The Wolf Of All Streets - Quantifying the Value of Digital Assets: What Equity Markets Can Teach Us About Crypto Fundamentals | Joshua Frank, The Tie

Episode Date: December 20, 2022

Learn about the difference between valuing stocks and cryptocurrencies, and how you can use data and information to become a more diligent investor. Joshua Frank is building The Tie, a market data provider for institutional investors, who use it to make investment and trading decisions every day.   Joshua Frank: https://twitter.com/joshua_frank_ ►► JOIN THE FREE WOLF DEN NEWSLETTER https://www.getrevue.co/profile/TheWolfDen  GET UP TO A $8,000 BONUS IN USDT AND TRADE ALL SPOT PAIRS ON BITGET FOR ZERO FEES! ►► https://thewolfofallstreets.info/bitget   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 1:30 How to value crypto 5:40 Bitget ad 6:38 Users of crypto 12:00 Equity vs crypto language 15:00 Understanding communities in crypto 19:00 Education is key 21:00 Alpha decay in crypto 23:30 Taxonomy 26:00 Pricing in the risk 29:40 Correlation 31:40 What we can learn from equity markets 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.

In the stock market, there's a prescribed way and framework for you to value the assets and companies that you're investing in. Some would argue that Bitcoin and the crypto space have no fundamentals and therefore we have no framework and no way to understand what our assets are worth. But using on-chain metrics and other creative ways of looking at these projects, protocols, and companies, there are ways to fundamentally value cryptocurrencies. Josh Frank tells us how. Welcome back, everybody. We're going to move on with the next Fireside Chat. If you guys were here yesterday, you probably caught the conversation that Josh and I had about how to

analyze on-chain data and to analyze on-chain data and use that on-chain data to make wise investing decisions. Today, we're going to focus more on how you value things in crypto fundamentally and use the stock market and other assets sort of as a comparison. I think it's fair to say there's an existing framework for how to value a company or a stock. You have earnings and dividends. It's very obvious. Whether it's accurate or not, everybody knows how to look at it and what lens to look at it through. Do we have that in crypto? Yeah. I think it's a really difficult and it's a good question. I think it's flowed and it's changed over time. I would argue that

the only fundamental that crypto had in 2013 or 2012 until 2018 was probably sentiment. It was really, what do people think about this asset? I think we're starting to see fundamentals emerge more. The thing about fundamentals, and I think I may have mentioned this yesterday, is the fact that they only really matter if they're widely accepted. Something isn't fundamental if only one person believes that it's fundamental. It has to be held by the majority. And I think we're starting to see a number of things take shape. I don't think that they're necessarily the right fundamentals,

but I think there are things that people think about as being fundamental. For example, protocol revenue is one example of that, which I think could be a very misleading metric. I'm happy to talk about it. I know we talked about it a bit yesterday, why it is or why it can be. I think developers and developer growth and things like that have become fundamental. I think things like social sentiment and the consensus have been. But I think we need to move to a better set of fundamental metrics that are similar or akin to our understanding of equity markets. I think it starts with, does this token accrue value

to the token holders? I think that's the first question that we need to ask ourselves. And then if the answer is yes, it's, okay, what are all of the things that would lead me to want to hold that token? And it also is the case that we need to do that on a per-sector basis. So, for example, GameFi. The way that I want to start thinking about GameFi fundamentals are, how many people are actually using this game? How active are the people that are using that game? How many hours per day are they spending on that game? And we can start to understand these things by looking at transactions on smart contracts. If we can see, for example, on a particular game on Avalanche, for example, that somebody

who's playing the game had some sort of transaction. And we need to start to quantify what that actually means in terms of being active. But I think we can start looking at usage and activity and things like that on GameFi. I think for DeFi, that's really where we start to see things look a lot more similar to equity fundamentals, where it is, what are the revenue of this protocol? And I think one thing that we need to keep in mind, and I think it's something that's not being discussed, is what is the revenue if you remove liquidity incentives? So, if you move basically the user getting paid to participate in this, would there actually be any revenue? Because we've seen with a number of things like LuxRare, for example, where there are incentives to wash trade these assets. I think we need to take non-incentivized activity out of there and start looking at, if there were no other incentives, what would the real activity be?

