FOMC Down Only, Gaming Mega Thesis, Stablecoin Bill | Roundup

Transcript

you know it's like people showing up with horses to World War one uh you know like when there's tanks on the field it's like oh [ __ ] like did we we misjudged this I think you know that's kind of like where this might be going it's like congratulations you have this album uh it's integrated into approximately zero games uh because you know that's not just not what consumers want and we just need to build for a broader consumer constituency I think that's where we're going before we jump into the app quick reminder that nothing on bell curve is financial advice everything is just a meme hope you guys enjoy all right guys welcome back to another Roundup of bell curve you're joined by Michael's one and two and Vance no Yano today getting married choosing marriage

over a podcast I don't know what's up with that guy yeah cut I know we'd have to have a serious talk when he gets back it's pretty messed up that he's doing this but uh he's more dedicated to this Pawn or your wife exactly well I hear he's getting a massive Dowry uh for the for the wedding so it all kind of levels out it's just do it into self-interest yeah all right guys we've got it's been a little bit of a light week for for stories but uh you know I get we we had this thing we were going to talk about markets I keep getting called macro Mike so I hate bringing up charts on this podcast anymore but uh any takeaways from basically fomc happened this week basically it's just down only uh you know it's all doom and gloom Dollar's ripping up yields ripping up everything

going down is there any takeaways other than that like any any Nuance that I'm missing the charts aren't looking good boys I don't know I'm like high level I'm still a firm believer and like you probably should be bearish when interest rates are at zero and people are buying mortgages by the hundreds of billions per month and you should probably lean the other way when you know like the world is about to end the dollar is taking out you know it's 25 year high out of 10 years about four percent like you know it feels like you kind of need to lean against the crowd in a lot in a lot of scenarios and this is certainly kind of one of them at least in our opinion well so one thing that I thought was really interesting is actually as

soon as the announcement happened and 75 Aces points was the official uh announcement markets actually went higher and then what happened was chair Powell comes in and says we actually might be going through a correction in the housing market and that's when markets dropped and and so I think it's more nuanced than just you know what is the number what's the Top Line figure but man if we're about to go through a recession in the housing market things are going to get a lot tougher especially given the fact that mortgage rates so not only mortgage rates have gone up they go up with interest rates the amount of mortgage payment per month has in some charts I've seen has two or three acts so imagine your variable rate mortgage has

just you know 300 increase like that sucks yeah I think that's the you know there's a it's there's a chart out there that uh it's like the percentage of disposable income that goes to your mortgage and when housing prices were Rising that percentage was actually going down because of what interest rates were doing but now it's this like historic you know rise and it's like more than doubled it's like six and a half percent or something like that it was below three you know nine months ago so it's like that percentage of disposable income is just way way up and exactly yeah I don't like have you guys looked for housing recently I feel like I whine about this all the time but I live in uh in Williamsburg man it was Insanity trying to find an apartment

they don't even exist still yeah like a month ago I probably saw 20 you know it was like to give you ballpark figures I feel like you probably could have gotten an apartment like rented a place it was like decent for like 2 700 bucks a month like one bedroom now it's like there's nothing don't even bother looking if it's below four like a month and there are people you know they're like [ __ ] Wars like you go to these apartments and it's like you know there's a line out the door and you've got to put down the I got a place I had to put down a deposit site unseen for an apartment and I just saw the listing 30 minutes before that's how ridiculous it still is yeah so I mean pretty much everyone's trying to sell their house it feels like

they're cutting rent prices like if you show up at the open house like I think you win um it's uh it's kind of the opposite story in many effects but wow all entirely surprising like in San Francisco specifically it feels like kind of like all the Enterprise sales team Bros have moved out um and that has like constituted a large part of this population like for Michael and I live which is um we're not going to give exact locations but like the north side of the city I don't know it's kind of like depends on where you live honestly San Francisco prices have gone down over the past two years and there's a there's a really interesting article there's actually been a few articles that have come out about it by the end of 2022 40 of San Francisco commercial real estate will be valued

that the thing about the wild there's 75 million square feet commercial in San Francisco and and something like 32 of the 75 is going to be vacant it's uh there's gonna be a lot of a lot of really interesting changes that come through in this market insane is either going to Nuke itself or it's going to have some sort of Rebrand into like I I don't even know what but it feels like the city leaders are starting to kind of like realize it and and Tack a little bit further into like the we love technology wind that they use to embrace yeah um what is your what is your guys opinion I don't want to go too far down the just San Francisco route but like I hear so I've been to San Francisco like two or three times in my life always seemed pretty good to me the way people

describe it in the last like two years is like it's falling into the ocean like it is Sodom and Gomorrah over there like fire and brimstone is all but raining down like what's going on over there um it's an inch yeah what is going on well so I think you have a really interesting mix of some of the most Progressive people in in positions of power um you also have one of the largest if not the largest I think Metropolitan budget per year uh but you also have one of the largest homeless issues and uh and so you you put that all together and and you get into a situation that I I think is you know is going to have to

change um San Francisco leadership has done basically everything to um root out all the all the economic centers in the city uh and I think a lot of the people that live there you know my myself included I think vanceville is the same way frankly I love San Francisco because of the proximity to all the places around San Francisco the city itself is not you know the reason why you live there in my mind um it's the proximity to Lake Tahoe it's the proximity to Marin um and right now like the city itself has to reinvent itself yeah I mean I I moved here after the Gold Rush I moved here right before the pandemic and so like I never even really got to see San Francisco ahead of time um and so like you know what I've

experienced in San Francisco is like super intense work everyone's [ __ ] on it telling me I need to move but like you know like the people who moved to like Miami and New York like I haven't found a lot of like super like long-term happiness stories there and like Michael and I's lives are like pretty small like we go to work we kind of work out like we wake up walk the dog whatever it's like pretty self-contained it's a beautiful city so I like it and the more people [ __ ] on it the more I kind of find a reason that it can kind of like reinvent itself because like all the things that people should own it for are either like irrelevant or those people have already moved out so it's kind of like you can mold it to whatever you want which is cool

yeah what do you guys think about uh I mean markets it's really weird uh if you look at just like what the NASDAQ did basically after that film series like this weird Spike when you got the 75 basis point hike and then to your point Michael yeah it's basically been dumping since maybe on fear of some sort of housing recession it doesn't actually seem like crypto's reacted that negatively like I mean it hasn't been great I'm not gonna look at these charts and be like hell yeah but I mean it could be a lot worse I sort of think um so I I don't know if you guys have any opinion on that and the other thing I'd love to get your thoughts on Advanced we were kind of talking about you know how at the end at the tail end of a bull market when everyone's kind of accepted

the Bears there's like this last people are kind of holding on to their their bags in general um but very often right like anything out of with very few exceptions right like each kind of being one of them from the last cycle most these coins will basically never hit their all-time highs again so I'd be curious to get your take on just overall state of the the crypto market and then maybe specifically like why that tends to be the case like why some of the high flyers from past Cycles they never you know kind of break through yeah I mean this is something that we've noticed with like people we talk to Junior people on our team that are kind of like you know when the market comes back and like you know like this like dgen D5 like you know super like crazy nft pfp projects come back and at some

