The Pomp Podcast - #447 Ryan Sekis on Crypto Theses for 2021

Episode Date: December 8, 2020

Ryan Selkis is the founder of Messari, an open data library and curation tool that helps researchers, investors, and regulators make sense of the crypto industry. In this conversation, we discuss Bitcoin, Grayscale, Coinbase, FATF, Ethereum, DeFi, crypto exchange unbundling, and the final boss of the Bitcoin ascension.  ======================= The Rodman Law Group is dedicated to helping entrepreneurs realize their vision by helping them operate defensibly in sectors where laws and regulations haven’t caught up to the realities of the industry. The Rodman Law Group’s legal expertise combined with its understanding of blockchain technology makes it the ideal legal service provider for the industry. http://www.therodmanlawgroup.com/pomp ======================= Harvested Financial makes options incredibly simple. They’re the first options robo advisor, where you can build and customize a personalized trading plan that gets automatically executed. Options help you speculate in capital efficient ways, diversify your holdings with market neutral strategies, and generate passive income by selling premium. https://www.harvestedfinancial.com/pomp ======================= Pomp writes a daily letter to over 90,000 investors about business, technology, and finance. He breaks down complex topics into easy to understand language, while sharing opinions on various aspects of each industry. You can subscribe at https://www.pompletter.com

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Let's kick this thing off. Ryan Selkis is the founder of Masari, an open data library and curation tool that helps researchers, investors, and regulators make sense of the crypto industry. In this conversation, We discuss Bitcoin, Grayscale, Coinbase, FATF, Ethereum, DeFi, crypto exchange unbundling, and the final boss of the Bitcoin ascension. I really enjoyed this conversation with Ryan, and I hope you do as well. Before we get into the episode, though, I want to quickly talk about our sponsors. First up is the Rodman Law Group. You guys got to go check them out. They're

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about business technology and finance. I break down complex topics into easy-to-understand language while sharing my personal opinion on various aspects of each industry. you can subscribe at pompletter.com. Again, pompletter.com. All right, let's get into this episode with Ryan. I hope you guys enjoy this one. only as an expression of his opinion. This podcast is for informational purposes only.

All right, guys. Bang, bang. I have a treat for you today. I've got Ryan Selkis. He decided to sit down like a psychopath and write a 120-page report all about Bitcoin, Ether, crypto, and God knows what else is in this thing. So he's here to talk about it. Thank you so much for doing this, man. You know, it's been a couple of years since we last caught up back when you were a wee lad, we did one of the early podcasts. Uh, and it's, uh, it's, it's good to, uh, to do this again. Absolutely. I was actually at the Nader last time. Right. So we're like, now we're moving on up in the world. Cause I think we caught up around 4,000, like the worst part of the bear market in 2018. And now we're back on top. Absolutely. Let's start just with a quick overview of,

your background and what Masari does. Sure. So I've been in the industry for about seven and a half years, almost exclusively on the information side of things. So as an independent research analyst, then as a seed investor at Digital Currency Group, one of the most prolific investors in space. DCG is structured as a holding company. So we acquired CoinDesk in 2016. I led that restructuring for about 18 months, got the business to profitability, ran the Consensus Conference franchise, which some of your listeners may have attended. And then in late 2017, early 2018, I started Masari. And back then, this was basically the height of the last bull market.

And our thesis, my co-founder Dan and I, our thesis was this ICO boom is a load of crap, but there's a kernel of really interesting tokens and really interesting assets that we think are going to be big in a decade. So let's build a company that's going to, yes, satisfy the shorthand for Bloomberg of crypto, assuming that this does become a bona fide asset class and it's not just about Bitcoin, Ether, and then all these also RANDs that ultimately wash out in the next cycle. And of course, that happened, right? The market corrected. A lot of the crappy projects went to zero. But the teams that kept building, sure enough, were more often than not able to find product market fit, maybe with different applications, not necessarily the assets.

But that ultimately led to some innovations around, okay, how can we decentralize the economics of this killer app that we've built and actually create financial economics around it so that it's interesting and compelling to actually own a stake in these decentralized networks? And that's basically the concept of these decentralized finance assets that we'll talk about a little bit and some of the Web3 tokens and what are now called non-fungible tokens. But if you add it all up, we've basically got this explosion of interesting financial assets that didn't exist three years ago. Bitcoin is 12 years old, but many of these assets beyond Bitcoin just simply did not exist even as early as recently as three years ago, which is when we started the company. And so our starting point was to build out a research library that was focused on disclosures and more qualitative information, right? You know, models are only useful as their inputs, right? So getting quantitative data out of these projects and trying to make models or trying to make sense of whether they're going to be at all interesting was a fool's errand. And instead, we focused on things like, okay, who are the stakeholders? What are the proposed economics and design of the system and kind of the use cases of these protocols? And maybe, you know, yes, their assets as well. What, you know, if they got in security audits, if they, you know, are they adequately represented by counsel? Where are they located? You know, all the things that would essentially be in a prospectus outside of the financial statement.

So we aggregated all of that. We've worked with close to 100 teams now on the project side. And on the enterprise side, we work with dozens of the top exchanges, custodians, investment funds on a subscription research product that looks like the Bloomberg terminal bit. And then a corporate actions alerts and monitoring system called Intel that basically helps people come up and stay up to date on all these non-quantitative updates that are happening, whether it's governance proposals, hard forks, security issues, software releases, and the like. So it's a pretty comprehensive enterprise suite that's built right now for crypto professionals, crypto funds, and enterprise companies. Um, but, uh, ultimately we think in the next cycle, you know, going to, going to obviously be a massive, uh, customer set for us. So you rate this report. I think this is year four that you wrote this report. Uh, literally it is 120 pages, which, uh, most people would say that is absurd. Why do you need 120 pages? Uh, I've read almost all of it. Uh, I sat down, I thought it was going to be like 20 pages and realize 120 takes a little bit longer. Um, and I thought it

was actually really concise in terms of it just covers so much material um and so maybe just talk through like why write the report why sit down i think you actually wrote it like it's not you like hired outside team to do it but why sit down and write this well i mean first of all i have a couple of advantages right one i've i've i've written prolifically for a long time so it's a little bit faster for me to do uh second of all uh our team produces so much terrific content on a database and through our pro product, but I was able to, you know, not only absorb that over the course of the year, but, and really stay up to speed on things, but also borrow, um, some of their graphics, some of, you know, their, their kind of better witticisms, you know, through

throughout the report. Um, so it's all original and, um, uh, you know, I, I did spend some time doing it, but, uh, you know, you stand on the shoulders of giants, you know, so to speak, uh, first of all. And second of all, I think about this report as kind of our guiding document for the year ahead. So it kind of doubles as a strategy session for where, you know, we're thinking about the industry, where we're thinking about taking the company in the year ahead. And to your point, it is shockingly, I think, concise, right? And I even call that out in the introduction. You look at something like this, and I think you'd expect, you know, drivel and filler and, you know, words for the sake of words.

