Memes are Dead, Long Live the Memes | Nick Tomaino

Transcript

The Narrative was this is open for anyone anyone can you know make money [ __ ] the VCS you know whatever but it turns out that was all a lie there maybe weren't VCS taking advantage of people but there were these middlemen that were taking advantage of people right and so I'm just very skeptical whenever I see the herd going uh in One Direction thinking about like human dynamics um more and less about like Tech is I would say underrated if you're like if you're investing or trying to make money in crypto all right everyone welcome back to Empire we've got uh Nick tomino joining the show again Nick was uh I think on the show last year um he started one confirmation Nick I also

remember you were running one of the good events token confirmation I token Summit yeah token Summit I remember back in the day yeah that was early 2017 yeah good event I remember but yeah anyway started one confirmation one of the best uh funds in the industry and um is perpetually impresses me by how often he is able to stay grounded and take the other side of things and not get swept up in the me in the Mania of things and um I think it's been on the other side I think we'll talk a lot about like just being on the other side of uh being very not getting caught up in a lot of the meme stuff that's been happening recently so anyways Nick welcome to the show thanks for having me man good to see you why don't we just start there so um we're recording this February 19th on

Wednesday and and over the past weekend you just saw all this like Malay um and Libra and mcoin stuff and it really feels like to me this is the Tipping Point for the industry realizing that okay maybe some of these me like this meme stuff maybe is not as healthy as we originally thought it was um I'd love to just get your 10,000 foot view on what's happening with like memes and salana and just the whole debacle that is uh unfolding before our eyes yeah well I mean I I would say the um the open e of like crypto is um both a gift and a curse and it's like it's a gift it's the reason that crypto is what it is today is because like Bitcoin was open source

and anyone could understand it anyone could copy it and spread it anyone could participate like the open ethos is great but the open ethos also I would say enables um you know grifters scammers schillers whatever however you want to describe that and we've seen time and time again how that can go wrong um in in in ways that really hurt retail um and that's really what I care about like when I when I started in crypto um I was like 25 years old I didn't have any money to my name and I just wanted to make a quick buck and so I understand that's that's like

the journey that most people in crypto have and I I don't like look down on that at all so but when I call out some of the like the meme coin [ __ ] it's more from the perspective of like someone that that's speaking to like my 25-year old self like you want to be long-term greedy rather than short-term greedy and so when you see these kind of Manas you you you can kind of feel that it's it's it's too much short-term greed and um and I think that's kind of what I would describe the you know the the pump that fun [ __ ] that we've seen on salana right which was kind of um the the narrative was this is um like you know open for anyone anyone can you know make money

[ __ ] the VCS you know whatever but it turns out that was all a lie right like these things were um you know there maybe weren't VCS taking advantage of people but there were these middlemen that were taking advantage of people right and so I'm just very skeptical whenever I see the herd going uh in One Direction and um I think I I think that thinking about like human dynamics um more and less about like Tech is I would say underrated if you're like if you're investing or trying to make money in crypto um all right so let me try to break this whole meme coin and salana thing down into I think there's three buckets that people are kind of

conflating and kind of combining these three buckets together so there's this question of like is it ethically okay to do what's happening with uh you know is is this all ethically okay then there's is this sustainable right like is this going to come crashing down and this is some big bubble and then there's the like what's the impact on salana and is you know there's a lot of talk like is salana gonna overtake ethereum it's like what is the impact on salana of this so maybe viewed through those lenses like ethically sustainably and then the impact on salana I'd love to hear you break break down your thoughts um ethically I mean are meme coins okay of course like

Bitcoin is the OG meme coin um and like meme coins are not going away at all like I'm bullish on Meme coins long term um is the the way that we're learning that these pumped up fund meme coins kind of got um basically played retail to to and Griff retail on like to me no that's like not honorable um and I think there is this I think there is a lack of Honor in crypto right now that is um troubling I would say um like there's a lot of chasing and I get the chasing again it's like people want more money

they want more attention um but in the in the short term but I think like my interest is like retail and if we want crypto to win like this stuff maybe it's short-term um good for some people who are chasing it but it like it hurts way more people than it helps and that's bad for uh the space I think and so I mean ethically like the the pump fun [ __ ] um again I don't really care about ethic I'm not making like an ethical or moral argument really I'm more saying like this stuff bad for crypto and I think crypto is good for the world I

want to bring crypto to more people so that's what I care about how do you um grapple with this idea that you're long-term bullish meme coins but shortterm you think it's really bad for the industry no specifically the pump fun um this like Insider game that we're now learning about right where there's um there's sniping there's lining up influencers to pump it there's paying influencers and then just when you get to a certain level everyone dumps right like that um that type of just soulless greed I would call it is um but how do how do you prevent yeah how how do you prevent against that if you do how do

