🎙️ 71 - The Bull Case For Ethereum II | DC Investor, Anthony Sassano, Cyrus Younessi

welcome to bankless where we explore the frontier of internet money and internet finance this is how to get started how to get better and how to front run the opportunity i'm ryan sean adams i'm here with david hoffman and we're here to help you become more bankless david we're also here to help people become more bullish more bullish on eth that's what this episode's about tell us about it yeah because the world is not bullish enough on ether the asset this is the bold case for ethereum episode number

two the first we did roughly six months ago with eric connor dc and anthony cesano two of those panelists got invited back because they were extra bullish on ether one of those panelists is now an ethereum alumni i will graciously call him and has graduated from the world of content production and is now doing his own thing and so in in his shoes we have brought on cyrus yunessi who is a former risk at maker dao and now kind of doing his own thing and has really unique and interesting perspectives that i really enjoyed his

contributions into the three panelists that we had today on this show yeah and the reason we're doing this again is because like we like to bring on people who have been right before and look the ethol panel called this in december 2020 right heath price was hanging in the 600s and they said the message was basically the world is not bullish enough eth and here's why here's the case for why wow so much has changed over the next six months including all-time highs

above 4k i think prices proving eric connor wrong to be fair eric connor was absolutely invited he is uh you know just busy with other things and eric we'd love to have you on again of course to talk about this but yeah so like the eighth bulls were right uh and um you know it even overshot i think their wildest estimates at least in the in the six month uh frame and so we're having them back on to talk about it and

you know the story here i think david is like they don't feel like the story of ether um is completed at all in fact at one point one of the panelists said i still think less than 10 000 people know what is about to happen to eat the asset with these with these scarcity supply shocks that are coming online um so this is the case again six months later we review the progress the narratives that have changed um the actual dates that

are feel much more locked in for catalyzing events like eip 1559 layer two which seems like it's finally here we even talk about the advent of dowels so a really great panel and a panel i think that will make you more bullish eth of course like these are permabulls too right so if you're thinking about short-term time horizons like we don't know if price is going up down sideways to be honest but if you're thinking about

fundamental case for why you should be bullish eth this is a great episode to tune into yeah and episode number two of the bull case for ethereum implies that there's an episode number three and an episode number four and so i think the plan is to always update bankless podcast listeners in the world at large as to what's going on with one of the coolest cryptoeconomic network that's out there in my opinion which is ethereum and its native asset ether the asset so without further ado i think we should go ahead

and get right into it the panel itself but first a moment to talk about some of these fantastic sponsors that make this show possible bankless is proud to be supported by unit swap uniswap is a new paradigm in asset exchange infrastructure instead of a cumbersome order book system where trades are matched with other humans uniswap is an autonomous piece of software on ethereum which is what ryan and i call a money robot no human counterparties or centralized intermediaries just autonomous code on ethereum input the token you want to sell and receive the

token you want to buy something brand new in the uni-swap ecosystem is the uniswap grants program is now accepting applications for grants we have been saying this for a while and we'll say it again dows have money and they are in need of labor if you think that you have something to contribute to the uni-swapped out apply for a grant to uni-swap just look at the size of the uniswap treasury it's almost 3 billion dollars this mountain of capital is looking for labor do you have something of value to contribute to the uniswap dow no matter how big or small your idea

is you can apply for a uni grant at unigrants.org and help steer uniswap in the direction that you think it should go that's exactly what we did to get uniswop to be a sponsor for bankless and you can do the same for your project thank you uniswap for sponsoring bankless ave is a borrowing and lending protocol on ethereum and just recently released ave version 2 which has a ton of cool new features that makes using ave even more powerful with ave you can leverage the full power of d5 money

legos yield and composability all in one application on ave there are a ton of assets that you can deposit in order to gain yield and all of those same assets can also be borrowed from the protocol if you have deposited collateral here you can see me getting a 200 usdc loan against my portfolio of a number of different defy tokens and eth i'll choose a variable interest rate because it's a lower rate than the stable interest rate option but i could choose the stable interest rate option if i wanted to lock that interest rate in permanently one of ave's v2 features is

the ability to swap collateral without having to withdraw your assets trade them on unit swap and then deposit them back into ave ave does all of this for you all in one seamless transaction so you don't have to repay loans in order to change the collateral you have backing them check out the power of ave at ave dot com that's aave.com bankless nation we are super excited to have round two of our ethereum bulls last time we did this was december 17th 2020

