Institutional Crypto Allocation: Liquid vs Venture - TOKEN2049 Singapore 2024

hey everyone I'm Tom Schmidt I'm a general partner at dragonfly Capital we're a global crypto Venture fund yeah I'm author I'm the founder CIO of Defense Capital we run a liquid crypto fund right now uh Santiago run my family office been in the space XI hi everyone my name is tar co-founder managing partner at multicoin Capital uh and I'm pravan day I run van next digital asset uh Alpha fund which the liquid token strategy um so m is Santi I'm sure a bunch of us get this question from LPS all the time which is uh why should I deploy Capital into your strategy over just buying Bitcoin because reality is in the last 12 months bitcoin's up like 120% and then you've had the General altcoin market that's only up around 50 so um maybe that's a good place to start which is what's broken in the token markets why are alts not trading as people would expect which is at a beta to bitcoin maybe tou you can get started that um I think the reason to deploy to a manager instead of buying Bitcoin is if you think that manager is going to do things that you can't do right so you should go buy some Bitcoin directly uh and I think it doesn't really make a bunch of sense to go pay fees to a manager to go and like hold a bunch of Bitcoin for you it doesn't why would you do that so I think selecting liquid funds based on their non-bitcoin exposure is probably what I would do as an allocator uh and I think the second part of your question was why are all under performing Bitcoin and I think that's generally just riskof atmosphere uh hopefully you know we see that turn around with rate cuts and liquidity injected back into the market but I think it's very much driven by liquidity yeah I think um you know we talk to LPS and ask a similar question you know tell them you should be buying Bitcoin it's like if someone coming to you asking about equities allocation you know you want to tell them put it all into Venture you know it's like yeah go buy some uh QQQ you know go buy some S&P and um I I think there is value in having kind of like a more of a barbell distribution um I agree with what tar said like ideally if you're allocating an adventure it should be doing it doing so in a manager that sees something or can do something differently than what you would normally be doing and maybe learning in that process um as far as why alter I'm performing I mean I I think um it's actually very bizarre like if you look at the dollar amount um or sort of the fdv of Al compared to something like Bitcoin compared to something like Global crypto markets it's actually quite small so you don't really see this wealth effect that we've seen in previous cycles of you know Bitcoin going up eth going up um and then sort of that flowing in alternative assets so something feels very broken there I think more often it's more just um a lot of these products aren't novel they're not solving a real problem if you look at sort of onchain metrics they're really just like dismal and so um I think projects that um have done something new this cycle actually have done pretty well and we've seen you know new top 100 coins uh from this launch uh or from from the past two years but um it's very rare to see that you you gener only find one team that makes a kind of oneon-one breakthrough um and that's kind of it yeah I think every manager have a slightly different strategy when it come to liquid and for us is I think we are just better than most of the market at picking the token that outperform and we obviously have the track record and um skill set to demonstrate it and I think that's the kind of P that every manager will say and I think on a broader picture perspective is if you're investing Beyond Bitcoin your belief is ultimately crypto is not just Bitcoin and the growth of the other non-bitcoin asset will eventually catch up and I think that's the thesis for why all of uh in the indust in in this industry and for why the token have underperformed I think one big factor is the past fi cycle a lot of the performance are over indexed on whether the retail will buy the car and what we realize is this cycle the retail didn't come back in the same time frame as compared to bitcoin Bitcoin hit alltime high but the retail have not really come back just because Bitcoin hit the all-time high if you look at coinbase volume the institutional volume of coinbase have fully recovered compared to 2021 Pak but the retail is still trading at around quarter of the previous alltime high volume so the retail by almost all data is just not anywhere close to the 2021 level and the second thing is there is a big mismatch in the capital allocated for public market versus The Venture Market um roughly the Capital allocated crypto Venture funds are three times of crypto hedge funds and beside this there's no other like structural buying pressure for most of these altcoin like the project are going to likely going to sell when unlock start for to fund the operating expense and the VC might take profit if they up a lot that's in their fidu fiduciary duty yeah and who's that to buy beside the retail I mean there's just not enough capital in the smart money like liquid hedge fund side yeah I think to add a couple layers to what you're saying there um I remember when multicoin raised its first Venture Fund in 2018 and it was a small vehicle and I think in general it was very hard to raise capital in that 201819 time frame for Venture funds and you had this crazy bull market in 2020 2021 where the influx of retail Capital um was enormous and that created this big altcoin season part of that was you know retail had stimy checks had compounded that wealth through the equity markets eventually