you basically maintain an open permissionless system and keep uh but while preventing against this you know I'm not saying prevent against like I don't think um I'm saying educate people um make people help people level up right like I think um and I I I used to bet on sports right I think betting on sports is really dumb you're gonna you're mostly going to lose but it is like it is skin in the game you are uh risking something and either winning or losing based on objective truth right um so the the next level I would say is something like meme coins and you know

where um maybe it's a little better more positive some than sports betting you have more control of it because you actually you're part of the community own the coin can you know do something to make it more valuable but the like the pump fun you know fake um Fair launch stuff is mostly bad right um and is most but but people can still learn from that so the hope is like even though this uh a lot of people lost from it like there's some that might really win longterm if they can you know get smarter and level up and then believe in something more than just chasing a quick Buck right that's that is the next level so it's

like sports betting is maybe level one memec coin chasing is level two then believing in something more taking a long-term View and getting like real skin in the game and something you believe that was my journey by the way like um and that is I think a Journey that can lead to um a lot of uh good stuff so that that's what I try to evangelize yeah I I'm generally of the belief that this stuff actually ends up self-correcting fairly quickly like you know who Who's Who in the right mind is going to start buying like new mcoin launches right now these things are like straight down so I'm generally of the belief that these things self correct what do you think of um maybe that third pain of glass that I was kind of looking

through to to talk about this is like ethically sustainably and then the last is maybe like the impact on salana and um you talk about like leaders and vitalic and stuff I'm curious how you think that salana and the leadership of salana could have handled this better or differently or maybe they're handling it just how how they should handle it um look I I'm not a member of salana uh like the salana community I would say um it's always felt to me like this kind of Silicon Valley uh company coin and this like the culture that really um kind of

respects um existing institutions and kind of chases Silicon Valley Prestige and um so I I don't I I mean I think look there could be I'm not going to write off salana like there could be some interesting projects that come from salana but like FTX and now this right um were both those were the right now the legacies of salana um so let's see um you know there's there's G there's new narratives that you know salic Community will shill like dpin or or whatever else and um I don't know I from an investment perspective like I invest in products that um I get excited about from a user perspective and there's not

one product that has come out of salana yet that has been kind of a new product that I've been excited about from a user perspective so um so I I hope that salana levels up and um and we see some real interesting products that are that are net uh new for the space but I that that hasn't happened yet and what and I think you know what may be more likely is there will be the salana community as a culture chases shiny objects that's like what salana people do um and there'll probably be another shiny object that they jump too um that maybe you know aptose or sooi or whatever you

know whatever shiny L1 comes next today's episode is brought to you by uni chain the layer 2 designed to be the home for Defi and cross chain liquidity with up to 95% lower fees than ethereum and launching with 1 second block times uni chain is the L2 purposely built for defi powered by Unis swap uni chain enhances defi experience es with faster cheaper and seamless transactions even across chains uni chain mainnet is live and available for everyone to use so click the link in the show notes to find out more thanks to unich chain for making today's episode possible so you do you you don't believe

in anything outside of ethereum from a like built where people should build things not at all no no I never why would you why would you say that um I thought you were implying that other ones like salana sui Aptos are just shiny look Co Cosmos um the cosmos ecos I'm a big believer in app chains long term okay like I think every quality uh application developer will um want the control and the economics of having their own chain and so um the the the two best ecosystems for that right now I would say are Cosmos and ethereum Cosmos um that was the the vision of Cosmos is

kind of U is an app chain um Vision kind of sovereign chain uh every you know every developer would want self- sovereignty and um so I we know we've invested in in many projects in that ecosystem and um I would say that that's probably quite contrarian right now um but I'm very bullish on like the cosmos ecosystem and kind of app chains in general um and then ethereum is also uh kind of well suited for app chains with kind of l2s and l3s so I think the reality is like mid developers are going to go to a chain like salana and where where there's users right now and there's interest um for the short term but like long term uh as a developer why

would you want to bring uh that's really as a developer that's really bringing like something net new to the space and not like zero sum why would you want to um contribute value to an existing chain that way um such that like you know when the when the Trump coin uh happened there were no like there were only a few apps on the chain that worked during that time and it's like there there's scalability problems and there's more importantly like control and economic problems if you're an application developer that's on an existing chain and so I think app chains are just 100% the future got it do you is there anything that would get you to change

mind about Solana or do you think it's a cultural problem that will that just won't change what would change my mind is if there there were interesting products that are net new and and to the space and and bringing new people in yeah and you could say you know something like PP pumped off fun like I'm not um that brought new people in um I don't think it was kind of net new and uh really positive sum um so that like I would be very excited if you know we saw some applications that were really something like poly Market um you know in in 2024 or you know openc in 2021 2022 or you know the maker Dow Unis