time it kind of you don't like have the heart to tell them that like hey like it's gonna like not be the same and it's gonna be way different that's almost like the point in 2018 you know in the summer of 2018 like all of these people were basically saying that the Ico Market would come back and then it would be interesting and that would be kind of the thing that would push the market forward just basically like a return of old behavior that was not sustainable um and for us like that just doesn't feel likely at you know where the market is going or towards things like games or the projects with the utility are things like regulated D5 or at least like more institutionally oriented defy you know things like we've talked about like X margin and Maple and things like that like those are the things that we think

are going to be powerful but as a result like you have all these people holding onto these old Concepts um very like strongly and they don't want to let them go and I think that's kind of like the next phase of the bear Market that we're going into where people are just kind of like all right Uncle like you know whatever like you know what we're doing isn't working so like we kind of need to throw all the cards in the air and like see what land space up and then go after that um and I think like what I look for like what are the really compelling alternative Visions for the future uh that like people can you know push forward crypto towards and I think like gaming and specifically like free to own and things that have like a low barrier to entry those are the things which get

us excited on the consumer side and like one of these podcasts that we listen to it with Gay Blade and like the whole thing is he's calling out like axi the pfp Mania like all the games on the ethyl one as we know them it's 60 000 daily active addresses like if we grow that 10x it shouldn't be that hard like we can build something disproportionately valuable we don't need to hold on to all these things that we kind of remember from the last bull market because frankly like most of them will come back I mean 10x what about like 100 or a thousand X you know 60 60 000 is nothing right uh yeah I think one of the other things too is that uh so totally agree with everything van said um you kind of have what's going on in the markets right now is you just you can't

sell when you've already sold everything and and I think at this point uh you know we're kind of reaching That Rock Bottom place where you know there aren't any more for sellers there aren't any more you know liquidations that are happening that require people to get rid of their assets you're starting to find in a lot of these assets I I think what you should consider to be deep value and you know you're now looking at it in terms of you know what's this thing actually worth and to go back to the other point that man said all these things are are really going to have to change their narrative like there's gonna have to be a new narrative that drives this stuff forward and every single cycle on crypto it's a new thing that pulls everything out uh and and right now I I would agree I

think gaming is the only viable chance but it's also probably the best viable chance that we have to get a hundred million monthly active people with wallet addresses maybe they don't necessarily know it it's a custodial wall they're interacting with but they're going to have a wallet on the back end of whatever they're transacting with and and I don't think it's going to be something where you you know you buy an in-game asset for ten dollars because you expect to be able to sell it for a thousand in a week I think it's going to be more like you buy an in-game asset you use it you play with it it has fundamental utility and maybe you sell it for twelve dollars or 15 or maybe even like five but like the the speculative nature of what all these assets have been so far is I think

actually at odds with the adoption curve that we'll see with games you know the second you have the ability to have something go 100x or 10x even the game is over yeah I want I want to get into games I just want to get one your take on one with just about dapps and like the ability to underride dapps let's say in more in defy I think one of the one of the reasons too why like old old coins basically never see all-time highs is probably they're just like Paradigm changes right and it's very tough to uh you know keep up with new things in crypto Cycles but I also think one of the pretty consistent things that drives adoption in crypto thus far has been rewarding early users um and I think one of the reasons why it's difficult for adapt to Tran you

know uh succeed across multiple different Cycles is you know in one cycle you kind of give away all the rewards that sort of make sense to give away and then you're competing with other adapts that may or may not have a better more improved product but they haven't um I struggling blowing their proverbial load so to speak on all the rewards right right out of the gate so do you do you see that as being like a major impediment for why some of these daps like don't you know tend to reach uh you know persist over multiple Cycles or ever reach their high again or what do you think there's a really interesting chart that I think Chris Dixon put out uh which is basically like the network effects with tokens applied to them and uh a lot of his point was we can break

down the the cold start Problem by incentivizing people with tokens you can jump into a network you can be incentivized for being early and you can get access to the network and appreciate in the value in in the network as it grows the problem with that though is that what happens when you have the the long-term effects of when people aren't receiving the same amount of tokens where you have the early class of users who are rich with tokens but you know the the million in first or the the 10 million in first person that joins the network isn't able to get the same amount of value and and that I think is you know kind of where a lot of that model breaks down and we have yet to see a good kind of use of tokens to be able

to solve that problem we haven't hit anything that has 10 million or even you know really a million uh daily active users but you can imagine the situation where if you don't have the ability to incentivize people at that late stage you know think about the the comparison of uh the value that you get from joining Twitter as the 10 millionth user well the fact that you're joining Twitter means that there's this whole network there's this whole communication and and content that's in there and it's actually more valuable at the later stages than at the early stages with with tokens it's the reverse and and so I think we really need to think long and hard about how you make it you know the 10 millionth user is just as valuable uh using a token model as

opposed to you know what you would get if you're joining a social network yep most token Mission curves look like this I go down and they flatten um and if you look at Helium like you know they've spent the meat of their token Emissions on getting these hot spots distributed and it's like not clear that they're in the right hands of the right people it's not clear it's like the right Network functionality or bandwidth or like the right part of the spectrum like I think you're going to see a lot of these token projects that like really tried to hit escape velocity with this first shot of tokens and and now like don't have as many to kind of go around for the next whatever they're trying to do um and that's another way you can lose it's just like if you shoot your your shot too early

yeah you know there's another funny funny thing about how tokens work as opposed to equity like equity and maybe this is a holdover from like the way Bitcoin worked but it's kind of hard cap fixed Supply 21 million but a lot of these tokens when they come out they're like hey this is how many tokens I have right and then they kind of break it down into like these different use cases some of it's for the community or the developers or for incentives or whatever and there's this idea that you can't go over that Supply but that's not how Equity works right you sit down and you like have a cap table right but then you issue new shares either at every new funding round or whenever the board basically says you can right there are these kind of predetermined Milestones it's just a funny thing in terms of uh

maybe that's a something that exists right now that shouldn't really necessarily exist because why why would you put a hard cap on the amount that you could issue it's a question of if you can get more in return for what you pay out in equity right it's just a it's a capital compounding problem not a hard cap problem I think look what Adobe did last week with figma or or you know supposedly we'll we'll do with you know when that deal closes you know 20 billion acquisition 10 of it was in cash but 10 of it was just in stock that was issued and and so it's the ability to take this cap table this existing you know liquid asset that trades every every single day on the NASDAQ and create more of it to go off and buy a company uh I I you know I I

would love to see the data and I think I've seen that from a couple years ago but it's somewhere around like three to four percent is the average uh inflation of uh stock uh per year per you know I think New York Stock Exchange or maybe NASDAQ but you know on average three to four percent of stock is issued just in compensation to people that work there for Acquisitions um and and that's the net of BuyBacks as well um so even with BuyBacks being one of the core value drivers of these different equities you're still seeing a positive inflation rate it's really interesting um I'd love to get your guys thoughts on just gaming in general there's a really great podcast actually from Gabe Bladen

