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listen. Today we have something special
for you. We have a host Roundtable
discussion where Brian Federica Sunny mayor?
And I are going to reflect on what happened in the last year
and also make some predictions about where we think things
could go. From here, this is something
that you guys are listeners have asked us to do more frequently
and it's been hard to find the time to do these.
These hosts round tables, but I can promise you one thing we're
going to do them more often, we're going to try to do them
once a quarter and if not at least twice a year because we
really like doing it every time we do these, we have a great
time and this was no exception. So in case you haven't noticed
there's a pretty significant Bull Run happening right now as
I record this Bitcoin is somewhere around forty thousand
dollars and ether. Is it about 1,200?
So that is going to color a lot of this conversation.
And so we're making some predictions which is not
something we typically do on the show, but we try to make some
informed price predictions, at least and speculate on where
things could go from here. But to counterbalance, that
we're also talking about what all of this fervor could bring.
Terms of negative attention to crypto and how the system the
traditional Finance system and also governments and
nation-states, how they could react to this tremendous amount
of enthusiasm around crypto? One of the ways that governments
could react is by imposing stricter regulations.
We're already seeing this in Europe and also in some form in
the u.s. there is also the potential for stricter taxation.
On crypto assets. So we'll talk about that at
length before we go to the interview.
I want to tell you a little bit about one inch.
One inch is my go-to decks aggregator.
And I actually used one inch yesterday because I need to make
a little trade. And I was surprised to find out
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So, if you've been using one, And you used it in the last
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rocks /, 1 inch and have a look and see.
Maybe you've got some, maybe you've got a late Christmas gift
they're waiting for you. So with that, please enjoy this
conversation with all of the epicenter host.
So the first area that we're going to be discussing today is
on the market cap, or the price of crypto.
Currently, unless you haven't noticed the crypto has been in a
pretty significant bull run. These last couple weeks and we
have some predictions on. We're where we think things
could go from here. Maybe we also be interesting to
have just anybody, everybody like share a little bit about
like how their last year were also like yeah.
Actually. I'd like to start with that.
Good. Alright, let's go ahead and run.
Yeah. So you wanted to make an episode
today to like look back a little bit the last year and you kind
of catch up, you put on those few times in person around
conferences, of course. Now we've grown has been a long
time since we had a conference and so we kind of doing it
remotely and so we want to talk a bit about last year and like
all of the things that happened last year and I guess also
specially like our own the things we did.
Maybe that kind of impressed us the most and then talk about
this here. And you know, what's coming up
as we sort of, at the beginning of seems to be, I get another
pic. And probably crazy bull market.
Yes, I've had a bit of a crazy year.
I think, you know, I think someone was asking me about,
like, there's like something there was something that, like,
you know, a couple months ago, we were like some talk.
I was panel about like, you know what, it's been like working
through covid and how is like your work situation changed
during that and this was back when I was still a tender
moment. And you know, I was like well
honestly a lot of changes here but a lot of it wasn't from like
covid stuff is more just like other stuff that happened and so
you know basically for me personally I Left.
This is probably one of the biggest changes for me because I
left my first full-time job that I've ever had.
I was at tender meant for three years and, you know, working on
launching the cosmos Hub and conscience SDK and all that.
And so I left about back in like June or July and then from that,
I needed like a temporary break from crypto.
So I just started doing a bunch of random stuff, you know,
working on some web of trust. Stuff.
Working on some education stuff. I made a Twitter bot of myself
and then but you know crypto will always drag you back in.
And so I got dragged back in, of course, and just started working
on. So me and my co-founder day, we
started working on our validator company called sikka, still
running validators, but also just working on a bunch of more
development projects that we're pretty excited for for launching
in 2021. So, last year at Foster's, a lot
a lot. Work on on correspond was kind
of the main, the main focus and I think has been like it was
really great year. We started with your 70 but we
grew it to 12 people and there's the whole staking ecosystems of
course like Blossom. This well you know, so many
networks launching so much like Innovation happening around that
and let's be kind of like very cool to like help.
Many of these new networks, getting off the ground.
And then we've also done been doing some work around
interoperability. So, we did some work on Cosmos,
kind of a relative Cosmos substrate bridge.
And then we did some work on other kind of IEC.
We dated project. So we doing some work on a
sailor Cosmos bridge and kind of exploring like Solana
interoperability. So, of course, that's also still
very beginning where, you know, it's not yet really affecting
you. Not yet, been used but I think
in this next phase that's going to become a significant
significant as well. And yeah, this deal only thing.
Missing was, of course, like that in person team retreat was
work because we always say those, every three months you
went somewhere and that was of course.
After January, 1 year ago we didn't do any but now next we
did them remotely. But now next week we're doing
the first one in person again. So we Going all to buy and well,
everyone's coming but about half the company's coming so that's
v. D excited that get on a plane
again and like travel somewhere because I haven't haven't been
on a plane for almost a year now.
So you know like my I'm working with Brian on chorus one and do
most of my year was, you know, knee-deep in onboarding some of
these networks and last year, was the first year where chorus
felt stable where I am like no, no longer worried about the
company surviving, it's going to survive for at least the next
few years and it took us three years to get to this
psychologically complex. Dual point.
So if you really happy, I also feel blessed that covid did not
impact our business. Like we grew a lot.
Like last year, we on-boarded to be 10 you networks on a personal
front like something really interesting happened on the
regarding my body and physical well-being.
So in the, in the Christmas of 2019, I read this book or
lifespan by David Sinclair. I really recommend all the
listeners to You read that book. So it's a it's a book is
essentially about you know like the signs of aging and how we
may be able to control the aging process itself.
And so I read that book and it was a revelation and then I did
one of these tests which measure your biological age so how old
your body actually is as opposed to a calendar age which is the
number of years, you have lived on planet Earth And it turned
out that, you know, like, my biological age is 12 years older
than my calendar age. So, you know, I'm 32, but
biologically, I'm like, 44, and, and like this data is kind of
outside the norm, like, at the complete edge of the normal
distribution. So, if you gather like 10,000
people, the stelvio difference, I am probably like I have the
greatest difference between my calendar and biological age in a
sample of like 10,000 people. So, it was something really odd.