six months ago almost to the day we have the same set of bulls one new entrant one has dropped off we've got anthony susana didn't make it one didn't make it of the daily guay investor uh eth bull dc investor you know him as well he is an advisor consultant also an ethereum bull and we've got cyrus yunessi new to the show former maker risk management advisor on the maker dow team scalar capital also fixed income trader

this is your ethereum bull podcast we're going to talk about the bull case i think i've said bull like four times now but this is the bull case for ether six months later uh guys it is awesome to have you on the show welcome to bank list thanks ryan david glad to be back thanks guys for having us this is awesome i'm very excited to to get into this six months after the first one guys yeah this is great and and cyrus okay so like uh i think

folks know anthony from the first episode obviously and lots of um you know ethereum based content that you produce on the daily also dc um cyrus tell us a bit about yourself it's funny i looked at your linkedin profile and you know somebody has made it when they have a uh crypto punks image as their linkedin profile your title here is nft uh dealer cyrus what are you what are you up to these days what are you doing i mean since maker like what what have you been doing in the crypto space and

where have your travels led you uh sure uh i mean brief background uh i was a head of risk at the maker foundation for a couple years from 2019 to 2020. um since then um just kind of working on various personal projects doing a lot of uh trading and yield farming but before d5 i was just kind of doing uh trading roles at a few different trading shops long time each fans for a few years now um super excited

about what this community has been up to and what they're building and all that and just the community is a very uh you know it's a pleasure to be part of it awesome man well it's great to have you and uh you replaced eric connor david what's the story with eric connor why couldn't he make it this time yeah the the we want to have these episodes on a recurring basis the bull case for ethereum because as we know ethereum is only six years old so things update and things update really fast and so we want to do these episodes on a reoccurring basis to make sure that we

can stay up to date with always the changing bulk case for ethereum so now we are on episode number two and the rule for the bold case for ethereum episodes is that only ethereum bulls can come and wait wait eric is still an ethereum what are you talking about the least bullish person gets bumped from the ethereum bowl case podcast so eric and his uh his price targets of the last episode of 2 500 well we hit that number uh and now now

we need somebody even more bullish than eric so we're bringing on cyrus to uh to fill his shoes and also offer a unique perspective in of itself as well this is all funny of course too because eric um is proving to be um rather correct in that 2500 price prediction talk about that too much okay we won't talk about too much about that but uh well done eric i'm sure i'm sure you're listening to this podcast um and uh yeah smiling looking down yeah absolutely all right guys well let's

talk about this so as i said earlier it's been six months since our first bookcase for ether episode and i feel like a ton has happened in the last uh six months but i want to start here with maybe price predictions because we're going to start here but we're also going to end here if i'm recalling correctly dc you put out some price predictions at the end of last episode do you remember what those were sir i do and um it was a broad range and i said 4 000 to 20 000.

and um lo and behold we came really quick we exceeded that 4 000 number by a little bit so i i think i was actually technically the most right um perhaps given my broad range and um yeah so that was my prediction anthony uh you made a price prediction as well do you recall what yours was uh yeah 10k 10k all day every day um same prediction i've been making since 2019 but unfortunately we haven't gotten to that yet but i'm not ruling it out uh for i guess like if you want to call

this a bull cycle i'm not ruling that out i think we're just recharging here but um yeah 10k was is my time short term short to medium term all right we're going to ask you that at the at the end of the episode too if that's changed or what and then um cyrus is going to ask you the question but in in your place eric connor of course said 2500 we use calling the top at 2500 for this bull run and i think one of the questions we have is whether we are paused for a recharge or whether like the kind of the bull run is over as it stands or like what's happening in the

market but let's start by talking about the things we we couldn't have talked about six months ago so let's start here what is new and exciting in your mind that has happened in the last six months since we previously did this episode let's start with udc what's going on in eth what's making you bullish so a bunch of things but i think in those six months it's incredible to think how much has happened in those six months and for anyone who's watching this episode i'd encourage you to go back and watch the original episode from six

months ago to see how how i think this group was spot on a lot of things so first and foremost i think ether has started to go a lot more mainstream i guess during that time when we recorded that podcast back in december the ratio the ebtc ratio wasn't doing particularly well a lot of people didn't have a lot of confidence and i think since then ether has really proven itself and ethereum has proven itself i think ethereum has gone through a really exciting period um you could call it a manic period

