ROLLUP: Why BlackRock CEO is Bullish Bitcoin

BlackRock CEO Larry Fink is hitting the mainstream media circuit and he's pumping Bitcoin.

Bankless Nation, happy first Friday of July. It is time for the Bankless Weekly Rollup. This is uh a first of its kind. David is out this week. He is going climbing up mountains. I think he's got three mountains over the next uh 10 to 15 days he's gonna climb. So I am here with Anthony Sesano, and we are taking the roll up to you this week. Anthony, this is the first time you and I have done this, uh, so I don't know what's gonna happen, but uh, I'm pretty excited.

Mm-hmm. Yeah, no, me too, me too. Thanks for having me on again. But yeah, I've only ever done these with David. So uh definitely excited to do one of these with you finally.

So um last week was of course the 4th of July in in the US. So a lot of people um had off, took a holiday. Is there like a uh an equivalency in Australia? Is there like a you know Independence Day equivalency or or how did this work out in Australia? You didn't have to rebel against uh the Brits, did you?

No, no. I mean, technically we're still a colony, uh, or uh uh it which is funny. We tried to become a republic ages ago, but it didn't happen. Um, so uh we have like royal ascent and things still like that. It's just it's kind of weird. But uh we have Australia Day, which is like in January, late January, but I don't think it's on the actual day like that we got our independence. And as I said, technically we're not actually like fully independent. Um, but but yeah, we do have like people do barb do barbecues because it's summer in January here and things like that. It's definitely something that people celebrate, but it's not to the extent that Americans do it. You guys are crazy around July 4th.

Yeah, America goes crazy. I I grew up in Canada actually, and so there's um there's a Canada Day on the first of July, and it's much more muted than when you come to the US the 4th of July.

I know. There you go. Much more muted. Anyway, we got some hot topics of the week, a lot of things to discuss this week. The first on my mind, Anthony, is uh Larry Fink, the CEO of BlackRock. He's suddenly become a Bitcoin stan. All right, versus five years ago when he seemed to hate it. So we're going to talk about that. I also want to talk to you about NFT prices. NFTs are down real bad. There's some tweets that kind of show this, but we can also look at the price charts. I want to get your take on it. Can they recover? Is the question today. There was a rumor that Gary Gensler was resigning. Is that all fake news? What's going on there? Uh, Cameron Winklevoss sent a final letter to Barry Silbert. This is the final, final letter, I think, Anthony, asking for his money. Like, you better give me my money, Barry, or else bad things are gonna happen. We'll talk about that. And lastly, of course, the building season continues. Particularly, I think, layer two season, Coinbase Layer Two, the base launch. There's some news on that. We're also going to talk about Polygon V2, the upgrades there. And a question I want to pose to you, Anthony Will Solana become a layer two? Actually, Anatoly of Solana uh answered that question. I want to get your perspective on it. So, uh, you ready for all that?

Yeah, let's get into it.

All right, well, before we begin, uh Bankless Nation, I also want to mention ETH CC. This is a conference that is upcoming in July. Actually, if you have a ticket to that, there will be a bankless event. If you are a citizen, make sure you check that out. That's on Tuesday, July 18th. It's called Bonjour Bankless. Uh, we are hitting Paris with the Bankless Nation. David's gonna be there. A whole bunch of people from the Bankless Nation are gonna be there. So make sure you check that out. Uh, this event was sponsored by our friends at uh Sega. Uh, so go check that out. Um, they have a yield product as well. And then also wanted to bring your attention to if you can't make ETHCC, of course, the big event to go to is Permissionless, the second permissionless conference we have ever hosted. This is happening in Austin, Texas, September 11th through the 13th. Uh, this is the conference to go to. I'm going to this one. Uh, it's fantastic. Whether you are a builder, um, a DeFi aficionado, a crypto native of any type, this is the conference to go to. We've got a fantastic list of speakers, uh, people like Eric Voorhees, people like Hester Peirce, um, people like uh Tom Emmer, all sorts of folks that you've heard on the podcast, coming live in person. So there'll be a link in the show notes, and you can get your ticket that way. Um, all right, Anthony, let's talk markets. We got to start with our friend over there. We still start with Bitcoin on Bankless, Anthony. You probably don't on the Daily Guay. You're like, you know, like starting with ETH, but um, got to talk about Bitcoin current price right now, as of the time of recording, is uh $30,898. Of course, this will be very different by the time you listen to it. We are up about 2.4% on the week. What do you think of this Bitcoin chart, just in general? If we kind of uh zoom out a little bit, Anthony, how does uh how does this chart look to you?

