The discussion offers a decent entry-level comparison of consensus philosophies, but it struggles to move past basic definitions into meaningful technical critique. It ultimately feels like a speculative price forecast thinly veiled in academic terminology.
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XRP Heavyweights Talk Price ShockAdded:
Um, >> vent, is this accurate to say with regards to Bitcoin that when we're talking about consensus, like this topic in Bitcoin, they compete for a reward that allows them to achieve consensus by allowing the winner to determine the transaction order. Is that the dictator of the moment thing?
>> Yeah, that's the dictator of the moment thing. So you compete for the reward and the winner of the reward gets the monetary incentive and they determine the transaction order. Correct.
>> Correct.
>> Correct.
>> And and that that's incentivization, right? Like in Satoshi's mind, it was like, hey, we need transaction ordering. Okay. That's very important for solving the double spend problem. That's what he pioneered.
We need transaction ordering, >> which is what David explained in the tweet above.
>> Right? So you need global transaction ordering. That's a must. That's what validators, miners, whatever blockchain you you pick basically do. You need global transaction ordering. Once you once you have that, you can move forward. So in his mind was okay, we need global transaction ordering, but how can I and this this is the difference where we go in let's say the Satoshi model is okay, I'm going to pay people, incentivize them to do the transaction ordering, right? So in the case of Bitcoin, you say, "Hey, if you do the transaction ordering for me, you know, then you're going to get a reward.
You get the so you get tokens, you get the fees, and uh so you you let them work for you." Okay, that's what a lot of Bitcoiners um like also to say, like the miners work for them, for the network. They work for us. Uh we we pay them the the rewards, the incentives, and they work for us by doing the ordering, by doing this this work. But it turns out that you don't need actually to pay people to do that.
That's sort of where the natural incentives come into place because if you have people who benefit from the XRP ledger or from any blockchain, they're happy to do the transaction ordering together so that they can have a functioning system, right? It's like if you have a village, everybody is incentivized to not [ __ ] you know, in the village, okay? You're going to [ __ ] outside because you all live in the same place. So you don't need to pay people to not [ __ ] in the village basically. Um so some people pay people to not [ __ ] in a village. Other people say you know what I think people are naturally incentivized to not [ __ ] in the village.
They're going to go into the woods or whatever to [ __ ] That's where we differentiate. But the most important thing is don't [ __ ] in the village.
Basically that you you you need global transaction ordering. That's what all them need and they solve it in a different way. And that's why I believe by the way that they they are not necessarily really because people say like whether they you know created Bitcoin and things like that or part of it the crew for because for me it's more of a reverse engineering you know you saw what Satoshi is doing okay amazing pioneered and then you reverse engineer you say okay what is the secret sauce oh okay the global transaction ordering all these things these pieces and then you just do the same thing but differently it's it's reverse engineered And I I'm not sure if you reverse engineer your own work if if you created it in the first place.
>> So yeah, you you've made that point before. Is it it it's a reverse engineer like or is it just you taking some of it and leaving some of it?
Because if if you if if I would say what would be the logical not logical but sort of successor of proof of work or something like this, you could you could argue proof of stake. You could say proof of stake is uh is a successor uh of it because it has also the same incentive model um and and all these things, but it's just cheaper. Why is it incorrect to to view it the way I do where it's like >> two it it's just two ways to solve >> the problem cooperatively or competitively and it's not one after the other even though time-wise it became one after the other but not really because the idea goes back to fugger >> right >> so to me it's more just it's it's like the very simple analogy. I think I've made it in the past where it's like you just have two like two groups of people and each group you have to put forward the best widget and you either all compete and then use the best widget.
The winner is the one you put forward or you all work together on one widget and put it forward.
Two valid ways to solve the problem.
I don't see it. Maybe it's just that I I'm not technical and I don't understand what you mean by reverse.
>> I don't I don't think I don't think it's uh it is uh rooted in in pure technical.
It's more of a philosophy. Right. So if you think someone who created uh Bitcoin or uh the group created Bitcoin with all the structure, all the mechanics that we typically talk about in these spaces um could make the step forward to say okay we we do like collaborative or do the XRP up. that that's a lo that's a logical argument like I there's nothing wrong with it. I just wouldn't go that way. You know, it's like for me it would make sense the other way around that they are not um the same group but they reverse engineered sort of oh we saw this Bitcoin is amazing. Uh what is actually what makes Bitcoin amazing? You know, you I I think now >> Yeah. You think David made like one of um this this great analogy in one of his >> uh panel talks where he said, "Imagine this. You you find like an alien artifact or something like like alien technology piece and it does like amazing things, whatever." And the first thing that people would do is like let's tear it apart and and see like what is what is the special thing here? Like what did they do to make this? So you tear it apart and you hope you find that secret alien technology that makes it actually so so brilliant. Um and that's that's sort of the approach I would also think >> and so that discovery that they made like what actually made Bitcoin special was that it reached consensus in a decentralized manner.
>> Yeah. And that is not proof of work, right? Like some Bitcoin would say proof of work is like the secrets is this is the anal alien technology basically >> right >> yeah David would say no it's not the proof of work part that that is that is not what >> so that's so critical what he's I guess what he's saying is like proof of work is this is what we were what I was yelling at Schultzy yesterday about the proof of work is one road to towards decentralized consensus but decentralized consensus is is I guess that's the breakthrough, right?
That's the that's the Satoshi. If you want to give him an invention, that's the invention. I get is that right?
>> No.
>> Or is that >> No, I see I'm confusing myself.
>> Proof of work is not a Satoshi invention because that's Yeah. Yeah.
>> So, right. And so the the one invention is something else which is not part of this conversation. It's the difficulty.
Is is it do you remember that vet?
What's what >> scam difficulty adjustment is also uh Adam by the way >> really what's the one thing do you remember how scam or maybe you just know the like they say that Satoshi just put pieces together >> but then there was something that was actually new that he did >> yeah he in his paper I I'm I'm not uh like I'm not sure exactly >> wasn't it double spend >> double spend yeah he solved that I think it was because of the the the global transaction ordering. Um but even even the proof of work by the way from Adam that you mentioned there's a post by Adam uh where he said Satoshi took uh his hash that's what it's called um proof of work um and made some changes to it or so it was not a onetoone he made some changes to it some of the things that Adam felt like weren't great but Satoshi you know thought that they're really great for the way that he like for Bitcoin in that sense so he didn't take like one to one what what he what he did, >> right?
>> Um, >> forked it.
>> But the pieces he put together per the interweb cryptography.
Sorry, got a phone call. Stupid Blackberries. Got cryptography, P2P networking, proof of work, and digital signatures.
The new addition, the secret sauce, the internet calls it, the Nakamoto consensus, redundant peer review, difficulty adjustment, and the incentive structure.
>> Okay, there you go. The the the difficulty adjustment. Yeah, that means I got it right yesterday.
Thank heavens.
>> Yeah. Yeah.
>> I mean that I mean all these pieces, you know, he took he changed a little bit.
So it's not just it's one of course um or multiple pieces that that u Mr. I was talking about but even like the other things that he was citing in his paper um giving credit back to the to originators like Adam he he um forked them you know he made like some changes to it's like it's not the one to one copy either it makes sense you know because you you have that such you have such a great ability to bootstrap with the mining you know it makes to me it makes sense that that would be first and so you're saying that the XRP crew just were exposed to what Satoshi did uh pulled it apart, found out what was, you know, most important and made changes of their own.
And that's what you mean by reverse engineered.
>> That that's what I meant with reverse.
That's why I never personally never entertained the idea that >> it's very valid and I feel like I understand it now more than I did.
>> Yeah. Yeah, but but your point also made sense for me like because it's not rooted in technology, right? It's not like exactly black and white. It's it's more a philos philosophical approach like if you think >> you could go either way, you know, it's like >> it's it's also straight out of Lost for anybody who's watched Lost.
>> Yeah. Um, it's, you know, the man in black and Jacob ha have a conversation about, you know, it's well anyway that that that's a bigger rabbit hole, but it's sort of Yeah. It's it's two it's like basically two philosophical approaches to a problem.
Correct. Yeah. And, you know, if you go to the proof ofstake crew, you know, they they took their their approach. I I would argue that approach is more in line with with the Bitcoin crew sort of right like you you >> because of the incentives of course right no >> not because of the incentives they also kept the uh dictator of the moment uh part >> and um same lottery system basically um and the only thing that they changed is what they changed is how they did do the lottery because what I mean with lottery is you have like all these minor ers and it's a it's a literally a lottery by probability who you give to the block, right? Like who is going to be the block leader >> and on on Bitcoin that's your probability increases with um with mining with hash power. Mhm.
>> So the more hash power you have the the bigger the probability that you win in this lottery. And on proof of stake same same you know same logic but the only thing is not hash power that decides it is it's token stake. So the more tokens you have the higher the probability like sort of the the lottery >> that you win the lottery.
>> Yeah. Yeah, that that's for that's why I said like for me in mental model proof of stake is is a is would be a nice successor thinking um of of proof of stake.
>> I see what you mean. Yeah, >> makes total sense.
>> Yeah, >> that's really well well done also.
>> And so in exchange so obviously proof of stake and proof of work both have the incentive and competition over the incentive or the reward.
And on XRP there's the absence of that.
And so like it's just instead of competing for a reward, we get rid of the reward and we just agree.
Yes.
But you need to need you need maybe competition if you try to distribute a token you know because imagine this you you have token uh let's say you have 21 million of whatever token let's say bitcoin and you say okay I want people to take this bitcoin like your goal is you want people to take this bitcoin but you wanted not that people just show up you know and just grab a bunch and go away um or sell whatever you want them you wanted to make it as hard as possible uh but as fair as possible at the same time for them to get it you know to get these tokens and for bitcoin it's like you you need to spin up mining equipment and with uh proof of stake is you need sort of to get you get some tokens first started right and then accumulate and then you have like this this competition with people.
I I find this whole topic fascinating in how simple it is.