made its way to the altcoin market and you kind of saw this Bull Run play out and everyone's got this expectation of the same thing I think this time around retail is broke and you kind of can explain some of that through like mcoin season right which is the retail that is in crypto is trying to hit a quick like 100x and something and is not trying to really like focus on a real thesis or on or at least a medium to long-term thesis could that come back probably he's my guess like retail will come back at some point uh the other thing I think that's interesting is you know my team and I did this uh study research project whatever which is like really ask when's the optimal time to invest in a token project we concluded that it's probably 12 to 18 months after a token launches largely because you've gotten enough tokens vested in the market from the founders and from uh the original investors and there's enough Supply out there uh where you're getting like a reasonable price or at least a more fair price uh in the market and you also evaluate um whether the founders and teams have executed against that road road map or not so now I look at that and I say that's more of a crypto Centric problem which is how tokens are launched but also how vesting works it takes a very long time for Price Discovery so maybe the question is do a do you agree with what I'm saying and B what's the answer to that problem I think there's just a fundamental misalignment between Venture and public markets where Venture investors think long lockups are a good thing because they signal a alignment and it signals that you're in it for the long term the team's in it for the long term and if you're a public market investor you see low float High FTV you're going to be selling this thing for six years uh and like that disconnect is really tough and right now like we are seeing the projects that rais money in 2021 2022 uh in that like Peak hype cycle go and like have tge uh and like this disconnect is becoming more apparent now because you had these inflated 2021 valuations with long lockups and the public markets are just not buying it they're saying I I'm not I'm not in I will wait and you know maybe once you're done with your lock up I'll be interested uh so I think Time Heals this I don't know if anything else can there's there's simply no liquidity entering the market I mean the thing I track the most is stabin Supply and that's been fairly muted so as long as that continues to persist there's no demand for tokens any interest from retail is gone to meme coins uh particularly enabled by you know salana and so the whips of the world are attracting the line share of the liquidity and candidly so I mean I think the meta really just changed where people are not buying filecoin people not buying these but back then they would now and you could argue like what's changed because there were mem coins back then it's just more I think the ease by which you do it um using something like Phantom like mobile has become a big part now this cycle um something like Jupiter really like it salana really has allowed retail to express their views on chain whereas before was it was much more difficult in Prior Cycles so why would you buy a high FTV unlocking token when you can go and buy a meme coin and I and I think retail really appreciates that T I heard you on a podcast recently where you talked about sana's Cliff lest and how that might be potential alternative to this linear vest that people do how do you sort of think about that maybe you can talk about why salana might have done that when they launched in 2020 and why that might have led to some of sort of the traction they got from a community perspective oh yeah this is a fun story uh so I remember when Ana called me and he said everyone else is doing these extended vestes vesting periods and I don't want to do that I just want to do one cliff and get it behind us and move on and my initial reaction is you're crazy uh no one does it this way like why are you trying to be different uh but he explained his logic he really wanted to have real price Discovery uh and he was like I I want if people want to sell they should sell and if people want to buy they should buy and we'll see what the price is so they set up a 9month cliff from tge I remember tge was like April and then the cliff was in January the in in 2021 and I don't know if you remember what the Twitter timeline was like going into that unlock this was like Peak eth Maxi fud on Soul about how the circulating Supply was going to explode and the price was going to crash but as it turned out uh having price Discovery and having the tokens out there and giving the market certainty about what uh the supply is really worked also we got lucky on timing right like that unlock happened at exactly the right time and you know I don't want to underplay the amount of uh role that luck played but what are the lessons we can learn from that I think the lessons we can learn from that are one public markets want you to get the float out there uh you know we run a big Public Market hedge fund and one of the first things I look at is the float to FTV ratio and if that's a low ratio like I don't care what the number on the screen says this isn't a real price it doesn't matter so so I think public markets want your float to be out there to see what the real price is um and second I think Founders should feel um locked up because of ideological reasons not contractual reasons right like you want Founders who wouldn't sell other than you know for they need to like pay bills and stuff but they just so much believe in what they're doing that they're in it for the long term and you don't need a contract to know that so I think look