It looks like there's a new narrative in play right now, which we all know is kind of the ETF hype, right? It looks like the market finally had a reason to go up and finally something that people could latch on to. And that has continued to, I guess, play out, especially with comments from Larry Fink this week, which we're going to cover, of course. Um, and I think people have just latched onto that, and especially traders who love the volatility, right? And whenever there's a new narrative around, they love to kind of uh cause volatility in the markets and play on that in order to to make money. So I definitely think that's reflecting that. But also, I mean, there was um news a few days ago that Sailor bought like another what 250 300 million dollars worth of PPC. He did.

So that definitely played a part in it as well. Um, but yeah, I mean it it it it's kind of the the chart still looks neutral to me. I don't know. I I kind of feel like there's a we we can kind of point to the reasons why it's bullish, and ironically, that's sometimes bearish for me because it means that everyone knows the reasons why it's going up. So they're like trying to play, you know, the markets and things like that. So I I don't know. I'm still very kind of neutral uh right now on it on the whole crypto market, but I do think it shows early signs of uh of uh of a bull market potentially forming.

Early signs of a bull market, but you are are still feeling neutral about it. Is this kind of this chop? Is this uh traders playing trader games? Like it feels like from what you're saying, and I guess my own feeling reflection on it is we haven't seen a new set of buyers, right? So you just mentioned it's old Michael Saylor, dollar cost averaging in, of course. That's what he's been doing for the last uh two years. Um, it's traders maybe playing this ETF narrative game. And by the way, we'll get to it later in the episode, but there was news that Gary Gensler resigned, right? Like this week, and that hit uh Twitter. And you you kind of wonder whether that was planned by someone or not to make some money on some of this volatility, some of this trading activity. But is it the case in your mind that until we get net new buyers, Bitcoin is kind of just going to be like this crab market, side to side, up, down, that kind of thing?

Yeah, I mean, I think so. I think obviously you need net new money coming in for the price to go up. Like you can't have the price. I mean, the price isn't really going to go up too much if it's just the same money sloshing around. Uh, it's kind of like professional poker. If if everyone's the if everyone's as good as each other, not not many people are gonna be able to make much money from that. So you you need you need the noobs to make money from, right? Like that's it, it's it's it's the same in I think every market is where you like the more experienced people do better than the less experienced people. Um, but the less experienced people the ones that bring in the you know the fresh money and they buy indiscriminately. But generally, yeah, I mean, if you look at the shorter time frames, it's always just gonna look very choppy, right? Um, you're on the kind of like our chart here. I'm looking over the the past couple of weeks, it's pretty choppy. But as I said, I think that the the market um definitely is running on a narrative right now. And if that narrative runs out of of steam, it might sell down again because it was just traders playing that narrative. Uh, but then you know, we'll eventually it'll start going back up because of those net new buyers. But yeah, I'm not seeing any signs of like a huge influx of new money right now. Um, maybe here and there is a little bit, but yeah, I'm definitely not seeing like people coming in in in mass and being like, I'm gonna buy everything, right? I'm gonna buy Bitcoin, I'm gonna buy ETH, I'm gonna buy all this other stuff. That hasn't happened yet.

Okay, uh let's talk about ETH. I'm guessing it tells a similar story. We are at the time of recording at uh 1919. That's up 4.8% on the week. So a bit higher than Bitcoin's 2.4%. Um, does this chart tell a similar story, Anthony? Is um ETH just basically trading like like Bitcoin in kind of this crab market territory?

I think so. I think uh it's just following Bitcoin on the USD pair. Um, on ETH BTC, it the ETH BTC tells the real story where it's come down from like 0.07 to and went down to almost 0.06 based on the the ETF stuff, which is obviously more positive for Bitcoin from a narrative point of view than it is for ETH. Even if you believe ETH is going to get an ETF, it doesn't matter because the narrative is obviously centered around Bitcoin. Um, but I think you know, ETH BTC has been stuck in this range for a long time, like 0.06, 0.07, um, which, you know, it's it's it's it's quite an annoying range, but I don't think anyone trades it. I think what they trade is BTC and ETH, and you just you can see the different narratives reflected in the ETH BTC ratio um and the different kind of like trader mindsets reflected in it as well.

