Crypto’s Next Chapter | Jeff Dorman

Transcript

this episode is brought to you by pair swap the leading aggregator to find best prices across various dexes you'll hear more about them later in the show [Music] welcome back to another episode of empire today we are joined by the b-lister mr mike ipolito my co-founder at block works santiago i'm kind of you know santiago's taking a break from the pod for the day no he had a a couple board meetings to attend to so mike is mike is stepping in uh and today we are very lucky to be joined by jeff dorman the cio at orca one of the most respected uh funds in the space but really just jeff is in my opinion one of the most respected and thoughtful um and

often contrarian investors in in all of crypto i spent about 15 years maybe maybe a little longer on wall street i think at merrill lynch lehman brothers citadel and then joined arca back in 2018 and has just been leading the charge for for crypto investing since then so jeff welcome uh welcome to empire my friend thanks for having me and thanks uh i i got a much more ceremonious uh uh intro than just you calling being called a b-lister so i appreciate that that was nice of all the monikers that jason has given me over the years b-list is one of the kind of ones so i'll check it out yeah you should see what i call them on uh yeah when we're not recording here jeff so awesome jeff can you see this uh can you see this chart here yes awesome so this is what i want to jump into first we just had travis kling on

the podcast and and this was one of the big topics that we talked about is just the correlation between bitcoin and the nasdaq uh right now there's about a 95 correlation if you look back over the last couple of months it's really trading in bitcoin is trading in tandem with with the nasdaq and my first question for you is just when does this snap when does this correlation break away well don't forget i mean there's a reason that this is so concerning to people right it's concerning to people because we've been calling bitcoin and uncorrelated asset for the last five years so all of a sudden because for the last four months it's so highly correlated to the nasdaq people are freaking out but the reality is you could have had this exact same conversation five different times with five different assets over the last five

years you could have you could have run the same chart versus the us dollar three years ago you could have run it versus the chinese yuan two years ago you could have run it versus um gold four years ago right the definition of a uncorrelated asset is that the correlations you know are are not consistent and that's the same thing today right just because we have a high consistency with the nasdaq right now that that also is not a consistent relationship because that wasn't the case you know five months ago two years ago four years ago so it will eventually break um you know just like it has with every other asset that we've shown high correlations to over the past five six years in terms of when or why i think a lot of it has to do with the type of people that are in the market

right so when you have um new entrants to the market and largely uh most of them are macro funds um specifically who are getting into bitcoin right you have a few traditional you know credit funds and equity funds here and there but for the most part most of the new money that has come into this space has been macro fund right macro funds are more correlated than necessarily the assets they trade meaning they're all doing the same thing right they're all looking at rates they're all looking at the dollar they're all looking at commodities so they're all doing the same thing and when you have retail largely you know leaving the market for the last three to four months you've had most of the new money coming into digital assets coming in specifically into venture rather than the liquid funds you just have an environment right now where it's being dominated by a few

players that all do the exact same thing and look at all the same things so to me it has nothing to do with bitcoin versus nasdaq it has to do with when new players are going to enter that are not macro funds right so for instance fidelity just talked about you know having allowing uh some of their 401k um customers to be able to buy bitcoin um you know who knows if more corporate balance sheets will get involved in bitcoin who knows if more governments will get involved um you know there's all these different players that are not touching bitcoin today that could be in the future and if that happens that will be what breaks the correlation i've there's a lot to unpack there jeff so i got a couple questions for you just because you're one of the few guys uh who can both speak deep in the weeds about crypto but also uh you know speak

compellingly about the macro environment as well um so you know so one you know one thing that you touched on there is kind of this this idea of correlation between uh you know the nasdaq and and crypto and maybe some of that is like common ownership right so that kind of dan moorhead quote when he got into uh you know uh hedge funds back in the day it was alts because they were actually uncorrelated but now everybody owns the same stuff right so this is this element of common common ownership uh and then you know the higher level thing is just the fed in general and i've heard you kind of say in the past like one of the reasons you're excited to get out of wall street is felt like you were just analyzing what the fed was saying every six weeks and it's not that's not

ultimately very exciting but you know the big the big thing that's changed over the course the last year is inflation in general right and the fed hasn't had to fight that in a very long time so my question to you is just you know do you view the fed as being in control of the current situation as it pertains to inflation and does that matter you know when it when it translates into the crypto market sure and first of all you know let's also remember that you know most digital asset participants are not coming from traditional finance right so they're learning some of this stuff i remember six months ago when you know we had a really bad jobs report and all of a sudden people were like oh you know you know maybe there's another jobs report coming out like you know people didn't know that there was weekly jobless claims every thursday at 8 30

a.m and that there was a monthly report you know every month um you know but they learned it they're like okay right now this is driving the market so we need to pay attention to it right same thing most you know people who are trading bitcoin and other digital assets probably weren't too concerned about you know each of the fomc meetings every six months or every six weeks for the last you know three years but you know since the inflation print in november of last year and all of a sudden everybody cares about it every day right you know most likely just like we talked about the correlations you know same thing with these drivers they come and go right right now this is the only thing people care about but it won't be the only thing people care about you know six months from now 12 months from now with regard to the fed being in control

i would say absolutely not right i mean i think you can see that and you know the fact that we have a eight and a half percent year-over-year cpi print and we have a you know quarter percent fed funds rate right that's you know by definition that means they're not in control right now um you know that that should be i think the last time we had cpi in the eight and eight and a half percent range was something like in the uh i want to say in the early 80s and the fed funds rate was like 14 so yes clearly they're not in control right now um now the flip side of that is that they can't really be in control right most people including the fed themselves will tell you that they really can't do anything to fight inflation right they you know raising

rates whether it's 50 basis points at a time or 75 basis points or 25 basis points there's not a whole lot they can do about rising oil prices or about rising food prices so it's a lot of it is symbolic and there's a reason that if you look at the last three weeks right before the uh the next fmc meeting is may 4th today is april 26th um you know they're in a they're in a a blackout period right now for the next you know eight days they can't talk but before that every single day there was two or three fed speaker fed governors that were speaking right that's not normal they don't go out there and talk every single day for three weeks the reason they're doing that is because they know it's less about the rates and the rate hikes as it is about the narrative if they go out