uh there's a good suggestion Vance um maybe before we get into the specifics of that pod I know you guys are pretty opinionated on this and are looking into it pretty aggressively could you just like lay out what's your if you had to just what's your thesis for gaming in web3 I know you guys are very positive on it but if you just like kind of play out what your overall framework for what it is and what the opportunity is yeah so I think it's like for us less of like like are Michael and I gaming people no I mean we're like consumer technology people Michael work at Snapchat I work at Netflix like we both have lots of friends that work at The Gaming Community but like we're not like you know like super overzealous like Starcraft nerds we used to play all those games

but like that isn't kind of like according to who we are I think what things that interests us more are just like the market dynamics uh within gaming and as it transitions over to crypto so like on the demand side you have three billion people a year who play games uh there's a billion people a billion five people who make less than uh seven dollars a day who have an internet connection um you know and so like these are going to be the first natural users of these games because like you know it's probably not going to be play and or play to earn it might be like play andrin as like a byproduct um and so that's powerful and so like you have the latent demand and these people look and feel and act like crypto native users they do things in digitally endogenous ecosystems and they transact

in Virtual currencies like it's like we're close cousins you know somewhere along the line like we got separated um and so that that's the demand side the supply side is um all the game developers in the world who for the past 10 years have relied on mobile free-to-play advertising to power their business model and right now there's a thing called I idfa which is the unique identifier that developers use to track users across different devices and they use that to retarget them with ads and the retargeting is basically like the most powerful aspect of the like e-commerce advertising uh like ecosystem that stands today where it's like you have more data you retarget you get more specific like you get better CAC you get better LTV and that's kind of like really the thing that powers the flywheel Apple removed that uh and like

you can see that in Facebook's earnings like they went down a lot they went down Snapchats or anything I forget I think they're like u4 up last year when they got announced and Snapchat blamed them and so like all these developers the supply side are basically saying uh we can't make any money or current business model um we need some sort of new type of game that we can build that you know has some new modernization um and we need to have it done fast and so like 70 of all pitches that we see are games and it's like kind of like this like Refugee movement of like you know like we're coming to this new land and like they have all these like shiny new objects and we create new games it's better modernization like people already getting rich and so like you have the

demand you have the supply and I think in between that you have the blockchain and the blockchain is just something that like you're seeing new emergent Behavior whether it be things like dark forest or whether it be things like step in or whether it be things like axi like call them speculative call them whatever you want like there's something there on some Dimension that's working and so yeah I think like that is the the reason for our bullishness um I also think it's kind of like you know uh these are the times in the bear Market where you need people to come up with like compelling alternative uh like you know visions and shared goals for the whole ecosystem to go towards and by process of elimination like D5 I don't think it's gonna be the thing that pulls us out of it I think

it's gonna be a very large industry that benefits from the upswing but it's not going to be the thing that actually catalyzes that movement music is too small um content slash Ecommerce is just like not quite there yet um and gaming is the world's biggest Market we see we're seeing all the pitches like process of elimination this is where we're going um and I think the thing that we have that a lot of people don't is like we see 3000 [ __ ] a year I guess everything we have the we have the bird's eye view 3 000 pitches have so many I mean on any given day we have you know uh probably five people taking you know probably like five to ten pitches each um and you know over 365 days you know that adds up uh and so yeah we see a lot

of stuff and all of us launching in q1 so we're gonna find out pretty quickly uh if we're right or wrong it'll take some time but like it's not something that we have to wait 10 years for is the point like this is a rival uh vision of the future for 2023 2024 which I think what people are looking for right now and fully agree with all that the only things that I would add just to you know Hammer these points home uh three billion monthly active users around the world uh 200 million yearly Revenue which is larger than music movies and art combined the entire industry of music movies and art you know that's that's kind of the

scale that we're talking about uh free to play represents about a hundred of the 200 and the way that free to play monetizes is you have on average somewhere between like one and four one and three percent of your users who are actually buying things in game you know and and this is a lot of what the podcast talks about but you know free to play was this this movement that basically everybody in the game World said no way never gonna happen not going to be a viable business and completely change the game industry forever I I think if you if you think about you know one to three percent monetization um but you're spending all that money and the second that you as a as a player of this game spend that money in game you're buying virtual currency you're buying virtual assets you're spending it

the second thing you stop playing the game the money's gone you know it it has literally left your wallet and gone to the developer and that's it if on the other hand you were ascribing value to something that had a secondary Marketplace for it you had the ability to recoup some of that value maybe you know if the game gets successful and you have something that's a more rare item you can actually realize a profit on top of the money that you spend in game well what do you think that monetization rate goes to I mean our gas is probably it goes up 10x you know you're talking about like 10 to 30 percent of people actually monetizing in-game if they have you know a pretty solid understanding that they can recoup a lot of the value and so you know are these games going to

be differentiated yeah totally eventually but right now they look and feel exactly like the games that we've been playing you know for the last 10 years the major difference is the business model behind them and I think that's you know where we're seeing a lot of this you know aggregation of games ultimately get to in the next call it 12 to 18 months it's really just kind of the same games and you know people know how to build games people know how to build successful fun to play games but now you're talking about a 10 to 30 monetization rate in a new business model behind it so you know I I think that's really what's going to be the first powerful narrative eventually you're going to have these games that are interesting because they have a Marketplace but it's just going to take a while for people and and frankly

um all of the interactions that that people are used to it's going to take a while for them to get used to a Marketplace as well yeah I would so just to just to make sure I'm understanding kind of the uh um and then we can kind of get into like free to free to own right the you know gay Bladen sort of thing but basically is the idea that so all this gaming Mark that exists today it's um yeah roughly 50 so about 100 million dollars worth that is uh what's free to play is the is the terminology for it yeah and that's basically you get monetized to like in game their ads or does that include like buying things like that you're buying like a hammer or something or some sort of upgrade or whatever for uh and Gamers hate that because it like it influences

you you don't want to be basically able to pay your way right like being better in the game it's kind of like it's seen as you know not not great obviously right you kind of want to actually earn it um so so pay to win is actually a pretty dominant narrative in different geographies and and one of the things that I think is really interesting here is that every every kind of population has a different dominant game or game type uh pay to win is actually really popular in China and in parts of Asia it's not as popular in the US and and EU but you know you can't have models where pain to win is is the dominant game model so in China they're like all right enough of this [ __ ] I just want to

win this game I will I will pay I will win this game um so what's the you know one thing that um I don't know if you guys ever played a lot of games soon I wouldn't have called myself a gamer but I definitely played a good amount of Xbox and uh I I definitely remember doing things like I played a lot of Halo 3 was kind of my my game and I do remember going on these like quests right and the the friction for going on these quests was enormous because I couldn't drive at that point I'd ask my mom to like take me to Toys R Us and like get the guidebook for the game you know then I had to like compete you know I had to re-beat the quest that I already beat on a legendary value then I got collect these skulls and I got this

