The Wolf Of All Streets - 25 Predictions For 2023 | Solana's Massive Growth Potential | Tom Dunleavy, Messari

Episode Date: January 11, 2023

►► Sponsored by PRIME XBT! Sign up for a new trading account using the link below & receive up to a $7,000 deposit bonus with “wolfofallstreets” promo code. https://u.primexbt.com/WolfOfAllStreets Tom Dunleavy, Senior Research Analyst at Messari: https://twitter.com/dunleavy89 ►► JOIN THE FREE WOLF DEN NEWSLETTER https://www.getrevue.co/profile/TheWolfDen Follow Scott Melker: Twitter: https://twitter.com/scottmelker Facebook: https://www.facebook.com/wolfofallstreets Web: https://www.thewolfofallstreets.io Spotify: https://spoti.fi/30N5FDe Apple podcast: https://apple.co/3FASB2c #Bitcoin #Crypto #trading Timestamps: 0:00 Intro 3:00 25 predictions for 2023 5:40 Macro still matters 8:30 DePin, physical infrastructure 12:00 DeFi to become more useful 12:40 Decentralized social 15:30 Bitcoin nation-state & Bitcoin to become a reserve asset 17:30 Cosmos 2.0 is a hit 18:30 LSD bull market 20:00 Options volume to skyrocket 20:55 Move blockchains 22:05 Blockchain games 23:30 Ethereum dominance to reach 70% 24:50 L1 chains are here to stay 27:25 L1 chains will dominate & consolidate 28:30 2023 not the year of DAOs 28:50 Forget about institutional adoption 30:30 Crypto adoption 32:20 Self custody 33:10 Flippening 35:00 MEV to become the main source of income for stakers 36:20 Fundamentals matter again 37:20 Blockchain phone 38:30 Final words The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. This video was created for entertainment. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this video constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.

Everyone has their thesis and predictions for what's going to happen in markets in 2023, especially in the crypto market. But very few of them actually use data and critical thinking to come up with those. Most of them, obviously, are people on Twitter saying Bitcoin will go to 3000. Why? Because I just emotionally feel like Bitcoin is going to go to 3000. That's how we get most of the predictions that we see. But anyone who follows along with Massari knows that Ryan Selkis puts out a massive thesis at the end of every year, hundreds of pages of ideas based on data from his team on what's likely to happen. Well, Tom Dunleavy, who's today's guest and has been the guest here many times, has his own 25 predictions for 2023, some of which are based on what was written and comes from their team.

But there are some, as he says in his threads, notable deviations. Now, if you want to know, based on fact, what is likely to happen this year, of course, still opinions, then this is the stream that you guys want to watch. Let's go. Take a nap on the like button. If you're asking why I take a nap on the like button, I'm fresh off of two red-eye flights in three nights. I had to go, unfortunately, to Los Angeles for a funeral. My best friend's father died, so obviously not the best of circumstances to have had to make that trip, but I did get on a flight at 11 o'clock last night, land, drive two hours,

and make it back here within four minutes, literally, of this live stream. What a trip. Last night, I started to get a major skin rash on my face at the airport, and I didn't have a razor, so I had to buy six tiny pink women's razors to shave my face in the men's bathroom. I don't know if you ever tried to use a women's pink razor, which was all they had to shave your face, but each one is good for one stripe before it systematically falters and fails. And so I was walking around the airport trying to find new razors with half a shaved face. It was a really, really, really enlightening experience. But here we are, and I'm glad to be home, and i'm glad to be home and i'm glad to be

here once again with you guys and somehow to not have missed any of the streams this week before we get started of course sponsored by prime xbt check that out in the description now let's get in to the meat of what we've got today because it's kind of a lot. Kind of a lot. So I've got our guest today, of course, you guys know, you've seen him bring him on right now. Tom Dunleavy from Missouri who has done a lot of work on trying to figure out what the hell is going to happen in 2023. Tom, how are you, man? Doing well, man. You should just grow out the beard. That's kind of how my beard started. I just got lazy and then six years later all of a sudden it's it's here i used to be able to grow a very robust beard but now it gets to a certain point and my face i get like this terrible rash

and i have to immediately shave or it's a disaster so i just i can't be the full beard guy anymore and people remember i used to almost always have facial hair, even when I was doing these live streams. It is what it is. So listen, as I said, Masari, obviously, and Ryan specifically very somewhat renowned at this point for the end of the year thesis, right? Reviewing what's likely to happen in the year, taking a very honest appraisal at predictions of the past and what you got right and what you got wrong, maybe even put you on the spot. Were there any things that you thought would happen in 2022 that you feel like you got glaringly wrong? I wrote a newsletter myself saying, hey, here are 10 predictions I made for 2022. Four of them were right. I could say that only half, two of them were really right, and it wasn't great. Right? Yeah. For me personally, I don't think I saw any of the

