Meltem Demirors: The Dark Side of Crypto

In this conversation, Meltem and Anthony Pompliano discuss the intersection of technology and finance, why she believes stablecoins are the new CDOs, and where cryptoassets fit into an institutional investors' portfolio.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:03Anthony Pompliano?

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to Off the Chain, simply the best podcast in crypto. Let's kick this thing off.

• 0:15Anthony Pompliano?

  Meltem Demirz is a cryptocurrency investor, advisor, and advocate. Meltem previously worked with some of the largest companies in the world, was a vice president at Digital Currency Group, the founder of Athena Capital, and is the current Chief Strategy Officer at CoinShares. In this conversation, Meltem and I discuss the intersection of technology and finance, why she thinks stablecoins are the new CDOs, where crypto assets fit into an institutional investor's portfolio, and finally, we covered a concept that she calls the shitcoin waterfall. Meltem is one of the most important voices in crypto. I hope you enjoy this discussion as much as I did. Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions

• 0:58Anthony Pompliano?

  of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only.

• 1:17Anthony Pompliano?

  Alright, Meltem, we've got a lot to get through.

• 1:20Speaker 01

  What up?

• 1:23Speaker 01

  Keeping it cash on a Thursday.

• 1:24Anthony Pompliano?

  Yeah, we had a great warm-up before we turned on the recording, so it should be fun. Let's go over real quick for people who don't know just your background, and then we can dig into all of the controversial ideas that I'm sure you're excited to talk about.

• 1:36Speaker 01

  I don't think they're controversial, they're just, you know, thoughtful, I hope. But, we can debate the merits of that. So, look, I don't want to be boring. So, I math and finance background, started my career in the oil and gas industry during the onshore shale boom, have seen what irrational bubbles look like from the inside of some of the world's largest corporations, focused primarily on oil and gas M&A, oil and gas strategy, and then decided to go, as a consultant, decided to go in-house at ExxonMobil, worked for the treasurer of the corporation there, and got to sort of see the inner workings of, which at the time, the world's largest corporation, which is really interesting. Learned a lot there, went to business school at MIT,

• 2:21Speaker 01

  did a lot of work there on kind of the fintech startup wave that started around 2012, 2013. Got into the venture space and really just saw so many interesting problems in venture with incentives between investors and entrepreneurs, had been bitten by the Bitcoin bug and then met Barry Silbert, who'd been working on this idea called Digital Currency Group, joined him in 2015 to build that out, spent three years there, took the firm from 20 portfolio companies to 120, built a bunch of great businesses, did a lot of really interesting things and also was there really for the move from Bitcoin only to enterprise blockchain, then to tokens, now it's back to blockchains via security tokens.

• 3:04Speaker 01

  So it's been interesting being a part of that evolution and really being involved in many different parts of the ecosystem. Now what I do is I'm at CoinShares, which is a digital asset management business. I'm really focused on building the next generation of financial products and services for retail investors, institutional investors, and most importantly, the crypto space. We need to start bringing more institutional asset management principles into this industry to really make it credible and an investable asset class. And it needs to be done in a way that is kind of true to the principles of crypto, but also incorporates the last 150 years of knowledge around corporate finance, behavioral finance, incentives, et cetera.

• 3:43Anthony Pompliano?

  Absolutely. What originally drew you to Bitcoin? Why Bitcoin?

• 3:48Speaker 01

  Yeah, so the original draw to Bitcoin was I needed to send a transaction and I needed to send it to a market where there was no real banking infrastructure. My family's from Turkey originally and I looked at a bunch of different options and one of my friends was like, "Oh, have you heard of Bitcoin?" And so I went on Reddit and I went to r slash Bitcoin and I was like, "Wow, there is a lot to unpack here. This is wild. It's weird." I had to then get Bitcoins, so I pinged my brother who You know, he and I grew up playing video games together. He's a programmer and a developer, so he's always kind of on the bleeding edge of these things. And he's like, yeah,

• 4:29Speaker 01

  localbitcoins.com. So I went on LocalBitcoins and I met someone in a parking lot and it felt like a drug deal, but it was a Bitcoin deal, which was pretty exciting. And from there, just the more I started learning, the more interested I became. Luckily, in grad school, I had a lot of free time. I was at MIT where there was a lot of work going on on campus with students who were, you know, mining in their dorm rooms. Some students got sued by the state of New Jersey for running an illegal lottery because they were running a Bitcoin faucet. So it's just really fun, really interesting. And then the whole crypto anarchist thing, just add an extra layer of interest. I never really thought about the relationship between money, power, politics, and societal structure. And so I think for me, that was really a moment

• 5:12Speaker 01

  where I started to just become a lot more aware of what was happening in the world and the implications of changing the structure of how money works.

• 5:20Anthony Pompliano?

  Absolutely. It's, I think, not talked about enough that not only is this a technology solution, right, but it's also opening the mind and really drawing attention from a psychological standpoint. What do you think is the most misunderstood concept in crypto?

• 5:35Speaker 01

  I do think the word de- so there are two things that really trouble me. I make this comment often. I say a lot of times when people who are new to the crypto space and who are skeptical enter the crypto space or go to a meetup or a conference, what they say is, I feel like I walked into a dystopian Ayn Rand novel filled with 25-year-old white dudes. And look, that's not criticism. Oh, I just got a checkmark. I think we have two 25-year-old white dudes in the room here. But look, here's the two things I think we do that- Don't really translate well. And to the point you made earlier about this being psychological, the way I would phrase that is this is a battle for hearts and minds.

• 6:20Speaker 01

  If we look at innovations, if we look at big shifts in structure in human history, it's really about moving hearts and minds. And I think we're missing that a bit right now. The first concept that's really overused is this word decentralization. And decentralization means many different things. You could have decentralization at the protocol level, both from the distribution of wealth, so kind of a Gini coefficient analysis, as well as the distribution of power and who gets to write the code and set the rules. And we're seeing that being challenged. Bitcoin, huge power struggle all the time. Ethereum has Vitalik, who more or less has been their anointed leader. And I think every protocol kind of struggles with decentralization.

• 7:02Speaker 01

  Then you have the networking layer decentralization. So mining power, how that's distributed, staking power, how that's distributed. And then at the application layer, are there a lot of different entities producing applications? Are those applications decentralized? That word is so poorly defined, and it's used as an ad hominem attack on projects without any qualifications. So I think that's one kind of concept that we use a lot that we don't really articulate very well. I think the second component is there is this moralistic bent the crypto community has, where I think a lot of people who adopted Bitcoin and other cryptocurrencies early, they have become wealthy, they've gained independence of thought through luck

• 7:46Speaker 01

  and some degree of conviction. But I think for a lot of people, it was really luck, being in the right place at the right time. And they've now started to attribute that to intelligence and some sort of moral superiority. And I think that's a troubling narrative, and it's also not a very inclusive narrative. So I think for people, for hearts and minds to really shift, we need to start moving away from this moral high ground and really start thinking about, okay, what does the next billion Bitcoin users look like? And how do we get to that point? It's probably not by talking about decentralization and, you know, all of these political and economic principles. By giving people something they can use that makes their life better in some way.

• 8:27Anthony Pompliano?

  Absolutely.

• 8:27Speaker 01

  I think we're missing that.

• 8:28Anthony Pompliano?

  I think that's fair. So let's go back first to this idea of decentralization, right? In non-crypto, you know, technology, the idea of a founder being able to, you know, really drive, go through obstacles, recruit people and set this vision that we've kind of made it, you know, really sexy to be a founder, right?

• 8:50Speaker 01

  As a former founder, it's the least sexy thing. It's really crappy. You're like, you haven't showered in a week. You haven't eaten a proper meal. You have no idea what's going on. You're emotionally exhausted. You're constantly living between a state of euphoria and like tremendous soul-crushing anxiety. But yes, the narrative is it's sexy.

• 9:10Anthony Pompliano?

  The duck analogy, right? So if you look at a duck in water, above the water, they're cool, calm and collected. Below water, they're just paddling as fast as they possibly can so they don't drown, right? But, but, you know, in this decentralized world, this idea that there is no leader, right? And you don't need to have a single point of failure or that, you know, threat component. How do you think founders and leadership play into a decentralized world? And is it important?

• 9:39Speaker 01

  That's a really interesting question. I don't think I have a definitive answer. But again, going back to this idea of hearts and minds and how humans operate. I think that people are drawn to characters, even though the crypto community to some degree tries to be decentralized. What's really interesting is we have a very strong cast of characters and they're very opinionated and very loud. What I think it goes back to ultimately is, look, I've been in the venture space for quite some time. And what's interesting about it is in the venture space, the way that founders operate, you're running a company, right? Companies require organization.

• 10:21Speaker 01

  And the reason that the corporate form was created, it's really just a governance structure, right? Because establishing contracts for every single piece of work, every single transaction doesn't make sense. So the corporate form was created to line incentives between investors, employees, managers, stakeholders in that entity. And they're all incentivized to work together towards a common set of goals. And that's reinforced by legal contracts, financial incentives, and the terms of shareholder value and bonus structures and how people get compensated. And it's taken us 200 years to get to a workable corporate form, right? And we see that reflected in the size of the equities market. People are willing to put trillions of dollars into that corporate form in the form of investing in stock.