I just find it crazy that you would do it completely different because I I can only imagine how >> so what's the break what's the breakthrough is is >> is the breakthrough understanding the value of the agreement >> I think so honestly yeah >> it's like it's saying like wow we have agreement and that's so valuable where can we use this agreement and the way you can agree you you use it is you because you've you already agree and you want to agree. You're in this network because it's a cooperative network. You want to agree on something and all you have to agree on is something so basic which is the order of transactions and it can just happen like lightning fast because you just agree on it and then you're not fighting. there's no friction and and that in a decentralized manner and as you were citing like David's post like the the first one I believe where everybody is uh is running their own software on their own uh machines server and nobody can force anyone else uh rules on on you right like if if I if I say on my XRPL node there is 500 billion XRP okay I can do this I can change you know in my XRP node 500 billion XRP is the supply and I can even gift me 10 billion you know just like that I can do this in my note and I can run that note right but you will say awesome for you vet but I'm not going to adapt the rules you just changed on mine right like you I cannot force you I cannot say you need also to give me 10 billion on your node and make the supply cap 500 billion uh and that's not possible it's it's just completely sovereign and I think this is the core for probably the biggest revolution, you know, that you have like these systems where people run rules enforced by themselves, right? You don't need to tell anyone what the rules are.
They enforce it by themselves and you cannot even make them uh do it else, right? Like I cannot change change you or yours view on what you want to run on your node. And that's powerful. That is really really powerful if you just think about it. That's really powerful. And that's that's helping you with all the scrutiny. It helps you with all the things that's going on in the world and naturally converges people who agree on certain rule set. The fact that we have an XRP ledger network with so many nodes is because everybody agrees that there's 100 billion XRP. Everybody agrees that um you know XRP started somewhere right and had some history and uh they we all agree on this even new features right we agree that we want >> it's implied by our participation >> right and and this is this is not XRPL by the way this is not XRPL native this is Bitcoin native same thing uh Ethereum >> this is the key point because because on Bitcoin and Ethereum they also like like as David said in the post that I started reading before you got here.
Uh, where is it? Oh, man.
I have to go off my screen.
I feel like that's the biggest misunderstanding that I find with a lot of people, especially in the Bitcoin community, in terms of like what actually is the security or the scarcity of Bitcoin. A lot of people say, "Oh, well, it's hardcoded. It can never change." Well, it's really just whatever the social consensus thinks it is. I think you like why would you do that as a user of the network. Um, I mean, it's hard to see right now, but you never know what could happen in the future. I think a great example of uh a hurdle would be what you're seeing in terms of the quantum computing threat. Um, but I think you have other downstream issues in terms of what happens once there is no more reward to be distributed uh through mining. All of these things, right, have consequences in terms of what actually is the scarcity of that money. And I what I find really interesting is it's not necessarily the fact that there can never be more. It's just whatever the majority of the community thinks should be um the rule set and that rule set is always subject to change. It's really not hard-coded at all.
>> Very well said, Michael. And this is why I said like the social layer is the actual vulnerability for you know I said for bitcoin um but actually it applies to all blockchains maybe or community of of uh cryptocurrencies some more than others. I would say the bitcoin community is certainly more than us in the in the community is what precedent does a community make? You know like if we would go back to Ethereum, Ethereum had like this um roll back of the DAO fork right till this day some people make fun of them like very not recently but a few years ago the creator of Salana made fun of that you know because uh they they had uh they had some issues on Ethereum and he made like um a joke he said why are you not just rolling back the chain because there's precedent for it making fun that you guys did it already once in 2015 and um so it's like what does the community as a social layers as you said social consensus set for precedent you know that's why it's important when we talk about incentives uh or other changes to the XRP ledger it's not really XRP ledger fault like when we say we want to introduce incentives right to the XRPL it's not that the XRP ledger let's say failed or did something else it's the social layer that what makes it so difficult because it's not tech based it's like hopefully you have reasonable people you know that uh all hope come to agree as in large that um certain changes should be done or should not be done. And when you look at Bitcoin, I don't think that the social layer at at Bitcoin is is really that robust given like what what precedent they they want to set or not set. I actually have something I've been thinking about that I wanted to run by you. Uh both you and Saul that I I don't know if I'm all the way there yet in fully understanding or thinking through. But one of the things that I was thinking is is like is it actually the social social consensus because I think there's been many arguments on who actually controls right the changes to the code in the Bitcoin network. Is it the miners? Is it the users? Right. But I think one of the bottlenecks you could always point to is going to be for Bitcoin the exchanges or the on andoff ramps because at the end of the day if you had a situation where um all the major hubs or the people providing about let's say more than 50% of the Bitcoin supply chose that they were going to be pushing a certain version of Bitcoin. That's going to be the Bitcoin that people are entering the market in and that people are exchanging in. I wonder if the XRP ledger DEX is a systemically important tool to prevent against the um concentration or the manipulation on on and off ramps in pushing a specific version of Bitcoin by allowing people to interact and get XRP without the control of a single centralized party or a coalition of centralized parties working together to push a certain version of any currency.
>> I actually love that.
There's a really >> I really love that >> and that's and vets's gonna hate me but that's just an argument for nativity and what and and so that's what it provides is that you don't have that counterparty risk with the on with the exchange I think is what you're saying you you've got the decentralized exchange native no you don't have to go to anybody to use it >> which is which is the problem you're talking about >> think about it this way if Coinbase Binance uh and all the ETF providers decided that they were going to start pushing a different version of Bitcoin through those exchanges, the vast majority of people would never know except for a small subset of the Bitcoin community, but there would essentially be no opt out. There'd be no source of truth or there would be no ramp in order for people to say, "Hey, well, I'm going to go do this other thing." There would probably be small niche exchanges that chose to do something else, but there's nothing inherently baked into Bitcoin's code that would allow people to essentially create that opt out of the system. The XRP ledger DEX almost keeps them honest because you always have that decentralized way that you can interact with the protocol. And I think as we have more nativity in terms of tokenized assets and as money moves more onchain, it's going to be harder and harder to create offiscations away from that because if most of the volume, which I think is a certainty in the future ends up getting routed onchain through things like dexes, the XRP ledger DEX keeps all of that volume native to what the social consensus of what people think the XRP should be.
I I I agree that it um it it ships with a default exchange that someone in the Bitcoin world doesn't have. Like Bitcoin doesn't have a decentralized exchange, but Bitcoiners before centralized exchanges also figured out how to, you know, basically exchange uh Bitcoin for money um PayPal and things like that.
Again, it's not great. It's not as great as you would do it with the with the XRP ledger. I fully agree. But I think that that is >> Don't you think the XRP ledger DEX is almost like a magnification of what Bitcoiners were doing in the very early days in terms of they were able to go meet in person and do swaps like uh like Bitcoin swap and stuff like that where they'd meet at cafes, but the XRP ledger essentially digitizes that.
>> I agree. But the problem is with decentralized exchanges is always um on and offramps right um between other assets. So and this is the argument that many people do is rightfully to your original point in a world where we have exchanges very powerful exchanges and nowadays also stable coin issuers do they have an outsized power on fork decisions or even ETFs as you mentioned?
I would say so. I would say yes they have definitely outsized power but it's not like a complete surrender like if if if the community which at the end of the day are the ones who are buying and selling tokens as well um is saying you know what I'm I'm not agreeing with with all this they they can give also a good counterbalance how strong that is you know that's you know I I leave that open but in a world where you have stable coin issuers and ETF issuers out there and they all put like down that they decide which fork they want to choose right because when you fork right let's say you have two two chains you have let's say RLUSD then on both like RLUSD is then issued on both automatically because you just copy you just have now two but which chain is Ripple going to honor redemptions from this is going to be like the most crucial one um only one chain or the other because most likely would it has to be like one they cannot two because they need to have double the the collateral for it. So they will need to choose one and the other one will immediately go to zero, right? It's like one zero. The other one stays at one, the other one goes to zero.
>> And um because that's your on an offramp for a decentralized exchange. I think that further puts that this is something that I've always thought about and I feel like it gets such a bad rep because of the failures of it before in the past, but this is one of the reasons why I've always thought one of the holy grails and one of the most important things missing from crypto is the idea of a decentralized stable coin or something that um would be independent of the choice of any specific party. Um it's a very hard thing to wrap your head around and conceptually like it might not exist yet. I do think it does exist but vet one of the things I was also thinking about was even in the event right where Ripple has RLUSD I think you can offiscate around that issue in almost a decentralized way with having more people issuing USD versions on the XRP ledger because if you have a whole bunch of USD versions eventually you decrease the importance of one single version of USD and then you re reach a decentralized consensus maybe not in the same pure form but almost in the same exact way as ultimately a choice needs to be made but there's not one single party controlling the choice >> that that's that's very well said and um I fully agree with it and that that that's a benefit like we like a lot of people joke oh you're going to have like McDonald's stable coin and USD or PlayStation USD and all this stuff but actually you want a lot of stable coin issuers for the exact same reason that you said if we would have only one stable coin issure And maybe that's also why David said he's in favor of like multiple issuers and not let's say a CBDC which a CBDC is just a a stable coin issued by a government. You know the issuer is a government which they would in that case if we would only have a CBDC just for example or just one issuer of stable coin they could decide on any fork and they would have absolutely outsized power which would be very bad. But if you have like a ton of issuers, everybody can issue um multiple companies, small size, medium, you know, they have all their own unique selling points. It it definitely gives this whole game theory or game actually um a new twist because now if you are ripple again to back going back to the example, you cannot just say as simply you know I'm going to favor this blockchain over this other the fork, right? Because what if other stable coin issuers as you said are going to be on the opposite side of you right difficult now you have to calculate oh I don't want to be on you know on the island while all the other issuers go to this other place >> it's actually one of the biggest reasons why I think it's an incorrect decision not to offer yield on stable coins because honestly the yield on a stable coin is the free market rating almost like a bond what the quality of the reserves are on that asset in a way and if you had a way to almost create uh money market funds that trade like bonds where you had a decentralized rating agency essentially giving what they believe the safety of that specific stable coin would be then you actually have a big reason for lower quality stable coins right if I had the choice to go to a lower quality stable coin because I was getting paid a better yield in order to do so um that that that's not necessarily a bad thing there's plenty of people who would love to take the risk on a lower quality stable coin but if you just have a whole bunch of stable coins that aren't allowed to create any economic incentive that's different from one or the other, you reach the point of you're just going to automatically be attracted to the one that has the highest quality of reserve deposit and there no never be a reason to go to the lower quality reserve deposit. But by having something um like you have in the bond market where there's different yields associated with the different risk you take on, you actually increase the desire to have lowquality stable coins that might have other incentives associated with them.
>> Yeah. But speaking of rating, how would you rate soul spaces these days?
>> Excellent. I'm I'm pumped about Saul having spaces.
>> Well, I don't know if we could trust what's coming out of your your mouths because you know you both are the most the biggest haters in my Blackberry and I'm just like shooting you down left and right. Nicholas pumping open. All you got to do is focus on Blackberry.
You came after me on my uh my open door thesis.
>> Yeah, that goes against all your you know your fundamentals. I'm just trying to keep you honest here.
