RAOUL PAL - How Bitcoin Is Eating The World & Why Ethereum Is The Biggest Gamechanger Of All 1/2

RAOUL PAL - How Bitcoin Is Eating The World & Why Ethereum Is The Biggest Gamechanger Of All  1/2

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[Music] we're about to go through the fastest period of technological growth and adoption all recorded human history in the next five to ten years and nobody is prepared for it humans are simple creatures we think in linear terms we can't understand exponentiality it's just not something that suits our brain bitcoin starts the whole process and then everybody realizes this business model of tokens network effects and all of the technological benefits work for almost everything and that's the rise of nfts that's the rise of d5 that's the rise of social tokens that's the rise of so much that's all going on so fast it's hard to keep up i would guess if you speak to most people in the public and say is crypto bigger than the internet even investors they probably say bigger than the internet i mean that's the biggest thing ever the adoption of the internet but it's not right this is like hyper-charged new version of the internet i don't know how big this is going to be but it's a lot bigger than anybody thinks it is when i was in the city back in the late 80s we had something called the big bang where investment banks and commercial banks were allowed to do the same thing again this is that moment there's another big bang but it's the entire architecture of the financial system that's about to happen they all know it's coming and they're all working on it this is a whole different way of looking at things the computers are coming after your job understand that understand multiple streams of income embrace this new future crypto stuff like this there is an opportunity [Music] [Music] the world is changing inspiration is everywhere it has never been so easy to connect share and bring people together we're learning from others and finding the best in ourselves challenging our beliefs [Music] sharing our vulnerability overcoming our fears transforming ourselves so we can transform the world how far can we go this is london real i am brian rose my guest today is [Music] this is london reel i am brian rose my guest today is raul paul the british educator investment strategist broadcaster and entrepreneur in 1997 you became the head of european hedge fund sales at goldman sachs before becoming a portfolio manager at glg partners one of the largest hedge funds in the world then in 2005 at the age of 36 you left the world of mainstream finance to start global macro investor your own advisory publication you first got involved in cryptocurrency by investing in bitcoin in 2012 calling it quote the best trade you've ever found and doubling your money in a month in 2014 you co-founded the financial analysis streaming network real vision with the aim to quote disrupt the whole damn system and change the face of financial media raul welcome to london reel great to be here hey it's great to have you here you know it's going to be a fantastic conversation i can't wait to jump into a bunch of your ideas we both have a background in centralized finance and banking so i think it's going to be really interesting i started banking in new york city back in the 90s in fixed income derivatives i went to chicago i went to london it was in the credit default market for a while but 10 years ago i got jaded i started broadcasting london real but we weren't just doing finance we were doing all sorts of different things but funny enough raul we we dipped our toes into crypto over the years because it was current so i had max kai's here here back in 2013 screaming at the top of his lungs i had uh andreas antonopoulos here in 2015 then he came back in 17 then he came back in 19 raul and he was talking about the internet of money the future you know but we couldn't see it happening yet so it was kind of weird you know it was he was talking about it but it wasn't there yet then last year we got really busy fighting for freedom of speech went head-to-head with youtube this year we ran to be mayor of london and then after all that was over i looked at the defy space and i was like what is going on here i've never seen this rate of innovation this rate of adoption and again i i was in the dot com startup in in new york city as a cfo and i was like i got to be involved in this there's something special happening here and so we just decided to go all in i started uh the defy academy we got hundreds of students going through and just trying to get involved in this market i find it super exciting and i want to get your thoughts on it your video from back in april 30th of this year called raul paul's introduction to the exponential age it's got over a million views and i encourage everybody to watch it because raul i think you were channeling some kind of higher energy on that day i mean like i don't know but for 90 minutes you were flowing and you were dropping some terms i never heard before things like pristine collateral being irresponsibly long crypto being call options on the future and maybe we start with you talking about this exponential age because raul you felt almost like you had surprised yourself like you already knew this market was big but it felt to me like you were saying wow this is maybe even bigger than i thought it was so tell me first of all am i wrong on some of those observations of you and maybe you can walk us through this concept of the exponential age yeah this whole thing the more time i spend on it the whole crypto space and there's a the same is happening with technology at the same time which is what the exponential age thesis is built on is like we're about to go through the fastest period of technological growth and adoption all recorded human history in the next five to ten years and nobody is prepared for it humans are simple creatures we think in linear terms we can't understand exponentiality it's just not something that suits our brains but let me explain what's going on in crypto because that's our focus for today a lot is the internet between 1990 and 