go ahead with the acquisition of the coalmine.
Investment in the wildcat
In order to get the require rate of return for John and Marsha capital asset pricing model will be used as follows;
r = rf + (² × (rm rf))
The risk free rate is provided in this case as 6%, beta is 0.8 and market premium 7%
r = 6%+ (0.8 × 7%)
r = 11.6%
You may determine the optimal sequence of decisions by rolling back the tree from the right-hand side. In other words, first appraise the most distant decisions; namely, the choice of whether or not to switch form regional to national distribution. To do so, determine the mean net present value for wildcat, given that production success and failure. The mean net present value is simply the net present values at the branch tips times the probabilities of occurrence.
They feel that there is a 30-70 chance that the production will be successful. Given an opportunity cost of capital of 11.6 percent. If not successful, they will discontinue the project and the cost of the field will be wasted. The firm is not obliged to enter full production, but it has the option to do so depending on the outcome of the tests. If there is some doubt as to whether the project will take off, expenditure on the pilot operation could help the firm to avoid a costly mistake.
You can probably now think of many other investments that take on added value because of the options they provide to expand in the future. In each of these you are paying out money today to give you the option to invest in real assets at some time in the future. Managers therefore often refer to such options as real option. These options do not show up in the assets that the company lists in its balance sheet, but investors are very aware of their existence. If a company has valuable real options that allow it to invest in profitable future projects, its market value will be higher than the value of its physical assets now in place. We consider the valuation of options.
The decision to terminate a project is usually taken by management, not by nature. Once the project is no longer profitable, the company will cut its losses and exercise its option to abandon the project (Peirson, Brown, Easton, Howard, Pinder and Sean 2000).
Using excel net present value calculator attached the net present value is 4,135,156 and internal rate of return of 28%. The production will continue for four years before starting to break-even.
If the output is known and shipping costs are fixed and all over sudden it changes to variable cost then the net present value will fluctuate from time to time depending on the cost production. in the case of operating leverage the company could be forced to adjust the expected cost of capital.
One must point out that the main difficulty associated with risky investments lies in obtaining cash flow estimates from people, not in the mathematical manipulation of the data obtained. People being what they are, biases invariably creep into the process. Sometimes the incentive compensation of managers is linked to the return on assets relative to some standard. If this standard is based on the expected return for investment projects, managers are likely to bias their estimates downward. In this way they are more likely to be able to exceed the standard. To ensure unbiased cash-flow forecasts, it is essential that the compensation of those doing the forecasting is divorced from subsequent performance(Whitman, 2000).
An individual may make unbiased cash-flow estimates for projects arising in that persons area of responsibility. For some projects, these estimates will prove to be too high, whereas for others they will be too low. However, on average, the estimates are unbiased in the sense that over and underestimates cancel out. But not all projects are accepted. The forecasts are given to a higher level of management, which, in turn, makes the accept-reject decision. Acceptance, of course, depends on a projects likely return relative to its risk. In this regard, there may be a tendency to select projects where costs are underestimated and revenues overestimated. Even though a persons overall estimates are unbiased, this tendency will result in those selected being biased. If this happens, actual returns on accepted investment projects will be lower on average than their projected returns. Decision tree approaches have been advanced for adjusting for this type of bias (Sharpe, 2000).
In the adjustment for biases, one problem faced in any organization is over adjustment. Sam makes a forecast that he regards as unbiased and sends it up through the chain of command for final project approval. Also, there is the problem of accountability. Because capital investment projects involve returns over many years, it is difficult to go back to the person who made the forecast with the actual results. That person often has been transferred or has left the company. While the best approach to correcting biases may be to present a forecaster with the actual results for a number of projects and to compare these results with the forecasts, this often is not possible for long-lived projects (Brealey, Myers and Marcus, 2007).
In addition to the biases described, others also are possible. Although the focus is on the quantitative organization of data, we must be mindful of the fact that the accuracy of the final results depends heavily on behavioural considerations. Every effort must be made to provide an environment conductive to the unbiased forecasting of project cash flows.
Conclusion
The risk in this venture is very high as the net present value shows that the return on capital is higher than the cost of capital. The probability of occurrence of negative outcomes (loss), in this venture is very high.
Reference List
Brealey, R., Myers, S., & Marcus A., 2007. Fundamentals of corporate finance. Sydney: McGraw-Hill.
Fischer, D., & Jordan, R., 2007. Security Analysis and Portfolio Management. New Delhi: Prentice-Hall of India Private Limited.
Gordon, A., Jeffrey, B., & Sharpe, W., 2000. Fundamentals of Investments. New York: Prentice-Hall.