Hayabusa armor and the whole reason I did that because I had three nerd friends that would come over and I'd be like you see this armor let's go you see this yeah very tight uh so just imagine the amount of like friction that I had to go through for a relatively small reward is basically the idea for how nfts and how nfts and games kind of end up you uh increase the size of that market is there's interoperability between okay I can take this nft out of this game and move it into that game is that kind of the idea or how do we increase the amount of people that are spending money in game it's not it's not the the interoperability I think like that's

actually one of the things that doesn't make sense with getting pitches it's like we're gonna take this sword in this like perfectly balanced like crypto economy and we're going to put into this like other crypto economy that doesn't have a concept of a sword and it's gonna like be awesome but really it's just gonna like mess up everything like we just like don't really believe that maybe if they're like close cousins and it's like the crypto Halo 2 versus Halo 3 you can bring it over like TBD but I think the more compelling thing is like the price points to get into these games are very meaningful and and the economics of like the revenue that's generated is like extraordinarily power on distribution boards like three percent like to Michael's point if you don't have things that you need to pay for and you can instead incentivize this

game where you mint the nft you know that nft has like future rights to more nfts like you incentivize this velocity based economy instead of like this aggregate dollar based economy you don't have to charge people a ton of money you can just have them have these nfts and have actual upside ownership in the game and that's enough to get you know the just the rate of monetization up and so like you look at you know the 60 000 daily addresses on ethereum today like they are spending a lot of money but they're also creating a lot of value for themselves and others who are holding these collections of pfps um and like that is like the core concept where instead of having this like very kind of like predatory you know like monetization CAC and LTV based game you're actually creating something

that has communal value and so like sure maybe people are spending more money on that but like the uh the digid IQ nft pfp collection that's already traded 70 million dollars of volume like 70 million dollars of value has been created and so like sure if you break 10 of that like you're gonna add to your games economics and that's what's like fundamentally powerful um and if we can you know have people get there for and that so there's like two other Concepts which are really interesting in the Gay Blade and podcast one is like this concept of like the billion dollar nft and uh like right now if you look at Apple the most expensive thing that you can buy on Apple is 100 like it like blows that up like that model changes completely like it's hard

to understate how important that is um and so like that's kind of like one big thing where you know like you just have like these new skus that you can create like you can have a billion dollar nft that's Community owned manage like all these different things are possible but the second part is just like um there's only 60 000 daily addresses on eth like yeah something special about what's happening on ethereum and the concept of eat This Money where like we've always thought about like like how do you onboard someone into web3 I'm just gonna send you eth it's like what do I do with that eth it's like you look at it it's there it's like no it's like here's nft it's in a game I'm just going up actually it's pretty good that actually works

you know if you have someone that's playing a game that has an nft that's like lagging their way towards a whole eth like onboarding people into ethic the currency via games is like something else that's like crazy like that's how eth gets back to like you know 15 000 each spent per day it's 5K breathe like that that that's what drives that in my mind it's basically the only thing they can yeah to piggyback on that concept I did it was actually a little bit of a a light bulb for me listening to him describe maybe what the almost the customer journey of how people might get into crypto and and end up holding more eth because I'd always been thinking of it from the perspective of you know games and Eve kind of makes sense because if you're a kid again going back to my days

playing Halo uh you know if you did want to buy something online like I'd like borrow my mom's credit card it would be much easier right if you had a way to obfuscate that right I think kids would want to spend money on games but it's like how do you how do you do that because they would have to buy Esa how would they do that but honestly getting an nft and then having them acquire eth that way actually seems like the much more intuitive now that I see it that's probably a more intuitive way to get people into the ecosystem I mean he's he's the one that coined it but uh free to own is you know the replacement for free to play and being able to have ownership in an nft that relates to a game in maybe even a fungible token that

relates to the governance of the game you know like these aspects of ownership I I think there's a lot of value that you can ascribe to that uh and one of the examples that he gave is I think it was the Reddit uh the Reddit nfts that were giving away for free you know imagine just like having an nft and just the ability to say that it's in my wallet I can prove that it's there and and maybe it's worth 5 10 15 100 bucks who knows but like I got this thing for free like I I think free to own is actually going to be the mechanism um and you know it all relates to ownership the the other thing I think is missing is like um so assume that you know art might like you know 12 year old cousin gets

into this stuff and I give him his first nft it's free to own and he like you know he's playing in the game he's trying to like that into eth I don't think the end I think the nft markets will change where it's like all like nfts for each basis I think we're gonna see kind of like swap markets come into like being very popular where it's like I have you know these two Halo skulls I'll trade you for the Hayabusa armor because like if you're 12 years old like that's the that's conceptually what makes the most sense to you because you're like I have this thing I'm trading for that thing like you know I'm eventually gonna like my way into each but it's not just gonna be like I have this one ft straight shot to eat like you have to there's more imaginations

that you need to go through for that to really work um do you think you know axi tried to build that I think still has I don't know if anyone uses it but Ronin right so like they there was a there was a period of time where I think they also saw this in-game economy that they were building and there there was a point where I was like well are we gonna basically leverage existing um dexes or are we gonna try to build our own Decks that I think ended up still leveraging uniswap but I guess my question to you guys is I think because to your point I think there is an enormous Advantage for building in-game Financial infrastructure so that you can you know better make you have better utility on these nfts that you're playing with or doing or doing whatever do you think that these game ecosystems

are going to be the ones that build them or are they going to leverage uh you know Primitives that are getting built in defy like you know like okay launch on Avalanche C chain all right great is there a decks is there a lending is there lending is there uh like bridging like okay there's none of those things all right sure we gotta go build them like all right I don't have blockchain devs where do I get them do I ask the Avalanche Foundation like those are the conversations that we have a lot of people where it's like the last mile of like infrastructures like things they don't think about what we think are going to kind of like dominate these like C chains and other stuff like that or kind of like these payment for order flow models where like

it's like these super modular dexes that like you know can deploy in the drop of a hat you don't need to vote through you just want V3 governance and see how everyone's feeling it's just like okay cool like there's some payment forward flow model it's based on a cosmos chain that can interoperate with anything and the model we're describing is D flow it's just support Co like obviously like we're biased um but like it's just like this idea that you know you don't need to go through all these hoops and and things like you can just deploy these dexes that are instantly liquid to whatever degree you want on any chain um and I think that's going to be all the wins especially when these games are going across more chains they have their own chains like things are going to start fragmenting and I think that's

going to be a big trend so uh totally agree the the model right now which I still think that we're stuck in in maybe what we call like web 2 Gaming mental models every single game and every single game publisher wants to own their own Marketplace you know they don't want to have like they don't want to integrate with openc they want to have you know Starcraft slash Marketplace or starcraft.com Marketplace and have that be the place where you can transact Starcraft assets and because they you know are in this mental model of owning the IP managing their own assets and maintaining this this basically this ego system you know that is the dominant game model for how you