>> Fundamentals. Fundamentals. Yeah, United States United States uh retail market on property is uh never been worse and >> hop for business.
>> Any any any turnaround there. Yeah, that's that's the play.
>> All right. All right. Just >> I'm not I'm not I'm not a hater on Blackberry. I said, "Well, I'll take another look when I start to see revenue increasing." And um it looks like that's starting to take place, but I'm going to need a little bit more than 10%. If we can get to a 15 20% number, I might be a Blackberry holder.
>> They could they could apply for a grand on the XRP ledger.
>> You missed you missed out on 100%. I'm just helping.
>> Oh, no. I No, I appreciate that. I'm I'm I'm watching.
>> It's on It's on my radar because of you, Mr. Ry. If it wasn't for you, it wouldn't be in the tracker.
>> Watch Blackberry go metaverse next.
>> Yeah, exactly. Like like Albert Blackberry AI.
>> They already got the AI. Come on.
Mission critical. Mission critical.
>> Mr. I found has found what he sees as value.
Useful, right? What could be a better way to describe useful than missionritical >> value? And and do you think price follows value or no?
>> Price follows the perception of value.
>> I think smart money finds value.
>> No, because here's money >> here. Here's the problem. Like >> like this is it's like it goes back to the efficient market hypothesis. Like you're correct, Saul. Like but if that was the case, there would be no investable opportunities. It's like what creates investable opportunities is people being able to identify value before others. But ultimately in my opinion the pricing of any given asset always comes down in large degrees to sentiment which would be the understanding or perception of the value.
All right.
If markets traded on the value of any given thing in real time, right, that's and you should definitely >> No, I think what I'm what I'm saying is that I'm I'm removing the price of the asset from the discussion of its value.
I'm saying that like the value is in at least this might not be true for all things because like you know >> do you think that do you think the current price of XRP reflects its value or do you think the current price of XRP is reflected of what people think the value is?
It David David would say it does because he said um that he believes that enough does did he say billionaires but there's enough people in an open market they would give like a fair assumption what it is currently worth.
>> So that's so so what that idea is and um there there's whole philosophies and theories around this is it comes down to the efficient market hypothesis. So the efficient market hypothesis is that there is no way that you could ever create or find asymmetric opportunities by identifying the market mispricing things. It's something I fundamentally disagree with. I believe the market is extremely inefficient and people constantly get things wrong. So it's a very interesting thing. There's no correct answer, but um I think it is one of the big things that in my opinion drives me to having a deep deep deep bullish case for XRP because I just believe there's no fundamental understanding of this technology in the market. Even when I listen to some of the smartest people in this space or who position themselves as the smartest people in these spaces um with huge followings and huge amount of capital, it seems to me a lot of them lack the fundamental premise of what's actually important for the success.
>> What's most valuable, right?
>> Exactly. So I would argue that the market is extremely inefficient.
>> But Michael, I I I see where you're coming from. And I think you know if you look at volatility that that would speak, you know, also for you. um a lot of high volatility I mean people are really like not sure you know like where where should this go but when you say like that it would not be reflecting enough or would be not efficient enough what are the inefficiencies that you're seeing because if it would be like a market let's say it's it would be highly regulated or it's not an open market then it's true you know like there is no good price discovery no good information um inquiry of it but lack of understanding would you not say that >> don't don't think don't think so much about the word it's a little bit of confusing term unless uh you read about the efficient uh market hypothesis and the different layers of it. It it's not so much efficiency like oh my god if we like unlock this amount of capital or unlock this barrier then suddenly everything would be efficient. It's just the idea of do assets are assets always trading at their inherent value or does the market get >> No, that's what the market is.
>> Exactly. The market we price these things, right? Like >> yeah, the mar the market is the divorce between value and price.
>> But some people some people don't like that's the different layers of that theory. How much is that divorce? Is there any divorce? And is the value of any given asset strictly determined by what the value of that asset is trading on at that given day? or is the idea that Saul you could go in and you can say there is so much value in XRP right now that the market's not pricing. So the theory would be either it's impossible sol for you to identify value that isn't already priced in XRP or there is that's really the idea behind >> but hold on hold on this is this is more from a social also from a consensus point of view let's say you can even like take oil for that matter if you let's say bought a [ __ ] ton of you know like oil for you know let's say November December right because you anticipated hey you know something would happen or you see this coming you know with uh with Iran and and the United States, you would not be able to influence the market, you know, let's say that much because majority would bet against you, right? Like they would say, "No, it's actually this much worth." And you you bought on the other side, but consensus was it's worth, let's say, $50 or $60 a barrel. But um when the market shifted right and the price went up people went more towards your side you know like oh we actually agree with Michl who bought like before that it should be higher so we are buying so it's more of a consensus point of view you know I would say it's it's not like from your point of view absolutely there might be inefficiencies that you are going to exploit in terms of being early you know someone who bought XRP at 30 cents or when the Ripple lawsuit dropped right for them it was like hey I'm looking forward I'm going to bet against that people say it's worth 30 cents because I believe it's actually people going to come to me, you know, they're going to switch over and the price will be higher. But at that moment, I would say the price would be fair because the market says no, XRP is worth 30 cents.
I think uh I mean, as David explained, we're speculating on how future people will speculate.
So, my bet on XRP right now is that there's a big divorce between value and price. And that's that divorce is I'm just going to keep using that word divorce is >> so that so that right there Saul that's a form of >> that's a lack of that I'm saying that's a lack of information you know >> that that's that's weak form market hypothesis. So that's the assertion that um all of these things right that you believe are possible are not already priced in strong foreign market hypothesis would that be that all the insiders everything you know everything I know all the possible outcomes all is already priced into the price of XRP >> that's what I'm saying you're so you're saying that's what I'm saying >> no you're saying weak form you're saying that you've identified inefficiencies in the market where you believe the market at the moment is not valuing XRP which is an asymmetric stock.
>> Right.
>> Exactly. Right. So that's actually a push back against I think what um kind of what vet was initially proposing were what David said because what David was saying it was actually more of a strong form view which is that with the amount of billionaires insiders and everyone who understand XRP XRP is already trading in line with all of those assumptions in place. So it's just there's there's no right answer here.
It's just two different ways of how markets function in general and how value is created. Is it is it possible for people to go in and identify asymmetric opportunities where the market is absolutely mispricing those things or is the market always trading with those understandings in place?
>> Because I personally agree with David actually because if you if you go with with this here, why would a billionaire not buy a [ __ ] ton of XRP right now?
>> Only if it was part of >> they can't. Well, the thing is that you can you can acquire XRP without affecting the price.
>> Well, >> no, just just buy XRP. Like, you know, you can buy XRP. It's it's traded on multiple exchanges free. You can even buy ETFs, you know, if that's your thing.
>> That's true.
>> Why Well, what do you what do you mean?
Why would they not buy it?
>> Yeah. Because the thing is like when we say >> maybe they get their >> you know, >> like because every everyone who's buying or selling is giving the market information. Would you agree with that?
>> Yeah, absolutely. But it doesn't mean it's correct information. That is the game. Yeah. I've messed up all the time in terms of what I thought was valuable.
>> Yeah. And I I agree with this. I I think people who give information doesn't mean their information is correct. It's just that they put money behind what they think. Like if they think, hey, XRP is worth $100, they're going to buy. If they think XRP is actually worth a dollar, they're going to sell. Okay.
Whether they're going to be right or wrong is, I think, consensus, you know, like where is the price going to move? I I think that at any given moment the market actually reflects what people think and if we look at the price it's $130 or sorry$ dollar50 now but uh it tells me that that that's the fair market that's what the market thinks market I mean buyers and sellers you know it's like >> I think there's an important piece here where going back to David's famous December 8th Um, what matters when you buy an asset for speculation is what will change. That's the thing is that it's it it's a there's a lot of risk in our bet because really what we're we're betting on is like the we're we're betting on like the environment around this asset to change in sort of a dramatic way such that new and more people will will speculate on it the way we have already >> like more people it will it the usefulness of XRP will become more obvious to more people that's really so it is pure speculation like that's the thing is that this bet is pure speculation but not all speculation is created equal that's why he said like in the terms of Ripple selling right uh or their their scheduled sales and escro releases and and all is um that's all priced in right now like the market knows about this this is not something that is changing you know that's why when people say cannot ripple stop selling that it would do something well the market already knows it's priced in you know like you know ripple is having like the >> well that data point that ripples you know that data point is priced in but what about data points to come >> yeah you can speculate on or what about or what about data points that we don't know out, >> right? Exactly.
>> Oh, okay. I like that. Okay.
>> If you're betting on data points to come, that's a riskier play, which means you're in earlier, right?
>> Well, well, that's a huge part of it.
But the piece I find like obviously, right, like everyone is speculating on data points to come like everyone is looking for the fundamental growth of any given asset. I think the obvious point would be today is if today you have uh a hundred people buying and selling XRP and tomorrow you have uh 10,000 people buying and selling XRP like no matter what fundamental catalyst is causing more and more people to draw attention to an asset like that is going to be a massive fundamental increase in the attention the amount of net purchasers and if there's any kind of bullish sentiment about that asset more people are going to be buying and holding than selling. Like I think that's the easy piece to wrap your head around. I think the harder piece to wrap your head around conceptually is is XRP right now today based off of everything that is present and real with XRP. Is XRP valued appropriately or is the market valuing XRP?
>> You're using the word value. You should use the word price. Is it priced appropriately >> or is it val you're say valued accurately? Uh either >> well price is the visible thing value is >> Mich I think when Saul says value he's he means it's it's it's cheap or there's going to be massive future recognized value.
>> So that's exactly it right. So Saul thinks that XRP right now right trading on the open market the market is actually getting it wrong. Saul actually thinks that there's more value regardless of what happens in the future, right? That there's more value inherently in XRP than the market is pricing it at today.
>> Yeah. But that is counter to what you by the way said, Michael, before with um with the data points not known because that's a there are data points or NDAs, let's put it even that way. Um that not known to us, but they're known to some people.
>> But go ahead.
>> Yeah. No, this would be in the future.
For me, it's important that it is.
>> No, they're not they're not they're not in the future, though. They're now.
Those are data points that are already concrete. Just it's not fully permeated the market in terms of understanding.
>> Exactly. I I I want the now because when you have the now, people can speculate on it today. Like let's say there is actually something like this going on.
Whoever is in the know could buy, right?
Like you would buy that. That's why these prediction markets are showing, you know, like all these people, insiders and so on. It opens market to everything. And XRP is an open market.
