Just a quick heads up and you probably already know this. If you follow me on Twitter, I am pretty deep
down the rabbit hole
when it comes to the crazy world of n FTS, but you might not know that I have a brand new
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on proof. We interview in Ft artist. These can be both up-and-coming and Industry icons. We also cover the generative art scene, the nft gaming / metaverse, and Founders that are building new tools for creators and collectors.
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Hello friends, welcome to the modern finance and proof consensus. This is the show that covers all the latest in
ft and crypto news today. I'm joined by the one and only aftab AKA DC investor at. I am DC investor on Twitter off. Top
welcome. Hey, Kevin, thanks for having me back on. I'm excited to chat with you again today,
dude. I always have so much fun when we jump into this stuff because you you and I think we have we have a lot of overlap.
Put them, we have some stuff that, you know, neither of us knows. And I feel like I always learned something and it's fun to hash out and debate, some of the stuff as well.
Yeah, likewise. I always appreciate your perspective. Kevin awesome. So I figured we divide this show into two parts because
obviously, it's funny. I don't know if you get this pushback to but some people are like, give me more in Ft stuff. And some people are like, I've had enough energy stuff, like,
Demi Moore crypto talk. There seems to be two
camps. So I figured up front the
First half the show, we talked about empties second half of the show and I can put a marker in the show notes. Letting people know if they're like, hey, I'm not in empties. They going to jump just directly to the back half of the show. We're going to be talking about the Solana outage and Arbitron launch and Robin Hood's new crypto app lot of stuff to cover their as well. So if that's cool with you, that's the way we'll do it. Let's do it.
All right, you have the first topic you want to kick it off. Sure. And you know, I've seen some comments from folks on Twitter and really the past couple of weeks.
And they're from people who have had their nft stolen and their other assets from various blockchains. A lot of them are on a theory. Mm. And I think it's important just to remind people on how to keep these assets secure and I think if you first of all until you learn how to keep these assets secure, I recommend even not participating in the space because I think it's important to understand how these Technologies work. And well, I would say, I would offer a caveat where if you're dealing with a very small dollar amount and you just want to get started.
Arted. It's fine to use a hot wall in meta mask for like very small dollar amounts where if the entire contents of that wallet were to be lost. You wouldn't necessarily be financially harm, but a lot of people have purchased in a tease or ether other Assets in the value of them has gone up by quite a bit. Yes, couple of weeks and months and all of a sudden what she thought was just a random by is now worth a lot of money for those people. I really recommend that you purchase what is called a hardware wallet. I think most people know what this is, but this is basically like a
Small USB key size device, which is basically a small little computer and on that computer is stored a private key and that private key also known as like your seed words, your secret passphrase. And so on that is basically the keys to your account. If someone else were to get a copy of those words or that passphrase, they basically control your account to. Yeah, you know, you could, you it's I don't even think of it as theft necessary. At that point. It's like they are now a co-owner because they
Have access to those words, so you really need to safeguard those words in a very serious way. So the value of a hardware while it is those words get initialized on that device. You write them down and they the words are never directly communicated to your computer, which is connected to the internet in most cases. Right? And so that's why it's important to use this kind of device. But the other really important thing is that I've seen a lot of scams that are getting more sophisticated is they'll try to trick you into entering those words on a website.
And so let me be clear. If any webpage is asking you to enter in your private key, or if meta, mask is asking you to enter it in after initial setup. You're probably being scammed and you need to stop what you're doing right now. And these scams are incredibly prevalent. I've seen them multiple times just in doing my course of business. I'm able to identify them. A lot of other people might not be able to in one final comment on these the secret passphrase or seed words. Is that once you have them initialized on your Hardware wallet.
Do not go and enter them even into meta mask on your computer. Because then you defeated the purpose of the hardware wallet and metal mask will, in some cases take those same seed words and allow you to access the same account. But the point is you want to keep them segregated in that offline device. So this
right. You have the one thing that really freaked me out in the last few days is I saw there was a Twitter post about someone that said they were receiving in ft's as gifts
which if you get enough
entities in your account and especially
The, the kind of high-dollar in of tease other people out there will say, hey, I want to make this person aware of my project and so they gift you free in Ft. So every single day, my account receives probably three to four free and of teas. And most of them are completely worthless, so don't think this is like, go Kevin's, making a ton of money off this. Like we get random. I'm sure you get this as well, right. Just like random stuff hitting your account. Well, there was a post by someone. Did you see this? Where they said they had just interacted with one of these gifted.
Identities. And then they lost some other in a few, they were stolen from their
account. Did you see that post? I did see that and I'm not sure exactly what happened there. Kevin. But, you know, here's what I'll say about that. Exploit is one in general. It's a good idea. Not to interact with assets that you don't recognize in your account. I mean, I get tons of the spam. Some people want to make it look like I've collected certain and ft's I just ignore a hundred percent of them. You had it. I I haven't gone through that process on open sea, but I probably will
At some point, they're just something that I don't pay attention to. It's like I typically will have my gallery and gallery. Not a. So anyway, so it doesn't really matter to me. And I encourage most people to just take that approach. Because why are you even want to spend the gas to get rid of something from your wallet in a situation like that? But I think in that case, just the exploit that occurred. I think what the the the hypothesis is that, that person stored those private keys on their computer and it was actually the private key that was compromised. Not necessarily the fact that they
Do with the dodgy and of TSA. So that's just something to keep in mind.
Yeah. I just don't want, kind of freaked me out because initially when I saw it, the in my mind, there was no real way to pull that off. Like, if you think about it, the act of going on to open sea, selecting some random entities that you did not, you know, you use self purchase and just choosing. The hide feature is just, you're just signing the message when you're going into open sea, and then you're executing some JavaScript to tell the backend servers just to hide those, right? So I wouldn't imagine
In that, that could be exploitable in any way unless Open Sea had been compromised.
So, I didn't see
a real exploit here. It did freak me out for a minute. I'm like, okay. Well, until people get to the bottom, this I'm just not going to use Open Sea because I thought maybe there is an ActiveX played in Open Sea. That I'm just not aware of but I haven't seen anything that that says that that is actually the case.
Yeah, and I've talked to some developer types who basically say that there's not really a true exploit path for what happened there. And if you actually look at the, the transactions that were signed by
By that wallet. It was done by someone who had access to the private key. So I think what's very likely is this person had a copy of the sheet word storage somewhere, unencrypted on their computer or worse in the cloud, which people do right? And people gain access to those cloud storage accounts. And this is now becoming a very common attack vector. And maybe like three years ago. If someone saw 12 random words in a text file, they wouldn't know what it is. Now, everyone knows what it is. So I think it's important that people are just really cautious and Vigilant.
Yeah.
Absolutely, and I think a hardware wallet is a good suggestion. A couple things there, I think, worth mentioning in the hardware wallet side, you know, I have tried a bunch of them out there, the two big players in the space or trouser and Ledger. Obviously, and I would say that, I love love, love, love
of treasures, like, just really
beautiful awesome interface. It works so well for cryptocurrency. It sucks for NF T's. Like, you have no idea what you're doing when you're doing a transfer and it's like your site.
Or like a proving something. And there's just a bunch of numbers on the screen. Same more or less goes for Ledger. I did talk to someone over at that runs product over at Ledger and and I also chat with the co-founder. They are making in at, he's a first-class citizen. So that is coming very soon. You will see a lot of the UI and the interface dedicated to understanding what you're transferring on the nft front, but they're
even with the hardware
wallets. They are confusing. Am I missing anything or there any other way?
That you've Hardware walls that you've checked out or are those the two that you stand by?
I mean, I think that those are two, those are the two that are the best for most people. And there's also grid plus has their own Hardware wallet, which is a little bit more sophisticated. But is based on access cards and gives you more information on your contract interactions. I think a huge limitation of any of these wallets though is just your ability and even I, as like an experienced operator, and you, when we look at these string saying like what you're doing, it can be hard to tell what's going on.
And exactly what you're approving. So you always need to make sure you like on the right website. You always need to kind of double-check the address. That's there to the extent that you can interpret that contract data. Make sure you do it. It's really easy to get sloppy and kind of lose everything. And I think it's important to remember to a very large extent. We're still in the wild west of this technology. I think it's going to get like exponentially easier to use in the next two to three years, but right now is still like a tricky time. Yeah. To two questions for you one.