I discovered and it, and this kind of observation sent me down
a path of exploring, a lot of different things.
And so, one of the things I've done is like, I have done some
supplements and I'm done a lot of fasting in the, in the
previous year. And what I also discovered on
body is like, the way just started dropping off my body.
So I lost 20 kilos last year without even trying, just having
made some changes. So, I feel much more energetic
as well. So, yeah, 2020.
Brought me some deeper realizations about about the
body I inhabit and how to run it better.
So yeah, I'm so thankful to Tucson 24x.
Have have you done the second test on your bio doubt?
You could H. Now has it changed.
So I had decided I would do like these regular fasting for a year
and the supplements for a year and then do the run the test.
So hopefully I'll run the test again.
In February of this year, I'm not expecting my clock to be
very different. Because as far as I can see, we
don't know how to influence the clock.
The devel today and I am skeptical.
My changes would have done it, but let's see.
Brian you. Use you recently switched to
carnivore e. How is that going?
I was I just wanted to kind of like yeah, jumping because
absolutely. Yes.
I mean, I've I've always been interested in like diet and
passing for a long time and I've been on some sort of like paleo
Isha it for, maybe 10 years and, you know, probably like many
people. You've seen some of these like
carnivore. You know, on Twitter, right?
There's quite a quite a few sort of Bitcoin carnivores.
And so, yeah, I also saw those and it just seems like an absurd
idea. But then at some point I decided
to Actually like learn about it and watched a bunch of videos on
YouTube about everything books about it and yes II.
Then I tried it out for a while. 2019 and then actually felt
really good but been too kind of getting back to normal again.
But now I've been basically six months eating 90 is percent
carnivore probably but if you seek Anything?
So I highly recommend people and try it out.
It's I think the biggest difference is I notice is
there's no food cravings. This, you know, you see country
full and then you stopped like you can't video we eat and the
energy is much more stable. So you'd like kind of what does
it mean you don't eat actually vegetables and fruits or grains
or you literally just eat meat? Is that it So I eat eggs.
I do eat like so I do like some phases where I just eat meat
next. Some sometimes I eat some cheese
as well and I occasionally eat some fruit.
I don't eat any vegetables. I'm afraid to chase because it
like it tastes like I don't notice any it doesn't if I like
a little bit of like mango or something like that it does I
don't notice it - difference but it just it's such a different
flavor and taste that it's kind of you know you miss it.
So Brian's officially a Bitcoin maximalist now.
Yeah so I had a third kit this year so I'm still on the fish
fingers diet in terms of you know, professional staff.
We did a lot of things that gnosis this year.
So we launched the gnosis Dow. The gnosis save launch.
Gnosis say, if apps there's two and a half billion dollars
student in noses faces safes. Now, we launched, the gnosis
protocol, which is a new way of separate swapping assets, that
kind of uses the blockiness of blockchain to its Advantage.
We launched the a product Market framework that a couple of
Projects have built upon namely Poli, market and Omen.
We took over open etherium. So basically the the client that
used to be the parity client, is now operated and run by noses.
It's called open etherium and sadly.
We didn't get to hold a conference this year.
So we are planning to do a def con this year as well.
I'm looking forward to getting back to that last year.
Other than that, I did a decent amount of years.
Arming and kind of knee-deep in the defy.
Yeah. So basically that's that was
more or less my year. There was a lot going on and I
don't really see a debating the moment so happy that like the
Notions prediction markets, finally launch because I used to
joke that gnosis has built half the stuff on a theory, mm except
the prediction markets that they were supposed to.
And but it's like this year. They finally you guys finally
launched prediction Market which is really fun.
So basically prediction markets as most of you know is the
regulatory relief wrought topic. So basically You don't want to
operate a an unlicensed, friction market.
So basically, we tried to get a license for the longest time and
basically now that we have a license, it's kind of the ground
has changed so much that that a couple of fully decentralized
projects were actually able to build on the decentralized
framework that we had built. So, basically, we're not
operating license, friction Market at this point, but it
feels super good to actually have this framework out there
and have people build on it. And I mean, You can actually
launch your own prediction markets on ohm and and I think
the user experience is actually Way Beyond what anyone could
have imagined. You know, interacting with a
fully decentralized step would be like in the past.
Yeah, the guy pretty sure I saw, I like Polly Market mentioned in
like, mainstream news during like the election this year and
I like, wow, that's pretty cool that like funny the person.
If a dozen of people don't realize that it's built on noses
technology and people go like, oh, but you haven't launched any
prediction. A concise.
Yeah. But really we have.
Yeah. I didn't realize that they're
also saw like the headlines about pulling market for the
achiever cassette. No idea.
This was built on on the gnosis. Yeah, it's another stack.
So we've built a lot of infrastructure.
Cool huh. I guess I'll go next.
Well this year it's been it's but I think it's been really
fascinating. Your lots of really positive
things happen. So, on the epicenter side, I
think, for me, it was a year Of in some ways, provoked by covid
is to make epicenter, much more leaner as a company.
And I think in many ways we've been able to do that and just
have the company run on a much more leaner Pace.
But what has occupied a lot of my time this year has been
working with a then we had someone put a hoe the president
on a couple of months ago then as the association for the
development of digital assets here in France and that's been
extremely positive on a personal level but also just, you know,
the accomplishments that we've been able to achieve their, I
think are like really, really great.
So we have like, over 50 members now and what's what's really
encouraging is to see this initiative.
Now, go to the EU level, as many of you are aware, I'm sure our
listeners. I mean, there is crypto
regulation coming both in Europe and in the US and at least here
in Europe, there is there isn't or there wasn't Strong unified
voice representing the entire crypto space, the entirely
European crypto industry. And so this initiative aims to
fill that void and to have a more unified voice in you know
in the face of these regulations that could be quite damaging to
the innovation in the space so that's been really great.