We see the same problem in equity markets, too, though. I don't know if you remember Getter and all these 15-minute delivery service apps, where, like, wow, there's 5 million people using this app, but by the way, it cost us $90 to deliver you eggs, which the user is paying $2 to buy. I think we need to start looking at it with that kind of lens as well. But I think it's much easier to look at crypto from a venture perspective, as opposed to looking at crypto from more of a... I like to think of cryptocurrencies more as privately traded companies as opposed to publicly traded companies. I think we need to look at them with more of a venture mindset,

as opposed to what this thing could be if the TAM grows, as opposed to what this thing is now. Because if we're looking at these assets in terms of what they are now, the answer is not much of anything. And so I think that that mindset is incredibly important. If you've been following me for the last few months, then you definitely know that I've been trading and investing on BitGet. Now listen, it took me six months to decide that they were going to be the sponsor for the newsletter. But once I saw their partnership with Juventus, that they were the world's leading copy trading platform in crypto, and also that they're a top five exchange by volume, well, I was sold and I was convinced. I've been using it ever since to dollar cost average and to invest in Bitcoin. You can also trade there with leverage,

but of course, be careful if you're going to do that. And I don't know if you saw the recent news, but they've also done a deal with Lionel Messi. Now you can get up to an $8,000 bonus using my link below, and you can trade spot with absolutely no fees. You also get a 15% discount on trading leverage. Go ahead and sign up right now using the wolf of all streets.info.bitget. Claim that huge reward and use the world's best trading platform. Very reminiscent of the dot-com bubble in the late 90s and 2000s, which a lot of people view as negative. I view it as a positive because the biggest companies in the world arose from that.

But what you're talking about harkens back to those days when it was all about network and how many people, but it had nothing to do with earnings or finance. Companies could lose billions and billions of dollars a year, but as long as they were growing in their customer base, they were perceived as gaining value. Is that the way that we should be looking at these now? Is that a lesson from that era? I think what we need to look at is once once the incentives dry up, are the users being retained? With a lot of these assets where users are getting paid to provide liquidity, or they're expecting an airdrop, or they're work-to-earning, as you mentioned on your last session, what is the

retention of those users after that dries up? Because I want to know, does anyone actually care about any of these assets? And what is the community after all is said and done? Who's actually excited about the protocol? I think that's incredibly important. I think what we also need to look at, which we're not looking at, is what are the demographics of the people using the particular application? I think that's actually really interesting. It's actually relatively simple to do.

We can look at time of day of people transacting to back out where, at least geographically, we think the user base lies. Look, I think you guys talked about Stepin in the Philippines, or Axie in the Philippines. I think it's great that folks in the Philippines want to use Axie, but that's a really small market. It's such a small market that they're making more money from Axie than they are at their jobs. There's not a huge addressable market. That doesn't mean Axie should be worth billions of dollars. We can also look at things from a chain perspective, how wealthy are the users that are actually interacting with this? If the users are continuing to come back after those incentives dry up, and they're wealthy users, and they're in time zones that we associate with

people that can provide a tremendous amount of economic value to these applications, I think that's quite exciting. Is that theoretical, or is that happening with any specific apps that you've seen or platforms as of now? Because I think we're still in that phase of you buy the asset, you stake it, you earn your yield, and you're not really concerned with what it does. Yeah, I think we are. I mean, that's why I led off with fundamentals are only fundamental if people believe in them. And so, we're obviously trying to pioneer a lot of that. We actually just rolled out, it's not even announced yet, so I don't know if you're live streaming or not.

So, it's going to be announced. No, it's recorded. Okay. So, you guys are the only ones to find out. We're rolling out really good unlock data today. My team spent over a year of man hours with U.S.-based people to build the data. And I think that's really fundamental and important to the space. And I think that's one thing that people are ready to start looking at when they think about fundamentals. You mentioned staking. To me,

staking is just inflation. That's all it is. It's just new assets coming onto the market. It's incredibly important when you're making an investment decision to understand inflation. There are certain assets on the market where only 5% of the supply is liquid today. What does that mean? That means that potentially, depending on the timeframe, some tokens are going to have 20X the supply in the next 36 months. That's totally fundamental to your understanding of the asset, because if there's not increased demand equivalent to that supply, we're only going down from here. I think people need to start to look at this data. In a bear market, people care more about fundamentals, which is great. I think that these things are going to emerge, but I think we need to have realistic

conversations. I'm not suggesting that I have any or all of the answers, but I think we need to start throwing all of these ideas on the table and having conversations as to how should we think about supply changes as it relates to it. I don't think we can back out a dollar and cents value for these tokens, but I can tell you, for example, Polygon has an unlock coming up in a few weeks, which is equivalent to, I think, 3% of the market cap of Polygon. That's really significant. And it's not a bad thing. It was decided ahead of time. In some cases, they change, or in some cases, things go on that are quite weird. But how does that impact the token's valuation?