there and tell everybody we're in control we're going to raise rates we're not going to let this get out of control then it keeps people from freaking out right inflation is more of a mindset than anything else if you if you think that your paycheck uh is not going to be worth as much two weeks from now as it is today like if you're in a hyperinflationary environment like you know in venezuela or south africa or turkey you know in years past you're literally spending your money the second you get it because you're worried that things are going to be too expensive you know a day later two days later or a week later um that's obviously not the way the prices aren't rising organically that fast they start rising that fast because people are freaking out and spending much faster so what the fed's job is to do is to get this to make sure that

doesn't happen right they're trying to tell everybody hey we got this under control hey rate hikes will slow things down hey we'll have a solved landing to get people to be like yeah you know inflation's high but it's not like i'm going to rush out there to buy milk the second i get paid because i'm worried that it's going to be 20 cents you know more expensive tomorrow so a lot of what they can do is just talk markets down and that's what they're doing and that's why you see everything from bonds getting crushed to oil getting crushed to equities getting crushed to crypto getting crushed it's all the same thing right it's like that is what that is the only thing they can do right now is to try to dampen the financial markets to basically lower people's purchasing power to make them not go out there and

just start spending like crazy the rate hikes themselves are symbolic at this point and in fact you could argue that it's already done right the the two year is already at 270 it's already priced in um you know everything that's already everything they're planning to do is already priced in by the markets anyway so i guess then you know knitting those two things together right let's say the fed has woken up and said whoa we are way behind inflation right if you go back to the last comparable period where we had this this rate of inflation in the u.s there was the 1970s and 80s and fed funds was at 14 or whatever it was 10 years over 18 i think um so let's say we have to slow we have to slow things down we have to crush demand and essentially cause a recession right um

so if you know if you're looking and it's you know in terms of sentiment it's like this like the most bearish i can ever remember it being the most consensus i can ever remember it being for everything is going down right and you're starting to see that pain finally show up in in stock in the stock market um we also just talked about there's a huge correlation right now like record high in between the nasdaq and crypto so my question to you is if the fed is indeed going to kind of pull the fire alarm and want to slow everything down in more traditional financial markets is that necessarily going to have to translate into crypto at least over the next like let's say six to nine months well let's let's take it a different direction which is you could argue that digital assets are performing pretty admirably in the face of what's

happening here right so let's let's you know let's look at some numbers for a second this is updated through sunday just because i wrote about it just the other day but if you look at the returns um you know over the um the last year to date let's just look at it right bitcoin was down about 14 as of sunday the nasdaq was down 18 long bonds were down 20. um you know emerging market equities were down 14. uh euro equities were down 16. you know it that's a pretty admirable performance and if you think about like why do hedge funds exist in the first place right hedge funds convinced pension funds and endowments that hey we can capture all or most of the upside in the market but we'll protect you against that downside and you know even though hedge funds have underperformed for basically the

last 12 years because the market went straight up from 2009 to 2021 people still invested in hedge funds or you know why because they were convinced that okay well when we need them when the market turns they'll outperform and we want that out performance basically what they're saying is we want something that has high up capture meaning you're going to capture most of the upside and something that has low down capture meaning you're not going to capture a lot of the downside well digital assets just as a whole as an asset class basically just did exactly what every investor is looking for the last two and a half years during everything going up digital assets outperformed everything under the sun on the way up but on the way down they're performing in line in some cases even better than you know tech stocks and other ways so what

what's going to happen here is of course right now like you said sentiment is really bad right now nobody wants to touch anything right now there's high cash balances there's high shorts you know every fear and greed index is at the lows right it looks like no one's ever going to invest ever again right you know that's that's usually the best time to invest when nobody wants to but um you know it looks like you know the world is ending of course it probably isn't right not every you know 10 or 20 correction means the world is ending but um eventually when something changes where that sentiment changes and where people start to get aggressive wanting to want to buy assets again investors are going to look at that performance they're going to say hey you know what i need to own i need to own some digital assets because the last five years it just showed exactly

the kind of characteristics i'm looking at it has high up capture and it has very low down capture so to me that's the most important thing right now is that you know when everybody pulls their money out it doesn't matter if you're in a money market or you're in you know the most riskiest stock or you know digital asset in the world when people pull their money out nothing's going to do well but when they put the money back in you're going to start to see flows go in dirt in certain directions and i think it's pretty clear right now that you know russia and china is pretty uninvestable or at least not very high on anyone's list right europe because of how much they import how much reliance they have on energy abroad is pretty not very high on anyone's list right now uh

bonds not very high on anyone's list right now given you know we're we're heading towards uh you know continued rate hikes that doesn't leave a whole lot that leaves you know u.s equities that leaves u.s real estate that leaves digital assets and i'm sure there's some things i'm missing here but you get the idea right fund flows generally drive performance more than anything else and i think it's pretty clear that the the needle is moving in the right direction for digital assets in that regard jeff you you mentioned so much so mike has asked a lot of like macro related questions about the fed and you mentioned like russia and ukraine and then there's these macro indicators like the central banks hiking interest rates i've heard you talk about censorship and just financial asset censorship in companies and countries seizing assets how much of that narrative

uh do you think has kicked off this like uh crypto outperforming relative to to other assets yeah and it's always hard to tell in the moment but but i think i think a years from now we're going to look back and it's going to be very obvious that february and march of 2022 were a massive turning point with regard to understanding and and interest in owning better assets like digital assets um you know starting off with what canada did you know where they basically said you know if you're part of this trucking convoy we're going to freeze your assets okay that's weird right that's not the kind of thing you'd expect to happen in canada um to you know obviously russia you know with uh putin just you know unilaterally deciding hey we're gonna tank our economy and the ruble just to you know attack ukraine to the u.s and and europe basically

putting sanctions on anybody who is in russia um to even what the lme did right the london metal exchange basically just saying you know what we're going to just cancel these trades and you know if you had positive p l because of nickels rise because you were uh uh you know a long we're just gonna cancel it it's not yours anymore you start to put those things together and you say wait a minute i thought my money was my money and now i'm finding out that my money isn't actually my money my money is the bank or the brokerage account or the government's money and it's really their liability to me and whether or not they're actually going to pay me back i have no idea and you know this is the kind of thing that most people in the digital asset world have been talking about for eight

years but it doesn't resonate with most people when it doesn't affect them right now that it's starting to affect people that are more like them right your russian oligarchs your canadian citizens your you know people in europe all of a sudden you start to say wait a minute this could happen to me too and i don't think i'm okay with that so you just you start to think about the hypocrisy of what's going on and the fact that you don't actually own your assets and it makes you realize maybe i do need some protection there maybe i do need to own some stable coins or some bitcoin or some ethereum or something else and i think that is starting to resonate all over the world and a year from now we're going to point back to that and say yeah that was obvious do you view um you know one you know period of time in history that people

