Dai is the Monetary Base (which, we sort of abstract away from).
Dai + cDai (double counting!) would be M2.
Of course, *we* know that Dai is the only "true" money. You wouldn't accept cDai as money. But in the U.S. banking system it's conflated. So what are the implications?
Mar 18, 2023 • 17 tweets • 4 min read
Did the Fed just accidentally hyperinflate the money supply? Could @balajis be right?
A 🧵on funny accounting tricks and why the Bank Term Funding Program is more confusing than it seems at first glance.
How much "true" USD money exists? Easy. This is known as the Monetary Base, and it's a little over $5 trillion.
Mar 17, 2023 • 4 tweets • 1 min read
Steelmanning my own crypto position, the Fed needs to find a way to engineer a recession ASAP, while not letting the banking system go under. Technically, they can
a) continue to hike short-term rates
b) guarantee the banks' deposits
c) tell everyone else to go fork themselves
The immediate implication would be a MASSIVE, unprecedented, inversion of the yield curve.
Basically, liquidate the world (foreigns, domestic, small businesses, retail, EVERYONE), while keeping the basic infrastructure of "USD money" alive.
This plan would be so crazy that the
Mar 11, 2023 • 4 tweets • 1 min read
A lot of crypto's failures feel extremely heavy when you are in the midst of it all. But in a larger context, all we had was a string of CeFi failures. None of these were "true crypto."
Here's my takeaway from the last 12 months of hell:
99.9% of you/us overtrade and are overzealous about the progress of our tech. Most of us should be sitting in unstaked ETH on a hardware wallet (or BTC if that floats your boat).
Anything further out the risk curve is....risky. Those who navigate well will reap the rewards,
Dec 20, 2022 • 4 tweets • 1 min read
What do you think the theta of the crypto market is right now? Each and every sideways chop day in the markets is one step closer to:
Scenario A: Bearish
-one more day of painful high interest rates
-one more day of Binance, DCG uncertainty
-one more day of regulatory FUD
-one day closer to miner capitulation and mt gox distribution
-one more day of startups shutting down, less funding, bankruptcy FUD
-one more day of unknown unknowns
-one day closer to the total and utter capitulation of the global equity and risk markets
Dec 1, 2022 • 5 tweets • 1 min read
Before all this BS started back in April/May, $ETH was at ~$3000.
Since then, every single bad thing that has happened has only reinforced the investment thesis for $ETH.
1) Luna/UST showed that many high-profile alt-L1s are centralized, opaque, and grifty.
2) Celsius/Voyager/BlockFi/Genesis/3AC showed that centralized lending is shady as hell, whereas DeFi lending markets operated transparently and efficiently.
3) FTX showed that CEXes are complete trash and on a long enough timeline basically exist to steal your money.
Feb 1, 2022 • 5 tweets • 1 min read
A biased take on BTC vs NFTs, but: Bitcoin's marketcap is at a level so high that its market cap can only 10x if nation states start adding it to their balance sheets. An equivalent statement would be that Bitcoin is *valued* as if nation states are on the cusp of purchasing it.
I mean, how else to justify a 10x multiple from the current mkt cap? The sad reality is that HNWIs simply no longer move the needle. Institutions, in theory, could alone cause a 10x, but they are still waiting on the green light from govts (ETFs), so that point is somewhat moot.
Jan 19, 2022 • 25 tweets • 5 min read
Time for a mega-🧵on what I've learned about Olympus over the last few days since I publicly skewered them for running a ponzi.
Was that accurate? Was it warranted? Read and find out!
1/25
2/ First off, I wanted to clarify one thing from yesterday. I had a bunch of people DM me, as you might imagine, accusing me of "dancing on victims' graves." I absolutely did no such thing. I only meant to attack those who knowingly or unknowingly pushed this
Dec 28, 2021 • 10 tweets • 3 min read
The rumors are true, I have taken over as the new CEO of cryptopunks.
2/ "CEO of Cryptopunks" is a community-led project by @0xTycoon, a punk OG. Fun fact, when he bought his zombeanie for 185 ETH in Oct 2020, it was a new ATH in punks. Talk about conviction!
First, some tokenomics:
Aug 24, 2021 • 7 tweets • 2 min read
Quick investment 🧵
Probably one of the best investing 'abilities' is to recognize trends ahead of time, find talent, etc etc. Like, if you knew BTC or ETH or punks were gonna blow up, awesome. You made $$$. But that's really, really hard. I also think there's a second
equally valuable and maybe (?) not often talked about facet of investing, and that's the notion of "feeling like you've missed the boat when you really, really haven't."
When I first found btc in 2015 I thought I was too late and barely invested. It had rallied 1,000x already!
