An Unscripted Chat with the Richest Man in the World* (Feat. Colin Platt) – Crypto Critics' Corner
Today Bennett and Cas are joined by the richest man in the world*, Colin Platt: creator of PTK. While you may not be aware of this quadrillionaire, he tokenized his way to being king of the world. Other topics discussed include: wash trading, NFTs, and traditional financial issues versus issues seen within the cryptocurrency landscape. *Colin isn't the richest man in the world in any real sense. Read about PTK in the Financial Times: https://www.ft.com/content/9af35678-36d1-3477-93b8-c3990b87b16a Follow Colin on Twitter @colingplatt This episode was recorded on Thursday, April 14th, 2022
*Colin Platt is not in any meaningful sense the richest man in the world.
Cas Piancey and Bennett Tomlin are joined by the richest man in the world to discuss the project that made him his money, what is up with NFTs, and the issues with crypto wash trading.
Other episodes mentioned in this show:
- Episode 1 – Tether: A Stable Discussion
- Episode 46 – The Complex History and Weird Transition of DAOs (Decentralized Autonomous Organizations)
- Episode 64 – Metaverse 2: Venture Capitalist Judgement (Feat. münecat)
- Episode 67 – An Early Skeptic’s Telling of “Why be skeptical?” (Feat. David Gerard)
- Episode 62 – Should Money Laundering be a Crime? (Feat. Josh Cincinnati)
Resources from this episode:
- PTK in the Financial Times
- Colin on Twitter
- Cas’ piece on velocity of Tether
- Cas’ piece on crowdfunding
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Cas Piancey: Welcome back, everyone. Cas Piancey: I am Cas Piancey. Cas Piancey: I'm joined as usual by my partner in crime, Mr. Cas Piancey: Bennett. Cas Piancey: Tomlin, how are you today? Bennett Tomlin: I'm doing well. Bennett Tomlin: Cas , how are you? Cas Piancey: I'm doing good. Cas Piancey: It's early for me, so I've got a nice a cup of coffee here. Cas Piancey: Today we're joined by good friend of the podcast and formerly still the richest man in the world. Cas Piancey: You might not have heard of him for some reason, but Colin Platt, what a pleasure to have you on the show. Cas Piancey: How are you? Colin Platt: Thank you very much for having me. Colin Platt: I'm doing very well. Colin Platt: It is not early here, but I haven't started on the beer yet. Cas Piancey: Well, this is coffee. Cas Piancey: Just so everyone knows I'm not getting totally wasted yet. Bennett Tomlin: We've got the brief window here between when Cas starts drinking coffee and before Colin starts drinking beer that we can get this podcast recorded. Colin Platt: We do have a nine hour time change between us. Cas Piancey: So, yeah, I guess I could throw some whiskey in here, but we're just going to move on. Cas Piancey: In case anyone is unfamiliar with why I say Colin Platt is arguably the richest man in the world. Cas Piancey: Colin, can you explain PTK to everybody? Colin Platt: Yeah. Colin Platt: So in 2018, I and a bunch of guys got together at this conference in Seoul, South Korea. Colin Platt: We showed up early to the conference and we were at the hotel where it was going to take place. Colin Platt: And this was right after kind of the top of the top of crypto in 2017, I think was like April 2018. Colin Platt: So things were just kind of just coming down, but there was still this kind of feeling of it could all come back. Colin Platt: And a lot of us kind of had seen the good and the bad, and there was a lot of bad in 2017. Colin Platt: There's no hiding that. Colin Platt: And we said, well, there's enough of us around the table. Colin Platt: We're going to be at this conference the next couple of days. Colin Platt: Let's just make our own stupid token and sell it to ourselves. Colin Platt: And so we came up with just like the worst idea of a white paper, just whatever word solid we could throw together. Colin Platt: And I think it was like a Gray paper. Colin Platt: And we made text. Colin Platt: It was like light Gray over dark Gray. Colin Platt: The whole thing was horrible. Colin Platt: And then all of us speaking at the conference just started dropping us in. Colin Platt: Like on every panel we were in. Colin Platt: I was the chief pseudoscientist. Colin Platt: We had somebody that was developer advocacy. Colin Platt: There was no development. Colin Platt: We just made the whole thing up. Colin Platt: And after the conference and during the conference, actually, we had a bunch of people coming up and actually asking us to invest in this project and people wanting to creditably put in sizable