2000 grew at it that's the fastest period of growth for the internet because it went from zero or you know from low numbers to larger numbers that period the internet grew at 63 a year was the fastest adoption of any technology in all recorded human history much faster than the mobile phone that came before it and the telephone became forward these are network businesses and i'll come on to that in a bit it's a really important concept so okay how's crypto doing crypto is growing at 113 a year it's the same number of users as the internet had in 97 just before you've decided to leave the world of finance and become and jump headfirst into it people told you oh my god the dot-com crash it was disaster well it wasn't because out of that came facebook amazon google i mean you name it it was the start it wasn't the end so we're growing at 113 a year so this is double the fastest adoption of any technology in all recorded history okay that is exponential growth so we're at about 140 million users as of today of crypto worldwide if you use if you lower the rate of growth to 83 to be slightly conservative you're a billion people by 2024. that's three years it's like okay i can't get my head around this but that's how fast it's growing and it gets you to about three and a half billion by about 2027. so basically you're gonna get to half of the world by the end of this decade so that is truly extraordinary what is that what is this adoption the adoption is a network of money and all of finance in fact it's a network of value that sits above the internet it connects all of this digital world into a way that the value is transfer transferable storable ownable recordable and we'll get onto a lot of this stuff later but this is the world of everything from bitcoin which was really clever why bitcoin was a big breakthrough was because we've developed a new business model that mobile phones have brought and stuff like that these are network models it was in fact a guy called matt carther at metcalfe's law which is you value a network according to the number of users and the kind of interconnectedness they have with each other and that was mobile phone companies if you had all of the mobile phone networks in the world added together right you got a multiple trillion dollar business we just don't think of it that way because it's fragmented then you had the network business models of facebook where they started and google and twitter and read it and you name it they started using behavioral economics combined with this data and creating a network of people that were incentivized to post more share more like more do things more now for us as users of those networks we got the benefit of finding our old school friends and keeping contact with your cousin and all the stuff that we use social networks for the shareholders got rich we didn't in fact they took the economics from us they monetized our idols and our attention then comes bitcoin in 2008. so um and you've got something super powerful because what you've got is a network where the users of the network have bitcoin the value of the network is bitcoin so it becomes a network like no other with all behavioral incentives aligned where everybody is incentivized to grow the network this is why it grows so fast so bitcoin starts the whole process and then everybody realizes this business model of tokens network effects and all of the technological benefits work for almost everything and that's the rise of nfts that's the rise of defy that's the rise of uh social tokens that's the rise of so much that's all going on so fast it's hard to keep up with so that was a long answer to your short question yeah and it's funny because right before i sat down here i wrote myself a question to ask you is this bigger than the internet and funny enough you answered it without me even asking you but i would guess if you speak to most people in the public and say is crypto bigger than the internet even investors they probably say bigger than the internet i mean that's the biggest thing ever the adoption of the internet but it's not right is it bigger than the internet no not in term i don't know they're part they're really the same thing this is like hyper charged new version of the internet but if you think about as investors you can't the internet was something that you had to make the right bet was it going to be oracle was it going to be juniper you know who was the right player how did you make the money it wasn't as easy this is actually pretty easy in many respects because a you've got bitcoin which is a monetary network you've got ethereum which is basically a platform for all of this and then you've got a bunch of other things that you can invest in but the whole space is moving in size and it's much easier investable than let's say the nasdaq was in the past you didn't quite capture the value of the internet because this is global you know when you bought you know juniper networks back in 2000 that was a u.s firm yes it was global but you weren't capturing the global value of the internet you have to go and buy a share in all of the incentives here one thing fits all and it's it is amazing and it yeah i don't know how big this is going to be but it's a lot bigger than anybody thinks it is i would literally immediately and it's it'll be the biggest thing in the past hundred years and maybe the next 100 years this point in time for the next 10 years like you're saying as we go up and make three and a billion probably you can conservatively say that it'll be the biggest most exponentially growing thing we'll ever see and that is happening at the same time as ai goes mainstream exponentially robotics goes mainstream exponentially autonomous vehicles ev technology genetic sciences um distributed computing power all of these things 5g technology or space wi-fi are all happening at the same time and they all are connected and then all driven by networks so it's kind of hold on to your hat humanity's not dealt with anything like this before and it's not going to be easy you see it all over social media there's a fear of the future from some because their value system's changing