So, Anthony, you we were talking um prior to the recording and and you said something interesting. You said that um you believe actually the bull market maybe began a month ago. And now it's just a matter of getting the world to realize that and getting the world to kind of um wake up to that. Uh what did you what do you what did you mean by that?

So, I mean, I mentioned before that I'm I'm neutral and I still am neutral for probably the rest of this year, but bull markets can begin without you realizing that they've begun until like 12 months down the line, where you're like, well, okay, that's when the bull market began, right? Um, and I think this happen has happened every cycle within crypto. And the reason I think it, I mean, there's a few different reasons. Uh, there's a big reason is is gut feel. After being in the ecosystem for a very long time, you tend to have a gut feel about these things. And my gut has actually been pretty good over the last few years, especially for both timing kind of tops and bottoms of the market. Um, but obviously I'm not perfect, I'm not going to get everything right. But a major reason why I um I thought this over the last maybe few weeks is the ETF stuff. I think that there has definitely been a big kind of like win change. And I and I discussed this a little bit with David on the last roll-up I did with him, but there's been a wind change where it's it's kind of like, okay, well, you know, these tradfly institutions, they're not only saying that they're going to get involved with crypto, they're directly making actions. And it's not just anyone, right? It's BlackRock, which ever, as everyone knows by now, is the largest asset manager in the world. So when you have those kind of things happening, um, and prices has actually been relatively muted, I think, as well. You can kind of say, okay, well, you know, in 12 months, we're probably going to look back on this and think, okay, that's when the bull market kind of started. That's when the early, early, early signs were. Yes, it took a while for the market to become convinced. And yes, the price still kind of crabbed around, went sideways, chopped around. Um, but I think that you can, you know, revisit in 12 months or something like that and and look back on it. But you know, and that and that's why I think it's so hard for people to pick it because a bull market can start and the price can still go down. I know that's a it's a it's a funny thing to say, but it's all about kind of timing it. And if the price is just range bound um and the bull market actually did begin, but buying in that and buying in that range was actually positive, you know, six, 12 months down the line.

because the bull market had begun, uh had begun, sorry. Um, I think that is uh is the way you'd play it. Um and and you know, it's not me saying that in the next couple of months Bitcoin or Ether going back to all time high. I don't think so. Um but I I do think that we're in the convince the market that it's not a bear market any uh phase anymore.

Well, I think one of the things that could convince the market is is, you know, um the even the narrative of the ETF getting approved. If an ETF gets approved, that will prove to everyone else that we've sort of hit a bottom on a regulatory FUD, right? Basically. I mean, I think part of the story of 2023 is like, seems like the US is out to get crypto, right? And if we have major financial institutions like Fidelity, like BlackRock, that have an ETF approved, you can no longer support that narrative, right? It looks a bit more nuanced, it looks a bit more mixed. Yes, maybe um US regulators will be hard in crypto in some areas, but they're clearly not going to like ban the asset class. And that is sort of the the worst of the FUD that we feel. So I think it has that effect uh as well. But what do you do in these types of like uh crab markets? Do you trade at all? Like, do you trade kind of uh on the weekly or are you just uh you know stacking by?

No, I d I don't I don't trade. I I definitely don't trade. I uh funny enough, I do more trading in bull markets where I where I kind of

See an opportunity to rotate out of things into other things. Um, and you know, I do that over longer time frames. I never do day trading or week by week. But let's say I've held an investment for a while and it's gone up a lot, but ETH hasn't gone up a lot yet, right? I think to myself, well, okay, I better take these profits and then take them into ETH rather than going um to cash. So I do a little bit of that in bull markets and it's worked well for me historically. But uh generally, no, I don't trade. I definitely do not trade the daily or weekly. Um, and what I was talking about before about my gut feeling, that's like on a year time scale. That's definitely not like a short-term thing. That's a long-term thing where I have to basically pay attention for a long time and then eventually my gut will start saying, hey, hey, it's you know, it's a bear market or hey, it's a bull market. And then I listen to it and it usually goes all right. But maybe I'm maybe I'm wrong, you know, maybe the bull market doesn't start for another couple of years or something. I I don't know. But that's just kind of my gut feel based on, you know, based on various things that have happened over the past few months, especially. And the regulatory stuff is actually very important. I've maintained for a long time that I never thought that the US was actually trying to kill crypto. Um, and I've maintained that I feel like a lot of what Gary Gensler has done has just been for personal benefit. I don't think he actually hates crypto. I think he just knows that crypto was an easy target to get nice headlines for himself. Um, and I think that's actually been the case because you don't have Larry Fink, a huge Democrat backer, by the way, um, being positive on crypto while Gary Gensler, a Democrat uh appointed SEC chairman, being negative on it. Who's gonna win in that world? Who do you think's gonna win? It's the guy with the money, right?