• 11:06Speaker 01

  What's interesting about crypto is there is no such form, right? The crypto firm, or what I like to call the theory of the crypto firm, is highly immature because this is new. But what we see is people are trying to replicate things that have existed in the corporate form for the last two centuries in the crypto firm, and it doesn't quite work. Because right now, if you're an investor and you're putting capital into a crypto firm or someone who's capitalizing their company through a token, you have no rights, you have no preferences, there are no covenants, there's no legal contract that binds that founder to do anything on your behalf. And what you then see is there are tremendous abuses of power, there's tremendous degree

• 11:51Speaker 01

  of moral hazard. And I think, I don't mean that to say that people set out with that intent, I just think the form we're using is perhaps not appropriate for what we're trying to do. So I think the narrative around security tokens is really compelling because investors can understand that. But when you say to someone, if you read the terms of some of these tokens, you know, there's a disclaimer in every token sale that says, you have no rights, you're not entitled to anything, we're not promising that we'll give you anything. So the idea that we're going to give people billions of dollars on the basis of social trust.

• 12:25Speaker 01

  I think is an imperfect idea because blockchains don't change human nature.

• 12:29Anthony Pompliano?

  Absolutely. Well, and I think that what's interesting is, you know, people forget that the securities started out looking very different, right? So when equity was first, you know, created and somebody said, I'll give you money to run this company. It wasn't for enterprise value to then go public or to be acquired. It was literally a claim on cash flows.

• 12:48Speaker 01

  Exactly.

• 12:49Anthony Pompliano?

  Right? And so that it's almost like we're coming full circle to some degree with, you know, all this on-chain governance or claim to, you know, transaction fees, et cetera, in the blockchain world. How much of that do you think can be solved by technology versus the psychology?

• 13:06Speaker 01

  That's a really great point, and I think that's probably a great way to summarize what I just spent five minutes articulating. So I think what's interesting here is you have a lot of people, a lot of the people in the crypto space who are working on these ideas tend to be younger. I think a lot of them haven't worked in corporate structures before. And that's not a bad thing. There's a lot of value in experimentation and innovation because you can learn things that can be applied at scale. I think the challenge here is, is that the learning process has gotten a bit bastardized because we are building things that are highly imperfect, that are very flawed in a lot of different ways, both from a technical perspective,

• 13:51Speaker 01

  governance perspective, and actual scalability and implementation perspective, the practical application perspective. Yet, these projects are being capitalized at valuations that exceed the average IPO by a factor of 10.

• 14:05Anthony Pompliano?

  Yep.

• 14:05Speaker 01

  Right? And so I think we kind of have created this false sense of success where people feel, hey, I'm able to raise a shit ton of capital. It's literally a shit ton, and they have no plan on how to deploy it. And I think the interesting conversation I have with founders, because one of the things I've been focused on is helping people with treasury management, is there's a difference between need and want, right? So maybe I need $50 million to build this idea. But the market wants to give me 500 million. So.

• 14:37Anthony Pompliano?

  What do you do?

• 14:37Speaker 01

  Yeah, exactly. And blockchains don't change human nature, right? There's a lot of ego involved. This crypto environment right now, the narrative is so focused on price and how much money was raised that we're kind of getting to that stage where I think the money needs to get flushed out a bit. And we need to go back to building. And this goes right along with Carlotta Perez's research around capital formation bubbles and how that corresponds with technical innovation cycles. But a lot of this is, we have this technology, but can we articulate a clear reason that this technology needs to be utilized for things that we already do in the existing world? And I think that narrative just isn't there yet.

• 15:19Anthony Pompliano?

  It's the trade off between, because there's so many technologists, right? They want to talk about technology. I call it like the hacker mentality of their, you know, they're tinkering. They make technology do something that they haven't seen before, or it's faster, it's better, whatever. And they start showing people, people get excited. But I think there's too much focus on that technology. And instead, if you look at it, the opposite side and say, let's look at it from user behavior.

• 15:39Speaker 01

  Yes.

• 15:40Anthony Pompliano?

  Right? Now, the user actually doesn't care what's under the hood, right? The, you know, there's some users that will, right? Obviously, some small subset. But the mass consumer, mass user doesn't actually care what that technology is. They just want to accomplish what they're trying to do with this technology.

• 15:53Speaker 01

  But I think this is part of the challenge when you have a movement that really started with engineering and technology. Is you have a bunch of developers and engineers who, for the first time, are discovering finance.

• 16:04Anthony Pompliano?

  Yep.

• 16:04Speaker 01

  And they're saying, oh, we can treat finance like code. And there's an input, and then there's a contract, and then there's output. And the thing is, like, you and I have worked in traditional finance. That's not how people think.

• 16:17Anthony Pompliano?

  Yep.

• 16:17Speaker 01

  People don't respond to an input function with particular output. And I think my friend Jill Carlson says it best. It's not, you put in a token, you get out an action. That's not how incentives and systems work. It's a little bit more complex than that because human beings react to emotion. Human beings, I think, are fundamentally irrational. And again, behavioral finance is a field of study that's only really, you know, half a century old, 50, 60 years old. And we're still learning a lot. Look at what happened in 2008. Not a lot of people saw that coming. Look at what happens in individual asset classes. We have all these great ideas and what we see is the breakdown of markets. Look at the equities market right now. Look at the fangs. Right?

• 17:00Anthony Pompliano?

  Absolutely.

• 17:01Speaker 01

  It's an imperfect science, but I think treating crypto like a math problem, treating it like an engineering problem, treating finance and money in that manner is interesting, but I don't think that works. And so I think the next five to 10 years are probably going to be spent trying to figure out how to integrate other disciplines into.

• 17:25Anthony Pompliano?

  So, so I think that an example where the finance community has previously treated money and finance as a math equation or math game, right?

• 17:36Speaker 01

  Yeah, you see that with like CAPM and WACC and DCF and all these valuation models, like.

• 17:42Anthony Pompliano?

  Well, so if we go to the CDOs, right?

• 17:44Speaker 01

  Sure.

• 17:44Anthony Pompliano?

  You recently said, you know, stable coins are basically the CDOs of crypto. Explain what you mean by that.

• 17:51Speaker 01

  Right. So, so I think here's the problem is the, the crypto community has latched on, we tend to latch on to narratives and then we work through a narrative for six to nine months, right? So the narrative that started developing last year was, oh, the reason that people don't want to invest in crypto is because it's too volatile and moving into and out of fiat is too difficult. And so people started saying, why don't we create this concept of a stable coin? And we've already seen iterations of it. I think part of the impetus, frankly, was the fact that Tether was so successful and so widely adopted that it kind of shocked everyone. But I think the problem with stable coins now, and now every platform is launching their own stable coin, right? So you have collateral backed stable coins like Tether or like Digix, which is backed

• 18:34Speaker 01

  by gold. Then you have collateralized stable coins, so things like Maker or Haven that rely on kind of a two coin system where you can redeem or create the stable coin through a secondary mechanism. And then you have the idea of a programmatic, quote unquote, decentralized, almost decentralized bank structure or sovereign issuance structure where people are issuing assets, then. There's complex governance structure and I, I think the problem is this is number one, the thesis as to why stable, stable coins need to exist has not been proven true. Right. Same problem with fat protocols, like that caught on. And then we saw billions of dollars of financing flow into nonsensical protocols because everyone

• 19:17Speaker 01

  was so addicted to this idea of fat protocols. I think we have the same narrative with stable coins where we're creating this false narrative in our minds because at first blush, um, it makes sense, right? It's like if A, then B, therefore C must be true. And we know that's not always true. So what I think we're doing is we're, number one, we're financing stable coins through an investment structure that doesn't align incentives, right? So going to an investor and saying, hey, if you buy this asset early on, then you're going to get to participate in value creation or in the flow of payments through this network. Like, that doesn't really work. No one's paying the Fed to create dollars.

• 19:53Anthony Pompliano?

  Yep.

• 19:54Speaker 01

  So I think that's a weird structure. And I think again, what we're doing is we're creating all of the systemic risk, right? Because now we have stable coins on protocols and then on top of the stable coins, there are more coins, like it's coins all the way down, coin, coin, coin, coin, coin. And the thing is, at some point, we stop being able to untangle how any of this works. And the degree of systemic risk in the system is already so incredibly high. You think about the fact that Zappos custodies 10% or more of the world's Bitcoin. You think about the fact that Coinbase holds a lot of crypto assets. You think about the fact that Binance probably hosts 50% of traded volume in all assets, right? We already have a lot of systemic risk. We don't need to layer in 50 to 100 to 150 different stable coins that are all abstractions of themselves with no governance structure, no auditability.

• 20:39Speaker 01

  And frankly, like, no one has the appetite to monitor this shit either.

• 20:42Anthony Pompliano?

  Yep.

• 20:42Speaker 01

  So it's unnecessary.

• 20:44Anthony Pompliano?

  Part of it too is, and I think we agree that, uh, if you have a heavily, uh, an engineer heavy team or a finance heavy team, right? You're at a disadvantage than the team that is more diverse, right? So having a, a combination of, uh, people who come from the engineering world, from the technology and product world, from finance, from design, et cetera. By bringing all those people together, you get different experiences, different perspectives, uh, different knowledge bases. And so the product is probably going to be much more usable, right? And, and also technically sound, or is, is kind of the theory.

• 21:15Speaker 01

  Yeah. The other piece, I'll just add to that is I think it helps to have people with different backgrounds and different experience. Um, what I always like to say is history.

• 21:27Speaker 01

  Doesn't repeat, but it rhymes. And I think a lot of times when people come in and they pitch an idea to me, I'm like, that's interesting, but this has been done 50 times before. Have you gone back and just?

• 21:40Anthony Pompliano?

  Looked at it.

• 21:41Speaker 01

  Looked at it. And so I think sometimes we sort of jump on ideas because of the newness of the idea, when in fact, it's really just an iteration of what's already being done in other industries. So I think there's a little bit of intellectual arrogance in the crypto community. And I myself, I think when I started in Bitcoin was probably guilty of it. And I was, you know, a little bit of an asshole. But as I've learned, I've really started to appreciate, when I go into meetings now with people outside the crypto space, I actually spend most of the time not talking. I spend most of the time just asking questions and trying to understand someone's mental model.