systematic blowups or weaknesses as bad as they were. I thought the merge would be much more of a catalyst for institutional adoption and flows into the industry. That obviously was not the case, though Ethereum is out trading Bitcoin and most other alts outside of Solana at the moment. Still has not come to pass that that was the big entry point for everyone that I thought it would be, but still positive for the industry. That makes perfect sense. So let's dig in now to 2023. I know that's what people are looking for. You had an incredible Twitter thread. I'm just going to go ahead and share your screen you got it and we're literally just going to go through these right so this was your personal uh top 25 predictions for 2023 you shared some charts as you said some overlap with two-bit idiot that's ryan selkis

who has the best twitter name of all time and our firm wide thesis but some notable deviation deviations thank you to my awesome colleagues at Masari Crypto Researching for shaping many of these. All right, I'm gonna let you go ahead and dig in and start and we can discuss as appropriate. Awesome, will do. So yeah, Ryan has a lot of awesome theses. He brainstorms with us as well. So there'll be some overlap between his thoughts and my thoughts. But overall, these are sort of where I think things are going and some notable deviations, as I mentioned. Start off at the top, which I know everyone's not going to love, but macro still matters right now. We got rapid interest rate

increases, removal of liquidity. And when that happens, as I'll blow up this chart here, you'll see every time that we've increased rates at any meaningful rate, there's been some sort of crisis all the way back to the savings and loan, tech bubble, emerging market crisis, housing bubble. And the increase that we've done this year in rates is the fastest in history. So it's really hard for me to believe that we're not going to have some sort of new crisis. Big week for that sort of narrative right now. We have CPI tomorrow, as many listeners know. We have earnings seasons kicking off on Friday with all the big banks reporting. We're above trend in earnings estimates across the board.

Those will have to come down. And if those come down, if we experience a recession, we're going to see a lot of pain in equity markets. And that should feed over at least a little bit into crypto. So my first prediction is we could revisit or approach the lows, which could be unfortunate, but potentially another buying opportunity for a lot of folks. The brighter side of that coin is I think a lot of that will feed into the Fed easing off the brakes. And I'm not the only one to predict this. Zoltan Polzar came out yesterday and said that he actually thinks quantitative easing will happen in the back of the year. I think that's probably a little bit heavy handed.

I think that's optimistic, which is, by the way, quantitative easing is bad, but okay, right, right. But for markets. Yeah, yeah. Quantitative easing and liquidity for markets are good. If you're thinking about devaluation of the currency may be bad. This chart's a little blurry, but you can see this is the correlation between liquidity and stock prices, and it's basically at a one. So more liquidity, more quantitative easing, better markets do. The less liquidity, the more tightening, the worse markets do. The Fed are taking almost $100 billion worth of assets out of the markets right now. So obviously that's a negative if you're looking for risk assets. But in the back

half of the year, I think that can certainly recede and hopefully we see better days and brighter skies. So macro side, bad first half, maybe nicer second half. And this sort of correlates if you look long term at sort of the recessions and sort of how things play out in terms of timing. Recessions usually happen kind of six to nine months after you see yield curve inversions, which we just had. That's likely Q1, Q2 recession and markets bottom around there. So if we get the bottom of Q1, Q2, Q3, Q4 with this liquidity backdrop that I mentioned, could be very positive for markets and for crypto. So just turning more towards actually the things we care about, the assets that we think actually we could provide some alpha and interesting analysis on. You know, let's turn to D-PIN first, which is a term that Ryan actually coined and is trying to meme into existence. You know, these protocols have been called TIPIN or proof of physical work.

And what these are, are really just actual, you know, physical real world infrastructure assets that you're paying token incentives to users to actually spin up the network. So that's wireless networks, computer networks, storage networks. You may have heard of Helium, but there are a range of new protocols that are coming out. The problem with something like Helium was the token incentives. So inflationary token rewards. Poor tokenomics, right. Poor tokenomics, but right. Poor tokenomics. They're trying to fix that across a range of protocols and the use case is certainly there. So this is just one of the verticals within decentralized physical infrastructure is compute. So you use excess compute, you have excess

computer phone, excess computer in your laptop, you're not using all the time, you can actually, you know, give that to the network, you know, folks could actually utilize those services. And you can receive a benefit for that. So there's protocols like render and Akash that are doing things like that, In that vein, and if you're looking at the market sizing for these things, this is a trillion plus dollar industry. And right now, if you look at all of the centralized physical infrastructure tokens in aggregate, you're only looking at three billion dollars.