But the truth of the matter is it's broken up into 12 sections. There's a section on Bitcoin. There's a section on Ethereum. There's a section on decentralized finance. There's a section on infrastructure trends. So they're all kind of like, you know, 10-page reports amalgamated together into this kind of giant year-end piece. And that's more of a function for just how fast the industry is growing, right?

When I, when I first wrote, um, the original, it was, I think January 1st or second, you know, 2018, and it was literally a medium post, right? Uh, and then the next year, uh, one of my friends in the industry is now an investor at Paradigm, uh, Arjun, uh, actually shotgun me and he wrote his a few days before I was supposed to publish mine and his was so much better than what I was going to publish. So he just like totally ate my lunch and, uh, and I was, I was, I was so, you know, uh, crestfallen about it and just like, you know, I just waste so much time, but, um, it, uh, kind of led to actually, you know, creating this as, as a, uh, a year to year repetitive product that

we were going to put out, um, because, you know, we kind of find it so valuable, not only in, you know, framing our own product roadmap, but helping people come up to speed on what's going on. You know, the, the problem I think is it's, um, with, with information businesses in general in the industry you always have to keep in mind that there's someone starting at home plate right you know we're like rounding second you know the industry is is still early um so i don't think anyone's rounding third or kind of close to the the finish line here nor will they ever be but um it's it's even more challenging as more complexity gets added on as more sectors get added on to remember that like, and you have done a masterful job at this. Remember that people are like getting

out of the batter's box and they're asking like, okay, what's Bitcoin? Like they've heard of it now, I think, right? You know, most people can give you maybe a one or two liner, but they haven't studied it, right? So when that's your starting point, and then you try to get into, well, you know, there was some hacks this year that weren't really hacks, but they were basically just combinations of these you know exploits of oracle infrastructure using flash loans people are like what the fuck are you talking about so um you know we we try our best to to put it in in plain english for folks that are trying to come up to speed absolutely so we're going to go through a couple of the topics that are in the piece but i highly recommend everyone go actually read it

uh the first is uh let's start with the king bitcoin uh you basically give a bitcoin outlook for 2021. How do you synthesize that down in terms of what do you think happens next year? Yeah. Look, I think that the bull and bear case, just the cliff notes, we tried to lay out pretty clearly. It's become a macro narrative story for most investors. And the easiest way to think about Bitcoin is as digital gold. I think that narrative fits. It works. It's not perfect, but it's pretty good. And that's the one that the institutional investors have really rallied around. Beyond that, and beyond kind of the macro environment where there's, you know, unprecedented levels of negative yield, yielding debt, and unprecedented levels of money printing

and debt modernization, you've also got the fact that smart money investors knew about Bitcoin back in 2017. They saw the spike. It was very, very public. It was very loud. And then it died in 2018 and now it's resurged all the way back. And I think a lot of them have appreciation for things that don't die when, when they really should, because it makes you take a step back and actually think, what did I miss the first time around? Um, you know, yeah, so probably too early to invest in 2017, but now there's three years more infrastructure. There's three years more of a Lindy effect around this asset because it has proven staying power, not just for me and my experience looking at it from 2017, but it's done this in 2011, 2013, 2017, and now again today.

So I think from a bull standpoint, first of all, most investors are copycats. So there's a lot of really good investors, some of whom you've had on your podcast, that have made it safe for people in institutional investments to actually make an allocation here. Remember, these aren't people betting a farm. It's half a percent, 1%, maybe a couple of percentage points. I would say that when Druckenmiller and Bill Miller and Raoul Pal and some of these others that are widely followed in financial circles talk about making significant investments in Bitcoin, it has the same impact that Mark Andreessen and Fred Wilson had on the venture capital side back in 2013. And that's obviously pretty powerful. Now, and I think we'll probably end here or talk a little

bit more about this later, but the bear case is because it's so big now, and because you've got all these high profile people talking about it as a macro hedge, it's on everybody's radar in DC, it's on everybody's radar in Beijing and kind of everywhere in between. So there's going to be a lot of questions this year over, um, the true essence of Bitcoin and crypto and, and kind of how it fits, uh, how do you reconcile the, uh, truly peer to peer unregulated kind of wild west aspects of it, um, to the reality that for the most part, this next rally is, is actually finally going to be led by institutions and, you know, heavily regulated entities. And so when you think through that. There's kind of three key pieces that you talked about in the piece. So one is

this Grayscale ETF, two is Coinbase going public, and then three is kind of FATFA or privacy type concerns. Let's start with Grayscale's ETF. Those that are listening may say, wait a second, Grayscale doesn't have an ETF. Grayscale has a trust structure. Talk through why do you refer to the ETF? So I call them side door ETFs. And this is basically a function of the SEC's unwillingness to approve an ETF based on their sense that price discovery is really taking place in the East versus in properly surveilled markets in the West. And what Grayscale was able to do and kind of very cleverly took advantage of early on was rule 144 sales of restricted securities. So basically, you could have this private trust as a closed-end vehicle. People could invest in

at a daily NAV, just like you would in an ETF, but they'd ultimately be restricted for 12 months. Now it's down to six months for a couple of grayscales trusts, but 12 months for the rest of the family, six months for Bitcoin. And essentially they, because of that dynamic, have a massive premium on the public GBTC shares that are unrestricted versus what investors have been able to capitalize on going directly to Grayscale based on their accreditation. And what has really kind of put this in hyperdrive is the emergence of credit markets and the ability for people to actually create shares in Grayscale on credit. In some cases, they can pledge the Grayscale shares as the underlying collateral. And in that case,

you're basically just clipping coupons on premium, which is the spread between what you'll get in six months. You know, typically that's around 20 to 30% for Bitcoin and the GBTC shares. It's up to 60% now for the Ethereum trust between, you know, what the underlying spot value is and what the public unrestricted share price is. And what that's really a function of is the fact that you can't, the redemption process is extremely inefficient versus an ETF, which where this process would happen daily. Now it's constrained by the six month lockup. So you've got a significant supply demand imbalance in public markets. I think the most surprising thing maybe for many people is that this premium has not gone away. And in some cases it's stayed very high over time.

And in fact, you'd expect this to actually trade at a discount because Grayscale takes a 2% fee per year. That hasn't been the case. And for as long as it's not the case, you know, Grayscale is going to ramp considerably. And it's going to be a hell of a trade for institutional investors that are getting into the industry. It looks like free money to them in many cases because they can do this with leverage. So I'd say that has been a major driving factor. And in fact, Grayscale has acquired a significant chunk of the Bitcoin that's been mined this year, if you look at it that way. Yeah, I think they own something like around 2.5% of the circulating supply of Bitcoin from what I've read.