It's been great to kind of focus my my time and attention on
other things. I've been really enjoying the
work I'm doing there and you know start it started off as the
thing that I think I'm more comfortable in which is like
structuring you know all the all the things in the organization
and everything, all the tools that were using but now is
moving more and towards a advising.
A lot of the, a lot of the papers that were writing
bringing my own sort of Technical and privacy minded
touch to the position position papers that the adult is
writing. And a lot of this work is Is
also being used for the, for the European initiative.
So that's been really great. And I think with covid, I when
things started, when things started going remote sometime in
March, around that time, it was a really stressful time for me.
Like personally it was it was really like it was driving a lot
of anxiety, there was a time there.
I was like a bag of nerves and especially around the time that
we Has the reset everything. But then, you know, then when
things suddenly in the summertime kind of cooled off a
bit and it was able to go on vacation and like, take a
breather that was it helped kind of take some of that, some of
the pressure off. I've really enjoyed this year,
being able to spend more time on doing things that I like like
playing electronic music. For example, so you guys can see
this here but my desk is full of devices and things that light up
and instruments and things like that.
I've been spent a lot of time doing that.
And yeah, I'm hoping for 20 21. I want to what I'm hoping to do
is to be a little bit more because I've got, you know, my
eggs and different baskets is too little to be a little bit
more structured and organized and how I spend my time in these
different things and so it's like be a little more mindful
about about like time spent on different different Endeavors.
Oh, other thing to this year that that was really beneficial
and I hope to continue doing next.
But also is challenging crypto, because that's where most of the
information comes from is like, I really, I really turned down
the Twitter. I try to go in Twitter as little
as possible because that was also, I think for like it before
we were talking about, like, how much the phone brings anxiety
that? I think that was one of the
things that helped a lot. I actually tried to decided to
start going on Twitter more again because I feel like I so I
started like I started this whole like geography thing
because I was like there's too much crypto stuff on my Twitter.
I need to think that's the thing that I appreciate the most about
my Twitter experience is reading your geography treats.
Yeah, yeah I know this is all your your Twitter fault is
amazing. No not to put her best to me so
it's something else. There's a lot of geography and,
and the Twitter bot is so good that sometimes I don't know
whether it's the real sunny, or the Twitter, but I was thinking
of like making the profile. The profile pictures are
different right now for the coup de robotics my like epicenter be
like, blocky picture, but I was thinking if I make them the say
that'll really confuse some people.
Yeah. So you're going more in Twitter.
Yeah, I was like, you know, I feel like, I feel like one
thing, I like toned down a little bit of, I've been a
little bit less vocal and, like, I feel like I want to get back
to being more vocal like, you know, I like sharing my thoughts
and on stuff. Like so I have like, you know,
and also just like writing more. So, like at the beginning of the
year, I was trying to write more like blog posts and stuff and I
kind of like paused from that up and then I'm trying to get back
into that. So I have like, you know, after
that, after the episode, we did with Martin on circles, I like,
have this, like blog post. I've been writing about circles
and like, and I have a couple more blog posts, like, in the
works that I want to like publish and I feel like using
Twitter as a good like, you know, drafting board because I
think some of my like better blog post actually came from
being like Twitter, tweet storms, that then I turned into
blog posts. And so I don't think I've done
those kind of like tweak storms in a while.
I think I think what I need to do is just unfollow everybody
and then start again from fresh. I think I just I think I just
follow the wrong people. That's the problem.
You can also keep following them and press show me less of this.
Yeah that that also helps perhaps.
Maybe you guys need to train me? I coach me on my, on my Twitter
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podcast. Yeah, let's dive into to these
predictions. So we all agreed that the first
thing that was on, everybody's mind that we would want to talk
about is the current bull market.
And so we're going to talk. We're going to give our
predictions about where we think the cycle could take us and I
think mayor and Brian, you guys had some pretty accurate
accurate price, predictions precise, precise number First
like big number go up as a thing as I was like, kind of like read
them roughly but you know, my here claims that the total
aggregate crypto market cap will rise 15, XO approach fifteen
trillion with in 2021 followed by a 95% crash at some point in
the following years which is interesting.
And then Brian claims that he believes Bitcoin is becoming a
recognized asset class and will reach about TK by the end of the
year and then he added on. At the end the theater will
reach 15K by the end of the year.
So I do really want to like go ahead and like give the defense
of your prediction to start with This is an irrational Market,
it's a mad market and like prices.
I mean there are no fundamentals in crypto so prices cannot
really go beyond fundamentals but they have having lived
through like to to crypto bull markets.
One gets an appreciation of how crazy crypto bull markets get
and I think I personally think this is the 2021 is the big one.
We're like this bubble will become bigger than the The what
the.com bubble was in 1999. And why, I think this will be
bigger than the.com bubble, is that, this is the first post
internet technology bubble where the information transmission has
been accelerated by the internet and in crypto, the Speculator
Trader Market is much much larger than, then the.com
market. So it will be a bigger than
the.com bubble if you think of the.com bubble.
That's around 10 trillion when adjusted for inflation.
Nation. And what I'm claiming here
really is that we are going to enter into a bubble.
That's larger than the.com bubble.
And then once the bubble bursts the calm down is yeah, is going
to be as as drastic as the.com bubble.
So there I think the app the market lost, 96 percent of the
value. I think something similar will
happen to crypto. So it's going to be a crazy
ride. So what I have is like, you
know, do you think this will, you know, you very specifically
said the market cap of crypto rather than like any specific
coy. So do you think this will come
mostly from like new assets or will it come from a price
increase of existing assets or obviously will come from some
combination? But what where do you think most
of the value will come from? It has to come from a
combination, right? So, I mean, I'm saying it's
like, Rising 15 x, right? So Bitcoin will rise, but it
won't rise. 15 x. It's going to rise a little
less. So, you know, like 9x or 10x if
helium, probably will rise like 15 x but then there'll be other
coins that will rise 100 x, 150 x and of course, will be
completely new coins that will pop out of nowhere and have like
five billion dollar market caps. Yeah they'll be a coin that's
like 3 months old and has multi billion market cap.
All those things are going to happen and the aggregate Market
is going to be like 15 times higher so I don't know how much
like value Bitcoin captures versus the other things.