• 22:18Anthony Pompliano?

  And so in that, where do you think crypto assets sit in a traditional capital allocator's portfolio? How are they thinking about that right now?

• 22:28Speaker 01

  Yeah, so I just put out some, some content around this. And hopefully in the next few days, we'll push out a longer report with a lot of great data in it. So look, if we look at this institutional investor class, there's about, in the US, there's about $28 trillion of institutional AUM. And that's mostly pensions, but that's endowments, family offices, hedge funds, venture funds, PE firms. Crypto market cap is 220, 250 billions on daily basis right now. And so what I, what I think is challenging is right now, those, those firms are allocating to low risk securities, right? So T bills, strips, bonds, et cetera.

• 23:10Speaker 01

  That's a small percent of their portfolio. They have cash, money market stuff. They have traditional equities. They have real estate. And then maybe fifteen percent of their portfolio is in higher risk assets that focus on early-stage capital formation to growth-stage capital formation. So that's growth equity and PE. It's hedge funds and it's venture. And so as we look at that, where do crypto assets fit in? Monetary instruments, probably the closest analog to something like a Bitcoin. Right? So that's more like your money market bucket. Real estate, that's probably more like securitized assets, right? So can we securitize assets and make them more flexible? Maybe.

• 23:53Speaker 01

  Equities, that's more like token offerings that represent equity in privately-held companies, right? That kind of displaces that PE bucket. ICOs probably fit more into the VC bucket where it's really early-stage ideas getting capitalized. So what I'm trying to think of in the context of an institutional investor is what are those analogs? Because I think there may be new capital that flows in, but likely it's more of a displacement of existing allocations into some of these new asset classes. And I think what's challenging there is you have to frame the narrative in a way where an institutional investor, A, understands what they're buying. It fits into the mental models they have that have been trained, you know, over the last fifty years.

• 24:34Speaker 01

  And then they also have to be able to hold it, trade it, deal with it, talk about it to their investors in an easy way. And I think that's where the market infrastructure side is a little immature. We've been so focused on the creation and distribution of assets that we really haven't started thinking about the management of assets. So that post-investment lifecycle is pretty underdeveloped. And then end-of-life of an asset, right? So what happens when a token is dead? How do you redeem a token? Back into cash? What do you get? So there's going to be a lot of experimentation, but I think the slice of the pie that's going to go into Cryptocurrencies, true store value cryptocurrencies, ICOs, security tokens and securitized assets

• 25:18Speaker 01

  is initially going to be much smaller than we imagined. But then when we start being able to prove that in fact, that efficiency, that liquidity, and that sort of usability component that we talk about can actually be realized. Once there's proof of that, I think it'll grow much more quickly. But we're not doing a very good job right now.

• 25:35Anthony Pompliano?

  So I definitely agree with that. And I think that what one hope of a lot of people in the crypto world is that some of these traditional legacy players can come in and legitimize the space, right? And so ICE, for example, coming in and saying, hey, we're going to create this platform, right? And we're going to kind of put our name, our experience behind this.

• 25:54Speaker 01

  Yeah.

• 25:55Anthony Pompliano?

  How do you think that impacts the space, not only from the development of crypto assets and networks, but then also from the institutional investors' perspective?

• 26:04Speaker 01

  Yes, I think the ICE announcement is one that I'm still processing. In one way, I do think it's really good because it adds legitimacy to the space. I think particularly Bitcoin, right? Bitcoin is that asset that's been in the market long enough. There's enough data around that investors are starting to get more comfortable with the idea of Bitcoin. So I think that's

• 26:22Anthony Pompliano?

  It's familiar.

• 26:23Speaker 01

  Exactly, right? But also that body of knowledge exists and we now know how to deal with it. Most importantly, you know how to value it and market. I think that's a huge problem we don't really talk about as much. So Bitcoin's starting to feel familiar. So ICE coming out and saying, look, we're going to enable you to really easily, with a trusted partner that you already can trade with, buy and sell Bitcoin. Like, that's, that's material. I think the hard part is, is once the financial institutions start moving in, they're gonna do what they do, right? Like, banks got a bank. So people have started talking to me now about the idea of extending leverage on top of Bitcoin. And I'm like, oh.

• 27:00Anthony Pompliano?

  It's coming.

• 27:01Speaker 01

  Oh, shit. That is not going to go over. Like, that's the antithesis of why Bitcoin was created. So I do think there's this component. And what I always say is there's the revolution camp, which is where I started out when I got into Bitcoin, like, down with the banks, like, fuck the institutions. And that's one narrative. And then there's the evolution narrative, which is, hey, we're gonna start with something that looks, smells, tastes, feels like what's already happening in the world of institutional finance. And then over time, it will involve in form to be more reflective of all of the technical capabilities of a blockchain-based asset or cryptocurrency.

• 27:37Anthony Pompliano?

  Which, which do you think is more likely to occur today? The revolution or the evolution?

• 27:44Speaker 01

  Okay, so here it actually depends on the broader macro environment, which is something I don't think we think about often inside the crypto bubble. If we have another 2008, if we have another Cyprus or another Greece, um, then I think we're gonna go revolution. And the thing I always think about is, are we ready, right? Like, when that narrative starts to really accelerate and when people have that impetus, when there's that, what I always think is path dependence, right? So if we stay on the current path, we're gonna go evolution. But if there is a massive force that jolts us out of that path, then we're gonna go revolution.

• 28:17Anthony Pompliano?

  So this, this is fascinating because, uh, somebody asked me, uh, recently, what did I think would get us out of this bear market, right? And I said, there's gotta be some kind of catalyst, right, that will, that will create some inflection point. And I said, you know, it's a retail product is one option. Um, not necessarily because I think people have a hard time buying Bitcoin, but it's more of the legitimacy, insurance, custody, all that kind of stuff. Uh, another could be that, you know, just some huge institution reveals that they've got, you know, a position that no one knows about, right? So if, you know, a sovereign wealth comes out and says, listen, we've bought, you know, billions of dollars worth of Bitcoin, right? Something like that where, again, you just get a bunch of legitimacy. But the third one-

• 28:54Speaker 01

  If that happened, then like capital inflows, you know, that would really drastically shift the price.

• 28:58Anthony Pompliano?

  Yeah. Well, well, well, and so here, here's the third one, and actually, one I think doesn't get talked a lot about, and you just mentioned it, so it's worth spending time on, is, uh, if there is an economic chaos that occurs in a specific region or country that causes people to flow into Bitcoin, for example, because it is the best option available, it's almost like we get to watch it play out as an example-

• 29:23Speaker 01

  But let's go back to hearts and minds, right?

• 29:24Anthony Pompliano?

  Yep.

• 29:25Speaker 01

  So I don't think it even has to be economic. I think if we look at the political climate in a lot of economies, we look, you know, globalization was the theme in the nineties, nineties and the two thousands. And now what we've started to see is like, yes, globalization has changed the world. Integrated markets, more efficient markets, more assets, more capital, more cash has lifted a lot of people out of poverty. Like objectively speaking, if we look at the data, people are living a better quality of life. There is more wealth in our world than there was in the past, but inequality has grown. And I think this is the challenging part is a lot of what's happening, it's social. There's a lot of social unrest. There is a lot of political unrest. And there's a lot

• 30:10Speaker 01

  of uncertainty and fear, even in, even with investors.

• 30:13Anthony Pompliano?

  Absolutely.

• 30:14Speaker 01

  Right? We look at what's happening in equities, like the Dow hit 25,000 and everyone's like, peak, peak, sell, liquidate. What are we going to do? And it kept going up. Everything feels overvalued. You look at real estate, real estate feels overbought. VC, everything's overvalued. And so investors are looking at the world, at this macro environment. They're like, in a world where everything feels overvalued and overbought, in a world where we're really not sure where alpha is going to come from, what do we do?

• 30:44Anthony Pompliano?

  Absolutely.

• 30:45Speaker 01

  I think that creates a lot of room. And I think again, what we as an industry need to start to think about is how do we win hearts and minds?

• 30:53Anthony Pompliano?

  This is, uh, this is where the virus is spreading phrase came from.

• 30:56Speaker 01

  This is the pomp approach.

• 30:59Anthony Pompliano?

  Literally, the, the, the thought process was, uh, I originally said, uh, one of Bitcoin's greatest qualities is that it's captured, uh, I, I said the mental energy of a generation, right? People were so excited and the talent was flowing into the space, the capital was flowing into the space. And so you get these boom and bust cycles, but innovation follows that talent and capital.

• 31:21Speaker 01

  Yeah.

• 31:21Anthony Pompliano?

  Right? Because there's just so much mental energy being applied to it.

• 31:24Speaker 01

  But what I worry about is like, we look at what happened with retail in late 2017, early 2018. And this is what I worry about is a ton of retail investors got crushed.

• 31:35Anthony Pompliano?

  Absolutely.

• 31:36Speaker 01

  And I think the hard part is those people aren't going to come back for a while because their trust has been destroyed. And we did it through this financing vehicle where we created a bunch of wealth under the guise of decentralization that really flowed into the hands of a few people. And, and you see this, right? Reflected in like all these crypto conferences and like people going to exotic locations and living really lavish lifestyles. And then this gets glamorized, which brings in.

• 32:02Speaker 01

  You know, less educated wave of retail, and I find that a bit problematic. Crypto has a little bit of an image problem. And yes, like the sexiness, like the sex, drugs, rock and roll appeal of crypto is definitely there.

• 32:15Speaker 01

  But I think it's a double edged sword. Because a lot of people have gotten really burned, and I think a lot of people look at it and they're like.

• 32:23Anthony Pompliano?