point to as being really influential is the closing the gold window right and that's when we kind of departed with all this notion that we're on some sort of gold standard and no it's all just fiat backed right in general uh you know you kind of heard some proclamations recently that the fx seizures specifically of the russian central bank assets right that this was the closing of the fx reserves window right when if you think about the ability that there's a great thread from punk 6529 on basically the ability to transact underpins the rest of your freedoms right the ability to free speech and right to assembly and freedom of the press doesn't really mean if you have no money right and to transact and actually accomplish any of that stuff so you know do you view this as you know people kind of waking up and saying wow

this is not actually my stuff and we actually need something else that's more solid to underpin the global reserve currency maybe it's bitcoin maybe it's some crypto thing maybe it's commodities whatever it is but do you view this as being like the starting gun essentially for countries to think about that yeah i mean certainly maybe i mean that's probably a bigger question than than what i have any real knowledge to answer but i think i think yes but i also demand answers jeff well i i think exactly i i think i think the better way to think about it is for the most part people just trust what works right if it works people trust it right you know the us dollar for the most part works so when people just trust it right if you actually you'll peel the onion and look what's behind the us dollar there's not a whole hell of a lot right we all know there's

nothing there other than the you know the will of the us government and the military um you know the same thing would be true of an algorithmic stablecoin right you know it's a joke to most people until after years it works and finally they're like yeah i don't really care what's behind it you know it works right i think the same thing is i mean that's mostly what you know fx and currency is right it's a trust-based system i'm not really sure if the answer is making sure there's always a hard asset behind it so much as it is that you know you can see in this like last decade and even more so in the last few months that a lot of that trust is eroding and when trust erodes people want a new system and you know if you back it by something it just leads to the next question well then people might stop

trusting the thing that it's backed by i'm not sure just a backing itself is the answer but i do think that um you know it's it's clear that people are losing faith with the idea of just blindly trusting your governments your corporations your banks and brokerages i think one interesting way to maybe frame that too is just the basic idea of like property rights in general like when you talk about bearer assets right that's actual property rights and people own that um and there have been these studies done uh you know on just what makes an economy or are successful in general and people tend to point to these very political things like oh it's a democracy or it's not a democracy but in reality there's a much higher correlation between strong property rights and courts that uphold those property rights um as opposed like a

causal indicator of what makes an economy successful you could trace that to like what we're kind of talking about this very macro sense like currencies and the dollar and all that kind of stuff but then there's maybe like the more web 3 ethos like web 2 versus web 3 where you own the digital assets that you're creating and i'd actually this may be like a departure from what we're talking about but i saw you wrote a post uh that twitter should issue a token so i'd be curious to get your whole standpoint on like the like the elon twitter acquisition and like and like what you know what you're writing about in that post in general because i think that kind of plays into this yeah sure i mean you know back up for a second i think i think ownership is all that matters right and you can point to a lot of

what has happened in the last 20 30 years right in fact i think there's a great uh twitter handle that's like you know what happened in 1971 like basically since 1971 everything has just gone downhill and that's basically when we removed from the gold standard and all of a sudden wealth inequality you know became massive and you know basically you had to own a house or own equities to to keep pace with inflation and everything like that but ultimately it comes down to ownership right whether you own stocks or you own gold or you own a house or you own something well what i think is so powerful about digital assets and i've said this you know over and over again is i think you know i would say i think digital assets are the greatest capital formation and customer bootstrapping and wealth of quality function we've ever seen

you know it is the first thing that has ever basically fully aligned all of the participants of a company or an organization and i've used this analogy you know many times so apologies for anyone who's heard it before and is repetitive but like you know take mcdonald's for an example um there's no reason that if you're a mcdonald's customer that you have to be a shareholder or vice versa and in fact that's probably if you look at like a venn diagram that's probably one of the least you know overlapping circles of a venn diagram of any company you'll ever see right would be between a mismatch of their customers versus their shareholders that's crazy right that means that you as a frequent customer of mcdonald's or you as a worker at mcdonald's you are doing all of these things to make mcdonald's what it is and sharing

in none of the ownership or the property rights or the financial benefit of that success and you know you can look at tons of other companies that are the same thing right from airbnb to doordash even amazon right i mean how many amazon prime members and delivery people are not benefiting from amazon shares what we're doing with digital assets is we're largely you know giving that ownership to the people who make these projects and companies work you know let's look at facebook right if you facebook famously 15 years ago or 13 years ago said we figured out growth hacking faster than everyone else right we basically figured out that if our uh if our users like 10 posts or follow 10 friends within the first week they're basically going to be

a customer for life so facebook did everything they could uh with their ui and their ux to basically force or trick their users into doing those actions right because then they would become a customer for life but none of those users are or did got anything for it right they weren't being paid for it they weren't receiving any benefits for doing those things it was just you know basically one giant ui ux trick that's ridiculous right you know the whole idea of yield farming and digital assets or this idea of earning um you know for being a participant is that basically you get the shares it'd be the equivalent of hey if you do those actions facebook wants you to do they're going to give you some facebook shares for doing it well that's basically what we're doing in the digital asset world right if you're an early depositor to a

defy application or if you're an early trader or you're an early user of looks rare with nfts or you're you know an early gamer you're going to be paid for those actions right they are rewarding you for doing the actions that they want you to do and that is how you solve for wealth inequality is you you basically reward people for for actions so let's look at twitter right twitter is not you know first of all the twitter stock price obviously hadn't gone anywhere and you know since the ipo which is why people have been so angry and why musk came in but you know the people who made twitter go from you know a few you know active users in san francisco to 300 million you know global daily active users they're getting nothing out of twitter's success even though they're the ones who make it possible so why wouldn't you introduce a

token there where it's like hey what are the actions we want people on twitter to do well we want you to engage in content great we'll pay you for it hey we want you to write content cool we'll pay you for it um you know hey we want to uh you know have discussions on on twitter spaces or you know you get the idea like it wouldn't be hard for executives uh in twitter to say what are the things we want people to do and let's go reward them with it and then we can make that token uh not only you know quasi equity in the form of of of getting some of the kickbacks from the revenue and profits of the company but then you can also make it utility hey you can redeem your twitter tokens to post or you can redeem them to

