Dear Valuable Supporters,
Among the readers of this newsletter are indeed the ones who care the most about KardiaChain. Perhaps you are much earlier than me into Kardia. I want to share my vision and plan to restructure KardiaChain as I take on the role of Chief Executive Advisor.
I'm a classical economist. In my 20-year career, I have always considered technology the critical factor to increasing productivity and, in a sense, the juice to make daily life less boring. It is safe to say that everyone in the financial world knows about the great Adam Smith's "invisible hand" theory. Many expanded theories were born after that, and many economists have won the prestigious Nobel prize since then. Those theories contribute significantly to the grand financial landscape and delve more into the monetary theories. The monetary theories are rooted in the "Theory of Money"; and "The Credit Theory of Money" makes the economic world more colorful. The monetary market has applied these concepts profoundly to create value for all national currencies or fiat money.
Then, a miracle happened in October 2008, when Satoshi Nakamoto published a 900-word whitepaper on Bitcoin, a cryptocurrency based on blockchain technology. Bitcoin has created a whole new crypto economy worth trillions of dollars without any governmental support. Furthermore, it signaled a radical change in business philosophy and application of blockchain technology to create fundamentals for a new "trust." Adam Smith's Store of Value theory now extends more than ever. It no longer depends on any third party or intermediaries. Individual's "worthless interactions" in the traditional sense, when accumulated, can create value. A newly formed community can build trust quickly by exchanging cryptographic information instead of verifying via the banking system. I believe this is a continuation of inheriting and leveraging the economic theory at a higher level, rather than being against them.
Before the advent of Bitcoin, the economy that existed was called the traditional economy. There the accumulation of capital has created empires of hundreds of trillions of dollars. The total assets of the global economy created in 2020 are about five hundred trillion USD, 250 times larger than the Crypto economy. This number continues to grow, and the amount of capital accumulation in traditional finance has created investment institutions at the size of hundreds and trillions of dollars. Finding profitable investment opportunities is true to large financial institutions and a need for people of all ages and countries, as long as they have money. It is also a pressure for investment institutions to continually look for opportunities as long as they have proper standards in risks management.
The evolution of the blockchain and crypto economy has changed drastically. Blockchain platforms have been born and continuously updated, from their starting points as testnets and now mainnets or cross-chain bridges. KardiaChain also faces the challenge of keeping up with technological developments and community needs.
We had carefully researched the development capacity of Kardiachain. The founders of KardiaChain have built a product ecosystem of Blockchain economy with low cost and high applicability in Vietnam, Singapore, and many other countries. KardiaChain has a team of engineers and operators that developed a great community satisfying both Vietnamese and international markets spanned across time zones from the EU, the US, and Vietnam.
The KardiaChain founding members can bring blockchain applications into many fields. Still, the concern is that they are spreading too thin in their approach, making it confusing for the community to identify KardiaChain's strategy. Therefore, we consulted with KardiaChain founders more than eight months ago with multinational law partners on structural consulting to build and accelerate the restructuring plan for KardiarChain.
We will reorganize the KardiaChain corporate system into two main areas: The Application segment and the Chain segment.
Specifically, we will restructure the Application segment into a company focusing on Blockchain Game Development and Applications. The company will operate under the regional structure of intellectual property based on the resources in designing and programming in Vietnam. We will cooperate with all top-notch Vietnamese Game Studios and Game development projects. Our goal is to research and build an efficient cross-game platform to increase economic benefits to become the country-leading company in Blockchain Game under the establishment and command of Mr. Tri Pham, the founder of KardiaChain.
KardiaChain sets goals to continue improving long-term plans towards KAI ecosystem growth via providing blockchain solutions for enterprises. Applying blockchain to different businesses is considered a solid approach to maximizing KAI use cases, optimizing network nodes, and minimizing operating costs. KardiaChain will focus on two primary strategies under Mr. Huy Nguyen's leadership.
The first is the blockchain solution strategy. Accordingly, developing infrastructure-wise solutions to solve business problems, including the development of private chains. The second is the blockchain service development strategy. With specific added benefits, we will complete the chain features in alignment with the community's expectations. The long-term positioning of KardiaChain is to become a cost-effective and practical blockchain solution for Vietnamese businesses.
The restructuring of the business, financial, and systematization of KardiaChain's products and services synchronously will give Kardiachain the ability to accelerate technology and apply higher administration standards.
Professional investors don't expect many revenue streams from an organization. They want a steady stream of revenue from the business' leadership position over the long term. The structure of companies under Kardiachain follows the principle: the company's establishment focuses on leading a sector where the Chairman/CEO has the most advantage in terms of vision, long-term commitment, and short-term execution. These companies also comply with the international legal requirements set out for the blockchain business in different countries.
In terms of financial structure, we adhere to the risk management standards of traditional finance. We will convert our message from the pure profit view of blockchain economics to the profit-at-risk model. This message will allow KardiaChain subsidiaries to access a broader source of capital- not limited to ICO/IEO/IDO or other fundraising approaches of crypto products. Traditional financial investors can access investment opportunities in the blockchain-crypto economy following their risk management standards and investment strategies.
When restructuring the KardiaChain company system, we aim at three transparent investment communities: Traditional finance, The chain strategy (or Kardiachain), The Strategy Application - Game Blockchain.
For the KardiaChain community, this new structure provides KAI token holders a much clearer view of KardiaChain's long-term vision. With the advantage of developing blockchain, KardiaChain is a leading firm in Vietnam that provides comprehensive blockchain solutions for businesses. This approach will help the KardiaChain community, which is mostly overseas, continue to support KAI and put their trust and expectation in the technological development of the chain.
There is also a community looking for short-term profits, or as we call trend-following profits. In this plan, we have a company focused on Blockchain Application and Game Development. That company will develop many exciting GameFi projects such as My Defi Pet, Thetan Arena, or Iron Sail. The opportunity in separating the GameFi segment into a stand-alone business allows optimizations for short and medium-term profits. I believe that the success of a product like Axie Infinity allows the Blockchain Game business to present a hybrid investment structure between the traditional economy and the blockchain economy. Luckily, it can generate a market capitalization ten times higher than a company in the same industry operating in the same period. This number, I believe, is attractive to traditional investors.
We determined that the restructure would make clear the goals and resources for a shared community. Meanwhile, we are fully aware that the risk exists. Some purely profit-driven individuals may find it vague with our declaration classifying into three different directions. Selecting and shifting them from one community to another takes time. However, we can accomplish that by offering adequately attractive products and communicating correctly to each community.
2021 is a particular year for the blockchain-crypto economy. There is no apparent sign of Crypto Winter at the time of writing. Whether "winter" has come or not, we do not dare to comment precisely.
We make sure our team is ready to adapt to any market condition, whether "winter" or "spring." We believe that a strategy to "survive" in any market situation is the first strategy. After that, the "prosper" and "conquer" scenarios are on the table for consideration.
We also expect this change to lay a new foundation for the ever-growing expansion of KardiaChain in both local and international markets. On behalf of the Founders and Leaders at KardiaChain, I express my attitude to beloved KAI supporters who have contributed to the company's success. We are committed to bringing long-term growth value to these economic benefits in the future.
We appreciate all the community feedback and support, wholeheartedly and personally. Our team is always here and listens with a long-term belief in the development of KardiaChain.