David and Anthony Discuss the Crypto Meta

the news the start of the stream doesn't oh it's trying live stream is just always finicky I've noticed oh no we've been live we've been

live yeah what's up Anthony yeah yeah all the all the secret Shenanigans back alley dealing that we do right before the stream starts yeah yeah for hours huh God the hilarious thing about it is that I slept through literally all of it I went to bed eighth was 1700. I got up eighth of 1700 and it was not until until I checked the chart that I realized that something actually

happened wait wasn't it 1850 when it when it started dumping we were way higher I mean I went well I went to bed at like 3am my time um I don't know what that time is for you so it was It was kind of late for me but um and then I woke up like 11 A.M or something and yeah it was at the same price and I I thought we were just crabbing and then yeah we almost never catch dips when we record the prices section during the weekly roll up and it was dumping as we

were doing the prices so I was like oh wow we're actually getting captured this time and then the ending price that we moved before we moved on for the market section to the rest of the of the roll up was like 1740 and then I end the roll up and I look I was like oh my God we got so low oh man yeah I mean I can imagine what it was like for everyone that was kind of awake and witnessing it because I know what it's like I mean I've been awake for those kind of volatile periods but yeah the amazing thing of sleeping through it was that I felt nothing right I got up and I'm just like oh okay we

dipped we did this thing you know apparently a billion dollars was like uh liquidated or something of Leverage I was like why are there so many leathered Apes still in this market like what who has the money to do this right now well it's like my idea on that is like if the longer you wait the more people take Leverage so like so like as as liquidations don't happen like like people just like okay I'll take leverage now especially if you're going sideways for so long which is what happened and like

the fact that there's no real new money coming in I mean I think we can obviously see that given that pretty much everything retraces its entire pump after the Ripple SEC kind of win uh you know we had that big ass pump like everything went nuts especially xrp and now if you look at everything it's back to basically what it was before that happened and I think that just signifies that really all the money that was pumping up the market was just the same money that was already here there was no follow-through from the new money because I you know I've been saying this for ages on my own show that during

these crab markets the reason why it crabs is because there's no new money and this recent thumb seemed to have been as you were saying all that leverage just building up from people just essentially being bored I guess and being like oh we're going sideways I can't get I can't get you know liquidated in this environment well yes you can the numbers stops going down for six months take on The Leverage boys yeah yeah exactly exactly so but it's it's always funny to see people's reactions after big moves like this you know I saw some some bears

you know obviously gloating and things like that and they were saying oh you know I'm gonna wait till BTC hits like 15K that I'm gonna buy and it kind of gives me flashbacks to the bull market where people said no I'm not selling my BTC it's going to 100K right it's the same picture it's the exact same picture it's just reversed right so it's always funny seeing the reactions and then I think that we're so deep into this bear Market that really uh the only reactions that I see are from the trader types the investors are like oh well whatever I'm just gonna keep stacking there's no

Panic really like I didn't see any Panic from the long-term investors that I talked to regularly it's more of okay we dumped you know we got liquidated but hey we're you know we can stack some more we've got more time to stack but I think it's also setting the expectation of what the Market's going to do I think when everyone just accepts that it's just going to do nothing good and it's just going to go sideways mostly and maybe we have these high volatility events which I actually tweeted about a few weeks ago I said they're still going to be high volatility events and you're gonna get washed out if you're on Leverage so I think that's just the norm

right for crypto yeah absolutely and like even if I've been feeling oh like a foundation of bullishness Brew kind of in the same way that you know towards the end of the last bear market like you had a lot of real reasons to get real excited like we had uniswap we had maker we had compound we had Ave uh we had a lot of these ingredients curve had just come out and like and for people that weren't in crypto during that time think about like what we didn't and we didn't have any of those things and so going from nothing to

uniswap maker Dao curve Ave uh was like a paradigm shift and so like here we are all we were all being on chain even though we didn't even use those words and we had this underlying bullishness Foundation build up but no one outside of crypto was paying attention to that and so that's why you like yes you are excited you have the alpha but it's not going to happen right now like you you have you there's like at least a Year's of time before like you have like the bullish sentiment Foundation grow before something starts to like poke up and Sprout into the mainstream culture