you know it was gold and value investing it was bonds and it was you know that's what i know and that's what i'm comfortable with somebody's telling me this internet money is the future of everything i i don't want to know you know and then it's it becomes anger and resentment and it's i don't think that's going to go away for a while i think people are going to be a little bit it's going to be very unsettling this whole period but incredibly rewarding yeah i mean you have a background in centralized finance you worked in a bank i worked in a bank and you know maybe we just talked about this right now i mean i got a text message from that west last week that said to protect you and your money we're going to restrict you from being allowed credit and debit payments to binance and i thought well that's very nice of you you've never sent me a text like that in the past um and that was an interesting reaction to a centralized financial institution to this world of defy what what do you see the banks doing i'm sure you still know lots of people inside the banking world do you see them as just part of the innovator's dilemma this is something that always happens in disruption do you think they're going to hold on much more much longer because they're kind of ingrained in the whole government and financial system do you look at him as the bad guy the good guy or is this just a process there's a lot at stake a lot a lot at stake yeah i don't think nat west having worked there in the past they're not brave enough to make this decision what they're terrified of is the regulator coming after them they have no they're not thinking yet of binance as a competitor we need to stop them so i don't think that's happening i think what is happening is the regulators are far behind we know they want to regulate but we don't know how and nobody wants retroactive fines all the banks are fed up with that because they've been paying fines since 2008 and that hasn't stopped so they're terrified the regulators are terrified because there is a lot at stake because suddenly there is a decentralized financial system that is probably broader than finance alone it's the value of money the value it's the internet of value and they don't know what to do how on earth do you regulate it when you have things like dowels and decentralized exchanges that don't exist what do you do all you can regulate is your on-ramps and off-ramps so they need to figure that out fast and the central bank digital currencies is their answer to this because then you know what connects with what right now if not it's too difficult for them so everybody's scared the regulators know where the world is going i believe i don't think they're stupid and i don't think they're going to stop it i think they just want to slow it down so they get a chance because what are governments actually interested in they're interested in taxes and that's what even what kyc aml is about too it's really just tax collection you know a smaller black market economy bigger tax collection and having just gone through this period of excessive government spending over the pandemic and beforehand for the last decade and a bit um they need to raise taxes so they just want it within their web they don't want to lose the power of currency themselves which is what the central bank digital currency's doing is trying to stop them losing currency but they're probably gonna have to share it and they're gonna have to share power and this world is gonna evolve outside of their sphere of influence and there's not a lot they can do about it so i think there is the this the dilemma is everybody knows they're being disrupted including the bis the imf the ecb all the central banks all of the main governments they they're not stupid and they don't really know what to do there is a sense of arrogance which you know all of us in the crypto markets shows sees as their sign of weakness is the arrogance is the non-acceptance of what is really going on and that usually means they'll probably move too late because they're still trying to regulate you know the simple things like exchanges meanwhile defense exploded and then they get on to d5 in four years time and nfts are now the biggest thing in the world there's no way they can deal with this pace of innovation the sheer number of people at a entrepreneurial level that are involved in this is like nothing i've ever seen before it's more than i saw with the internet um so it's huge now to go back to the question about okay what are my colleagues in the investment banking world well that's entirely different the investment banks smell money and they want to control the flow of it not in terms of centralizing money but there's money to be made from their customers who want access to it so they too are scared of the regulators but they're pushing forward faster so goldman has trading and derivatives in this stuff jp morgan everything else and they're all moving this way because they know it's coming they also know in the end and the regulators know that everything is about to be tokenized the entire industry because you get t-zero settlements instantaneous settlements of any transaction for any financial instrument in the world if you tokenize it the question is what blockchain does it go on and the answer is it's not going to be a centralized blockchain because they can't innovate fast enough because nobody can hire enough developers so it's going to go to the private sector like we saw the european investment bank launched a bond on an ethereum to test so there is this world we don't know what it's going to look like but it's like when i was in the city back in the uh late 80s we had something called the big bang where investment banks and commercial banks were allowed to be the same thing again and this is that moment there's another big bang but it's the entire architecture of the financial system that's about to happen they all know it's coming um and they're all working on it yeah and like you said if the customers keep calling and if they want the exposure you know you're your best banker at goldman and and jp morgan i mean they're going to find a way to get them access they're going to find a way to do it they're going to find a way to make money but then there's this whole issue of regulation do you think that there will be a point where a government whether the u.s government or bank of