Swap dydx and kind of their early defi days like these are applications or even like you know forecast or warcast um you know this year like these these are um you know applications that I think are kind of net new for the space and bringing new people in and um I don't think we've seen that from salani yet but again I'm not I'm not writing it off I just I think there's been it's skewed far too much towards just hype do you know Alliance style likeon and Chow yeah so I just left this Alliance event and one of the founders there he said look I'm I've got everything nailed down I've got my product I'm just debating should I build it in salana or build it on base he's like I've figured that out and actually

the the thing that came into my head there was one of your tweets um and I'll read it it says VC is telling Founders what chain to build on is Peak loser energy the startup will only really work if there's founder belief the role of an early stage VC is to instill belief not project bag bias how do you think about that from yeah can you just tell me more about that how you think about it I I think Founders should build on whatever chain they they they Vibe with like they the they believe in and they understand you know the culture I don't um and I think most will ultimate like the good ones will ultimately again like probably build you know launch their own app chain so yeah

um I don't as I said like I don't I don't I'm I'm always kind of I care more about the application right like at this point um 2025 the past 15 years in crypto have been about two things um infrastructure and and just money right like all the founders and the investors that have done really well they've been either doing the infrastructure stuff or the money stuff right right um and I think we're at a point where it's time for applications we need kind of consumer applications um that's like what we're focused on for the next 10 years is consumer applications kind of at the intersection of culture and

crypto and I don't I think the the question of like what change should I build on is too inward it's like not the right question yeah thinking about like crypto and so much of crypto even like and this you know some something that's frustrating to me is like there's a there's a whole bunch of venture capital money that is just investing in like the next L1 or the like very inward [ __ ] that is not really net new and pushing this space forward but maybe it's like getting liquidity from one chain to this new chain or something like that right so I I think um you know the best Founders just want to build like useful

applications for for people and make crypto more useful for people and um you know it it doesn't really matter like again even though I I'm not that interested in salana like if if if a great founder wanted to build something on salana that would be cool with me and I I would love to invest in it if it was a product that resonated with me how do you grapple with this idea of like so okay so I I love the mindset it's like we need the applications I think everyone listening to this is probably like listen being like yeah Nick like kind of nodding their head like I I agree with that however this is like I mean what what are we looking at right now like I think monad launched their test net today was like movement launched bar chain launched Mega eth launched abstract launch these things

they're all launching it like ridiculous like billions of dollars valuations do you think that Market eventually just self-corrects or like you as a venture capitalist like you have to provide returns to your LPS so that is where the returns have been in the industry or or maybe I'm wrong about that um look I mean I I think um we our returns have been from applications like openc and like bridge and like um you know a a bun uh super rare and dydx and a bunch of others market so poly Market no returns yet but uh no no DPI but on paper yeah um so I think we have among if not the top

performance in the industry not doing the um for the most part and again I'm not also not like religious against big uh you know like token rounds if it's something that's net positive for the space but a lot of these I would say are not they're more a product of there's too much venture capital in the in the space and a lot of the LPS of these big funds that have raised billion dollar funds part of the the appeal of crypto to these LPS is the quick liquidity that's something that you don't get in uh traditional Venture right so they're kind of investing in these big funds because they want these Tok this token liquidity in like a

couple years and um I it's not I don't think that's generating massive returns right like it's um and most importantly it's bad for retail because if you look at in the the history like the past call it five years of this um retail investors buying into this L you know the next L1 um at a multi-billion dollar valuation have on average lost right so it's honestly a similar game to the memec coin [ __ ] on pump. fun just for like Prestige VC rather than um you know like the average guy so um I and I don't think like uh I mean we look we're we're in a

blessed position because like for me I already had um you know like a lot of success even before I started one confirmation like I I um you know am a big believer in Bitcoin I've never sold any Bitcoin like I've been blessed because I haven't I've been early and I haven't had to chase anything at all I haven't had to chase big funds I haven't had to chase narratives and so I've been been able to be very long-term and more principal and I think my LPS are very happy about that um it's also like a position of privilege I get that there's a lot of other people out there that you know maybe don't have that so it's it's just

um it's a an approach that's done well for us and I think it's approach that can do more uh well for a lot of others as well um and I but most importantly like again for your listeners like I think there's a lot of retail people that you know want to make money from crypto and I think these big VC chains are net uh losers and um I I don't think jumping in uh is a winning proposition on average today's episode is brought to you by uni chain the layer two designed to be the home for Defi and cross-chain liquidity with up to 95% lower fees than ethereum and launching with 1 second block times uni chain is the L2

purposely built for defi powered by Unis swap uni chain enhances defi experiences with faster cheaper and seamless transactions even across chains uni chain mainnet is live and available for everyone to use so click the link in the show notes to find out more thanks to unich chain for making today's episode possible let's actually go there because if I'm let's say 25-year-old Nick was starting again in the industry and didn't have money um it feels harder than ever I think to make money in the industry right now if you're a retail you're you're you're retail maybe you don't work in the industry full-time or something but you really want to get in or maybe you just started working in the