mm-hmm yeah and we were just actually saying briefly off air I was telling you how I remember at the turn of like the New Year in 2019 obviously eth had come off its you know all-time high 94 down went to like 80 bucks and it was a pretty bad time for the prices of everything really uh and then you know the the year turned and everyone was just kind of licking their wounds stuff like that and then I was thinking to myself you know all this stuff to be bullish about in the ethereum ecosystem we had the early kind of D5 stuff going on as you mentioned maker you need to swap things like that uh and we had you

know there were still discussions around proof of stake what was going to happen with that uh the ethereum road map generally and because you and I were so close to the ethereum you know road map and paid so much attention to us we were like holy crap you know we could see the next five years of ethereum but no one else can and we were that's the reason why we were bullish at the time of buying eth at those levels but even still it took eth another two years after that uh even a little bit more than two years to go back to its old all-time high because it didn't actually reach 14 20 whatever it was until January 2021 uh which was yeah more than

two years from from that point so if you apply the same logic to the current markets kind of cycle that we're in right now and think to yourself wow look at all these bullish news that's happening l2s are popping off right we have more articles that we know what to do with these are PayPal you know ETFs all this kind of bullish news uh but the thing is is that like the market isn't pricing that in because as I said there's no new money coming in uh the fundamentals take a a while to play out yes they're bullish now but it's because we're aware of them we know it's bullish but other people aren't aware of it

other people aren't paying attention to it and it just takes time for for that to kind of filter through and as you said Sprout up essentially um it's let's like at the seed seedling stage and then it needs to sprout up and then everyone notices the big tree right so I think that that's the exact same thing that's happening now and that's why I keep iterating to people whenever I talk to people about this is that I just I I have the biggest Vibe of 2019 right now I just it's deep within me I'm just like I feel like I'm back in 2019 and I feel like I see it so clearly and I'm seeing the woman in the red dress if I'm

reading the Matrix code that's literally how I feel some days because it just feels so Eerie I mean obviously I could I can be wrong right obviously it's you know it's not gonna a history is not gonna repeat exactly but I don't know I just I don't feel fundamentally bearish like I I feel like we washed out everything last year and now we're just in a holding pattern waiting for the kind of seeds to grow certainly yeah and the 20 we had a year of bullishness like everyone was bullish during defy summer and that was like uh March or April of

2020 until December when ether started to actually act so we had we had people making life-changing amounts of money from March until December of 2020 and that continued on but also like making life-changing amounts of money while ether was below 450 and it ether stayed in that same range it was like 300 to 400 which was just like on the higher side of the bear Market but it was a number that we saw in the bear Market throughout for the past three years so

ether stayed at this like low level for the whole year while people were printing life-changing amounts of money during D5 summer and everyone who was in the war the market was like paying attention was playing the game was knew it was on but like it was like The Insider bull market like if you stuck out through the bear market like you got to have all of this like Alpha for yourself because like we're printing governance tokens defy your farm Etc et cetera et cetera and it didn't show up in the blue chips and Bitcoin was starting to make moves but either wasn't

um but like still mainstream was making moves off of the uh I think sailor stuff like Elon Musk buying BTC like that kind of stuff it was getting the attention um because of that because I remember eighth BTC was going down and it was because of that like it was getting more mainstream attention from from those kind of headlines oh sailor bought his first Bitcoin in 2021 uh well I I was it 2021 I I remember 2020 maybe maybe I'm just remembering sailor but I know that there was Tesla I'm pretty sure Tesla first bought in 2020 didn't they I don't like okay so

the the line I remember going on throughout crypto Twitter was that both Bitcoin and then like a few weeks later ether made all-time highs and no one in mainstream media was talking about it like we broke through all-time highs crypto Twitter was jubilant and no one outside of the world like saw that that was coming or was even talking about it did not register on their Radars and in my mind in all of our minds we were like yo like we just broke through all-time highs and they're still like not new

money coming in or not massive amounts of new money new money was coming in but like not the Sailor money that so I just Googled it because I was curious so Tesla bought in Feb 2021 but sailor actually bought in 2020. um I think as early as like September or August or something so that's what I was remembering yeah he was like Making Waves of doing these huge BTC purchases and then everyone was meaning that oh wow all these companies are going to start buying PTC and of course we saw some follow-through with Tesla but it didn't really materialize we saw some companies here and there I wrote this