for those types of Founders I mean the benefit of Salon is that they had a very healthy secondary market so a lot of those tokens were traded before that event um um and so that uh uh you could argue that teams that allow for that to have investors step in ahead of that and you know have an orderly price Discovery ahead of the unlock you place a lot of those tokens in hands that are willing to hold it for for longer is very healthy and and I think we should I mean I look at stable um secondary Market activity as a primary indicator of is it going to be a bullish unlock not a bullish unlock and most of the times when teams don't allow for transfers it creates a very disorderly um unlock whereas if you do allow them it it it actually is very muted after the fact and so um we should uh focus on secondary Market activity and and and and healthy secondary Market is a really good indicator I think for every uh you know one salana bullish unlock there's probably about a 100 down only you know uh destitution Zone unlocks and um I I do think you have to you know worry a little bit about a you know being a statutory underwriter if you're sub12 months in the US and and therefore um as a VC potentially looking at liability and two you know this is kind of a a tried and- true path for uh startups in traditional uh path right like you you know we mandate founder Investing For any single uh company that we really work to and if you don't have that you know similar to to to Locks like you generally don't have that same kind of alignment sometimes you find you know once in a generation founder like an toally like Raj and great you know inde dependent of what any sort of legal contract says they're going to be long-term align and holding but again I think that's that's that's rare to find and um I also think it's rare to find that in investors that are going to have that conviction that are going to be you know with you for the long term I think um I think in some ways the crypto public markets is like it's almost like a you know bizarre world version of what the US equities markets would look like and if uh you know the IPO Market looked up and and um I I think you know in traditional Venture uh funds are not returning any DPI they're not going out to raise you know new fund managers from kind of that 2020 vintage are are basically totally screwed and um you know I think in crypto obviously the the process of launching a token is not nearly as arduous as as um going through an IPO which I think is actually good um but the downside is you get this much greater dispersion in terms of um outcomes because you don't have those sort of not guarantees but at least um some sort of level of of of quality um when you know people are actually coming in and buying a token I think going back to the topic that what will fix this broken Market issue one is for the token to really be more linked with the success of the project which is something that we have not seen um in many projects and even right now for let's say ethereum the biggest debate is always that does the success of ethereum as a technology and platform equate to success of e as an investment as an asset and then if we are asking ourself about this same question to Eve this is a more bigger question for almost every other crypto startups out there with a token and obviously we know the regulatory issue that's preventing this from happening but I think if project are a lot more serious about linking the relationship of the token and the success of the project I think this will in some way change the broken token market and I think one issue is also good discussion is we all investing in growth in crypto so what do you think about like protocols that still have a lot of growth potential ahead but they should return some value to token holder via buyback or just outright distribution so to keep the relationship stronger because in traditional Finance they don't have to do that because you know the shareholder right right exists legally but in token there's no legal rights so you are basically only believe in the relationship if you get a cold heart distribution in like cash or whatever form of the revenue so I I think that's kind of the key issue that need to be fixed if we do not get the capital imbalances between private market and public market fix yeah so your question is should token projects return Capital to the Token in some shape or form right yeah yeah I mean I'll take a shot at this and then maybe we can kind of go around but um like intellectually I'm I'm like opposed to that idea CU these are like startups and like we never asked Amazon or apple or whatever to give Capital back in like the 90s and 2000s right Apple only started giving you know doing share BuyBacks and dividends in like the late 2000s after like icon showed up and told Tim Cook you got to do something um so to like ask these projects to return Capital back that's kind of like taking away from Capital they can keep internally and reinvest in things and building more useful things especially if it's a great team like that's what I intellectually believe but more operationally or just sort of like realistically um at least in my on our team what we say is like who's the next buyer for this token and often times it's like well we have to believe retail is going to have interest in this token but we also have to believe that's going to drive the token to like a top 10 top five token at some point that trafi will come in and buy it one day but even to get retails interest you need something you need a natural buyer and in this market it seems like the natural buyer is the protocol itself doing a buyback to support the price right so I'm like kind of torn between the two