So if you know about let's say the NDAs or not hidden data points, you can arbitrage that. But the future thing that S said, you cannot arbitrage that because that is something in the future not known yet.
>> Yeah. But there's but that also goes against that markets are forward looking.
So technically technically the price of XRP there are entities and individuals out there that believe it's valued forward looking currently.
>> It's valued accurately today. You're saying right?
>> Right. Yes.
>> Right.
>> Yes.
>> Which which which would you know if they're right you know it's not great. But Saul sees that it's valued incorrectly now for the future.
>> Let me let me hyperbolic example. That's like a tricky alleyway real quick to I think >> that that that's just complicated because then it gets into the whole like planned or unplanned thing, you know?
>> Yeah. But but but listen, if if you know if if if Google hypothetically Google is is has a huge multi multi multi-billion dollar deal in like six months and everybody knows about it, that price is of Google is going to reflect what's happening in six months. Now >> let me really hyperbolic example that I think we could all use. Say say behind the scenes, right? And people know about this inside of say the company Ripple.
Ripple already has some kind of deal associated with the United States Federal Reserve to use XRP. This is total hyperbolic example. I'm not saying at all that this is happening or anything. The efficient market hypothesis on both sides is VET would be saying that that is already factored into the price of XRP. Saul would be saying that is not factored into the price of XRP. Those are the kinds of things that we don't know and there's no correct answer on. It's a thesis. It's an idea. How much of those things are baked into the price is where the debate is. I would argue that Saul thinks that those sort of things are not well enough understood by the market in terms of their importance for XRP to be valued accordingly. And Saul believes that buying XRP today, you are essentially getting not only the success of XRP in the future, but the amount of the market mispricing XRP based off its current position in value. VET is saying that there's a ton of success for XRP in the future, but everything already happening and everything where XRP is already positioned in terms of what we know publicly versus what we don't know publicly is already priced into XRP.
>> Good question. I I I think we all know like Saul's reasoning is cor is probably more right historically. So, Nvidia in 2024, January 2024, it's $50 the stock. How come the stock wasn't $150 then?
>> Because there was no data point that AI will be like this.
>> It doesn't but but vet you're then you're saying that the price reflects only the available information and current fundamentals.
Okay. But what about what about reaching for the moon? You know, like what about looking into the future? What about being >> That's why I said the delusional that's why I said the delusional people will outperform everyone because they are they trading on on data points that is not available to someone who is looking at what's face value.
>> Can I be clear here? It's called the efficient market hypotheus people.
>> Can Can we take a little Can we take a little detour then? That's really exciting.
>> Yeah, do it. I mean, we're talk I mean, we're talking about assets. Okay. All right. Everyone see that light-skinned black fellow with the glasses that DI posted with the repricing of XRP?
>> Devon?
>> Nah, he's a little lighter. But anyway, so Saul, I don't know if you saw this, but he's usually not pro XRP and he's talking about >> Oh, yeah. Yeah. That's what's his name?
Modern investor.
>> Right. So listen to the statement that listen to the statement that he said at 109. One of Saul's favorite lines >> from the riddles.
>> Are you going to play a recording now or no?
>> I'm playing it. Hold on. There's not a lot of RAM going already.
>> Yeah, exactly. I would have it already.
>> All right. All right. There's not a lot of RAM at work.
>> Idea is that >> here we go. Once we have the Clarity Act in the United States and the thumbs are up, XRP is supposed to be used in mass across the world and the United States. XRP is supposed >> to be used >> TBU to be used >> straight out of the room.
>> And that's actually I'm glad you played that, Mr. Right? Cuz that's this that's like a simple idea to be used. Like that's the whole thesis for XRP to be used, >> right? But this makes it also so easy to speculate on, right? Like >> No, no, hold on. I think hold on. I don't think because you have to grapple with the weight of that. That's the challenge for the investor about when they enter and in what size of themselves, right?
>> Yeah. But that makes it perfect. That's what I mean. This is perfect for to speculate on, right? Like some people said to be Hold on. For for someone said to be used, >> some people say, "Oh, it's going to be used in meme coins." Right. And other people think, "No, no, no, no. This is some people understand the implications of those three words."
>> Right. Exactly.
>> And but then some some people always think, oh yeah, they're going to use it, but they're in and out of the asset in a second, and then they don't need it. So there's people that understand it's going to be used, but they are not valuing what two mean.
>> They don't understand what value is. If you understand that value is equal to usefulness, you would know that just that it's to be used is like the most valuable thing.
>> But this is not a data point for folks.
Like we talked about it's a it's a it's a m see that's the thing. It's a matter it's an identification of value. You guys were getting really fancy. But the fact is is that like I because I think value is equal to usefulness. I currently think that XRP is extremely valuable because of how useful I think it is and my bet is that XRP's usefulness i.e. value will become will become obvious to more people in the future.
>> I feel that I have identified its value before others. So you think if that the market had the same if the market understood the value of XRP as well as you did, XRP would be trading at a higher price.
>> Correct.
>> Yeah. That's that's the that's a very inefficient market hypothesis. And I'm not saying that's wrong, right? It's a hypothesis. It's there's no >> again again when when you when you when you said before >> just >> when you said when you said before Michl about the um being right or wrong this is this is a given you know like even people who have like data points available like it doesn't mean of course that you are going to be right like you are going to do with the information right now like if if you said you know XRP maybe will be used uh there's information hypo hypothetically United States Fed banks whatever then that is information available to people and they can bet against it like even though if they have that information right but you will have people trading according to that information is what I'm saying while the things that Saul was saying or about this the future speculation is not a data point itself is is it's something more abstract and that that is fundamentally different in my opinion than a data point where people can trade u >> this is where early on in my journey by people close to me who were like more quote unquote like savvy investors what their attack on me was that you're not investing you're speculating.
>> That's what I was told early on and I didn't know anything early on and the person I was talking to was smart.
>> Uh they need the headlines.
>> See, that's [ __ ] because like you can make like you're always speculating.
Like if I'm going to go buy if I'm going to go buy a United States Treasury bond right now, right, I'm making the bet regardless of how insane it might be that the United States is not going to default on paying their debts. I'm also making a bet that and I'm speculating that that's the best way for me to earn a risk weighted return on my capital.
It's impossible to make any kind of investment without ultimately speculation. Now, there's different natures of what you're speculating on, right? And the risk profile you're taking on and whether or not the risk profile you're taking on is worth the level of assumptions you're making. But it doesn't matter if you're looking at a company financials and investing based off of uh profitability, based off of IBIDA, based off of anything, you're always speculating that those things will translate into positive sentiment uh for the price. There's it's impossible to invest without speculation. I I've always pushed so hard against that. Someone might say that you are taking extremely aggressive bets in the market and you take very risky bets, high high profit, high reward, uh high risk. That's an okay thing to make. But to say that you're investing, say I'm investing without speculation and you're investing with speculation, right?
>> That's a fundamental misunderstanding of how markets work.
>> I I I give you like a good example.
>> Use a risk weighted asset on >> Matt. All you have to say is Blackberry.
That's the example. No, hold on, hold on. Just one thing before before we go is let's you take the again the example with the United States government. Let's say use XRP. Okay, just for example, United States government would use XRP data point. Okay, that's data point available to some people or maybe to the general public just to say but now you have like two different people do two different actions. Some people will say well United States government using XRP will have no value acrruel for XRP.
Well, because whatever like let's say you don't have incentives a fishy would say whatever and so I would say actually if that is going to be used on that stage on that level has massive implications because of all these like list of arguments and then you have people trading according like to these things. So for the same data point you have people of course going into different direction and they can be right or wrong like soul might be then right because when it actually then happens XRP sourced to let's say $100 while the people who knew about that information and did nothing you know are not being rewarded. Okay so the data point available to some they can interact but how that actually impacts the market is I think that speculation part where it you know differs and >> they just made the best thesis win you know. Yeah, which is fine. Which which that's why I'm going back to the efficient market hypothesis. I think the market rewards winners because of this, right? Like you need the people lose who actually make bad bets and the people win who make good bets because if if losers become winners, there would be a problem.
>> What's interesting about that is like, you know, you bring up not not to pick on Fishy, but it's just a good example.
like he would say that he would say two things. One, it's not going to be used.
But then he would also say two, even if it is used, that doesn't benefit XRP holders at all because there's no friction basically is what he would say.
There's no direct value acrruel to an XRP holder.
Whereas uh scam detective 5, may he proverbial rest in peace.
He actually told me, he actually told me, "No, you have a good thesis that they finn to use it." Basically saying like if it were to be used, that would be an extremely valuable proposition for holders of the native asset of that chain. That's he basically said that's a sound thesis you have. I'm just telling you they're not going to use it. Does that make sense?
So he's saying like if it were to be used, yeah, you're right. That would be super outstanding and the implications would be large. They're just not going to use it >> because he would go according to the data point, right? Like we just said about that's XRP used in XRP uh in United States government.
He says that that that's not a data point. That data point doesn't exist or is not true, right? Well, you say if it's true, then high price, >> right? But he was saying like even if it's used a bunch, it doesn't matter. It doesn't affect the price. And that's just a fun that's a very I mean terrible blunder about in understanding what moves price which of which of course scams doesn't make that same blunder >> but he he said when if it's going to be used at that scale it's >> no he would he basically not not even about that example I'm not talking about the United States using XRP.
>> Yeah. Yeah. Just >> I'm saying that he Fishy says both it won't be used and then he also says even if it is used it doesn't matter for XRP holders.
>> Exactly. Yeah. That that that's what that's what I was putting him in.
>> Right.
>> But I'm saying that like this is this is about developing the thesis and like you we can all see data points usage and then from there we have to place our bets based on what we think the implications of that data point are. And I think I think this is the skill you know the skill is knowing what the implications are because the other data point is really I mean either you speculate that that data point exists let's say they are going to use it okay or you actually know it you know to going back to the Mikl example where maybe there are some insiders know it but if you if you fail the implication skill as you said right like applying it knowing like hey will it have impact or not the speculation skill I think this is the punishing part the other part is really outside of your power I would say because e either you know or you don't.
The thing the simplicity of of all this is you know again I could be wrong in how I'm thinking about this and how I'm formulating my thesis but the the the bottom line for me is that like I believe that the value is equal to the usefulness. And then the other thing is I think that smart money speculators, people who are trying to be what we're trying to be, all the people everywhere who's trying to do what we're trying to do, the smartest money identifies value.
That's what they're good at doing, right? As investors, like who what are the best investors good at doing?