england or someone else is able to slow down the pace of growth you know to just pull a massive restriction or do you think that this really is unstoppable that it won't be able to pull it back 30 well china's kind of doing it now you know until they get their stuff sorted out with their central bank digital currency again i don't think their intent is to get rid of bitcoin it's to clean it up they've got wild speculation going on they they've already they've got a problem with their private sector shadow lending markets anyway and crypto's being used for it also they've got a problem with money going offshore so they're just trying to just say right stop everybody we we want to get this organized so we can deal with it i think we will see that periodically um you know we haven't seen it in d5 but that's coming you know doesn't because there's no disclosure of risks and stuff like that now the question is i saw gary gensler yesterday the new head of the sec talking about risk and i'm struggling to see why we understand there's a lot of scams in the space and things need to be there needs to be a hurdle but why should somebody restrict somebody from the opportunity to make money you know in the us you have this term accredited investor so i'm a credited investor so i get to do anything i want to make as much money as i want and lose as much money as i want but somebody else is not allowed to so you're perpetuating the 99 versus the one percent even though you're trying to do the right thing we need to change this now we've seen some of the rules on crowdfunding change we've seen some of the rules on who can invest in startups most cryptocurrencies are basically real-time mark-to-market venture capital bets we just need to teach people how to take risk not stop them taking risk and humans are gamblers if they want to gamble they will gamble they'll gamble on the horses they'll gamble on the football gamble on anything so if you think that by regulating who can invest in cryptocurrencies you're not going to stop gambling you're going to stop gambling crypto just go somewhere else it's ludicrous so they need a better understanding really of what is going on and it's hard because it's engaging young people at scale yeah it's a fascinating observation and you can see it in the volatility you can see it and the people involved in this market like you said they they're getting access to risk that used to be held for accredited investors but why was it held for accredited investors and that's one thing i see that with that you're doing well you're so passionate about the financial education and i think you once said bitcoin is the best chance for the median person to radically expand their economic horizons and it's an interesting concept just by trading crypto you learn more about money or you get more comfortable about money than probably you ever have in your life and we're taught from kids that you're not smart enough to manage your money that's what the fund managers do that's what these people do and this is a way to have a real relationship with your money in a way where a conspiracy theorist would say okay the governments the banks don't want you to but regardless of the motivations it's been something that's been missing in the past but but crypto changes all that right it really does and also think about it i i try and think of the world in different people's eyes and let's say you're the typical millennial kid who's now 32 years old i think the average age so you're just starting to come into peak earnings you've got no savings you've still got your student debt you're trying to get rid of and then you look at real estate so look at traditional investments so what are investments investments are basically future consumption you buy something now you hope to sell it at a higher price to give you consumption in the future right when you retire or whatever it is right that's what an asset is to us in the investment world so what assets do they have they have the equity market all-time record high valuations they have the bond market all-time record high valuations they have the um real estate market all-time record high valuations so traditional assets to them they're buying very expensively now if you look at the size of those markets equities bonds and real estate on a global basis like globe real estate's about 100 trillion dollars global equities global bonds they're all like the 200 trillion dollar market and then you've got crypto the fastest adoption technology in all recorded history which is the internet of money where all of these things are going to be tokenized and will be part of this won't all be bitcoin bitcoin is one of the expressions of this so that space is currently about one and a half trillion dollars today so for it to meet somewhere around the equity bond market size that's a hundred x from here if it actually absorbs all of those markets well that's a 500x so 100x you me nobody in history anybody has ever been given a whole asset class an entire asset class that can go up 100x to a hut to 200 trillion dollars so and it fractionalizes so it doesn't matter whether you earn twenty thousand pounds a year or you earn two hundred thousand pounds a year you can both put 10 of your income in it because it's fractional so now you're on the same playing field okay that gets interesting so we can all have the same percentage in bitcoin but then it's going to get more interesting because like if you've got a um an apartment in number one hyde park that thing costs 200 million pounds out of all of our reach but the guy who owns it probably bought it for a hundred million it's about 100 100 million but we can't and you know the average apartment you know in the outskirts of london hasn't gone up as much so how do we make the money well we're going to tokenize real estate too because then maybe out of one of those fancy buildings one