chunks of money. Colin Platt: And it went on for a couple of months. Colin Platt: So the following year, same conference again in Seoul, South Korea. Colin Platt: In 2019, we decided that I was going to get up and give a presentation about this. Colin Platt: And it was in this giant Stadium like I think it was the main Stadium in Seoul and thousands and thousands of people there, including people from the government. Colin Platt: And I got up and gave a speech about how great PTK was. Colin Platt: And the basic idea of PTK is you could never sell it for less than it was sold previously. Colin Platt: So the number can only go up. Colin Platt: So best cryptocurrency ever. Colin Platt: This was well before Om or Itchy or any of these great things that we've seen, which basically tried to build this for real. Colin Platt: And I gave this whole speech one of the slides, it was the value of PTK and I'll come back into it, but it was basically $3.6 quadrillion and that is three times the value of all of the money in the world. Colin Platt: It was at the time. Colin Platt: I'm sure it's much less because of all the money printing or whatever bitcoiners tell us happened. Colin Platt: So maybe only two times now, but basically it was this giant picture of this Orange blob that was the PTK logo overshadowing the Earth. Colin Platt: And at the end I said this whole thing is a joke. Colin Platt: And I got a bunch of nasty tweets from people in the South Korean government that were in attendance about how this is so horrible. Colin Platt: But it was a lot of fun. Colin Platt: It wasn't just doing a presentation. Colin Platt: I actually launched this token and watchtraded it with myself on a deck that predated you a swap and actually traded it up to this valuation. Colin Platt: It's just like every time I trade it, I'd only trade it higher. Colin Platt: And I wrote a whole blog post about this. Colin Platt: It got covered in the Financial Times, it got covered in the block and got covered in a bunch of things. Colin Platt: And it was just a really good joke. Colin Platt: And it showed how ridiculous a lot of the industry was, particularly in 2017 and 2018, about these fantastic valuations. Colin Platt: In actual fact, it was all people trading amongst each other, people trading very small amounts and massively inflating. Colin Platt: And I'm not saying it doesn't happen still, but the industry has changed a bit, but it was just pointing out where we were, where we stood in 20, 18, 20, 19 in the industry. Colin Platt: And I'd say since then I'm with you guys. Colin Platt: I'm still very critical about a lot of things, but I think a lot of things have improved and have moved on. Colin Platt: And thankfully we have less 2017 style ICOs. Colin Platt: We have lots of other things that we can critique, but at least it's a new scam that we're running now well. Cas Piancey: Actually, I think it's good that you explained much of this, but I do think there's another point that you didn't go into detail in, and I think a lot of our audience could probably help them to understand how this made you exactly the richest person. Cas Piancey: But you mentioned you alluded to it just now, which is that you were washed in with your you were washed in this token. Cas Piancey: For anyone who's unaware, wash trading is basically selling and buying an asset to yourself, right. Cas Piancey: There's no other parties involved. Cas Piancey: You're just selling it to increase the volume and apparently the price as well sometimes if you want to, I guess. Cas Piancey: But if you could explain how that mechanism works. Colin Platt: Yeah. Colin Platt: So obviously this is much more widely known with unisoup kind of being very prevalent. Colin Platt: And I assume most people know what Uniswap is. Colin Platt: If they don't, it's an automated market maker. Colin Platt: It's somewhat like a decentralized exchange, but you have to have liquidity on both sides. Colin Platt: So you put in makeup token and let's say tether, because I know that's popular here and I put in $5 of tether on one side and then five of my made up tokens. Colin Platt: That means that my token is now worth one dollars each and there's $10 of liquidity in total. Colin Platt: If I go in and I add one more tether in there, well, now there's six versus five. Colin Platt: So the price has gone up. Colin Platt: You can keep doing these things on very small amounts. Colin Platt: Now, I talked about five of my tokens and five tether or six tether in here. Colin Platt: I may happen to have another