things what you think I'll take the other side of that I think token should absolutely be uh or team should absolutely be trying to drive value back to the Token uh from the beginning uh even if they could reinvest that in growth I think the way to solve that is have some of that cash flow go to buy and burn the token but have a variable issuance rate so you can actually issue more tokens to stimulate the growth but show Capital markets from the beginning that you are serious about sharing the value with token holders and show that cash flow flowing back through a burn mint equilibrium or some other burn mechanism or distribution whatever the mechanism I don't care what it is um but I think set the price I mean you're the pioneer of burn and mint and it's one of the most complicated token designs I can come across I mean do like this such a complex idea do you think most people would understand how it all works or they just understand price go up I feel like this is the IQ chart meme right where uh someone on the left and on the right is like this is great and someone in the middle who's doesn't love it I I think it's pretty simple it's you have an emission amount of tokens you have a tokens being burned if you have more emissions than burns the price goes down and and if you have more burn than emissions the price goes up and like that's about as far as most people need to think I do think uh you know on the margin the amount of overall you know Burns for someone like maker for example that does actively obviously uh buy back its own token is pretty small compared to you know the overall uh float of the asset and and volume for the asset uh as well I think you make a good point though around being able to M new tokens and use that to kind of Finance the the project this is something that we just have not really seen done um recently and I think this is part of the reason uh why there's such a you know Capital allocation mismatch between public and private markets if if uh you're traditional company and you're issuing Equity you can you know authorize issue new shares sell those in order to raise new capital from the public markets that process is extremely complicated or maybe even impossible in in in crypto public markets um and that's why we see teams go through these convoluted treasury sales try to hit up VCS sell these big discounts in theory these teams should be able to issue new tokens sell them on the market use that to recapitalize themselves um but we haven't seen that and I think that's you know again a byproduct of kind of the the regulatory environment um um in the US is a lot of teams just don't want to touch that with a with a 10-ft pole but um I think that would obviously help normalize these markets and sort of um you know I I think the market tends to be pretty smart and and sort of respond to the right incentives and right now there's isn't enough incentive to um tap into the public markets which I think is causing this sort of weird bifurcation maybe to like switch gears a little bit um there was a Twitter post expost whatever that went viral recently around quite quitting or Founders and teams quiet quitting and I'm sure we all talk to different Founders different teams all the time curious to hear about how prevalent you think this is how much of a big how much of a problem this is and maybe then we can talk about what do you do if you see that happen a lot yeah it's definitely I think there's a very big difference between skeptical and cynical um the longer you stay in crypto the higher the probability that you become cynical uh or you become a Bitcoin maximalist again uh because you see a lot of nonsense in the space uh you see not very competent teams get away with stuff and then you see the teams that are trying to really do good stuff and hard work be totally overlooked um you know there is an element of the best tech sometimes doesn't always win uh distribution matters a lot it's a very retail attention driven market so you have to play the game but um yeah I mean you see it every cycle I I don't I don't think today is any different than what it was you know back in 2017 um um you know it's uh it's just the way naturally like you know survival of the fit is like 99% of teams are you know mediocre and not going to survive and and crypto is is very difficult I think what my appreciation is um building in the open building in crypto is introduces a layer of complex for Founders that because you have a token if the token is going up people are like you know obviously you know that's your job if the token goes down they blame it on the founder and so Kane the founder of synthetics is a great line says look if you haven't been called a scammer you're not trying hard enough and and I think so so I think you you can kind of try to piece together why people are quitting uh one it's it's not easy to build again but uh I I would emphasize that it's it's it's not different this cycle uh it just it's a natural kind of state of startups and most end up failing um so yeah I think this exact same phenomenon that happened in 2019 but no one wrote posts about it or called it quiet quitting but yeah people naturally respond to incentives and um if there's um not momentum if there's not Capital if there's not um really an opportunity for new talent to come into the space and feel like they can build something and have a great outcome I think they're just not going to and people are going to leave and I think a lot of the people I met um when I when I got into the space in 2017 who left in 2019 they never ended up coming back and um I think that that's uh I I I I empathize with that decision and that if you're a new entrepreneur and you think about where do I want to