know places like epic became epic because they just owned everything within and ultimately what that means is it just furthers the point on if you're going to have fragmentation around the user experience of where these assets are transacting and trading hands you're gonna need something like payment for order flow you know the ability to have you know these disjointed marketplaces instead of unified liquidity uh so I I think it does ultimately go back to a protocol that's unified but it's going to look and feel like everything is its own Marketplace in its own ecosystem difficult to predict too for sure um I want to move through a couple other stories here um so there's a stable coin bill that's I guess in in draft right now that's

definitely getting a lot of attention um I guess no one should really be that surprised about this uh after Tara blew up and was Warren basically said this was going to happen but uh I I mean the news just kind of came out this week so yeah give me two seconds my notes are loading here but um all right so basically this is the background which is all right so U.S lawmakers are reportedly drafting a house stablecoin bill and that would take the place that would place a two-year ban on endogenously collateralized stable coins which you know just read algo stable coins uh it also mandates a study on terror-like tokens from the treasury uh and they're working in consultation with the fed the OCC the FDIC and the SEC

it's also the draft is supposed to contain guidance on how even Fiat backed or Fiat pegged Stables should be regulated it would allow both Banks and non-banks to issue The Stables but there's an increased layer of Regulation so for banks you need would need approval from federal Regulators like the OCC if you're a non-bank issuer which I guess that'd be like a circle then you would have to work the if the legislation directs the Federal Reserve is responsible for establishing a process for making application decisions and basically how that would work I'm curious you know yeah I'll just kind of stop there but I'm curious what was your guys take on on this and there's a lot of bills that you proposed not all of them not like 99 of them don't go anywhere

um especially in a time where you know there's like a pretty evenly split divide between the two parties in both the Senate and Congress so like I think that's like the first thing like you know I've seen people say that this is going into effect like at the end of the year it's like we're gonna even see this gets a boat by the year um I do think having some regulation on Staple coins probably makes sense like if you are you know like like one aspect of crypto that I think we should work to like actively reduce is like kind of like the nihilistic you know like super speculative side of it um and it feels like some of like the worst actors in the space for whatever reason are building these like algo stable coins I think there is like a legitimate search for like a

decentralized stable coin but like we probably should have some sort of guardrails around it um and you know that probably isn't like a super popular take but whatever um because I think that's like ultimately the road to like Mass adoption like getting a stable coin where like JP Morgan and Goldman and whoever else can interact with it um like that just is going to onboard so much capital and break so much value and like we're gonna have to sacrifice some ends of the spectrum of like centralization but like I think it's ultimately worth it um do I think this bill is like a good bill no I do I think this bill is going to stay in its current form no um do I think this bill is going to pass probably not um and so like you know you have to keep that all in context but this is where

this is going like it's not going to be this bill but it's probably going to a bill after that with you know some slight language tweaks the industry has some feedback on it like we get to kind of like coalesce on one thing maybe it's on a ban you know maybe it's like you know like a moratorium on like you know some aspects of it but I don't know I I kind of like I see the problems that it creates like things like make your Dao and like the cdps that could potentially be illegal or like obviously not great um but you know a lot of the stable points went to zero um and I think we kind of need to like collectively just be okay with a little bit of Regulation to kind of push the industry meaningfully forward the the nihilism stuff is just not going

to be enough to push it Forward frankly like we just need a different look as an industry that's just aggressively reasonable of you Vance goddamn where's the spicy takes man it's so reasonable um yeah I mean I I feel like a spicy take to people who I generally talk to who are like you know non-developers and some random Eastern European country that are like trying to like you know do interesting things and like push the limits but uh ultimately I don't think like those people are a very important part of the kind of like Rebel Alliance that we have going on um you know like uh like we're the good guys I would say but like you know like I don't think that's our core constituents that right we only have 60 000 daily active addresses on NFD like

we should be broadening the time um not trying to make it more strange and like more you know exclusive I feel like what we should be doing is just yelling at each other on Twitter that feels like the productive thing we already do that [Laughter] yeah um I I agree with you I think I also think um I guess my initial take on this was I I agree that some amount of Regulation is just going to happen whether we like it or not so we might as well make ourselves part of the conversation I view it as a little bit as well of kind of an own goal on on the US if the bill passes in the way that it's currently looks like it's going to pass like come on you know at a point where

you know the dollar is at least being challenged right it's kind of a non-consensus view but it looks like it's at the end of its unquestioned Supremacy you basically get this enormous gift just dumped right in your lap which is an an entirely new technology you know Financial infrastructure and probably the new Big next new big Tech sector wants to adopt your thing for no additional cost all you got to do is not take it out behind the barn and shoot it in the face and they're like back of the Barn's nicest type of year you know like might have to might have to go back behind the barn you know it's just so I I don't know if I necessarily agree with that um I agree with with what you're saying generally uh about you know the

dollarization and the fact that we have the ability to to basically export the dollar at internet speed what I I do think is happening though is you know what the most used stable coin right now usdc yeah we already have this and if there is a bill you know in this form or some other who do you think is going to be one of the biggest benefactors of said bill circle circle so yeah exactly uh you know they're they're going to be able to do whatever they need to do to make sure that usdc stays safe uh and and so I think it you know it's the algorithmic stable coins it's the you know 19 year old developers and they're in their parents basement who are working on something interesting you know they're going to be the ones that get hit uh so

I but but I think you know is this good or is this bad it's good for the us because we're still going to be able to dollarize things it's probably good for consumers because they're not going to be able to you know put money into something that's called literally a stable coin and should maintain stable value and and you know see it go to zero for next week so I I think ultimately some regulation will be good but um yeah it's advances point this thing isn't going to go anywhere um you know we're two months out from an election um and we'll see what happens then but you know you're going to have to have both the Senate in the house to be able to get anything passed uh yeah I would agree with that we should also give a special shout out and appreciation to like the two

organizations that advocate for us you know on Capitol Hill which is coin Center and blockchain Association I feel like every single time there's a bill I see a thread from Jake travinsky and he's like guys nobody freak out we're working on this and everyone just loses at them over in the comments like thank you Jake we appreciate the work that you do man yes um yes thank you here's a question maybe on one hand you've got very Fiat backed heavily collateralized regulated stable coins like usdc and then you've got unco completely uncollateralized algo stable coins but there's this emerging kind of gray space in the middle right like maker kind of sits firmly in between those two camps but then there are also there's like where does this leave something like go

of a stable coin let me let me start and say I don't know if you have any special knowledge that I might not about crypto collateralized stable coins and how that's going to be treated but maybe even from non-regulatory standpoint what do you guys think about these uh you know like curve issuing a stable coin are they issuing a stable coin like how do you what's your view on on uh on those sorts of projects lowers the cost of capital if you're a bar land market UPS your regulatory risk up to or you know visibility on Regulators uh Radars um and so there's trade-offs uh I think generally like the trade-off that we think is like they're making a short