Identifying value earlier than everybody else. And so then for me and maybe I'm like, you know, if I also have this definition over here that value equals usefulness, like it's just it's all about what's going to be used. That's it.
Like a broken record with that [ __ ] Because people speculate on they they store their value in the most useful thing. At least when you're talking about commodities and money and stuff like that, >> but how useful you're not making that um uh decision, right?
>> It What do you mean? It's betting on It's betting on how useful something is going to be or you know in the future.
>> No, no. I mean what that useful is you know like is it um liquidity? Is it store of value? Is it is it money?
>> Right. That's why Bitcoin it like I would argue that Bitcoin is decided on by the market as the most useful crypto asset and it is the most useful for a whole host of reasons historic historical and otherwise Bitcoin is the most useful crypto right now.
>> But you know what interesting you would agree with that right? I would agree with that. But I I don't think the people necessarily exercise that usefulness by self custody. You know what I mean?
>> You mean they don't self- custody?
>> No, no, no. Like let's say um payments, right? As as one of it. Let's say payments, global payments, censorship, let's say censorship resistant payments, decentralized network.
You know, not everybody is exercising this. They they just also speculate on that they can do it whenever they would need to. It's the same same thing same thing same thing same thing same thing same thing same thing same thing same thing same thing same thing actually also with XRP you know a lot a bunch of people hold XRP you know um maybe even in the belief that they would use XRP if they would need to uh because everything else is being censored but they they wouldn't exercise it so you just keep it in the in case you would need those properties but you don't necessarily exercise them constantly same actually also with gold like persistence holds a bunch of you know precious metals not because he is exercising it right the the usefulness of it, but because he assumes maybe something would happen in the future to the US dollar that would necessate necessitate him to have an alternative uh system.
>> Or is he just betting on that other people are going to do what he did?
>> He's betting on the collapse of the US fiat system.
>> But you know what it's interesting thing is with that. So what you said is it's indistinguishable, right?
cuz both are owners. Like someone who is speculating that that persistence is going to speculate on that is indistinguishable from Persistence owning it because he speculates. Like let's say I buy just I just buy silver because I know there's a bunch of people like like persistence who buy silver because they think the US dollar is going to collapse in 5 years. I actually don't believe it but I think there's a bunch of persistence out there who believe it.
>> Here he is.
I think that's where you come into the investing side of it versus I think one of the hard things about um crypto is there is an underlying usefulness to it that can amount to a form of value associated with the underlying assets that's to be determined. I've never seen anyone produce any useful metrics that actually correlate to something that we can put to on the utility side. Right?
like is it going to be the case that actual use cases for the underlying crypto assets will contribute to a floor or contribute to some amount of value associated with the underlying asset?
Like my answer to that is yes, but I I can't look at transaction speed. I can't look at TVL. I can't look at the amount of DeFi applications. I can't look at the amount of builders. Like I have no idea how that value translates. It's easier to look at it from the perspective I think of equities where you're actually really there's not a lot of underlying or if any utility of the underlying equity other than speculating on the future growth potential of any given company. And I think that's what complicates it and sometimes we get a little bit into the weeds in terms of a crossover on these two things. Some people might not even believe there's any value to the underlying utility or usefulness of the given cryptocurrency.
But I think that's what's yet to be understood. I think what is understood is that people are going to speculate on the perceived future value of these things just like they do with equities.
But there's a second kicker here that's hard to understand, which is the overall value of the utility of the cryptocurrency itself. Well, there's been certain types of strategies that have been implemented recently. Like you, if you want to think of like more tradey ones, you just use a riskadjusted return on capital where your capital is just the deployed funds in your formula.
But if you're talking about like a network value, you there's ones that people like to use of network value to a meta law ratio where it essentially measures users to transactions.
uh like people like to use uh discounted cash flows on like uh uh networks that like to do fees or burns or staking like Ethereum. Uh I don't know there's certain types of different types of tools that uh really people have used for capital allocation but like traditionally the ones for banks like you said on a a return on risk rated capital that's not really like something used for crypto.
Um I don't know >> like what like what is the underlying value associated right with a large amount of USD derivatives equities um tokenized on the XRP ledger and XRP ultimately being used as a bridge asset or liquidity be between those things other than people speculating on the value of saying this is really good and I want to own XRP like what is the value of that that's the thing that I think is a huge unknown and And I think that's a very positive thing because I don't think we've seen a lot of things like that in the world. I think you could argue and try to make the case with with gold that there's like a fundamental market underpinning the gold market where there's a level of usefulness. I you can make the argument for other metals and stuff like that. Um I just fundamentally believe honestly that the the value of what cryptocurrencies can bring to the world is going to be exponentially more important.
I originally bought gold to preserve my value that I was holding. The little amount of wealth that I had five years ago. I bought gold and silver to preserve that value. It just so happen.
>> Did that work persistence?
>> It did because the value of the currency that it was measured in just so happened to go down substantially, right? And that was my bet. And that continues to be my bet. And my thesis with XRP is, and I might get some hate for this, but that's okay. XRP is not a speculative asset. Okay, we've we have I mean all of us are here speculating but we never see the price which is measured in a fiat debt note system. Price doesn't go up because there's no true value added to the ledger. Um in order to get value added to the ledger, we need to put valuable things like tokenized assets to actually hold value onto the ledger. So that's what I'm waiting for. Um, I in invested in XRP because I was investing in something I thought would would bring in a paradigm shift. And I think the reason we haven't seen that great price appreciation yet is because we haven't witnessed that paradigm shift yet. But as we move further away from the Fed and we get more independent and more sovereign as a nation, we start issuing currency issued by the Treasury, which actually does issue currency based on things with real value, whether it be land, uh, metals or oil or whatever. Um, I think in order to get to that point, we need to delever the system completely, right? So that's what we're seeing in the Middle East right now.
That's what we saw in the Middle East right now was a complete debt deleveraging of the oil markets. And I think we're getting close to that paradigm shift that we're all waiting for when real value is measured by XRP as the unit of value. Um, but that's just my opinion. How's it doing today?
>> It's good that you also say it's your it's your point of view because someone who bought XRP in 2015 or so, right?
Life-changing money for them, they saw amazing returns.
>> That's accurate. But I I would argue that that those increases in price only be only increased because value was placed on the ledger. So, if you do a little digging, which I did, um, gold is first tokenized on the ledger back in Q3 of 2024. Um, >> was tokenized before, but it it's it's both useless on XRP. There's no control.
>> All right.
>> But, you know what I'm what I'm saying is it it outpaced massively um the inflation of of the US dollar, right?
um and even out outpaced your purchasing power that you would have theoretically lost if you would have held um dollars, right?
>> Can you elaborate on that? Can you elaborate? Massively.
>> Yeah. Because if if you just look like let's say between 2010 and 2020 20 let's say 27% inflation XRP during that time, right? Let's say 2015 about 2016 massively, right? Outperformed that. So you got way more than just preserving.
Way way way more.
>> Hey Saul, why did you push against that comment? Can you elaborate or just leave it there?
>> Cuz gold was tokenized way back in the day on the ledge.
>> Oh, okay. Okay.
>> Early on. Gold and silver.
>> It's after you said you did some digging. Come on.
>> You call me. You call me. all this specula, you know, gets really tricky for sort of uh skitso XRP holders because like, you know, we're talking about how we think other people are going to speculate and d and like it all makes sense theoretically and applies to to this type of thing. But when you you know, for me like I think that the the capital running through the XRP ledger is part of its plan for adoption.
you know, so I think that the liquidity is, you know, managed so because in order for XRP to be most useful like at scale it, you know, it has to be deep enough and stable enough. And so like that that piece is so important that I think it's, you know, managed. It's a it's something >> I like what you what what you what you typically refer to in a different way. I think you use the phrase um liquidity building exercise.
>> I like that point because because building for me is sort of step by you know it's like there is um there are steps in between you're you're building in steps you're exercising >> you have to go up and then you have to go over like you need both the y and the x axis in order to build that base of liquidity.
Yeah, I battled this for past couple months trying to figure out how this is going to work out because I'm like, well, if XRP is a paradigm shift and it's something new, then it's never going to increase in price in in in the current state that it's measured in, right? And I and it just never made sense to me until I finally realized that it's just we need to issue actual value onto the chain instead of just putting debt notes on there or just speculating with debt notes. It's it's not what the ledger was built for. the the ledger was built for facilitating transactions of value, right? The internet of value. And so that's what I'm I'm waiting for. And recently, >> what if you what if you uh migrated the Bitcoin um assets over to the XRPL because we've already introduced the quantum proofing um where they're having a little bit more difficulty um uh getting all the validators to agree on it. Would that bring the value that you're talking about to the ledger?
>> No, I I actually think Bitcoin is exact opposite of um >> spicy >> of uh of the XRP out and that is measured in debt debt notes and that's where its value comes from. Um but um I don't think any of that value would make the XRP price currently go up. Oh, >> I will say that David Schwarz did reply to a post of mine where I have Do you guys remember his post where he's It's a cyber truck towing a dinosaur.
>> Yeah, it was a cyber truck.
>> Yeah. He's like, "Have you ever seen a cybert truck towing a dinosaur?"
And I did a quote post of that saying when a Bitcoiner is moving their bitcoins on the XRP ledger and he gave me an ovation in the reply.
I I can find that and put it. So there's something to that thing Shellfish is talking about and that is just beyond spicy.
Right. Why are you a spicy shellfish?
>> Um well um I've been watching a lot of the cyber security um uh videos um on YouTube, the Defcons, and um they're saying that um it's a problem sooner than later. Um possibly as early as 2027. So um if the consensus um to upgrade the Bitcoin um validation network does not get implemented um would would it not be um a plan B to uh shift everything over on and potentially wrap it onto the XRPL? Um we do have Ripple who um has their banking charter so there is a connection into the banking system. Um, and um, I don't know. Uh, I'm just thinking I'm trying to think outside the box on how um, they would they would both work.
>> YouTube channel, Shellfish, maybe Mikla can help you with a thumbnail.
>> Yeah, right.
>> I mean, I put it up top, so you know, that's the proof.
>> Well, how does uh, how does a commodity get a banking license though? for talking about like XRP fundamentally like Ripple can get the banking license.
But if you want to talk about like tokenizing Bitcoin on the XRPL, >> would that be all Bitcoiners like issuing somehow issuing their >> you you'd need a company, right, to like So you'd need a company that was like solely focused on it outside of some um quote unquote decentralized protocol that had some way of doing it, which I I don't think is physically possible, but if you kind of look at like what um what like Gateub does, I mean it's really just uh you give me um the Bitcoin, I give you uh an XRP Bitcoin.