of those apartments gets tokenized so you can put in 10 of your net worth into it and i can put in 5 of my net worth and somebody else can put in 50 of their net worth and because it's fractional and it's tokenized we all get to participate without it just being the rich get richer fascinating so there's a lot coming and so those millennials are looking even if they don't have a financial background they look in it like you said these other asset classes and they all seem at their peak and then they see something that potentially could grow 100x to 500x and they have access to it and it's native on social media there is crowd sourcing of information the quality of information that's out there yes there's a lot of noise but the quality of information the people who are trying to help in this space on twitter on reddit and all of these forums is extraordinary even on tiktok so people are trying to help you because of network effects means if you bring more people into network it goes up in value and also people passionately believe in the point of this thing so it is engaging young people because also all of those millennials grew up in 9 11 2008 and now the pandemic they have no trust in institutions they trust institutions implicitly in some ways but finance is the big one that they don't because their parents lost their houses and jobs and so when you're seeing an opportunity that is social media in nature that's native to the internet that they understand and live in that offers them huge potential reward and they can stick it to the man well kind of gets interesting right and then that's probably why you see this exponential option on the back of it and the way you kind of open this broadcast out with that incredible explanation where yeah you had facebook and you had this whole information people layer here but you never had the value layer and you never had a value layer that was peer-to-peer and controlled by that peer group which then leads to the adoption and the growth and it's an incredible way of visualizing what's happening here and i worry i i'm in a bubble here raul that i keep talking to people like you and michael saylor and you know ceos of ave and charles hoskinson and everyone's telling me this but when you say it it just seems so clear well i go and have to head check myself right because we're all in this space we can get each other fired up but i just use that adoption curve right if if networks are valued in a certain way then let's just go back to first principles okay how is this network growing what is going to derail that is bad news about tether going to derail that highly unlikely is regulation gonna slow it down well i think regulation speeds up adoption because then that west won't be saying oh don't use finance they're like okay fine you do what you want here's the rules so it's very difficult to find a world where adoption goes down um and at this pace of adoption it feels very difficult indeed so i'm just trying to first principles keep out of all of this because everything sounds amazing and we don't know what's going to go to zero and what's going to go exponential but generally it's that network adoption model that's that's the truth yeah that's such a great point and a great way to ground yourself whenever you feel like you're in the echo chamber go back to the first principles and just look at the order look at that growth and say okay i can't argue against this at all another one the other easy one for people who don't really know how to do that is you know there's free charting platforms like trading view you can just chart a log chart all exponential assets basically look like a beautiful trend channel in a log chart so facebook looks like this google looks like this apple looks like this well actually when you're creating the log chart there's this lovely linear trend log trend and bitcoin is the same and if that changes you know that log trend from from 2010 till current day if that changes then you can reassess if not the ups and downs the noise all of the screaming and shouting on social media forget about it just follow that chart right okay and that's that logarithmic graph that you're looking at with the log chart um i encourage everyone to look at that one of the things you talked about in this in this black hole video um was ethereum versus bitcoin and again it was fascinating to watch you almost realizing this while you were saying and showing it and you were looking at again you talked about metcalfe's law you talked about all these data points and what ethereum brought to the table and how you were just more and more convinced that this quote-unquote flipping would happen or ethereum would long-term surpass bitcoin or at least there was massive value in this network and maybe you can talk a little bit about that you know i've been re-watching my interviews with andreas antonopoulos from 2015 17 and 19. he's basically describing ethereum before ethereum really had the traction and he's describing this whole potential future of smart contracts and these things but it it hadn't really happened yet and then we see it happen tell me what you were describing in that video and what you see and your thoughts on btc versus eth so it started you know i've been involved in bitcoins first 2012-13 and i get the value proposition i get what it is it's it's perfection as an asset and it's store of value and yes it's still too volatile to be a store of value but it's compensated by the fact it goes up a lot so you know we don't mind uh we have to accept the volatility but then you know i was starting to become aware of smart contracts in about 2015 um as some friends of mine started talking about it i don't really understand what that was but but when they explained i started realizing the future of everything from insurance contracts to legal documents to anything could now go on a blockchain and that meant for me also with my finance background okay that means all derivative contracts which are complicated and messy and we knew it when lehman blew up nobody knows who owns what so i'm thinking wow okay that's all the finance probably there's custody and