Grid. Plus I have a unit
On them. I just received I'm going to start playing with it. I like that. It's manufactured in Texas and apparently in all us team and I'm not trying to slight any other countries like, you know, Ledger's are made in France. It's awesome and kept member, we're Treasures are made but I am a little scared of these unknown startups and in you know that are coming out of China and I just am not sure about the chips and I want to make sure that everything is secure
their. Do, you know the grid plus team at all? I do know some members of the group Quest team.
Mm, and I have a lot of confidence and kind of the types of products that they're working to develop and I also have one of the units that I'm going to be setting up here within the next week or two, but I think it's just a great option because it's it is it is to stepping up some of that security and it's making it a little bit more full-featured. So I do think it's a great option that more advanced users can consider. I'm going to have the
CEO, Arma, try and get to see you on the show because I think I want to do with any of these things, you know, part of the reason why I had the head of risk for for Block Phi.
And also for Gemini is I wanted to make sure that the lending stuff was Secure on the back end and this is one of those things where I actually want to talk to a human, you know, like who's behind this project that kind of freaks me out. So I'll do that. I also heard rumors that coinbase their custody service which is used for institutional assets. Currently not really consumer product is going to be offering an FTE storage. Would you ever trust a coin base with holding your in FTS?
I might and I might consider a custody solution for some of my NXT.
At some point, it's not a bridge that I've crossed yet, but it is something that I'm seriously thinking about, I think, same general, I think, in general, some of these custody services will become more accessible and more mainstream. So that people will be able to interact with various apps through a custody provider. And I'm actually surprised it's taken this long for those kinds of products to reach mainstream. So, I don't know if there's regulatory issues or certain liability issues, but I think eventually we'll work through those. I think the other thing to keep an eye on is
What are called smart contract wallets and as especially as aetherium, moves more towards the layer 2 architecture. We will eventually be able to see us use Smart contract while it's where you don't necessarily need to safeguard a private key. But you instead name designated contacts, who can help you restore your account in the event of a loss. So I think architectures like that or probably closer to what the future will look like.
Yeah. I agree. It treasure has a really beautiful solution there. I'm blanking on the name, but they
Actually give you the ability to divide up your secret key in a number of different like print out. So you can say, I want to print out eight different pages that I want to can to eight different friends. And then you set the number of different the printouts in the special words on that page that are required to restore your secret Keys. You can say actually I need four of the eight to provide me the paperback or three of the eight or whatever you decide and then if you get those papers back from those people, you know, they're supposedly, storing them in a safe place. Then you can restore the entire wall, which is
Be cool. Midi gear secret phrase back, but none of them can do it. Independently in this, they were in cahoots and worked with each other. But yes, Solutions, like that are really interesting.
So loot. Loot loot
has been crazy. Do you own any loot? And if these
I don't but I think it's a really interesting project and I'll give folks just like a quick
overview of what it is. But
basically this this was released by Dom who has I believe the founder of Vine which was kind of like a short video Network that was around for a while.
And Lou, yeah, I think there are eight thousand in total and they were basically given away for free and if you look at the loot nft any lewd nft, it's like a series of eight. Like then they basically read like RPG items and so they'll be like Divine Hood, hard leather armor, hard, leather belt and if you've ever played an RPG, you kind of have a feeling for what I'm talking about. And there's nothing else that's necessarily provided with, it's okay. It's just those words, right? The metadata associated with that.
And so the real question is like, so, and I'm basically said, look this, we're just putting this out there into the community. Now, if people want to go to develop something on top of, it could do that. So some people have talked about this as the Wi-Fi or the urine, which some people from defy summer. A year ago. Remember was a token that all that was basically given away to people who are farming it in a similar way. Some people are talking about this as the Wi-Fi of NF T's so my general thought on Concepts like this is there definitely.
We interesting. I think the idea of being able to seed a composable nft community where you're taking, where your fear of game designer. You're taking nft. Is that already exists perhaps for different purposes and you're integrating them into your game and you're fighting those people to join your community. That's pretty interesting to me. However, I think as it's important to remember with any project like this where a, in this case. I respect that the lutein Dom is not promising anything. He's just like we're putting it out there.
But really the value of the future value of this is going to be based on what people build around. So, whenever I see that, I always ask myself. Well, what is the incentive for future developers to build on this? How can it be extended so that more people can participate and what is the long-term viability of it? So, I think there's a lot of interesting proposals for stuff that's could be built on Loop, but I want to see it kind of an operation personally. Yeah, it speaks
to this phenomenon of kind of this Bottoms Up development process.
Something like this is just a general overarching framework. And now they're saying, okay, teams rally around it, use the the structure and extend it and new and interesting ways. And there's already been, you know, are drops of, you know, coins on top of loot. So what was the loot currency called? Like in that one telling like, Adventures go like this was called exactly which for each person was worth quite a bit of money, though. If they were holding one of these original loot tokens, you receive some of that aventures gold.
I was instantly tradable. I believe FDX started trading it and there was a had a pretty decent market cap when it first started trading. But that goal was supposedly, was to be used in some type of game that's developed eventually or to incentivize teams to develop games around this. So it'll be interesting to see if the mass is can come together in coordinate. Something that is a real playable fun thing. Like what gets built on top of this and does that work.
Work. Because I would say there's something about the game development model, when you're an EA, or when you're a big game Studio or even independent game Studio. You have the focus, the drive the dates, you need to hit the resources that you need to go and develop something very special. I don't know that you can coordinate such an effort across, you know, random volunteers. I just have never seen it done. What are your thoughts there?
I think, I think I agree with you pretty strongly in that in the sense of
You know, it's definitely an interesting idea, but there are coordination problems here that are difficult to solve. And I would say the distribution of the 8,000, loot bags isn't exactly ideal. We've already seen a bunch of funds pile into this and presumably they're interested in participating to speculate not necessarily to play the game. And so yeah. And there have been other things. Like, I believe, Dom had issued a spec for how any wallet could be used to generate a non-transferable loop bag based on basically.
The, the public key of that wallet. So I think ideas like that are interesting, but the end of the day, it is about the ownership of these items and being able to transfer them. That's what makes web three interesting. And so right now this is at 8,000. I just if we can see a couple of successful products and games can get traction on it. Then I'll be a lot more interested in this long-term. But for now it's not something that necessarily like buying into. But I mean, that's okay. There's a lot of things in the space. I think are interesting that I don't necessarily take positions in. Yeah. It's
I purchased one. I got one with the Divine robe which is the Divine robes are one of this, the more scarce kind of attributes that you can find out there just because I heard there was a Discord community of just Divine robe members. And so I was like, what's that about some secret? And so I went in and I offed my wallet just so I could get into the secret Discord of divine robe members. And, you know, it was cool. I mean there's a lot of people in there that are old-school d and e which I include myself in that group. I was a pen and paper D&D.
And they're talking about designs and what could be done with it and it was, it was it was a pretty fun little Community to pop in and out of. But yeah, I'm just I'm just kind of sitting on the sidelines but I think this speaks to a larger Trend that we're seeing here where projects are figuring out there trying to figure out one, I think. Well, there's a couple things. If you're a pfp project and you're launching something that is, you know, eight ten thousand drops. You it's now table Stakes to say, I can't just be a one and done.
Can't be a have my really cool. Graphic here. It's out. I sold out and I'm done you have to figure out how can I extend that brand into other projects or other drops or to continue to add value over the years to really prop up the project to keep the community around and prevent them from bouncing to the next thing. And I think more tapes is a great example of a project that has gone out and said, hey, we're going to continue to extend this by adding new functionality to these initial.
All apps that came out which was, is they continue to drop value on the community? I'm seeing this happen. You know, I think Punk Punk's Comics is another great example. Is that something? We're are you
holder of Punk's comic? I am. Yeah, and II had bought a bunch during the initial mint and I think it's been really interesting to watch the Journey of Punk's comic, which started off as kind of, we all bought into these hunks comic assets issue. Number one. I don't remember exactly what the total number was.
