Topic
Crypto & Web3
The state of crypto, DeFi, and web3 investing.
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There's also Twitter, which is wisdom of the crowds, a collection of people that are just constantly staring at blockchain related data and identifying anomalies and raising their hand and saying, hey. This this doesn't look right. And then there...
Why is this happening? What are the benefits of tokenizing things? Tell us about this trend. So first of all, I think real world assets, I'll call them that for the purposes of this conversation. I think they're the key to the long term success of...
I suspect that 98, 99% plus of the blockchain applications, the DAOs that exist today are not going to be around long term. It's extremely challenging. And in some ways, governance and human involvement is almost a bug. It's not a feature. You want...
But as that business grows, they delegate more responsibility to others. There may be a board, there may be venture capitalists. Decision making is more decentralized. Ownership is more decentralized. Through that process, things may move a little...
You touched on this idea of kind of security tokens with gold and Amazon stock. Where are we in terms of, call it, traditional assets being either traded or lent against in the Web3 world? So zooming out, crypto today is about 20 basis points of all...
Would it still continue to accrue cash flow earnings? Or is it reliant on people? Because if it's reliant on people, there tends to be more challenges with that. And you're taking a different type of risk. How do you think about the underwriting...
validating that Ted owns those tokens and Ryan exists and validates that transaction occurred through consensus. But for you and I, Ted, to build anything of value outside of creating tokens and moving tokens, you need to bring reliable data into...
So in a world of blockchain where code is law and these instruments are all bearer assets and there aren't the same rights and remedies you'd have as a lender or borrower in a chapter 11 bankruptcy, there's very little recourse. And so people have...
And with respect to what types of insurance policies should be provided, if the DAO should be paying anyone, any fundamental changes to the protocol need to be voted on by NXM token holders. So anyone that owns an NXM token is theoretically part of...
And the problem is that many regulated institutions cannot interact with blockchain applications today due to compliance and regulatory reasons. You don't know who your counterparty is when you're interacting with a smart contract. And earlier this...
and new types of things to own, new types of networks, right, like network tokens, like, that we've talked a lot about. That's kinda like the most exciting thing to me. Tokenizing a company and putting it on chain is maybe only incremental...
There's a whole range of different things you can do with stablecoins on chain, and these really started in earnest in, like, 2020 in the early days of Ethereum, where we realized with these smart contracts, you could basically embed if then logic...
And everything underneath the is crypto, but you as a user may not know. Right? And so we started to see a lot more, you know, push into in into having and and creating protocols and and applications like that. And so that's where we're really...
using, you know, tokenization. I and I don't know how the specific company works that you, that that you message, but, I I don't know if that necessarily is where I see, you know, a use case for data. What we what I do believe is true is that we...
To use that comparison in the stock world, we've had instances of, say, the shares outstanding of a company being some very, very high number because people can rehypothecate the same stock over and over and over again. How does that work in the...
In addition, you look at the integrity of the smart contracts and code that's been written, and you vet that. And then the other point that I think is sometimes lost is most of these tokens are claims on cash flows. We think about them that way....
You could embed a smart contract in to manage the interest rate swap so the issuer steps out of the equation, and now you've got, like, the bank managing the cash flows directly to the investor or who is managing that that swap. And then you don't...
So really DeFi scaling is in my mind a D to B to C distribution model, DAO to business to consumer. You need that kind of layer in between, not dissimilar from email. When you send an email, no one thinks about using SMTP. You just use Gmail or...
So the concept of people downloading self custodial wallets, writing down 12 word seed phrases, understanding gas prices, and then being able to make risk assessments around which DeFi applications are safe or which ones are not, that doesn't scale...
We've decided on a global scale that, like, money laundering is a bad thing, And we don't want criminals, terrorists interacting with the financial system. So there is a trade off between just being totally open and letting everyone interact with...
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