This is interesting actually listening to you because we kind
of makes me want to like almost like we think my prediction I
mean so I think one of the things that is going on like
right now it's just that it's becoming like an asset class
right where you have to use like hedge funds that you know,
buying a buying trip, do banking coin at the moment and I was
listening to this podcast, a few day elected week ago, that I can
really brought this point home where this was some normal like
non-fruit. We do financial markets
investment podcast and you know, you listen to the conversation
and they were talking about the price of gold and about the
price of Bitcoin. And you know they said I go-go
that Valley Less in the last while because Bitcoin are taking
market share from gold, you know.
So this is like the first time that I've heard kind of Bitcoin
become actually something that's like has a role in kind of the
larger financial markets. And so I think It's like
happening, we have been and you see all these hedge fund
investors. That's kind of been like the
first way. So now I think and then everyone
has to follow, right? I think it would be in their
Pension funds, I don't just be an in kind of, I don't know,
your 1% 2% 3% or something of like assets and so, I think, I
think you have that, and of course, we didn't have that with
with the.com bubble, right, where you had this, because this
was just Equity. Everyone is owning it Could be
anywhere, you know. Maybe it was.
So that's I think one thing that's going to drive just like
very high and it's going to be like a huge.
This almost Unstoppable shift and then I think if you compare
it with the got comfortable, I mean the interesting thing of
course, is that when you said adjusted for inflation but like
is that inflation is probably not like their actual inflation
is the money supply, right? Because if you look at this
chart gigantic inflatable, Action or decreasing the total
money supply with, you know, covid and, you know, already
financial crisis. And I think that's just going to
keep going and crazy Pace, right?
If you kinda just for that, and actually, I would think that
descriptor bubble should become much larger than the.com bubble
or, you know, at least maybe maybe relatively adjusted to the
money supply, the same level, but probably that would be a lot
more than 60 trillion. So it's kind of actually makes
me rethink this. Like, maybe this is going to be
even much more insane than like, yeah, I mean, II think you're
right. I agree that like, I feel
Bitcoin is actually found like a really solid product Market fit
at this point. Like, I think, I think it's
inevitable that Bitcoin like, because like, replaces digital
gold, and I don't know if told me my replaces goal.
I don't know if I'm like one year prediction.
I think it might take two more psych like, in this cycle, plus
one more, but I think Bitcoin will flip and gold within the
first within the next five years.
For sure. Yeah, I think like in the
current macro environment, I think that Bitcoin just really
has this like product Market fit.
It's like, you know, it's this is like thing going, the u.s.
well everyone's getting like airdrop money and there's just
like crazy inflation or like monetary expansion that's
happening. It's like, well.
Okay, now people have the means and the reason to just go buy
Bitcoin and I've noticed a lot of, like, a lot of normal people
just, like talking about Bitcoins now.
So, which is like, it's starting to happen again.
On this product Market fit idea. One of the things that I found
interesting and listening to, some of these kind of more
General macro. Finance podcasts is that exist.
It's really the only exposure that I have to, you know, people
in that world and it's to see how Bitcoin always gets grouped
with gold. And the sort of institutional
financial markets have clearly put Bitcoin in the in the store
of value, use case, like no matter what the crypto space.
Like Bitcoins use case should be if we should be payments as
should be, whatever for traditional Finance markets.
It's, it's clearly, you know, a store of value and I wonder what
that means for Bitcoin Bitcoin future and like how the protocol
might evolve or like, how that will drive.
Maybe like some technical Evolution the protocol.
Yeah, I mean, I always hate this term store value.
I feel like it doesn't mean anything.
I feel like a better, like, more precise term would be something
like a like a macro hedge asset, but that's what I guess.
That's what we mean. When we say store value and
everything stores value. But I think what it is is, it's
like, you know, it's a selling point game, right, where it's
like, currently everyone just agrees on gold.
As this showing point where like, if you want to bet against
the rest of the world economy, you buy gold.
And so that After showing point, which naturally, then like moves
counter to the rest of the economy.
And so I think that's like it just a selling point game that's
going to shift from gold to bitcoin.
And I find these are Financial shelling point games really
interesting because like one of my friends, he was working at
Jane Street in like, during the 2016 election.
And he was telling me about how like, you know, during the
election night. You know, they had a poker there
were playing poker, but on the TV they have this like two
screens open. There was one was the predicted
prediction markets and the other was the peso US Dollar exchange
rate because essentially all of Wall Street agreed on that
market, as the shelling point to play there, like prediction game
on who's going to win the election.
And so it's like it's crazy how much of like Financial like
markets is just like taking it. Like, you know, acting as pseudo
prediction markets, given the lack of like, you know, actual
prediction markets available, So can we then make a prediction
about the Bitcoin price on gnosis built infrastructure?
Absolutely. So I was going to do this
tonight, so I was actually going to make.
I was actually going to set up ready to Market on all of the
things we talked about. Right now, an omen, we can link
to it in the show notes. Speaking of the product Market
fit the next prediction I had there was that the flip earning
won't happen. I don't think that Ethan is
going to flip in Bitcoin, at least this cycle because I still
life painting. I stole that Bitcoin has this
Good fit. And I still don't know the
product Market fit of eat as an asset.
I'm extremely bullish etherium as a platform and I like build
on ethereum, but I don't really quite fully, see the role of e
in the system over time. Yeah, the narrative isn't as
coherent. So basically I think there's
different narratives as to what if your room is.
And yeah, I think that that's easier for Bitcoin because it's
kind of it is a meme and itself like gold.
Yeah, I think for me, I just think the fundamentals of ether
just aren't the same, in the sense that like, I think Ron,
the premise of eith comes from like, you know, especially as we
see IP 1559 Stuff and like you know, I switch to see proof of
stake. It's basically like trying to
tie the value of eat more directly to the product of a
theorem which is like this like decentralized computer.
But the problem for me is that I mean this will get into a topic
we'll get into later in the in the show.
But II don't think decentralized compute is a scarce asset.
