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HEALTH, WEALTH, AND HAPPINESS |
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| "Be careful to leave your children well instructed rather than rich, for the hopes of the instructed are better than the wealth of the ignorant." - Epictetus |
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| New Investor Scorecard: Algorand (ALGO) is the Layer-1 blockchain that promises to improve on other blockchain shortcomings: it's low-cost, fast, and environmentally friendly.
But is ALGO a good investment?
Download our new Investor Scorecard and get our analyst insights on long-term investing in ALGO.
(If you're not a paid member, become a Blockchain Believer to get instant access to our entire library of crypto scorecards.) |
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| Toys, Secrets, and Cycles: Lessons from the 2000s (Chris Dixon): One of our smartest technology investors, a16z's Chris Dixon shared this terrific post that parallels the development of user-generated Web2 and today's crypto-fueled Web3.
Worth reading in its entirety, here are a few of his key ideas: - Financial downturns (such as the dot-com crash of 2000 and the financial crisis of 2008) are when the next generation of tech companies often flourish. (See chart below.)
- World-changing technology usually starts out looking like "toys," until they end up transforming business and commerce. (Think crypto, NFTs, and so on.)
- To predict what's next, observe what smart people talk about over dinner, or do in their free time. (If you don't know smart people, get thee to a Meetup and network.)
Investor takeaway: The same creative patterns that happened in the 2000s live on today... you just need to know where to look. My belief is that the best place to look is crypto and Web3." |
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Dixon starts his post by reminding us how many people were writing off the Internet in the early 2000s (just as it's fashionable for the media to write off crypto now): |
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| Actual headline from Dec 2000 (courtesy Greg Leffel)
Then Dixon points out how the various financial crises planted the seeds for today's largest technology companies: |
| Courtesy Chris Dixon
Investor takeaway: Dixon points out that the companies that survived and thrived during the downturns were companies that preserved capital and stayed focused on their long-term vision.
In other words, look for crypto companies during this time that spend money wisely and keep their focus. |
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Hi everyone,
There's no shortage of stuff to write about today as bitcoin continues to test support at $20,000 per coin. The market has gone from excessive liquidity to extreme liquidations.
This morning, one of those liquidations went public in a most peculiar way...
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| Bitcoin Jesus, of course, refers to a man named Roger Ver, who earned the nickname by being a very diehard bitcoin OG. He was later re-nicknamed Bitcoin Judas after throwing his full weight behind Bitcoin Cash, a failed bitcoin offshoot, in 2017. I guess "Jesus" makes for better headlines.
A 2013 video of Roger has been circulating lately in which he assured investors that Mt. Gox wasn't having any liquidity issues just before it went under.
There's a lot of he said, she said stuff going on, but the short of it is that Ver had a very large leveraged position at CoinFlex with insufficient collateral. Rather than closing his position for some reason, they left it open and it's now in deep-red territory. Last week, CoinFlex became the latest crypto exchange to implement a total withdrawal freeze due to liquidity issues, apparently tied to this single position.
Just yesterday CoinFlex CEO Mark Lamb was on Bloomberg TV shilling a new token they've launched called rvUSD in order to raise the $47 million from the general crypto public. Bloomberg's Sonali Basak put the screws to Lamb asking why anyone would want to invest in this new token to make an (at the time) unnamed investor whole. I suppose that question goes double now that we know who the delinquent is. |
Sam Backstop Fried
Our deepest regrets go out to anyone who had their coins on CoinFlex, Celsius Network, Babel Finance, or Finbox, to name a few of the centralized crypto companies to freeze withdrawals lately. According to one of the richest men in crypto, there may be more collapses coming. |
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| Sam Bankman Fried, also known as SBF, has stepped in to backstop a lot of the fallout from the current bear market, reportedly providing credit lines of $750 million to distressed crypto companies so far. Some have gone so far as to compare him to the Federal Reserve of Crypto.
You may recall how in 2008, large financial institutions received massive bailouts from the government because they were deemed "too big to fail." For obvious reasons, no government seems ready to backstop the crypto industry. Instead, they're trying to crack down and create stricter regulations. So SBF is taking on this role. "We're willing to do a somewhat bad deal here, if that's what it takes to sort of stabilize things and protect customers,” he was quoted as saying.
Still, I'm not so sure that he's getting any bad deals lately. Perhaps they seem bad on paper because the markets are so low right now, but I do believe that over time they'll prove to be extremely wise investments by a skilled capitalist. |
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| Best regards,
Mati Greenspan Analysis, Advisory, Money Management |
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Eventually, they'll evolve. |
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| Bitcoin Market Journal is a daily newsletter that makes you a better crypto investor. It is created by Evamarie Augustine, Charles Bovaird, Mati Greenspan, John Hargrave, and Alexandre Lores.
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