Goes like between 8,000 and 10,000 but I bought many of them, a bunch of them. And I kind of just like I knew some of the members of the founding team like a guy who goes by G-funk on Twitter. He is kind of the head of this pixel Vault team. And so it was really just a bet on what can this team kind of deliver and since then they've evolved that comic into what they're calling the meta hero ecosystem. And really the way that this is going to work is they have
When the air dropped every holder of the cam make a mint pass, which allowed them to mint, a meta hero and also you could burn the comics for tokens than the founders douse. It's actually pretty complex like economic game that they've created, but I find it like really interesting. So I'm interested to see how this evolves, because the premise is that the meta here. Our universe is going to be part of a game and there's in there helping to create a dow called up doubt, that's going to promote that game develop. So,
And this is kind of this is a more focused type of development model, but I can see how this is playing on. I'm seeing the community around these assets kind of gained a lot of steam and I think there is a lot of value in those asset driven communities. And I do think it's fair to say Kevin that like probably 90% of them are not going to lead anywhere, but maybe more than that, but then you do have like the Apes who came out of kind of nowhere. And I know you even like, you guys like you and me were like, well is this going to have stay?
In power, I think the answer so far is yes, you know to the place where these assets are being auctioned off at Christie's now for millions of dollars. Also the kind of jumped into relevance but a lot of assets are not necessarily going to make that
transition. Yeah, that's right. And I think the punks comic is you. I bought a few early on as well and I burned a couple because the Dow proposition when you burn them and you get access to their Holdings there. It's actually pretty compelling but it's also interesting to think like well, I can also create
Better hero. And and they give you this token with the later can redeem for another character. So it's hard to say which way you go. What are you doing with yours? If you decided to go meta hero route or burn and and hold some of the Dow so it's
definitely like a lot of like trade-offs. And so when I decided to do was I took half of my Comics up front and I burn them for the dowel took. Okay, and then I still have a bunch of comics left and for each of the ones that I had left. I got a mint pass for those.
And so I redeemed half of the mint passes for that. Okay, and so now I have half of them as meta Heroes. I'm going to hold on to the rest of the mint passes for now because you're eligible for some of the special meta. Hero drops. If you have those, the other way that I also think about Kevin is like, you know, for like I think about is almost like these minute passes are unopened product, almost like booster boxes for trading card games, right? And so, there is a there, as the number of mint passes decreases.
The expected value of the mint from each remaining MIT pass. Potentially is above like the average
value of a meadow
hero. I mean, this is kind of deeper economic. No, but I don't know if it'll play out this way. This one in the home, thinking about it, dude. This is
like the old school, you know, baseball cards. I give you go and you get a series 1 Upper Deck, you know that is sealed. If you open up that pack,
there's a chance. There's a Ken Griffey Junior, rookie card in there.
I didn't like that's right. You just don't know, right? And so as long as it hasn't been like
back in the day, we used to worry about people, like taking an iron and melting the wax in the back of the packs and taking all the good cards, you know, so you never knew what you had when you bought it actual physical pack, but this is this is kind of the same thing, but you actually as long as they don't expire right because that's sometimes with these types of tokens. They'll say well you can have the token but you have to claim it by a certain date, right? So you kind of have to keep make sure that that is going to be an ongoing thing where this will be.
Round and claimable for the future in the
future. Yeah, and I think, you know, in this case, don't quote me on this, but I don't believe that the MIT pastors expire. So you can hold them. And there are also other rewards that they're giving to people who are holding on to the mid pass. If you have, like a comic and meant pass in the hero and one other, one of the other tokens, I can't remember, you're going to be eligible for like an earth token Dow dropped. So it's gotten a little bit complicated, but I think another, here's a simple way to think about it with these sealed tokens, if you will.
Are you kind of have to burn them to get something else? The supply of those can only go down over time? Whereas the supply of the other side can only go up and so that's and that's and you see that reflected in like traditional trading card. Booster boxes for that reason as well, because they can only be opened. You can't go in
reverse, right? Yeah. That's a good point. Well, that's that's really cool. I have a couple meant passes that I have not cracked into meta Heroes yet. So maybe I just hold onto those. I'm going to check on the expiration to make.
Our and confirm that but I like, what puns comic is doing. I think this is a great example of a kind of more centralized approach that is still taking input from the community that for me, has been the winning combination. It is the, the, a play where you do have, you know, they are developing things on their own that they're not telling people about but they're still taking feedback from from the bottoms of kind of community. I think that's gonna be the winning combination. Speaking of pfp, projects, tez the Tesla's, and of tea.
Is the deserts. You seen Tess nerds. I want to get your
thoughts on them. I have. And I saw that you had one. I thought was pretty cool. And it's, like, cool. They look like a lot of fun and I have I haven't looked into these yet. And I know, you know, we have been talking about this but, you know, I think it's great that we're seeing nft ecosystems emerge really across the landscape and while I haven't collected, any nft is off of a theorem yet. That might not be like a permanent condition. But for me, you know, when I think about what attracts me,
Need to at FT, is it really is some of like that crypto ethos and some of the you know, and I think a lot of that is reflected in the theory of community and is reflected other crypto communities as well. But for now, my assets are on a theory. Mm. I'm certainly looking more and more at stuff that's happening on other chains and I don't want to discourage anyone from kind of it minting their nft wherever they want to really, because I think I understand the mindset of like, well, we can't afford to have like
Everything on aetherium it and it will probably never skill to the point where everyone who wants to create something will be able to do it and threw him. So I think it's important that people have ways to express that wherever they want to. Now, of course, Every Chain has its own trade offs in a theorem is included in that. So I think people should take the time to understand that understand if your chain has like unchain governance and if that's something that you want to participate in and so on, but I think it's great to see that some of these communities are expanding no matter where they are.
Yeah, I agree and
Hazards of the, the first kind of big pfp project that is released on the tasos blockchain, hen is a, you know, obviously a very large Market Place on tasos. It's a horrible application.
It's like, it's, it's breaks all the
time and it is just apparently. I don't know that the head engineer, but I've been told that they are extremely difficult to work with. And they basically tell people to go elsewhere, if they complain about certain bugs, and things like that, so,
So there is a lot of supporting kind of new other types of ways to browse that Marketplace because it is an Open Marketplace and so people are extending it and creating new interfaces for it, which I think will will bode well for tasos. Tasos as a chain. I'm not a huge fan of I like the upgrade ability of it and some of the things that they've done but I've just I've seen issues when they. So basically, what happens is they have this thing on hand where they'll all these nft artists will give away an entity? They like pick a day and they
Have this little open free-for-all and it always breaks breaks the blockchain and it just like it's a things slowed. I can't say, I shouldn't say break. It's not like the, the chain Falls over but it slows down to where it's unusable. That's been my experience and even so much. So that when I'm trying to load my wallet, I can't even get my stats about how many Tesla's I have in my wallet and it just like. So I'm worried about the scalability of the Tesla's chain long term. If inapt, he's become more and more popular on that chain. I'm curious though because you are so deep in the
The theorem ecosystem, you know, speaking of scalability, you know, polygon is being supported now, like if you go to Nifty kit, which is a really popular platform for minting and FTS. You can mint polygons in a tease, you can melt them on which is the layer to scaling solution for aetherium. You can also do that on an open sea as well. Have you seen any in FTS that have value being minted on a layer 2?
I mean, I think there's a lot of NF teas that are out there and I don't track a lot of the value. So I don't own, really any of those n, f TZ up. There is something I'm looking at. I do, I'm like, oh, apps and things like that, which are like proof of attendance protocol badges on polygon and stuff like that. So I think those are those are fun and that's a great that's a great type of application for a lower value Network. We might not need like the same security. But yeah, I don't know that. I've seen, like there haven't been as many really
Value. N ft is on layer 2 s or even on other layer ones in a lot of respects. We might be seeing that start to change a little bit. I think a lot of that just boils down to where is the liquid in the liquidity in this programmable smart contract ecosystem is still like 90% or more predominantly on aetherium. And so for as long as that remains the case, I expect that a lot of the really high value work is going to remain on it. Then does that mean that work on other teams and in other places and in layer twos doesn't gain?
You absolutely no. I think it will over time. I also think a limitation with the layer 2 is Kevin on a theory of is certainly with like the new optimistic Roll-Ups and side chains. Like all we got is your tends to be a bridging delay in terms of how long it takes for your asset to hit those layer twos or side chains in the case of Arbitron, which is a new layer to on aetherium that I think the delay is, like, seven days. And so, you haven't seen like a lot of nft is make that journey, I think as we move into more of
A new technology which is called, ZK, roll up. And that's really going to start that. We already have some higher throughput Roll-Ups, which makes them decentralisation. Trade-offs live like a mutable X but in the future, let's say four to five months from now we're going to have more of these. What are called, ZK Roll-Ups and one of their properties is you can make instant deposits and withdrawals from etherium layer 1. And so I could take an ethereum based asset like a crypto Punk or whatever, move it into a ZK. Roll up.