there's clearing and there's okay these are a lot of things um and so i reinvested in the space um i sold out in 2017 too early um i then um bought again in 2020 because the macro and crypto come to this point where that was like marriage made in heaven the chart pattern was perfect the government's going to print massive amounts of money the financial system has got to be under massive strain and bitcoin is going to come the shining light and that's exactly how it played out so i was heavily invested in fact 100 of my liquid net worth in this which is why irresponsibly long was the was the terminology although i didn't use leverage so it wasn't that irresponsible i've got income and other stuff but but anyway so it was quite a lot you're you're all in you really are all in i'm all in um and then i started looking at the chart because i love a chart of ethereum versus bitcoin and i'm thinking this looks like it's basing this looks like it's going to break out and this i do a lot of my macro thinking i start with a chart think huh why is it telling me that so then i start doing work about okay well we know we kind of think we know how to value bitcoin because we're using the stock to flow model that plan b has and we're doing all this stuff maybe it's something else too maybe it's network effects so i start talking to people thinking it through and i start looking at bitcoin in network effect terps and it works metcalfe's law so i thought huh wonder if ethereum works because everyone tells me oh well you don't want to you know you don't want to touch ethereum you know it's a scam it's a coin it's going to underperform i'm like once you tell me something like that i'm going to look at it you know if it's something serious so i did the work and it's like not only is it a getting faster adoption than bitcoin it's working perfectly in terms of price with netcast law and it is almost mirroring bitcoin back in 2017 with the kind of lag by the number of years except the network's going faster then i looked at the quality of the network like the amount of connections and you see that people on ethereum have built all of these applications which is all of d5 all of nfts other uses of smart contracts we've got central banks using it for the european investment bank putting bonds onto it we've got people wrapping bitcoin on it people are wrapping securities on it and you're like okay this is the platform for now things can change its adoption is twice the speed of bitcoin just to get everybody's heads around it i mean so the probability of ethereum going up dramatically in price because of that alone is very high then cuts it tomorrow so after this interview this interview once everybody sees it we'll have will have implemented eip 1559. what that basically does is ethereum got quite expensive to use because gas fees well what they're going to do with fees is they're going to start burning ethereum which is basically like a share buyback which makes it rarer so the issuance rate probably goes from four percent a year to we don't know but let's take two percent okay and then we've got another thing coming in ethereum which is ether 2.0 which is moving to proof of stake and what's very nice about that is we all get record rewarded by staking our eth so we get through this 1559 probably everybody ends up staking the eth because the price is going to start rising and so everyone locks away so there's a bunch of ethereum get locked away there's a bunch of us who are also holders who've stuck it in our cold wallets and then there's all of defy which is locking away billions and billions of tens of billions of dollars of ethereum so when you look at the analysis the on-chain analysis the free float of ethereum going into this is 13 and it's falling every day and as this price starts rallying which is doing pretty well and starts approaching the new highs again a everybody's going to stake their wreath because why not b if not you're not going to keep it on exchange because it's going up in value so you tend to put it in a cold storage and so this there's no supply and you're burning each every day so you're so so the supply keeps going down and the network effect that i've been talking about means that the demand is going up exponentially so a limited supply asset that is becoming more limited with a backdrop of exponential increasing demand can only equal exponential price rises and your view on this hasn't wavered much in the past say six months not at all not at all right and yeah and with this latest initiative as well it just like you said gives even more and more reasons and some of the complaints about ethereum about it being inflationary it addresses all of those and like you said with the stake we've never really seen that effect happen and it could be big um you know i wrote i wrote this up for global macro investor my kind of institutional research service and i just titled it the greatest trade in the world and i think the opportunity in eth is better than the opportunity in bitcoin in march 2020. wow that being said you still own bitcoin yes okay you still have it as part of that portfolio correct but it's just it's a lesser part your most heavily weighted ethereum yeah i think 55 percent each 25 bitcoin then i've got a basket of everything from d5 protocols to um other big protocols like polkadot interoperability stuff equally weighted because i don't really know and i'm just not smart enough to figure it all out and then i got a bit of a macro bet in metaverse and community tokens but again small it's really everything's really an ethereum bitcoin bet for me still okay look while we're here now let's talk about a couple of those things you mentioned and the only thing that maybe we can see competing if you will with ethereum obviously cardone is the big wild card making some moves in the next couple months we got charles here i think about four weeks from today we've got like you said dot it's a lot of these kind of interchange pieces we've got these second layer solutions like polygon but if you look at coin market cap there's not a lot of other things happening except for d5 protocols up there