3/ For those of you reading this on twitter, recognize the tremendous selection bias at play: that you even follow me on Twitter In the last few months, I've been talking to the CIOs of a lot of major endowments and pensions who collectively manage trillions in assets Trillions
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4/ About half of them "get" the hard money / digital gold narrative The other half, not so much They basically call out Bitcoin for what it is: a pyramid scheme! Then they ask why they should invest in a pyramid scheme?
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5/ Perhaps the ultimate manifestation of this world view is Buffet, who *rails* on gold. His rant goes something like this You can take all the gold in the world and put it in a room. 10 years later, it will have sat there, and not produced any value. Gold is therefore worthless
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6/ You can argue that this is missing the bigger picture - about how you denominate wealth to begin with - but there are *a lot* of asset managers and UHNWI individuals who believe in investing in things that are efficient --> improve productivity in the macro economic sense
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7/ These asset managers often ask "You say this stuff can be worth $50T+. What possible story can justify that valuation beyond just digital gold (aka pyramid)?" I think there are only two plausible answers, and one of them is pretty loose
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8/ One answer is "dapps, web3, and a ton of amazing things you can't even imagine yet. It's the next Internet!" This is a pretty poor argument IMO, but it does resonate with some. I don't care for it because it anchors too heavily on the Internet without justifying that anchor
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9/ The other answer is "All of the capital in the world - currency, real estate, bonds, equity, commodities, and equity - will be tokenized, as tokenization is *the right way* to manage value ownership and transfer. The TAM is ~$250-500T depending on how you count"
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10/ The latter resonates. Let's fast forward a few years when crypto is worth $10T. Larger than gold. A lot of money starts to wonder "how much bigger can this get than gold? It's neo-gold sure, but gold has been around for 2000+ years!"
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11/ What's the narrative that causes asset allocators to say "Holy shit, at $10T, crypto is *dramatically undervalued* because [some platform] is on a clear path to tokenize *all of the world's value*
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12/ But wait, there is no strict reason why the underlying platform should accrue value, even if tremendous value is tokenized on top Yes, but all cryptocurrencies receive the ~98% of Bitcoin's hard money properties "for free" because of the beauty of public key cryptography
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Replying to @MustStopMurad @KyleSamani
It’s not cryptography that gives Bitcoin it’s hardness...pic.twitter.com/Kp75oHJFXu
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Replying to @MustStopMurad
Kyle Samani Retweeted Kyle Samani
Kyle Samani added,
Kyle Samani @KyleSamaniMisspoke here. I mentally skipped a few steps Hard money comes from supply schedule and inability to Change it But on a long time scale, other assets like ETH will be considered 98% as hard as BTC. Point still stands https://twitter.com/KyleSamani/status/1042784185193308160 …0 replies 0 retweets 3 likes
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