Quintillion tokens out here. Colin Platt: And if I'm marking them all against this price, that means what started out with just five tether and five of my tokens. Colin Platt: So a five dollar investment quote, unquote. Colin Platt: I've now printed a Quintillion tokens at that one dollars valuation each. Colin Platt: So there's no real backing. Colin Platt: There's no market. Colin Platt: If I was ever going to try to sell this with a third party, like if I tried to sell it to Gas, he would probably very rightfully give me zero. Colin Platt: We're very close to zero because it has some intrinsic value of being funny, but that's kind of it. Colin Platt: There's no notion that this should be really worth a dollar a token. Colin Platt: It's just how it sits inside these because it's all decentralized. Colin Platt: And the exchange I was using at the time, the predated unit swap. Colin Platt: Again, there are no checks and balances of who could put it in. Colin Platt: Anybody could just create a pair, trade a pair. Colin Platt: I could just go in with another account and trade against myself. Colin Platt: There's no notion like what you would see inside of a regulated exchange of saying, well, A, you can't trade with yourself and B, we need to know who you are before you can trade. Colin Platt: And C, we need to do some checks before we even put this thing on. Colin Platt: So even in the exchanges that probably get the most critique on this podcast, there is some kind of processing to make sure that the token we're trading on isn't a token I just made up 30 seconds ago. Colin Platt: The people trading on this, well, they have some money in this account and there is some balance between how much is actually trading in existence, and this value that's reported it does screw up. Colin Platt: Sometimes when we see these things show up on coin market cap or coin Gecko or whatever else, where a token will momentarily exceed the market cap of Bitcoin. Colin Platt: So it's always good when the algorithms screw up and you see people trying to do the same thing. Bennett Tomlin: Yeah. Bennett Tomlin: Ptk was a really good exemplar of how a lot of the easy metrics in crypto are really easy to manipulate. Bennett Tomlin: Like, clearly in this case, market cap, where there was such a small float inflated by such a small number of parties. Bennett Tomlin: Clearly, PTK is not representative of the broader cryptocurrency market, but there are many cryptocurrencies with quite a small float compared to their total supply being traded in relatively illiquid places. Bennett Tomlin: And you hear people discuss the dollar values of the market cap as though it's actual money. Bennett Tomlin: And I think PTK is a good reminder that this paper wealth, this liquid wealth is meaningfully different. Bennett Tomlin: You need someone on the other side of the trade to get any real value out of it. Bennett Tomlin: As an aside, even before Home and some of those newer projects back in 2018 and 2019, there were also ICO projects that were promising that their price could only go up and their price would be buoyed ever upward. Bennett Tomlin: Yeah, exactly. Bennett Tomlin: And I actually got a cease and desist letter from one of them. Bennett Tomlin: So those claims have persisted. Cas Piancey: I'm wondering, Colin, as somebody who's, like you're obviously involved in cryptocurrency, like you trade, you do things regularly. Cas Piancey: I think you understood at that time when you created PTK that Wash trading was a real issue. Cas Piancey: And I think when we've previously talked about, like, for instance, Tether, I think a big issue that people would talk about was Wash trading and how much of the volume of Tether in general was just Wash rating. Cas Piancey: Do you think that's changed a lot? Cas Piancey: Do you think there's a significant difference now than, for instance, 2018? Cas Piancey: And if so, what is the new watch trading like? Cas Piancey: What is the new problem that is comparable to that? Colin Platt: Yeah. Colin Platt: So let me break that down because there's quite a bit in there. Colin Platt: So do I think things have changed? Colin Platt: Yes and no. Colin Platt: I think things have definitely changed more in certain venues. Colin Platt: It's a basic fact there is more regulation in 2022 for everything cryptocurrency and in particular exchanges. Colin Platt: I say everything cryptocurrency. Colin Platt: I'm going to leave defy things off to the side just for a moment. Colin Platt: Everything that really existed in 2017 now, if it still