  Yep, well, if you think of the last 12 months, so we're doing this August 2018, so August 17, right, is really when I think kind of the more mainstream audience started to at least hear about it. And then you go into October, really November, December. And then you look at the price depreciation since those days. There's a possibility that more people lost money investing in Bitcoin the last 12 months than made money. Right, on an aggregate number of investors.

• 32:51Speaker 01

  Absolutely, I have so many stories from retail investors and institutional investors, by the way, who really got burned. And I think part of the problem here is people like stories, right? Where humans have a rich oral history because we tell stories. That's how we share information, that's how we connect with other people. So the story around crypto up until January 2018 was this. Everyone had a friend or someone they knew who bought Bitcoin early or who bought Ethereum early. And they, the asset they bought went from X to Y. And that delta was, you know, a thousand percent, 12,000 percent, 5,000 percent. And so people look at that and they're like, ooh, Bitcoin, Ethereum, Ripple.

• 33:37Speaker 01

  People got into these assets early that have been around for five or six years. They made 100x, 200x, 1,000x their money. I want to do that. And then all of these ICOs are pitching, we're the next Ethereum. We're like Bitcoin but better, and so people buy it.

• 33:52Anthony Pompliano?

  Yep.

• 33:52Speaker 01

  And then that doesn't materialize. And I think this is the problem with growth stories, right? And this is the way equities markets work, right? You see it happen there as well. It kind of reminds me of penny stocks.

• 34:03Anthony Pompliano?

  Absolutely, no, no, and part of it is you're trading or gambling, right? You know, if you look at 100 of them.

• 34:11Speaker 01

  But you get to say you're a tech investor, right? Like you get to gamble full time. I love gambling, I'm a degenerate.

• 34:17Anthony Pompliano?

  I tell people, I tell people that you can't, you can't claim you're investing if you don't have a thesis. You don't have underwritten the risk and you don't have a price target.

• 34:27Speaker 01

  Well, and I think this, so this actually is a really good point, so. People are so focused in investing, and this is true venture as well, right? I worked a lot on the post-investment side. People are so focused on everything up to the point of writing a check. And then, once they write the check, they're like, okay, my work is done. No, no, actually, your most important job as an investor, one, the investing process is about controlling entry price.

• 34:51Anthony Pompliano?

  Yep.

• 34:52Speaker 01

  And it's articulating a thesis and a strategy as an investor. But as a fiduciary, your primary responsibility is that post-investment lifecycle.

• 35:00Anthony Pompliano?

  You have to monetize it.

• 35:01Speaker 01

  How do you track the status of these projects, right? How do you articulate a cogent thesis on where your liquidation points are? And how do you periodically rebalance and de-risk? And take out some of the principal and then reinvest? How do you think about your role in the governance of these companies that you're capitalizing? And what's so funny to me is like, I've been doing this in the venture world with the portfolio companies I've been working with for the last five years. And now crypto funds are like, oh, like, maybe we have to be partners to these projects. I'm like, I feel like I'm taking cra- like, am I taking crazy pills? Um, I think so. It's, it's just really interesting, the naivete and just...

• 35:42Speaker 01

  And again, I, I sound like a skeptic, but I just, I feel like we're not learning lessons. I feel like we're so unwilling to accept fundamental truths.

• 35:51Anthony Pompliano?

  Yep.

• 35:51Speaker 01

  About human nature, that we're forgetting that like, hey, when you write a check, like...

• 35:57Anthony Pompliano?

  Well, it's part of the revolution, right? Is if you go from, you know, step one to step seven.

• 36:03Speaker 01

  Yeah.

• 36:03Anthony Pompliano?

  You don't get the benefit of learning, what, two, three, four, five, and six?

• 36:07Speaker 01

  Actually, the other thing is people have gotten away with free riding, right? Both in their diligence process, so people are like, oh, if Andrew Senn invested, if USV invested, I'm investing. So that's, there's free riding on the investment process side, where people basically do no work and are able to raise crypto funds. And then the second component is there's a lot of free riding in the post-investment process. And it happens in traditional venture, which is why everyone's like, oh, find a strong lead, because I don't want to do the work. Let's have someone else who is more capitalistic do the work to help you grow. Same thing in crypto world, right? Like, and the problem is when you have a bunch of investors who are free riding off of everyone else, and they don't actually own equity, they just own tokens, which are liquid right away. What's the incentive to actually help people long-term? And this, I feel bad for projects who raised money from investors. They basically sold their souls to raise this money.

• 36:50Speaker 01

  And then, as soon as the token lifts, everyone dumps the token, takes their cash out, and they're trying to build, they're like passionate about building a vision. And everyone who told them they were all so passionate about it, just fuck them. They're like, cool, we got our cash, bye. And that's not a good paradigm either. So I do feel bad for companies who have a big vision who are trying to build it. Like, that's why I think a lot of these projects who didn't set a date for releasing their token, they're probably better served to not release their token until they've gotten the max juice out of their investors in terms of helping them.

• 37:22Anthony Pompliano?

  So, uh, okay, let's go to the dark side of crypto, right?

• 37:25Speaker 01

  I love that shit.

• 37:28Anthony Pompliano?

  Three, uh, three things. So one is, let's talk about, uh, what we'll call air quotes, professional investors, right? So funds and venture capitalists, et cetera, buying tokens at huge discounts and not disclosing positions and then dumping on retail. What?

• 37:44Speaker 01

  The shitcoin waterfall. I love the shitcoin waterfall.

• 37:46Anthony Pompliano?

  All right. So, so, so, so explain kind of your perspective as to what's been going on. Really, I think, you know, some of it hopefully is dissipating a little bit, but, uh, maybe not as fast as we want it to, but, but explain kind of how that happens and then where you think, um, things need to change.

• 38:02Speaker 01

  Sure. So I'll quickly describe the shitcoin waterfall.

• 38:08Speaker 01

  It's, it's a terrible way of saying something, but, um, okay. So the shitcoin waterfall is this, you get a bunch of, um, people together and they're like, we want to do this crypto project. We're going to build a decentralized computing protocol, right? Great. Um, and so they go to a small group of investors, typically insiders, known people in the crypto space. They're like, hey, we're doing a pre-seed round. We're doing like a pre-pre-sale. We're going to give you tokens at this price. And everyone writes their checks and they raise a couple of million bucks. Great. They then get to go market and hire more people. And then they get to a point where they put out a white paper or something more articulated to the market and they go to a bigger group of investors and institutions. They're like, hey.

• 38:49Anthony Pompliano?

  Who are less, who are less on the inside.

• 38:50Speaker 01

  Who are less on the inside, right? And they're like, hey, we're doing a pre-sale. Look at the people in this pre-pre-sale. They're awesome. But we're doing pre-sale now and we're going to give you a price that is 10x what they paid. Okay, great. So they pay 10x more and then they're like, okay, we're going to pre-sale. Bigger audience, less informed, you get less information, less insight. And they're like, hey, we're, we're going to let you in. And it's at 100x what the pre-pre-sale people paid and 10x what the pre-sale people paid. So you create this laddered structure, right? And this kind of resembles liquidation preferences.

• 39:21Anthony Pompliano?

  Yep.

• 39:22Speaker 01

  Right? In, in a traditional corporation. And so you have this structure and then you're like, okay, we're going to listen to tokens on the market. And they have all of these announcements and they're going around telling their pre-pre-sale investors like, hey, here's our plan, here's what we're going to do, here's what's going on. And then the pre-pre-sale investors, by the way, all collaborate together to say, okay, we're going to buy, we're going to sell. They can manipulate the price of these assets. And actually, my research team's been working on analyzing movement of coins, like the network topology of some of these tokens through the process of listing and how that sort of evolves over time. There's some shady shit people do. And what ends up happening is people start dumping their coins on the market, retail starts buying it. There's this narrative that gets created, like, this is an amazing coin. Look at how innovative it is.

• 40:05Anthony Pompliano?

  Look who backed it.

• 40:06Speaker 01

  Look who backed it, right? Look at the founders. This is amazing. This is so phenomenal. They do a bunch of marketing, they throw a bunch of events. They do maybe a couple of press releases or partnerships or announcements where they're paying people for partnership. And then retail buys up these tokens, everyone's exited their position, and it just starts dumping. And the thing is, the reason the shitcoin waterfall has worked historically is because investors knew there was always a buyer of last resort who was not them. I think in this market right now, because retail has lost their appetite, there is no buyer of last resort. It's institutions selling bags to one another. And so I think ultimately, this just becomes a game of who gets the most information the fastest and who can dump the fastest.

• 40:47Anthony Pompliano?

  Absolutely. Well, and it now leads us to a problem of how much capital inflows actually going on versus are we just recycling funds?

• 40:54Speaker 01

  And I think the circularity of capital is really problematic. And you see this, like, when a venture funds invest in a, in a crypto protocol, they do an ICO, they raise money from other VCs, then take that money and give it to another VC to invest in more startups who then create tokens that the VC buys, that then the protocols. It's like, the circularity is incredible. And I think part of it is... There is no utility for these tokens. There's speculative assets for ideas that are poorly implemented in some cases. And look, it's not a criticism. I sympathize with people with really big visions and are trying to build them. But I think the circularity of capital problem, if everyone's motivated by financial return,

• 41:36Speaker 01

  what ends up happening is you have people who have a short timeframe, they have a short attention span. And the minute that it's no longer worth spending a minute of time on a project because you're not going to get any juice out of it. What's your incentive as an investor to spend time on it?

• 41:50Anthony Pompliano?

  Yep, they're gone. So, all right, so we've got the shitcoin waterfall.

• 41:54Speaker 01

  Yeah.

• 41:55Anthony Pompliano?

  Uh, let's stay within bad actors in the investing community.

• 41:59Speaker 01

  Yeah.

