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Ep. 026: Why Facebook-coin, Amazon-coin or government-backed cryptocurrency doesn’t matter

by | Jul 16, 2018

One of my new SANE CRYPTO Mastermind members, Mike, sent me this email:

“I had a question that came up with one of my highly skeptical friends. His thesis: Bitcoin is the first crypto-currency, and once the big players get involved (Bank of America, Chase, etc.) and they make their own crytpo-currencies, people will buy those because they are name brands with trust, and the government and the monied elite, behind them. In his view (and his friends who supposedly work at Etherium), Bitcoin and Etherium will be the Friendster or MySpace to “Amazon-coin” or “Chase-coin’s” Facebook.

I was a little compelled by this thought because if we are in the first wave of the crypto-currency era, why wouldn’t Bitcoin suffer the fate of a first wave dot.com company like Pets.com? What makes Bitcoin different that it can survive as more “trusted” crypto pops up?”

This is a really important question and I’m so glad Mike asked.

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“Optionality is the property of asymmetric upside (preferably unlimited) with correspondingly limited downside (preferably tiny).”

— Nassim Nicholas Taleb

Anti-Fragile

In response to Mike’s question, we talk about:

✓ How in some ways my brain wants to agree but in others disagree

✓ Why what I, or anyone else thinks, really doesn’t matter at all

✓ Why Facebook-coin, Amazon-coin or government-backed cryptocurrency doesn’t matter

✓ Cryptocurrency is a venture capital investment dressed up like a publicly traded asset

✓ Optionality and what that tells us about whether to invest

✓ Optimizing for a range of outcomes

✓ Investing as a probability game

✓ How to play this probability game

TO DIVE DEEPER:

Ep. 016: Ask Kim: What Is An ICO and Why Don’t You Invest In Them? – SANE CRYPTO Podcast

What Is An ICO And What Are The Risks Of Investing In Them? – Kim Snider

The Third Wave: The Third Wave: An Entrepreneur’s Vision of the Future – Steve Case (Amazon aff. link)

Airbnb is now bigger than the world’s top five hotel brands put together – The Spaces

The investors who passed on Airbnb’s seed funding had their reasons – Quartz

Anti-Fragile: Things That Gain From Disorder – Nassim Nicholas Taleb (Amazon aff. link)

Great Investors Think in Terms of Probabilities – Cullen Roche

Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts – Annie Duke (Amazon aff. link)

QUESTIONS OR FEEDBACK:

Email: askkim@sanecrypto.com
Twitter: @sanecrypto https://twitter.com/sanecrypto

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