Harold, B., 1999. Corporate financial strategy and decision making to increase shareholder value. Pennsylvania: Frank J. Fabozi Associates.
Jordan, B., & Miller, T., 2008. Fundamentals of Investments Valuation and Management. Boston: McGraw-Hill Irwin.
Peirson, G., Brown, R., Easton, S., Howard, P. & Pinder, S., 2000. Business finance. The McGraw-Hill Companies, Inc, Sydney.
Sharpe, W., 2000. Portfolio Theory and Capital Markets. New York: McGraw-Hill.
Whitman, M., 2000. Value Investing: A Balanced Approach. New York: John Wiley and Sons.
The selected company is Ford Motor Company and the person is the Chief Financial Officer (CFO) of this company in charge of management of international financial operations. As is well known, Ford Motors is a global automobile leader that sells its products in 6 continents. It has nearly 246,000 employees and 95 plants around the globe, The company operates as a globally integrated worldwide team with four key priorities: aggressively restructuring to operate profitably at the current demand and changing mix, accelerating development of new products customers want and value, financing its plan and improving its balance sheet, and working together effectively as a global team. (Ford motor company 2007 annual report, 2008).
Describe the position the international finance manager enjoys in the firm
The man in charge of international finance in Ford Motor Co. is Don Leclair, Executive Vice President and CFO. He has earned $1,005,633 in salary and received incentive bonus award of $3 million. (Ford motor company details 2007 performance and executive compensation in annual report and proxy, 2008).
During the year 2007, his net compensation was to the tune of $11,703,127.
Background of the finance manager
He is an automobile veteran with considerable amount of automating experience in the global market and has been instrumental in leading the financial portfolio, and taking many steps for revitalizing and rejuvenating the financial position of the Company. At 51, he wields tremendous influence inside the company in matters relating to international finance operations of Ford Motors and how it could be bettered and consolidated in the years to come. At a time when most of the American automobile makers, big and small, are struggling with high fuel costs, recessionary markets and massive economic meltdown, it is indeed remarkable that Ford Motors has been able to keep its head above water. When nearly all automakers like Chrysler and GM have opted for Government bailout packages, Ford Motor Company is the only American Auto manufacturer that has not asked for one penny of the bail out money. Instead, Ford Motor Company mortgaged their own assets to get the money that they needed to stay in business. (The great American red, white, and blue oval, 2009).
Financial support provision
The fact that Ford has banked on its own reserves and assets to tide over the international economic crisis speaks volumes of the financial sagacity of its financial manager. Further it is also said that the finance management had arranged for $ 40 Billion in company financing to tide over the present difficult financial situation, enveloping the world automobile industry and American automakers specifically.
How does Finance Manager face international risks in Fords global auto business?
It is seen that from the financial and business point of view, there are three regional segments for Ford products and services. These three main sources are Europe, Asia-Pacific and Latin America. It is seen that as far as business revenue generation is concerned, it is from the European markets. It is further seen that a key role is also being played by FCE Bank, which is responsible for sustaining and generating most of the revenues for Europe and contract volumes. (Investor center company reports, n.d).
Role of FCE Bank in providing growth thrust to Ford Motors
The financial networking of FCE Bank throughout the world is commendable. It has established subsidiary companies in almost all the countries where they do business; besides the UK, it has business associates in Hungary, Poland, Czech Republic. In the UK it is done through the Volvo car financing franchisee and in Germany, it has established subsidiaries to promote its products and services. (Investor center company reports, n.d).
Through its financial organ, FCE, it is seen that Ford is also able to reach out to places where it does not have marketing forays through the provision of financing and fund support to local importers and distributors. At one time, Ford was among the top four global names in automakers, but due to lack of strong global competitive strategy and strong competition especially from Japanese automakers, its position was relegated down the rung of corporate leadership. It is seen that in the Asia-Pacific segment, the markets that are covered by Ford are Australia, Taiwan, Thailand and China. Again coming to the growing and developing Latin American markets, Ford has inroads in the Mexican, Brazilian, Chilean and Argentinean markets. (Investor center company reports, n.d). It also enjoys joint ventures and trade partnerships with many local financial agencies and businessmen in many parts of the globe where Ford is officially unrepresented, through local financing of automobile business and providing financial support to indigenous auto businessmen to promote auto products.
Conclusion
However, now it is believed that with the induction of strong financial leadership and international finance manager, it is possible that Ford may be able to regain its lost glory and position as one of the topmost car manufacturers in the world today.
References
Ford motor company details 2007 performance and executive compensation in annual report and proxy. (2008). Web.
Ford motor company 2007 annual report. (2008). Asiaing.com. Web.
Investor center company reports. (n.d.). Ford Credit. Web.