So the upside there is enormous. You also have some interesting ones like Hive Mapper, which is decentralized Google Maps. Demo, which is sort of like if you've seen like the progressive, you know, flow, like put the thing in your car, it'll kind of track like how your car is doing. You know, they have one of those. And I guess the natural question would be, why do you want that stuff? If you already have Google Maps? Why if you already have kind of like you know these other primitives like I mentioned with Progressive. Google Maps actually charges many businesses to you know list their services and provide additional data and information

so there's certainly an advantage there. Additionally the maps are not as updated as many would like. I mean you know takes two, three weeks, sometimes years to update certain services. So if you have an army of people driving around with these little HiveMapper things and getting tokens because of it, great, that sort of makes sense. Also, these cars are ridiculously expensive. So you have Google cars or whatever, $500,000 a car, you throw this little device in here, 500 bucks, you're earning some tokens. Great. That only matters when the tokens actually are worth something. So these things kind of hit flywheels as the bull market increases. So some names to watch there, as I mentioned, HiveMapper, Demo on the kind of sensor side,

on the compute side, Render, Akash, also some interesting names there. Perfect. I don't want to skip really quick. I know we kind of skipped three, but people are going to love this. It's triggering the way you wrote it. DeFi stops being just Ponzi games. The idea being there that we will see real world assets tokenized and that trend will start to begin, which I think was tokenize everything has been an ethos or an idea in crypto for a very long time. Yeah, I don't want to claim credit for the Maple Finance increase of 65% in the last two days, but it was mentioned here. I think DeFi to date has really just been Ponzi games. I don't think

anyone can really disagree with that after this year. So what are actual things we could do to make DeFi useful and tokenizing and putting real world assets on chain is one of the biggest and sort of easiest use cases. The challenge to the end has been getting folks on board to actually do that. So you've seen a push to do that through Maker and sort of others with local community banks sort of supporting that as well. Perfect. Let's keep rolling to number five. Cool. So decentralized social, horrible name, Vitalik made it. He earned the right to make all the horrible names he wanted. It's really just on-chain identity. So that's really

potentially going to not only open up sort of a range of things that you can do with your personal identity online, whether it be in DAOs or sort of other mechanisms. But also to me, what I think is really interesting is that as you start to develop an on-chain reputation, you can just start to become trustworthy. And potentially, that could help develop a system around under-collateralized lending. Right now, most of DeFi is over-collateralized. That is really not conducive to liquidity. It constrains the ecosystem. So going forward, I think this is going to be an enormous trend. Right now we have Forecaster, we have Lens. If you look at the daily active users for those, they're really low at the moment. It's 35,000 for Lens, like 3K for

Forecaster. They're still sort of in beta rolling out mode. And user interfaces for a lot of these, once you get your profile, aren't stellar. So one of the investable verticals that I think we'll see emerge throughout the year is really just this identity stack. So it's not only those protocols on top of Lens and Farcaster, but also the protocols that can actually build credentials on chain and verify those. So hey, you know, you attended this university, great, you know, it's attached to your identity. So that's important for under collateralized lending. But it's also important in sort of third world countries. One of the biggest problems with education in sort of third world countries is like, you know, if you move from one country to another, you may not be able to bring your

certificates, you may not may not be able to say like, I graduated high school, no one will believe you. So putting all that stuff on chain, just another primitive, another example of things that, you know, default or real world use cases for crypto that, you know, we really aren't seeing or tapping into today. So big theme there, I think it's going to take a little while to get right, but the groundwork's there. I would also argue that this is sort of the bridge from web two to web three, if you can utilize that identity as your login everywhere and it prevents sort of hacking and the impersonation and all of those things. I know, you know, there's quite a few companies that are working on this. So I agree with you even beyond the lending side, that it just is extremely pragmatic to have a single identity that you have

secured and known the private keys for and that's it right so yeah it should be simple to yeah totally agree so it should be simple to if you think about just like signing with google right now that's what i use for essentially everything because it's i know um you know my password's there it's safe and you know it sort of abstracts away the the need for a password for each website you just do sign in uh with ethereum for everything if that becomes a primitive that that's another huge leap and i abstracts away the need for a password for each website. If you just do sign in with Ethereum for everything, if that becomes a primitive, that's another huge leap and I think is an onboarding event for a lot of people. Okay. Number six, Bitcoin, nation, state, central bank,