exists, is more regulated. Colin Platt: So things like centralized exchanges, most all of them have at least some kind of basic KYC. Colin Platt: Sometimes it only kicks in at a certain threshold. Colin Platt: It's generally come down in 2017. Colin Platt: A lot of that didn't exist. Colin Platt: Finance, very famously was an O KYC exchange up until the middle of last year. Colin Platt: If I'm not incorrect, it may have even been in early 2022. Colin Platt: But a lot of these things have made, I guess, Democratize Wash trading really kind of a thing in the past just because it is a higher threshold to have to go in and set up five accounts that I set up, I send in, I do the KYC process. Colin Platt: Sometimes that takes a couple of days, a couple of weeks. Colin Platt: I can't trade with myself as I could before, but I could just go spin that up with an API and have a hundred different exchanges plug all those into some kind of AWS spot and run all those things through. Colin Platt: It is harder now. Colin Platt: Does Wash trading still exist in those venues? Colin Platt: Absolutely. Colin Platt: And some of those venues even encourage Wash trading, particularly to projects. Colin Platt: It is still an industry. Colin Platt: It does still exist. Cas Piancey: Sorry, quickly to interrupt you. Cas Piancey: Sorry. Cas Piancey: But when you say that projects can be incentivized to Wash trade, can you explain why you say that? Colin Platt: Yeah. Colin Platt: So with exchanges that list tokens, generally they have metrics set up. Colin Platt: So there is a contract when they list a token for any type of token outside of the largest one. Colin Platt: So generally there wouldn't be a contract for Bitcoin Ethereum because they're just so large. Colin Platt: They need to process those. Colin Platt: Generally a lot of the big stable coins, USDT, USDC, similar circumstances, they need them so they wouldn't necessarily go to Tether and say hey, we'll list you because Tether will just say, well, you use us or they don't. Colin Platt: Usdc is similar at this point. Colin Platt: They're just so big that exchanges need to use them. Colin Platt: Now, I'm not going to get into all the arguments right away on all those, but you need to see a stable coin or a dollar, some kind of Fiat thing, which means you need to have a bank account. Colin Platt: All exchanges do. Colin Platt: So they'll just let those things through. Colin Platt: Now, anything smaller than that and will take even the bigger ends. Colin Platt: Things like XRP will actually go out and they'll talk to the exchanges. Colin Platt: And this was actually quite widely broadcast that some of the exchanges, including Coinbase, took a long time to list them. Colin Platt: There were things that got leaked out that they were paying to get onto different exchanges, including Coinbase. Colin Platt: And this is very well known inside the industry. Colin Platt: There are fees and payments to get any token on even very popular tokens. Colin Platt: Now they have a sliding scale depending on how popular your token is, what it costs to actually get lifted, and different exchanges charge different prices based on this. Colin Platt: But when you do this, there is a contract and in that contract it says things like you need to have volume, you need to have different metrics. Colin Platt: The team can't just run away and scam. Colin Platt: Otherwise we'll delist you and things like that. Colin Platt: Things that you would expect to see when something is admitted for trading, not dissimilar from what you would want to see at New York Stock Exchange or someplace like that. Colin Platt: All of these things, I would say are generally good practices. Colin Platt: Now, inside some of those things, they do have metrics that, let's say work better if it is a very widely traded asset having minimum volumes. Colin Platt: We only want to list tokens that trade over a million dollars a day or $10 million a day, depending on the exchange. Colin Platt: Not horrible ideas. Colin Platt: Now that works very well in the traditional industry where you have market makers that do these things. Colin Platt: Lots of market makers are actually paid to trade with themselves and trade with each other. Colin Platt: So it's not something that is unique to the crypto industry. Colin Platt: And I wouldn't even say that it's quote unquote bad by itself to show that there's some volume in there. Colin Platt: What they do, however, is because they have these very tight things on otherwise very liquid assets. Colin Platt: What that