that i can see there's some great apps unit swap and ave and things like that what do you see in those other competitors if you will i don't and i don't know is the answer but i need to have an open mind because this space is too close-minded the space is because you're rewarded to be tribal and back the only one true thing true asset as investors we need to be careful of that bias so i don't know so some very smart people that i know say listen you know polkadot is a really serious project and this could do this you know bilecoin or you know there's a bunch of things that become the people say listen you don't really understand the use case yet um and probably in three years time we'll be talking more about it so i kind of so yeah okay i'll keep an open mind i have an open enough mind that i've i even own doge and the reason being is simply put if the world is net is network effects you've got a lot of retail owners but there's no network because it's not being used but then you've got elon musk telling you hey i want to build on this why well because he's got all these users right he can now raise infinite capital if he becomes you know the core side the other side of the network equation mark cuban started accepting doge because he realized it's a social thing people know it's kind of fun but it also has worked so he started accepting at dallas maps for ticket sales and merch and stuff like that so now you might end up building a network so again i keep an open mind to all of this people are too quick to say this is never going to make it like kadana right there's a huge fight in the community you know kidano and his smart contracts and you know is it going to amount to anything is it going to amount to nothing i don't know and that's okay and we should all be a little bit more comfortable saying i don't know it's pretty interesting let's see how it goes i can place a small bet and i can't like a place a big bet yet because i don't know enough maybe you're really in the space and you know inside out and you think yeah you know what i can see what's coming down the pipe on the plan i think this is gonna work i can take a bigger bet that's okay too but you know i can't because i don't know i just don't have the bandwidth to take all this in yeah that is the thing is bandwidth i mean one of the things i'm getting all my students to do is we have a thing called a 10 coin rule you're not allowed to own more than 10 coins at least for your first year of investing that's probably too many because there's so many stories there's so many rabbit holes but that there's also seems like a finite number of potential players and like you said with cardano it's interesting because it's been a long time in the works it's a long-term plan um but it's a it's a call option on something that could be big and there's not many places that are putting that much effort into that piece so i guess it's a kind of watch and to be continued yeah i mean there's the other one that came out that it's going to take a while to sort this one out and i don't know which way it's going to go but you shouldn't write it off is dfinity or the internet computer so unfortunately it was backed heavily by vcs early on the people who were allowed liquidity on launch had made tens of thousands of percent and so retail got pretty burnt into that equation that was ugly and not good and not honorable i've got several friends invested in it and they're all locked up still but there's a bunch that weren't so that was not good what those guys have built i don't even understand i can't you know i've interviewed um them i don't really know but i kind of figure it's big it's kind of like you know when we first spoke to charles hoskinson on real vision 2016-15 you know it was the same it's like yeah it sounds pretty big i don't know uh and definities you know it fell 90 something percent you know is that a small call option on something could it be worth zero possibly um i don't know we just have to keep our eye because you know even though the adoption is exponential each token has to go through its adoption curve or failure um and we we don't you know that takes a bit more time than we think while we see the whole space doing this it's really driven by currently it's really driven by bitcoin ethereum and d5 the other protocols it's going to take more time yeah but and it's interesting how i like how you are honest enough to say i don't know exactly what they're doing but all great tech investors from the past never really knew what the company was doing i mean did anybody really know what facebook or google were doing in the beginning they they knew they probably passed the first principles oh you're doing this this listen to peter thiel it's a social network they're using their real names i'm in you know there's little things but there's a lot you'll never know and if you try to figure it all out it's too late usually so um i like how you're thinking of these markets as it might have the potential let's keep a small bit but keep the core positions i want to talk to you about the metaverse and your community ip because this makes you very unique raul you really have a passionate way of understanding and looking at the communities which i think you believe is is is everything really going forward and how the future is these communities you've you've touched on it while we've been talking now you mentioned doge you mentioned kind of the facebook but then the value over here you mentioned since it's peer-to-peer and people own it you mentioned some of the passion behind some of these coins talk to me about community it's such a general word i don't know if anyone understands it if you've had a community you kind of understand it but it's also it also slips through your fingers too doesn't it because it's it it does what did the internet do for you and i we would have grown up in a town where we knew a lot of the people and then you go to to continue watching the rest of the episode for free visit our website londonreel.tv or click the link in the description below [Music] wow

2021-08-21 02:47

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