• 42:00Anthony Pompliano?

  So I think the narrative normally...

• 42:01Speaker 01

  I don't want to use bad, right? So bad is a prescriptive word that imbues some sort of judgment. I don't think it's bad. People play this game in every market known to man.

• 42:10Anthony Pompliano?

  So shitcoin waterfall, I don't think is necessarily bad, right? As long as there's some understanding of what's going on.

• 42:15Speaker 01

  You said transparency.

• 42:16Anthony Pompliano?

  Yeah, the bad actor, I think, is the insider traders, et cetera. And where is that line, right? Because we've got some commodities, some securities, some unknowns. And so what I specifically am interested in is recently, a New York congressman, right, was arrested for insider trading, actual insider trading, right? And so how do you think about a traditional, established, well-governed market like public equities, right, where obviously people who are in positions of power, right, are coming under scrutiny, right, and arrested, et cetera?

• 42:53Speaker 01

  Well, the Tesla example is a great one, right? Like, did Elon Musk commit some sort of securities fraud by announcing something?

• 43:01Anthony Pompliano?

  If we took that level of scrutiny and applied it to the crypto markets, what's the end result? How much of it do you think is actually, you know, bad acting versus, hey, these aren't securities, they're commodities? Like, just walk me through kind of how you think that looks, if we apply that level of scrutiny to crypto markets.

• 43:19Speaker 01

  Okay, so first I want to differentiate between two things. There is the law.

• 43:24Anthony Pompliano?

  Yep.

• 43:24Speaker 01

  Which are a set of written rules that are enforced by agencies that have teeth, right? They can put you in jail, they can fine you. So there's the law. And then there is morality, which is very subjective. It's cultural in nature, right? Something that might be deemed immoral in the US could be moral in China or vice versa, or another part of the world. So I think separating the law from morality is important here. So legally speaking, the shitcoin waterfall, market manipulation, et cetera, it's permissible. There is no agency that has come out and said, here are disclosure standards, here are reporting standards, here are standards for how you publish research. That doesn't exist yet. So legally speaking, what people are doing is permissible

• 44:06Speaker 01

  under the current state of regulations in the markets they're operating in. So legally speaking, when there is no threat of enforcement, when there is no threat of going to jail, or getting fined, or getting removed from the investment community, there's no real grit behind these claims people are making. And you're not doing anything wrong in the eyes of the law, so it will continue. Morally speaking, I think that's where it starts to get interesting. So if the premise of crypto is based on moral arguments around fairness, decentralization, these ideals and principles around the democratization of capital, then morally speaking, this behavior is inconsistent with the narrative we're selling to people when we're selling crypto.

• 44:51Speaker 01

  And that incompatibility, that incongruency, makes the whole asset class really unappealing. And so I think the bigger problem is the end of, because there are no regulations in law, the industry itself needs to set a standard. So last year, I created my standard for transparency and disclosure. I also wrote a disclosure policy for Digital Currency Group around how we were going to invest in tokens and announce that and let people know. I disclose everything I own, every company I have an interest in, every project I advise. Before I get on a stage, I put it all online, I update it every two weeks to a month. I think the biggest thing is intent. I will speak about certain assets. I'm excited about projects, but it's important to state to the general market

• 45:35Speaker 01

  that I have a financial interest in these things.

• 45:37Anthony Pompliano?

  Yep.

• 45:38Speaker 01

  That's why disclosures exist. Right now, it's voluntary. I would love to see more people. Practice disclosure, so it's opt-in. And again, I think if the industry can create an environment, particularly the investment community, if we can set an internal code of conduct, and if we can sort of raise the bar for how we conduct ourselves on the moral side, not legally or regulatorily, one, it's going to change the perception of this industry, but two, it's actually going to impact the regulators and lawmakers.

• 46:08Anthony Pompliano?

  Absolutely.

• 46:08Speaker 01

  Because the perception of the industry will change a bit. The question is, is are we going to hold people socially accountable for committing fraud or violating that moral code? And the problem is, there's been no social cost to being a scammer in the crypto space.

• 46:25Anthony Pompliano?

  Well, and morality is very much driven by those around you, right? The moral rules are, you know, unwritten, but they are created and upheld by those in your community, those in your industry, etc. And so if, you know, it's kind of like, you know, criminals, right?

• 46:46Speaker 01

  Yeah, they have a code, like they have a

• 46:48Anthony Pompliano?

  There's a code of conduct.

• 46:49Speaker 01

  Don't snitch.

• 46:49Anthony Pompliano?

  Right? But, but, and that would be deemed immoral, but obviously the things that they're doing are illegal, right? And so once you get into these communities, and I think what you're saying is, you know, crypto is very different. There's, you know, many, many, many more good actors than bad actors, or people who are nefarious or malicious, but it is

• 47:09Speaker 01

  So we hope.

• 47:10Anthony Pompliano?

  Yeah, that is true. But, but it is up to the community itself to enforce those moral standards and hold people accountable to some degree for, you know, any bad acting, etc.

• 47:21Speaker 01

  Yeah, I think the hard part is, what I always like to say, and I know I'm fairly vocal about my views on things, but I'm not the judge, I'm not the jury, I'm not an executioner. The only thing I can choose is my behavior, right? I have no control over other people. And my only goal in what I'm doing and the way I talk about what I'm doing is to just Set a standard that feels right for me. And I know personally what my values are and how I want to operate. And I personally am willing to forgo financial return if it violates my personal principles. Not everyone feels that way, and that's fine. I'm not making a judgment as to whether or not they're a good person or a bad person. I think everyone's incentives are different.

• 48:06Speaker 01

  But I just want to, I'm trying to point out, I'm trying to use facts and I'm trying to use data-driven evidence to demonstrate that a lot of what we're doing here is not going to help us win hearts and minds.

• 48:18Anthony Pompliano?

  Yep.

• 48:18Speaker 01

  And really, my goal, like, is money important? Do I like money? Yes, because it buys me freedom, and freedom means I can do and say whatever I want, which I really kind of enjoy. But I think freedom also comes with responsibility. And I passionately care about Bitcoin in particular, but the broader idea of cryptocurrencies and this idea of the democratization of capital, I deeply care about that becoming a reality.

• 48:41Anthony Pompliano?

  Yep.

• 48:42Speaker 01

  And so if those two things are true, then for me, it creates a responsibility. And so I've chosen to act on that personal sense of responsibility, I feel. I think there are other people in the community who are doing that. I'd love to see that type of leadership come from the investment community. But I think unfortunately, the investment community, you know, the reason people give you capital is to earn a return. And so until we start to see intent and purpose align with capital formation, it's difficult. And I don't begrudge anyone, because like, look, that's your job. You can't go to your investors and say, hey, like, yeah, we didn't dump this token at 50x because, you know, hashtag morals.

• 49:23Speaker 01

  Arguably, you're violating your fiduciary responsibility to your investors, right? So it's a sticky problem, it's a thorny problem. I just think talking about it and experimenting with it a little bit could be helpful for us.

• 49:34Anthony Pompliano?

  Absolutely. No, I think that makes sense. All right, let's go back to the lighter side of crypto and get out of the dark side.

• 49:40Speaker 01

  Can we do favorite shitcoins?

• 49:42Anthony Pompliano?

  Well, also, before we get there, I'm going to ask you a couple of questions and be as honest and controversial as you want.

• 49:49Speaker 01

  I'm never, I'm so shy, though. I'm so afraid of expressing my opinions, Tom.

• 49:55Anthony Pompliano?

  What is the most controversial thing that you believe is true that you think the highest number of people would disagree with you on in the industry?

• 50:06Speaker 01

  Oh, how many enemies do I want to make today?

• 50:11Speaker 01

  How many death threats do I want to get today? Let's see. Um, ooh, okay, here's.

• 50:18Anthony Pompliano?

  The best part about this question is people know what their controversial thoughts are. And so you already know the top two or three things you want to say.

• 50:24Speaker 01

  I'm trying to pick between the top two.

• 50:26Anthony Pompliano?

  Just say number one.

• 50:26Speaker 01

  Okay, number one is this, I think there is actually a less than 0% chance that Bitcoin will not succeed.

• 50:35Anthony Pompliano?

  Interesting, explain.

• 50:36Speaker 01

  And that is, I love Bitcoin. There are so many things about Bitcoin that are just beautiful and just so incredibly well designed. And Satoshi was just brilliant. And not just in its technical design, but the social design, the messaging around it, the political design. There are so many things about Bitcoin that are really elegant and just really interesting, like fundamentally innovative in that they challenge long-held assumptions about how humans can collaborate to get something done, which I think is really interesting.

• 51:14Speaker 01

  But I think the hard part with Bitcoin, I spent a lot of time in the Bitcoin community from about 2014 to 2017. And decentralization, right, is one of these things that's appealing. But centralization creates efficiency. Decentralization has a really high cost. And in Bitcoin decentralization has had a really high social cost. And I think every day that goes by that Bitcoin continues to operate in this sort of very unstructured manner is a day that talent flows to other spaces and interest flows to other spaces.

• 51:55Speaker 01

  And like the Bitcoin community doesn't necessarily do a great job being communicative. It doesn't do a great job with the hearts and minds piece. And I think. The predominant attitude, whether right or wrong, is Bitcoin doesn't need to change. You need to change. I think that's unwelcoming and that's, that's fine. But I think that kind of approach, and it's really the ideology and the mindset of the Bitcoin community, just makes it tough for people to embrace it.

• 52:24Anthony Pompliano?

  So I agree with you that that's what's happening. What if they're not wrong? What, what if actually part of the beauty of Bitcoin is that whether you like it or not, it is a better designed?

• 52:37Speaker 01

  Oh, it absolutely is, right? It's not a flaw, it's a feature.