We can model that out over time. It's quite easy. I think that the market is ready for fundamentals. I think that people just need to stop looking at vanity metrics. Nothing bothers me more than this idea of taking single metrics as being the total truth. Nothing bothered me more than that stupid stock-to-flow metric. I mean, it's asinine, just completely idiotic. It makes no sense.

It doesn't take into account anything macro, anything about Bitcoin adoption, anything. You can't look at a single metric in isolation. I think the way that we start to develop fundamental valuation frameworks is by building a taxonomy that's widely adopted on these assets and then determining, depending on what type of asset it is, how we actually think about the value that the asset should accrue. Interesting, because we started off saying, once the incentives are gone, what does the adoption look like? And that's the fundamental value.

But then you have to consider the actual tokenomics if you're going to invest in it, which is different than stocks. It's almost like you have this multifaceted thing where you could have widespread adoption, but the token could still go down because of poor tokenomics and unlocks and increasing supply, as you said. So, how is somebody supposed to figure that out? Yeah, it's really difficult. We're 10-plus years in and we're still figuring it out. But look, it takes a while for any market to mature. There weren't frameworks for valuing

equities. There were companies thousands of years ago, there weren't necessarily frameworks for valuing those companies. So, I think it's going to take time. I think we need to bucket it out. What is equivalent to equity markets? What can we take and what can we put into place? What is unique to crypto? I think one of the things that our industry struggles with is, I like to call crypto, it's going to be a bit vulgar, but the great dick-swinging contest of, who can come up with the most ridiculous name to name something? As opposed to, hey, why don't we just figure out what this thing is in light of equity markets? That way, it can be more widely accepted. What is a hard fork? A hard fork is, you're taking an asset, you're forking

it, and now you have two assets. It's kind of like a dividend. There's ways to think about it. A token burn is kind of like a stock buyback. I'm not suggesting that we need to call it exactly a stock buyback, but I think when we're presenting our educational content on this space, we should say, what is the equivalent in equity markets? None of us here are reinventing the wheel. We're not. We're taking shit that exists in traditional markets and applying it to crypto. I think we need to have that approach as to how we communicate properly. We're not going to get mainstream adoption if we're just throwing out all these ridiculous words like liquidity mining and ZK EVM and optimistic roll-ups. Let's use English and let's talk about things in a plain way. And I think it's often hard to talk about things in a plain way because people don't

under... The reason I think we throw our own words is because we ourselves don't yet understand everything. And I think we need to... If you can't explain why something exists or what it's doing or why it should accrue value in English, it probably shouldn't accrue value. Back to my point on separating out the crypto-native stuff from the traditional stuff, I think the things that can be thought about in a traditional context, like the on-chain data,

we should be thinking about things like revenue and usage and retention and stuff like that. I talked a lot about that yesterday. In terms of the stuff that's unique or novel to crypto, I think there's a lot of really interesting things that we can be looking at. One of the really cool things is that everything in crypto is open source code, which means we can now look at development activity. There have been a lot of conversations thus far about how many people are developing on this particular application. I think that's theoretically kind of interesting, but practically, it doesn't make any sense because I could literally go right

now on my computer, fork the repo of a particular chain, and now it looks like I'm a developer on that chain. I think we need to start looking at how can we fundamentally understand developer activity in crypto. I think the best way to understand it is just like you'd look at churn of users. Let's look at churn of developers. I want to know, where are the developers moving? We can actually track, we're doing this for our clients, for example, when developers on a particular chain are leaving and starting to develop on another chain. I want to know, where are the smartest minds, the developers, looking? We've seen this massive ship in development to Cosmos, as an example,

which has been quite interesting, where a lot of the largest developers on particular applications, like the number one most active developer on ThorChain, I've used this example before, just started developing on Cosmos a few months ago. I think it's really interesting to see where the developer mindset is shifting. Because these are open platforms, we should be looking at what are the developers doing? Where are they building? Where is the attention shifting to? I think we should be looking at other things that are similar and on-chain. I think sentiment as an example. I think sentiment broadly in equity markets is not great. The reason it's not great is because there's not a giant community of

fanboys of FactSet, which is a publicly traded company. But there are massive communities that exist in crypto. I think we do need to understand those communities and understand what they're talking about, what they're saying, and not just how much conversation, but what is the context of that conversation and how sophisticated it is. You mean the General Electric maxis are not a passionate community? Yeah, we joke about that all the time. That's something that's very unique to crypto, though. When you're a stock trader, you're less emotionally attached to the assets that you're trading.