It in a Marketplace, there transact with it or trade it or whatever. And then when I'm done, I can even bring it back to layer 1. It pretty much immediately. So I think some of those architectures are going to be more of the future.
Yeah, that's exactly what was going to be. My next question is I am not against collecting something on a layer 2, but I want the optionality that if said, in Ft asset, just increases a ton of value. So if you're sitting there and you're like, oh my gosh, I bought this thing for one of their time and now it's worth a hundred. Can I bring it back?
To layer one for the additional security. And so, what you're saying is that that will be a possibility
with ZK Roll-Ups. I do think it will be. I and I have been talking to seek a rollup teams offline and I've been sharing with them, the perspectives of nft collectors like you and me where it is important that we be able to and maybe we never do it right? Maybe we just if we meant an asset on a layer 2, as UK roll up. Maybe we just keep it there forever. I don't know. But I think the ability to be able to bring it back to layer. One is pretty important.
Important, just for the provenance, for the economic security for that comfort. And I think that that ability will actually give some of those Works potentially more value. Yeah. That's exactly. It is, I feel I have would have
no problem and I would prefer to do it in a way that isn't taxing on gas and that, you know, I could just quickly transact and all the beauty that comes with layer twos, but I want the optionality to bring it back to a safe in my mind at least a safer place, you know, that's right.
Cool, we'll wait and see what happens
there. Now. You said you had a story about Open Sea
controversy. What happened there?
Yeah, and so, I think that, I think some people listening to this might be familiar. And I think this is a good cautionary, tale, really for the entire industry. And first of all, I really, you know, I have a lot of respect for the business that open sea has built. I have a lot of respect for the fact that they've helped scale this Marketplace activity in a way where a lot more people can participate and then of teas and so on, what
Happened. Here was anyone who's used Open Sea. Typically, if you go to their splash page, their homepage, they kind of have a couple of featured projects on the front page that people can go on and they can see what those projects are. And it's kind of like a, it is a form of promotion, but I believe it's mostly driven by whatever is trending on the marketplace. What happened was they had an employee, a fairly senior one who was seeing those listings before they went live. And in some cases, he was buying nft is an advance of that. And
Selling them after the announcement went live. And so, so this creates it was kind of and I'll be honest with you. Kevin, the amounts that were being traded by that employee were relatively nominal. I mean, they weren't like huge sums of money, but what it presented was it's kind of like it presents a potential loss of trust. When you have an actor like that who is working truly as an intermediary kind of potentially front-running their customers, so I don't want to overplay. I think what that
When did was wrong? I do think that they recognize that and that person has since left open sea, and so I think that that was the right action to take in this case and open sea is issued a statement apologizing for the hate Behavior promising. Kind of more stringent rules around how their employees can act. But I think this is a problem which could really hit any major project in the ecosystem. And I think a lot of this blow, these are things that people in quote the traditional business world. I already
It's like if you have access to Insider information, you have to act with a certain level of maturity and responsibility around that information. I think for a lot of people in the web three space, a lot of whom are younger and maybe don't have those experiences. Don't appreciate the importance of kind of operating professionally and and really think that you know, the test that I've encouraged everyone to think about Kevin is if this if what you're doing gets published in the Wall Street Journal the financial times and becomes the front, the front headline story on CNBC.
See, are you going to be embarrassed by? And that's a good litmus test to be like, am I doing the right thing or not? That's a great point. But I also think at the same time,
is important to let. People know, there is a difference between true, SEC regulated entities that were Insider information is an illegal act and just knowing something new and unique about it in Ft project while it's
would be shameful to trade on that information. It is not the
same as SEC regulated entities where it is actually legal.
That's right. That's correct. It's not definitely not legally equivalent. I don't want to imply that at all because I mean in some of these cases the activity is not necessarily illegal, but it's not necessarily the right thing to do, right? Yeah.
That's it's hard. This is a hard one for me too. And I must be for you as well where you know, there are some of these these projects where I will go like punks comic for example, you know, I had a handful of them and I was like, this is cool. We should mention on the podcast and this was months ago and I mentioned on
The podcast and because there are so many in Ft fans and listeners podcast the floor price rose up by, you know, 50 percent or whatever. After the rally, the podcast went out. And so my, you know, it's like in some sense. I'm like, you know, that's good for me. Right? But I, I've just taken the stance that I just don't sell so I'm not like trying to pump it and then dump it, right? Like that. That would be the bad
thing to do in that sense. Right?
So, you know, I have to be able to talk about these things.
All obviously going to talk about the things that I love. So it's challenging. So I was trying to provide as much kind of transparency there as well. When I do mention a project at and I know it's going to move the floor. I'll say that I have one like I for example, I have a tester but everyone knows that because it's my Twitter profile
photo right now, right?
But but yeah, so it is challenging. But I can see where Open Sea to the right thing here, you know, this happened before on coinbase because coinbase they had some employees that were, you know working there that obviously knew about which coins were going to be.
Stood before other people and that would leak out and then people would find out. Oh, guess what Salon is coming to, I'm just making this one up. It wasn't an issue. But Salon is kind of coinbase and then all of a sudden, Boom, the price goes up because they know once there's a listing there. That means so many more average consumers have access to it and the price will typically jump. So that one to me feels a lot
more like insider trading
in a regulated world, but, but yeah, this is, this is good. What, what the hell's been going on with open sea, with the, with a metadata issues.
Have you run into this?
I have you and I I'm not, I think part of it may be an art box API are, and some of it may be an Open Sea issue. But yeah, just the way that they've been displaying Art, Walk sets in particular. I've had a lot of trouble with lately and where I was able to browse certain sets easily. It's now a lot more difficult and I think it kind of goes to this idea of well, a big all-purpose Marketplace, which is trying to serve every single nft project in the entire space and charges 2.5%.
% listing fee for everything this traded. I don't know if that's like the future. Kevin. My general hypothesis is that we're going to move towards more localized marketplaces for each nft set. Perhaps even perhaps even every nft set and there's are going to perhaps charge lower fees and really give people the opportunity to transact in a censorship resistant way. And then maybe we're going to have aggregators on top of that. And I think over time that's that feels like a more decentralized future and probably
More sustainable than everybody just listing all liquidity on one kind of semi centralized Marketplace. Yeah. I mean it's challenging, right?
Because in some sense, the reason why eBay is so big is because they have the eyeballs and you're the reason you list on eBay. No, one loves
eBay. I don't think it's Crystal of zp. It's like the worst interface
ever. When you're listing things. It's like, you know, I might be bi account. Was that I'm dating myself was created in 2000, and I still recognize a lot of the layout. I'm like, oh, that's the same way. I used to listening in 2000. So
It's it's it's one of those things where you at your earlier point about liquidity. Like the buyers are on open seat. That's how they're searching and browsing. So I don't see how this can get fragmented, like, What scenario in your mind plays out to where that works.
So I think the key difference with like an eBay is that eBay is the trusted party in each of those transactions and people trust eBay. And that is why it has such a strong liquidity effect.
That doesn't mean that other marketplaces haven't been able to take off. They've been able to take off in more Niche sites. Like Etsy was able to really break into the space of like those handcrafted goods and it was able to do that because they felt like they weren't being served by like the way he met was presenting their content in there, the stuff that they're showing, right? So I think similarly, there's going to be an opportunity for em FTS for a custom sites. And for contracts, which allow people to trade, I think the big difference
With on chain activity is we don't need the eBay as The Trusted intermediary. We can all just trust the blockchain basic, right? And so, we can get to that point. I could definitely see a future where, like, art blocks has its own Marketplace and maybe it's using a common set of public good contracts under like a, you know, free and open license where any project can basically create their own Marketplace when they create a set, and then liquidity starts to aggregate there.