• 52:40Anthony Pompliano?

  Yep.

• 52:41Speaker 01

  Agree with that. And I think to a hyper rational person and a thinker who's been in the space and has the time to really think about it, that, that works.

• 52:51Anthony Pompliano?

  Yep. It's the people who don't have the advantages of spending time, thinking.

• 52:56Speaker 01

  Time, yeah, freedom of thought. And I think that's the hard part. And again, institutions now getting on the Bitcoin bandwagon. If they become the mouthpiece that sells Bitcoin to the broader retail and institutional community, they're going to completely bastardize all those ideas and just steamroll everyone.

• 53:15Anthony Pompliano?

  Yep.

• 53:16Speaker 01

  And destroy this beautiful thing we spent 10 years building. And so I think either the Bitcoin community takes more ownership of the narrative, or someone else is going to do it for us.

• 53:27Anthony Pompliano?

  Yep.

• 53:27Speaker 01

  Or going to try to do it. And I just, I worry about the impact that will have. And that's the problem of social coordination, right? That's always been the problem. That's the fundamental problem Bitcoin itself with Byzantine fault tolerant consensus mechanism tried to design for. And it's, it's a very hard problem. Part of it's related to usability. Part of it's related to just the language we use. Part of it's related to the relative immaturity of the tools we have to buy, sell, trade, hold, store, learn about.

• 53:59Speaker 01

  Bitcoin, um, but it's a big problem.

• 54:02Anthony Pompliano?

  What do you think is the most important company in crypto over the next 10 years?

• 54:07Speaker 01

  Hmm, I was having this debate with someone the other day. Um, look, I think Bitmain has been one of these companies that like, has been so underappreciated and just has silently built an empire. Same thing with BitFury. We don't really talk about mining, but like these companies are building next generation, not just Bitcoin infrastructure, but compute infrastructure.

• 54:27Anthony Pompliano?

  Absolutely.

• 54:28Speaker 01

  Um, and for blockchain to work at scale, the networking layer has to be really robust, which is going to require a lot of like next gen compute infrastructure. And so we see the existing fabs are just starting to get on the ASIC and GPU mining bandwagon. Um, but these guys have already been there. And so I think that's, uh, that's going to be really interesting to watch that battle. The other company I think is really underappreciated. I mean, everyone talks about Binance and like how revolutionary Binance is. I actually think people aren't paying enough attention to platforms like Shapeshift and Abra. Um, and really their mantra is we want to enable users to transact and invest and trade in a private, secure way. These non-custodial designs I think are really important, um, to enabling crypto to really spread.

• 55:12Speaker 01

  If we want to truly create a better financial system, owning your own assets, truly owning your own assets is really important. And Coinbase and Binance and all of these platforms that facilitate trading, um, they've become central banks. They've become points of failure. So I think companies like Abra and Shapeshift and others in this vein who are enabling trading, holdings, storing, where you have full custodial, where you have full control and full discretion over what happens, really critical.

• 55:39Anthony Pompliano?

  Absolutely. Uh, let's go back to mining for a second because I think that your point about how under-valued these companies are, right? So the, the two things that, uh, are top of mind for me, Bitmain specifically. So one is a lot of people in the crypto community, when they see success, right? There's two paths they can go down. One is either they walk, right? And hey, you know, I made a bunch of money and, and, and I'm, uh, gonna take it and go enjoy life. Uh, or the other is they get really, really bold and ambitious, right? And I think that's what we're seeing with Bitmain, right? Is they're saying, look, we've had a bunch of success. We've been able to drive a bunch of capital, right? They, when they, uh, their last round they raised, I believe that outsiders of the company owned less than 5%, right? All of a sudden, now they're talking a little bit more about artificial intelligence,

• 56:24Anthony Pompliano?

  machine learning, compute that is used for non-mining or non-crypto applications. And it goes back to this idea that, you know, everyone says data is the new oil, right? And if data is the new oil-

• 56:36Speaker 01

  I threw up in my mouth for everyone listening. I have like vomit on my lips right now.

• 56:40Anthony Pompliano?

  Right, so it's everyone who says that, I always respond with, if data is the new oil, computing is the new steel, right? Because you actually need the infrastructure to let that whole data-driven world exist.

• 56:51Speaker 01

  So, so hold on, let's talk about this. So I think the most underappreciated layer of the crypto space is the network, network space, right? So, um, we think about ICOs and tokens, all the capital formation is happening at the protocol layer, right? Everyone's like, ah, protocols, protocols, amazing. And then we see, sorry, and then we see the application layer, right? That's where the VCs, like traditional VCs are like, I only do equity. And they're investing in applications. And then we see people trying to get around that by doing these app coin things. But no one's really focusing on that middle layer-

• 57:24Anthony Pompliano?

  Yep.

• 57:24Speaker 01

  -that enables protocols and technical design to get implemented in physical compute space. And we see this because these networks people are building are not robust.

• 57:33Anthony Pompliano?

  Absolutely.

• 57:33Speaker 01

  Like, look at what, well, look at what's happened with Ethereum, look at what's happening with EOS, look at like these new networks that are launching, they're not secure, they're not robust. And the problem is, is that if we're going to live in a world with thousands of blockchains, they're all going to require expression in physical compute space. And where's that infrastructure going to come from? How specialized does it need to be? And then does that actually become the new domain for competition? Because we can easily raise capital at the protocol layer and at the app layer, but at the networking layer, there's an actual physical constraint to implementation because there's a limited amount of compute.

• 58:04Anthony Pompliano?

  Absolutely.

• 58:05Speaker 01

  And so to me, investing in compute, and I want to create structured products that offer compute capacity to protocols, like if you raise money through an ICO for your protocol, you should be buying compute with that money. You should be buying dedicated networking infrastructure that's resilient and robust and that is secure. And de-risked so that your protocol can run in all sorts of adversarial environments.

• 58:26Anthony Pompliano?

  Well, if you think of the compute that's previously been available, it's been very CPU-heavy, right? Because that's what the the networks and the consumer applications, et cetera, required. We're now moving to a world where ASICs, GPUs are becoming much more valuable. And I think you and I have talked about, like, the idea to even go and start to get legacy infrastructure companies under your control and then start swapping the CPUs out for GPUs, ASICs, et cetera, super interesting. Now-

• 58:53Speaker 01

  It's also really, it's a cost of production game, right? So if we think about vertical integration, integrating power production with manufacturing, with actually operating a facility, right?

• 59:03Anthony Pompliano?

  Absolutely.

• 59:03Speaker 01

  This is the perfect oil and gas example. I spent, you know, seven years of my career, started my life in building big infrastructure projects that took 20 years to build and cost 20 to 40 billion dollars.

• 59:13Anthony Pompliano?

  Yep.

• 59:14Speaker 01

  We look at the crypto space, right? If this is truly going to be a massive industry that's heavily focused on building new network infrastructure, that's resilient, security, centralized, whatever, we need a physical expression of that. That's infrastructure financing. That's very different from financing a protocol. That's structured finance. It's principal press interest. And finding new ways to, to, effectively, like, infrastructure financing is all about reconciling the mismatch of cash flows, right? You end up using a bunch of cash, but you don't get any in until five, 10 years from now.

• 59:45Anthony Pompliano?

  Yep.

• 59:45Speaker 01

  Same thing in the crypto space. Very few people have had the vision and the foresight to understand that that networking space and that physical compute layer is so critical.

• 59:53Anthony Pompliano?

  Well, it was, it's actually how I got involved in crypto was-

• 59:57Speaker 01

  This is how you and I became friends.

• 59:59Anthony Pompliano?

  What was, so my family's been in the data center business forever, right? And what I saw was, in the traditional data center business, space, power, hardware, operations, right? And technology, by the way. Yeah, yeah. In mining, you have space, power, hardware, and operations. It's just the hardware's different, right? And the part that got me was, you can drive more yield and take the same amount of risk, right? And then you don't have to deal with customers.

• 1:00:27Speaker 01

  Well, and the yield, the yield component, that's because, like, right now, when people bid on compute space-

• 1:00:33Anthony Pompliano?

  Yep.

• 1:00:33Speaker 01

  On AWS, right? And- When they're doing that, there's a limited amount of margin you can capture. And really, the amount of margin you can capture is a function of demand, right? There's supply and demand component. What people don't recognize is mining is the same thing. But in addition to that supply and demand sort of price point, you also have this inflationary reward in a lot of these protocols, right? And so I think what people aren't understanding is the intractable relationship between protocol design and physical compute implementation. And this is where I think the idea of decentralization really isn't truly possible until we find a way to remove this compute infrastructure constraint. That's where I think like really, really new ideas around consensus design.

• 1:01:18Speaker 01

  So Algorand's gossip passing protocol, Chia and Space Mesh. So there's very different implementations of proof of space and time. Even I think some of what Filecoin is thinking about is really thinking about like, how do you disintermediate and decentralize the compute layer? And to me, that'll be the narrative that dominates crypto from like 2020 till 2025. I don't know, wild ideas, super fun though. I love, it's just such, these are such fun, thorny problems. And sometimes thinking about them like makes me dizzy, but yeah, it's really interesting.

• 1:01:51Anthony Pompliano?

  For sure. What do you think it's going to take for the quote unquote crypto world to completely blur the line with the non-crypto world? And it's less about is that a crypto project or not a crypto project? And it's just, is that something that users are going to use?

• 1:02:07Speaker 01

  Yeah, I think we haven't, this is the really hard part. Okay, so what I always say is we figured out how to create crypto assets. We figured out how to distribute them and sell them through these new forms of capital formation. We figured out how to speculate on them, right? Like most of the quote unquote infrastructure, the picks and shovels people are investing in are exchanges. It's about financial speculation. What we haven't figured out yet is how to utilize this stuff. And what we haven't figured out yet is the specificity between proof of stake protocol A, proof of stake protocol B, like what is like a fork, right? A fork is a very specific tool that you use for a very specific thing.