Let's talk a little bit about Coinbase, a different business, but obviously still a piece of infrastructure. They have plans to go public, it sounds like, based on kind of public media reports. What's the importance of that or the significance? Well, Coinbase is kind of the OG in the Western markets. They have been the highest profile brand, I'd argue, in crypto basically since day one, or at least since it came into the public consciousness in 2013. And what Coinbase has done phenomenally well kind of ties back to an early decision they made to not throw the baby out with the bathwater once other competitors emerged. And that is keeping their 1% fee as a retail brokerage

versus trying to immediately respond to lower fee competitors that followed soon after. So if you remember Circle, Circle basically came out with a competitive product to Coinbase called 2014. And they said, we're not going to charge a 1% fee. It's going to be zero fee uh, trading to, to enter and exit these, these Bitcoin positions. And then they would just kind of make money on the spread or on the OTC desk in the backend. Um, Coinbase never did that. And they, so they have basically bifurcated their product between the retail front end that, that kind of the first time buyer knows and uses, um, which also includes a very rock solid, uh, custody products by extension. And so it's kind of like the one place that most investors can go

buy their Bitcoin, forget about it and keep it safe. And then at the same time, they have Coinbase Pro, which is one of the more liquid exchanges, a much more competitive business, much tighter fees, much tighter spreads, that kind of a traditional trading set can actually leverage. But I would say what has really separated Coinbase is their approach to regulators in the U S and Europe in particular, and how, um, thoughtfully have been, uh, in that multi-year process of getting regulators comfortable with their business. Um, and then, uh, it's kind of the, the, just the blue chip brand that they have for security and, and, um, and, and safety, right. Um, for newcomers into the space that want price exposure, don't necessarily, you know,

want to actually play around with some of the more exotic applications got it and then all this leads to kind of a positive sentiment there's lots of kind of big um infrastructure being built there all the trends are pointing in the right direction and then we get to something like fatfa and these privacy uh type concerns explain those um so the um it's a financial action task force uh i don't know if it's fat for fat f uh i've always said fat f that might be wrong i'll ask the Coin Center guys. But the gist is that any regulated money transmitter needs to know their customer and they need to abide by certain anti-money laundering provisions and basically the same things that other regulated financial players have to abide by. Crypto introduces some

unique challenges with something called the travel rule, where the FATF standards have gotten more onerous and potentially more restrictive on exchanges' ability to allow their customers to send crypto to wherever they may choose. So it's one thing to know the source of funds and to file these reports. It's quite another to actually actively block exchanges and other regulated entities from allowing you or I to move money from our Coinbase wallet into a self custody wallet, like a hardware wallet, or to send it to a smart contract or to send it peer to peer to someone that is not necessarily known. And basically FATF regulations would require that there's some knowledge or some tracking of who those funds

are actually getting sent to. If you take this to the extreme, what that could mean is that there's a gradual march towards outlawing self-custody and truly encrypted private peer-to-peer cash-like transfers. This is important because at the end of the day, Bitcoin is supposed to be this large interoperable network, not just about the anarchist roots, but even if you just think about it from a tech standpoint. It's supposed to be this interoperable global standard. And the second that you start introducing some of these extra requirements or restrictions, in the worst case, you can break the fungibility of the asset itself, which basically means that you've bifurcated the network into like clean coins and dirty coins, even if they're not actually dirty, right? Just

like these are the whitelists of coins and these are ultimately the bad coins. And so this has been of concerned for a while. And it's one of the reasons that maybe the most important core developments that are being worked on by the Bitcoin community are around privacy and how to make it less likely that we'll have this two-tiered system where coins can be tainted just because they've originated from a certain source. Yeah. And what's so interesting to me about this is there's always the fear and the FUD, if you will, that everyone talks about. versus what's actually going on. Sometimes it's literally nothing's going on, but everyone fears something. Sometimes there's a lot going on and nobody fears it. This kind of feels like it's

actually somewhere in between that is somewhat rational in terms of something to pay attention to. We're going to talk about Ether and Ethereum. That is probably the most controversial thing that comes up on this podcast. You just start wherever you want. There's a big section in the report on it? Um, kind of, how do you look at that asset and that network, uh, in terms of where it's grown to today? And then how do you look about it going into 2021? Well, first of all, have you been red pilled yet? What's your current style? I'm not sure where you are in your evolution on Ethereum. So I don't know if I need to red pill you or, or like where we're standing today. So like, let me, let me hear from you first and then we'll, we'll, we'll, we'll talk about it.

Listen, I hold no ether. Uh, we can talk about why that is. Um, we have invested in a number of businesses that, uh, build on top of the Ethereum network, uh, for a variety of different things. Um, we also have invested in a number of DeFi companies that are building on top of Bitcoin instead of ether, uh, or Ethereum. Uh, and then obviously everyone knows that I've been super bullish about, uh, digital art and kind of, uh, how that's playing out. And so I always put myself in like, everyone wants to like label me some maximalist and all stuff. Like I'm actually just like pretty rational. Uh, and the concerns that I have, um, usually aren't things that people think are ridiculous. Uh, and also when they think about from a portfolio construction

standpoint, uh, I usually lay out an argument that makes the people who hold ether look good, uh, which is unique. Uh, but I don't hold any myself and, uh, and so we can get into all that, but that's kind of where I am is don't hold any ether, but, uh, uh, have kind of done probably more than most of the trolls on Twitter in terms of, uh, you know, doing things around the Ethereum network. Uh, just, you know, we'll see how it plays out. So, uh, the one thing I will say is I think you have time, right. Uh, and I'll get into why that is in a second, but I do think that, uh, ether is probably the only other assets that you, you probably need to hold as a crypto investor. If you're thinking about making a long-term bet on the industry. Um, there's a

few reasons for this. One, Bitcoin has absolutely won hands down when it comes to just the virality of the asset. Bitcoin is a shelling point, is a new form of digital gold, but they are getting further and further behind. The network is getting further and further behind in terms of being useful for additional applications. There is some that's going on. I know you've invested in companies that are working on this. But in my eyes, Ethereum has become the settlement layer for all crypto applications, not named store value Bitcoin. You have seen this with the explosion of stablecoins and the close to a trillion dollars in volume that will be processed on Ethereum, which is actually more than Bitcoin this year. You've seen this with the explosion

of applications. Again, almost all of which should have any meaningful value and volume are sitting on top of Ethereum. It has, I think, at least an order, probably orders of magnitude advantage when it comes to human capital and developer mindshare. And the clincher, and this is why I say you have time, is that Ethereum is going to be probably more risky than Bitcoin for the next couple of years, because it's got this very convoluted network upgrade that the entire ecosystem needs to get through. They just got through the first milestone, which is important. But if Ether, if Ethereum is able to make it through this upgrade called Ethereum 2.0, It will arguably be less risky than Bitcoin is in terms of its security assumptions, right?