buy by one G20 country with Argentina question. I mean, Argentina, obviously we know that they have a very pro-Bitcoin presidential candidate, a lot of problems with inflation, but then also a lot of pushback from the IMF. But that's a conversation for a different time. So talk about why you think we're going to actually see a central bank buy Bitcoin. Yeah. So this is by a noted crypto pumper, Harvard University. So you're going to want to take this one with a grain of salt. But they basically wrote a white paper, someone, one of the researchers there wrote a white paper that said, because a lot of the sanctions this year on treasuries around the Russia incident, folks are actually going to start thinking of not only gold, but Bitcoin as a potentially censorship resistant asset for their central bank reserves.

It doesn't have to be a lot, just has to be a little bit. And I think we start to see at least one country adopt this in the near term, probably one of those countries on the fringes of the G20, or like Argentina or one of the others. I don't think you're getting a Eurozone country yet. It's interesting because that narrative, well, we'll go on to number six, of course, which is S&P Company. But that narrative with MicroStrategy in August or September of 2020, whatever it is, was really what sparked the entire last bull market. And then we just never beyond Tesla saw it happen with another company or a huge country. So it's nice to be revisiting that narrative, which is more Bitcoin specific. Yeah. And the reason you didn't see that in area for a lot of companies is the upside,

the downside was not commensurate to the upside. Every time you took a loss on your Bitcoin position, you had to mark it down because it was an intangible asset according to accounting standards. Now you can actually mark the assets up and down. So it becomes a little bit of an easier sell to your board or whoever to hold a portion of your treasury in Bitcoin or Ethereum or the like. Yeah, perfect. I mean, that effectively covers six. So let's move on to seven, TVL on AppChain, two Xs, Cosmos 2.0 is a hit. Yeah, I think Cosmos is really going to be, is sort of set for a big year if they can get Adam 2.0 right.

But even if they don't, the out of the box functionality modularity of Cosmos chains is a great place to start for a lot of ecosystems, especially when they don't need the broader economic security of Ethereum yet and a place to experiment. So I think you could see a movement back and forth between sort of L2s and Cosmos app chains, depending on what you need, the functionality you need behind the scenes, sort of the communication you need between chains and the security you need. So I think, you know, Cosmos TVL right now is sort of hilariously low for what I think is probably the most interesting ecosystem outside of Ethereum that's trying to do something completely different. So I think we're going to see a lot of growth there and a lot of interest there as we go forward. So apparently at number eight, we're all going to be doing a whole lot of acid. LSD bull market.

Yes, let's go. LSD bull market. We are already tripping to start the year. If you've already looked at prices for Lido and Rocket Pool, they're up a hilarious amount in the past two weeks. So again, this is a, hopefully it stays for the year, but this is a small win so far. Yeah. Essentially the bull case here is you get withdrawals in March for Ethereum, which is most of these liquid staking derivatives revenue. You get yields that are likely to jump in the next bull market as you get transaction fees and MEB routing back to these liquid staking tokens.

You look at Ethereum today, it's only like 15% that are staking. A lot of that is the illiquidity risk of, hey, I don't know when I can withdraw this stuff. Yeah, that's changing with the Shanghai hard fork. Exactly. So that's March. So if you look at these others, so on screen here, you'll see the other protocols. And this was as of April. But these have only really gone up. And you can see I just crossed out Terra on set face. Like we make in the chart.

All these other protocols are 50% plus in terms of how much is staked. So if you even approach those numbers for Ethereum, you know, Lido gets 10% of revenue for the validators, Rocketpool gets a percentage. You know, I think those, those are all likely to benefit as you see more stakers sort of come into the ecosystem. Cool. Number, where are we at number Number nine, options notional dollars exceeds 100 billion a month. This actually blew my mind. So if you just look at options volume today for crypto, it is dominated by Deribit. One player, 92% of volume. 90%, yeah, it's crazy.