• 1:02:48Speaker 01

  What's the specificity for something like Bitcoin versus something like Zcash or Monero or Dash? Right? That specificity narrative hasn't really started to evolve yet because no one's really using this stuff. So I wrote this post back in March of 2018 called drowning in tokens. And my whole premise was that what we're doing right now is we're just pumping out a ton of supply, but there's no demand. There's artificial demand and speculative demand, but there's no utility demand. And without a real demand function, you can't really model growth. And, and that's the problem. Until we find natural demand for this stuff, it's very hard to see where the future might go. We can have ideas, but we haven't seen that many projects reach the mass market

• 1:03:33Speaker 01

  and start to eat away at the market share of payments companies or to generate an entirely new type of demand. We just haven't seen that yet.

• 1:03:40Anthony Pompliano?

  Yep.

• 1:03:41Speaker 01

  And that's what's interesting to me and it goes back to like these concepts that have been around in the business school community. Sorry where I come from for a while, like adoption curves, the innovation S curve, right? It's really trying to think about, we're so early, we're either so early or we're so late in the adoption curve. I actually don't know anymore. Like maybe the total addressable market for Bitcoin is really small. Maybe that's just a reality. And I think in its current iteration, the total addressable for market, market for Bitcoin is actually quite small because it's too hard to use, right? There are a limited number of people with the competency and the capacity and frankly, the interest of using it in its current iteration. So then it's technical innovation, but also product innovation that creates a larger addressable market.

• 1:04:25Speaker 01

  And I don't think we've really started to think through that yet. People had ideas, like when earn.com, when back when it was 21, came out with their initial idea. That was a cool idea at the time, right? Like, I actually thought that that could have been an interesting way to spread adoption. And I know people laugh at the idea of mining with a toaster. That's kind of the narrative that stuck. But it was actually a really cool idea. It was just way too early. And the form factor, the 21 computer, was way too hard.

• 1:04:51Anthony Pompliano?

  Yep.

• 1:04:51Speaker 01

  And I think they realized that and they were like, this is a great idea, but probably like

• 1:04:54Anthony Pompliano?

  Too early.

• 1:04:55Speaker 01

  10 years too early. Yeah.

• 1:04:57Anthony Pompliano?

  Got it.

• 1:04:58Speaker 01

  Sorry, that was a, like, I'm not very good at answering questions. I just ramble.

• 1:05:02Anthony Pompliano?

  Listen, you're, you're, you're speaking your mind. I love it.

• 1:05:06Anthony Pompliano?

  So, last question for you. What is the one-

• 1:05:08Speaker 01

  Do I get to ask you questions at the end? Can I do like a rapid fire-

• 1:05:12Anthony Pompliano?

  Sure, go ahead.

• 1:05:13Speaker 01

  Three, three questions for pomp.

• 1:05:14Anthony Pompliano?

  All right, go.

• 1:05:15Speaker 01

  No, no, you ask me your last question.

• 1:05:17Anthony Pompliano?

  What, what's the one thing you do on a regular basis, either daily or weekly, that you think it has done the most to inform your opinion about the space?

• 1:05:25Speaker 01

  Uh, go hang out with non-crypto people. Go to non-crypto events.

• 1:05:28Anthony Pompliano?

  Interesting. Any specific types of events or people?

• 1:05:30Speaker 01

  Yeah, I love hanging out in the, um, consumer retail space. Like, I think, uh, retail's going through mass, mass shift. Um, the shift from physical to digital and digital to virtual is a really interesting one. It's effectively what we're trying to do with crypto, right? We're trying to take money from being physical and digital to being truly virtual and virtually native, digitally native. Um, and that's also happening in the retail space. And so I think it's really interesting to spend a lot of time in the retail space where everything people do is driven by purpose and brand, right? Like, retail's brand first, execution later. Um, and everything in crypto is idea first, brand like never. And so spending time in the consumer space is really interesting. Um, spending time in, uh, the arts and sort of music space is really interesting.

• 1:06:15Speaker 01

  There are a lot of these really interesting industries that are going through fundamental shifts in how they reach their market and sell and produce and distribute product. And to me, it's really interesting to hang out with people in those communities and to go, like, I don't go in like, let me talk to you about crypto. Like, that's, I, I hate that. I have gone to so many events where people are so pedantic and they're like, let me explain how Bitcoin works. I'm like, these people don't care. I just like to go in and ask people, I'm like, how do you go about creating a strong brand? What do you think about every day when you go to work? Like, if you're the CMO of one of the world's largest retail brands, what do you think about? Um, what do you think of crypto? Like- What's your, what's your perception of it? And what you'll find is people's perception of cryptos, not that flattering.

• 1:06:59Speaker 01

  They're like, it's intriguing, it's interesting, but it feels real gross. It feels unapproachable, feels weird. So to me, there's like this really interesting kind of brand and narrative problem. And so it's just good to get out of the crypto bubble and just go spend time with people who think about a totally different set of problems that are very analogous to what we're going through. So I find that fun.

• 1:07:18Anthony Pompliano?

  My, my favorite people in those scenarios are the people who have like their professional perspective, right? And so they're like, oh, you know, it's all the people in the basements and, you know, bad actors, all the stuff. And then as you're walking away, they're like, hey, by the way, which coin's gonna go up?

• 1:07:30Speaker 01

  Tell me what shit coins.

• 1:07:33Anthony Pompliano?

  It's like their personal question on the side.

• 1:07:35Speaker 01

  But blockchains don't change human nature, right? Like, what do people want? They want a get rich quick button. You know how Staples has like the red easy button? We all want that money button where you just hit the button and you're like, give me that sweet, sweet cash, baby. So I'm not going to say what I said earlier, but the flash cash, you know?

• 1:07:52Anthony Pompliano?

  Yeah.

• 1:07:53Speaker 01

  Well, yeah, I'm not gonna say that.

• 1:07:54Anthony Pompliano?

  Very true.

• 1:07:55Speaker 01

  Because that's not acceptable on this podcast. I was told to keep it PG, I did not obey. But, but I think that mentality, right? Like inherently, human beings are self-interested.

• 1:08:04Anthony Pompliano?

  Of course.

• 1:08:04Speaker 01

  What do I want to do? I want to put in the least amount of effort and get the most amount of value out. Crypto is perfect in that way. And that's why it's kind of been the perfect Trojan horse. Everyone's like, I can't really talk about this, but they're like, I want to make money. I want to be rich and I don't want to do shit to get there.

• 1:08:19Anthony Pompliano?

  It's a great incentive.

• 1:08:20Speaker 01

  It's the great American dream.

• 1:08:21Anthony Pompliano?

  Yep.

• 1:08:22Speaker 01

  America, baby.

• 1:08:23Anthony Pompliano?

  What, what, uh, I'll let you ask me one question. What, uh, what question are you gonna ask? Three, I'd get scared.

• 1:08:29Speaker 01

  Okay, hold on, I wanna, question number one. I'm gonna be incendiary because I can be. Okay, question number one. You have gone from being fairly unknown in the crypto space. I would say like when I first met you, I was like, who's this pomp guy? To now people talk about the pomp as though it's an adjective, which I love, like kudos to you.

• 1:08:48Anthony Pompliano?

  So ridiculous.

• 1:08:51Speaker 01

  So you have engaged in a very effective growth marketing strategy.

• 1:08:54Anthony Pompliano?

  Yep.

• 1:08:55Speaker 01

  What's your thought process there?

• 1:08:57Anthony Pompliano?

  So.

• 1:08:59Speaker 01

  The man, the pomp. Tell us more.

• 1:09:00Anthony Pompliano?

  One is, I have a very unique advantage in that I've worked on growth at large technology companies, right? So I understand how.

• 1:09:10Speaker 01

  You understand the pomp.

• 1:09:11Anthony Pompliano?

  I understand how a lot of the algorithms work, etc. I think that two is I'm a huge believer that audience is currency, right? In terms of if you have an audience, it doesn't have to be everyone, but if you're able to find like-minded individuals, you can use that to your advantage, right? And for those around you to their advantage as well. And then I think the third thing is, and I get a lot of shit frankly for this, is I think that a lot of the people in the space are very heavy and very talented on the technology side, and so they tend to be.

• 1:09:44Speaker 01

  Or they think they are.

• 1:09:46Anthony Pompliano?

  Well, but they tend to be.

• 1:09:47Speaker 01

  There's a lot of pseudo-intellectual bullshit that gets said around like, nah, you're wrong.

• 1:09:51Anthony Pompliano?

  Well, and I think that's every industry, but probably even more here, right? And so what you get is you get very like technical jargon, you get like the overly, you know, just kind of heavy conversations.

• 1:10:02Speaker 01

  It's unnecessary. I'm just like, dude, no.

• 1:10:04Anthony Pompliano?

  And so when I saw this, I said, you know, look, our, our business is to manage money for investors, right? Mainly institutional investors and help them get access to what we really think of as the digital age. So not even the blockchain age, but we think that blockchain and cryptocurrency, Bitcoin, etc. is like 90, 95% of that today. But I would argue that things like Robin Hood or robo-advisors, etc. all are, you know, analogous to this world. And so the one area that I saw that nobody was doing a good job of, or at least not doing it at scale, was can you take these highly technical concepts and basically boil them down to the simplest form and then share them with an audience? And so it's not really going after hearts and minds, right? Because I think that that's

• 1:10:50Anthony Pompliano?

  a piece of it, right? Is if you do this successfully, you may get some hearts and minds. But really, it was just, I'm not smart enough to look at a very technical white paper and understand every single detail.