So that's a loaded issue that we can get into. But what Ethereum really needs to de-risk is whether its network is secure at scale using this consensus mechanism called proof of stake. The reason that they may have an advantage is they have a perpetual issuance model that Bitcoiners hate because it's unclear whether there will be a fixed supply in the future, but it's very, very low. And you might argue that it is better to have 1% inflation in a protocol like this just to serve as rewards for the maintainers of that network, the validators of that network. Whereas in a couple of years, Bitcoin is going to drop well below 1%. And it's

very unclear at this point whether the fee market in Bitcoin is going to be sufficient to actually protect transactions. In addition, you've got the issue that 70% of hashing capacity and a good chunk of the network's power is actually being driven out of China, which we could have a full episode conversation. I know you've probably had better guests on that can, that can talk to the pros and cons of that. But it's, um, it's probably less of a technical issue. It's more of a geopolitical issue at this point. Um, and I think Ethereum gets away from that. So, um, those are, are kind of the basics, but I will call out that there's, um, there's maybe a little bit of like a tail wagging the dog element here as well.

I think in 2021 professional, like institutional investors are going to look at the grayscale ETH product and they're going to look at that premium and they're going to salivate and they're going to say, you know what, maybe I don't love this versus Bitcoin, but this seems like a pretty good risk adjusted return for my money for holding six months if this premium can stay anywhere close to what it is. So if Ethereum just trades in its consistent historical range with Bitcoin, then, um, you know, you should be able to, you know, print premium, uh, over the course of a couple of consecutive six month periods. So that's netting out the impacts of taxes and everything like that. But you combine all those things and, um, and you're able to pull through

some demand on the institutional side, which, you know, can, can kickstart an institutional narrative to begin with. And I think over the course of the next couple of years, that could basically have Ethereum in the conversation credibly, very seriously, um, as, um, as an alternative to Bitcoin. I'm not saying that my portfolio is balanced that way either, but I do. What do you have? What's your portfolio construction? So my portfolio is probably 70% Bitcoin at this point, about 10% Zcash, and then 20% split between Ethereum and decentralized finance applications. I tend to invest more in the DeFi applications because they are producing real network fees at this point.

And my sense is that if Ethereum does well, it's because DeFi is doing well. So I'd rather take the higher beta. But I think if I were to move money, it would not be from DeFi to ETH. It'd probably be from Bitcoin to Ethereum over time to get into that balance. So I'm probably slightly underweight Ethereum

versus where I would be if I was just looking at the market cap weightings. All right, hold on, time out. I've come back in. so so here's my general uh sense of all of this right is there's two different stories i think you see it the same way kind of what i've heard you see say and also uh right which is the argument that bitcoin is money and store value and one day can grow into a medium of exchange and stable value etc i think you're right is like that pretty much has taken hold both from a uh data

standpoint and kind of the metrics of the market but also to that narrative is uh maybe not completely uh embraced by the institutional world but definitely getting there right when you see um you know stanley drachenmiller or paul tudor jones or uh you know now jp morgan city bank all these people are talking about it in terms of hey it's a settlement network uh similar to a paypal venmo whatever what i think the biggest turnoff to me has always been is you know there's the whole defy crowd running around saying eth is money for example and so when i was reading your report you specifically have a section that says eth is not money uh so we can talk about that in a second but i think part of what we're starting to see is uh there is activity for sure the

question is how much of the activity is innovation versus just continued repurposing of the ico nonsense and kind of all that and i think actually like there's a mixture right it's not 100 all innovation it's not 100 all kind of the nonsense either um and one of the areas that to me like just blew me away when i saw what was happening in terms of people yelling and screaming saying like eth is going to take over the world was with all the yield farming stuff like when you really look at like what was happening right is basically people were creating tokens and they were just dumping those tokens on uh retail investors and some were like outright i am like kind of rug pull on you um but very very different uh models and so for me it was like it's almost

like developers learned about financial engineering like that like essentially what was going on right and that's not to say it's a bad thing like there's a lot of financial engineering that goes on the traditional uh markets that um you know it's very valuable for all kinds of reasons but i think that the reason why i bring that up is bitcoin is telling a monetary story it's telling a store of value a money story a macroeconomic story that tends to be very clear concise and either you believe it or you don't right and so if you're an institutional investor here's the argument here's what's going on macro environment either you think this is going to happen or not two three years ago nobody thought it now i think it's it's going from kind of a contrarian trade

to a consensus trade. But ETH is telling a different story. It's not telling a monetary story. It's telling an innovation story, right? So basically, it looks much more like a early stage technology investment. And when you get into that innovation story, the part to me that I think people are confusing, right, is there's really three groups of individuals or organizations that are going to look at the asset. So you got retail, right? Plenty of retail investors on Bitcoin, plenty on ETH, and plenty on the long tail of whatever else is in there. Then you've got what I'll call traders. These can be both Wall Street and traditional traders or the crypto traders. Things like that arbitrage trade with the ETH grayscale trust, they're going to exploit

whatever they can. It's kind of numbers on the screen to them. They actually don't really care a lot of times what the underlying asset is. They just want to make money. They're pure capitalists and they're trading on a screen. There's a third group though, which is what I'll call investors. They're not traders and they're not retail and they're looking much more long-term. I think that the obstacle that is in front of Ethereum and ETH, which doesn't mean that you can't overcome the obstacle, it's just a much bigger obstacle than let's say the Bitcoin community has at this point, is you basically have to tell a story that is we're going to decentralize and disrupt the entire financial system. And five years ago, nobody believed that.