Same for Forex. You get into crypto and people have this passionate, community-driven view, and then they are blinded by that and probably don't make wise investment decisions accordingly. Chainlink took off because of 4chan. It was all 4chan. It starts the pocket of people, and it grows, and it grows, and it grows. I think there's use cases of oracles, but no one knew what oracles were when Chainlink got started. No one was excited about Chainlink because of the underlying oracles. It was because of the Pepe memes that united that community. I think that's the case with a lot of stuff in this space.

You need to achieve critical mass and get things in front of them, and then you hope you can go from social to actual application and usage. You guys serve as institutional clients, so you probably know better than anyone what they need to hear or what they want to see to actually start gaining exposure to this asset class. You talked about speaking in a way that they understand stock buybacks, things like that. Is that just a function of poor education? Is that a barrier to them entering at this point? Do you still feel like they want to gain exposure, but they don't understand it well enough so they can't actually come up with a thesis and meaningfully deploy capital? Or do you think that we're crossing that chasm?

It depends who you're talking about. The hedge fund managers are some of the most sophisticated people in the entire world. They'll figure it out. But I think that education just slows adoption. I think education in this space has historically been horrific in that it's so focused on being bullish at all costs, and it sacrifices being practical and realistic and having real conversations. On top of that, I think it's just not simple enough. I think there's really simple ways to explain these things and explain how you can build conviction. I think one of the biggest challenges that exists in this space is the fact that information is just so siloed. That's obviously what we try to solve

for. We have a platform that aggregates everything for institutional clients. But if you go walk into a hedge fund manager's desk that's trading crypto, they have 40 tabs open on their browser. They're going to website A, website B, website D, website E, website F. How are you ever going to help somebody onboard onto crypto? They're not going to find those 40 sources to get that information. I think it comes down to education in plain English and then making it a lot more accessible to actually actively participate in this market. Because as an asset manager of a fund, you're a steward of outside capital, and you have the obligation to do your due diligence and manage your risk. I think one of the other

big barriers to adoption beyond education is risk management. There are no portfolio risk analytics tools in crypto that have widespread adoption. People have no clue the types of risks that they're exposed to. If I asked any of you guys about the smart contract risk of any token that you're actively holding, I couldn't tell you. I don't know if you could tell me. But no one's talking about this. There are other risks that no one's talking about that I think just need to be conveyed. For example, a lot of the treasuries of token foundations have multi-sig wallets, which means that there's a number of signers that need to sign off on a

transaction for that treasury to actually move money. But the problem is, no one is tracking this and no one knows. Certain wallets, I'm not going to call out particular tokens, but one token that we were looking at this morning, they have 13 signers on their multi-sig, but only three need to approve a transaction, which means that for this particular token, if three people decide to be bad actors, they could totally siphon all the money out, and no one would know, and no one's talking about this. I think if we really want to achieve broad adoption, not only do we need to have the education, not only do we need to

explain what a multi-sig wallet is, why it matters, what are the implications of this, but we also need to aggregate that information in a single place. We're talking about all these ideas like developer activity, chain data, social sentiment data, news, and market-related risks like VAR and all these different things that needs to be easily accessible for somebody in a single place, or how are they ever going to be able to easily build conviction on the asset? Everything that we're doing, I think the most bullish piece of news that just came out is BNY Mellon officially launched custody today. That is awesome. One of the biggest pieces of

feedback that we get from institutions is, I don't have a qualified custodian. Now you have BNY Mellon, who costs these $20 trillion in assets, and is probably already in some way costing a piece of your other assets' exposure. I think it all comes down to, let's put this industry in English for people. Let's explain it. I think it should be so exciting for people, because who gives a shit if the assets actually have any fundamental value? If you're a fund that's trading the asset, there's so much opportunity in that traditional assets have what's called alpha decay, which is this idea that when you're trading equities, if you're looking at a particular signal, that signal has probably been accepted by

thousands and thousands of firms throughout the world, which means that the value of that alpha, the signal, decays over time. In crypto, all of these things that I'm proposing, you guys probably haven't heard a lot of them, or you may have heard of some of them. They're novel ideas, which means that there isn't alpha decay, which means that you can go trade on some of these strategies now and probably make an ungodly amount of money. Granted, there's capital constraints on those strategies. Maybe you can't do them with $500 million, but you can do them with $50 million. I think that's really exciting for bringing large institutions into the space.