term you know like lower cost of capital like you know better chance of getting traction trade-off for like a longer term like regulatory risk trade-off because it's not clear what the prognosis for stable coins is going to be um and so I think like it's kind of also you know a symptom of the bear Market where like guess what your Berlin platform isn't doing a lot of volume in the bear market so like strap on a stable coin strap one of you know uh the swap you know mechanism like these are the things that you kind of see people just start throwing spaghetti at the wall during these markets just trying to increase their Tam so not surprised that they're doing it either but um like you know like we're we're kind of like fragmenting into like you know uh

regulated Phi or like fincen Phi I saw today I thought that was like kind of funny and also kind of like everything else and it's not necessarily like unregulated D5 it's just like D5 that's International that utilizes the self-custodial and like no middleman model to have distribution and that Playbook is going to work for a number of projects it just probably won't be the largest outcome like if you want to create a trillion dollars of value you need to be welcomed into the regulatory apparatus on on it can be on your own terms but like that's how eth in our opinion is going to be you know like one of the larger assets it's like it's just you know it's grandfathered in a number of ways into the current regulatory environment

and it's made the inroads and it's made the explanations and it's had the conversations with people about like okay there's not going to be an eat stable coin it's like this is the network this is how it exists you know like here it is um and so yeah it's just going to be a bunch of different approaches yeah we uh we I might have told the story on here I can't remember but um we are analysts uh are we're are pretty excited about some of these projects like go and and the curve stable and there was a um a very smart guy but maybe he's a little bit of a Critic of of crypto listening in on the chat and he dm'd me on the Twitter spaces and he's like do you realize your analysts are just describing private banknotes and of

course I was like oh yeah and then I went and looked up what he was talking about and uh and actually if you go back to like the Wildcat era banking in the U.S I mean that's basically what this is right each bank had their own currency that was collateralized by the assets in that bank you know you could argue there there was there was you know everything was regulated on very state-by-state basis of that period of time so maybe that's why it didn't work but it didn't it didn't really work so I get a little nervous when we talk about every project issuing their own stable coin and maybe maybe there's some element of like Empire Building here too which is like the core business isn't really working I've got all these Assets in the treasury which by the way I didn't convert to usdc before that bear Market

whoops and now I gotta do something with it um so maybe there's some element of that as well I mean you'd have to you have to team make if you have your own currency right and and that's what it comes down to uh you know if everybody's transacting with with something that you created like that is that is a massive advantage and you know that's literally the advantage of the United States over every other country in the world right now but you know if you think about it if you're trying to create your own uh you know and it's curve or as Ave or it's any of these platforms uh you know that becomes a huge Advantage for your tour business but also just your brand your recognition everything it's not sure if this matters if if like you know

great you you issued a stable coin uh your own stable coin um now everyone's gaming it's like you know like does this matter are you kind of like you know there's this like saying that like you know sometimes you accidentally fight the last war instead of like the war that you're supposed to be fighting um you know like you know it's like people showing up with horses to World War one uh you know like when there's tanks on the field it's like oh [ __ ] like did we we misjudged this I think you know that's kind of like where this might be going it's like congratulations you have this album uh it's integrated into approximately zero games because you know that's not just not what consumers want and we just need to build for a broader consumer constituency I

think that's where we're going it's not funny at all but can you imagine being the side that shows up in horses and the other side of the stakes like not good not good at all I've made a grave miscalculation this is a very bad idea and like you know in the last war the Cavalry was the best regiment and this one it's like wow oh God yeah I mean these things aren't funny but it's like that is what the bloodiest Wars are when there's like this big advancing in technology and one side gets it and the other one doesn't so precisely yeah um I I've got a bit of a random topic but I actually love uh Vince I saw you or Advanced I saw you Tweeting about this the uh let's call it exploit on avax but basically it's just a very

smart kind of move that one Trader made extracting a whole bunch of value by trading on GMX actually but it was uh Avalanche that was traded so the model that GMX employs is an oracle-based model with zero slippage right so it doesn't matter how big the trade that you take out is it's not going to impact the price ice they took out this enormous position at zero slippage then they went around to other exchanges and actually moved the price and it's essentially extracted an Arbitrage right and uh you can actually look at the price of avax over this really short period of time two hours or something like that it's like it looks like these alligator jaws uh and you know Josh Lim wrote a great threat on this and you know maybe they extracted somewhere

around 750k or something like that maybe minus whatever they're paying to market makers on centralized exchanges but could you just what is your what is I was kind of looking at that being like it's a really smart move that this Trader did but then if the oracle-based model is just pulling from other uh you know mod you know price feeds that rely on you know centralized exchanges then what's is that bad for GMX like moving forward or what's your thoughts on like oracle-based pricing yes bad um also like probably illegal to do this so I I don't think this is like betrayed and it's like okay um so I mean the mechanics of the trade

are pretty simple so uh basically on one side you have this thing that's saying you know here's the price on a centralized exchange but we're only going to update that price you know for every significant movement or every five minutes and like Oracle latency is a key part of this just like don't update very quickly so like you get a stale price you get an old price whatever on the other side you have you know markets and increasingly illiquid markets in the bear Market where like you know you uh basically take out a bunch of size on like the I'll guarantee you this price lag and then you like manipulate the Oracle on the other leg and you know there's a spread that you can capture where like

okay I move the price up you know 10 on the centralized exchange and I got all of my fill on the one price that was quoted and like this isn't just uh something that happens with oracles by the way like this is something that also happens with market makers where like you know if they don't know that you have like a [ __ ] ton of tokens or you know if you're trying to buy a [ __ ] ton of tokens like they'll quote you a price that you know it looks like as if you're gonna buy like only a little bit but if you run them over like that's when the market makers lose money and so like the concept kind of applies not only in D5 it happens in centralized crypto as well I think you know Michael and I have both personally live through this with

synthetics back in the day with like the create one exploit with the maker exploit which is a basically identical to this avax exploit and like the things that synthetics has done to prevent this is reduce the Oracle latency and quote wider spreads in times of higher volatility and they'd basically solve this issue and they don't have a ton of toxic flow anymore um the larger risk of this is like everything is basically more a liquid by a factor of like three to five at the moment than it was like six months ago and so you can do this on like a box is like a top what 30 40 coin like yeah you know like can you do this with a top 20 coin how real these prices in general like that's kind of where my thinking goes um and so yeah it's a dangerous time to

run like a GMX style project because your LPS are just going to get hit um and what and just elaborate exactly how do LPS how are they the losers in this transaction so I mean LPS are the counterparties to these trades right um and so in the synthetics model you're actually staking the native synthetics token and you know if somebody loses money you make money as a Staker and vice versa um the GMX model I'm not as familiar with but it has basically all the similarities to the synthetics model I'm not sure if it's collateralized by GMX or Stables or by the underlying asset itself um actually it would have to be probably GMX or Stables just because like avax