Yeah, I think um I think Larry Fink is uh more of a puppeteer of the of of the politics than than Gary Gensler. Um but okay, so let's um let's talk about another chart here, which and I I I was actually shocked to to see this because I don't typically look at um stocks very much, Anthony. So um do you know the Nasdaq is like 10% off its all time highs? Like that's crazy. So NASDAQ uh fifty over 15,000 this week. Um what's your take on that generally? We're we're back to kind of like the the stimulus check like COVID highs almost. Is this unexpected or what's your take?

Yeah, I mean, I'm I'm definitely not an expert on like the stock market and I don't really spend much time looking at it, but I I have kind of maintained a position for a while that because the economy, um not the economy, sorry, the stock market is so closely kind of intertwined with retirement accounts and money just keeps going into retirement accounts, obviously. Um, I feel like the stock market can't actually go down for very long because you have that kind of buyer there, that always buyer of the of the retirement accounts that are that are ready to buy whenever. And if you look at the stocks, uh sorry, if you look at the indexes as well, it can be a little bit misleading because, for example, not the NASDAQ, but the SP 500, there's like 10 stocks in that that account for most of the the market share. And those are the the strongest stocks like Apple and Amazon, things like that, right? So they can skew the data. But if you actually look at a lot of the individual stocks, especially the ones that were really popular during 2021 and 2020, uh, you know, the COVID boom, uh sort of thing that happened there, a lot of them are down as much as some crypto coins are down, like 90 plus percent, uh, because they were just completely overvalued. They went through the same thing that the crypto market did. Um, but in terms of of things like strong companies like Apple and stuff like that, yeah, of course they're gonna go back up. There's a bid there for that, right? People, you know, Apple is not a not a super speculative stock like uh like an early stage kind of tech company that just IPO'd or something. So yeah, there's a lot of that going on. But I I think a huge, yeah, a huge um portion of buying for these things comes from retirement accounts, and there's trillions of dollars in that. Obviously, you know, BlackRock is the one man money manager of of those kind of things, and so is uh, you know, there's a there's a bunch of others out there. So that that's my general take on it. Um, but then you have the other side of it where

A lot of the macro pundits are saying, you know, this is a dead cat bounce. We're going back down because of all this all this economic data here. You know, things are going to blow up, the inflation's going to come back, you know, roaring back, and the Fed's going to have to raise rates to such and such.

I I don't know I honestly I don't listen to those people because I just don't have enough insight into these things to know who to believe. But at the same time, I try to avoid people who just think in binaries. Like there's a lot of doomerism out there still for some reason. But yeah, it is what it is.

Yeah, it's uh very interesting that if you listen to kind of macro pundits, uh even kind of the inflation, the story of inflation, right? A lot of macro folks thought that inflation would be even a bit more persistent right now. And here we are down to 4%. And you can kind of look at uh maybe maybe the five year chart here is uh we definitely took a pop up close to 10%, and now we're back down to 4%. And so there's sort of this macro debate. We had uh Raul Paula on the podcast earlier this week, and he's a big believer in actually like deflation. Like he doesn't think we're going to see an inflationary decade, he doesn't think the demographics point that way.

Um, he doesn't think that uh, you know, like technology will be a deflationary force and that will overcome some of the inflationary forces here. So there's this, um, I guess there's these two camps that that try to push either inflation or or deflation. I think your perspective has always been, hey, it doesn't matter, like, don't worry about macro so much. Like just regardless of inflation or deflation, we know that the government is going to continue to um print money. And we know that we're in for a decade of fiat debasement where we have 0% or negative real returns, most likely negative real returns on bonds. And in that climate, you want a non state asset of some type. You want an ether in your portfolio. Is that kind of still your take? It's just like ignore the macro noise. Do you really do you take that into account at all when you're when you're thinking about uh when to buy and how to invest in this space?