tweet that more companies will own youth on their balance sheet uh than Bitcoin because they were going to need to pay pay gas yeah and that triggered every single Bitcoin Maximus under the sun yeah yeah I mean it usually does right uh but yeah no I I remember that distinctly because I remember hbtc going down a lot even though eth like even though D5 summer was happening and then everyone was saying oh well you know you only need BTC and D5 tokens the barbell strategy that that didn't end up materializing um and everyone just like got wrecked if

they held defy tokens against like Ethan BTC right because Ethan went on its ridiculous run people forget that eath was still like four five hundred dollars when defy summer ended and then eighth went to 4 400 uh in like six months so yeah we were doing rotating to Eid we were doing one of our Bowl case for youth episodes that December because it's like great holiday content and yeah ether was marching past 700 the second week of December and then it would hit 1 100 in January but it was December that

month that was like uh the good month for ether where like all of the whole like D5 token Bitcoin barbell just idea just went out the window yeah and and suddenly everyone started becoming an eighth Maxi instead of a BTC Maxi because there was that trend of everyone becoming a BTC Maxi in the bear market like last bear Market which was a very annoying Trend but I guess it made sense because ethereum had come off icos and everyone had like written off ethereum for dead because they weren't paying attention as we were saying it only had one bottle Bitcoin I already had like three bubbles and big so like

yeah no there was no precedent for ether coming back yeah exactly exactly but then obviously this time around it's a lot different right no one's doubting ethereum's use cases we know D5 this is l2s you know we know we have um you know some stuff like decentralized social media as well and gaming and nfts obviously right so yeah it's just a very different kind of vibe from from that sense but as I said I'm getting the exact same kind of Vibes of there's so much stuff going on Price is not reacting to it but this doesn't last forever it is definitely a temporary

phenomenon yeah certainly one thing that um I've been really enjoying uh out of the bankless ventures like act what do you call them activities that we do activities where we like talk to a lot of deal like teams on the frontier and like the nice thing about it is that you get a lot of signal and there's been a handful of teams that we've talked to who like their number one volume or numbers of clients are gaming companies and like the reason why they have traction is because of gaming companies and they just spit out like large numbers versus everyone else like yeah

like there's gaming come companies up here and then our next biggest category of client is like down here like the number of instances where people say gaming is like going to I mean everyone's been saying this for like a year now and I've always been like even longer than the year but I've always been like all right is that just like a narrative because that's a great narrative like is this real But like after like talking to all these like teams like that are servicing gaming clients like gaming apparently is just like the thing yeah yeah I I think people in crypto like crypto natives got burnt out on it

because a lot of it was ponzi-esque and obviously Axion axis Infinity was like the quintessential example of this of something that went nuts but really when you drilled down into it it was a lot of kind of people just farming the the money right and everyone was going on about how people in the Philippines were able to play this game and earn a living and like that's all well and good but the problem was is that they were only able to do that because it was bull market money right and that's not sustainable for the in the norm um but now yeah I'm seeing it too like I don't pay that much attention to it uh just because I don't have the time to

but I in the daily Discord Channel we have a gaming channel and I see people talking about it and things like that and yeah it is it is real right there are a lot of things happening in in behind the scenes but again people aren't paying attention because they got burnt out from like the first iterations of what happened and they just you know they don't want to pay attention to it because they think it gets maybe a scam or like a Ponzi or whatever it is and some don't get me wrong some of it is right but that's like anything in crypto yeah so

the French Tech thing is interesting to me because there's like two sides of the coin here where you think it's really interesting because it's like something new to play around with and the well not necessarily new because it has been done before but it's like I guess new to some people but there's the other side of it where it's this trend of the financialization of everything in the world not just within crypto where everything is suddenly becoming an investment and I've noticed that with like a lot of my hobbies right everything is just suddenly an investment right if you if you have something that's slightly different than something else you could get more for it