industry you don't have much money you're like it's I mean what basically the return dispersion is larger than ever right it's been like Bitcoin so if you didn't own Bitcoin salana hyper liquid or some of the memes you didn't really make money the cycle so what is your advice to just someone listening being like yeah Nick actually everything makes sense to me but like how do I make money in crypto right now I hate the term cycle like this this cycle like I think the the first thing is um you're not a four year you're not a four-year cycle believer um no this cycle is like something I see a lot of people like people say um and it's more of a trading mentality right which I think um I think the first

thing you should do is um take a long-term view on crypto like do you believe that the internet is going to be more important or less important in 10 years if you believe more the other question you should ask is do you think that people are going to trust government more or less in 10 years I think most 25y olds would say more and less to those questions right and so if you believe that uh buy some Bitcoin buy some eth and maybe you know maybe buy a little bit of a few others if you want to take a little more risk right um I think get your exposure that way don't have don't come in with a trading mentality um and and then start using

products right like I think just being a user of products is vastly underrated and um so believe in something get some uh you know skin the game in in like a long-term basket and then start using products and being curious and like I think if you a problem that a lot of people including you know myself at 25 um had is like you just listen to narratives you a narrative sounds good and so then you you chase the narrative and there's so many narratives in crypto um that that sound good um but how do you how can you basically separate a [ __ ] narrative that just sounds good

from something real I think that's like a question that's important to ask and and to me the answer is is there a product that you believe in if you're an actual user of the product and that the the product um is useful to you then I think that's something to get more exposure and maybe double down on maybe go all in on but like you got to get out of a mindset of just chasing narratives and have you know a long-term mindset use products and be curious those are the the three things yeah all right let's pivot to um actually two we can call them narratives or products or use cases or whatever that we that I wanted to talk about one

is um kind of this intersection of actually memes nfts creativity media it's something I think a lot just as someone who runs a media company but actually before we do that there's another one I saw you tweet polym Market was the first stablecoin Native consumer app to break out my bet is we'll see many more soon so why don't we talk about just like consumer apps and stable coins and this kind of uh yeah maybe take us into that conversation yeah I mean I think stable coins are um are one of the biggest things happening this year um again for for new people you know understand what's going on in stable coins there's probably going to be a lot of interesting new

opportunities in stable coins I think at a high level um you know my stable coins have always been an interesting area um starting with you know maker Dow that was one of our first Investments as a fund and you know maker Dow and die is kind of this um decentralized collateralized onchain stable coin um and the what's happening now in 2025 with stable coins is quite interesting because the Trump Administration has made it a priority um to get clear legislation with stable coins and I actually think the um maybe not just the trb administration maybe even the ruling class broadly because before FTX collapsed they were actually behind the

scenes working on a stable coin and they were also working closely on stable coin legislation so it's possible that both sides see stable coins is really important to the future of of the the US economy um the the macro backdrop and I I encourage people I'm sure a lot of your listeners know baji um who's a close friend has written a lot of good stuff about this um and I talk to him all all the time about this stuff he's kind of probably my smartest friend um on kind of global macro stuff and um the the backdrop for for the us right now is um China and Japan are the two largest holders of us treasuries um selling us treasuries is how the the government um

pays off its debt and funds operations right and both China and Japan are get are dumping treasuries and and and not buying treasuries anymore and um there's a bunch of uh brics countries as well um that are getting away from the dollar and so you know you have a countries around the world the governments are getting away from the dollar getting away from us treasuries stable coins are a way for the US government to distribute the dollar uh to net new users around the world without the government of those countries even being involved and that's really what's happening with with with stable coin growth right now

right the the total market cap of stable coin is about 225 billion it's still quite small um in if you both look at kind of the just um the U the total the global macro landscape as well as even within crypto crypto market caps um but it's growing it's at an all-time high right now and and it's growing and um and I think the interesting thing about that is the US dollar is uh about 99.9% of of stable coins right now of course stable coins can be more than US dollar so one interesting area is like um you know might there be a stable coin that um pegs to a basket of goods for example rather than just the US dollar

or other um yeah like a CPI stable or something like that yeah um and there you know those of ideas have have been around for a while nothing is really stuck um there yet but like if I was if I was a country that um you know wanted to compete with the US that that would be you know on my radar right um but I think stable coins generally for the US they distribute dollars to new people around the world and they um they create net new buyers of treasuries right tether I'm sure you saw the headlines about tether in January is like they they did I think it was 14 billion in net profit in 2024 um and they they're one of the top 20 largest buyers of us treasuries now tether is and um I think the US

government knows all this they wants to put they want to put legislation in in place so that we start seeing even more stable coins like I think we'll probably see um some large US Banks launch their own dollar denominated stable coins I wouldn't be surprised if x has a stable coin I I agree with that actually that was one of my big predictions for this year is that you'll see fexs and tech companies and Banks issued their unstable coins and I think actually Twitter or X now like us they should have you know xus or USDX USDX yeah USDX is a great great ticker it's a great uh yeah no and and I think that there's a business model there I think you know we um we were uh very early involved in