Yeah, definitely. I I don't think I've ever actually looked at macro kind of things and applied them to crypto and used them as a way to, you know, trade with within crypto, buy or sell things. Um, you know, if if you the on the inflation chart, if you look at where it peaked, it peaked around June, I think, of last year, which was the ETH bottom. I did not buy ETH because I thought inflation peaked. Let me tell you that much. I bought ETH there because I, again, that gut feeling I had um based on a number of different factors. Like I saw 3AC puking up all of their ETH because they had all these debts they had to pay. I saw these, you know, the amount of fear in the market. I saw the ETH getting, yeah, exactly. I saw ETH getting oversold. And I not once looked at inflation and was like, oh wow, inflation's like nearly 10% still. Maybe it's not a good time to buy ETH. No, I I didn't look at that at all. So I generally maintain that crypto is largely kind of outside of the scope of the macro environment, um, at least for now, just because it's still relatively small and it's still got a lot of growth ahead of it, uh, definitely. And and and as you said, like it is non kind of like state backed money for for things like BTC and ETH, which is even more, I guess, like powerful now, where uh a whole new generation has woken up to the fact that the equ the economy generally is in very delicate balance. And at any time it can get thrown out of balance to any extreme degree. And if you want to protect your wealth, if you want to make sure that, you know, one year you are

And you have uh, you know, such and such amount of money, and then the next year you actually have the same purchasing power, at least the same purchasing power, right? Even though all your bills have gone up,

you're not gonna get that from Fiat. Fiat is literally designed not to give you that. That's why everyone invests their money. That's why you're encouraged to invest your money. And that's why retirement accounts don't just hold Fiat, right? They they invest the money. Um, so yeah, I think that whole new generation, um, probably Generation Z, to be honest, they're just coming. A lot of them have come into adulthood recently and have gotten come into money, obviously, from working jobs, uh full time jobs, things like that. They've they've been kind of crypto pilled, I think, over the over the last couple of years for sure.

Yeah, certainly. What you choose to denominate, what you choose to store your wealth in, is actually a much more difficult decision uh these days. And that's why Anthony keeps stacking Guay. Um it's a good move. You know, another uh really interesting chart this week was uh the Coinbase chart. So Coin the asset, um, a big move uh like over the past couple of weeks, a big move up for Coinbase. So it's almost uh at its highs from April. Do you think Coinbase as an exchange, as an asset, has been underrated, maybe was punched in the face too hard by all of this regulatory FUD and prices uh are being restored to balance? Or what's your take on Coin, the asset?

Mm-hmm. I remember uh I think near the bottom I gave a take on it um when I did a roll up with with David. Uh I think it yeah, it was probably towards the end of last year. And I I said that I was not bearish on Coin, but I felt like if you were betting on Coin, you may as well just buy ETH or BTC, um, especially ETH. Uh, but at the same time, like Coin's performance has been, I think, around the same as ETH. Um, maybe not, maybe if you factor in staked ETH, you maybe inch out a little bit more. Um, but I was talking more like long, long term. I wasn't talking you know, six months or something. I was talking uh on on a on a you know the next few years or something like that. That was my general take on on you know whether you were to buy Coin or ETH or something. But generally, yeah, I I felt like because Coinbase is so closely closely tied.

To crypto uh and and crypto kind of markets because most of their revenue comes from trading volumes, it would act the same way as as kind of the crypto markets. It would go down with all of crypto, it would go up with crypto. And I think that's that's played out here as well. Um, but also Coinbase was named as the the partner in a lot of these ETF filings. So that's been a positive uh kind of thing for them. They obviously got sold down pretty brutally along with the rest of crypto there. Uh so yeah, I feel like they're probably poised to do very well. Uh, they're the biggest US-based exchange. Yes, they're being sued by the SEC, but honestly, I don't they're either gonna win that lawsuit or it's gonna be some settlement that that is in Coinbase's favor, or the SEC is gonna withdraw it. I don't foresee a future where they lose that. But I also don't think the market cares because the market knows that that lawsuit's gonna be going on for years. So even if Coinbase for some reason loses, that's still like you know, many years down the line. So the I think the market looks at this and it's like, okay, if the crypto markets are gonna get hot again, Coinbase is the biggest company in the US, they have the blessing of all these big trad free institutions. You know, Coin's probably a good bet here.