It's like, hey, this is a totally novel market. Let's put it in English, because there's so much more money to be made here. Maybe it's not on 20% of your AUM, Maybe it's on 1% of your assets that you have. But this is totally an untapped market. I could tell you with certainty that 40 of the top 50 hedge funds in the world are in crypto or actively getting into crypto. It's so many more than you think it is. And they don't necessarily care about the longevity of these assets. They just care about making money. So, it sounds like we obviously saw in 2016, 2017, the massive arbitrage opportunities that people were taking advantage of. I mean, Bitcoin was literally $3,000 more expensive than South

Korea than it was in the United States. Those inefficiencies are largely arbed out with time. But it sounds like there's still some massive inefficiencies as far as the data that people are consuming and the fundamentals that we're talking about, where someone who really digs in and understands this can have a massive edge that, to your point, doesn't exist in other markets. Yeah. No one is talking about this stuff. No one had good unlock data. We have it now. There's got to be something there. The most sophisticated funds in the world are going to figure out, signal lies at the intersection of a lot of different data points. If you look at one metric in isolation, you're going to have a ton of noise. But the way that people are going to find signal is by thinking very creatively about how you combine this data. I think that's really exciting to folks. Look, there are a lot of crypto fund managers out there that did really well over the last three or four years,

where they had no competition. I don't know if I necessarily want to talk about anybody who's not publicly in crypto yet, but I think it's public now that folks like Citadel and Two Sigma and others are in this space. They are incredibly sophisticated. Them and dozens of other firms are going to be able to just find signal and take existing models that they have for other asset classes, which is why the explanations really matter and apply them. Right. You mentioned something earlier that I want to touch back on, which was creating a taxonomy for these assets, which I think is perhaps the most important thing that we lack.

How do you define, put these into buckets? How do we create that tree so that people understand exactly what they're investing in and what's worth comparing. What's apples to apples and what's apples to oranges? Yeah, no, I totally agree. We've built it ourselves. I don't feel like I need to control that data. I think that's a commodity. There should be a publicly accepted... We're happy to present ours if that's helpful to the market, but there should be a publicly accepted asset taxonomy. We should know very clearly what a throw asset out there is. What is the sector that it fits into? What's the subsector that it fits into? What are the layer ones that it exists on? Because I think at the end of the day, when you think about investing, you should be like, I want to own the biggest...

Let's say you're a bull on Solana. Well. You should want to own the best DeFi asset on that chain. I think we need to start building this categorization out because people aren't going to be able to make sense of the market if they're just being like, oh, I'm going to look at CoinMarketCap and try to figure out off the top of my head which of these 45 assets I should compare to one another because it just doesn't make any sense. We also need it to build thematic indices and things like that in the future. You talked about risk management. And I think, obviously, in equity markets, you can very easily manage risk, understand what's out there and the potential problems. How do you price in risk in crypto when you have a model, but then a simple hack or exploit

completely wipes your entire account, and it's something you couldn't have accounted or planned for or prevented yourself. Yeah, look, I think that's partially why folks that are coming into this space that are larger are focused more on off-chain trading, where they're not necessarily engaging on the blockchains themselves. I think there's other problems with engaging on chains as well, as it relates to the fact that if you're a large institutional investor, you don't want to be trading with Iran. The U.S. government would not be all that impressed with that. I think there's a lot that has to go into figuring out on-chain. I think a huge piece of it is going to be the compliance aspect and who you're actually

trading with. But I think we should be thinking about a lot of the market data-related risks as well. We should be thinking about, for example, if an asset was to have a three-standard deviation bad day, what is the drawdown that that would have on my portfolio? And how does that compare to a comparable asset? And that's where the taxonomy comes into play. If we're thinking about investing in layer ones, and let's say, all things considered, you're pretty agnostic. You don't really care if you'd invest in Avalanche or Solana. Let's just say, you just want to have exposure to one. Well, then, that's where you start looking at the market data-related risks. You look at, what does a really bad day look

like for one of these assets? What is the drawdown? How correlated are the assets in my portfolio? One of the things that we're finding, which is shocking, is, we're talking to funds that are claiming that they're market neutral, but in reality, they may be long an asset that has a really high beta correlation to the S&P. In reality, it's not actually market neutral. I think you need to start building out factors and risk factors and risk models to try to assess what is even the market-related risk. That's something that exists in traditional markets. I think if you went to most portfolio managers in crypto and you asked them, what are the