Bridge um which um was acquired by stripe um last month and um they Bridge does two things and this is something that Zach has been the founder of bridge has been evangelizing for a while now you know one of the the the core products is um just provide kind of the infrastructure for U like businesses to use stable coins underneath the hood to move money uh faster and cheaper right um so like SpaceX um their starlink product um that they sell to n Nigeria um consumers um they take you Nigerian currency and then um bridge on the back end for them will

sell that Nigerian currency for like usdt and then move usdt to USD and so the the company wants dollars not Nigerian currency right so that's like the core um kind of infrastructure product but their other product is kind of um providing the infrastructure for um you know anyone to launch their own stable coin and um and that that's not as that product doesn't have as much traction yet but I think um I think it it will they're well position um this year um so yeah there's so back to that long-winded way of the the the initial tweet is like uh poly Market you know a lot of people say oh prediction markets

have been around for a while um like you know what why did it need crypto well I think it needed crypto because um the for especially for uh you know for political markets because until um this past year political markets were illegal in the US and um there was before stable coins on you know on on ethereum um there was no um easy way for like a product to get liquidity from the rest of the world and the reason why uh poly Market had over two billion in volume um last year is because they used um you know usdc um on polygon so um so that and

that was really the first and there's a lot of net new users of uh crypto that came in through poly market right um so it was the f one of the first products that like didn't require first like speculation on bitcoin or or Salon or whatever and so I think we're going to see more of those you have a sense of what of what some of these consumer apps could be are they consumer apps are they B B2B like SAS platforms built on stable coins like any idea of like I don't know just sense of what you're excited about there um I I think well I'm mostly excited about consumer more so than than B2B I would say um and like you know the re the reason I'm

um an investor is um you know like I I I don't have a concrete uh vision of like you know what should exist but I do have a pretty good sense of like the the areas and the founders that are you know that can build them right so I'm very much interested in like bleeding edge crypto products um like decentralized social for example is I think an area that's that's very ripe um for for something to to Really break out um and I think kind of the combination of like social feeds um that allow you to do stuff on chain um you know that that's

something I'm really excited about so I think like you know nfts for example like I think nfts will come back I think what's likely to bring them back is not the last generation of like uh where it was all about making it was you know 99% about making money like 1% about supporting the Creator when you have like in feed um easy to use um you know M nft mints um then it becomes like maybe 80% about supporting the Creator still 20% about Mak money so and I think like you know stable coins are are really good for that type of thing right where if you could um if it was easy to just get a stable coin in a crypto wallet and

then you could mint uh you know a a nft from a Creator you like for a dollar uh that that type of thing um I think is is quite interesting hey everyone earlier in today's episode I mentioned Petra a top non-custodial wallet developed by Aptos labs they just launched NN a new feature to access def5 with just one click earn lets non- us users deposit usdt directly into Aries markets lending pools to gain interest and rewards and manage it all directly from the Petra wallet Petra earn was designed to make dii more accessible for everyone you can manage your balance claim rewards and deposit directly from the app this is of course

not Financial advice participating in defi carries risks to learn more visit petra. apppp earn or by hitting the link in the descript description of today's episode hey everyone Jason here earlier in today's episode you heard me mention the weekly CIO Memo from bitwise in an industry as hectic fast and complex as ours it's incredibly hard to get an easy noons stream of what's actually moving crypto the memo comes from Matt Hogan bit wise's Chief investment officer he's been on the show before and he has this amazing ability to take the most complex topics and break them down with Clarity trust me on this one the bitwise weekly CIO memo is really worth the five

minutes of your time check it out at bitwise investments.com slci memo Empire or just hit the link in the description of today's episode to get started carefully consider the extreme risk associated with crypto before investing AO the hyperparallel computer is here a decentralized supercomputer built on top of rwe's permanent data storage AO offers infinite parallel processing and leverages web infrastructure HTTP for unprecedented scalability addressing limitations of existing blockchains AO smart contracts support large programs including llms and can execute autonomously enabling new classes of

decentralized applications utilizing tees for secure computations and features a 100% Fair token distribution to R weave holders and Bridge depositors emphasizing Community ownership thanks to rwe for making today's episode possible you can find out more by clicking the link in the show notes do you care if someone's going to have a token when you make an investment no no I mean like um I I that that was something when I started in in 2017 I launched one confirmation it was one of the first Venture fund crypto Venture funds might have been the first and um at the time icos were going crazy yeah um and um and one one