Yeah, it's also um increasingly hard to start a crypto exchange, right? Like you gotta look at who are the competitors to to Coinbase and Kraken and these types of exchanges. And I mean, I uh look at a lot of startups, as do you. Haven't seen anybody trying to start a new crypto exchange from from um from scratch. The last person who tried to do that was SBF, and look where that ended up. Um this is also a high contrast week from uh the perspective of NFTs versus DeFi. So NFTs were down bad. We've got Beans down 69%, Azuki 58%, Moonbirds 24%, Port Apes uh down uh uh 23%. And relative to DeFi tokens, so comp was up 80%, pendle 66%, maker 32%, uh DPI, which is a DeFi index up 12.6%. Now, some of these are just probably picking assets to prove a point, and this is only a seven day performance. That said, um maybe this is a sign of some sort of decoupling. I mean, uh NFTs have been on a tear, have probably overperformed DeFi in a lot of ways, at least during the the last um bull run. Uh, is this DeFi coming back? What's your take overall on DeFi tokens?

Yeah, I mean, it's kind of hard because there's so many of them, right? And you can pick out any bunch of them. Um, and you know, maybe they have good performance over seven days for just no reason at all. Maybe they just went up because speculators were speculating. So I agree with you. Seven days is probably too short of a period to draw any kind of conclusive narratives from. But if you look at the assets listed here, like comp and MKR, right? Maybe

It's going up because people are betting on the fact that the TradFi people are coming and they know how to invest properly. They know how to look at price to sales ratios and they're going to buy the bags that actually have kind of metrics behind them. They're not just going to buy things for speculation's sake. And that's a fine thesis to have. But at the same time, I think that's more of a narrative than reality because I don't foresee these TradFi institutions buying random DeFi tokens or just DeFi tokens generally for a little while still. Uh, not in any kind of size either. And I don't expect like a comp or an MKR to get like an ETF anytime soon, right? So I feel like people are just betting on and speculating on that side of things. Um, with NFTs.

Honestly, I'm not like an expert on NFTs, but from everything that I've seen over the over the past few weeks, I think the common sentiment is that people finally woke up to the fact that a lot of these NFT projects have no intention of ever actually driving value to the NFTs themselves. They have no intention of building a community or an ecosystem. They took the money and they're just keeping the project alive to make it look like it's not a rug, right? That's my general opinion on a lot of these NFT projects, actually.

Anthony is cynical on NFTs. We got more uh stuff around NFTs to talk about, including uh is this an NFT winter? Is there a way out of this pain? Is there going to be utility in the NFT market? Also, gonna talk about um the SEC and these Bitcoin ETFs. Larry Fink, CEO of BlackRock, came out very strongly. He's on a mainstream media tour talking good things about Bitcoin. Uh, and we'll get to the Cameron Winkelvoss letter to Barry Silbert as well. But before we do, we want to thank the sponsors that made this episode possible, including our number one recommended crypto exchange. It looks like NFT winter has come. Maybe it's been a long time building, but uh this week certainly confirmed it to me. This is a tweet from uh a Wall Street Bets meme account. Uh, someone purchased this board Ape NFT in October 2021 for $3.4 million. Today, the highest bid is $57,000 from $3.4 million to $57,000. Um, apparently, this was purchased in a Sotheby's auction as well. So this wasn't just kind of like a wash trade type purchase, at least it doesn't appear to be. Uh, the meme account continues to go on. The buyer could have purchased this 120 foot yacht instead. Uh instead, they have a picture of a monkey, or instead of purchasing a monkey picture for 3.4 million, the buyer could have owned this mega mansion compound.

Just really rubbing it in. And this is the NFT price floor. So a lot of pain in the board ape community. CryptoPunks are still kind of faring okay. Um Azuki's down to kind of number eight. Um, we can look at some of these things in terms of ETH denomination, which is you know how I think both of us like to look at this. And so I'm like board ape has at its peak, uh, floor price was 128 ETH for a uh an ape, and now it's down to 30. So when you look at not just dollar denominated, but ETH denominated drops, we uh we have kind of a disturbing picture here. So maybe just continuing your your your thought um from from the last. So you think this is

basically the market waking up and realizing that all I have is a dumb monkey picture. Is that is that kind of it or is that too cynical of a take? What what do you think, Anthony?