doesn't exist on eth and so like you know their LPS are getting hit one way or the other whether it's collateralized the token or Stables or whatever um it just like is the Oracle model that's the core problem and this doesn't just go away I remember like Michael and I dealing with the synthetics and [ __ ] back in the day just being like we just wish they would stop maybe if we Blacklist that address they'll stop and you know we'll start a new address they'll start a new pair like you know it's just like just this whack-a-mole game that you play so I I think it's the Oracle model but really what the Oracle model means is it's infinite slippage for zero cost that's the issue uh you have to have a slippage based model where if you're trading transacting in in size you have some additional price

impact uh and when you have an oracle-based model it's not you have to add that in after the fact because inherently if you have an oracle model you're just able to transact to whatever the price is you can buy sell at three dollars and it's going to be three dollars even if you're buying ten dollars worth or a million dollars worth but you have to have some slippage-based pricing yeah well tough day for it's Jim I mean I don't know if you've heard anything from the GMX team are they do you think they're kind of looking at this being like oh [ __ ] or I mean I haven't I haven't really heard much communication this is when it gets like I don't know what's gonna happen to GMX but like I remember when this was happening synthetics it was like the most concerning thing ever because you can't

stop the protocol you can't Blacklist yeah it's like oh it's happening again oh no like all right shut that ass and Mark it down oh no they're doing it somewhere else like okay shut that one down and then like towards the end of it I think like remember the front running Saga with synthetics Michael like I think Kane eventually like reimbursed people with like snx tokens or something like it got to be very crazy and it only stopped when we switched to a new model so like this is this is not something that just goes away concerning um speaking of things that are concerning that Segway was better than the one tried last week never gonna do that again I got scarred by that um there was a hack it wouldn't you so

we're gonna meet got hacked for 160 million dollars is a Brute Force vulnerability in their vanity it's like it's more it's a custom address it is actually vanity address but evgeny tweeted out he's like the reason they were doing this using these addresses was not for vanity it wasn't to do something cool it's there's less zeros basically on the address which means that they were saving in terms of a gas cost but basically when are we in and props that props to have Unity props that entire team they're one of the largest most sophisticated market makers and I think all of all of crypto certainly all of defy um so really really great team sucks sucks uh to see that they had this exploit happen to them but basically they lost 160 million dollars due to this they were using

something called profanity which is a it generates vanity addresses and there was a there a one-inch actually flagged that there was a potential exploit there um where you could basically Brute Force right and get your way into that in in the span of 50 days and it seems like um that there was just a human error right on on their side where they actually were aware of this vulnerability but they thought that they blocked it but they but they didn't and they ended up losing 160 million dollars um some of which has found its way into into a curve pool uh I think and a winner mute and the team are Anthony and the team at winter Butte they said that we are open to this being a white hack offering right you keep 10 as a bounty so basically return everything except

for 16 million usdc which I think would be an optimal outcome I'm not sure if there's really a takeaway here other than just it's kind of a mark of how immature things are if you have teams as sophisticated as winter mute uh still suffering these hacks so oh and then I just just to not they are completely solvent and they're you know I it seems like there's absolutely no worries on that front Maples come out into support they still are well capitalized so it's not like these are any contagion concerns it's more of just a sucks I feel badly for them yeah especially people you know just like get hacked for a lot of money and you wake up and you're like should I just send them like a telegram message being like sorry um yeah it just sucks yeah I mean he's like they're so sophisticated but I

think when it's like there's just it always happens on the margins right like you know you're the most sophisticated firm and you have all the best security practices but you're using this one tool to do just one specific thing that opens you up to this one specific vector and like maybe there's a 0.01 chance that someone finds it but like in crypto that's actually like a 50 chance um and so yeah it just sucks and hope they find the money back and you know it finds their way to them but yeah it's it's like it's also like the most seasoned solidity hackers that are doing this and so part of me wonders like how many really seasoned celebrity hackers do we not know of um you know like some of it feels like very close to the industry like an

inside job almost not like from Winter mute but like who knows how to write that level of like sophistication of solidity code probably not that many people um yeah no differentiated takes on my end either but uh yeah it just really sucks and I think the the one takeaway is just the need that we have for better security and I don't know if this means you know more custodial experiences you know more fire blocks type experiences where it's sort of a hybrid but uh you just can't have this much money sitting around um you know in these ecosystems without the level of security that you would expect to be able to protect it yeah have you guys ever heard of a firm

called night capital yes yeah these night capitals one of the craziest and my just heart goes out to every I don't know if these were like good people they were a large very well established super well capitalized very sophisticated basically high frequency trading firm back in 2012 and they essentially vanished in the span of one day they had this algorithm that was running there something was something was wrong with it and they they vaporized over 400 million dollars worth of capital basically in the span of hours it was like 10 million dollars per minute and they figured it out but it was too late and the firm went bankrupt I mean like can you imagine that just one day I uh

brutal brutal yeah not that that's gonna happen to but even 160 million is like dude that's not a small money no and to have your algo misfire and like you lose 400 500 million dollars that's like obviously not good either one of the things that we used to do at Dropbox um when when I was there was uh you go uh code golfing which is what small change could wreck the most possible havoc and in in the entire ecosystem and you would go off and you'd literally find

these bugs and you'd mark them and all this other stuff but literally one of the bugs the the ultimate winner of whoever won dolphin uh found out that there was a plus sign or there was a greater then and if you change it to a less than it would say basically delete all data within Dropbox prior to this date as opposed to after this date you know these types of things exist in very very sophisticated organizations and literally one character change from a greater than to a less than would be you know the end of uh you know at this point a multi-illion dollar company there's another story like that there's a a book that was written about Jim

Simons the founder at um shoot I'm blank you on the night what's that it's like the most successful husband yeah rentac um and they they started off basically it was really long really interesting I mean first of all this guy is a he's basically a mathematical genius like very well regarded in the math community and it was he took a very long slow start to basically the approach that that they would end up uh doing and they brought over uh they they basically had their Algos perfected for like Commodities uh that's what they started with and they were trying to crack equities and there was a really really difficult problem for them and they brought over this guy from IBM who's the crazy kind of right-wing guy who's like the biggest donor yeah um I know who you're talking about I'm in a blank on his name but apparently

this guy is wickedly smart and they're developing this this model and for like years they couldn't crack it couldn't crack it everyone's like Jim buddy it's just not possible with equities you've got to give up on this and this guy's going through the lines of code apparently it was just one letter in the line of code that was the mistake it was just a typo for like why the whole model wasn't working and then they basically fixed it and turned on the greatest money making uh you know algorithm of all time so it's just these crazy like sliding glass drawing moments in history you know could have gone so differently um who knows I've got I got one more this isn't really a bit of news but I wanted to get your guys take on this uh I I dropped it in the in the chat I'm not

sure if you guys had a chance to read it but vitalik published something basically on how Dows should be governed in principles for doubt governance which I thought was interesting and it kind of ties actually back into what we were talking about with stable coins but basically he was writing to paraphrase what he was writing he was writing this this uh blog post in response to another blog post that was written that Dao's should basically borrow lessons from corporate governance in terms of running Dows that was what he was kind of writing this in response to and he made the distinction that Dow governance is better in three different types of situations so convex versus concave decision making uh the decentralization for censorship resistance and

