Bubble or Revolution: The Future of Blockchain and Cryptocurreny - Aditya Agashe and Parth Detroja

all right i'll just leave this one here hi everyone thank you so much for coming out here today my name is adi and i'm here with parth and together we're the best-selling authors of bubblerevolution we're here to talk to you about the future of web 3 blockchain and cryptocurrencies a little bit about us i was a product manager at microsoft for four years part that facebook and we wrote bubbler revolution five years ago um to kind of dissect you you see crypto going through boom and bus cycles and we wanted to dissect what's real and what's not in this space and so what we're going to do here in this talk is we're going to show you some of those building blocks that you can help make predictions about the future now in the last year since we've quit our jobs we've been working on edtech startup and angel investing in different and advising different crypto startups along with startups and other spaces so hopefully some of this will be applicable the last time we did a talk like this was pre-covet at a blockchain conference in malta and we made a prediction there that that was in the peak bear market that actually ended up coming true uh two or three years ago this prediction was that china which notoriously has a negative stance on crypto has just banned bitcoin mining always has some of these harsh regulations oh are the slides not playing okay give us like one second the slides are relevant for this thank you no i still know if you have like hdmi we could go direct to the tv too no luck we can also send you the file if you have a laptop that works with it we can do it without the slides too we don't need the slides just keep doing it okay so we're just gonna roll without the slides that's okay so as i was saying we made a prediction there would be a nice pretty slide here of us presenting this uh you know two three years ago in malta and the prediction that we made then during peak bear market was that essentially china was going to be the first country to launch a cbdc uh we had been looking at the covert you know patent applications that china was filing china had just been added by the imf as a national as a global reserve currency and so what we wanted to show you was when we're making these predictions there are some building blocks that we have um some ways of thinking that help us you know make these predictions so in the first half we were going to teach you those and then the second half we're gonna make some brand new predictions uh about the future so uh when we think about this space uh you know one of the most fundamental things um when you think about a cryptocurrency one of the building blocks of web 3 is the question of what is money and this is a question that people have thought of for over 2 000 years aristotle was the first one who you know came up with a formal definition of what is money but the funny thing is you know i would have had a screenshot here of when you google what is money you actually get some really funny results you see the first result is uh money is the root of all evil which low-key might be facts but you see a lot of things like that you see money's evil money is everything and so uh this goes to show that this is a thought that people still 2000 years later are thinking about and so aristotle defined money with four key properties he said that money is durable it's portable it's divisible and it has some intrinsic store of value and so when you look at commodities like gold and silver which were used back then they hit all four of these metrics but modern money as you know fiat money it's not really durable if it's cash uh it doesn't have intrinsic value it's your faith in the us government for example with the usd um and similarly crypto has uh it meets three of those check boxes but there's nothing intrinsically backing it and so when you think about this space uh you know what you have to start thinking about is uh you know there are some fundamentals here but what how's this going to play out in the future if there's nothing intrinsically backing it and you see you know two sides of the coin um jamie dimon uh back in a few years ago made the quote that bitcoin is going to be you know a bigger bubble than tulips we have we had a little clip of him actually saying that uh live and then just a few years later jp morgan put a and fifty thousand dollar price target on bitcoin um and so these companies these influencers these leaders that we respect flip-flop on cryptocurrencies web 3 blockchain and so how do you actually know what's real and what's not in this space the analogy that we wanted to give was that right now web 3 is in the wild west it's kind of like the us during the free banking era in the mid 1800s what happened during that time was essentially banks could choose silver gold any other metals to back the us dollar and so a dollar would be backed by a different metal or a different amount of that metal depending on where you got it and so this created a lot of inconsistencies with trade and commerce but when the free banking act in 1863 came into effect we got the gold standard and what this did was it made sure banks had to keep a certain amount of gold for every single dollar in a vault and so now there was a guaranteed backing behind every dollar similarly right now in web 3 with uh you know all these different if you look at stable coins one of the core building blocks of web 3 you see fiat back coins you see crypto back coins you see different ways of collateralizing you see treasury models all of these are different ways which people are experimenting but there's still no gold standard for the right way to move forward and because of that we get volatility and volatility is the last thing you want in a currency and so to explain this more i'm going to hand it off to part to talk more about how a currency can get more stable so we can start building towards some of the predictions hey guys we were going to show you this really pretty slide of just kind of like a spectrum of currency stability ranging from the venezuelan boulevard to the usd um with the turkish lira and bitcoin kind of in the middle um like the adoption of uh cryptocurrency at like the national level really comes down to how stable your currency is like if you are a citizen in a country and you're using currency as a store of value for your life savings to like take care of your family you want to rest assured and sleep at night knowing that the purchasing power you have now is something that you'll retain and have in the future um if your life savings are invested in it and so looking on that spectrum from the boulevard to the us dollar with like bitcoin right here um the venezuelan boulevard had inflation of 1.3 million percent over the last few years um versus like the turkish lira declined about 38 last year but which is like pretty comparable to bitcoin but like it's even like even though that bitcoin has those sort of fluctuations over the course of a couple weeks the lira does that over the course of a year so it's still a bit more stable for countries to adopt uh bitcoin at the national level their currency has to be