be spending my time you you look at crypto uh people are going to make fun of you uh you know someone might try to throw you in jail or or hit you with a absurd lawsuit and um I think it's just it's really unfortunate that um you know uh the government can have such a negative impact and ultimately I don't think it deters or changes the destination of of where the technology is going but it can greatly kind of slow it down and I don't think growth is um you know something that's guaranteed or we sort of take for granted you can see how uh you know really negative regulatory environment can Tamp out Innovation and sort of kill companies we kind of saw that in the EU and um I'm I'm worried that that's kind of happening this time around where um at a certain point the momentum kind of starts to go go backwards I think a big part is we haven't seen big breakout new use cases and and anyone who has spent more than five years in this industry was hoping for a shorter time frame for us to heat mainstream adoption in like some use cases and I think a lot of us a lot of people came in with very high hope last cycle and it didn't deliver against their expect expectations so this quiet quitting thing has been more prevalent and I think it's also possible that um the industry in the short term how kind of hit is cap in terms of how much capital and talent it can accommodate for the use case is make the most sense and I think that we just have to accept that um the industry might not be worth like 10 trillion in the short term but we will get there and it's just like a short-term adjustment that industry will make I I also think there's a realization amongst investors and teams that value will be more concentrated at the top than we might have expected in 2021 or 2022 and I think that leads to some of this uh quiet quitting or just general disillusionment amongst a lot of people because people like to win right and when it feels like the Giants are just going to own everything and you're going to be a small Cog because it's so hard to to make money in crypto uh like I I think one of the big things that blockchains do is they destroy margins your margins go down Everything is permissionless Everything is open source it's really hard to defend your margins and that's why I think uh when founders start out they don't necessarily think about the longer term margin defensibility they're not thinking about longer term competitive landscape but then when they're faced with that reality and they see you know I'm going to be you know one of a thousand projects that you know is on whatever page of coin gecko not on the first page right like it's discouraging uh as to what we do when we see someone Qui quitting we sell or we write it to zero that's about all we you can't make someone do work say I would argue the premise that like it's it's really hard to make money in crypto I mean you you have incredible distribution attention and you know you have businesses like pump. fun whether you like the business model or not that is just a cash flowing machine and so if you're a builder if it's your first cycle or you know you've been here for many cycles I I would argue that you look at that and you can only be inspired by that type of scale that you were able to get in this industry now the question around retention is a good one which is how do you m maintain that uh flywheel going and attention and you know fees uh but I don't think that that is like the reason why people are are are quiet or soft quitting I guess the question is would you say that most people are quitting are those Founders that came this cycle are they Founders that have been around for a long time is it particularly more pronounced in an area like defi that's been kind of Left for Dead um I'm just kind of curious as you look through your portfolio is it is it kind of more acute in one area versus the other was since you brought up pumped off fund maybe I wanted to touch on that real quick you probably believe pumped off fund's a great product great for Sal right well disclosure I'm an investor so you are okay well what do you think is is pump out fund net positive for Salon over the long run yes absolutely uh because now there are all these people with salana wallets that previously did not have salana wallets yeah and that's the number one metric that matters is the number of people who have funded Wallets on your chain I think that's the most important metric for demand side for a blockchain ecosystem and the most important metric on the supply side is developers building unique things none of this copy pasta oh you know we're borrowing this concept from old ethereum L1 and putting it over here that you know that that I don't think counts I think that's a more valuable uh Insight on the supply side is you need unique teams uh is pumped fun unique I think so I think they found some unique uh gaming mechanics and they're very transparent about what the product is they're not it it's it's not like they're trying to promise you oh yeah this meme coin is going to cure cancer or this thing is going to create zero knowledge proofs that change the world or you know this is layer 45 scaling right like they're like no this is fun guess what's going to be popular I mean Las maau like we don't seem to criticize those particular Industries entertainment as much as you know memes but it's it's a same expression yeah I think people really appreciate the directness and transparency of something like a meme coin you know that you're it's gambling you know the casino you know the rules and there's something about that when the rules are very clear and the game is very clear people tend to like that and when it's not then you know you get you get uh