uh you know amplify a post or boost it i mean there's all these different things you can do and i haven't thought through all of it but you get the idea right like this is the perfect company for ownership or property rights or benefits to be shifted from shareholders to the people who make it work on a daily basis and i think they would be absolutely crazy not to implement that jeff what's the problem that you're trying to solve for here because if i'm putting it on a almost like a web 2 skeptical hat i'm saying well facebook did all right without a token right they've got a 500 billion dollar market cap and uh you know two two billion users right if i'm uber and i you know the ubers i think the one that gets used a lot is like we could have given uh tokens to the drivers by bootstrap and like help bootstrap the

growth there but if i'm an uber executive or an uber vc i'm saying well we did pretty damn well right we've got a public company 60 billion market cap and the biggest ride sharing company in the world right now um we did we did all that without a token so what is the problem that you're trying to solve there well that's survivorship bias right you're looking at the ones that succeeded how about all the executives that are sitting around wondering how come they didn't become the next uber or the next starbucks or the next you know uh facebook right i mean there's thousands or tens of thousands of examples of things that failed that probably had similar models that could have worked um and you know you can look around on a daily basis i mean how many how many things that you do in your daily life do

you actually have an equity ownership um like you know here's an example right i'm maybe a different demographic than some of your listeners and you guys but you know on a you know i take my kids to the park in the morning and then maybe we go get a haircut and maybe we go eat at a local you know restaurant and then maybe we go to a climbing gym or something like i don't own any i have no equity ownership in any of these small private businesses that we transact in a daily basis what if what if i did what if i had a token and you know all of a sudden i not only am using these even more but now i'm evangelizing trying to get all my friends and family to go use these uh services as well right most of the things you do on a daily basis you have no real incentive or interest

in the success of that business you're just using it but what if you had some sort of economic success or some sort of uh you know loyalty to these businesses and services you're using you could argue that a lot of these would succeed even faster um so you know i don't know i you know i i i wouldn't point to the super successful mega tech companies and say therefore we don't need to align incentives because these worked i would point to all the failures in small businesses that haven't maybe lived up to their potential possibly because they haven't aligned their their customers with their with their profiteers maybe this is when we can kind of get into the weeds a little bit more on crypto governance because you guys are pretty active um on some of these uh like from a governance standpoint a lot of the protocols that you invest in uh maybe like the way that

i kind of see what we're talking about here which is giving ownership in the in the protocol to new users is um is it's a it's a cac versus ltv problem right you know if you think of it like you are there's a cost right it's like it's almost like equity financing where you're giving equity away to uh to these new users of your platform and you're hoping that the growth that you get from those new users um more than offsets the cost of whatever equity that you're giving away i think one of the like the early iterations of that was yield farming right it was usually around these like decentralized finance like kind of farming type applications right where they wanted liquidity to move on and i think you know you're starting to see like this almost passed on compound right that they kind of kicked off defy summer with exactly what we're talking

about and they're they actually talked and almost passed stopping giving away those farming incentives because i think the problem with it is is that you know to your point it's it's a very expensive way to acquire customers and you don't actually maybe acquire the best ones right so from your perspectives or arca's perspective like how are how are protocols kind of what do you think the best way to actually give that those tokens or equity away to new users right is it just to kind of dump it on them is it to maybe have like lock-up periods like how are you seeing that maybe v1 of yield farming kind of evolve right in this next iteration of governance yeah i mean well i mean a lot of a lot of it is different incentives for different types of companies and businesses right i'm not sure there's a one-stop shop answer to how to do it but you're seeing that

experimentation right i mean the early days from compound and um you know even like ave and some of the other lending borrower clouds were like it's clear that they just inflated way too much right way too fast they just gave it away they got mercenaries to come in um and then you know those guys left and now they're left with a you know i suppose a worse off capital structure than maybe they would have otherwise but at the same time those protocols are still functioning pretty well right it worked right those guys are you know it's not like this is a high barrier to entry space and it's not like there isn't competition but if you look at tvl like compound and maker and uh you know ave are still you know leading by a mile in terms of the lending borrowing platform so you know you could argue that maybe they gave

away too much and maybe they didn't have the stickiest customers out of it or maybe they didn't get the best results but they certainly got good results um you know even notwithstanding the price of their tokens the business itself is you know doing exactly what you'd hoped it to do right i mean if you have uh i don't know the exact number of voters you know you're in that you're in the multiple uh tens of billions now and uh yeah i mean you got 14 billion a tv maker 11 billion ave you know curves got 10 billion you know that's those are real numbers compounds six billion those are real numbers for startups right i mean i think i read something a while ago that if you took all of the d5 applications and put them together collectively defy would be the 19th largest bank in the united states which is pretty powerful considering d5 is

basically two years old in all of a sense you know intents and purposes so you it has definitely worked it may just not be perfect so what's you know other iterations that people have tried well they tried the the curve or the ve you know uh tokenomics right where if you just lock up your tokens for longer then you get more benefits and that's okay right i mean that's that's a way of saying okay you have to at least be a long-term uh holder to get the benefits but it doesn't really incentivize the actions that you want i think the right design is to take each business just like we talked about with facebook and say what is it that we want you to do what is a perfect customer look like and let us let's incentivize you for doing that i mean looks rare is probably the best example right now right looks rare is

just a copy cat of openc openc is a corporation that is owned by venture equity that has all kinds of regulatory pressure that's preventing them from doing a token or doing anything to reward their customers right you know there's a 13 billion equity valuation of which what six guys benefited from that um you know there's no none of the customers or people on openc are benefiting at all from open seat success so here comes looks rare and what do they do they say hey what are the actions we want people to do we want you to list nfts okay cool we'll pay for it hey we want you to buy nfts okay we'll pay you for it oh we want you to trade okay we'll pay you for it right you know those incentives are already starting to wear off and looks for areas continuing to rise in terms of market dominance of

nfts right these actions matter now there's not a perfect formula yet i think these have to be tweaked constantly and i think sometimes you start something you realize it doesn't work and that's where governance comes in and you say hey this isn't working let's make a change or let's try this and i think the ability to be fluid and flexible really matters um but i don't think there's going to be just an answer to what is the perfect dynamic i think holistically the the things that i really believe in is that one you have to align all your stakeholders your founders your developers your passive investors your customers your liquidity providers you have to align them and two is you have to figure out what it is you're actually trying to achieve in your business and let's figure out a way to get people to do that how are you seeing governance evolve in general i