extremely volatile you see countries like el salvador um adopting bitcoin but it's not so much because it's so stable as it is that it can be for a developing country and being the first to do so it can bring a flux of um investment from crypto bulls um it makes you an immediate contender for hosting any crypto comp conference you want and much more um so our big prediction the reason we got invited to speak here was because in 2019 we successfully predicted that china would be the first major currency to tokenize um their currency and so our rationale for that prediction was essentially that a few things one china's china has 10-year goals that they publicly kind of announce and one of the big ones for the last decade was to be a reserve currency so there were previously four global reserve currencies the japanese yen the us dollar the euro and the british pound china as a growing economic powerhouse has been investing heavily in trying to become a reserve currency and in 2015 the international monetary fund actually made them an official reserve currency but the adoption of their currency for reserve holdings has been very low um single low single digit percentage however china accounts for about 27 of gdp growth year-over-year for the last five years um so it's obviously an economic powerhouse that wants even more influence on a global stage um one of the issues china faces is they've had a long history of deflating their currency to spur increased trade as the power of the yuan goes down and other currencies are more powerful because of it by tokenizing their currency we saw an opportunity for them to have more transparency at least perceive transparency and get more interest in holding them as a reserve currency um so that was our previous prediction um but now let's get into the exciting stuff what are our predictions we had a slide that we were going to show you which was like a screenshot from bloomberg in august of 2021 which was like a chart showing venture capital investment and crypto web 3 all of that fun stuff in august everyone is saying like oh my god it's like 17 billion to put things into perspective in 2020 um all the entire um crypto investment was around five bill by vcs by end of year it went from 17 in august to 31 billion dollars invested so obviously vcs are very excited investing in companies that could be the next microsoft or google but let's talk a bit about what microsoft and google are doing so we spent like 20 minutes just like digging around to see what we can find obviously for like publicly traded companies like this they're not just gonna put their roadmap on like google slides and share it out so a fun hack you can do if you're interested in learning what a company is up to go on there go on their employment sites look at their careers and look for director or higher level roles for new verticals so within like 20 minutes we were able to find that youtube is hiring a director of product management for youtube web3 and um microsoft is doing similarly um for biz dev for web3 and so you're probably thinking to yourself like these big tech companies are fundamentally web 2.0 like why would anybody trust them with web3 and like what chan what snowball's chance in hell do they actually have of finding like product market fit here well let's think about it from the perspective of youtube and um because they're hiring right now so think about if you are a youtube creator right now and you're not like a crypto influencer you're just a creator and you want to launch an nft um think about what that process is like for you okay you make some art you upload it to openc you then tell your followers hey like i know you came here to watch my videos but like if you could go on coinbase convert fiat to eth make a meta mask use that metamask on openc to buy my nft that would be amazing like think about the alternative from the perspective of youtube you can if you're actually hiring to create this vertical you can make a seamless consumption to commerce experience where you can just abstract away all of the crypto components if google was to give every one of their 1.8 billion users a crypto nft wallet just as part of your youtube account or part of your google account you have immediately just multiplied the crypto market overnight everything will be in a massive bull run and that's something that's going to happen very soon because that's the superpower of google they already have the accounts and they can abstract away the crypto and then if they actually want to take it to the next level and they want to push this initiative they can give a ranking boost to any creator who's using youtube's nft platform and then if you want to take it even further if you don't want your nfts to just be a form of art you want to make it a way for you to you as your fans have your fans invest in you as a creator financially you can then use youtube's powered nfts to do rev share of ads revenue generated so as long as you hold that nft you're just being paid a portion of all future revenue so there is a lot of potential opportunity for big tech in web 3. like as you guys all know facebook rebranded from facebook to meta this this wasn't something that just like happened overnight like a pr stunt like facebook very deliberately acquired oculus in 2014 and has been spending about two billion dollars every quarter investing in r d to have hands down in my opinion dollar for dollar the best ar vr experience and sense of presence it's debatable if facebook's virtual worlds will take off but in honesty they don't really have to like you can do the nvidia model where you're just selling the hardware if you have the best in class hardware like before the metaverse and web3 and all of these buzzwords are a thing facebook was working on making the text they have about a five year head start on this technology um and facebook isn't the only company that's interested in web 3 or the metaverse microsoft just spent almost 70 billion dollars to acquire activision king blizzard this gives them games like world of warcraft call of duty like if you think about gaming today and nfts like most of these games are like tamagotchi style like 2d games they're not fundamentally games they're nft projects with a gaming component but like microsoft now has an opportunity to fundamentally flip the model where you have first-in-class games that have made billions of dollars this ip that people have spent over a decade playing like call of duty to create world-class nft experiences so our prediction here is that web 2 companies especially big tech companies will actually play a meaningful role in web 3 and the metaverse and i'll give it to audi to talk about our next prediction sweet so for the next prediction we wanted to show you a trend of what's been happening for the last you know two years 2020 was the year of defy we saw unit swap in the summer launch and since then d5 tvl has been going through the roof in 2021 we saw nfts get volume hash mass and crypto punks in january and february launched and because of that you know the there was over 20 billion dollars in nfts traded all of last year and so as this starts to happen let's make a prediction of what will happen in 22 and 23.