Because it's low fee or no fee and I could see our blocks having an incentive to do that because they already get a small percentage of all transactions anyway, so they might say well for the marketplace, we're not going to charge anything similar to how crypto Punk started. I think this is kind of like going back to basics. I would like to see the space, Go Back to Basics and look at what level ABS did with crypto funks and there's zero fee Marketplace. Yeah, that was well ahead of its time. Yeah. I mean, I agree that.
So the reason why I love her larva Labs with cryptochromes worked as
Because they were not the ERC 721 standard, right? So it was, you had to wrap them to get them on Open Sea, which was another additional hurdle. It might not work. So well with me bits, right? They do have a Marketplace for me bits. The majority of transactions do not happen. On lover loves me, but site. They have happened on open seat, right? So that's that's yeah,
you know who's doing? This? Well is super rare. I
would not sell them xcopy on Open Sea because super rare has the
They have been known as this like super collectible. One of one Marketplace. They have high net-worth collectors. If you're going to sell and xcopy you do it on will especially it has to be super xcopy, but you're going to do it on super rare, right? That someone that's carved out a little bit of a niche there.
So I think that I think the problem actually is one of discoverability more than anything and I think right the me bits example is very instructive because you're right. People just start listing them on Open Sea anyway, because the tools for discovery,
Ability, we're perhaps better on Open Sea. I haven't actually compared the two, but that's one possibility. But I think the more likely reality is that people were just used to listing stuff on Open Sea and they just parted putting it there. So I think, as we get like better, aggregator Solutions, which frankly don't exist. I know that a lot of teams are working on this. We will eventually see people just looking at those aggregators to buy on because I mean the open cui isn't bad for some applications, but it's far from great for a lot of applications.
Right? And so it all it takes is an aggregator to do that better even for. If it's like for specific genres, like maybe there's an aggregator for generative art. Maybe there's an aggregator for profile pictures and they compete with each other to charge, you know, and they charge a small fee to use those aggregators, but they're competing with each other regardless of where the old underlying liquidity is. That's a great
point because if you think about it, it's the cross chain stuff's going to be really interesting. Like there's no way for me to do a search for pfp and find.
Hazards, I have to go to that chain. I have to figure out the tool for that. It'd be kind of interesting to pull these together as we start to live in more of a cross chain world, you know, who's doing the something pretty cool. In the space is Universe dot x y z. So they're building a decentralized market place. And that's been a big push of theirs is basically taking all these tools that we spend a lot of money on on the creation side and minting side, and then also on the marketplace side, and just creating it, a completely decentralized platform for it. So, they haven't fully launched yet. They've got a couple projects out there.
But that's a good team working on on that problem.
Yeah, absolutely. Okay.
So upcoming art blocks release where you a collector of sub
escapes I was and I've got I've got I think I have like 6 sub escapes but there's seven of them and I tried to like hand select the ones that I really like, but I'm a big fan of Matt's work and really enjoy that scent.
Yeah, so Matt, I'm going to butcher his last name, but he goes by Matt dessel D, ESL on on Twitter. Did a new post here just recently saying here are some test output
It's from Meridian. My latest, long-form generative art algorithm. That will be released on Art Blake. Our blocks date TBD. These are
beautiful. Did you look at these? I did and they look, I mean, I love the aesthetic of them and they've got like some nice variation to them, but they almost look like watercolor type aesthetic, but with a lot of really
beautiful variation. Yeah. I wanted to mention them here and I'm shooting myself in the foot because I'm going to be there. Amending day trying my hardest to get a few of these.
You know, it's like this is something, everyone is listen to show, should pay attention to because these are so hot. This is going to be huge and I feel I love to get your take here, but it seems like lately. The generative projects that have done well, on our blocks, are the ones that look and feel more like real, traditional art.
Yeah, it has been interesting because there's like the, the fragments I think it's fragments of an infinite Minds which which recently came out by Monica Rizzoli. I hope I got her name, right?
But I thought that was a really interesting and kind of beautiful project which kind of is evocative of this floral kind of arrangement. It's you see like the Reeds of grass kind of flowing through them and you've got winter spring and kind of fall like Aesthetics and yeah, I think that I think it's kind of I think we're going to have Trends frankly and generative art where people like different types of content. And we're just gonna we're just going to go within this going to be a discovery in evolution process.
Yeah that that one by Monica was fantastic. Did you
Going to pick up any of those.
I did. I grabbed, I grabbed three of them on secondary. And they were already quite expensive at that point. I truly wish I was able to get more, but I just I was a really
cool set. Yeah. I'm trying to see what the floor is. Do you have any sense of what the floor is right now? Well, I don't know,
but I mean, I think the last time I checked the list, I want to say it was like closer to 30 youth or something like that. Even or maybe like 20 eith. I honestly don't remember. Actually now, I think it's 16 teeth.
Yeah, it's II definitely
We want to go there and see if I can pick one up. I missed that one. And unfortunately one of the sites I can, I think I mentioned before on the podcast. I'll mention again is floors, dot Cafe. Do you use that side at all?
I use that one. And I also use wgm. I dot IO so which is short for we're going to make it if you're immersed in the crypto culture and and both of them are pretty good. Just to give you a sense of what current floors are.
Yeah. Exactly. Those are two. Good ones that balance between awesome. Well, we'll keep keep people post on maths upcoming drop. Snoop is now
The nft game. Yeah,
apparently and so a lot of people had seen, there was a new entrant to the space a few months ago who went by Cosimo de Medici on Twitter. And of course, you know, evoking the name of Cosimo de Medici from the Renaissance period who was a famous financier and collector and Patron of the Arts. And so as people start to see the types of assets, Cosimo was purchasing a lot of rare Punk's, a lot of rare generative art.
Art and so on a lot of people kind of started to take interest in his personality. And so the other day on Twitter, he he posted a tweet. He's like I'm going to Doc's myself and reveal my true identity. And so he and so this was kind of like a game that led up to and over the course of a few days. And then sometime later Snoop Dogg tweeted out. I am Cosimo de Medici and the internet went insane, Twitter, Twitter when and say this is like a stupid dog, actually Cosimo de Medici and you know it, I think it's still like an
Question, I, you know, if Snoop is actually like running the account or someone else's, I think probably someone else's but the reality is, it kind of indicates that Snoop and other celebrities are now involved in this nft game. And I think they're interested in the cultural value of the assets that are being created in the space. And actually, you know, Kevin just as a personal personal kind of excitement for me. So I tweeted at a smoke short, little rap tweet basically, just as a joke, as I often do on my Twitter.
And I kind of involve Cosimo de Medici in this rap in Vaca, to based on the tune of Gin and Juice by Snoop Dogg and Snoop retweeted that ran away. Yeah, which is probably like my the highest achievement. I'm going to get with a course of my life. It's, I was really excited about that. That is
amazing. I had no idea that
happened. That's awesome. Yeah. I was looking through the
collection that they put in together there and if Snoop owns this collection Bravo, I mean,
A fantastic collection of gradient of T. So, whoever he's working with. I can't imagine this is all Snoop doing the metamath stuff, but maybe you never,
you never know. But yeah, I think it's a guy and he also, by the way, changed his profile picture to a hazy. Nyan Cat by crispy. Our guitar man. Who's been, who is the creator of Nyan Cat? And then that's an eye on cat who basically has like a marijuana leaf as his body in a smoking like a joint. I think it's just it's really interesting to see the
flux of traditional celebrities into the nft space. I think they recognize the value of the culture that's being created. And obviously, there is a lot of money associated with these assets and, you know, they get value out of participating in it, but I think it's just it is a signal of how strong the nft culture is and how how much it can really make the leap. I think into mainstream culture and really bring crypto culture along with.
Yeah, and you know, it's funny. I think that artists specifically music artists they
To just grok it and understand it right away. An odd thing that that is actually, you know, I was doing enough. He's way back in the day and then lost touch those everyone did for a few years. And then in January of this year. I was on a clubhouse and was on one with Mike Shinoda who I've known for a few years and Mike was like Hey, like, what are your thoughts on all this craziness in FTS? And I was like, what are you talking about? Like, what's going
on? Yeah, and so he was like really into this early on and
Just got it right away. And I was like, he actually is the reason why I'm now back in, if he's I mean, I'm sure I would have caught on eventually but he got me kicked started again in January and that was and he was producing stuff on a sink art and a few other platforms. That was just like, it seems like it's a natural extension for for to kind of bridge over into this world for a lot of creative people.