Right. Like DeFi wasn't even really a part of the conversation. Like it was all about, you know, this capital formation and ICOs and all that. There's now some people who believe that. Right. And whether it's venture capitalists or even some people on Wall Street that are starting to believe that. But I think that where we don't know yet is there's still a whole bucket of unknowns and uncertainties around what does that world look like? Right. And is it literally, you know, and I say this in a loving, positive way, but is it literally 20-year-olds, right, who create decentralized applications and then throw it out in the world and they're just like, hey, whatever happens, happens. Like some people are like, that's awesome, that like long innovation and let's go disrupt the world. Other people are like, that is the scariest thing I've ever heard in my life, right? And so I think that that's the part where there's just a big disconnect between like what's happening and all the activity and really like how what I'll call quote unquote professional investors are viewing the space. And I think what you're arguing, and this is where I'll shut up and you can kind of explain, is if those uncertainties or unknowns get more clarity, then that's where there's like this great wall of money almost that you think will kind of flow into the space and people will have much more comfort. similar to what kind of has happened to Bitcoin over the last, I don't know, three, four years, that basically potentially could happen with ETH, but there's some work to be done before that. Is

that generally accurate or am I way off? Well, I think it's accurate, but I think you answered your own question. In some cases, Ethereum went live as a network, just Ethereum, the smart contract platform, about five and a half years ago now versus 12 for Bitcoin. And let's give, you know, Bitcoin, let's say Ethereum should be a little bit accelerated because it has the benefit of kind of, you know, riding off of Bitcoin's, you know, coattails in terms of, you know, red pilling people with the concept that a network like this could exist. It's still only been, you know, five and a half years from the very, very basic network launch and only a few years since some of the application providers really had the infrastructure upon which to even start building. Right. So, um, I do want to talk about yield farming in particular, because I think it highlights the difference between the ICO euphoria of 2017, which we thought was bullshit to be like right out of the gates. We wrote about it and still we built a company, uh, knowing that we

might cater to assets like that in the future, because some of them would stick 90% of them will wash out, 10% of them would stick. The difference with DeFi yield farming and with the ICO boom in 2017 is that was just unregistered securities issuance, by and large. I don't care what your white paper said, some of the worst and most offensive frauds during the time that will never get prosecuted because they raise so much money and they can just hire the right lawyers to, uh, to help them get away with it. Just like the banks. Um, they literally had in their token sale documents, there is no utility, uh, never will be any use or, you know, any reason to invest, nor is this even an investment. You're literally just

purchasing a funny money token. That's never going to do anything. They booked it as revenue. They booked it as revenue and they booked it as revenue. In some cases, they raised billions of in the process. And everybody took those sales like wink, wink, nudge, nudge. They have to write this because the SEC is watching. But in fact, what was still being done was you're raising money with people hoping to get rich. And now I don't feel bad for most of the people that piled in because no one cared about the tech they were investing in. No one was thinking about it like a long-term investor. It was just like, who's going to be the greater fool on the other side of my investment. That was 2017. The difference now is, most of the networks that introduced

tokens this year have been working, have been functioning for a couple of years now, and they've seen their volumes spike significantly. Talking about decentralized exchange, I'm talking about some of the lending protocols in particular. That's important because these worked before they introduced the concept of these governance tokens necessarily. What Yield Farming did was it essentially introduced tokens as an incentive for people to participate more actively in these networks. For decentralized exchange, that means actually becoming a market maker, right? And the market makers can make money just like you would in kind of traditional financial markets. Slightly different design because you're talking about smart contracts, but basically the market makers can make money.

How do you solve this cold start problem and encourage more of them to make money? Well, you give them this token in addition to the fees that they're going to earn by staking assets and making these markets. And those will constitute ownership interests in this globally decentralized network, and they'll be able to control it. And by the way, part of that governance and control is going to be their ability to set protocol fees long term, which will accrue to them. So there is a cash flow component here, almost like investing in, you know, if you were able

to invest in a decentralized Facebook from day one. And Facebook had gradually gone public with a data token that said every single user that we onboard, every single ad dollar that we make, we're kind of gradually, we're going to give you the early users more of these tokens because you're valuable in helping us bootstrap this network. You're helping us create gravity to this system. And ultimately you're going to help us scale into a really big business. So you can price them, you know, like using traditional methodologies. Lending was the same thing. You know, when Compound issued their token, they were already scaling and doing very well.

The issue was most people didn't want to pick up pennies in front of a steamroller by lending money out through this smart contract platform for a marginal return. Still better than the legacy markets. But, you know, is it worth the risk? Because there's all this idiosyncratic risk of Ethereum and the individual lending protocol. And so the token was a way to kind of pull forward demand again and essentially decentralize the ownership of that cash producing network utility. But I mean, that's a big, big change. But I don't know the answer to this, but then that's what I'm asking. My understanding is that compound worked perfectly fine without the token. It did, but it was going to scale very slowly, right? Because you're talking about, okay, how can we get people to contribute and lend in this peer-to-peer marketplace that has all of these other extracurricular risks when they're going to get like 4%. That's why I say it's like picking pennies up in front of a steamroller.

These DeFi tokens were sweeteners and they were methods of arguably protecting networks long term because all of these software developers that created them initially, as those networks got bigger and bigger, I think we're going to run into more regulatory risks. What is your actual control here? And so you need to actually provably get these things decentralized just basically to protect their network integrity. Um, so, uh, you know, I'd say for, for a subclass of like market leaders that already had useful working products that were scaling, that the unit economics made sense. Those tokens also made sense. Now, were there a bunch of like bullshit projects that got layered on in August and September when, you know, the hype was going nuts, of course. Um, and that was no different from, from the ICOs, right? The Ethereum ICO, very interesting, you know, in hindsight, um, you

Some of the Filecoin sale, very interesting, arguably, in hindsight, because you can actually back into, OK, what are the platform economics of these things? And because they were kind of first to market, you knew that the teams were actually thinking about these in a way that they were trying to align incentives long term and actually scale these networks, not just get rich quick, which is what all the kind of fast followers have done. Yeah. And I think part of the detractor argument, right, is like Compound's a great example where really the token was pure financial engineering, right? Is, hey, we're going to create this token, then we're going to try to give it to users to drastically increase the financial return they get so that it incentivizes more people to come onto the system. And again, I'm not going to debate whether that's good, bad, whatever. It's just financial engineering. And when people hear me say financial engineering, they're going to think of it from a negative connotation. connotation but again almost every single thing in the traditional market has some level of

financial engineering to it right so it's just that is what occurs in in financial markets i think the part that um there's a spectrum right and this is where uh i think the debate really happens with or the controversial uh conversations is like that spectrum of what is being told to investors or holders of those tokens so there's some people who are like very egregious uh literally they don't need the token whatsoever and they use they sell it in order to get revenue and that's basically how they survive right and i think that there's like very very egregious people there and then all the other on the other side of the spectrum is people who say like hey like this was working and we just used it in a very light way uh and like we were super transparent about

what we were doing and like maybe there was some kind of vote and everyone agreed that we should do it and and that's what we're doing and i think that like again there are people who fall all along that spectrum there's some people who think that the most egregious thing is actually fine and there's some people who think the lightest thing is like you know basically a crime right or shouldn't have happened and so i think part of this whole i don't know uh kind of complexity of the industry is nobody yet knows where we'll be 10 years from now right and so it's almost like that's how the market gets made in terms of there are people literally betting millions tens of millions hundreds millions billions you know in some cases tens of billions of dollars on some