decentralization as credible fairness so to summarize convex decision is basically a situation where it's kind of binary like you rather go in and flip a coin and whichever coin flip ends up being the better thing so military strategy right you can either do a gorilla pincer attack or you can kind of Go full for full force and that's better committing to one of those two things than like trying to split the difference and do both because then you'll lose uh our concave decision is something where you almost do want to split the difference so a judicial a decision so say you Michael are accused of a crime that this Michael committed but you go go to a court right and it's like life in prison uh would you want to split the difference and say hey 50 50 I'll take a you know I'll just take a 50 shot of

that or would you split the difference and and do something more fair so that's convex first concave decision he makes the argument concave decisions better for daos and then there's this the other two are like basically credible neutrality or credible fairness um and then also censorship resistance so a company doesn't have to be censorship resistant in the same way that like a base layer institution kind of like money does and then also same thing for like a sovereign organization versus a corporate organization where in a corporate organization efficiency is really what you want we're trying to generate a return on Capital sovereigns have it have kind of a different thing they have to run the country in a way that seems fair to everyone otherwise people won't buy into the system

I don't I don't I don't know um I guess it really does depend on what your definition of a dow ultimately is I've never just asked you guys that like how do you guys think about Dows in general how are they different from companies how should they behave similarly to companies like what's the value proposition of what these things are in your mind Dallas to me at least are are more of like a board of directors Concepts than like a management concept um I just don't think we've seen many people do the Dows as management team you know school of thought really well and maybe there's like tools that need to be developed and maybe like we'll get there I certainly hold that hope for that but right now it seems to function better is like how I conceptualize

dowels are like you have this big pot of capital and you have you know people who vote on it people who manage it but like the Dow's job is to basically act as a board of directors and allocate Capital to things and I I kind of like the sub-dial model as a result where it's like here's the big pool Capital marketing okay we're sending you know 10 million dollars to that like if you're the unit Swap Grants Foundation okay we're gonna send you know 20 million dollars to the you know policy initiative you know the defy education fund and then like the people in those like sub-dials or corporations that are receiving it like it doesn't need to be a sub to Alchemy also be a corporation it's just like receiving grants go off and execute whatever your functional uh you know player is and I think like that's how I

kind of conceptualize it um and it's also worth noting that like ethereum doesn't have a doubt you know ethereum is is governed in a pretty informal way and it probably has done the best job of achieving long-term results you know uh you know so far and I think that's like pretty indicative that's still kind of like how these things actually work um there's also kind of like this concept with Dao's where you know at the beginning most token projects are extremely closely held and so there isn't like really like a difference between like centralized and decentralized making a decision-making Authority in a de facto sense um and so there is like a little bit of like a gray area on that side um the last part I think is just like okay you have a dow you have a token

um does your does your Dow actually need a token does your project actually need a token like we're definitely kind of like going to the bear Mark Arc where like bear Market Arc where it's like um you know like maybe you don't need token whatever but I think that's like a valid question um you know does your game needed to centralize governance token maybe maybe not um does your chain need that if you have your own chain probably and so like there's different kind of permutations of having tokens and having options and having dowels um that we just haven't explored yet that I think we're going to yeah I mean obviously I think we share a lot of the same perspective on Dows I do think that it's it's maybe not abort I think it's definitely a board of

directors in terms of resource allocation but I think it's more of like a co-op in terms of you know actual work product and you know how people are organizing themselves and you know that is just like inherently less efficient than a corporation and and it will always be just like it'll always be less efficient to have a decentralized distributed Network versus a centralized you know centrally maintained Network you're never going to have resource allocation that's better uh in in both instances and so I think generally you have to think of what's the what's the core Advantage the core Advantage is flexibility you have the ability to work for five different Dows if you want to if you're an artist and you're like uh I kind of I kind of want to create some interesting

artwork and I want to put that together into a bunch of different games well you can work on five different game worlds all at the same time by working for five different Dows and you know that's not something that necessarily it really easily exists or is dominantly existing in the Work World at least in the United States today you know you work for a company and you're you're gainfully employed by that company and that company is your company Etc et cetera so I think the flexibility of work actually is an interesting concept um but you know as we as we did further into the bear Market to Vance's Point uh it just becomes less and less uh activated as as you know the thing that people want to do yeah I'm with you there I think I I do

think you could probably make a pretty credible argument that ethereum and Bitcoin are kind of two of the cleanest definition of doubts right there's like not it's really decentralized uh governance and architecture there and the reason I'm like flagging this is because just something I've been thinking a lot about and I think they're you know to your point about maybe some folks that you talk to that aren't as like pro-regulation for stable coins like you everyone should listen to an interview that roon gave on this podcast called I pledge allegiance and if you kind of hear he's a really smart guy and like built something incredible with maker but like if you listen to his world view and his conception of what maker is some stuff starts to like click and fall into place for me and I think it aligns with vitalik's view here frankly because I

kind of among the stage like like young in my career like I want to contribute to Dallas but I want these things like work I want to like create products here but I think there's a very different perception out there which is to paraphrase rune climate change is coming Western democracies will fall we need to create something that will last beyond that I'm kind of like I don't know I don't know if we're gonna do that uh we should probably try to worry about it then but I don't know I think those are like the two but these are powerful positions right these are powerful these are opinions that people have in very senior places in crypto so you're probably just similarly if you lived in Europe yeah you know it's kind of like a matter of your context and and maybe Europe is

a foreshadowing of what's to come for you know the the us but hopefully not yeah um we got five minutes left you guys want to do meme of the week I've got a meme uh uh let's see a good one I've got a meme all right Michael what's yours I think I know what it is [Laughter] yeah I think I do I don't know if I could pull it up um do you see the ability to share your screen there's like a little thing at the bottom of the I think if I describe it everyone else uh the four the foreshadowing that

vitalik uh uh told everybody uh with with the meme from a few weeks ago his down only Point his body language was telling us something that we were ready to hear it was so obvious at the time yeah tweeted too but you know this is how I felt yesterday [ __ ] why am I watching Bloomberg why am I up you know to watch the FED speed it's just more of like it's become so cultural that you can't even really avoid it at this point like even the Uber drivers and the random guys at the gym are like you know do you see the FED

hike 75 today it's like bro [Laughter] that's super funny what about uh Adam Levine sex like he's a 17 year old have you seen that Adam Levine memes oh God I'm not gonna come down Batman out of America I'm not gonna make a value judgment here all I'm saying is that if anyone's like intimate text got blown up on the national stage woof like that is just a tough position to pay it uh but all right guys I think we can uh I think we can end it there this has been a fun one I think maybe the strongest one we've ever done it's almost like we lost

some dead weight in the uh in the in the Roundup here addiction no you know we're really happy for you buddy enjoy your last few hours of Freedom uh guys most of you here at the same time next week cheers peace foreign [Music]