Like I think that like if we want scalability we need
decentralized compute to become more Widely available and we're
going to see like a massive increase in like layer 2 and
like all sorts of things. And so if the essentials compute
is not a scarce commodity then I don't see why Ethan is going to
accrue that much value. Yeah.
So that's kind of how I see it. The alternative for my view
though is I think that there's this narrative that can be
played where, you know, Bitcoin is a another way of thinking of
it is, it's a fashion statement, right?
It's like if you want to hang out with a certain crowd and you
want to like show the certain message about yourself about the
type of person, you are, you buy Bitcoin, and you show up, you
know, like if you're, if you're really love eating meat, you buy
Bitcoin because it just like fixing with your persona, right?
I think like eith has the ability to find that sort of
fashion statement, where I think A coin is this very like techno
pessimistic worldview, where? It's like, or like it's a techno
right-wing libertarian fashion statement.
While I think aetherium has the capacity to become a more techno
Optimist like left-wing fashion statement.
And I think that I think that's like where it might end up
going. I love the misuse of the word
fashion statement here by the way.
So Sunny what do you think about the thesis that Bitcoin will
eventually moved etherium for security reasons?
I've had it happen. I the reason I joined Cosmos was
to build the application layer for Bitcoin.
Bitcoin is going to flow off the Bitcoin blockchain into many,
many chains. They that was the original
reason I joined Cosmos like three years ago.
I mean I'm but I that time I also thought Bitcoin is going to
be money. I don't think it's going to be
money. I think it's going to be you
know, just going to be the financial asset that we already
talked about. So I don't II really think
stable coins are really going to also eats lunch and I think a
lot of the premise of eith was like hey it's going to be the
money of aetherium but I think we're going to see that's not
going to be true. I think stable coins are going
to be the money of aetherium. I agree.
I also have my personal price prediction so it's somewhat in
the same vein but I think out of the top Crypto coins by market
cap, I think half of those will no longer be in the top. 10 by
end of year and a half that I kind of see dropping out Ripple,
not even sure why it's still there, cardano, Stella chain
link and the most controversial tether which also has
potentially enormous implications for the entire defy
ecosystem, and also the use case of crypto as money, because it's
the but by Market cap, it's by far the largest the largest
silver coin server room. But I think we all talk about
this later. Do you think u.s.
DC will take its place? I'm not sure.
Maybe I think something centralized will for sure for
the moment. So I don't think it's going to
be. I don't think it's going to be
die or something. Similarly decentralized.
But I think it's one of my, my later predictions about Facebook
and The dollar and so on. So I'd save it for later.
Well, it's a one of the predictions I have, which is not
contradictory to yours is. I said that Litecoin will stay
in the top 10. And I brought this up
specifically, because when we did our host episode 2 years
ago, Brian and I got into a mini debate about this weather.
Like when will be like in the same position as it like five
years from then, so it hasn't been five years since that's
what it's been two years and like going to still number four
on coin market cap. So, And I'm convinced a Litecoin
will knock a totally. You've been winning that one.
Like I said, it's all about shelling point and memes.
And and Dogecoin is like a big rally up, so that means also
making some kind of combat. Yeah, I think this this whole
like Digital Silver meme is going to be very hard to kill
and I think it's gonna always like continue to be there.
Yeah. Okay.
So me and maybe I can go to the maybe we have those next thing
something I wrote this is basically about that.
Okay? Now you have this huge bubble
and then what happens. What's kind of like to be Ons
from the system. And I I see kind of a bunch of
different stuff. So first of all, now you can
have descriptive businesses competing with like traditional
businesses and the crypto businesses are going to have
like some weird advantages, but also the hitch is going to be
different and not really fit into the like, the way things
are done. And so I think one big thing
will be like trying to reduce regulation to like protect the
king company Industries and to make it like like harder for
decentralized, social needs to compete.
So I think that's going to be one thing.
I think we also of course going to see this huge wealth
transfer, right? If this happens, right?
There's all these cryptic people going to get very rich and like
people with other types of assets, they're going to like,
you know, loose and to some extent and it's going to be very
visible. But I think a lot of these
people like on Twitter and on Instagram and you know you're
going to have like the rapper's in there and in the Lambos
already. And so I think it you have all
of That like in your face and then maybe traditional
businesses that are going like more under attack by crypto.
So I think this is going to be this backlash and one Avenue
where I could see this playing out will be with like taxes as
well, where you know, they did it.
So complicated. Love this cup, the stuff that
even if you wanted to like perfectly pay your taxes, it's
often not totally clear what to do.
So I can see going after I group the people for like tax evasion
and like, you may be requiring people to that disclose their
addresses to the government and then they run like software to
look at like all your transactions and kind of so I
can see stuff like that happened.
But I just think there's going to be like you know real much
deeper kind of Ask to try to add.
Can you be a little bit more specific of look?
What the type of backlash will be, you will come mostly from
like a government backlash. Or are you saying they'll also
be like a social backlash as well?
I think there's going to be covenants, backlash, but kind of
driven by it will have some public support I think because
people will, a lot of people would be alienated by some stuff
that's going to happen in equip the space by some people be
inspired and love it. Right.
But I think this also Don't be big people who live all is of
what this is, an artist Insanity here.
It is an, ER, his Casino. So we are already seeing some
stuff. I didn't, I think this was also
like that this treasury idea that you can't transfer or, you
know, you have to identify when you withdraw from her wallet if
you have to identify the counterparty and so like, how do
you deal with smart? Contracts are right that mean.
Anyway, this is like a direct regulatory it.
Act that makes it harder for a smart contract to compete with
its additional business. So I think we could see a lot of
that. And then, yeah, I mean, imagine
if your tax abilities, asks you, hey, don't you have to give them
like, all you could do addresses and then you and then they could
like I've always thought that taxes will be one of the ways
that you know you can go mean. That's how they put out the
phone in jail nose like the taxes.
But Brian. How do you feel about privacy
enhancing Technologies? Technology because basically in
the way you can actually you can build or, you know, you can
engineer your way out of this, right?