And options volume in equities world is equal to or higher than spot prices. In crypto world, you have spot volumes being 20 X options volumes. So that should, that gap should close. And if that gap closes, Durabit's not going to be the winner, you know, by itself. Traditional options markets have four major players. So you're likely to see at least a few of these, and this is Ledger X is obviously up for grabs at the moment, but you're likely to see a few of these kind of upstart players, and there are a number of them, Lyra, DopeX, Premier Finance, et cetera, make a run at at least gaining some sort of market share. So definitely a few of those to watch as well. Yeah, the next one is move blockchains,

provide advantages versus solidity, Rust-based. These garner some interest, TVL. Of course, we're talking largely about Aptos. I had MoShake on last week to talk about that. So for anyone who's not familiar, Move is the programming language, effectively, that is the residual effect of the Libra and VM project. And many say it's much easier to program on, more robust. And you can correct me if I'm wrong, but that's effectively the background of it as far as I understand it. Yeah. Some developers I've talked to said you can sort of spin up a chain in hours versus days. It's very similar to Rust. It also eliminates the bugs, eliminates one of the biggest problems with solidity, which is re-entrancy bugs

and provides more flexibility kind of at the base layer. Okay. Does that matter? You know, they're improving solidity, they're improving the EVM potentially, but you know, these funds, and this is the Aptos ecosystem today, which I think a lot of people would be surprised how many, how many things are already sort of blossoming over there, but they have an enormous ecosystem fund to incentivize development. If nothing else, I think, you know think folks will at least explore Aptos, Sui, and others. Whether or not they stay and it becomes sticky is another story. Right. Perfect. I like number 11 because God knows we need it. At least one AAA quality game launches, but game tokenomics remain a challenge. I think that it's fair to say that crypto gaming has been

more of a concept than a reality and that the games that have come out have been, I don't know, early 2000s, late 1990s level, but people have generally played them because there's an economic incentive. But getting an actual game that people want to play that also has that economic incentive could be, for me, certainly a huge driver of the crypto market in general for a very long time to come. Totally agree. And these games take time and we're not patient in crypto. So, it's $3 billion we're invested in the past two years. Most AAA games take three to five years to come. There are a lot on the docket. I didn't list them all here because of the character limit, but there are 10, 20, 30 AAA games that are coming in the next 18 months

or so. And the VCs that I've talked to also echo this, who are sort of right at the ground level with these things, that these games are coming. And if you've played or just give a quick YouTube search for the Illuvium demo, it looks pretty awesome. So they're just going to hopefully abstract away a lot of the crypto stuff. Josh Young Alivio is one of the few very sizable bags that I have that I'm just sitting on down however many multiples since I bought it because I have the same thesis that it won't matter in a few years when it actually launches and is winning. So I like that one. Number 12, ETH dominance is cemented and rises to 70% plus.

I have some Star Atlas tokens that I have no idea what to do with. So I also have Star Atlas and Polis. And now it's like, I've kind of made the joke over and over that because FTX went down and Blockfolio was my tracker app that I no longer obsess over my balance and haven't literally,

I don't even have a way right now to actively look at my entire portfolio at once. And it's been just heavenly. It's fantastic. Yeah, I don't think the tokenomics are going to be solved this year. So just more that there will be a fun game. That's the pitch. But we'll see. ETH dominance is going to continue to rise. I think the longer we're in this bear market, the more that we give Ethereum time to actually progress down its roadmap. And all of the challenges you see with Ethereum that exist today, whether it be too expensive, too slow, not advanced enough as maybe the new blockchains are, are really going to all go away in the next 18 months. And by the end of 2023, we're likely to see Ethereum just as fast and as cheap as everyone wants it to be with the scaling of kind of L2s and L3s, not even to mention ZK EVMs and all the other improvements you're seeing. So, you know,

unless we get out of this bear market and we start hitting sort of a flywheel for a lot of these other alt L1 tokens, I think it's going to be a challenge for them to catch up. But kind of rolling right into our next thesis here, alt L1s are not going to completely go away. And you can see that with Solana just the last few weeks, it was comically oversold for the ecosystem. I'm just going to flip to another slide here because I just wrote a piece on it. And this is the amount of wallets here on active wallets on Solana. And you can see after FTX, it actually really didn't drop off. And you had this bonk airdrop, whatever. You had a positive Vitalik tweet, which hits the flywheel and it gets people

going back up again and investing and exploring the ecosystem. But even if you exclude all of that, you just see that the ecosystem really didn't lose as much as people thought it did. One FTX collapsed. So I think just on the valuation metrics perspective, all the green here for Solana, it's still undervalued. If you look at active users, transactions, stablecoin volume, TVL is not great. But on a fundamental basis, Solana compared to many of these other protocols is really still well undervalued. So I'm interested to see how that ecosystem grows, especially as we get SMS, NEON, which is the EVM for Solana, that's going to be great for user adoption. Yeah. I mean, when you look at this and I mean, I had my doubts that Solana was going to quote