of these networks playing out and some of them not playing out and that's where you get the vitriol that's where you get the debate that's where you get kind of all of this stuff uh and to your point like in 2017 when all the ico stuff was going on like i mean there wasn't a ton of people saying it but there were definitely some people being saying hey look icos are stupid like you shouldn't do this and 90 went to zero and people lost a lot of money and so i tend to think that like the market will just figure it out but the one thing i want to kind of bring up is i also think that the things that people are optimizing for when they're in like what i'll call like the weeds of defy yield farming for example they're optimizing something completely different than maybe the

average like bitcoin investor right and so what i don't know is and it's i don't actually think it's possible i don't think that we can kind of paint an entire industry with like a broad stroke of hey there's one size fits all as to what everyone should do because everyone's optimizing for something that's different right and so where that ends up playing out is there's returns that are driven where people build like somebody may actually build defi applications on ether or ethereum and somebody may go build the same thing on bitcoin and then like the market will decide who wins right so that's why like when it comes to the debate stuff i'm just like a like the market we'll decide right like i have my own personal opinions but like if the market is the ultimate

referee or judge then you actually want everyone trying as many things as possible and then like the thing that wins is that much better because it basically built all it beat all the other competition right yeah i mean the question is uh are you hedging and and where are you hedging right like some of these uh indices are toxic waste that just have like straight market cap rankings down, you know, uh, marking up what we did rankings down the top 10 or top 50 or top a hundred. Like that's just throwing money away. Um, but the question is, you know, where should you be diversifying if you want exposure to this, this emerging asset class and my argument, I actually more or less agree with you that, um, there's Bitcoin, which

is an asset. And then there's a theory in which is basically the leading force in the decentralized finance platform play. Um, and then everything else is just kind of, you picking horses, no different than picking infrastructure winners that have catered to the Bitcoin industry for years, the exchanges custodians. My general sense is that you need some exposure to Ethereum or its applications somewhere across that value stack in addition to Bitcoin, because there still is a chance that Bitcoin or crypto wins, but Bitcoin for whatever reason has um has a flaw that prevents it from from winning at scale yeah and this is the age old like diversification versus concentration right and uh people will all make their own uh

their own decisions from that i do think that the the one thing that uh will be very interesting to see actually i would love your opinion on this because we're talking about d5 uh my argument the entire time has been like i don't know 90 95 of these things aren't decentralized But if the government says, shut it down or you go to jail, there might be one or two, right, or five or whatever it is that can't be shut down. But majority of them can be shut down. And so here's the thing. They can't. Here's the thing.

The teams that spawn them could be shut down. Right. They could basically be, you know, pencils down on the project. You know, we're done here. The U.S. government knocked on our door and we're going to divest and whatever. But one of the beautiful things about the industry is that it's open source, and we've actually seen this experimentation play out with anonymous teams forking established projects, the entire code base, the entire model, basically, and siphoning off real value, real liquidity, essentially, overnight. This happened over the summer with Uniswap, and it's happened with a couple, you know, many other applications as well, which is why there's so many of these also-ran tokens that I agree are garbage. But in theory, credible, anonymous developers, which is not an oxymoron necessarily, people who have actually proven their bona fides over years of development in the space that are not actually known entities, they could swoop in and basically offer the same exact protocols and maintain the same exact protocols, but just fork the economics, basically create a new system from scratch.

and um with better privacy solutions also coming online it becomes harder and harder to track that down and this gets into this game of whack-a-mole that ultimately can happen uh on a global scale i tend to think that the thing that works in the industry's favor is that the powers that be are just going to be so slow in the west at least in the east totally different story right if they can take fucking jack ma off the street and say you really shouldn't have said at a conference and by the way your ipo is canceled like no one is untouchable over there like just just point blank like let's just get that out of the way like at any point in time china could become one of the biggest players in bitcoin and crypto or it could just be like

a nuclear threat uh to the entire industry for for a whole confluence of factors but when when i think about like decentralization crypto and the regulatory sphere i'm primarily thinking about the the west and in the u.s and europe um they're just not going to be as fast um or or or as well equipped to adapt um and i have i have a hot take too slow at the game i'm not applicable i have a hot take on this they're going to go the exact opposite direction i think that the u.s is going to end up being is going to end up embracing this harder than anybody else in the world i think i think in the next 10 presidential elections a bitcoiner will become president that's not somebody who's like entire existence is around bitcoin but somebody who

understands bitcoin believes in bitcoin right there's congressmen there's a senator now like there's people who are um understanding 10 10 presidential elections 40 years well yeah give yourself a little bit more of a fucking cushion pop come on man like 40 years like how long do you think this is going to take to play out i think we'll see it in that you know within the next four well it took 10 it took 10 years to get uh get a congressman right so like you know these are exponential markets man like i agree so it takes 40 years like we wasted our lives yeah well but here's the thing right is like so i always zoom out a little bit and i say okay well how long would it take for let's say bitcoin to become the global

reserve currency like i actually think that it is uh a multi-decade play now but that started in 2009 right and so we're kind of 10 11 years into this like there's a good chance of this another 10 or 20 years before you reach that now again you know bill gates hey we overestimate what we can do in one year underestimate what we can do in 10 i would say most people didn't think that we'd be sitting at 20 000 10 11 years after uh bitcoin you know kind of uh went public there but at the same time when you start to unpack some of this stuff like you know take the defi stuff i don't think that there's very many people who say hey we're not going to get decentralized applications all the controversy and debate is where does it get built right and where it gets

built heavily determines the structure of how it gets built right because most bitcoiners are like yeah of course there's going to be decentralized lending protocol you know or decentralized lending applications but it's going to get built on the bitcoin protocol right and some people disagree some people agree whatever but the structure in which that happens if it happens will be very different than if it gets built on another platform and i think that's the interesting part here is as this stuff occurs like do we end up in a world where you know take the internet there's only four or five protocols that actually end up mattering do we end up in a world where there's a gazillion protocols that matter and there's one that's specific for certain countries

or regions or you know use cases or whatever or do we end up in one where the strongest most secure chain eats the world again nobody knows right and i think that's the part that like everyone has their opinion and i think a lot of people walk around acting like uh there's facts right in terms of this is what's going to happen but i i don't know right i don't think you're saying you know well taken taken to the uh the extreme i mean we don't even need to get into too much of the esoteric of you know how these networks work but um you know you're you're a believer that a lot of this is going to get settled back to bitcoin um in fact one of my biggest regrets is that i thought that for a long time and that's one of the reasons i knew about ethereum