means is you have very, very high relative to real external organic volume, very high just internal trades happening in some of these things. Colin Platt: And if you sit there and watch an order book, you can see these things happening, especially if you get out of the top 50 to 100 tokens by market cap or by volume or whatever metric you want to use from a coin gecko and start looking down to 101 to 1000 that's listed. Colin Platt: And if you look at some of these exchanges, because I talked about a listing coming from the token project to be listed, you also have a lot of these exchanges that are very well known to just unilaterally do their own listing. Colin Platt: And often this is a project that gets very popular kind of overnight and they just decide to list it. Colin Platt: And there was Windows Coin got very popular and not very many exchanges that listed it. Colin Platt: They went out and they started trying to list this thing and trying to figure out how to do it, and they didn't know who to contact because, well, the original founder of Dose just kind of took off. Colin Platt: So there are exchanges that go out and unilaterally do it and they do it often very small tokens. Colin Platt: And these tend to be East Asian exchanges, not exclusively, and they do run their own wash trading in some of these cases to show there's some kind of volume because they know they get business out of this. Colin Platt: If a new token comes up on uni swap is the top three volume on uni swap for three days, they want to be the first exchange to go in there because they know they're going to make a few hundred thousand dollars on fees. Colin Platt: So watch trading does happen. Colin Platt: It can happen either because the project is incentivized to do it by the exchange. Colin Platt: It can happen because the exchange is incentivized to do it, or it can happen because somebody is trying to incentivize other people to come trade on it and they may have no relation to the exchange. Colin Platt: They may have no relation to the project. Colin Platt: They just know that if there is more trading volume, it's going to cost them a little bit of money and fees to the exchange, but that's going to make their token look more investable. Colin Platt: So does it happen? Colin Platt: Yes, absolutely. Colin Platt: Some exchanges actively try to minimize that and only push towards organic volume. Colin Platt: And even some of the exchanges that get criticized for not being necessarily the best exchanges, from a regulatory point of view, are ones that are very actively cracking down on that type of thing. Colin Platt: So does it still happen? Colin Platt: Yes, absolutely. Colin Platt: And it's driven by different parties depending on what we're talking about. Bennett Tomlin: Yeah. Bennett Tomlin: And I think the part of the dynamic that you pointed to there that I've heard about, that is perhaps the most common reason and perhaps most troubling reason for the Wash trading is that you'll have token teams who've conducted an ICO or an Ido or an IEO or however you distribute tokens nowadays, will then want to get it listed as a requirement for that. Bennett Tomlin: The exchanges will often direct them to market makers who will effectively agree to Wash trade them up to a certain amount of volume. Bennett Tomlin: And that's a pretty common phenomena. Colin Platt: It is. Colin Platt: It's slightly different than that. Colin Platt: So from what I understand and how it happens, there are legitimate market makers out there. Colin Platt: These are big entities that are very well known in the industry, and there's a bunch of different ways that they run. Colin Platt: They're not necessarily the ones doing the Wash trading. Colin Platt: Often the Wash trading will be done by a smaller, less known entity, and not necessarily they may be trading against the market maker. Colin Platt: They may be a quasi market maker, but this is very different from if we talk about Alameda or Winter. Bennett Tomlin: Very well known generally not one of the big few, but they're still nominally market makers. Colin Platt: Generally. Colin Platt: These tend to be very small shops of people set up in small countries that are just doing this and saying, I will trade half a million dollars in volume a day, and I'll go and do it very small size. Colin Platt: And I've got a little bot that runs that's kind of how they do that thing. Bennett Tomlin: It's just one of those troubling incentive issues because it makes sense why the exchange wants them to have a certain visual amount