investor asked me um so uh what icos have you invested in and icos were going crazy it looked like everyone was making money from icos right and and I said uh not one uh like my focus is on Founders that uh are focused on doing something meaningful long-term and not just going for like a quick cash grab and um that that investor didn't invest like he he thought um he thought it was like a bad sign that uh so many people were making money from icos and I wasn't um but that's like always the strategy that I've had from the very beginning is like you know back good Founders that are

building products that are net positive pushing the space forward and I do think tokens make a lot of sense um you know for for many products so I do like I like tokens um but it's not required and you know what what I try to do is just be aligned with uh with Founders long term like the the um there's like token you know warrant agreements there's all these like deal like Str deal structures that have become like common in in the crypto which I I I don't like them um like I just what and and and sometimes I'll do them if it's like what the founder wants

to do but it's like just you know be aligned with the founder and and and believe in the founder and you don't need to restrict the founder to it's like I very much feel like if you put if you're trying to put like control on someone um you know that whether it's an employee whether it's a Founder whether it's a child um like they're they're not going to do their best um and so you kind of want want to just um you know support uh be positive and and let them be free and and so that's kind of how I I structure my deals and and I don't really don't like the token warrant stuff that that that often comes Nick how do you so i' I've now done 50 or 50

somewhere between 50 and 60 Angel deals and what I thought would lead to success with these deals is completely different than what I what it actually has been so what I thought when I started doing these Angel Investments was like you got to find like this sick product and like a design who really like knows how to do growth on social and an amazing product Builder and what it really just has come down to is like do are they willing to stick with the thing for several years yeah and most of the things that have worked where I've like made most of the things most by the way most of the things have failed the reason they failed is because the founders just given up or quit and the things that have worked oftentimes

the thing looks completely different than when I first met the founder they've just stuck with it they've done layoffs they've hired they've done layoffs they've hired they've seen many cycles and they just have a very long-term view how do you um sus that out as a in like your interviews or your your the fundraising process yeah uh great question and yeah that that's certainly true um I would say our kind of uh one of our um requirements I would say from Founders is like showing um a deep historical knowledge on whatever the area that they're building is and and um there's got to be context there's got to be some

understanding so if they're building in prediction markets by the way like Shane is a good example of this from poly Markus like Shane knew everything about augur he had a view on like what was good about auger what was bad about augur what was good about Veil what was bad about Veil what was good about in trade what was bad about in trade and um and that type of um like care and understanding of what's come before is is kind I would say the main thing that I look for um because there's a lot and and that's not to say by the way that that's the only way you can make money from you know from investing in that type of founder I think there's lots of ways to do it um but I do think you need

to have some strategy that's that's you know something Beyond just chasing just making money right and um and that is a good way to filter Founders that I think are are more opportunistic right it's like kind of the the classic uh you know mercenary versus missionary like we we we tend to prefer the the missionary who has some care for what they're building Beyond just like a a good opportunity so that's kind of you know it some of its Vibe some of its gut feel um but specifically like I always want to dive deep on what whatever the area that they're building like what's their knowledge of what's

been attempted before because that's that's a great thing about crypto too is like there's uh everything's open source um you know there's a lot of different experiments that are kind of publicly running there's a lot to learn kind of at all times so um like you know there's a lot to learn from you know good things and bad things I mean for example pumped off fun um you you know there there's probably an opportunity for someone to um do a version of pump. fun that um is somehow more uh pump and dump resistant right what exactly that is I'm not sure but like that might be a you know and you know if it was a Founder building

that I would want it I would want there some insight that's not just surface level right on you know what happened at pump what was good what was bad and you'd be surprised like especially in Silicon Valley there's a lot of Founders that just are are chasing narratives um and don't care that much and don't kind of do uh the real work um to understand like the historical context yeah I completely agree with that by the way I I it's like the two things that or maybe I kind of look for three things it's like what's the co-founder relationship because that that has also killed a lot of companies um that I've invested in and then the other is like will you stick with it for for several years and then the third is like can you give me

like an oh wow Insight can can I walk away from that conversation like wow this person knows everything about this topic and has actually made me think differently about this yeah but more than anything like I think and it's probably a combination of the things you mentioned I I think it's like care they they've got to care like I think I think I look back from what you know when I started um when I joined coinbase in 2013 to now um there's been so many people that I've seen come and go and I think the reason I'm still here more than anything is not because you know I'm smart or um you know whatever it's because I care like I genuinely

care and you it's hard to fake that you care about what you care about like decentralization or like bringing like holding truth to the institutions or you care about ethereum or you care about Bitcoin or what do you care about I care about uh crypto as a tool to Empower people around the world and um and lift people up um basically like I think crypto at its core is human empowerment technology and um I care about bringing that to more people yeah do you think coinbase is a good Steward of that mission n yes absolutely yeah what do you think happens with coin do um I think coinbase is a phenomenal Steward of that um I