and it's just hilarious the kind of value that people will give to certain items based on memes based essentially it's not based on any kind of fundamentals it's memes and I guess memes are fundamental like if you wanna if you want to frame it like that but the the The Logical conclusion of that is speculating on people right speculating on kind of like influences and and kind of buying their shares with what you do with friend Tech and getting access to I mean essentially it becomes like a paid group where you get to access to their chat but then you can sell your access to someone else and it

becomes this financialization of someone's essentially their their time um which obviously isn't a totally New Concept uh but something that I think that yeah as you said it looks ponzi-esque and it can also be gamed uh very easily um but I don't know I feel like it's an interesting idea for people who want to be involved in that world where essentially you people say oh what if you could invest in an influencer before they blew up right what if you could invest in them when they only had a thousand followers then they got to 100 000 followers and suddenly your Shares

are worth a lot it's like investing in a company or investing in a sports player or something right as a as a company right so I get that side of things but I think that the execution needs to be handled very finely or as as we said it turns into like a Ponzi where everyone's just kind of gaming everything and it's just money in and money out and everyone just like gets wrecked there's this one uh guy who from my Twitter one of my Twitter followers who bought one of my shares and his name's Leo and I like looked at his Twitter account he's got like a hundred or maybe a thousand

followers like not not the biggest account on Twitter but like he said hey can you buy one of my shares I'm like sure because when you're there they don't have any supply of chairs like the shares are super cheap and then I'd see him just like absolutely grinding in his chat and he goes from like just like the long tail of friends account follow like accounts and he's like number four bro and so he he has like 140 uh like shareholders out of I don't know what his market cap is but it's insane yeah one share is 0.58

a half a half an e dude he's it's insane he just goes like Levi yeah 57 holders he's holding 115 people but he's just been absolutely grinding in the friends Tech game and he's been posting out like some of his stats he's earned he's like he posted posted his stats in his uh chat share price 0.39 to 0.58 in the last day up 50 trading fees earned 0.57 each in a day I don't know who this guy is but he's just like this friends Tech

grinder and he's just been making it happen for himself that's awesome though like I I respect that I respect people who put in the effort to do that but I I also have the cynic in me that thinks you know that's the outlier yeah because like friends Tech is fundamentally unsustainable because it's just small accounts buying big accounts right like that that's just how this works it's also it also goes back to like the experiments that were done with uh monetizing social media obviously Twitter has started doing it recently

but one of the first large-scale examples was something called steemit uh and this was around uh a long time ago it ended up being drama around that it got taken over by Justin sarner and they forked it off but the original idea paying people yeah yeah yeah the original idea was paying people to post content and you can imagine what happened right it was overrun by Bots and and and trading of of kind of like upvotes stuff like that and the way that the money was paid it wasn't paid by the users it was paid by the protocol so

essentially the protocol would issue it would have an issuance curve right and inflation essentially and then pay that out to people and of course when there's that's basically a zero cost right because the users aren't paying for it the cost is born by all the the token holders so it's not a cost to the to the user directly it's if they're holding the steam tokens of course as a cost to them but what would happen is it would be gamed and I I saw it it was a lot transparent because it was on chain but it was completely games that everyone was trading votes with each other they were Bots dominating everything and people were making a lot of money uh by

doing this because it was a you know it was a bull market and it was just crazy stuff going on and I remember seeing people just like copy pasting other people's content as well and they were just better at marketing it and they were getting paid for it so I I don't know like that financialization of stuff like that I don't know if it actually leads to good outcomes I think it just leads to gamification of things um in in the worst ways possible and with Twitter I think it's it's rather limited because Twitter didn't start off like that it kind of bolted it on later and a lot of people don't really care about getting paid for their content

they were putting content out in the anyway right before they were getting paid but also on a long enough time Horizon you can imagine that people just spew whatever they want on Twitter to get the most attention which they already do right but they do it to such an extreme now because they're earning money from it if you're earning lots of money from it you're going to go to the extremes to earn even more so it it's it's a tricky business man like it's something that I've thought a lot about and I've never come up with a good conclusion to actually make it work yeah the gamification it puts a lot of pressure on the parameters for how you