Absolutely. And I think a lot of that as we've talked about before, boil down to the content. Reward models are much more
For the artist. There's the royalty
model. Yes, and it just
I think it's just going to attract a new level of talent that we really hadn't seen before. Now, that now that the word is starting to get out, your just going to see that. I actually view the next 10 years or truly going to be a non-ironic renaissance period both for crypto and crypto
based art. Yes, hundred percent agree. I'm really excited. Well, speaking of attracting Talent OR attracting people.
All the rise of crypto art has also attracted hedge funds. Mmm. Yeah, so we gotta hedge funds played in the space. Now, we got venture capitalist playing the spaced lot of institutional money coming in here. What do you think? The impact is going to be on on this on all things that have tea with this kind of funds flowing in.
So I think it's going to be positive and negative and I think I'll start with the positives and I think the positives include the fact that more liquidity in the system more interest in these assets is obviously going to
The prices and that's going to raise. I think the profile of these assets perhaps to a level where traditional participants won't be able to easily ignore them. And I think sucked in some art circles. The reputation of nft is our, and I think, even the curator of the Met said this, he said that it's like Eve use them mostly as a quote commercial Enterprise, and I don't, I think there is some truth in that certainly for a lot of the content that is being produced it, a lot of it is being produced more for commercial interest than for artistic value.
You but I don't think that's universally true and I think it's really easy to write off the entire space with a very broad brush, but I think actually has these values hit points to where when some of these nft you start going for 110 million to a hundred million dollars and they're perhaps not moving around this much. It's going to be hard for some of these institutions to ignore them. Yeah. And so what we do see is a lot of I think crypto native hedge funds, which I which I prefer to see their involvement at this earlier stage like three hours Capital has taken some very
Very significant positions and they started a fund with a famous nft collector who goes by Vincent van Del. Yes, and and they spent, I don't know how much, but I think it's like a hundred million dollar-plus fun. So it's not an insignificant amount in three hours Capital actually bought the goose ringer, which is like a yellow, bodied ringer in the ringers are a series by Dimitri. Sure. Niak on our blocks, but that but that ringer went for 1800 e Thor, several million dollars in this kind of like one of the biggest nft.
Sales to date, certainly for generative are. And we've seen that since duplicated, in a lot of different nft is across other high-value art box sets across Auto glyph. Certainly among crypto punks has been around for a while. Overall. I think it's good to have these funds engaged in. It's not good. If their goal is just to flip these at some point for like a 2X or something. And I don't think that a lot of funds. I know that any my perception of what three years capital is doing, is these
Guys are already pretty wealthy. They're trying to buy these crypto culture artifacts and they see more value in buying and holding them. And being a part of that culture, been flipping them for like, a 2X or even a 10x, right? I think that is like a great motivation to be in the space. So those are a couple of my thoughts.
Yeah. I mean, it is going to be a crazy crazy world here in the next year or so, because you have, I can speak to the Venture Capital side. And I've mentioned this before
for anyone and everyone that is already doing some digital asset investing at as a VC, is considering whether or not they should be investing in ft's as well. So, you know, we truly have most recent fun, 700 million dollars issue around there. We probably have done, I would say, 75 or so wish million if I had to guess this year in digital asset Investments, and that is only going to increase over.
Time and, you know, as you can imagine I'm strongly advocating that we do in a few investing as well and it's happening. You know, it's we haven't done to date but it is certainly happening like for us, this Logistics, question around custody. Like how can we be, you know, we properly store and hold these assets securely for LPS. And so, you know, as I mentioned earlier, with coinbase custody coming online with a Nifty storage and things like that. It's going to unlock a lot of new capital.
And so for me, it's like I sit back and think, okay. Well, let's just say, I have a couple hundred million dollars to go out investing in of teas.
How do I do that in a way? That
doesn't ruin the industry in a thoughtful way in a way that isn't just crushing the floors on projects and you know, but still able to deploy capital. And so some of that is, you know, going back and doing some of the bigger Blue Chip Investments Punk's things like that and then other bits of it are supporting new projects. But in a way, that doesn't dominate them. So that the average consumer
And partake, right? So it's going to be challenging. I don't know how many Venture investors are going to look at it through that lens versus just blowing up these projects and making it, you know, not accessible to the average consumer that said fractionalization is a real thing. And so I can imagine as these projects get bigger and bigger, you know, when the floors are at a million dollars for crypto Punk's, which they will be at some point in the future, it then it's a matter of like, okay. Yes. I own a fraction of a crypto Punk.
As an average consumer, right? So it's it's that's kind of how I see it unfolding. You think that's more or less accurate. You think fractionalization will play a bigger and bigger role going forward.
I think fractionalization is definitely going to play a role in. Give people the ability to both gain Financial but also collector exposure to these higher value assets. Also think, because of the nature of an FTC, there's always going to be new content that is being created and so newer participants will have the opportunity to buy things that are still
But extinct are exciting and interesting to them. So I think all of that is positive and I, you know, my advice to any fund looking to get into the spaces, be thoughtful about it. If we, if us as collectors, get the sense that you're just buying up the stuff you're coming in and sweeping floors because your goal is to dump it, like in a year from now, that is not going to play well versus like if you're buying into select sets and you're articulating at these. You're saying this is why we think this is called William for even being willing to like make certain
wants to like we're buying this because of the cultural value and we want to hold it for some period of time and we want to be stewards of this piece. I think that those are like the types of dynamics that are going to earn some funds, outsized, respect or earn some funds. Not a lot of respect to the opposite of that based on how they choose to operate.
Yeah, and that's exactly what we plan to do it. True. One of the things that is, it's funny when we see crypto companies that come to us and they say, hey, we're thinking about doing a token.
You know, will eventually get there for the launch. We have a vesting, schedule. What do you think of our vesting schedule? And it'll say, you know, there's a whole different different ways that entrepreneurs will structure these vesting schedule. Some will say you have to wait a year. Some will say you have to wait, 18 months, its monthly vesting, it all vessel the same time. There's a thousand different ways to slice and dice. It. We always say the same thing. Sign us up for the longest vesting schedule possible because great businesses take decades to be built and we want to be long-term holders and supporters of those.
Projects. And that's not just like, you know, we've held WordPress DOC for 15 years. It's true. And it's because that's kind of the ethos that we want to build and you'd be
surprised. There are, there are some great
investors out there that say, sign me up for a 4-year vests. I'm in for five year best, you'd be surprised the number investors at say, I want 12 months or less.
It's crazy. I would, I probably wouldn't be surprised. But yeah, I definitely hear you on that. Well, they flip they come in, they buy, they see their
4/5 x in there out and it's it, just, it's a rug pull.
On the entrepreneurs, it wrecks their prices. If it's a big chunk of ownership in the network. That's the other thing too. Is we always make sure that we don't have too much Network ownership. So oftentimes, we will invite more outside people in because we think actually too much VC dollars is a bad thing. You don't want to have that on your books. You want more Community involvement. You want more dollars to invest, like it's it's it's at a note with it's something that we need to. I agree. We need to be more public about. We need to State our intentions and and really make sure that everyone's doing this for the right reasons.
Yeah.
Yeah, I think that's a really wise position to be honest. And I think that is going to be even more important in these culturally important assets. And I think it's totally fine to have funds institutions corporations and even governments by into these assets. I do think a lot of them are going to stay in the hands of what I would call quote crypto natives who really want to Steward these assets and actually Punk 6529 wrote a really interesting tweet along these lines. A couple days ago inspired by a conversation you had with borrowed Karen.
But the conversation was along the lines of a lot of the big sets that are out there. May have already been assembled by a lot of crypto. Native collectors, who aren't necessarily going to sell off big chunks of it. Like how many outside investors are going to come into the space right now and deploy, 50 million to a hundred million dollars. In 2nf T's, whereas you already have kryptonians who have amassed some collections like that. So I think my view on this is it's for the crypto culture. I want the crypto culture to go like really
Mainstream to become one of the dominant Global cultures. And I think we have to invite people to participate in that even people who might not have grown up with that.
Ethos. Yes, agreed. Awesome. Well, let's move on to some more crypto Center stuff. We actually have one more that about in a tease. You did a recent poll about how. And if two collectors are denominating their Holdings, whether an ether USD, what was the reason behind this?