from the very earliest stages and i just couldn't wrap my head around the token sale and and the mechanics of that whole process i actually don't believe that you're gonna be shocked by that i actually don't believe that okay i i think i i think that bitcoin ends up revocating most of it what i think though is that most of what's happening on let's say ethereum take that as an example is exactly what happened in 1996 to 2000 all those ideas home runs a decade later food delivery streaming music like literally every single idea that was tried then ended up not succeeding and it was people um over or uh like short-term expectations outran consumer behavior right people weren't ready for food delivery shit people weren't ready for food

delivery in 2019 right it took a pandemic and now people are like oh yeah bring me my groceries and so i think the same thing kind of happens here where all these ideas end up getting built for sure but it's just you've got to allow the network to get built and you also have to allow the behavior to change and you can get retail people to go do you know cdps for example but like that doesn't matter until you get like big money to do it right in in the grand scheme of like global finance if you really want to replace kind of centralized entities that's who you have to get but as we saw with bitcoin like that could take years to happen and so it's like are the teams that are building this now going to be the ones that end up winning or do they basically try all

the right ideas but then other teams build them later i don't know we're gonna find out but like we've already seen technology evolve that way in the past so so i i think the two things that we're talking about though are protocols versus teams right you know like communities versus versus centralized companies. Yes, the 90s internet companies were a decade early, but the internet protocols and Linux was getting built out then as well. That's backbone for a lot of our modern web. I think one of the ways that you can tell most of the experimentation and most of the valuable protocol work may happen on Ethereum and these smart contract platforms versus Bitcoin, which is very rigidly focused on peer-to-peer payments and settlement, is that Bitcoin,

the asset, is increasingly getting pegged to be traded on Ethereum through this concept of wrapped tokens and these different interoperable protocols that essentially allow you to lock value in Bitcoin, lock a Bitcoin, and then create a synthetic version of it on Ethereum or another blockchain where it can actually be leveraged and used in some type of application. So that's because ETH is not money though. But yes, but I also wrote that, right? So like we're on the same page there. That doesn't mean that a multi-trillion dollar transaction processor that's scaling exponentially is not going to capture insane economics.

And there's not going to be massive security spend to actually preserve the strength of that network. if you look at Visa, right? Or MasterCard, it's just the card networks. Okay. They do one thing at scale incredibly well. How many different applications are going to come out for like an internet of money? That's the orders of magnitude larger that Ethereum or the winning smart contract protocols are going to be. And I just don't see the mind share there in Bitcoin to make that particular platform that extensible. That doesn't mean that Bitcoin may not win the race in terms of value creation. But this is why I think about if you're going to have exposure to this industry, you want exposure to crypto and the DeFi boom, even as early as it is. And then you also want

exposure, obviously, to the winning decentralized money. And I truly think that we're talking about two different industries almost at this point when people think about getting exposure to crypto. have to have a little bit of both all right but you can wait and i think that you have time but why wouldn't you clip the premium in the meantime if you can let me let me ask this last question on uh on ether uh do you look at bitcoin being back to all-time high levels and ether i think it's still down like 50 plus percent right didn't go i think it hit 1400 in 2017 if i remember real quickly. So it's like around $600. How do you look at that? Well, I wrote about this in the ETH is not money section, right? I think that was an anomaly in Bitcoin's history because there was

a few things happening at the same time. Maybe most importantly, Bitcoin was in the midst of its most contentious community issue that forked the network. And it was unclear for a few months which direction things were going to go in terms of which chain was going to win out, which way the community was ultimately going to shift. The winning side ended up being the side that was ostensibly the minority fork that was not necessarily supported by almost all of the largest investors, largest miners, and largest funded infrastructure companies in the industry, which is what made it such a wild time. Of course, the spike in Bitcoin's price and the high happened after that issue was finally put to bed and resolved. But 2017, while that was

going on for Bitcoin was also the year that the ICO boom occurred. And at that point, Ether wasn't money still, but it was serving as the reserve of that ecosystem. And you had to hold Ether in order to fund these ICOs. Now with the explosion of stable coins across the industry, and this is true for Bitcoin and Ethereum, it's less critical to actually hold an unstable reserve asset as we saw in the early days. So I don't think it's surprising, nor do I think it's an indictment of Ethereum that it's still 50% of its peak. The way that I look at it is it's maybe sustainably at a sixth of Bitcoin's market cap.

And exactly where that right dividing line is, I don't know. but I would, uh, I would certainly buy either when it's below 10% of Bitcoin's market cap and maybe sell it when it gets above 50% where the dividing line is anywhere in between, um, is, uh, is, is anybody's guess. I'm not gonna, I'm not gonna, my crystal ball is broken, man. I'm exhausted. Are you a flippening believer of all the market caps? No, I, I, uh, I think if that happens first of all that happens anytime soon we can fucking pack our toys and go home because it like it ruins bitcoin's narrative i think it hurts ethereum because ethereum is not ready for prime time yet that type of you know like sovereign attention um because the protocol itself is still

not you know ossified or battle tested particularly with this migration to um to basically an entirely new system. But I think at some point, could ETH be money is really the question. I think if Bitcoin loses fundability, basically, if there's top-down regulatory crackdowns that essentially create a bifurcated Bitcoin system between clean coins and dirty coins, that would be one attack vector. There are geopolitical risks around concentration of mining. If China and Western states came together and said, we're basically going to disallow this type of activity for whatever reasons, I think it has a much worse impact than anybody gives it credit for. I know it's more or less dismissed as FUD from the Bitcoin community. I don't think it is.

if it were like a true global coordinated crackdown on hashing and Bitcoin mining per se. And then the last thing, and maybe the most likely, is we will not know for a few more years how well Bitcoin's security model holds up when the rate of seniorage, basically annual network issuance of new Bitcoin dips down below 1% and then half a percent, and Ethereum has solved that problem. So, um, there may still be time, right. And, and Ethereum may get less risky over the course of the next few years as Bitcoin gets potentially more risky, depending on how things play out on that last front with, um, the fees to actually secure the network. But, you know, there's a lot that's going to happen between now and then. So, I mean, it's, it's like almost not

even worth talking about. Normally I just kind of like, you know, uh, I give hot takes on this and I immediately say literally everything that I'm saying means absolutely nothing because there are so many more massively important things that are going to happen in the interim that we have no idea how it's going to play out. I love it. The final boss is the final thing I want to talk about. Let's do it.