The great American red, white, and blue oval. (2009). Sporting News. Web.
As cryptocurrency markets can often be volatile, it is essential to keep yourself informed. There are hundreds of websites and probably thousands of articles intended to keep you updated, but what if reading isn’t your strong suit? If that’s the case, YouTube might be the best platform for you to stay updated. Video can be a very successful medium for delivering cryptocurrency news, market strategies, and tools in an entertaining manner. If scrolling through countless websites and articles is starting to make your fingers tired, head over to YouTube and take a look at some of these cryptocurrency channels.
Data Dash
Data Dash is no fluff and pure business. Headed by cryptocurrency trader Nicholas Merten, Data Dash covers all things cryptocurrencies. His Daily Update videos are uploaded every other day, and they cover how various events throughout the week have affected cryptocurrency markets. Dash Cast is similar to a YouTube podcast in which Merten speaks with cryptocurrency experts to get their input on the history of cryptocurrencies, current markets, and where they think they will go in the future. There are over 400 videos, all of which can be used to learn about market trends and get updated on all cryptocurrency news.
Crypto Daily
If you do not have the time to watch Data Dash videos, as they usually hover around 30 minutes to an hour in length, or you just find them a bit dry, Crypto Daily is the channel for you. Crypto Daily features over 300 videos, ranging from news, insights, memes, and even music videos. Videos are uploaded about three or four times a week and usually average around eight minutes in length. Crypto Daily is a late-night talk show about cryptocurrency, successfully blending news and comedy so you don’t fall asleep while you watch.
Superman
Superman is the best channel to go to for reviews. Its host, Michael Suppo, offers a highly-rated course on Udemy, so he definitely knows his stuff. Suppo not only reviews the newest and most popular cryptocurrencies on the market but initial coin offerings (ICOs) as well. He currently has over 390 videos on his channel, which can be used to learn by both new and experienced cryptocurrency investors alike.
Chris Dunn TV
Chris Dunn covers all aspects of investing, not only cryptocurrencies themselves. So, if you’re looking to diversify your portfolio, Chris Dunn TV is the channel to watch. He covers news, investment strategies, cryptocurrency market insights, and much more through his list of over 190 videos. His “Bitcoin Basics” series can be especially helpful for those just getting into cryptocurrencies. Although videos are released every few weeks, each has new information worthy of any cryptocurrency investor’s time.
Box Mining
Box Mining, with over 430 cryptocurrency videos, is the second most extensive channel on this list. Its host, Michael Gu, can be considered a cryptocurrency influencer, as he not only has a YouTube channel but a website, Twitter, Instagram, and Facebook all dedicated to cryptocurrencies. Box Mining covers cryptocurrency news, trends, and strategies and also covers various cryptocurrency conferences.
Doug Polk Crypto
In terms of uploads, out of all the channels on this list, Doug Polk Crypto is probably the most sporadic. Videos are uploaded every few months, but each new video is well worth the wait. Polk’s videos are a perfect blend of quality and comedy. You could consider Doug Polk to be the bad boy of cryptocurrency news. He calls cryptocurrency influencers out when he believes they are wrong. Although comedic, Doug Polk’s Crypto is valuable in that it can help newer investors learn the signs of a cryptocurrency scam.
Cryptocurrency News
If you eat, drink, and breathe cryptocurrency, this channel is for you. It’s a bit dry, but it covers almost every aspect of multiple cryptocurrencies, such as news, updates, and trends. With an astounding 991 videos, with a new one, sometimes even multiple, uploaded daily, this channel will leave you wondering if its host ever leaves his computer.
Crypt0
Crypt0 can be considered the CNN of cryptocurrency. Hosted by Omar Bham, Crypt0 blends talk show and news show. Bham receives no money from ICOs nor any promotional material for crypto tokens, so you know that he can offer his own unbiased opinion on the newest trends.
Which One is Right For You?
All of the channels on this list can be valuable for cryptocurrency investors. If you don’t have the time to sit at a computer scrolling through articles all day, these channels are often a good alternative as they take all the current news and compact it into one video. Do you like staying updated but can’t stay awake long enough to make it through an article? These channels can be both comedic and informative, keeping you equipped with the information necessary to stay at the top of the cryptocurrency market.
References
“Mastering Bitcoin: Unlocking Digital Cryptocurrencies” by Andreas M. Antonopoulos
“The Age of Cryptocurrency: How Bitcoin and Digital Money Are Challenging the Global Economic Order” by Paul Vigna and Michael J. Casey
“Bitcoin: A Peer-to-Peer Electronic Cash System” by Satoshi Nakamoto
After the global financial crisis of 2008/9, the idea of a decentralized currency sprung forth on the backbone of a blockchain-based distributed ledger. As people started to learn how Bitcoin works, interest levels grew as people were tired of the risks involved in leaving our collective financial future in the hands of a small group of regulators and banks.