distribute money like if if the incentives are on Twitter have changed because Twitter is starting to pay people out money for posting tweets then then like there's going to be some sort of you know economic imbalance right like think think of like what all the numbers that goes into constructing a gas fee like sometimes we Tinker with those things because one is like outsized for the other and Twitter's gonna have to do that to manage the incentives around paying content but like that's a bold case if they can effectively manage their own economy with their like you know money printer that is like their you know money that

they send out for for Twitter content creators that that's like the Bold case for all of this stuff like the whole idea of everything turning into a financial game like the the the one of the big pushbacks against the crypto industry in this last bull market was like the crypto Bros are going to come financialize everything and then and we don't want that because we don't want your finances in our culture right we don't want nfts because we don't want money in our art and I I think that's you know a good worry and it's like a natural immune response but it also underserves the

equal and opposite uh idea which is that culture is finally infiltrating into the world of Finance like both pulled true you can't have one without the other and so a combination of just like some Arbiter of whatever this economic system is like the steam Twitter uh whatever whatever is going to be the monetary policy issuer for how these things actually economically work out and then also allow for that optimize for like good content right because if it's just Bots coming in to tweet out tweets to make content then that sucks that that

fine that's financialization becoming ruined but the bull case is that actually you are instilling culture and allowing culture to manifest better because you figured out the economics and all of a sudden Twitter becomes a better place because it's literally full of culture mm-hmm yeah I guess that's the optimistic approach I don't know I've become more kind of like more of a cynic uh uh the more I use kind of like Twitter uh just because of the fact that the things that seem to get the most attention are literally like fake news right things that are just not true

because people want to believe things right they want their biases to be confirmed and especially when it comes to politics you can put out literal blatant misinformation and people eat it up now the thing is is that there's Community notes which vitalik wrote about recently people want to actually get a deep dive on how Community notes works it was an excellent blog post but Community notes is is amazing right but if you get community notes and it says this is literally fake right this is not a real kind of uh uh factual information uh are you gonna get demonetized for that right like does your Tweet not

count towards your monetary rewards for the month or something that should be what happens but if it doesn't happen like that there is literally no consequence yeah you get community nourished but by the time you get community notes your tweets are already viral right and people are already seeing it and you get all those Impressions and it counts towards your total for the month so I feel like if you really want to make it work you have to take that into account you have to essentially punish the Bad actors or else you just get overrun by them because then everyone will be like well if I can earn money for literally just spreading the most fake news possible

and the most viral news possible then they're probably going to use an AI to come up with something that has the highest chance of getting the most Impressions and eventually what you have is that the culture actually gets overrun by that and just to your point about the culture um just generally and that will tie into something else I wanted to talk about but I don't know if you wanted to say anything to that there yeah take us there yeah yes so the the other thing I wanted to talk about today actually that that I've been talking to you about for a um I don't know a few weeks now actually on and off I've been kind of rattling the the new mental model that

I've kind of come up with for for blockchains generally for crypto ecosystems blockchains generally and I was thinking a lot about this specifically over the last few weeks because I've been thinking about the social layout because a lot of people have been talking about it on Twitter and a lot of people are misunderstanding what a social layer is when in the crypto context a lot of people they're a blind spot they they do they do and I understand why because it's it's definitely a thing that isn't obvious and it takes a while of being in crypto to actually understand why it's important but I was

thinking to myself okay so there's the social air side of things but are there other parts of crypto that people uh get attracted to and that people kind of uh Vibe with at different parts in their crypto journey and I think that I've come up with three categories that it all falls into so you have the social category as I just mentioned you have the economic category and then you have the technical category and those are the three things that I think that blockchain ecosystems optimize for in different ways now I want I count with some examples to illustrate this here so when you think about ethereum as an

ecosystem how did ethereum start well it started with a really strong social layer because it was started based on ideology right it was started based on hey how can we change the world right how can we build these decentralized applications to take power away from centralized intermediaries right that was the whole kind of vibe of ethereum it was it was it was uh very kind of like tight near the start obviously it was very kind of like hacker oriented and and that kind of was ethereum's beginning that's what it began it's social the technical stuff was like more of an afterthought because obviously the tech of ethereum it was a road map to