again i keep asking these like one-size-fits-all questions but like if you had to take a snapshot of like how governance worked at some of these large protocols like like a suit like ones that i know you've been involved like a sushi or something like that like let's say 12 months ago versus what it looks like today how do you see that structure kind of evolving i mean you first have to kind of start with you know most dows are not you know decentralized autonomous organizations right right very few are decentralized almost none of them are autonomous um they're really just organ they're really just organizations right so let's let's just start there and you know call space space right most of them are just organizations that have uh you know a fun way of describing themselves but to get to decentralized or autonomous you know there is a path to getting there right but

very few things can start fully decentralized and autonomous right you know bitcoin and even to some extent ethereum are probably the anomalies not the norm right most projects need to start with a real leader they need to start with some direction and then as you start to figure out exactly what you're solving for and your product market fit and what works and what doesn't and what kind of employees you need and what kind of customers you're attracting then you can start to figure out okay how do we automate some of this how do we decentralize some of the ownership right and if you go back to what uh hester purse and the sec put out i think two years ago with her safe harbor she pretty much nailed it right she put out a three-year safe harbor idea which said go ahead and start your company however you want we'll give you three years but

you need to you know hit these check boxes along the way that proves that you're heading towards decentralized and autonomous in order to basically be you know safe from you know retribution that's probably where you have to head so in terms of governance today a lot of what has worked from a government standpoint is less uh opinions not more right in the early days of a company you kind of need a king or a leader or a monarchy you know you can't just have a thousand voices and be like yep we're going to get it right on on day 30 because 400 people all have different opinions and we're going to figure out how to put that together it's like you know what sometimes you just need one person to make a decision and it might work and it might not but at least you can actually make a decision and if it doesn't work

then you can fix it so i've always thought the right way for governance is governance is a checks and balances system it's not designed to run the company you know just because you're a big token holder and have a large vote doesn't mean you are now the ceo it just means that you're the checks and balances system you have the keys to over turn bad decisions you have the keys to you know help off board or on board if you need help you have the ability to basically prevent bad actors you know all this talk about from the sec or really not the sec it's really just gensler but all this talk from gensler is you know about you know we need a cop on the beat we need someone to protect you the reality is like most of the time crowds are better at

protecting than you know individual enforcement and if you have the crowd saying hey you guys go ahead you two or three or five or ten people go ahead run your business however you want but we're gonna be watching you and if you make a mistake we're gonna call you out on it and you know we want you to do it in the public domain we want public dashboards we want public transparency we are going to be your public board of directors but we're not having a board of director meeting every day we're going to have it when there's a reason to have it right when somebody does something wrong or when a big decision needs to be made and and that's probably how it works best that's how we've seen it works best is get the right people in place run it like a business but when big decisions

need to be made or when changes need to be made that's when the governance really comes into play all right everyone quick break from the show to share a big update from our friends at paraswap the best platform to stake swap trade farm and more periswap just launched gas refunds based on how much you stake you can now get up to 100 of your gas refunded on all of your swaps on pair swap this is huge for anyone who has spent a lot of time in d fire maybe it's just starting out you know how egregiously expensive the gas transactions can get the gas fees are ridiculous at some points in time and now you can get those entirely refunded on pair swap to participate all you need to do is take a

minimum of 500 psp big shout out to the pair swap dow for making these refunds possible really it's just it's tough to be pair swap right now they give you the best prices uh they save you money you've got this gas refund if you stake psp they've got a smooth and really user friendly interface fast swapping it's really everything that you'd want from a d5 platform if you don't use them already check out paraswap today at paraswap.io now let's get back to the show jeff if you look at two two let's let's let's compare two companies so you've got coinbase and uniswap right um they both enable users to swap and trade tokens uniswap has three percent of the employees of coinbase yet they do about

75 of the trading volume and the reason that this has happened i think you would argue is because the incentives are completely aligned they make their users owners v via governance tokens and lp tokens is there any way for these almost i think in crypto we call them c5 companies right the the block fish and the coin bases of the world is there any way for them to compete with and is there any way for open c to compete with a looks rare or a coin base to compete with the unit swap like what is your vision of how these two types of companies define c5 coexist in the next couple of years or maybe you would argue d5 just kind of runs over these c5 companies yeah i mean i think short term the answer is move out of the us right i mean ftx and binance both have a token right you know

the reason i love the exchange business as an analogy is because you have three exactly the same companies all doing it completely differently right you have something like coinbase which just has debt and equity and no token you have something like unit swap and sushi swap that has no equity and just a token then you have like binance and ftx that have both or bitfenix right and they're all doing the exact same thing and they're having different levels of success based on partly their capital structure you know you could certainly argue that binance and fdx are having the most success because of the fact that they have the equity base to help them grow when they need it but they also have the token base who has this loyalty and membership benefit part in addition to financial upset that matters right that is probably the best alignment we've

seen so i think the short-term answer is you have to get out of the united states the united states is not allowing you to do it right or at least you know nobody's been willing to fight them enough to challenge it right you know you would love to see an open sea say you know what i hear you but i'm going to go issue a token anyway and you can fight me in court to see if it's legal or not but they're not there yet they'd love to see coinbase do it like i think it's crazy that coinbase even you know did a public stock listing instead of doing a tokenized stock offering like you know you're the behemoth in the business like go out there and try something that's hard even if it doesn't have the best financial results and go see if you can

make changes that are beneficial to you long term it's not like issuing equity did much for them the stock's down 60 since they went public so you know they you have to start you need the bigger companies that are well resourced and have the legal teams to go out there and and push the envelope so i think that's step one is is the us is challenging but somebody needs to just push the envelope and try to win a court battle two though is i think [Music] you know ultimately i do think that defy and c5 kind of merge where i think eventually cfi you know these centralized companies really just become pass-through entities to a d5 back end the analogy and i'm always big on analogies because i uh you know i speak

to a lot of investors who are new to digital assets i try to find ways to dump it down and i i test things on my 73 year old parents to see if they understand it but i know others will but the analogy i always use is like you know 20 years ago 25 years ago you know if you flew at an airport you basically had your paper ticket they issued you the paper ticket in the mail you showed up you know you handed your paper ticket over here on the plane it's somewhere around 15 18 20 years ago they started doing the electronic ticketing and the kiosks and you had to swipe your credit card to get your your your ticket as silly as this sounds now people were terrified of doing that you know they're about to go up in a plane you know 30 000 miles 30 000 feet in the air going