unquote survive in the midst of it, sort of with the emotional opinion that everyone had, but there became a point where it was comical, as you said. And it's very interesting actually to look at that chart and see that the wallets didn't fall off. I don't think people knew that. And so this is just yet another case of just price getting wrecked with value not really changing that much. And it's kind of like this is the biggest baby being thrown out with the FTX bathwater that we've seen. Like Solana was not like, yes, Sam was a fan of Solana, but Solana doesn't exist because of FTX. Yeah, exactly. And all it just, Solana's like got a weird account structure

and you're only supposed to look at certain types of accounts and transactions and all this data is controlled for that. So even controlling for all the intricacies of Solana, it still is looking fairly attractive. Also, you know, Cosmos, no surprise here. Also bullish Cosmos as no surprise here. Also, bullish Cosmos, as I hit on before. I will point to just how brutal this drop off was. This is Terra. This is TVL, $25 billion down to $3 billion after Terra collapsed. So thoughts and prayers, but we'll bounce back in

2023. Right. And that brings us to more L1s, right? We're up to 15 in continued consolidation of L1s here. Yeah. So continuing on that theme. So I think it's really going to be Ethereum, Cosmos, BNB, and Solana

are going to really dominate 90% plus market share in this year as the investment continues to grow there, as the builders start to consolidate. If you're building on a new chain, like I mentioned, you'll probably explore Aptos and Sui because you can get some incentives and maybe you find something in there and maybe they find a nice application there. But if I think that the ecosystem could potentially completely collapse, it's really hard for me to have a lot of investment in those ecosystems.

So I think a lot of the TVL and a lot of the growth is going to continue to consolidate on L1s. Cool. Yeah. I'll skip this one. NFTs keep going beyond PFPs. I got some lazy lines bags. Yeah. Sorry about this BMW Reddit. I think, yeah, I think everyone agrees that regardless of like what a pudgy penguin is worth that the actual utility of NFTs is going to continue to expand and be adopted by large companies. Absolutely. Next one. So DAO adoption, you know, I think DAO

governance is still an absolute mess. It's clunky. Even the best DAOs don't do it well. You know, we need better tooling. We need coordination models and people just need the time to figure that out. I don't think we're going to be there in 2023. It's probably a 2024 story. That doesn't mean that Uniswap goes down, but it means probably all the other DAOs are sort of stuck in the mud for a while. Agree. You know, institutional adoption is a narrative, is a meme.

I don't think it's going to be all at once in 2023, but I think a lot of institutions will use this as a time to actually start to invest and acquire protocols and acquire good tech because it just makes sort of business sense for them. intermediaries in the legacy finance system, that is revenue for all of those companies. They understand a lot of that is going to be squeezed. The margins are going to compress, and it's time to get in on that while assets are on the cheap. So I don't think you've really seen a lot of traditional finance companies pull back from investment. And behind the scenes, I know a lot of them are doubling down, talking to Fidelity and others. They're expanding head count rather than contracting head count. Interesting. I mean, on November 15th, I just happened to pull it up. I tweeted this, Wall Street is going to sweep in and buy up our entire industry for pennies on the dollar. Watch. And I still fully believe that. I mean, I'm hearing rumblings that, you know,

0.72. And we've obviously seen what BlackRock is doing in space. But, Aldi, I think that one of my narratives maybe for 2023 and 2024 is going to be very large distressed asset funds from Wall Street buying up miners and protocols and stuff for pennies on the dollar, kind of what you alluded to there. I like that. Yeah, I think that's natural and it makes sense given the range of opportunities that they have at the moment too distressed in my prior career i worked a lot of distressed debt investors with interest rates as high as really challenging to to meet the hurdle rate that they're looking for so they have to start sort of lagging out as well um so crypto adoption number 19 here continues to be a non-us story and uh you know this is sort of unfortunate but if you look at sort of analysis you know the top companies with the top countries of crypto adoption, Vietnam, Philippines, Ukraine, India, US is on here, but you look at the other countries, Pakistan, it's all countries with corruption, high cost

to transfer dollars. We still live in a dollar-based world. And the cost to actually transfer dollars is 6% to 10% outside the US, sometimes even higher. So it's really a simple use case. Hey, stablecoins make crypto useful and that is going to continue to be the case outside the US. And Tron has built a business on this. If you look at Tron's actual transaction metrics, it's basically a chain to transfer Tether at cheap costs. So that's going to continue. Hopefully we can get regulation right in the US. We bring a lot of it back on shore, but- Okay. Yeah, number 20. Web 2 devs moving to Web 3. Tons of layoffs in Web 2. I don't think a lot of people are