That's I don't know yet, but I think that's going to be kind of
one of the battle lines, right? Well, of course people then I'm
going to get more privacy Centric stuff and like some
people will use it or just phone.
So I think that's going to just become one of these big
Battlegrounds in that I could see.
They're also being more of a segmentation where you're going
to have like no regulated crypto and then I mean we saw that even
I think that Sneak a peek over fine for violating sanctions
law, even though it's sort of like a nun hosted wallet, it's
multisig wallet. So if you are yours is non-host
about hosted wallet, but I think they got some fine because it
was some people in Iran or some some sanction country using it.
And so now they're okay, they have to say oh we have to assert
yourself more. Make sure nobody's touching that
And so I could see this sort of segmentation of the industry
into a more of a regulated and then more like offshore
unregulated part. I totally agree with this
prediction and it really overlaps with some of my
predictions. I wanted to bring up later on
and I think that the regulatory aspect.
So a couple things of Taxation aspect I think is is clear and
at least here in France, we're already seeing some version of
that. So when you file your taxes in
France, you have to declare all Exchange accounts.
In fact, you have to declare All Foreign financial institutions
where you have an account and so crypto exchanges are usually
Part of those and I could definitely see that the way that
government has been forging policy here.
I definitely addresses being one of the things that's required to
disclose in the next couple of years and then just on the on
this idea that you're part of crypto would be regulated in
part. May, you know, stay outside of
the regulated space. I think the, the mica regulation
makes it pretty clear that, that is what could happen in, in the
mica regulations, for example, privacy-preserving, Is our are
forbidden and so privacy-preserving, Koreans can
exist. The, the simply can't exist in a
regulated space. Now, with regard to other coin
other types of use cases, like, like, stable coins, Etc.
There's also some question there about whether or not those could
exist in the regulated space and if indeed, there are some crypto
use cases that are regulated and some which are not.
There could be sort of this as you describe it, read like the
separation or what I call like a schism.
Were part of crypto exist in the traditional sort of linked or
somehow tied to the traditional Finance space is regulated there
on ramps Etc, but part of crypto exists outside of that.
And then there's you know, you can extrapolate from there.
It does that mean that there are companies exist solely in that
market and does it create sort of like a sort of Shadow economy
where it is all kinds of other businesses and activities
happening, but that never interfaces or rarely interfaces
or where it's very difficult to interface with the with the
traditional Finance space. The shadow side will probably
exist in this case. But do you think it will be a
big space or no, because like, the current premise of defies
that eventually, this stuff is supposed to interface back with
like normal people in the real economy at least in my opinion.
But if that if that door is closed, and would you think that
like the shadow side will basically like you know, go back
to like twenty Thirteen Days like yeah you can use it for
darknet stuff but like that's about it.
It. So currently like the wild west
of defy has this like at least public State, like view of like
a eventually. This stuff is going to be used
by normal people but if regulation comes in like clamps
that down, will the wild west like disappear or will it
continue to like grow despite their?
Let me throw the question that I got you.
You know, let's let's let's assume that Mica goes through as
it is today without any without any modification.
I'm not so familiar with the The with the u.s. crypto regulatory
proposal, I've heard that it's a lot more open to Innovation
etcetera, but let's let's just let's just presume that like,
stable coins are illegal or the staple coins exist outside of
the regulated space, then that means that exchanges won't be
able to list them. Then it's really up to
interpretation whether or not exchanges can deal with coins
that have also interacted on Smart contracts, you know, where
the exchanges be able to, to You've liquidity from coins that
have went through like the maker smart contracts, for example, or
this sort of thing. When you say exchanges, you mean
centralized exchanges? Yes, Central exchange regulated
exchanges. So basically in, in a way I
think this cut actually comes down to being a philosophical
and historical problems. So basically what good are laws
that you can't enforce where basically, you cannot make sure
that a law is abided by I think those Those are laws that kind
of get overturned or repealed by history itself.
Well I mean I think the question though is yes.
So like with dex's and stuff you can skirt the law but I guess my
question is what percent of the population do we think is going
to do that? Well, I think it's a very low
percent of the population. I think if like if these things
are meant to be, if the vision for defies that defy becomes the
the underpinnings for Ensign where markets are able to
operate and like, things that we already know, and that already
exists, like, Commodities, markets, Etc.
Like just the stock market and all this can exist on defy.
At least the way that Mica is worded.
It definitely does seem as though they are trying to bring
the parts of defy that already resemble and mimic traditional
financial markets. Things like you know Securities
things like electronic money. They want to bring that into the
traditional Finance system and have that be regulated, but all
this other Innovative stuff. I call the all the the D gen
stuff, definitely exists outside of of the regulation and there's
no room for it in the regulation.
And so, I think that and I certainly hope so.
And that's the work that we're doing with our initiatives.
Is that the regulation leaves room for more Innovation?
But as it's currently, drafted, it closes very many doors.
So do you think will people be willing to I guess it's like a
cultural thing as well, right? So don't it'll probably change
from like country to Country like what one obviously the
regulation will change country country but also just the
willingness to break rules probably changes from country to
country as well. But also the acceptability of
breaking rules. Right?
So basically I remember when I was a kid and basically content
sharing started and you had Napster and, you know, all of
these kind of services. I remember they ran these ad
saying, you wouldn't download a car and I know that basically,
with my generation this that this didn't resonate because
basically, it didn't feel like downloading a song was morally
wrong. I mean, look what happened?
I mean, people don't Really by entire records anymore.
People now pay for streaming services and this is how this
monetize and through you know, advertising ideas and so on and
arguably interacting with privacy-preserving crypto is way
less enforceable than punishing. Someone for downloading a song
on Napster. So I think in a way the law
doesn't stand on its own but it kind of mimics what people feel
is, right? And what is wrong.
And I think that understanding is just going to change over
time. But anyway, isn't that actually
the music piracy is basically dead now, right?
Like, I mean, no one, you like Billy?