think I I think coinbase is one of the best companies in the industry um I really like what Jesse is doing with Bas um I think that they're like not the Saving Grace of ethereum I'm I'm a little more you know bearish and pessimistic on ethereum or have been in the in the past but I think the reason that ethereum will ultimately work out is not not because of Bas and Jesse but like I mean man they are doing some good work to move ethereum forward I would say um but by the way I I'm I'm by no means like I I like I think ethereum I've been ve very bullish on ethereum like you know in my post and stuff because I am you know I love ethereum I think ethereum you know for crypto to

win ethereum needs to be strong but I I'm no means a like ethere by no means an ethereum maximalist and I also think ethereum and this is kind of something I think about with Founders it's like the there's two things that are important creativity and competi and competitiveness okay and I think um like ethereum critique of ethereum would be lack of competitiveness I think ethereum there's there's and we've we've invested in some Founders that were maybe more on the creative side and a reason it didn't work is because of lack of competitiveness so I think ethereum needs to be more competitive there needs

to be more kind of competitive will to win I think there is it um and I think there is and will be but um but that is like a I would say a um a critique that I that I have on ethereum um and I think there are other ecosystems that are like hyper competitive and like Solana would be a good example right like I think there's like hyper competitive but really lacks creativity I mean what what's something creative that's come out of salana would you how would you fix ethereum if to how would you make them more competitive you tell vitalic to get on Twitter and start like how like how do you make them more competitive um well I don't think we necessarily no I

mean it's it's and it doesn't it also doesn't need to come from necessarily vitalic like um I think and I have this conversation with some like big Wall Street investors who like they they they're worried about ethereum because um there's other projects that have these uh big public figures that are now like going to Washington DC and meeting with everyone and um they they're they're company coins right um but a lot of investors are used to investing in companies and so they see that what what looks like you know these company CEOs that are leading a certain way and um and they are um concerned because ethereum doesn't have that I don't think

ethereum needs that I think why ethereum wins longterm is because of social scalability and Nick Sabo um wrote an awesome essay um on this in I think 2017 have you read it um I I vaguely remember it being was it about Facebook and why either bit I think it was Bitcoin will scale it it mentions Facebook but I mean the basic idea with social scalability it's like in an institution decentralized things can scale more than then centralize things long it's an institution's ability to um have have people have skin in the game basically and benefit from the success of of of the

institution um and like bit and and and yes he uses Bitcoin as an example it's more socially scalable than like any institution that's come before it whether it's you know any government or uh payment networks because there's no person group or even country behind it right so it's like if you think about it Bitcoin was like the first technology that people in China used just like people in Russia used just like people in the US and and every country around the world and it's decentralization is a big part of social scalability right um and so if if you're a u if you're perceived as like a a US company coin is that socially scalable to the globe what

do you think if you no no no no you're not no yeah so so I think ethereum you know like people in the US are worried that like oh ethereum is not going to be in the Strategic Reserve or something because they're not in no one's in in DC lobbying um and um I think I think ethereum will be you know if there's a strategic Reserve you know eth will be in it um because other than Bitcoin it's the only um you know truly decentralized uh currency that both is censorship resistant and decentralized from ownership perspective and um and actually not having like a figure head

that's dictating or loudly competing is actually a positive for that so I think that was a long-winded way of addressing maybe your initial question was like how do we get ethereum more competitive I think it's just I think it will happen naturally um and I think but I think you know talking about it um and maybe pushing the competitive side more could help yeah um let's did do you know Nick Sabo did did you ever meet Nick yeah I met him um in only once I don't know him well but he was actually raising money for a um he was going to build a like decentralized Stock Exchange product um on on ethereum actually like like Unis swap or

something well it he was more focused on real world assets so like stocks yeah um all right let's shift gears a little bit um you let's talk about nfts and like memes and media and stuff like that so I've heard you talk a few times about I think it's kind of the intersection of I think you guys did the the dgen investment and I've heard you talk about like the intersection of memes and media um then I saw you guys just acquired the Mi bits IP with Serge yeah um I think you guys own the largest institutional n nft vehicle today um I just love to get your view on like there this like interesting thing happening at

the intersection it's like nfts coming back and memes and like new age media and onchain creativity and it's like I don't really know how to Grapple with it or make sense of it but I'm curious if you have a strong thesis around this right now um I I think my my love for nfts is because I think like nfts bring more creativity to the world it's like nfts fundamentally are a business model for creators right that didn't exist before and um and so I think you know I I that's what nfts are about and a lot of people I've seen compare like the meme coin stuff that's happening on pump to um to nfts which to me is um you know there's similarities

right because with nfts because of the open ethos there was a lot of garbage too but there was also a lot of creativity right like nfts um produced uh you know crypto punks and B and art blocks and x copy and Daniel Allen and like a lot you know much much more those are just some of the bigger ones there's like this is like these are real creative people that are like here to stay and probably only going to get bigger um so that's that's what I love about nfts and I think um like I think as the ux going back to like social feeds and ux I think it's like the first the the V one