of adoption that ranged not just from people using the chain for a lot of d5 applications but also for things like nfts absolutely exploded and i mean that was just a minor talking point during our last episode but when we hit january february time frame along with d5 nft is just absolutely blew up and what you saw with that was a lot of new participants coming into the market who perhaps had never participated in crypto before weren't interested in crypto before were

now interested in something like nfts i mean nfts got so big that even saturday night live did a skit on on nfts which i'm sure a lot of the listeners of this podcast may be familiar with but beyond that just talking about ethereum and ether you had a lot of discussion that i think was really starting at the institutional level among even youtubers who are focused on personal finance and other topics started to talk about ethereum alongside bitcoin so i think a lot of what we talked about during that last podcast was ethereum is going to start to enter

the zeitgeist and go mainstream and i think that's that's what's kind of happened over the last six months and i'll even add on to that uh a lot of people were skeptical and sometimes so are skeptical as ether as an asset or ether as a money yet they were specifically compelled by ether as a money because of nfts right it's like oh nfts are being issued on ethereum ether is the thing that i need to use to to play around in nft games now i can understand ether as a store of value and

currency because all of my nfts are trading against ether and so nfts did a very good job onboarding a lot of people to ethereum just as a generalized use case but it also did a very good job of illustrating the concept and idea of ether as money and i thought that was a particularly compelling aspect about the last six months you know nfts made each money you know art is priced in eth i remember that being a meme yeah and i think that that pricing still persists and there's still an open question on how much nfts will be priced in the east versus u.s dollars or

something like that but i think to to pull on your point a little bit further a lot of these new people like bitcoin has traditionally been the gateway crypto for a lot of new participants and now what we're seeing is through nfts and things like nfts people are just going to go straight into ethereum and go straight into the ecosystem and start buying eth to participate in that and i think that was a really interesting development anthony same question to you what's happened in the last six months that we wouldn't have been able to predict on the last bowl case for ethereum pod

well i i basically kind of like mirror everything that that dc said i think that really it is is the fact that eth kind of entered that zeitgeist and we went from being a kind of a niche asset within the traditional finance space to to being more of a mainstream one here and it's it's funny because when we did the last one the last kind of um bull podcast at the price was what like 600 or something like that i think it was just starting its bull run right but we had waited for it to get over that like those those couple of humps that we had built up over the years um and then we

went at 600 like everyone was feeling like super confident that the bull run for eighth was was back on and we were going to new highs you know it's been very turbulent since then but we we went to 4 400 which is an incredible run and we're still at like 2400 today so still an incredible run but i think uh that was due to a lot of that kind of like adoption as well like we all we i i think we all kind of like saw it happening with defy initially and then you know with nfts i think that's what caught a lot of people off guard as well i i really do think that people are

still underestimating how many new people came into the ethereum ecosystem through nfts and specifically used ether's money as you were just saying because that like everyone that had that used ethereum had to use eighth not only to buy the nfts but also for gas at the end of the day and gas prices weren't cheap right like it's only recently the gas prices have gone down for the last six months actually i guess five months prior um not maybe not the last month gas prices were consistently over 100 way and people were willing to pay this because of the fact that what they were doing on

the network was valuable to them because the the market was hot and they were able to kind of make money doing this so i think that played such a huge role in eats kind of adoption there and eats price rise because all these new people coming in saw eighth as like the reserve asset of you know nft kind of mania and they were like well i got to get some eighth right i got to buy some eight to kind of get exposure to this um and also on on top of that with d5 as well you know just the fact that people have to buy ease to pay gas fees i think is just such a great kind of like marketing vehicle really at the end of the day

because if they don't have to use ease to pay fees then they're not really going to get exposure to to ethos like the first thing that they get exposure to whereas in bitcoin if you're you know getting into bitcoin you buy btc whereas with ethereum you can actually get into ethereum without buying eth but the common denominator across all the use cases is that you need it for those for those fees so i really do think that that works as a really nice social coherence tool um the fact that all the fees are in eth um and you know there's some concerns that with layer twos and other scalability solutions that's gonna be kind of taking a back seat but i

don't i don't think so i think that um as time goes on like ether as a feed token should be abstracted away generally but we have one five five nine to make up for that where um and we're gonna talk about that a bit later where the value gets captured in another way rather than in kind of like the social layer way so yeah i guess like i don't really have too much to add on to what dc said about uh you know what what's happened in the last six months in terms of like eighth because it really is just that more mainstream adoption at the end of the day and i think it happened much faster than even you know we thought