>> Is that plausible though? Like we see that happening? It's like a hard fork.
No.
>> Well, there's not necessar No, it's not a hard fork. There's just there has to be a reason for it to happen. um if the majority of Bitcoiners aren't using Bitcoin for payments, right, and they just want to store value in Bitcoin and there's no at the moment um I would say reason in terms of like a financial incentive for them to take the time and effort to move Bitcoin over to the XRP ledger, um pay a fee, and then take the risk of GateHub holding their Bitcoin and preserve erving that peg like why would you ever do it?
>> But but hold on like on they do it actually just on Ethereum like let me see >> because but but but v that because there's a financial incentive to do so if there was no DeFi on Ethereum I don't think anyone would just be choosing to hold wrapped >> I agree >> wrapped Bitcoin.
>> Yeah. Yeah. There's like 9 billion rap Bitcoin on on Ethereum. We just don't have it on the expiry ledger because there's no demand because there's there's not >> right or enough defi there's there's not a re there's not a reason to do so right like it doesn't even necessarily be defi it can be payments it can be something that doesn't exist today there just has to be a reason for it to happen >> why why do you think it it ex that reason exists on Ethereum and doesn't exist on XRP ledger >> defi sorry >> defi okay why does defy not exist on xrp ledger and on Ethereum.
>> Um well I I don't think I think the le I think it depends on what you really call DeFi like what has been successful in terms of um DeFi on the Ethereum ecosystem. I mean really what has it been? It's been um to a large degree it's been a lot of lending solutions. I I I don't know how sustainable a lot of this stuff really is in DeFi on the EOS in the Ethereum ecosystem, but there's been a desire to pursue it.
>> But I I I don't expect anyone has to to have like an like it was a great answer.
I don't expect anyone to have like final answer, but it just interests me of course because um I would love to have the same and more on the XRP ledger, right? Like for me, DEX is the most awesome thing on the XRPL. So I naturally compare it to what already sort of is established like you I I agree by the way when you say defi in large or how many assets in large exist in the world versus what exists on on blockchain as a whole it's like nothing right like is when people say look how much rwa is being tokenized like almost nothing but it still interests me that there is a lot more currently on these other chains than versus on let's say XRP ledger >> I mean in my The way I look at it is like what has been the most popular DeFi applications, right? They've been smart contract lending platforms. And I'm curious to >> So we need smart contracts, M.
>> What do you say?
>> So we need smart contracts. M.
>> No, because I don't even know if those things are going to pursue to be really where people choose to engage in that activity. If you keep having these large smart contract hacks on Ethereum, I mean, who in the right mind is going to choose to expose that risk of doing a loan regardless of what the rates are? I mean, yeah, you might go to three to four% better rate, but if the risk on the other side of that rate is that you lose everything, that might not be it.
And there's been a whole bunch of like there's this whole movement right in the Ethereum ecosystem in terms of yield farming as well. But like it's just doesn't really like work. Like the more you look into like how a lot of this stuff functions, it's really more of like a hey, you give your tokens here and then we have this other token that we inflate to infinity and if we market it, we can create a lot of value there and then we can sell the token and pay you out of yield. But if if you take a look at all like a lot of the prices of a lot of the tokens associated with a lot of these different like yield farming things, they almost always spiral to zero because at the end of the day the the the money stops in a certain place and the loop ends up that something has to be sold to create that economic guarantee. So like it's not necessarily that I even think >> hold on Michael when you if you say um like all of these schemes and so on right is going on and and uncertainty and maybe not ideal or inefficient practices if that yielded Ethereum 56 billion currently run about uh in in DeFi value on that chain like stable coins and whatnot uh loans all this and we don't do these things like we don't have smart contracts and all that And our you know all the yield and value is like 50 100 million.
How is that then better than the other?
Right? Like we say the 56 billion is is a bad model but we have less. So wouldn't you actually draw the conclusion that the other one is is better even though it's worse.
>> It depends. It depends what you call better because this is where I come back to like what is the amount of DeFi having happening on Avalanche versus the XRP ledger.
Yeah, Avalanche has Yeah, Avalanche is also relatively small like has 750 million, but it's more than XRPL.
>> But is it large is it larger than the XRP ledger?
>> Yeah, XRPL is um >> and what's the amount of what's the amount of native native DeFi happening on Bitcoin in comparison to Ethereum?
>> I mean, that's unfair.
>> No, no, no, no, no, no. It's what the point I'm making that is I'm not fully convinced right that like those things that you've mentioned in terms of DeFi reflect relate to more value in the underlying token.
>> I 100% agree with you. Yeah, I agree.
>> So like what is the overall value of it?
like I I I'm not entirely sure like I I can't answer that in terms of like well if Ethereum right if these things are so important right then why is Ethereum this ecosystem that has all of this activity why is it worth less than Bitcoin and why is something like Doge worst more worth more than Avalanche like clearly there's severe limitations in the actual value created through doing some of these things because if it wasn't the case then Avalanche should have a significantly higher market cap than something like Doge.
>> Okay, two two things here. Either first um it's not at scale enough like there is DeFi going on but you can say it's in the overall scheme it's so low right like there's trillions and trillions of dollars out there in the world and this is overall very minimal that all DeFi currently on the on on any blockchain is not even enough to trickle down to the underlying token. Okay, so one could say that okay that it's just not enough basically currently it's just way too early to make any sort of uh statements in that regard or you could say that the underlying token is completely or that the speculation part is way more than um the usefulness here in DeFi that it's sort of obvisiscated right let's say uh XRP $10 $1 is sort of the the value and $9 is speculation and Ethereum same same thing you can say like 90% speculation, 10% I'd say is is baseline um valued at the sort of rock bottom.
Well, you cannot see it, you know, because it's it's like it's drowned by speculation. So any change in the underlying value is maybe eaten up by by the overall uh premium that is it becomes unclear, you know, unless unless speculation shrinks. you know, when if if when speculation shrinks, maybe it becomes more obvious how much baseline value is versus others, but I I would say that I I would probably go with the one I >> I would boil it down more, you cut out.
>> Sorry, I got a call. I'd boil it down more simply to what is is is Ethereum's value and output of the DeFi activity happening on the chain?
Jesus is the is the value of Ethereum the output of the value happening on the chain or is it the perspective that Ethereum is the D5 chain like >> but but why why are you saying if like actually we know right like we can say it's not you made the you made perfectly the argument hey Bitcoin is number one Ethereum is number two so we know it has right now at least no effect right like if you have a ton of TVL or no effect to the token.
>> So then why would then why would I want then what would be the case to say that like I want the XRP ledger to have smart contracts if it's a a a theoretically lower value output than what Bitcoin's been able to achieve. I agree for for the underlying token it would not and I would I would counter with if I would want to see let's say the chain being used and I say this by the way all the time when we talk about TVL or um DEX activity or liquidity when people say yeah but you know price and so on I think this is detached XRP price will do well no matter what DeFi or TVL we have on the ex on the ledger in the next whatever >> and why it's because >> speculation >> exactly the the the We want other people to want to hoard it.
>> It doesn't have anything to do with smart contracts.
>> No, it has nothing. No, no, has nothing.
But it's it's a different point of view, you know, like if you are a speculator, what what Sol just said 100%. Like I want more of this. But imagine you are one who wanted to see this the deck for example to be used. Would you have a different point of view? I would say so, right? Like you would say, yeah, the underlying token price just doesn't like this is not my metric. My metric is liquidity or TVL, right?
>> I think it depends on where you I think it dep I I I actually think it depends on where you think the future of DEX volume will be. If you think that the future of DEX volume is going to be in the exchange of issued or natively native tokens, then I think Ethereum's model makes sense. If you think the future of DEX volume um is going to be more of a tokenized real world asset market, then I would continue to lean into the fact that I don't think that having smart contracts and instead fixed function capabilities makes more sense. But I think that's that's a hard point to make as well with a lot of the activity happening in terms of token from Ethereum.
>> I actually would agree with you on this.
I think this is independent of of smart contracts to be honest. Like what is the val like what is the value and we get into this all the time like what is the value of like the link token, right?
Like is that something that is like inherently valuable or is that more of just an issue like a a crypto token that might or might not have some level of use case or economic value associated with the necessity of it?
>> Yeah, let me put it this way. This is why for me I cannot base it on on facts or sort of like a real comparison here because it lacks you know if you look at what uh XRP ledger D5 liquidity output is you know we can just say it's non-existent almost um compared to these other chains but I would and I cannot say well if we would get this much or the same thing they would that the price of the underlying token would move because you know you made the argument with Bitcoin Ethereum very well but let me say this I believe the XRP ledger is much better in capturing uh DeFi or DEX activity value for the underlying token versus these other chains because we have like these native features like auto bridging for example that is going back to XRP that Ethereum just doesn't have. Ethereum doesn't have like a native auto bridging um that aggregates this for Ethereum right so their activity is cannot then be by in my definition reflect that well to Ethereum as it would with XRP. So just speculation on my end if we would have the same amount of activity it would to what degree I have no idea but reflect also in the underlying token right it's just speculation I cannot base it off anything because the XRP ledger is unique I have no I have no reference I cannot say uh another chain because there is no other chain that is built like the XRP ledger >> but then if you implement smart contracts don't you just get to the same liquidity silo issue that was created on Ethereum >> if we We would have smart contracts.
>> Yeah.
>> Yeah. We would have we would have probably both models then we have like segregated like and and the native.
>> Exactly. And like that's where you get in and that's where you get into I think a lot of the I don't know it gets much harder to to see at that point. Right.
>> But you see the difficulty for this is this is by the way for all really good debates and arguments. You can go both sides and this is like for me >> I'm going to put you on the spot spot right here. vet yes or no smart contracts at the moment >> on XRP ledger.
>> Yeah.
>> No.
>> No. Wow. Okay. So, is that is that perspective change?
>> You you literally retweeted my part.
>> I I mean like I don't know, man. You you you seem to be back and forth on this issue.
>> Yeah. But to be honest, I I think I made it very clear that um how my my view changed uh for different reasons, right?
Like I I had like the security issues were like really important for me. And to be honest, you could even like for large say I I was right like the batch thing came later the batch bug which because previously I was basing it on the permission delegation bug. So I think I was sort of right that hey you know with the native features there comes risk but I I did not account for all these other things that came up like formal verification um all the AI tooling that we have then I talk with Fig who is like an Ethereum developer about like all these other off-chain ways that come that I have to say I cannot decisively say yes smart contract no I need to sit this out uh because I don't have enough information about these things and that's why I refer to to No.