Yeah, I mean, I think, as I was saying, that illusion that had been kind of prevalent with these projects that they were actually building out ecosystems, that they were going to drive value to these NFTs in some way, whether it be through creating like a video game or some kind of community thing or some kind of social thing. Um, I feel like with the Azuki Mint, that illusion was completely shattered because Azuki's is one of the you know the biggest NFT projects. They've raised a lot of money and they came out with this new collection that literally, as you said, it was a derivative and it it barely changed anything, right? And people couldn't even tell the difference between the NFTs. So I think that triggered a massive sell-off where people were like uh people finally waking up and panicking and being like, oh my God, if this is what they're gonna do, then what are my Izuki's actually worth? Like, if this is the best that they can come up with, even though they have all this money, um, you know, this is this is really bad. So, and I think that sentiment just kind of played out very quickly across the whole kind of um NFT community.

And also, uh, it's a lot more efficient to trade NFTs these days because of marketplaces like Blur, whereas in the past, uh, we didn't have these marketplaces. So the price discovery was actually less efficient. But people were blaming Blur, saying, oh, it's Blur's fault the NFT prices dropped. It's like, well, on the flip side, you could blame the fact that there wasn't an efficient market around before for these NFT prices going up so much because it it wasn't real, it wasn't like uh I wouldn't say real price discovery, but maybe it wasn't the most efficient price discovery. And now that you have more efficient price discovery, you can actually see the true value reflector of these things, right? Um, so yeah, that's my general take. I'm not an expert on NFTs. I don't know what these things are gonna do, whether they're gonna go up or down from here. I do subscribe to um the fact that most of these projects, especially the PFP ones, are just gonna act like every project in crypto, uh, or most projects in crypto, they're just gonna like go down only a lot of the time. Um, and they're not gonna outperform ETH over the long run. So, yeah, that that's my general take. But as for specific NFT projects, I I don't pay enough attention to know which ones are gonna do well and which ones aren't. So I refrain from kind of making those kind of comments.

Do you know I I want to ask you kind of a meta question here, Anthony, because I know you are a collector of uh real life things, of real life uh, you know, action figures, all sorts of different collections. Even I'm I'm looking kind of behind you and I see all sorts of different things in your room that you've collected. So that has appealed to you. And you are also a crypto native. Um, but the NFT thing hasn't really stuck to you. Why is that? Why hasn't there been an NFT that appeals to Anthony Susano yet?

So

Generally, I like like physical collectibles a lot more than than digital stuff. Even though I spend so much time in the digital realm, I don't get the same connection to digital collectibles as I do physical collectibles. And it's not just because they're they're physical and it's kind of a different different thing. It's more that like I like putting things on display and having them around me and kind of having like in my my office right now, uh, you know, I've got all these figurines around me, have my collectibles around me. It's kind of like a vibe, right? I don't know how to describe it. It's like a vibe, it's like a comfy place for me to be, it's my safe space, and I like that sort of stuff. Whereas with digital collectibles, I never had that feeling because a lot of these things, there's no like in game world you can go to and like put on your Crypto Punk as your face and act like that. Yeah, you can't create a vibe.

It's more of a social

No,

game, wouldn't you say?

yeah, exactly. And I I don't care for those games at all. Because if I did, I wouldn't be hiding all this figurine stuff in my room, right? I'd be I'd be opening up like a showroom for it or something. But I I I actually don't care about that stuff. So yeah, it's it's partly because of that. The social status games don't really appeal to me. Um, but also, yeah, the the fact that a lot of these things uh are art as well, like the most valuable like pieces, not the PFPs, but the other things that art. I'm just not someone who

uh is kind of partial to traditional style art or kind of like contemporary art. I'm more partial to art and as an as kind of like um things like you know a lot of my figurines are from anime a lot of my other collectibles are from things that maybe I grew up with and stuff like that like uh like like video games so I'm more partial to that stuff but I understand why people like the NFTs they make it their like the PFPs they make that their their identity but that could also be very bad because you're speculating on these things and there's a market for them whereas my figurines there's no market for it. It's like an eBay but like I don't check the prices every day so I'm not crying over it if it goes down in value or anything like that.