specifically with nfts yeah absolutely i mean i i i do think that the ethol panel like man uh you guys nailed it in december right price at 6.50 then and you know not three four months later we're at all-time highs on on eth um so we're hoping to maybe repeat the success here and get some uh really bullish uh exciting predictions out of you but how about you cyrus so i know you've been a long time ether bull not just an ethereum bull but an eth the

asset bull including when it was tough to be a bull 2018 2019 2020 but the last six months at least to me and people have been in this space for a while have felt really different for eth the asset and for ethereum what's been different cyrus so i i think i did my i think i did a youthful podcast back in 2018 and i remember back then i was talking about all of the cool things that were going to be coming into

ethereum and now i feel like we've reached that golden age where um products have delivered teams have shipped all these kind of exciting things that we've been patiently waiting for are here we're starting to uh use ethereum more than just kind of speculate at the base layer um you know dexes have have come a long way in terms of functionality in terms of liquidity and ux uh we're seeing lending protocols are hitting their stride um ave and

compound have seen tremendous success and um you know some of these have moved to layer two such as polygon and you know you're the user growth has been incredible if you just think about that like you know just a year ago we were still like struggling to teach people how to use metamask and how to get comfortable with wallets and now now you just see a large user base that are just kind of becoming very comfortable with the ethereum ecosystem and the tooling around it and then i think critically like all that all those users and all that tvl

has led to uh institutions have finally uh taken note or you know they're just unable to ignore it any longer right there's this kind of just giant elephant in there in the room where all of these users are just kind of seamlessly using ethereum for an endless number of use cases um and they're you know they're enjoying it and it's almost like that that spongebob meme where uh institutions are like looking through the great and they're kind of like bitter about all the fun that the ethereum users are having

and um you know it it almost feels a little bit of like a narrative capitulation they they can no longer say that you know these are just purely speculative use cases or that no one's using it like you know it's just amazing that everything kind of came together uh all at the same time and that's just you know that was all in the last six months so uh dc cyrus is talking about narrative and i have felt a palpable narrative change with respect to ethereum but also eth

the asset let's talk about some like new narratives on the horizon um this ultrasound money narrative right uh institutions taking eth as a non-sovereign store of value seriously people like mark cuban coming out and saying yeah bitcoin's okay but like i'm bullish eth and ethereum because of defy this whole green energy debate as well like there there has been a massive shift in narrative where it felt like the last uh

two years or so um prior to 2021 everything was kind of against uh ethereum from a narrative perspective um the last six months have felt like a completely different world can you talk about the narrative shift that that you felt or seen yeah and i think as you said ryan it was really something that had started a couple of years ago where we really started to think about eth more ether is this important financial asset and that's been a big that's been a big mission of mine as well to help educate

people about that because i think the reality is ether has these unique money like or or valuable asset like properties that a lot of people haven't really understood i think that defy helped to open the door for people to understand that and um listeners may remember during the last um bold case for ethereum episode where i talked about how the value of an asset is emergent in the sense of it doesn't really matter what people said it was designed to be it's really about how

people use it and we've seen that even with bitcoin which was at least stated in the white paper as peer-to-peer digital cash well the network can't scale to support that use case but it kind of had this value as digital gold and that is really what it's being used as today i think similarly ether while it is gas for the network um used to send transactions just like bitcoin is on the bitcoin network has this inherent economic or financial value to it and when i said that defy exposed that what i really mean to say is it really

illustrated how ether can be used as a collateral asset and we've seen that ever since the days of maker really um you know as collateral for die but i think through d5 summer we saw that explode across the board into a lot of different use cases and how ether is like the default lp pairing on uniswap and how a tremendous amount of ether has now been locked into d5 i think the current number of eth and d fire around 10 of the supply or it might be a little bit less than that but also add on you

know i think it's like 4 million that are staked right now which is also a collateral use of the asset so people are waking up to this idea of ether as this valuable asset and this ultrasound money meme i think has been interesting and controversial in a lot of ways and i will say i think the controversy is good because it gets people to think about ethernet than they might be used to whereas for the past few years the narrative has been ether as gas now we're really thinking about is this money and with eip1559 which i know we're going to talk about later that supply is going to start to potentially

deflate as the network is used more and as that supply deflates ether becomes more scarce so i think we're on i think we're actually on the precipice of really jumping the gap into the whole world viewing ether as the world's best kind of natively programmable asset and you know i talked about during the last episode we have we don't really understand how to use that kind of asset yet but but i feel like it's a unique value proposition of ether and ethereum and this narrative and this opportunity is really for ethereum to