Anyone Pirates was it's all Spotify and you can think of
that is sort of like the, you know, you have the traditional
music industry with their like selling CDs and you have this
like this radical thing of like piracy and then you found some
synthesis in like Spotify and so like maybe the everyone that be
what happens here as well. You have the traditional Finance
industry than you have this like crazy defy thing and then we're
going to find like some synthesis in Like regulated
defy. Yeah, I think that's reasonable
and very 95 will kill piracy just like Spotify killed the
music but but only if regulated defy Isn't So heavily sechrist
rated that, you know, it doesn't really qualify as the real
thing. Yeah.
Just as with with dismantling of the the music industry but also
like the movie industry to some extent like I think that we will
come to some Some kind of middle.
And but you know where where the cursor stands in terms of what
that middle looks like, I think is, is really an unanswered
question at the moment. I think like one of the most
compelling things for me about defy over traditional Finance is
the ux of it. I think the ux of it is like
what's really nice? And I think you could say the
same thing about the piracy, like I think the ux of like
Digital streaming, it's just way better than going to buy CDs.
And so regulated, defy can like provide the ux benefits over
traditional Finance, but I think it's an actually follow, you
know, through the course of this conversation.
I think I've actually been like I'm Now, does need to the music
industry. I really think that like,
regulated Defy is gonna probably like wipe like wild west ephi,
once it provides aux features too.
Like normal people. But only if you have things like
stable coins, for instance, I mean basically and privacy
preserving coins and so on. So I feel like if the thing that
is then called regular times, I don't think normal people care
about privacy. I think normal people probably
don't care about privacy preserving coins and stable
coins will exist. I mean, it depends on how they
exist of all, we'd be more regulated like, you know, maybe
it has to be issued by a bank and stuff.
But I think that my claim is that normal people don't care
whether it's issued by a bank or, by like Circle, you know,
they just care. That is Under ux is as nice as
like it currently is. I think that's all they care
about. I don't think they care about
privacy. But I mean, the user experience
is pretty okay right now on defying.
It's only going to get better, right?
So why would people kind of leave the wild west to start
with? Because the regulation will
decrease, the ux of wild west defy and make the ux of
regulated D5 better because with the pirating, music, you always
get those, like, dmca complaint. Every time you pirate, then
that's like, that's sort of a, you can think of that as a
negative u x component, right? And so, I'd rather just pay the
eight bucks a month to Spotify, get as good of a street of ux,
as probably better than pirating music.
Yeah, I'm just questioning how good the ux under Micah would be
Yeah. I mean on the topic of stable
coins, I think it's worth noting that at least in Europe, the
European commission is considering crypto euros and I
don't really have well-founded but on this but maybe this is
something that we can launch into into some some debate at
some point. But I think that generally
there's going to be an opening up of currencies are in the
future are no longer monopolized by countries and by like Central
That's right. So I think here in this rundown,
we're talking about the, the Facebook, Libra and initiatives
Etc. And so I think things like Libra
are going to exist and they're going to exist alongside things
like a digital Euro or crypto Euro.
And that is a power shift that resembles the power shift that
we saw with the music industry and the movie industry, you
know, 20 years ago where highly centralized power in those.
Industries was broken apart and now exists in all these digital
startups like Spotify, Etc. We may see a similar, sort of
disruption, of the of the power Monopoly around.
Currencies to favor, private currencies, like the Libra and
others. I don't know if this is
something you, you guys have thought about too.
I think government's going to fight tooth and nail to protect
their power here and I think will be very hard.
I'm not saying that I'm going to fight but yeah, the record
labels didn't have power of taxation and a military
governments do. And the one thing that they care
about above all else, is to maintain their like monetary
dominance. And I think that like, they will
fight very hard to prevent someone from trying to disrupt
that I agree with you sonny and I think in the end, they will
fail. And I think that's in
retrospect, that's going to be the pervasive Paradigm Shift of
our times. Basically Powers diverted away
from nation states and two companies or other collectives.
Why do we think this is the case?
Like, what, what are the triggers?
That's going to make that the case.
Like, you know, historically we've seen a continuous increase
in like state power. What's gonna be the cause of
this reversal? I mean, it depends on which
skate of History you're looking, right?
I mean basically the Roman Empire collapsed and very Vino
State pie up our very much request.
So I don't think that's not possible.
Anymore laws are only good if you can enforce them.
And this is kind of segueing into our regulation part of the
conversation. But so basically, this was, this
was my one prediction on regulation that I actually
alluded to earlier, namely that If you look at the way that the
Facebook proposal for Libre has moved.
So in the beginning it was a basket pegged to babies.
Basically it was a coin paektu, a basket of different acids and
under us regulatory pressure that has kind of switch to a
u.s. he backed stable coin, right?
So I still think that despite the fact that that is probably
the best deal that the u.s. can actually get right now.
I Think they would still clamp down on this and I think
Facebook will lose in this instance and I think Facebook is
very much on a path to demise anyways, but in its wake.
I think we will see a stable coin that is global and basket
packed and that will merge into the mainstream.
And that will be said set up such that it will not have the
same regulatory exposure as Facebook and I think this will
Herald a couple of This one being the end of the global
dominance of the United States because that is in essence,
based on controlling the supply of, you know, the world's
Reserve currency. But I think this is also in the
widest sense. It's also going to mean that
nation-states will become less powerful and I would actually
argue that nation-states at Peak power right now.
And I think that corporations and possibly later dowels and
other sort of of schemes will kind of take that place.
I very much agree with that. I think this is like missing
parsley, like the cyclical Network effect of the US dollar.
Like it seems like your claim here is that the u.s. power
comes from the dominance of the US dollar, which is true.
But that also is a feat. The other direction as well.
The power of the US dollar comes from the power of the US
government. Like the entire petrodollar
system is built on that like I do.
Of like, you know, the US military will enforce it.
And so, you know, the reason, the u.s. dollar is the, like,
Global Reserve currencies that you needed to pay for oil.
And when you stop someone from try to, if you try to pay for
oil or something else, the US military will come and invade
you. And so, it's like, we need to
see like, what is the? And you can see what the path is
to an alternative. Well, what One path is the
decline of the decline. In the demand for oil, let me
that's one path. I mean, I do Have a specific
information, we have countries like you're wrong, right?