So there's been a lot of discussion on our people and then
T is just to make more US Dollars basically. And I think there's been a long-standing view by many in crypto that a lot of participants who are been buying like fungible tokens, like ether like Bitcoin like other assets are basically just buying them to flip to get more US Dollars. And so I wanted to challenge that assumption with that ft is. And I want the kind of mask. Well, how do you measure your unrealized gains? And then FTS? How are you, assessing whether your quote-unquote winning or not? And surprisingly or not necessary?
Surprisingly but forty eight point five percent of the respondents said that they measure their gains. In eith terms. That means their denominator is either and so they view it as winning it. As long as they're getting an ether, regardless of The Ether price against US Dollars, 16.8 percent said that they evaluate it in US dollar terms, 16.7 percent said they don't care about genes implying that they just want to hold the assets because they dream is culturally important. And then 18% said, just to see the
I think that was that was really interesting and it kind of shows you how people are measuring their gains and ether. And it the more people that do that, the more ether kind of becomes this this money within the metaverse.
Yes. Yeah. Agreed. I'm in the same camp and that for me if I ever think about selling an mft and I've sold a couple. It's like, okay, great. Now I have more ether to deploy into other and if the
projects, right, so it just gives me a way to
diversify. And for me diversity, just means just more.
Not an old old wooden ship but it means more and of T projects the back. So that's yeah, that's the way I look at it in. Are you the same or are you just like I hold the majority of my crypto isn't number two is actually I take that back majority of to that. But yeah, I mess up Solana is
actually the majority, but that was just because I
happen to be early and then and then it's eat. But yeah, so that that is. And I don't ever think about selling it. Like, why would I? It's my transaction currency? It's what I buy eight stuff
with.
Yeah, I think there's a lot that in there's going to be a lot more opportunities to earn income with your ether, obviously staking is here. The income is not redeemable from that yet. But after the merge between youth learning to will be. And so I think for a lot of people, the game has kind of shifted to participating in the ethereum economy and one of their goals is to accumulate more ether. And for me with my nft, as, you know, I haven't really sold very many entities as you know, but when I do look at the games, which is, I try not to focus on it too much because I try to more focus on
Which artifacts are going to have more cultural value. One term, I think about them in ether terms and I think that, that mindset is pretty important because we're not looking a lot of us who are participating in this are not looking to like, exit the system back to Fiat. We are contributing to the growth of a decentralized economy. So I think it's like a pretty subtle point, but one that's going to be like extremely important over the course of the next decade.
Yeah. A curious on the eith to staking side. Those interest rates were
Phenomenal. In the early early days. I believe there is a published kind of chart that shows how they slowly as more. It becomes staked, the the interest rate goes down. And then correct with. I haven't done it yet. So I'm eats taking curious. Have you eat steak yet or no? I have. Yep. Okay. So what I do is I just do Jim iron and in granted, is a much lower percentage, but it gives me the access to get out of that and back in to eat and then I can go buy an NF.
I want to do some kind of crazy purchase. So when you stay can eat too, you are locking it up until the launch of E2. Like there's no way to get out of it. Is that correct? That's
correct. I mean, in there may be some exchanges which allow you to do to get out of it sooner, but basically there then taking on that risk and they're just kind of switching it with you for liquid ether. And so, but that's it for now. That is the case, once the merge occurs, which would say optimistically might be a
Like in the next six months, even then, basically, all of that ether is with drawable and you'll be able to transfer it. You'll be able to sell it. You'll be able to do whatever you want with those taking moves. Right? And then who do you steak with right now? So, I have some going and, like, independent validators. I have some with like, coinbase and entities like that. So, I think that for most people, it's still ice not something I would necessarily recommend people jump into right now because of that inability to withdraw, so I think it's, I don't think it's a bad.
Bad idea just to wait until the merge before you're staking. And right now, I think the last time I checked six point five percent of the entire ether Supply is in staking, which is actually a really high number given how much ether is were so that's worth something like 24 billion
dollars. Wow, crazy. And then these rates are going to go down though, as we approach the merger, correct. They
will yes. So those rates those rates will drop based on the amount of the income you earn, which I think that the current reward
Rate is about like five percent. So we'll see what it normalizes that Kevin and that's an ether terms by the way, not in US dollar terms. I think I would have to accept a double check that, but I'm looking at a dashboard right now. But basically you can expect that. The more ether is staked, the lower, the reward will get. And so, you know, there's just a balance there. But if your long-term eith older and you don't really care about like the US dollar price that much then staking becomes a pretty attractive way to just earn extra income. Yeah. Maybe I'll just
Because I saw a coin basis offering it, do they take a big cut or is it better to do it independently from coinbase? Because I saw there's a bunch of different ways to stake you to. They do. They definitely take a
healthy percentage. I want to say it's something like 25% but that maybe you know for someone who doesn't want to manage it or doesn't want to deal with the custody risk or whatever that may be worth it. So I think right now they're paying five percent. So they're keeping everything else that's on top of
that. Gotcha. Okay. Well, I'll have to look into his maybe I do an episode on on staking E2. Probably good. Cool. So,
Robin Hood has a crypto app coming out in October, which is crazy. They are going to be supporting because, because right now, I believe you cannot send any crypto that you buy in Robin Hood to outside addresses, which is which is nice in that, it's simple and I get that logistically on their back and it makes things a lot easier and this is the reason why I kind of PayPal started that way as well. What are your thoughts
on this? So I think that this is definitely the right move and I know PayPal announced a move like this previously.
Well, and I don't think they've enabled it yet if I understand correctly. But before the way that these these platforms operated was, you would buy the crypto in their it and let's just hope they're buying the crypto on your behalf of the back end, but you couldn't withdraw it. Basically, it was stuck within their little ecosystem and you could sell it and you can withdraw that USD or you could, you know, by something else with that money. Now being able to withdraw the Crips, do I think it's a positive just because it helps to expand.
The number of people actually using the ecosystem and it reinforces these assets, as useful Assets in these decentralized economies. Not just these ways to like make money and then sell to US dollar and pull out.
Yeah, I agree. I think it's a fantastic move for them. You have to imagine Robin Hood is going to be adding an empty support soon. When does Jack change his mind with square and add ethereum
support? I don't know. But have you there was actually a leak where someone looked into, I don't know where they got the information.
It was some kind of a week and they and it showed that Twitter was experimenting with showing like ethereum wallet, addresses, within Twitter. So, I don't know if that will happen, but I think it's to me when I look at it, Kevin. It's just kind of like Twitter's game to lose because Twitter has emerged as a core Hub. Within what, I'll call this metaverse where people are economically and socially interacting with one another. A lot of the discussion is happening on Twitter. And if and if they're not
To play the game of you know, incorporating these webs 3 + ft assets and other Assets in a meaningful way. Someone else is going to do it. So I will see how it plays out.
Yeah, I agree. And I just, I wonder if Jack knows he's a red laser like, if he's like, totally, if he knows, he's a maxim was like Bitcoin. He has to know, right? Like I just don't see how you. It's, how you say, it's all about Bitcoin forever and I hope Bitcoin I love Bitcoin.
Great. It's like the OG project. But I just it's so confusing to me. Anyway, well, I hope I hope that comes to coinbase cash as well because the cash app is is a fantastic app and and they've been such a Trailblazer in so many ways, you know, and adding Bitcoin support very early. I love to see them continue to evolve that, but it looks like Robin Hood is really stepping up here, which is awesome to see. Maybe it'll force her hand.
She just grabs Ali.
Alright, so next story around the launch of our
Bertram.
Yeah, and I touched on this briefly earlier, but arbitrary moves, a new layer to solution built on aetherium with the technology called optimistic Roll-Ups. And basically the way that this works is you have to bridge your assets into arbitrament. Then you have to bridge them to get them out of our Patron. But arbitrary is actually a near evm compatible execution layer, that it that is built on and secured by a theory. And what that means is your transaction. Data is actually stored on a theory.
Every time you make a transaction or Arbitron that transaction data, gets stored on a theory in a compressed Manner. And so this is kind of one of the first general purpose l2s. That's really getting rolling. And another major one that's coming out of test net soon, or I guess out of the developer preview is optimism, which is another optimistic roll up. So what we're seeing is these Technologies are going to allow users to use aetherium in these layer 2 Solutions, but for a
Our lower cost, potentially, as well as five to ten percent of current transaction fees give or take, and it will actually scale as the technology improves on the roll up and as usage grows on these Roll-Ups. So right now, the apps are not necessarily composable from layer to layer 1, but we are seeing a lot of apps create instances on arbitrary. Mm. And I think that trend is going to continue and I think we're now at something, like, 3 billion dollars Arbus room or something like that. I don't remember the exact number.