kind of seize cyrus i think you have a really unique perspective here from your background with a risk at maker dow because you know managing risk at maker dow you really have to get down to the the absolute truth of the nature and structure of these markets right when when maker dao started off a single collateral die you need to understand the liquidity of ether and its available um the available amount of supply and liquidity of ether on the various markets to make sure that risk of the maker dial protocol would actually work which gives you a very interesting

perspective as to the nature of ether the asset as a as an asset right where's the liquidity is it on dexes like what what about ave what about compound and i think when you actually started off this conversation about the changing narrative of ether because of its use cases in all these applications how have you seen these applications engaged differently with ether the asset specifically in the in the last six months as it relates to borrowing and lending as it relates to dexes uh and and what can you tell us about the

changing market structure of ether and how that's kind of fed into the narrative that surrounded ether as well um well i think you nailed it with the uh liquidity aspect so uh 10 or whatever of all eth locked in smart contracts has kind of uh greatly bolstered the liquidity of kind of everything in the space right every new every new project um you know when they launch their token they build liquidity against heath as an

asset pair i think for a while there in you know in the last couple years there were times where people were wondering if uh stable coins would be kind of the native unit of account across the space and should everything be priced in usdc and ethan is just kind of another asset among many these days everything is kind of focuses and revolves around eth uh users investors everyone are just kind of getting really comfortable with using eth as their kind of just base asset in the ecosystem um

you know myself personally just kind of interacting a little bit less with stable coins as i kind of like move around between various apps that's just um kind of a change i've noticed in my own trading activity um yeah i i think we're just kind of seeing the the proliferation of eth as kind of the the liquidity anchor of all these different d5 protocols um you know it's not like a huge change from before we've always seen that to

some extent but it's just solidifying right it's just the the market for the the liquidity of eth is just exploding indexes uh you can buy huge size you can sell huge size you know as an exercise for anyone listening like go into uh go into the new uniswep v3 uh ui and just kind of like plug in some dummy numbers and and it's it's kind of amazing that you can sell like 100 million or hundreds of millions of dollars worth of eat and and just check

out the slippage numbers for yourself uh similarly on the buy side um and i think i think institutions take take note of this type of stuff i mean elon famously said he uh sold a bunch of bitcoin just to kind of test the liquidity of the market um maybe he has to test that otc because the quotes are you know maybe it's to execute a trade for for whatever reason but you know on the ethereum you can just kind of plug into a dex aggregator and just see right now on the spot how much liquidity can

you get out of ethan it's pretty hefty i think it's a lot more than you know a couple years ago when i was doing risk at maker so we've got liquidity changes as well for ethiosis acting more as a reserve asset for the space in d5 and anthony i want to throw this question to you too because you uh keep a pulse i think on the narratives maybe better than anybody in this space um sort of like a like a twitter meme lord as it were um you're digesting all of this information do you

feel that the narrative has shifted on ether and ethereum over the last six months is it palpable and in what ways has it shifted i mean 100 percent like it has dramatically changed it is as as like someone who's been around since 2017 and experienced all variety of narratives around ether as an asset um even you know over the last six months it's changed so dramatically more dramatically than i i suspected it would and faster than i thought it would change um you know i guess like during

d5 summer i think i i pointed defy summer as the point where pretty much like the skeptics and the centrists in both the bitcoin and ethereum communities um basically came over to eat as an asset and realized the potential of it i i created d5 summer to that um and then we did the i think in the podcast was in december which was like a couple months after defy summer or something like that um but since then we've seen yeah i mean it's funny because it's reflexive right the price goes up and then people pay more attention to it because the price is

going up and then they you know try to find reasons why the price is going up and then they they see the value in it and then they announce that they see the value in it like mark cuban for example and the price goes up because they announced the value in it and you get this kind of reflexive action that happens um but that is the narrative shift at the end of the day that is more and more people that are not like in the weeds like we are realizing the value of this asset and really making us feel like we're not crazy to think that you know everything that we've built as a community every use case every kind of i guess mechanism that we're building into

eth to to kind of like get a crew value to it and to kind of increase this monetary properties like one five five nine and staking that is all coming together and you know for people who weren't around during the bear market uh these things were a thing like uh staking has been a thing for a long time one five five nine was the thing in 2019 but if you had told like any of us like mega eat balls that we would get to the point where we are today in terms of like eighth uh eaves narrative we would have called you crazy because it was just so so different like