500 miles an hour and they're totally fine with that but they were terrified about swiping their credit card in a machine um so what they would do is they'd go up to the ticket counter and be like hey you know i need to go you know get my ticket and the person behind the ticket counter would say okay and they would walk you over to the kiosk and show you how to use it that's basically what i think the c5d5 relationship will be it's like you'll go to coinbase because it's comfortable you'll go to openc because it's comfortable right that's your ticket agent that's your you know live person on the phone who can help you um but all they're gonna do is route your trade through a d5 back-end right you're going to have the amms providing liquidity um you know and you know they're going to they're going to route

trades and source the liquidity just like anybody who uses d5 directly so ultimately it doesn't mean that they don't have a place it just means that you know you're not going to coinbase because they have the best market makers you're going to coinbase because they have a brand in the service um and ultimately you're all basically going to be transacting out of the same liquidity pool so jeff maybe let's let's send the the focus here towards like the future like you guys see a whole bunch of different opportunities as a fund right you know i know you've been active in uh you know like a whole bunch of different governance proposals that kind of thing what are you excited about let's say over the course the next like six to twelve months any areas where you're like just super keyed into excited about you know

um from like a theme or sector standpoint like a theme or sector standpoint yeah yeah i mean you know we we i i definitely say it's a little bit of a lulled right now in the sense that like you know a year ago two years ago we were incredibly excited about nfts and gaming we were incredibly excited about d5 um uh right now it's a little boring in a sense like honestly the biggest thing i'm most excited about is stable clones i mean i think stable coins going from zero to 200 billion in the last year and a half probably heading to a trillion plus in the next year i think that's a huge deal um there's a lot of you know pure play ways to play that right from luna to frax you know for those who have access maybe circle equity but they're you know i think that is a huge growth engine

for all digital assets i think bridges is still something that is really important you know whether you are um you know there's obviously a lot i don't want to get into the technology here but in terms of different types of bridges that exist we'll see which technology wins out but this idea of a cross-chain world where you don't even really care um what chain you start on or end up on all you care about is can my assets get there i think that's a huge um problem that will be solved too in the next year you know some some form of interoperability um you know whether that's atoms ibc ecosystem which we're really bullish on or you know something like a multi-chain or synapse but there's a lot of different ways to tackle that problem um and then you know i'm also really um a big believer in kind of non-trading

consumer apps that start to work right i mean we've seen little iterations of that you know things like step in right for those who aren't familiar you know the idea of getting paid for for you know basically moving and exercising um to some you know even like b2b things like like a unibrite that's that's working on logistics um you know to certain gaming apps or or you know integrations with shopping um you know i think for example even though the metaverse is a really loose term um and probably years away from having any real traction like you could think of amazon really as a giant metaverse right right now you go to amazon and you click around and you shop in different stores well you know one day that might be a metaverse experience right where you have your avatar and you're you know going into these different storefronts

within amazon um so i think you know this idea of of of you know kind of real world consumer behavior things rather than just you know things that are based on trading and and finance um are really exciting and then you know lastly i'll just this is one we've liked for a while but you know really big on this interaction between fans and their favorite sports teams celebrities um you know athletes etc you know we've talked about chiles many times with their idea of fan tokens right connecting fans directly to their their favorite sports teams but i think it goes beyond that i think i think you're gonna have these personal connections between musicians athletes influencers you know celebrities where they directly own their communities

and the communities can benefit both financially as well via utility for being a part of that community so i think that's sort of the biggest growth engines and i'll leave with one last that's probably further out but um what's really excites me mostly is i think every company and entity in the world is going to have a token one day right we already talked about twitter token like it is so inevitable to me that disney will have a token one day and the disney token market cap will be greater than the disney equity right because that token will give you rights to disney plus and you know access to rides at the park and you know dibs on ip and things like that you know i think every municipality will have a token right you know you want to fund a certain project in the city you live in

great you know you can do that through a token and get better access to the park or maybe faster lines at the airport or different rates and taxis or maybe you live in you know san antonio but you're bullish on you know uh george atlanta georgia you know you can invest in that token if you want even if you don't live there rather than you know instead of the old way of having to go there and buy a house to have any exposure to it now you can you know do it through a token i think every university is going to have a token you know you're going to buy ucla token for your kid when he's born and if he goes to ucla 18 years later you can use it as tuition and if not you can trade it for you know a notre dame coin or you know a harvard coin um you know i just think

it's so obvious that every entity in the world is going to have a token um that you know that is going to be so much bigger than what exists today jeff one thing that stands out that you didn't mention you mentioned gaming in the metaverse and and the everything having a token one thing that is clear that you didn't mention is is defy and to me when i think about your investing style you are one of the unique folks where you didn't come from like an engineering or software background started investing you came from this finance background because of that i feel like one of the ways you look at the market is uh you say okay some of these things actually have almost traditional spit off cash flows and they've got margins and and you can analyze these things in in almost more traditional capital

markets ways for defy tvl has really stagnated since like november or december of 2021. what what's your take on d5 over the next six to 12 months still stagnant got over at skis in 20 in d5 summer and and it's going to continue just kind of stagnating or do you think we're primed for a kind of a breakout and defy again well i think it depends on if you're talking about the token prices or just the usage and the and the um you know activity level so i think you know i didn't mention d5 just because you know this is as silly as it sounds you know defense kind of old news compared to what's coming in the future right you talking about utility it's becoming becoming a utility of the industry yeah yeah i mean devi is a mature two years old now right we don't it's not exciting

anymore um no but i mean you know i'll go back quickly to you know i mentioned uh at the top of the hour we talked about you know my experience with citibank freezing my assets and me having a hold of plug in coinbase do you know how i actually plugged that hole i took some ethereum i deposited on ave i took out a usdc loan and i took that usdc and i sent it over to coinbase to plug the hole until i had access to my bank again you know and i ensured my risk at ave with nexus mutual um you know to me that took 15 minutes that was an obvious solution to a problem i'm guessing most people in the world don't think of that as an obvious solution to a problem yet but it was right my bank literally froze my assets for 14 days didn't tell me i

