The Breakdown - Crypto Daily 3@3 - 7.9.19 | Deutsche Bank layoffs; Does Libra drown the BTC narrative? + more

Episode Date: July 10, 2019

Deutsche Bank announces 18k layoffs & a photo instafamous memes a tailor with a Bitcoin bag as a fired banker Strong counter argument against the idea that Libra is somehow good for Bitcoin A new platform for fractionalized art and culture ownership launches  Follow on Twitter @nlw

Going on, everyone, welcome back to another three at three. How's it going? How's it going? It's been a week. It took July 4th off over here in the States. Had a chance to go visit family in Maine where I'm from. The baby got to hang with the grandparents a little bit. It was a good time.

And now we are back and lots and lots of stuff to talk about. So let's dive in. So as a lot of you did, I think I woke up yesterday to this news that Deutsche Bank was laying off something like 18,000 people. So this massive restructuring totally changed the nature of the bank. They're getting out of equities. I saw one of the headlines in a scene reminiscent of the financial crisis, right? So this happened and folks showed up at their jobs on Monday in London and in London. New York to realize that they maybe didn't have jobs anymore. So one of the first things that

happened, though, was this picture came out where if you can see right here, this says Bitcoins, and I'm sure all of you have seen this now. And so like, right, this couldn't be more tailor-made for a meme, right? So I saw Marty posted it early and then Travis posted it, right? I posted Travis's post and said it was iconic, which I think it is, right? This is, in some ways, it's incredibly iconic. Of course, turns out that they weren't actually laid off from Deutsche Bank. These guys just happen to be tailors who are walking by, and it just made for the perfect picture. This is now turned into, I mean, a total meme on its own, right? So you have the company that they're with, that awkward moment when their tailors get mistaken for fired bankers.

you have the guy himself who's now his profile is hashtag Bitcoin bag guy. So it's kind of ridiculous and just more, almost more accurate to the partial absurdity and the upside downness that is crypto. But I think that the reason this makes such a big deal is kind of tweets like this, right? So this is one of the founders of Delphi Digital, who is obviously a prominent kind of analyst, company in the space. When I left the bank last year, I'm sure many of my co-workers thought I was taking too big of a risk going into crypto. I thought they were taking the greater risk by staying. I think that, you know, far be it from me to do too much interpreting of what this means in terms of the global banking infrastructure. But I do think it seems to reflect just the lack of

clarity that all of these banks have about what the future of their business model looks like and what the next couple of years are going to be like and where they fit. I recommend if you guys want to dig in a little bit deeper, there's just great thread by Johannes Borgon that goes really, really deep on exactly what was going on, what the restructuring plan is. Really, really great content. I'll link to it when I share this for you guys later. But for now, let's dive into our next conversation. So Libra, you can't avoid Libra. Next week, we have kind of the congressional discussion. coming up, right? And so Coin Center put out this post basically about what they want policymakers to know about Libra, particularly in the context of Libra versus Bitcoin. And effectively what they're saying is that it's really not a Libra versus Bitcoin conversation, that they represent two totally

different forces in the market. This was echoed, for those of you who didn't see it, last week, David Marcus, who's the project lead at Libra, posted a... a long-form kind of note on Facebook that answered some of the most common questions, critiques, et cetera, about Libra. One of the things that really jumped out to people, which I talked about a little bit in Long Read Sunday this week, was kind of how clearly they were articulating that, yes, Libra was a tool, effectively, it was going to end up being a tool for law enforcement, and that it would make it much easier to kind of track criminal financial activity.

And on the one hand, like, they have to kind of make that argument if they're going to try to play nice with regulators in so many jurisdictions. On the other hand, I think a lot of people were taken aback by just how kind of bald face they put it. And so, you know, I think that what Coinzendor is trying to do is really make it clear just how different these are and kind of let them be judged on their own merits, effectively. Now, simultaneously, this last weekend, I think, maybe on Sunday, Ben Hunt from Epsilon Theory wrote a long piece. This is very different than kind of the analysis we've seen. I think a lot of the folks in the crypto space, and particularly in the Bitcoin world, have settled on this narrative that Libra, if anything, is good for Bitcoin because it

introduces new people to the idea of cryptocurrency. It may get them acquainted with digital wallets and crypto wallets. some number of, some portion of folks who get exposed and start using Libra will then go find their way into Bitcoin, right? Like, this is the logic. And I think there's a lot of merit to that argument. Ben comes from a totally different place. Ben is basically making the argument that this is an example of the power structure reclaiming an insurgent force, co-opting it into something that benefits itself on the back of a narrative that is somehow working. changing or somehow good for the world, right? So the narrative in this case is things like