upgrade it and make it better but it was it was not the greatest Tech right it was very simple and it has remained that way for a long time now and the economics of it were completely out there's no economical thought put into it at all like it was it was really not thought about but then you look at Bitcoin how did Bitcoin start well it had a lot of that social stuff as well right but it also had the economic side of things definitely did not have the technology zero technical but it had the social and it had the economics but then slowly over time what happened with Bitcoin is that the economics took precedent over

everything else right it was all about protect protecting bitcoin's monetary policy at the cost of everything else even at the cost of the social layer and that's why we see with Bitcoin a lot of the social air turned into just toxic kind of infighting stuff like that right and and out fighting too right so the Bitcoin exactly and they've kind of optimized completely for that so there's very little technical uh the social layer is not where where I think it should be it's definitely not a very healthy social layer and the monetary thing is is their main main thing then you look

at these other layer ones that have come over the years right what are they optimized for well they optimize for technical they always set we've got the best tech right we've got better Tech than ethereum we've got cheaper gas fees we've got this we've got that they don't focus on monetary policy yeah exactly they don't focus on monetary policy at all they don't focus on the social layer at all so all they focus on is the technical stuff which then feeds into what actually forms on the social side of things because the social air becomes or where I've got the best tech you know and then they they're kind of like started insulting ethereum and say

ethereum is crap because it's got crappy Tech we've got better Tech and they just they over optimize for that so that's what I mean by that there's there's three high level categories that sit there that up that kind of um dictate what what ecosystems become now I I then related it back to ethereum obviously because we're you know we're both in ethereum uh and and I spent a lot of time in it uh just covering it and I thought to myself okay like what why do I spend so much time in ethereum based on this framework like what makes ethereum special to me well what makes it special to me is ethereum is the

closest ecosystem to hitting all three of those categories in an equal fashion right it has a fantastic monetary policy now in my in my opinion obviously this is subjective right of Bitcoin is hate ethereum's monetary policy but you know we love it right so to me it has a really great monetary policy it has a really great technical roadmap right where we pushed the technical Innovation really to layer two right which I believe is a much better way of of scaling a blockchain not just scaling for you know cheaper gas fees and stuff like that but also scaling the technology and and integrating better

Tech within the ethereum stack and then ethereum has an absolutely awesome social layer where ethereum as an ecosystem has been able to actually attract a really healthy group of people who are in it for the tech who care about the values of decentralization the value values of freedom and and the values of longevity too which is very important like Building Systems that can last a very long time so that is really the core of why I am so kind of like in ethereum and I think that would be the same for you uh in that framework

um and that's I think after explaining all that that is definitely not something that I would expect someone that is newer to the ecosystem to understand because it is a learned thing it is years of experience uh going through the cycles seeing what works seeing what doesn't and then coming to your own conclusion about what you actually want to see um and if we if we look at other ecosystems that that um their current state uh you know people talk a lot about Solana for example and I'm going to start naming names here because I need to I want to use concrete concrete examples um I think Solana uh over optimized on

the technical side of things right they were all about the tech and they still are about the tech right but that meant that social air got corrupted uh because of uh not not these days obviously it's been flushed out but when Solana started they're so I was heavily dominated by profit maximalists which was influenced by SPF and FTX and a lot of the crowd that they were able to attract via that right because those people used Solana's kind of like headlines or we've got better Tech we've got more scalability blah blah as a way to make money essentially right so that was kind of corrupted there but but you know it can

evolve over time it can change over time I still think uh like Solana these other layer ones out there like cardano polkadot all these other I still think they optimize way too heavily on the technical side of things and they forget about the social layout because the social layer then starts reflecting only the technical side and they forget about the other important parts of the social layer which as I mentioned are things like okay how do we actually do decentralization outside of the technical properties right how do we ensure that we can recover from an attack or how can we recover from things

like censorship and all those sorts of things like that becomes an afterthought because they're all they're thinking about is the technical stuff as an ecosystem and uh and yeah so that's like my whole framework and my whole Spiel that I I've come up with uh and tried to kind of formulate in my head and as I said it's very subjective it's definitely not something that everyone's going to Vibe with but that's pretty much the reason why I spend so much time in ethereum is because in my mind it's the closest thing to hitting all three in in a nice equal healthy healthy way 100 yeah that resonates with like a lot