• 1:11:01Speaker 01

  But I want to reject that notion for me. I think people in this space are like, oh, well, I'm not technical. Oh, I'm not smart enough. Yes, you are. Like, growth marketing is a highly technical field.

• 1:11:13Anthony Pompliano?

  It is.

• 1:11:13Speaker 01

  Every field has a technical component to it, and I categorically reject the notion that being technical in a non-engineering field's not valuable. I think you're super smart.

• 1:11:23Anthony Pompliano?

  Oh, no, no, no.

• 1:11:24Speaker 01

  I just give you a compliment. I don't like this. I take it back.

• 1:11:27Anthony Pompliano?

  Just to clarify, it's not that I think that non-technical people aren't valuable. What I think is that if you sit me in a room and you say, hey, explain, you know, zero-knowledge proofs, and you bring an engineer in, they're going to be able to explain it better than I am at a very deep, technical level. Now, the difference is-

• 1:11:42Speaker 01

  But that's what they're paid to do.

• 1:11:43Anthony Pompliano?

  Exactly. Their audience is other people like them who understand that deep, technical language. My audience is very different. And so I think that by focusing and understanding, here's who I want to talk to, right? Now, here's, so that's helpful. I think that that, you know, Twitter, all that stuff, that's where a lot of those people are who want that message. Now, the flip side of that, right, and the people who detract from that message are the people who are the deep, technical people who are like, you're dumb, right? Like, you're using simple language. You don't understand it.

• 1:12:11Speaker 01

  Right.

• 1:12:12Anthony Pompliano?

  And so it's just the disconnect between, I'm talking to a different audience, right? And so at first, you know, when somebody, you know, look, the internet's a wild place.

• 1:12:20Speaker 01

  I've given you shit on Twitter. I give you, the Venezuela thing, I was like, I love you, but-

• 1:12:25Anthony Pompliano?

  Look, we can talk, we can talk about it. You ready? So, so-

• 1:12:27Speaker 01

  But do you want to, do you want to lay the context?

• 1:12:29Anthony Pompliano?

  Yeah.

• 1:12:30Speaker 01

  So, Pomp, so let me give you my reaction.

• 1:12:31Anthony Pompliano?

  Oh, this is great.

• 1:12:32Speaker 01

  So, we're gonna, like, everyone loves tension. I'm just gonna throw it out there. I dish it. I also take it.

• 1:12:38Anthony Pompliano?

  Go, go, go, go.

• 1:12:39Speaker 01

  Okay, so Pomp put out this tweet, I think it was like, March, right?

• 1:12:42Anthony Pompliano?

  Yep.

• 1:12:42Speaker 01

  So Venezuela issued, it's on cryptocurrency called Petro that was gonna be backed by its petroleum reserves, right? And I like to call them hunger tokens, which is terrible. It's like, it's a bad situation.

• 1:12:55Anthony Pompliano?

  But you have a legitimate reason for describing it that way.

• 1:12:58Speaker 01

  Yes, but, but I think what, what troubled me is Pomp put out this tweet, and you were like, mister, tokenize the world, spread the virus, which I love, right? Easy, succinct messages, but I do think, like, they rile up the crap.

• 1:13:09Anthony Pompliano?

  Spread the virus sounds way worse than the virus is spreading.

• 1:13:13Speaker 01

  You're infectious. I love that. It's a great compliment slash insult. So, so Pom put out this tweet that said,

• 1:13:23Speaker 01

  "The virus is spreading. Like, I look at everyone adopting blockchain and tokenization. Best example, yet Venezuela creating the petro." And what you said factually was true, but it was a terrible example.

• 1:13:41Anthony Pompliano?

  Yep.

• 1:13:41Speaker 01

  And I think, again, it goes back to like, there are things that are correct technically, and then there are things that are correct morally. And my objection wasn't on the correctness of the statement from factual perspective. It was the fact that you had a really big audience and the statement from like a moral and subjective perspective was just, it felt like implicit endorsement of something that was subjectively horrific.

• 1:14:06Anthony Pompliano?

  Absolutely. Yeah. And I think that, you know, when you, when you put it in that light, first it was, hey, I didn't think that me saying this obviously is me endorsing the Venezuelan government, right? And so-

• 1:14:18Speaker 01

  If you thought that, I think we would have launch problems.

• 1:14:22Anthony Pompliano?

  But, but, but I think part of it too is, and this is something that, you know, look, I think we struggle with a lot internally. We talk about when you're in an area where experimentation is very important, right? There's going to be people who try things that cross the line or, or push to an edge that you don't agree with, right? Where's that moral line, etc. And so it's, how do you encourage experimentation? How do you speak out against the bad applications of the technology?

• 1:14:48Speaker 01

  So that's like an expression of there are no sacred cows. Uh, right? Like there, we should be able to experiment with anything and everything, even if it pushes the boundaries of what currently is socially acceptable.

• 1:14:59Anthony Pompliano?

  Well, so I think that-

• 1:15:00Speaker 01

  Okay.

• 1:15:01Anthony Pompliano?

  I think the thing that we struggle with is-

• 1:15:02Speaker 01

  I can kind of buy that.

• 1:15:03Anthony Pompliano?

  Well, here's the thing that I think that we struggle with is, so there are probably sacred cows, right? What if we actually don't understand everything well enough yet to know where those sacred cows are?

• 1:15:13Speaker 01

  Well, we don't know anything.

• 1:15:15Anthony Pompliano?

  Right?

• 1:15:15Speaker 01

  That's really the crux of this conversation is-

• 1:15:18Anthony Pompliano?

  Absolutely.

• 1:15:18Speaker 01

  I know nothing. All I know is that I need to ask better questions. And so, and then I need specificity. So people make statements like, oh, our protocol's decentralized. A specific qualify what decentralized means. So I just think- Better questions and like, let's accept, I agree with that. We don't, we don't know what we don't know.

• 1:15:36Anthony Pompliano?

  And, and here's the really bad part of Venezuela or even other areas where a lot of technology is being experimented with and, and, applied is actually like, if you looked at their blockchain Petro solution versus what they're doing outside of the blockchain space, I think that there would be a really deep, you know, kind of emotional argument that people would have on either side as to which one was worse. Right? Which is almost gets you down into now, you're not just talking about technology. Now you're talking about, you know, human rights, sociology, psychology, power, government.

• 1:16:10Speaker 01

  And this is, so, one final plug, um, cause I know we're getting really long here. This is why representation on teams that are building technology matters. The technology I use today was largely designed by people who don't look like me, who are not like me. And the problem is, is if we're going to fundamentally disrupt money, it can't be a room of people who all look, think, feel the same. It has to be representative of the people, the seven billion people, soon to be nine billion people who are going to use it. And that is the fundamental problem is how we design technology impacts how it gets used. And there are material, social, political, economic and, and moral implications.

• 1:16:55Speaker 01

  And this is the problem with the traditional, like, I want to blow shit up because I'm tired with the existing power structure. Because it does not serve me or people who look like me. And it's 2018. The fact that we're fucking celebrating that women can be GPs at venture funds is pathetic. It's so like, people are like, oh, let's congratulate ourselves for a female JP. I'm like, it's 2018. We've had female presidents in almost every country except America. Like, let's get with it. This isn't, we're sad. We're pathetic as an economy.

• 1:17:24Anthony Pompliano?

  And the part that always, you know, uh, when it comes to, so.

• 1:17:27Speaker 01

  That shit is sad.

• 1:17:28Anthony Pompliano?

  So that the female argument, right? The immigrant argument, et cetera. Uh, the part that I always have a disconnect with people is, it's data. Data proves that it is actually true if you have a more diverse team, right? And I forget all the data points, but it's like, if there's a female on a public board, for example, the company performs better, right? If, you know, and you just.

• 1:17:50Speaker 01

  People are like, oh, diversity, it's so hard. I'm like, you hire someone who has a vagina? Like, step one, hire someone with a vagina. Step two, give them authority. Step three, give them capital. Like. It's a three-step solution.

• 1:18:03Anthony Pompliano?

  There goes the PG rating.

• 1:18:05Speaker 01

  Jesus, I should say Buddha, that might be offensive. It's like, I feel like I'm taking crazy pills because I always talk to her, like, it's so hard. It's so difficult. Like, how do we change the problem? I'm like, it's a three-step solution.

• 1:18:22Anthony Pompliano?

  Absolutely.

• 1:18:22Speaker 01

  Find people and hire them, one. Two, give them authority and real power. Three, give them money. I don't know, that's like, that's pretty simple.

• 1:18:32Anthony Pompliano?

  Straightforward.

• 1:18:33Speaker 01

  But look, what do I know? I'm just a crypto person.

• 1:18:38Anthony Pompliano?

  We will end there because I think that is, that is the general feeling if you spend time in the crypto world and with, you know, traditional asset management, et cetera, is, you know, the world as we know it going forward, I think is going to look different. It's just trying to figure out what it, what is it actually going to end up being?

• 1:18:53Speaker 01

  And that's the fun part.

• 1:18:54Anthony Pompliano?

  Absolutely.

• 1:18:55Speaker 01

  I'll see you on the flip side.

• 1:18:56Anthony Pompliano?

  Thank you so much for doing this.

• 1:18:58Speaker 01

  Thanks, Tom.

• 1:19:01Speaker 02

  Hey, everyone. If you like this podcast and want to help crypto take over Apple, Spotify, and wherever else you're listening to it, please do us a favor and rate, review, and subscribe. To review, simply go to the Off the Chain homepage and scroll down until you see those five blank stars. Taking 15 seconds to fill those stars in and leave a quick review goes a long way for us and the entire of the crypto takeover. See you next time on Off the Chain.