That are basically locked out anyway you know there are good
you know they can use some help it coin right wing sauce on use
there and then I think you have other countries you know like
China like we should be a big oil buyer.
Like do they care about like protecting US dollar?
I'm not sure. But so try those not going to
push China going to push the you on, right?
Like you know what China is doing right now is they're
building like they have a viable strategy.
G2 building a reserve currency. What they're doing is they're
going to have a country and like, saying, hey, Will fund
your ports as long as all imports and exports from here
are denominated in RMB. That's like a viable path.
Yes. But I mean that, that actually,
that puts pressure on the dollar, right?
I mean so basically that that fragments the system even more.
Yeah, exactly. You're going to have a day so
you can base it. They say oh, you know get yarn
from China or like you can get like maybe do something with
Bitcoin with Iran and then definitely will.
Be others that are also like like Russia.
I'm sure is going to be happy to do deals like outside of the
dollar system. So I don't think that they're
going to the military is going to be able to sort of like
maintained its dominance of the dollar.
I think there is a big selling point around the dollar, right?
Where everyone keeps their accounts and Dad and they slowly
quiddity in that. And I think that's, of course,
going to be more sticky, but in the ain't, I don't know about
the dollar I would, Still some ways away until we are going to
see two dollar kind of lose its status.
I would guess that's not going to happen in like this bull run.
But you know maybe 5-10 years. Maybe I can, I can step in like
when I hear all of you talking, I think I would like to actually
someday categorize your predictions into, like a
framework. So you think of state power,
like the, what does the state want State doesn't want.
One thing, it wants multiple things, right?
So maybe it wants to preserve, its monetary sovereignty over
their own population. Meaning US Government wants a
optional transaction US dollars, so that's one thing they want.
The second thing they want is tax collection, which is making
tax evasion, really hard. We have tiptoe.
The third thing they want is which is like preserving the
market structure, right? Which which is like the SEC
wants that. If there's a crypto coin,
there's no information. Asymmetry vis-à-vis, the crypto
coin. So they want to preserve Market
structure. And then the ID for thing is
they want surveillance. So we'll is comes in move from a
law enforcement so it could be that the government wants four.
Things four major things. We can identify a different
number maybe in the future, they will get some of these things
from crypto, but on the others, they will fail to get what they
want. So, you know, the you could
imagine different Futures. There's one future in which the
government gets their surveillance capability.
So they're able to surveil everything way.
Better than area, I will today we are crypto, but Lose their
monetary power. I mean, the coins being
transacted and not US dollars, but they are servile really
well. That's one kind of future but
the different kind of future is they preserve.
The monetary sovereignty would lose their surveillance power.
So, you know, like the future has like different outcomes
based on which of these Powers is accentuated for the
government and which of the powers is weakened for the state
and all of you are like on like different spectrums of some of
your advocating for Or a particular thing will be
strengthened and another particular thing will be
weakened and like that's these are of difference in your
predictions. So maybe we can actually like
classify your predictions. Using some model like that right
here that I think that's actually really good way of
putting it. I think personally that for me,
I think the surveillance is something that will be harder
for them to enforce, and I think they know that and I think which
is why maintaining the monetary dominance is Something that they
can do more easily. It's like surveillance is like
this hard problem, where you have to have, like, monitor
literally everything but like with monetary dominance, it's
not like it's something. You can like kind of enforce
Knock by like needing visibility into the entire thing.
But just this like larger thing where you like, I don't know how
to describe it. Exactly.
But yeah, I don't know maybe someone else can bring it.
In a way you actually have that now, right?
I mean, so we basically Cassius to a large extent not traceable
and you still have monetary dominance as a nation state.
So in summary I think what we can say is that with some with
some amount of certainty is that crypto markets are going to see
a pretty significant increase in prices this year and I think we
all welcome that. And, but at the same time, the
attention that will that will bring two crypto, May in fact,
cause the space to regress, in terms of its ability to
innovate, as freely as it has, you know, The last, like, three
years since the last Bull Run. Would you say that that's, would
you guys agree that that is sort of the overlying trend that we
should expect in the next year? I do think we will see a large
amount of regulatory push back, but I do think, I mean, this is
kind of where we disagreed on the episode, right?
So, whether whether this will actually mean that a large
portion of the ecosystem will become regulatory compliant or
whether there will still be a large unregulated part and I
think the ecosystem will very much rarely to avoid being.
Being regulated in an overly dramatic, transgressive way.
I mean, if you if we bring it back to the just kind of brief
just want to briefly bring it back to this analogy, if we
bring it back to the, to the, to the piracy and like music,
download example, I mean, that's exist.
It still exists in massive scale.
There are still, you know, Terror like a hundreds of
terabytes of day. Probably even thousands of
terabytes per day of music and movies being downloaded and
that's despite government's trying to stop it.
It just doesn't interface. With any regulated with any
regulated entities, I don't know what that, how that overlaps to
in the crypto space, but it might be one indication that
there are can still be a sort of wild west of crypto.
While a lot of the Innovation that's coming the last few years
and that will continue to come will be sucked into a regulated
space. I mean it really meant it
depends on what the regulated alternative looks like, right?
So basically if you think back to iTunes where base you could
buy any song for 99 cents, I mean, I don't even know whether
that still exists. I haven't seen iTunes in years.
So, I assumed that it kind of was probably discontinued
because the people didn't like it in our people.
It wasn't appealing enough for people to stop pirating, right?
Well better Alternatives came around exactly because better
transitive Came around. And so I think unless the
regulated open Financial defy space is as attractive as the
unregulated one. I think it's not going to happen
and people are going to find an engineer ways around it.
All right cool. Thanks to all of you and I think
we can. All agree that this is you guys
have our audience has really I think over the years like asked
for us to do more of these and what we've all agreed on here, I
think, is that That will try to do these at least once a quarter
because you guys like them and also like we think they're
really fun. And we're good guests.
So yes, also. So with that happy New Year to
everybody and we'll see you on the internet.
Thank you for joining us on this week's episode.
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