of nfts was um was still mostly speculation and like there was a lot of good creativity there as well but um like I think as ux improves we'll get you know we'll get back to supporting creativity and um and I think um I believe in nfts as an asset class like why why we have a vehicle is that um the thesis is very simple like just like uh traditional rich people collect uh tradition art and Believe In traditional art as a store of value so will crypto rich people um with with crypto art and so I think like do what do you think they

buy the things that I named right crypto punks yeah ble uh x copy um you know many more those those are some of the top ones um super rero one of ones I I you know OG super rare one of ones um like true art right where you know the like the the the creator of um AI generated nude portrait number one do do you know that piece yeah that was the Genesis mint on super rare by ro Robbie Barat and this is a guy who um you know he a young kid at the time that that created this artwork and he um like is the opposite of like a chaser chasing

money right like when when money came in nfts like he left he was like [ __ ] this I don't you know I'm not interested in in in the chasing like those are the creatives that um that I like and um and I think that lead to you know great great work that kind of persists over time so um so yeah that that's kind of most crypto rich people I know still don't have any exposure to crypto art and I think um I think it's just inevitable that as crypto grows the you know some of that goes into kind of high-end um yeah door and that that's just the that's just like my core thesis on on you know nfts today but then there's also a whole a whole lot of

other um kind of new use cases that yeah that's that's the nfts from the Collectibles lens right I I I've also heard you I think it was your Tweet you said the biggest Global media brand will come from nfts yes and that I mean that piqu my interest as someone who runs a media business I'm would yeah just love to hear your thoughts here yeah I think my my um by media I meant like um there's different types of media Brands but if you like um you know Hello Kitty and Sonic the Hedgehog and Super Mario Brothers these are some very like these are very high grossing like annual revenue um kind of corporate media Brands and I think that like the idea with Mi bits for example is that there's

really great IP there can we take that IP and build um you know an awesome game uh with the IP or or um a a TV show or um you know um toys things like this right so I think I think being c community owned and having great IP is like the start and then if you can combine that with like you know content or um you know real world Collectibles that um that make it um make these things more interesting and useful to people I think that's that's how you grow I know you talk about skin in the game can you tell me about just durability of the game you've

been around since 2013 been investing full-time since 2017 I've noticed you don't participate in some of the like Inner Circle games I would say or it's um I'm trying to think of the right word to put on this but like you know you don't you you I feel like you skip a lot of the conferences you're not in you're not on you don't do the podcast circuit as much like is that related to just durability is that just like it you don't get the value from it like tell me about just durability and and this other aspect of like not really being in that Circle okay I think um something that many can flate is um being a uh like an influencer a con a

content creator a media person and being an investor I think they're two very different things um and that often have very different skill sets so I'm focused on being um like a good investor and that requires um an ability to like think differently than than the herd so like I moved out of San Francisco because um you know I we had an office in San Francisco and we were kind of um doing the traditional like Silicon Valley VC game where you know every founder would come pitch us and um we were you know competing for deals and stuff and that um that wasn't the most productive I would

say I've actually found you know this is this is surprising to me but like for where we invest at seed stage right we we write like1 to4 million doll checks in like pre-product or very early product uh you know projects um there's actually a negative correlation between how hot a deal is at that stage and the outcome um so like the hottest most competitive deals were actually like the worst performers and our best performers were uh were actually not that competitive um at all and so the um I think you know to do well as an investor you really need to get out of kind of the herd mentality um and that's that's

like kind of what works best for for me and and for our our fund so um so that you know and and that's different than if if you're um you know if you're a content creator um then you want to get as much attention as possible and real and really to do that you need to be um kind of part of the discussion all the time chasing the the current thing and some and things like that to some extent right and so um yeah that's that's just I like investing I like I I by Nature I'm like a contrarian and um I think being out of kind of the

you know the bubbles uh you know whether it's Silicon Valley or whether it's kind of crypto Insider bubble or whatever um like I I still like talking to people um you know but I don't I don't it's not like a super important part of like what I do what I do what what's most important is like that I'm a good partner for Founders that that we work with and that um you know I'm also using products and and and staying at the bleeding edge of you know what's happening with new products so why did you leave the San Francisco Bay Area um well kind of partly related to you know playing like the Silicon Valley

game there's very much like a bubble where you get you know if you're around people playing that game that can pull you in more and um I think you know we live um in kind of a remote area um now where we can it's it's easier to just kind of be a contrarian I think um that was part of it um the woods will and the forest will help you with that yeah and um also just um I've got a bunch of kids and um I think you know the city is not great uh for kids so um so those were the main reasons nice Nick man I always enjoy chatting with you I

appreciate the time thank you appreciate it n [Music]