and to understand that let's look at a fundamental core property of humans humans tend to prefer organization and that's a strong statement but let's look at what's happened throughout you know ancient history at first the smallest unit of governance was a family you look out for each other you make sure you survive you get food on the table metaphorically and so eventually you got families coming together they made tribes tribes made villages villages made cities the nations and people like this organization because it provides stability you have a certain set of rules people act in you have your basic needs catered for and so this has evolved in modern day we have organizations for companies we have non-profits we have governments but there's a funny meme i was going to show that shows how much we like organizations there's a funny you know meme that most of you probably have seen of like all the big five six tech companies and their organization charts you see oracle which is just a bunch of lawyers and then like a little bit engineering you see microsoft which has three orgs with like guns pointed at each other that's like the iconic meme and so we've liked organizations so much that we have such different ways of organizing together and yet all of these ways work we see all of these companies be you know at close to or surpassing a trillion dollar market cap now in the modern market and so what this all comes down to is that it doesn't matter how you organize it just needs to fit the the ecosystem that you're in and in web 3 that way of organizing is through dowse through decentralized autonomous organizations and we think that dows can also evolve to become dacs decentralize autonomous corporations we can see these organizations having actual legal entity llc or corporation that gets registered once once the dow is formed so that it's not just the community of people working you know in web 3. and so as this plays out let's take a look at you know what's actually happening uh with daos with dao's we saw this year uh towards the end of last year constitution dao raised close to 50 million dollars via juicebox to buy a copy one of the few copies of the us constitution and this was a great experiment which essentially showed that people an activist group of people will get together for a share cause in the span of a weekend raise a large amount of money and they'll be able to try to execute on that vision and so looking at juicebox which is the primary way of raising this money um the the tradify ways of doing this are through gofundme or kickstarter but recently they've been taking some heat in the news because they started banning certain projects from actually uh being able to raise money on there and whichever stance you side on on that political side whether you think it's ethically right or wrong for them to do it as long as they keep doing that people are going to move to uh it's risk management people are going to move to a platform that doesn't carry the risk of them getting banned and so as this starts to happen and people start to trust these dows which have a few leaders who are running them they're still shaping this vision we start to see dao's getting you know a bigger scope in the media sorry a bigger scope in web 3. and so our first prediction for this is that in the first 18 months the next 18 months or so we see uh dao forming a super pac a super pac is a political action committee and we think that you know the first most obvious use case here is for a dow to try to make crypto regulation uh easier this will start affecting the midterm elections it'll start affecting the president presidential election and then what people will start realizing is that you can make special interest doubts um it doesn't just need to be for crypto regulation it can be for uh you know tactical causes you believe in like if you want to make a dao about climate change you can do that and so in order for these dows to evolve to this next stage you need to solve the big problem of talent management you need to know what people have worked on in the past and so one of the companies that we're lucky to have angel invested in is called contribution labs it's a company that's solving this talent management problem by making it so that you can track ownership of work in web 3. they're taking off chain contributions and turning them into on-chain contributions using nfts acknowledgements and other projects that they're building and so given all of this tooling that's coming in uh you can now track your identity in web 3. so building on this vision now that you have these super pacs in the political scene you can also see corporations so you can also see dao's investing in corporations we think that a dow just like gme saw a populist group of investors come in and take abort and and treat gme not as a discounted cash flow like a traditional uh investment they saw it as a venture investment we can see a dow coming in going to a twitter or robin hood where they haven't been focusing on crypto as the main narrative and they can go and try to uh you know change that and they can raise a lot of money to make that you know a primary objective of the company and uh i can hand it off to parth for you know a last step on this to build on this vision yeah so our final prediction is that we see like a big trend we saw in 2021 was that the emergence of spax or these blank check companies the problem with spax traditional spax is you raise a bunch of money and they'll try to uh bring a private company public but if that doesn't work out you it's just a general theme and you're just going down your list of like trying to find a company that you can take private to take a private to public we see that as like kind of a broken system the idea of spacks of bringing a private company public and like raising funds to do so is great but like you need to be much more deliberate and that's not possible with spax so our big prediction today is that we see in the next 24 months that a major private company dao will come in raise money to bring a company public through a spacking out of sorts and what's great about daos is through the smart contract if you can't get the company you want at like terms that are acceptable to everyone part of the dow they can be contractually just returned all of their money in a seamless way which is not really possible with spax today my name is pratha treja this is audio we are the best-selling authors of bubblerevolution thank you so