banked the unbanked and remittances and all this sort of stuff, right? All the things that were at the center of the Libra video when the project launched. And he's basically making the argument that Libra is going, is bad for Bitcoin because it totally co-ops the narrative space. For the vast majority of people in the world, it won't be like, oh, cool, Libra, but what about Bitcoin? It'll just be Libra is the only thing that exists. Now, this is, I think, a really interesting interesting point. I think there's a possibility that he's right. I think that the good news is that it kind of reinforces that it's our job, especially those of us who are in the Bitcoin community, in the larger crypto community right now, to do our own education so that the only context that

people have isn't just Libra, isn't just Facebook, isn't just kind of permission networks, that we help people understand the difference like Coinsiders trying to do. So I thought it was interesting to kind of pair these two together. And with that, we'll go on to one more that I wanted to talk about. So this kind of came up. There's two interesting things that happened or two interesting tweets that I thought kind of fit together. So the first is Josie Bellini who does really, really cool Bitcoin and Crypto Art, really, really awesome stuff. I'll link to her shop as well for those of you who want to check it out. She basically did a version of the Bitcoin's bag that was in that photo and it's for sale. And I thought that was super cool. I'm definitely going to order one.

I think it's really rad, even if it's just kind of a commemoration of this moment. And then, you know, just almost immediately I saw that Michael, who, for those of you don't know, Michael also started Skillshare, Michael Carnge, and has done just a lot of really, really interesting things. So he launched this project called Otis. And this is one I've been watching for a while. And basically the idea of Otis is to allow people to buy into cultural assets. So art, you know, really famous skateboard decks, like whatever, right? Like basically it fractionalizes ownership of culture. And at least that's the pitch. And so it's super, super interesting to me. So let's go to some of the responses. So you had over here, you had product

hunt. Sorry, I do not want your notifications. So product hunt, who kind of like there's really interesting support. So Ryan, who's the founder of Product Hunt, pointed out that there's a couple other folks are doing versions of this, mything markets, focus on magic cards. I actually didn't see this poll. Let's do this right now. Yes, I'm bullish on fractional ownership. I'm not sure if mainstream will care. No way. Or may niche. Although I'm not sure, just so you see. Oh, no, I have to do this. Let's see if this works. This should work. Redirecting you back. So anyways, so I think this is really interesting, 38%. I'm bullish on fractional ownership. So 52%. It's only 25 people, but I still think it's interesting. So there's a bunch that's interesting here in terms of crypto. So I will say first

that this is not a cryptocurrency project. It's not a blockchain project, rather. It looks like the way the mechanism is that they create effectively special purpose companies to buy the pieces of art or peaches of culture, and then owners are kind of, you know, it's all through the SEC, it's all regulated, and you become an actual owner with rights and all that, which I think in a lot of ways is cool when it comes to these real, like, expensive existing offline assets. I think that it matters because a lot of the same things that Michael and Otis are trying to figure out about fractionalized ownership, about whether people care to show off in digital galleries that they have access to some cool piece of culture, whether people even care about

kind of scarce cultural assets in the context of a digital world is pretty fascinating. And I think nudges up against, if not, is directly related to things like First Edition and some of the other kind of interesting NFT-based cryptocurrency digital art projects. So I think it's worth watching from a kind of a consumer behavior standpoint, even if it's not a cryptocurrency project. And, you know, I don't know. It's going to be really interesting to see. I can see a bunch of scenarios.

I can see this being interesting to people, interesting to a small portion of people and that being enough to make it an interesting business strictly from kind of an ROI perspective. You know, part of the reason that people invest in art is not just that it's cool, but that it's scarce, right? It has a proven scarcity. There's no way to kind of imitate originals, I guess,

or at least not holding aside forgeries and things like that. So it could be that from a completely financial standpoint, it works, but it doesn't actually represent any new culture shift. It could also be that this is a really interesting kind of cultural phase ship where in a world where everything is digitized and everything is kind of endlessly commodified through reproduction, that people do actually want that, like, official stamp of approval that they own a piece of something. So, you know, we'll see. It'll be really interesting to see. I'm certainly rooting for it. I think it's really cool. I hope it's at least successful enough that they

get to dig in kind of deep and see what happens. So I haven't seen any questions right now. First day back for the long week, but we will be back tomorrow. And yeah, thanks for hanging out, guys. See you then.