missing the headlines there. You get a lot of chains that are adding Rust compatibility. Also move is very similar to Rust. That's a great Web2 language that, you know, I think Jack Dorsey himself called the perfect language. So a lot of these devs are going to start to move over and think about Web3, especially they're like, you know, you know, they may not be bought into the crypto ethos, but, you know, they start to think about, hey, I can get some upside incentives here, I can't get in Web2 anymore, especially as you get many of the new graduates who are crypto curious are able to sort of jump in. And this is last year's electric capital report. And you only have 20,000 Web2 developers, which is kind of hilarious. So I think we're going to 5X up this year. Next one, I think Yago is going to love. I know he's railing on me last time I was on because I was saying self-custody is not all of it's cracked up to be. But I think this year we're going to actually see more self-custody because of the primitives that are sort of behind the scenes and making it easier. A lot of things I kind of was echoing. If you used Argent or one of those other new wallets, they're definitely

easier than kind of using a MetaMask. And seen, you know, And I was just going to say, and I mean, ledger hiring now, the name I'm blanking on obviously, but the, the, uh, you know, creator of the iPod or designer of the iPod and their new device that you can look at clearly, we're going to make a huge step this year in UX UI for self-custody. Yeah, absolutely. And you've seen Dex volumes just spike this year because of that. So no surprises there. Flippening, let's do it. This is fun this year. Let's go. Prediction at 22. Let's go. I think it's simple. It's a flow's argument. And a few people have sort of made this point. And I think it's really powerful to see that miners are selling 100% of their

coins. So if you just look at this chart here, this is the Bitcoin miner summary for last year. These 10 miners, the top 10 miners sold essentially their entire stack of Bitcoin that they mined in 2022. If you're selling billions of dollars of assets a year, that is just a natural flow-based headwind for the asset. Ethereum does not have that headwind anymore post the merge. And you've seen this divergence so far. You would think if we're in a risk-off environment in sort of equity world, Bitcoin would naturally lead the charge versus Ethereum, but Ethereum is outperforming Bitcoin. You can see that in the ratio. So I really think this is going to be the year that, especially as we hit the back half of the

year, as we get the bull market and you see those flows really start to compound, you're going to have a flippening in terms of the ratio there. Please no Bitcoin maximalists watch this stream today. You guys can just skip this one and come back tomorrow. Just add me. I see my notifications going up, so I'm sure- I didn't say it does. Listen, I don't know about the timing.

And honestly, the flippening narrative to me is like, I've said this many times. I view Bitcoin as kind of a separate asset class from all the rest anyways. So it's sort of like, would I care if Amazon flipped gold? No. Or if Google Alphabet flipped gold? No. But I know that it's very triggering to a lot of people. But market cap is a very simple

metric and doesn't tell a whole story, but we can go on. MEV becomes a primary source of revenue. First of all, I think a lot of people don't know what MEV is. So can you just go ahead and tell them? Yeah, it's maximal extractable value. It used to be minor extractable value. It's essentially the profit for opportunities like front running and sandwich attacks and things like that, that you could find by exploiting transactions on chain. You have this mempool where you basically signify your intent to do a transaction. Someone sees that and they say, oh, I could do this transaction faster. They pay a little more for it and they capture some value there.

So if you just look at the revenue for Ethereum, it's essentially transaction fees and MEV. And over time, as transaction fees come down, a lot of it's just going to be MEV. And as transactions go up, MEV opportunities become more and you're able to potentially route that back to validators. And if you are a wallet provider who's running or pointing your service to your own set of nodes, you actually could potentially provide some of that MEV value back to users of your wallet and subsidize it.

That's an opportunity. There's a theme in 2023 that I think we could see emerge as well as sort of like wallet wars. So MetaMask versus others. And this could be one of the avenues they compete on is sort of providing rebates or providing fees back to customers. 24 is interesting. Fundamentals matter again. I like the again part. We could have just left it at fundamentals matter because I don't remember the time when they mattered before, but I like it. Maybe that was a dream of mine. So you see, this is hilarious just looking at this. It's a little sickening as well. I mean, you have Doge, Shiba, Ethereum Classic, Litecoin all in the top 20 right now. Solana obviously is way up since I took this screenshot. But I think we start to take out some of this trash. I mean, you have probably saw some sort of meme premium here for Dogecoin or whatever,

but like is Dogecoin really the eighth most valuable cryptocurrency? Probably not. Well, hopefully not going forward. So hopefully things change there. Next one. So mobile, I think a lot of people are bearish on mobile and think it is sort of a joke that Solana phone hasn't really sold that much yet. But I think many people are looking at it the wrong way. You know, most users today of the internet use their phone. I mean, 56% here, percent of mobile, percent of internet traffic globally are phone users. So providing an easier user experience on your phone for crypto