Over the last decade, the marketplace has exploded with cryptocurrency-based startups with ambitious, forward-thinking entrepreneurs around the world hard at work to craft a financial future free from centralized institutions.
As with any new technology, things are moving fast – and one of the challenges for these new companies is the acquisition and fostering of talent. Cryptocurrency jobs are in high demand, especially talented developers. But how do you ‘train’ talent for an industry and for solutions that are still being formed?
That is the challenge of talent in the cryptocurrency industry, and with growth, strategies for growing the available talent pool will become critical.
Self-Taught Phenomenon
Amazingly, most of the most talented people in blockchain and cryptocurrency startups are self-taught. They have been with this idea from the beginning or joined earlier on in the decade.
Bringing either a vast understanding of financial markets or industries or a talent for programming and logic, these pioneers forged the industry to the point we see it today. While it definitely created some overnight millionaires and even billionaires, it also created an industry that is likely to transform financial markets forever.
Personalities like the enigmatic Satoshi and Ethereum’s Vitalik Buterin have put these open-source ideas out into the public consciousness where talented individuals who believe in the promise of a decentralized future have run with them.
The pool of these self-motivated and self-taught phenomena is running out, and they cannot sustain the industry on their own. New talent will need to come from outside, and there are several ways that will happen.
Supply and Demand
The first way the talent pool will increase is simply demand. The natural law of economics will take over, and the allure of working in high-tech (and due to the low supply of talent) and lucrative industry will drive people to learn and become part of the workforce.
However, there is an inherent lag in this process as workers are trained and become proficient in the skill sets necessary to succeed in the field.
First and foremost, one needs to understand the ‘idea’ or the promise of a blockchain-based and decentralized financial system. As word spreads of the growth of the industry and the size of the markets become too big to ignore, more people will buy in at this level.
Companies are actively recruiting to fill cryptocurrency developer jobs but are finding a very limited talent pool. That pent-up demand will fuel the next spike in talent for the industry.
The next piece of the puzzle is that there needs to be a place for eager young talent to learn the required theoretical and programming skills to become a valuable workforce.
Universities Step Up
As we recently highlighted, institutes of higher learning are reacting to this demand and creating rich blockchain and cryptocurrency-based curricula. In fact, over half of the world’s top 50 universities offer at least one class on the subject.
In addition to offering and growing the number of classes, universities are also creating research bodies to study the industry and better guide their future offerings. Many also share their findings publicly, like the Blockchain at Berkeley program.
They are also hiring a portion of the ‘self-taught phenoms’ to come and teach at their schools, meaning students are learning the theory and design from the very folks who created the industry. It’s hard not to be excited about an industry that is so new that it fosters such a dynamic.
Those who are attending these programs are still going to be pioneers in the field, and one of today’s college students might be the one who cracks the code that lets cryptocurrency leap from a fledgling idea to mainstream adoption.
Online Resources and Open Source
From a programming language perspective, most cryptocurrency uses existing infrastructure and programming language to underpin its systems. That means that savvy programmers are taking advantage of online tools to learn the skills required for cryptocurrency jobs.
Many of the open-source solutions have detailed instructions and tutorials, and dozens of online videos and websites exist that teach programming concepts. Studious programmers can learn how to adapt their current talent to the budding industry and beat the next wave of college graduates that will eventually get there.
Most of the blockchain platforms like Ethereum, Hyperledger, and Corda have online ‘simulators’ or sandboxes where developers can tinker around with code and try to build solutions.
This is where the current pool of talent is coming from, and it will be for the not-too-distant future. One of the biggest philosophies of a decentralized financial system is the open-source nature of its development. The fact that these resources are out there for programmers to take advantage of is a rare occurrence.
Next Talent Steps
As the industry matures and continues to grow, companies and entrepreneurs will have to watch out for people who talk the talk but cannot deliver. A challenge for a ‘new’ industry is that it’s much harder to prove experience or to show a track record. Nobody was working in cryptocurrency 20 years ago; all of the talent is new.
What happens next will potentially shape the future of financial markets and currency globally, so having a rich pool of talent is going to be critical to the success of the industry.
References
“Mastering Bitcoin” by Andreas M. Antonopoulos.
“The Basics of Bitcoins and Blockchains” by Antony Lewis.
Nakamoto, S. (2008). “Bitcoin: A Peer-to-Peer Electronic Cash System.”
Tapscott, D., & Tapscott, A. (2016). “Blockchain revolution: how the technology behind bitcoin is changing money, business, and the world.”