>> And do you think a change at at that scale requires more like a higher level of certainty on your part?
>> Yeah. Yeah. Exactly. That's why you cannot just space it off like 50%. Yeah.
60%. Yes.
>> It's like the legal system beyond a reasonable doubt.
>> You need Yeah. You need to be very decisive like you need to be saying 100% because of whatever. You need to be sure like very very firm and and but to go back to the the the smart contract part and you said like segregated liquidity and not they in my opinion looking why they have so much TVL or so much DEX activity in general liquidity stems from smart contracts uh in part because they have they have an incentive to compete with each other for liquidity. Okay. So on the XRP ledger because liquidity is aggregated, right? It's much harder to compete for that and that makes bootstrapping harder. Okay, this is where the the name of the game comes. I believe if we can bootstrap the XRP ledger DEX liquidity, we will be ahead.
Okay, once we get above like beyond the bootstrapping part, bootstrapping without like in my opinion smart contract is is very very hard because we cannot like induce these >> you need an an external force.
>> Yes. And and a good example for this by the way is also the validator set on the XRP ledger, right? like before only Ripple ran validators. Then Ripple said, "Okay, >> it's the exact same setup."
>> And then Ripple said, "We're going to pay uh these instit uh sorry uh universities to run also validators, which you know they did and then they run ran validators to a degree now that Ripple can completely shut down their validator and even the universities they are actually being right now rotated out if you have noticed and the XRP ledger works awesome, fine, but they need to do in the in the in the beginning something counterintuitive.
Ripple paid other people to run validators which is counterintuitive right you think hey decentralized network people should just you know run without you paying them but it was the right move to bootstrap and then let it go and I think we need to do the same thing with the with the decks we need to get sort of the flywheel effect going once we get this going we have we have no problem but get getting this going is difficult >> that this is extremely high level stuff you're right about everything it's like very good point But it's when you say we just need to bootstrap the liquidity, it's like you're offloading that. You're saying we, but you're off you're kind like how you know what I mean? Which is which is why I'm always butting heads with you about plan for liquidity. And it's not something that we it's not something that we can like win or lose a debate on. You know what I mean? It's just we're we're battling over points of view.
>> But >> like what does that mean exactly? We just need to bootstrap liquidity. Like that's a lot easier said than done.
>> There's two different there's clearly been two different viewpoints of it, right? Like and I think this is a very interesting argument going back to something else that vet said earlier when he said look at the DEX volume or look at the DeFi activity that Ethereum has today. I think the interesting argument would be is that right the volume that ultimately someone like a David Schwarz thinks is the volume associated with where this market goes in the future. Because if you hear David Schwarz talk about DeFi, he doesn't talk about DeFi in the way a lot of cryptonative people talk about DeFi. He talks about things like savings accounts. He talks about things like checkings accounts. If you take a look at where Ripple's building, they're building bridges into traditional finance things that is always going to be a layer of abstraction away from what you see in terms of the DeFi markets today on Ethereum. And the argument I think is at the end of the day, is that the right approach? And is that value more meaningful than the new native value being created in the crypto ecosystem? I'm forever I see it as that a lot of the new forms of value, new value creation, things like um new tokens, things that never existed in forms of value today, obviously that is originating in a large part on Ethereum.
But where does the activity of the system today in terms of migration to a digital form end up in the pursuit of DeFi? I think that's where someone like David Schwarz in terms of how he talks about these things looks at it very differently from where the market has been built from where it's going. I I I I fully agree with this, Michael, and this is sort of the uncertainty.
Did I personally count in you? I I personally I I weigh this very heavily because this is sort of the unknown. Um how much or maybe a known if you if you talked about David, you know, like how how he speaks. He's never concerned about oh we have like 100 million TVL and these other have like I have never seen him like being concerned by any of this because I think you know going back is is sort of there the bigger picture is there's trillions and trillions of dollars out there what we have currently is just it's just nothing like if we base your if you base your decision on very little information you inevitably are very opposed to maybe making a mistake. This is why when we talk about protocol changes based on this information ah gets very tricky right like now you make basically decisions out of like what a couple billions here and there uh while the trillions are out there on in in the world this is the tricky part this is what we should be very careful of when we do these things so I'm in favor of non-invasive uh efforts because I believe I if we can like that's why I said to to you all if if we can do something and I We we I don't necessarily like me and you or someone else, but other entities on the XRP ledger like I I love seeing Evernorth pursuing this like people with some firepower attempting to do something. I'm fully behind that um to attempt like the bootstrapping or you could argue maybe that's more where you come from. Bootstrapping will happen just not now. It will happen in the future. will happen. Hasn't it hasn't like the price right now is what $145$150 right like on J on June 18th 2022 it was 28 cents like has liquidity been bootstrapped at all in the last four years >> 100% >> absolutely we've done we've done Yaxis and X Xaxis you know, >> right?
>> So, I think that there is a liquidity building exercise. It happens in waves and steps over long periods of time that most people don't have time for or don't recognize, I think, >> and it happened primarily, I would say, also on centralized exchanges, which is fine. Like, XRP is one of the most liquid tokens out there. And when you do when you look sometimes uh in in these very volatile moments as per market cap basis uh XRP is like always more than uh Bitcoin and Ethereum like I had in 2024 we had like 40 or 50 yeah 46% or so like you know quarter almost half of volume of Bitcoin but Bitcoin had like 10 times more market cap you know like trillions of market cap versus XRP. That's such an interesting point and like something I always go back to because people will say oh well there's very little right in terms of like DeFi activity right but like look at the activity on the centralized exchanges in which where most of market activity is happening there's a huge amount of volume for XRP and like that's where it comes down to in my opinion the more interesting thing which is the overall demand and liquidity for the token irrespective perspective of attaching the DeFi or CFI handle to it. Like that volume for XRP on centralized exchanges is extremely significant.
>> Then is it wrong to wish or look to have like that volume be on chain instead of on a on a centralized exchange like basic or on the DEX.
>> I like I think it's not incorrect to want it. I think from my perspective there's been a big misunderstanding of what creates that, right? And like that we've talked about this like in terms of like someone coming out like a stellar and saying we've tokenized 400 billion worth of X, right? Or like what does that actually mean? Because those assets just sitting there doing absolutely nothing means nothing. The real question is and the thing that has always been most interesting to me is how do you move marketplace? How do you move a marketplace to that? Because I've always thought that the tokenized assets come when activity and volume and marketplaces are moved to new native rails. And that's what I think you can begin to see in Ripple strategy, right?
Ripple strategy, I think, has a lot less to do with saying, "Okay, we need to tokenize every single form of value and jam it on the XRP ledger, but no, it's acquire someone like a hidden road or a prime broker and move market activity to the XRP ledger." Because with market activity being routed through those rails, that actually creates demand and actual volume for that DeFi layer in a way that hasn't been able to be harnessed. It's not about getting the assets there. It's about bringing the participants to that marketplace on chain.
And I think the difference between something like what you see natively happening on Ethereum is just different participants and different forms of value. And I think you can make an argument over the long run which participants will be more valuable and which strategy will be more valuable. I always find it interesting though the confidence in which David Schwarz will come out and put under the assumption that DeFi adoption hasn't happened yet.
Like to me that's a very powerful assertion where he sees everything that's taken place right now in the DeFi market to the equivalent of the internet adoption with like a Napster leading. He sees it as overall insignificant in pursuit of something much greater and larger. And what we're seeing right now is flushing out of what is ultimately going to be useful and what is not going to be useful. And I think that's sort of the thing where I would lean into that thesis because I personally don't think I've seen much in DeFi that I think is revolutionary or gamechanging or ultimately worth a lot of the risk people take in pursuit of the DeFi activity. So in my opinion a lot of it while significant like you said vet in terms of the numbers ultimately I don't think has the staying power that a lot of people think it might and I look at things like what is happening in terms of the Salana volume in terms of a lot of those meme coins. Yes, a lot of the what's happening in terms of lending on Ethereum is more sticky than that but how sticky is it over the long run or how much of a killer use case or application is that? I think someone like a David Schwarz would argue that, you know, this is just extremely early days of feeling out what people even want to do in these markets.
>> Yeah, that that swings al always like with with me when I look at these is like it's as you said like with the RWA one is a very perfect example when people say hey only has like 100 billion here or 200 billion here. Well, it's like trillions, like you know, tens of trillions of dollars to be tokenized.
And if you decide the winner based on a couple billion here and there or a couple hundred million, >> isn't that like basic [ __ ] Like I feel like I I've had that debate with people and I don't want to name names, but like you have people like literally calling the game over like you're calling like the winner of a 100 yard 100 meter dash like as the runners are like they're like getting their feet in the footholds. You're you're you're you're basing it off of like what shoes they're wearing.
>> It's like >> was you saying >> it's not rocket science, you know, like you just think about the volume of money, right? And you compare big and small.
>> I think I think the difficulty here is is um some people believe it's just at the start while other people believe, you know, we are already at the finish line, right? Which is of course, you know, wrong if you just present these numbers.
But some people believe that. Some people believe hey we are almost at the finish line and you guys are you know so far behind while you know when we hear debate right now it's it's very obvious hey we are we are all at the at the start you know we are we didn't even like start the race >> but isn't it important just to acknowledge that whether wherever we are that this is being rolled out in stages right and maybe we're just not at the price accumulation stage we're more at the distribution stage >> well you my friend should you know chill less in these Bitcoin spaces.
>> Yeah, you're right.
>> I think it's an interesting thing to just think about though. There's going to be a day really where like the distribution of XRP isn't something that's a narrative anymore. And like to think about how we look back at these times like I think it's going to be very interesting to see how perception has changed. I mean, you do move towards a world where it's impossible to argue um based off of how things are today that XRP is a is a deflationary currency. And some people look at like what Ripple's market activity does and and we'll say that's not deflationary. Ripple does. I I personally still think it's obviously deflationary. Um but that model changes and eventually you get to the point where not neither the distribution of Bitcoin nor XRP matters in the slightest. those things are completely looked past. I can already see a dramatic change in terms of how people look at the XRP distribution today verse when I got involved. There will be a point where that's totally insignificant or not a factor or it's not even something people even remotely consider.
And what then matters more than anything else in terms of how people look at these chains when so much of what Bitcoin has done in the very early days and a lot of these other chains have done was designed the chain around the distribution event in my opinion that could be a massive flaw. Th this and the problem that people are so driven by vanity metrics that they just make up right and they try to fit this as sort of the valuation metric for whole crypto. A really awesome one is is is one that Saul loves to quote uh and comment on is like the the protocol revenue. They they list like protocol revenue, right? Like oh this is awesome.