the disappointment well one one thing I'd add just real quick I think the reason why people like meme coins is uh more institutional Traders don't have an advantage because the whole game on Meme coins is guess what's going to be popular and like I don't know I can't speak for all you but like I have no idea what's going to be popular right uh so I think retail is playing against each other in meme coins whereas I do think I can underwrite a token project better than most retail uh so I think I have an edge there so I think that leads to the rise of mcoins well the only counter argument against this would be um how do we tell the Boomers this is what crypto is being used for right like the question I often get from again the Boomers is um whoa salana is doing really well what's going on there what's interesting and I'm like oh this is awesome Casino called pumped off fun and that's it really but I don't know if you ever answer that question or how do you how you answer that uh I think we are stress testing the rails for Defi and what I hope to ultimately see and the reason why I'm in the industry is I think these are the right rails for financial system to run around the world but that's not going to happen overnight we need to see lots of activity we need to see money we need to see all the break right and we've seen that happen because of the pressures from these beam coins and this trading activity so I think that's what's exciting I'll take a more PE view of that you know what what really drove the some of the advancements in adoption of the internet it was the born industry and you know there's people that don't like that there's people that have a problem with that but at the end of the day you know it's um you know when you think about crypto I think as an industry we really feel this need to be very defensive because you either love crypto or you hate it it's very bipolar so when you go and talk to people Trad in traditional markets you know um you you most of the times become defensive to try to justify the existence of this industry so putting Bitcoin aside um I don't have any problem now telling people that this is a a casino uh that there is a hyperf financialization happening and and I think the more that we understand and accept that I think we're better off as an industry we don't need to be defensive we don't need to justify that we are specul speculation drives Innovation it's really hard to predict how this technology much like the internet is going to be used no one could have predicted that they didn't do it in 2001 with the internet they're not going to do it here but to two shar's point I think I think there's something really powerful about tokenizing attention about allowing anyone to be a market maker or provide liquidity to earn fees for that consumer preference to really um to really have like transformational business models like we haven't even talked about deep in but fundament mentally I think all of these different iterations are are opening up and capturing the imagination of people of what it means to have to be an owner in a network to participate in the upside and I think that really transforms the relationship that people have and how they think about um you know acre value for their contributions and if you're not excited about that then you should go do something else and that's totally fine you'll come back in 10 years yeah I I think you guys decided well I think um the only thing that actually like irks me is when um I think people try to intellectualize uh meme coins and then tell me tell me a greater story it's almost like uh you know being being very literal and heads up about it I think is almost more noble and you know what I don't think there's anything wrong with uh having porn on the Internet or you know Meme coins on chain makes sense maybe to switch gears a little bit um what do you guys think about the US election it's the thing it's a question I get a lot when I meet people um someone you know there like this institutional crypto manager survey that maybe a bunch of us take part in one of the questions is like what do you think the market will do if Trump wins what do you think the market will do if commo wins it's basically people generally think Market goes up 30% if Trump wins commo wins Mark's down 30 right that's where like people believe or at least say they believe uh the world's going to shape up so how are you guys managing risk or how are you even thinking about this election we were joking ahead of time that uh inventure you you don't manage risk you know you know it's a little bit of the same old and we're kind of just deploying and trying to find teams and I think um you know obviously trying to find good opportunities in the market but I think um if anything the election is bullish I think base case Harris wins and we're sort of where we are right now right I think you know GOP still takes the Senate and I just don't think there's going to be any momentum or any sort of movement when it comes to regulation in the US you know best case and and you get a more you know favorable um uh office I think um great you know that's that's only sort of uh uh you know bullish for the industry and so um I really don't think it's it's it's harder to get worse than where we are right now and I think um that's going to be sort of the the the you know stagnant uh nature of of sort of a post elction us I don't think it matters candidly it very marginally um I think what is most important is you I think we've peaked in terms of when you think about the evolution of crypto um the hostility sort of like 2012 it wasn't important it was too small no one really cared and then and then as as more value started to be created you know there