What is the final boss? And talk me through kind of your theory here. Every time that Bitcoin doesn't die, it gets stronger, right? Just this like Nassim Taleb concept of, of anti-fragility and it, it just won't die and it gets stronger every single year, um, from a combination of more people believing in it, more people using it, uh, more infrastructure being built around it, hardening of the code base. Um, and, uh, I truly think that the only real threat at this point to Bitcoin is going to

come from sovereigns. So this would be a combination of regulatory crackdowns and potential just outright bans. And that can come a few different ways. You can make it harder for anyone that's actually using Bitcoin and transacting the economy to get banking. You can essentially make it insanely expensive from a compliance standpoint, if not impossible from a compliance standpoint to actually satisfy regulator demands for what they want to see in order to support any transactions that go through the Bitcoin network. And we could see as Bitcoin and related applications get more private, right? If we do go from pseudonymous, but still traceable transaction sets through these, uh, forensics companies like Chainalysis and Elliptic and the

one, basically the ones that work with the governments and the big compliance teams worldwide. Um, if, um, if there are solutions that basically break the, the utility of those forensic tools, um, then you've got a big problem. And I think, you know, you can, you can see what we've started to see glimpses of, which is the DOJ, you know, CCP, other kind of global regulators saying, we're not sure how we feel about self-custody because it's kind of like a Swiss bank account in your pocket. And we're sure, we're sure not, um, uh, sure how we feel about privacy, uh, like blanket, you know, anonymity solutions, things like, uh, what Zcash has introduced, basically making it next to impossible to actually trace, you know, pseudonymously or

otherwise any transactions that happen on the network. And there's good reason for that, Right. That's not there. There needs to be some type of balance. And the good news is, in most cases, the folks that have built these tools have thought about that and they've been mindful of that challenge. And the fact that you're always going to you're going to need to help the regulated edges of the network, right. the interfaces on and off of these protocols, you're going to need to give them the tools to actually interface with the powers that be and catch bad guys and make sure that there's not systemic risk in these systems and things like that. So you're talking about we're at half a trillion dollars now in global market cap, almost 400

now for, for Bitcoin. So, uh, 400 billion now, um, that's, uh, that's no longer, you know, below the radar, uh, by any stretch. And, you know, I think that we'll see over a hundred thousand dollars Bitcoin, uh, by the end of next year. I don't know if that's, that's on par with you or if you're even, if you're even higher than that, I think, I think we're, I think you and I are both, you know, uh, like insanely bullish by traditional standards, but maybe, you know, not as shrill as some of the other folks that are just trying to get like the biggest number of posts in the wall street journal. Um, but I do think we'll see a hundred thousand dollars of Bitcoin.

And so at that point, um, you know, we're, we're, we're well over a trillion dollars, um, in market value. And the liquidity in that network is insane. So you can move a lot of money. Um, if you're, uh, if you're a bad actor, we're a good actor. Um, and that's, that's got its regulatory challenges and we, we got to figure out exactly how it's going to work. So, uh, final boss i am betting on bitcoin and good guys and the wild western frontier um for no other reason than i just think the west is completely dysfunctional and it's going to take them forever

to to fully wrap their their heads around it yeah i i also think uh there's this weird undertone of why don't we embrace it um and it sounds crazy right now because i agree with you like there's a lot of uh disjointness but when you see brian brooks you know hey you guys can custody this no one's going to ban it kind of a lot of stuff going on like that you really only need you know four or five more people uh in positions of uh influence and power i think to uh to kind of say hey maybe we should take this much more seriously and not as a threat but instead of as a almost as a parachute to some degree uh and unfortunately unfortunately brian might have like four four or more weeks left of a job because, you know, uh, he, you have to, you know, everything that

can be politicized will be politicized in the, in the U S uh, realm. And I unfortunately have the feeling that, um, the, the democratic party is going to be more hostile to this industry than the Republicans. Um, so, you know, we'll, we'll see how that ultimately plays out, but we gotta, we got to get more blue, uh, more blue reps on, uh, on, on team orange. If, uh, if we're going to actually have a good time next year, Sam Bankman freed is, uh, you know, he's going to buy his way into the white house at, uh, at the rate he's going. So, you know what, he's at least going to get a meeting with someone in the administration. That's a good thing for everybody. Absolutely. All right. Where can we send people to download the report,

find you on the internet and find out more about what you guys are building? Sure. Masari.io. We've got a brand spanking new homepage that was basically 10 feature releases rolling into one that actually just dropped last week as well. So it's been a big December for us. It's a beautiful interface to catch up on news, basic price information by sector, charting tools. It's really become my second screen. I think a lot of others, you know, really quickly, um, to get a full soup to nuts overview of, of, uh, how the market's performing day to day, you will see a link, uh, to the report crypto theses for 2021 front center, uh, right on, uh, right on that homepage, uh, for probably the next month or so. Um,

cause this will be the largest report that we have outside, at least through January, as you can imagine. So, uh, encourage people to go there, check out, um, the, uh, report and then sign up for our daily newsletter as well. If you're interested in getting more than just orange coin information from pop, um, and, and you want to actually take the, uh, take the purple pill, um, that, uh, that'll get you excited for, uh, I'm just going to try to layer the innuendo on cause we're recording late on a Sunday night. I, uh, I, I read about the other stuff. I just write about it when there's rug pulls and all the other nonsense. Oh man. You know what you said? you sound like the the bitcoiner's version of peter schiff now don't don't don't do that

don't do that again the mind pump again listen like i always say i've invested in uh more companies than most of the trolls on twitter that are building on top of this other stuff i'm not by any means uh not open-minded it's just i'm a i'm a rationalist right in terms of uh nobody nobody likes to call out the uh the the nonsense you can be successful and you can have a successful piece of technology or community and still say hey 80 of this stuff's nonsense but the one thing i will say uh outside of a select few people who um i'll call them like uh the eath heads and that that'll set them all off but there's a there's a couple outside of that group um i actually find that a lot of the developers and people who are building in the

space uh are very very open-minded one and two also very rational and if i ask them you know hey out of the defy applications like what percentage of them are actually decentralized but the answer they say would shock most people because you would think that they would just kind of be blind to everything and just say like oh 100 that's not what they answer like they actually answer honestly and and very open-minded and then they lay out an argument for like and here's how we get from, I don't know, 20% of them being decentralized to 80%, right. And so I, uh, I actually really enjoy talking to a lot of those people. Um, and, uh, you know, maybe we'll keep investing a little bit more. Bitcoin was centralized on Halloween, 2008. It's come a long

way since then. So has the rest of crypto, but, uh, yeah, we'll, we'll, we'll see what happens next year. Uh, and in the meantime, I am happy to continue going back and forth with you on Twitter. I'm at two bit idiots. Uh, pomp leapfrogged me by, I think, uh, an order of magnitude almost, uh, since our last conversation a couple of years ago. So I got out my game in the new year, but you know what? If, uh, if crypto takes off and you're wrong about DeFi, I'm going to be right on your nipping at your heels, baby. We will see. We will see. All right, my friend, listen, thank you so much for doing this. I'll do it again in the future. Absolutely. Thank you. Pomp.