had no customer service no idea what was going on uh and in 15 minutes i solved the problem through d5 i think you know d5 just works right it may be kind of boring right now because tvl has stagnated um it may be kind of you know frustrating because token prices have been down for 12 months but it works right it really works and i think more people instead of just writing about it and talking about how nothing works and you know like joe weisenthal bloomberg for example right i was picking on him the other day because he was just like you know he wrote an article yesterday or two days ago saying like you know all crypto is is is is trading for speculation the reality is they haven't solved for anything i'm like that's clearly somebody who hasn't tried to do anything right people who have played

you know gaming blockchain-based games know that it works people who have used d5 applications know that it works people who have sent money across boundaries with you know stable coins know that it works um it's just that not enough people have actually tried it yet right it's still intimidating it's still scary right you know again i joked but 20 years ago people thought it was scary to put your credit card in the machine they really did they were like i'm not doing this and then one day there was that malcolm gladwell tipping point was like well you kind of can't function in society unless you put your credit card in things and one day it was just like okay i don't agree with it it's scary but i'm gonna do it anyway um that's sort of where we'll head with defy it's just like one day you know you're going to have more

and more of these anecdotal stories like mine where you use defy to get a loan or to you know send assets and be like yeah it just flat out works and it works a lot better than the system that we have in the banking and brokered world so i don't know when that tipping point happens i don't know when you know it just becomes normal for people to do that but i think it's i think we will get there um but in terms of investing yeah i mean d5 is one of the easiest things to invest in because those cash flows and revenues are real i mean we can model we can you know we we only invest at arca in companies and projects that we can see a real path to token accrual right we're not you know we're not making these these early stage bats of oh this is the future network of

the world and we'll figure out the token later we invest in things that say yeah we can see a path right now or in the near future to how that token is going to accrue economic value and that's usually through a combination of revenue and cash flows and some form of utility feature you know binance is a good example right finance from a cash flow standpoint is easy they make money when you trade on their platform and you know some portion of that money gets used to buy back b b tokens but they also have all these different utility ways to use the bmp token you can use it to get discounted trading fees you can use it to get collat as collateral to trade you know futures and options you can use it to you know get in the lottery for new tokens that get issued on binance

they've solved for that hybrid you know function of here's the cash flow financial upside on one side and here's the supply here's the demand you know function for the utility or member benefit on the other side you know defy a lot of them do the same thing so you know we certainly look for those tokens that accrue that real value through cash flows but also have found ways to make the token useful within within the network um it doesn't necessarily mean just because things are valuable doesn't mean they go up though right and i think that's where the misnomer is in in crypto investing is everyone thinks that if you find something that's cheap it has to go up 100 tomorrow or you're wrong right sometimes it takes some time sometimes you have to own it and be like yeah you know what i bought it and it was really cheap at two times sales and

four times earnings with a 15 dividend yield and guess what six months from now it was just got cheaper now i was trading at one time sales and two times earnings and a 20 dividend yield doesn't mean you were wrong per se it means it got cheaper you should be you know your risk model should be telling you to buy more so that's how we think of it there is is you know we we certainly have uh heavy allocations to defy and we've been adding on the way down and you know but it's about finding the right businesses finding the right projects finding the right tokens that accrue that value one thing that um i don't think we've solved in crypto yet uh that actually some of the banks really have done a good job at is keeping your user um and just making it really even though the product sometimes

sucks you end up sticking with your your fintech app or your bank for 20 years right i bet so you mentioned you use coinbase i bet you use coinbase because coinbase was probably the first place that you ever bought your first bitcoin i don't know what it was but i know that's the same for me and you know i've been using the same bank account for 20 years even though i hate the experience uh in d5 we haven't solved that right it's really easy for a user to just flip out of one protocol into another and we've tried to solve it first with yield farming then yield farming we realized people dumped the token so then we introduced these like ve mechanics to try to like lock up users and to keep them for longer what what is the future of like building moats and capturing

value and just like keeping a sticky user look like in d5 yeah i mean that's a great question uh uh you know i don't have a marketing or or you know branding background in any way shape or form but i think you've hit it on the head right is that a lot of times you know especially in this space people care so much about the technology and most of the time it has nothing to do with the technology it has to do with the business development and the ability to you know create that sticky customer experience i don't know if i have great answers for what you have to do but i can give you examples of um you know i mentioned nexus mutual i'll pick on them for a second i really like the nexus mutual team you know there's only seven or eight people

working there compared to you know 500 at like a you know an insured tech company like root or lemonade it clearly economically it works you know you can go out there and you can buy your insurance you can protect your principal and it makes all the sense in the world um but you know from an insurance standpoint in terms of an easy product you know most people aren't going out there seeking insurance right the insurance just comes with what you purchase right if i buy a car i'm basically being forced to buy the insurance if i go rent a car i'm being forced to buy the insurance i'm not like renting the car and then 45 minutes later trying to drive to an insurance agency to get insurance on the rental car i just i just got right that's crazy that would be a terrible

experience you know nexus mutual is caught in that right now as well it's like i go on ave or i go on compound or i go you know somewhere where i you know put assets to work and i have to separately go find nexus mutual and say hey can i buy insurance on that right that's a that has nothing to do with whether or not the technology is great or not for something like nexus mutual has to do with like they have not solved that customer stickiness thing they have not solved the business development or the partnerships they need with d5 applications to get people to in one click buy the insurance right it should be the second i connect my metamask wallet to a g5 application there should be some sort of a pop-up that says do you want to insure this transaction right they haven't solved that that has

nothing to do with anything other than again marketing pr customer relations things like that so i think that is a real issue in the industry not necessarily specific to d5 is that most of these teams are just tech teams right they haven't invested in the business development in the marketing in the customer you know stickiness they're just building cool tech and putting up a you know a 1990s style user interface and hoping that people try i mean look at curve right i mean curve looks like an atari game um but that works that's awesome that's great i feel like that is great branding don't you think like yeah i mean very very well maybe but my point is like that's clearly not a focus of the you know there's no focus there

there's no like team at curve who's like you know what we're gonna focus right now is on customer retention and building and marketing and ui right like so i think that is probably is something that definitely needs to be solved for i don't have a lot of good answers to how you solve it but i think that is definitely where money will be spent uh in the future is is figuring out that loyalty and you know it's you're right i mean a lot of the companies and businesses that you use are not necessarily ones that you love but it's just easy because you've been there for so long but i would actually argue it's the other way it's it's more that you're a prisoner right it is just such a pain in the butt to change banking accounts it is such a pain to you know on board at some of these