and also for developers to develop applications on the phone is extremely important if we want to actually build more users, more developers, more adoption. So I think the Solana phone is not going to be like this, oh, wow moment, but it's going to be this for users, more developers, more adoption. So I think the Solana phone is not going to be like this, oh, wow moment, but it's going to be this for users, but it's going to be this, oh, wow moment for developers. Like, oh, I can build these interesting things. Oh, it's, you know, my wallet's already natively in the phone. You know, great. I can build this, you know, new layer on top of it. And then you're going to see a lot of, you know, protocols and chains sort of follow suit to try to think about ways to uh to tap into that so i think

salon mobile is going to be just sort of an eye-opening moment for the industry of how we can sort of progress forward perfect i mean that took a lot of thinking and work i would imagine those are pretty bold predictions hot takes that's it no No, no, I think there there's definitely, if you look at the numbers, some of them are a bit bold, I didn't, you know, cover the numbers here, but you know, I think a lot of them are already started moving in the right direction, which is nice to see, you know, you have liquid taken derivatives, you have Solana bouncing, you have a lot of people interested in cosmos,

but it's going to be a long year. And unfortunately, I think a lot of the predictions you know, hinge on macro clearing up at some point in 2020 literally all of this is moot if like number one it goes goes bad and is delayed six months right i mean not not to put you on the scout the the spot but what um do you have any sort of predictions that are top of mind for you for uh 2023 that um well i definitely don't think we're to see QE the back half of the year. The only thing I don't have any particular hot takes actually agree with a lot of what you said. I just think getting the timing is very difficult. Yeah. I would maybe be surprised if we get the bull market starting again,

aggressively in Q3, and maybe not Q4 and leaning into 2024 and kind of the election year and stuff because the Fed has remained so just insanely sort of hawkish in their tone. So I think unless something like seriously breaks, I think we might just, I think it might be a more boring year than some of these predictions lead to. But if that means they come true three months later, I don't think that that is meaningful. Right. So for me, maybe I just like, I'm a little more pessimistic on the timing, but. Totally fair. You could extend these predictions maybe into first half of 2024. And I don't think they're directionally unreasonable, but I've been hoping for quick pain in the equity markets for the past six months. And I think we're just kind of just like drawing it out and the Fed is trying to make it happen and no one is.

Just capitulate already. But I think you've literally touched on every single thing i would have uh highlighted you know um and i mean if all of these came came came true we'd be well on our way to 100 grand bitcoin in 2024. from uh yeah well we'll see i know the last one uh bonus one here is we're going to be less uh looked down upon on the christmas and thanksgiving parties of 2023 and that's the only prediction that matters man can we just get to the point where people don't hate us and laugh at us all the time grandma's not asking are you okay are you everyone i get the check-ins i'm like yeah i'm fine i'm still i'm here it's fine. I'm still, I'm here. It's fine. Are you okay?

You have your own meta asshole, like to my friends, you know, like, come on. How's your Tesla stock doing? You know, like it's,

it's sort of, I still hate the disingenuous sort of tone about crypto and everything is in a bear market. Ethereum outperformed Tesla in 2022. Just, just, just suck it basically. Well, there we have it guys. Just drop that mic. Probably skip it. Fuck it, basically.

Well, there we have it, guys. Tom Dunleavy. So where can everybody follow you? You're Dunleavy89 on Twitter, but where can everybody sort of access this data, read the larger report from Masari, all those things? Masari.io, Theses is free. 160 or so pages that are better spelled out and have better charts than you can see here

on the little screen. So find it there and you can find all my work there as well. Awesome. Well, tomorrow, guys, we're going to have obviously the roundtable on Thursday. I know for a fact we have Bill Barheit and Mark Yusko joining. So that's going to be amazing. Tom, you're welcome back anytime. We should do this regularly. I like how you, I don't know, like actually think about things before you predict them. Endless alpha here. I can see in the comments that

everybody really enjoyed it. So guys, I will be back tomorrow. Please, please follow Tom. Do it. Just follow him. It's easy. Just click the button. Very easy. And that's all I got for you guys today. I will see you all tomorrow. Peace. Thanks, Tom. Do it. Just follow him. It's easy. Just click the button. Very easy. And that's all I got for you guys today. I will see you all tomorrow. Peace.

Thanks, Tom. Thanks, guys. Let's go.