This they have the most amount. XRP will always be zero, you know. So are you going to say now because it's valued at zero it's there's like it's basically >> we won't believe these debates like tol and your point like looking back we won't like wait they were they were positioning themselves based on protocol revenue >> like are you kidding me >> that's a tough one for vets thesis that um that those like those are the people with large amounts of money deciding the value of markets today right that's how people are assigning value. No, I'm serious. Like you go into like the back end of a lot of these investment firms and those are the metrics that they're citing and like it all comes down to at the end of the day whether or not we actually believe super high fee revenue is a good metric or not. If people are making decisions today based off of that hypothesis, right, that that is where value lies, I would argue that that's a completely wrong and broken way of looking at it. So I I think it's really hard to to say that.
>> But but m but that that information that XRP protocol revenue will always be zero is publicly available you know it's like for everybody publicly available. It's no it's no secret. It's just >> what an like it's actually a beautiful thing. It's like being a a poker player and having this just incredible edge or this like incredible like uh tell on like a big whale of a player or something like that. It's it's just information right there in front of everybody.
>> You can also see based off the perception like you listen to some of these Bitcoiners talk and they actually have to try to create non-existent understandings of how blockchains work in order to validate their own thesis, right? That like nothing else can possibly ever in the world be decentralized outside of Bitcoin. Like that alone tells me that there's a severe lack of sophistication in a lot of that community in even rationalizing the real world of how these technologies function. You can see different derivatives of that in every single ecosystem. But like that to me lets me know that like if you if if we in the XRP community like had to purposely misunderstand the way some of this stuff worked like I think that would be problematic. I mean I I'm grateful for the this invisibility that we have honestly like in in in this whole wider ecosystem in crypto or finance world that you say I I love that invisibility because you know I remember like with the guy the Pierre Rashard cuz I remember like when when scams was saying he's actually very respectable in the Bitcoin Bitcoin ecosystem like actually someone who is very respectable and does apparent also good things in the Bitcoin ecosystem on the hill in Congress.
>> Yeah.
>> So obviously obviously for for for crypto or definitely the XRP ledger >> completely ignorant like he was like making the argument that Ripple could just print uh like mint XRP >> ignorant and confident. That's a deadly combo. He had confidence from his reputation that you just described. So you come with this confidence and then you mix in the ignorance and it's like an and then you get our guy Butler making memes of you and just making it rain with memes about Pierre. Yeah. And and that information that Ripple cannot mint XRP out of thin air just like that, right? Is publicly available, but it's for some reason invisible just like many of these things for XRP. And I'm grateful because that gives you actually an easier way to arbitrage that information um delta, right?
>> That's how valuable this app is. That's why I say this I can't believe app is free. we have access like you can see how someone like and I I think this is probably I don't even really understand the efficient market and what is and what isn't but like I'm sure these instances with Pierre and and the crew like these these are probably answer answer that question about like what what we're involved in here I just don't know how but that's asymmetric that that's like a known data point and completely wildly different interpretations of data points So >> massively and like the thing that's even more important is like I don't think we could be making this point as confidently, right, with like some nobodies, right? Some guy with 10 followers coming up here and saying something like insane. But like these are thought leaders, right? These are people that are respected. These are people who get called into the back rooms and asked to pitch Bitcoin over other assets to investor groups. They're like in my opinion a lot of these people with these Oasis are actually leading and creating a big seg big big portion of the markets today. I think the more you get into the back end of a lot of these things, the more you see how small it really is. Um, so if this was like if I I would think it was totally unfair if we were all citing this right as like Pierre and he had 15 followers and it was just some random guy who came up here. But even if you take a look at the largest people, the people with the biggest followings, the people who are propagating the message to the market from these places in the Bitcoin community, a lot of it's just flatout incorrect information.
>> Yeah.
>> It's hard to debate someone when you have wildly different understandings of the current state.
>> Yeah. And and sometimes you know you have like these spaces where you some is it we have a space or you join a space and there's someone coming up with with any of these you know already one space is not enough to educate them right so it's very hard to then like you know are you going to start or just let let it go because the deficiencies are so big it's just sometimes lost they come from the pursuit of a marketing right they come from the pursuit of a marketing campaign rather than the pursuit of information or thesis validation.
It's they want to convince you that they're right rather than better understand what is right.
>> I believe real quick before we go and I believe like when we talk about um institutions, people with a lot of like um control over um strategic amount of money, right? Like things that actually move the needle and all that that they would be smart enough to not be blinded by something like this, you know? Like I I I would I would believe that the very smart people at any given institution, any given entity, right, that they would see through this like they would not fall for Ripple can mint XRP out of thin air, you know, like this is sort of idiot language idiot knowledge.
>> The majority of them are idiots and they just rely on other people's perspectives to try to narrate dark chart to give them direction. And if you listen to any of these Bitcoin maxis, they always refer to >> But but would you would you not would you not say that there are people out there at any of the like you can name any institution or bank for for for that sake that they've actually that that there's someone who has a clear picture.
>> Yeah. Like Dark Side. I think Dark Side knows exactly what the hell he's doing and it doesn't make sense to me why he's still a Bitcoin maxi. Like that guy built all these systems that that people use to trade on yet he's still like so turned off by XRP. It's insane. It makes you feel like it's like not it's not genuine, you know? And >> I mean, you can be turned off. You can be turned off, but still see it for what it is. Like scam is a good example.
>> Scam doesn't like XRP, but he wouldn't lie about what it is or what is not, >> right? But but Dark Side also talks about how inefficient the current markets are and how how you know how parasitic they are and the way they they leech off of the off of the people. But at the same time, it's like he doesn't go the next step and realize that we nec like he understands there's a paradigm shift necessary, but he doesn't understand that like Bitcoin is not going to serve that purpose. And and you know, whether it's genuine or I can't decide, but it's really frustrating. I listen to it.
>> V that I actually think um do you think I'm going to agree with you or disagree with you >> based on how you approach right now? I think you're going to agree with me.
>> No, I I disagree. I I think a lot of the ways that like I get you I think it's hard for someone like you right >> there are firms don't get me wrong there are firms who I believe will get it right >> but the vast majority of them I believe what they do and this is based off of my own understanding of seeing a lot of this from the inside out can't say I see all of them but they would say okay who is someone who is marketing themselves as an expert in the industry they would call that person in that person would write their thesis and then all the mindless heads at that firm would adopt that thesis and say this is how I look at it now. And I believe that the conversations and intelligence going on in this group is far more sophisticated than a lot of the things being put out there in terms of the thought leadership in the investment community around crypto right now.
>> So you say they are basically most of them are idiots.
I don't think they're idiots. I think if you go back and take a look at >> You enjoy your meal, huh?
>> Yeah. I think if you go back and take a look at um how did so many investment firms get the internet so wrong? How did so many people in the United States not have long-term positions of Apple and Amazon um in their 401k, in their IRA?
how so many people don't actually take the time or have the capacity to understand these technical concepts we're talking about. I think it's very easy to look at a company and say, "Okay, revenue is growing 40% year-over-year. Um, net income is growing 60% year-over-year." Those kinds of things are easy and that's what a lot of the investment base of how people allocate money has been based on historically in the United States. I think we're in a new paradigm and a lot of that hasn't been properly reflected or modeled out yet.
>> Okay. But but let's put it that way. If you have very large institutions on a global scale, you know, you can name like the the big banks and so on uh as well. Um would you not say that the ones who had the mo longest staying power, right? Like the OGs of the OGs, okay, the systemic uh what is it called?
Systemic relevant ones, the too big to fail and so on. that they did good decisions in the past over many decades that led them to be what they are.
Hence, they have actually good decision-m.
>> So, so basically what I'm basically saying like the people who survived the longest in in this game are probably the ones who make good decisions.
>> Now, a lot of times in my opinion, they're just the best marketers. Take a look at like the port portfolio performance of someone like a Bill Aman over the last five to six years. he's he's he's severely underperformed the market. A lot of these people aren't so much the greatest investors or the best capital allocators that that it's marketing at the end of the day. They don't necessarily make their money off the performance. They make their money off of marketing and bringing people in.
And that's not true for everyone, right?
That that's near that's certainly not the case for every single person out there. But go take a look at some of the people who are running the biggest hedge funds and biggest investment firms out there. The people who are all over CNBC every single day talking about these things. You would probably make the assertion that someone like Bill Aman who sits so close to the Trump administration and is constantly idolized as this great investor that he would have the capacity to see around corners in a way that the retail market isn't. But that is not reflected in the performance of what he's investing into.
So I I don't think a lot of them really do get it.
>> But but isn't that not enough time frame? That that's why I said like uh Bill Aman over time needs to be weeded out by by by the by by the market, right? Because losers should lose, winners should win over time, right?
Over a long enough period of time, winners should win and the losers should lose. And so a Bill Aman over time over enough time should should disappear, right? Like should be insolvent at some point because they need like enough better.
>> No, because you're making the assumption that that's the only factor that most people will only go based off performance, but that's just not the case. It's it there's a whole another piece of it which is the marketing side as well. And just to go and say, right, like it's not so much always about, hey, if you're coming into our firm and we're going to be investing into crypto for you. It's not so much about let us position you in the best possible way to make you the most money based off the deep research we have done and have this deep understanding of blockchain at its core. No, it's really what is the best marketing event in terms of us getting you excited and giving us some very simple things and a story we can sell you. It's much more of selling people a story than it is, in my opinion, having the ultimate performance and picking long-term winners. And that's just how I've always seen a lot of what you see in markets. If you take a look at even how all mutual funds are formulated and how they're created, they're not created necessarily about how do we create the best performance? How do we create the most long-term value for our clients?
They're really structured in a way is how do we make it so that we can control these people's money without these people complaining. Like that's what it is. It's all about minimizing draw downs and having a story you can tell and being able to draw back on something.
And I just think that's the same exact way they're making decisions about how they're investing in crypto today. It's all about the story they can tell. It's all about looking backwards and looking at past performance. It's looking in the rearview mirror. The second something like Ethereum stops performing or Ethereum has some kind of downfall in what it's doing. You will see institutions pull out faster than they went in.
>> Fantastic space.
Yeah, this thing was electric.
Three hours or so.
Oh, he's he's >> on that note, I'm going to jump, guys.
Thank you so much. You guys are the best. And so, I'll keep these faces going. They're fantastic.
>> Word up.
All right, y'all.
Y'all have a good one now.
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