Jan 31, 2021 • 7 tweets • 2 min read
Some clarifications for all the people talking about how DeFi could fix the GME fiasco.
1) DeFi does not, should not, and cannot prevent >100% of outstanding shares to be sold short.
In fact, we have already violated this in DeFi with Compound recursive Dai farming.
The amount of borrowed Dai on Compound used to be much larger than total outstanding Dai (although this is no longer the case). Today, users are still free to supply / borrow in circles w/ Compound, Aave, etc. The risk to users here is a function of the credit quality of
Dec 13, 2020 • 10 tweets • 2 min read
The biggest scam in modern finance is the "risk-free" rate. Trillions of dollars of capital have been misallocated on the premise that there is no credit risk to owning a T-bill. After all the government can always brrr the money printer if need be.
And of course instead of credit risk, there is now substantial inflation risk in its place, which is where the scam occurs. A huge "macroeconomics theatre" is established to convince the rest of the world that USD is *somehow* immune to this inflation risk.
Lots of controversy surrounding the $ETH views, so thought I'd counter just a bit.
First, just want to say that the first 75% of the podcast is filled with awesome trading alpha. Asymmetric payoffs, risk management, inability to dump bad trades (or, worse, doubling down), bad trades turning into investments. Basically, everything that makes you a bad trader.
Oct 16, 2020 • 11 tweets • 3 min read
1) I know basically nothing useful about market microstructure, but I have one theory for why HFT could hate AMM long-term. Requires a bit of an unnecessary and boring backstory in my old career.
2) I used to trade Treasuries, and Tsy futures. And trading the "basis" for a particular maturity was a very popular trade. Similar to how BTC on Bitmex tracks BTC on Coinbase pretty closely due to arbitrage, so too would, say, the 7yr bond track the futures contract for that...
Oct 15, 2020 • 8 tweets • 3 min read
Super interesting technical discussions on both sides of the AMM debate tonight(@SBF_Alameda and @KyleSamani vs @danrobinson). There are also plenty of practical reasons for Uniswap's strong PMF, though. Here's the bottom line for me, as an active Uniswap LP:
For starters, where am I going to get my own personal on-chain algo trading firm with a single transaction? I don't have time or resources to build a bespoke AMM strategy.
THREAD: DeFi is at risk due to ProgPOW. If you care about collateral-based systems such as Maker / Dai, Compound, dYdX, and more, please consider taking a stance on ProgPOW. My number one priority is to prevent a contentious split, not to approve / reject ProgPOW (PP). 1/10
Setup: If PP is pushed through, and there is a contentious split such that the non-PP chain carries sufficient economic weight **even temporarily**, then an enormous amount of collateral will instantly be liquidated. 2/10
Feb 19, 2019 • 11 tweets • 4 min read
A thread on social media platforms regarding the @5chdn drama. I mainly want to highlight that various social media platforms have vastly different characteristics, and that most people aren't aware of this. 1/10
Many crypto reddits used to be small, with high signal. The communities were awesome. r/ethereum, r/ethtrader were markedly different. I imagine r/bitcoin was the same once upon a time. As these communities grew, the quality of discourse objectively declined. 2/10
Dec 20, 2018 • 4 tweets • 1 min read
A (very bad) history of key events for smart contracts on Ethereum and why they're exciting: 1. Create a digital token (ERC-20) 2. Create an atomic swap contract to trustlessly exchange these ERC-20 tokens 2.5 Realize that all the tokens we've created so far are worthless
3. Create a token that's actually worth something, and test out your new swapper contracts 4. Fuck up and have your application drained of 12 million Eth. 4.5 Fork Ethereum
Aug 28, 2018 • 4 tweets • 1 min read
Seems like this tweet got a lot of love from anti-alt traders. I think some clarifications are in order.
Liquidity is just **one** aspect of investing. A crucial, often overlooked aspect, for sure. But fundamentals still matter. And finding solid innovations in the crypto space can be hugely profitable and worth it despite less liquidity. Nascent coins are on a different time scale.
Jul 10, 2018 • 11 tweets • 2 min read
0/ 61 markets and $16,000 of open interest so far within 12 hours of Augur's launch. In case you're wondering "what's the big deal," let's go over some of the markets that have been created so far.
1/ The most popular market was "Will France Defeat Belgium in the 2018 FIFA World Cup Semifinals?" The odds updated as goals were scored, and trustless sports betting will likely be a killer feature.
May 11, 2018 • 5 tweets • 1 min read
0/ This is a fundamental misunderstanding of the point of Bitcoin/crypto
1/ The goal of crypto isn't to redistribute the wealth in some sort of socialist sense (we're not airdropping coins to everyone so we can all be happy together). The point of crypto is to wrest undue power away from those who have honestly earned their wealth.