risk factors that you're considering in your investment decision, you'd basically get crickets. I think that is changing now. The crash of this market and LPs, like investors in these funds asking questions, is going to change that. But on the smart contract-related risk side, we need to be tracking a lot of different stuff. Who the auditors are, I don't think there's been enough conversation about who does a good audit and who doesn't. Which percentage of, you know, like, for example, take auditor A, what percentage of the time when they audit an asset does it get hacked? If the answer is, it only gets hacked half a percent of the time, right, then I can have a lot of conviction in

that underlying asset. So, I think those are types of things that we need to be considering. Also, like, when is the day since one of these, Also, when was the last time one of these assets was audited? And what changes, if any, were made to the protocol since that last audit? Because that's when risks can arise. There are a number of really good audit firms in crypto where the reason that an asset got hacked is because they rolled out some upgrade to their smart contract and they didn't want to pay for another audit. That's where the risk lied. I think we need to get that information in front of investors. I think, look, you just need to accept that

there is going to be some level of risk that exists in this space. There's so much risk that exists in this space. I think we just need to price that into how we're thinking about assets. I guess that would in this space. I think we just need to price that into how we're thinking about assets. I guess that would be my answer. We're talking about how to look at the fundamentals of the crypto space and how to really quantify and value these assets. But you brought up an interesting point, which is correlation. Obviously, now, we're in a place where the entire crypto market and Bitcoin are correlated to the S&P and global markets. But even when that

wasn't the case, altcoins and everything in the space was largely correlated to Bitcoin. A big Bitcoin move destroyed everything indiscriminately all at the same time. How can fundamentals be important or even matter if everything is going to move together in massive waves? Yeah, I think there's a really important distinction here, which is one asset could go up 2%, another asset could go down 2% every day, and they're 100% correlated. Correlation doesn't take that into account. An asset could go down 3%, another could go down 5%, and they could be entirely correlated. But look, I don't think fundamentals are broadly accepted yet. I think we need to get to that point. I think we need to be having these discussions,

and I think there are conversations. I think we need to do some backtesting on our assumptions, as opposed to just throwing ideas out without testing them. But I do think we're starting to see outperformance and underperformance. There are tokens that are down 70%, and there are other tokens that are down 97%. Yes, they both went down, but there's a really big discrepancy and difference in how much those assets went down. The difference between an asset going down 90% and another going down 99% is that one asset went down 90%, the other asset went down 90%, and then it went down 90%. There's a big difference. I think that's where that taxonomy

comes into play, where we start to figure out, OK, I have conviction in this sector, in this market, and after all these incentives leave and they dry up, where are the users remaining? Where are they? And is there a reason for me to hold the token, or does the token not actually confer any value to me? I think we'll start to see that break up. I think bear markets are the best way to show winners and losers. Are there any final lessons that we can learn from equity markets and existing markets that need to be applied to the way that we view crypto in the future and the way that we value it? Yeah. I don't know if there's anything in particular. One thing that we've seen

in equity markets is, investor emotion is still important. It's something to be very aware of. I think right now, we're in this really risk-off environment with everything that's happening with the Fed. But I do think we need to understand that humans are humans no matter what asset they're trading. Anything that we can do in terms of thinking about human behavior, another good example of this, which is quite interesting, I've proposed that tokens should be doing token splits. There's been a lot of research in equity markets that doing stock splits actually lead to very significant outperformance. I don't know what exactly the number is, but there's been a ton of empirical research on it.

The average stock split leads to a stock outperforming the S&P by 17% in the next year. If we see something like a token split, when a token goes from, hey, the token's $100 to, I'm going to give you 100 tokens and it's $1, we can learn from that. I think as we see things popping up in the crypto market, what we should do is try to figure out what are the lessons that we can learn from other markets. What are the lessons from Pets.com and what does that teach us about an asset in this space? What are the lessons from anything that's happened over history? At the the end of the day, this isn't novel, it's another

asset class, and investors are going to behave the same way, no matter what it is. So, look for corollaries, because they're always there. Well, thank you so much for your time! We actually somehow ran over. That went by extremely quickly. Everyone, check out Josh Frank, please, and his company, The Tie. They're really doing incredible, incredible things. Thank you so much for taking the time again! Thanks for having me!