I almost see you as more of a collectibles purist then. You're actually doing it because you enjoy the um the vibe of it, the feel of it. Um you're not doing it to play kind of status games. I feel like that's much different than at least this version of NFTs in crypto where you it's just bored ape. You're joining a club, you're joining a group that can flex on others because they spit spent $3 million on a monkey JPEG and they could put it as their Twitter profile. It felt it has always felt to me much more like a you know Rolex type of you know social status game, only in the digital realm than what you're doing here. Here are some takes from folks in the NFT community. Lopify, I've changed my position on most NFT projects. I'm infinitely bearish on 99% of ones that exist today, unless things change. I'm not talking about random new ones. I'm talking about the top established ones. The speculation isn't even around a future project uh product. No one even knows what is being built for most. And if they do, the value accrual towards the NFT isn't clear. On the art collectible side, there are still some collections that I think remain pure punks, autoglyphs, fidanzas, ringers. I'm not sure how long this extended bear lasts, but this week certainly marks the next stage. They go on. Are NFTs done? No, that's a silly statement. But if the bull market resumes, it doesn't mean any existing projects have to pump. That is another realization that I think has been reflected in the product, which is NFTs as a superclass may be very successful. It doesn't have to mean the last generation of NFTs will be the ones that pump. I mean, some could remain, but this um this Twitter account, Lopify, is saying 99% of the ones that exist today will probably go to zero. It sounds a lot like

ICOs, it sounds a lot like uh you know 2017, 2018. Avachall uh continues a thought that is related. NFTs are this cycle's altcoins. We are seeing liquidity flee and rotate out as the excess comes to an end. Just as with the ICOs, the ADIQ belief is actually right, just too early. Ethereum, Solana, Layer 2s, DeFi, and stablecoins all came out of the excess of the ICO boom.

Just took a few more years. Some marquee NFT projects will survive this cycle. A few new projects will learn the lessons from the cycle's excesses and invest in real user value. Uh they uh Avachel goes on. Humans need to socially signal to each other luxury goods, collectibles, video games. More applications will run on NFTs in a decade. The world's richest man sells physical NFTs after all. Uh, who are we talking about there? Are we talking about Elon? Who's the the world's richest man sells physical NFTs?

I'm not sure.

Anyway, this idea that NFTs are this cycle's altcoins. What do you think about that?

Yeah, I mean, uh I I think I said it before where where I said like it's the same as any projects within crypto. Like most of them are going to fail or go to zero, right? Um, and I I think that's true for the NFT market as well. But the NFT stuff is a little bit different, or the NFT ecosystem is a little bit different because it has the art side of it. And I think when it comes to art, it doesn't actually have to do anything. Art doesn't have to have a roadmap, it doesn't have to have like a future value accrual plan or a team behind it. All that art does, good art does, is need to exist and invoke emotions for people or um, you know, uh uh be nice to look at for people or whatever people find valuable or the social signalings, things like that, right? And that's actually why I think punks have held up, you know, relatively well to other NFTs, is because there's no roadmap for punks, right? Punks don't exist to uh to kind of like

Exactly. It's literally this is what you get, right? You get like a JPEG, and it's a pixelated JPEG, and it's a kind of pure NFT collection because it came out like it wasn't the first, but it came out in like 2017 where NFTs weren't really a thing, except like crypto quit crypto crypto kitties, I guess. Um, and it is a social status symbol too, because they're still relatively expensive. Um, you can basically imprint yourself on it because a lot of these things look different, and you can find one that looks so sort of similar to you. You can use it as a profile picture, things like that. But

Yeah, and it's the OG, right? So it has OG status. But I think the number one reason it's still so valuable and and relative to others and it's done so well is because of the fact that there's no expectations here. No one's expecting crypto punks to be more than just crypto punks.

Well, let's move on from NFTs for now. So uh Anthony, some other big news out of this week. Um, BlackRock CEO Larry Fink is hitting the mainstream media circuit and he's pumping Bitcoin. Here he is in a clip on Fox Business. I'm gonna play this.

And also I do believe the role of crypto is um it is it it is it's digitizing gold in many ways. It's a uh it's a instead of investing in gold as a hedge against inflation, a hedge against the o uh the onerous problems of any one country or or the or the devaluation of your currency, whether whatever country you're in. Um