Like 2.4 billion, which is a pretty healthy chunk. You know, I think that's comparable with a lot of the activity that we're seeing on other layer ones to some extent. And I think that will just continue to grow as more apps migrate over and create instances in arbitration. I'm curious to get your
take on whether or not these layer twos are truly decentralized because I've heard some pushback in that people are saying, well, some of them claim they'll eventually get their others. Kind of our our, our kind of
Of what? What's the current state of affairs on the decentralization side?
So I think with these true layer to Technologies and I want to I'll differentiate it by saying the layer 2 Technologies are different from side chains. So like polygon is a side chain. For example, a really successful one that I think is very important to the etherium ecosystem that is not using etherium layer one for its security, and the same way that a layer 2, but for these layer twos, I think there's going to be a very strong.
Impetus towards getting them decentralized right now. They're their Bridge contracts are still centralized and I get it. Like, you know, this is still all like let's call it like Alpha technology like and I think there needs to be a maturation process that these go through but like there are some guarantees that you have even using these now. So once that Ridge contract is is made with a basically burn the keys to it. No one's going to be able to steal your funds on the other side of these Roll-Ups, and I think that
Might that might even be true. Now. I don't know. Technically, I'll have to. I'm actually having a conversation with someone after this. So I'll ask. But I know that like, you know, one of the benefits of Roll-Ups is your funds cannot be stolen. You can always execute a transaction on layer 1, to get your car that, you know, assets out of layer 2. And I think that's really the fundamental, like value proposition. There are other concerns around with the transaction sequences on layer 2. Can they censor some forms of activity and so on?
I think that it's up to these teams to really work to decentralize their sequencers. These transactions sequencers. And I know that a lot of teams have that like as a goal that they're trying to achieve in the near to mid-term, right? Thank for now. There are some centralization trade-offs to consider.
Yeah. It's going to be a fun one to watch over the coming months and years to see how this all plays out. That was my only, my only concern I've heard that. And I've seen some outages to, which is also concerned me. I think it was who was it was a polygon, the had knowledge
Somebody had an outage for yeah, it was actually Arbitron their sequencer had an outage but even in that situation, Kevin, you can still execute a transaction on layer 1 which will which will work on layer 2. It's just their transaction sequencer so that you get the cheaper. Transaction dozen were so interesting, so I
can go into layer 1. I can execute a transaction that will pull my funds out of that layer to even though the layered that layer 2 is quote unquote
down, even though the sequencer is down. Yes, that's
cool. That's really cool. That's awesome.
Mm. Yeah, so that's the benefit of storing that data back on layer 1 then so you have that that way to interact with the even if it goes
down. Exactly. Yeah. The way that I think of layer to the analogy that I've used is think of think if etherium layer one is Manhattan, you know? Right now, without any layer twos. It's basically like Barnes and one story houses built on, man had the layer to Czar like skyscrapers being built on it Manhattan. So they increase the potential density of economic activity that can occur on a theory.
Hmm, makes sense. Speaking of outages, Solana. Yeah, man. That was a tough one to sit through. It was 18 hours.
It was, yeah, it's something like that. And he, you know, and I know that there's a lot of team is kind of reinforced the fact that they're kind of like beta technology and what they are trying to achieve is pretty, you know, I mean the level of throughput that they're working to deliver is not insignificant. And so my understanding of what happened Kevin is basically a denial of service.
Back where the ram
resources of the validators were basically overwhelmed and they couldn't process
transactions. Yeah. I mean the the way I look at this and I know this long theme quite well is, you know, they've they've had a few of these issues in the past and they have always said, they are our beta, it gets scarier and scarier the more that these assets move over more, the D5 starts to move over and transact. The more this needs to be a stable Network, right, but that said,
And I'd much rather get these bugs out of the way. Now then, you know, three years from now.
So the the tricky part though, is on the reboot of the
network. And this is what thankfully none of this happened, but they were talking about how when the rebirth Network occurs it more or less has like the last state that it was in and things have changed. Whereas Bots can go in and say, well the price of Solana has changed. I'm going to execute these transaction as quick as possible to kind of get that Delta and capture that.
Upside before everything gets caught up and up to speed and so there can be issues there. Where when a
service is down, you know, the prices are
constantly evolving on other networks and it sets up opportunities for for Bots to have some type of Arbitrage here, which is, which is scary. But, you know, it's just the it has to that, that will always be the
case. Yeah, I think it's a reminder that there's always trade-offs and different Technologies and and I get the technology the trade-offs that so
Alana is making and I think that's suitable and fine. For some use cases is going to be others where people might not want to deploy as much money into an environment, like that. And the only way to figure this out as just to let the market kind of evolved on these over time and I think, you know, while ethereum isn't perfect and is expensive to use it times. It is, it is really remarkable that even over seven years. It's never stopped producing blocks. And one of the things that one of the reasons why a theorem is able to do that is because it has multiple clients that basically
Eight on the same state and run the network. And so if one of them has a bug, which we have seen a couple of times the other clients can take over. And while the network will slow down, it will still produce blocks. So I think those are like the every every network has a different
trade-off, right? Yeah, and that that was the issue. Well those the they actually aetherium had a potential exploit that came against it here a couple weeks back and had no problem because it was only one client that was infected. There was a couple proposed forks and then it just kind of went back to normal operation. Actually, the one that
Attack didn't work, right? Such a, that was that was really cool to see the one thing. I will give us Lana props for is that they advertise fifty thousand transactions per second. The network failed at around 400 thousand
transactions per second, which is just nuts
that that actually was able to happen because they eat. But yeah, it was so it was impressive to see that technology working but there's a few. Yeah. I think the multiple clients will be, would be a huge one. The number of
Alligators is still right around a thousand that needs to be 10, 20 50, a hundred thousand or more in the issue with Salon of though is because it's so performant. It requires bleeding edge, Hardware to run these nodes, right? So in some sense and I'm no, you know, I'm not an engineer working on this project. But like you almost like I feel like a lot of needs like a slow version and a fast version where they can get more people running standard nodes that run. It may be a
thousand transactions per second, you know.
Or you
could opt and say, give me give me the more performant version of Solana if I need it for something, right? I just a but they need that that diversity in in validators and they need. So that's going to be a big push for them. I'm sure.
Yeah, I think and I think having the spectrum of decentralization, trade-offs has is good for the ecosystem because not everything necessary needs the same Mobile Security, even if in the ethereum ecosystem as part of that role of technology that we're talking about earlier, there are
Lakeville, idiom, which use a rollup, like construct, but the data is stored instead of being stored on chain. It's being stored off chain. And so you have some centralization trade-off there, but the difference is that you can do a lot more transactions per second. You can do it a lot more cheaply. So I think that, you know, the market is naturally big enough where you're going to have to mend all the across, all those levels,
realistically. Yeah. Well, this is gonna be fun to watch. I mean, it certainly, I believe Solana.
Had will serve use cases that no other blockchain will be able to sew it that at that high of throughput but we'll see. So off top DC, investor. Thank you so
much for coming on. Know, we're running up
on our hour and a half here and we've got other stuff to do today, but always a pleasure to get your insights in this crazy wild world
likewise. Thank you. Kevin always enjoyed the opportunity to chat with you.
Awesome. We'll have you back on again soon.
Hopefully, looking forward to it.
Alright, and of course, people can find you at. I am DC investor on Twitter and
That's the degree. Also. How often do you write your
newsletter, by the way, you know, I created that blog and I've I need to I need to, I have a couple of posts in draft, but I haven't gotten around to finishing them. But feel free to give it a subscribe and when I, when I do, push something out, you'll be the first to know. Yeah, that's,
that's you. And I are in the same boat. I have this newsletter of like, you know, tens of thousands. People are sitting there waiting for some update. I'm
just never have the time to do it.
That's right, but hopefully this will be the more timely content on podcast like this. So, awesome. Well, we'll talk.
Talk soon. Okay. Thanks,
Kevin.