financial institutions that you just basically are like i don't care how bad of experiences i'm willing to do it the ease of you know the the ease of d5 how easy it is to be fluid basically allows you to be free and while you could point to that and say well you know therefore d5 has a customer retention problem you can also say that defy as a whole has an awesome customer experience because you are free to move around until you find one that you really like and then once you find something that you like you're going to stay right so you know it's probably better for the consumer but definitely a a challenge for you know the companies and projects yeah no nobody moves into stable coins and then moves back to their us dollar in their bank account right it's just a better yeah better user experience one of the last questions i have i'm not

sure if mike has anything else is actually we've been talking about the app layer a lot but i'm curious to get your take on layer ones and really and really this base layer and i think my main question is when you look at valuing these layer ones do you look at them more as a as a business where you're looking at uh like cash flows basically or do you look at them more as a economy or like a country where you're valuing it on like the economy of a nation right how do you value and like mental model and like framework these kind of layer ones sure and it's a good a segue to maybe one a future guest for you would be a great analyst we have at arca by the name of nick hoats who wrote an article exactly that right our blockchain our blockchain february 22nd on our blog

you can find it at ar.ca but it says are blockchains businesses are nations and he actually walks through exactly what how we look at uh these different entities and the answer is we look at both um you know again valuation techniques are not meant to be you know you do we do one thing and that's the answer right it's usually you know multiple different frameworks right even in the equity world right you'll use a a dcf analysis you might use a comparable comps method you might use a dividend yield model you might use three or four different ways to come up with what is the valuation of this business you know we do the same thing right now with blockchains um when they first start a startup blockchain a layer one obviously you have to look at it more like a nation right it's equivalent of

if you found some you know remote island in the middle in the middle of the pacific it might have speculative value on day one right because it's you know it's it's land all these things you could do with it you could build roads and businesses and all these different things that generate economic activity um but it's you know it's a blank canvas right you have to do something with it before it has value but then 10 years later if you actually succeed with that and all of a sudden you have all these you know these things happening then you could point to oh look at all this tax revenue that we're creating and now you could actually value it like a business because you have real cash flows i think the answer is both right i think you you you know ethereum is a great example because ethereum's the most mature of all the layer one

blockchains in terms of of of kind of being on both sides of that aisle as a business really easy to to to analyze right now right it's high fees those cash flows are real with because of the ip1550 because of eip 1559 as well as you know heading towards the east 2.0 merge you can start to really see the economic benefit of those cash flows and how it accrues back to the eth token so you can very easily create an eth model and say what are these cash flows worth but at the same time those cash flows are in eth terms which basically means that it's a currency in its own native you know it's very circular right so then you have to look at it as a nation and say okay well you know within this nation and all this uh economic activity or gdp that is happening

how valuable is it to have your own native currency where everything is transacting so we look at it both ways and again it depends on which one you're looking at and how mature it is whether or not uh fees make sense or or you know the stickiness of that currency and the velocity of that currency within within the nation the biggest takeaway for us is that three years ago nobody knew how to do anything in in terms of in these things now we have two separate valuation methodologies that we're using and we might have four or five in the future um but they're both really helpful ways to look at the future economic growth of these blockchains and how that ultimately accrues back to the token i well i think it's uh it's it's tough it's certainly tough to do um i mean we didn't get in to talk about anything

like mev or anything like that like i mean i my you know what i think about how to value something like keith it's like the discounted sum of all the the future fees that accrue to the network but obviously they're like block rewards and then there's also like meb and value that gets extracted that way but that's maybe a topic for another time honestly there's the there's the ryan right ryan sean adams from bank list which is blockchains are just companies that sell blocks yeah i like that so yeah and you can i mean you could actually run a real income statement based on that you could say you know this is you know this is the block sales and this is the you know cost of blockchain space and yeah um you know you can you can actually run a real you know tradify analogy income statement there that looks very similar

but i think it's just cool that there's enough people in the space now that are starting to think this way that are starting to put that that work out there um and starting to test these models right you know don't forget all these everything that we now believe is is gospel in in you know the equity and debt world like that stuff didn't exist 100 years ago either right the uh um the fixed income securities bible that everyone reads was was created in like the 60s or 70s and and you know graham and dodd i think was in about the 20s or 30s uh before that you know stocks were around for 300 years before that that people traded without having any idea what the value was so you know it's the fact that this stuff in year 10 is starting to be developed in 30 years

every kid coming out of school is going to be forced to read the you know the digital asset valuation handbook and it'll be 1400 pages long and you know most of the people will skip reading it and think they'll figure it out on their own and they'll you know six years later they'll realize they need a better base and they'll read it so you know we're heading in that direction where these valuation techniques are being created and they're being tested and people are thinking of them through um and you know in 20 or 30 years digital asset investing will be you know a boring commodity just like equities where when if you give 10 analysts the exact same information they're all going to give you the exact same outputs um you know that's what equities in fixed income look like today that's obviously not what digital assets look like you

give 10 digital asset investors the exact same inputs they're going to give you wildly different outputs and then you know quite frankly that's where the alpha comes from yeah right now crypto moves on the memes and the narrative more than just i think probably the cash flows you might argue differently but that's that's kind of how i see it how long does it take for um for this like fundamental investing to move into crypto is it really 20 to 30 years or do you think it happens faster than that no i think it definitely happens faster in terms of the the types of investors i think it might be 20 or 30 years before you have an agreed upon framework um but it again we talked about at the top of the hour that the reason bitcoin is so correlated to the nozzle right now because macro investors are dominating trade

when pensions and endowments and they're coming very fast like when they start putting their money in and when you start getting long short you know equity managers coming in and you start having these different fundamental uh managers coming in then fundamentals will matter more than means you know right now memes matter because this is highly dominated by macro and retail um you know as the investor base changes the the inputs to success and failure change as well yeah jeff anything else you want to talk about here uh no shout out to the great work you guys are doing i appreciate all the education you guys are doing and shout out to my team at arca who's who's i think is the best in the business in terms of thinking through some of these uh these challenging concepts so i appreciate you having me on and getting a chance to

talk about it yeah of course jeff um places to find you is uh at on twitter at jdorman81 arca is at arca and then i would recommend everyone subscribes to their newsletter uh the two satoshi's really good they're cheesy yeah so jeff thanks again for coming on uh this has been awesome and uh yeah be well all right appreciate you guys been a lot of fun yeah cheers [Music] you