was more attention and then that my argument is that we've sort of peaked on the level of um regulatory uh hostility towards the industry um and it happened right before the ETF was approved um I I think we go down from there now the I think there's two different ways that that line and that progression happens in what administration it sounds like you know it would would be much faster than that whereas the other it may still be things don't change much but the level of hostility I think um is is is is not going to persist to that degree for the simple reason that you have an ETF and and I think Wall Street for the first time is able to make money off of this industry and that is pretty important when it comes to how we think about just the existence of this industry and the justification of having regulatory Clarity like policymaking like we we need guidelines that's the most important thing and there these things certainly take time um and and to work their way through Congress and be socialized within the different committees and in many ways you know I used to think that it would be we needed them like five years ago we need them three years ago but if you look at you know how the music industry was regulated at the event of like things like Spotify it these things take time and and we in many ways I'm glad we haven't really cryst ize them I think it's time now to do that and I think someone like Larry thinkink and you know the Wall Street kind of apparatus really kind of pushes uh pushes pushes us closer to that uh hopefully it happens within this Administration but I don't think uh as I said I think we've peaked and so it's largely irrelevant who wins in my mind to your point if someone told me in 2020 that a presidential candidate was going to launch a defi protocol I mean I wouldn't have believed it right exactly I yeah I I think from a practical shortterm perspective it is very important and most manager I think will lower their net exposure going into the election unless you're like the very long-term kind of strategy because I think crypto has never been so intertwined with politics before so this is a new development and Market wouldn't be very certain on how to make make of the impact from a short-term perspective so it I think yeah you are going to see a Delta of 20% in crypto market cap as a result of who is become the next president that's on a short-term uh price action and I actually think the longterm impact is even bigger but that's what not what the market in short term are able to figure out but in short term I think the difference is 20% market cap in the long term I think it matters even more I think I think one thing a lot of crypto native don't realize because we are generally more libertarian we don't try to play the politics side is the industry have gotten big enough to impact like National like security and all the other stuff that even normal people will care about already and this is something new to us and politics start to matter and actually you look at every other industry when they were small the government doesn't care about them but when you get a certain size you always need to do with politics and let's look at tech industry in China and us I mean when you hit a certain level politics is actually matter for the next level of growth and I think crypto is close to that level already so I actually think the long-term implication is more than a short-term 10 20% swing in the market but I'm going put you on the spot since you mentioned a percentage swing so commo wins tomorrow Market's down 20% are you a buyer um depends on who should appoint as the next secc president so you need to see like the candidate choice for all this kind of you know members she appoint right yeah if she turn out to be not as hostile then yeah we buy I'm definitely a buyer like look at all the what what makes a democracy great is the judicial like the checks and balances of power every single court case of crypto the major ones have ruled in favor of this industry don't forget that I I know but I think it doesn't matter because it's not feasible for every company to go and fight a lawsuit with s only a few company with the legal resource can Master this fight most company are going to settle and you're not going to get a very favorable result it's not practical to go for lwuit with the government on every cases yeah I I'm more with Arthur on this I think it does matter but I don't think it's a death blow or anything like that I do think that having a friendlier Administration will enable more experimentation and new business models and it'll accelerate at Innovation or we kind of stick with the current pace of innovation uh because that that's a status quo right now we have a very hostile Administration and a continuation like won't kill the industry uh but what I'm looking forward to is hopefully seeing an acceleration due to a more permissive regulatory structure I do think we need to separate the word crypto here into two components I think Bitcoin is separate I think it doesn't matter which candidate wins Bitcoin is going to do well because both of them are going to blow up the bu the budget deficit no one has any plans to fix it no one is even going to try and we have to remember like what Bitcoin was created for is an escape hatch from the Fiat system uh so I don't think the election matters for Bitcoin at all I think we're talking about all the other assets and to your point I think I'm going to close with that someone sent me an estimate of each candidate's policies and how much it adds to the deficit I think kamla's number was 6 trillion and Trump was like seven so yeah that's your Bitcoin thesis right there well thank you I think that's our time thanks