of volume. Bennett Tomlin: And it makes sense why the token wants to get listed, and it makes sense why this firm is willing to do that trading for a fee. Bennett Tomlin: So for each individual involved in the transaction, everything looks like it makes sense. Bennett Tomlin: But the net result is everyone sees a number that is inauthentic. Colin Platt: Well, inauthentic these are actual numbers that are trading. Colin Platt: It's not the exchange making up the numbers, but it is not organic order flow coming because people want to buy and sell this. Colin Platt: Yes, absolutely. Cas Piancey: You've spent some time in traditional markets as well, right, Colin? Cas Piancey: So I guess I'm wondering, do you think that this is something that has been mostly mitigated in traditional markets, or is this something that happens in traditional markets as well? Colin Platt: Well, that's a really wide thing. Colin Platt: There's definitely different forms of trading that is not coming from organic, let's say client driven flow. Colin Platt: And what I mean by that is I call it my broker and I say buy 100 shares of Twitter. Colin Platt: I'm just going to say Twitter because Twitter is the thing we're talking about today. Colin Platt: Elon Musk is trying to buy it. Colin Platt: That would be considered organic flow. Colin Platt: I am an investor. Colin Platt: I want to purchase 100 shares of Twitter that goes through a broker. Colin Platt: That broker, depending on the set up, will either go directly to the market for a larger broker or if it's a smaller broker, it may go through a couple of stages and it's different in different markets. Colin Platt: There are different market makers that are trading with themselves for a variety of different reasons. Colin Platt: They could be managing their book and their risk. Colin Platt: They could be managing a derivative position that may have organic flow behind it. Colin Platt: They could be managing the bank's proposition. Colin Platt: So that has been cut back quite dramatically depending on the market again. Colin Platt: Or they could be managing some other smaller things. Colin Platt: Now, exchanges, the New York Stock Exchange or anybody else also has these rules about we need to see a market maker may quote no less than this. Colin Platt: They need to refresh, they need to send out orders. Colin Platt: They need to do all these types of things. Colin Platt: So it does exist. Colin Platt: But we don't refer to it in the same way. Colin Platt: I would say this is my opinion. Colin Platt: It's generally because all of these exchanges are set up in a place that is very well placed. Colin Platt: If we're talking about the United States, Canada, Western Europe, these markets are very well placed. Colin Platt: So even in these volumes happening, we say, well, that's happening because we want to make sure that there's constant connectivity. Colin Platt: And if nothing happens for a little while, that doesn't really reassure people that the market makers are actually there. Colin Platt: Now, if I do want to trade into a market maker in those things, I know that there's depth. Colin Platt: I can see it. Colin Platt: It doesn't just disappear. Colin Platt: That isn't necessarily the case. Colin Platt: Inside of something like a cryptocurrency exchange, particularly in the US, we have things called speed bumps. Colin Platt: If I put out an order, I need to leave it there for some amount of time. Colin Platt: It's blazingly fast. Colin Platt: It's fractions of a second. Colin Platt: But I have to leave it out there for that amount of time in a cryptocurrency exchange. Colin Platt: Generally, unless there's some kind of failure, I can pull that out and put it in whenever I want. Colin Platt: So the whole order book can just disappear instantly. Colin Platt: That is something that generally wouldn't be allowed in a more regulated market. Colin Platt: It does exist in some of the frontier markets, as we've referred to them in the capital markets where they don't have that same kind of speed, like pink sheets. Colin Platt: No. Colin Platt: So this would be generally different countries. Colin Platt: So this could be Eastern Europe, Middle East, Africa, Southeast Asia. Cas Piancey: Right. Colin Platt: Okay. Cas Piancey: We're talking about those minor stock exchanges that exist throughout, like the Seychelles stock exchange or something like that. Colin Platt: It could be much larger than that. Colin Platt: We could be talking about the UAE, Saudi Arabia would fit into those types of buckets. Colin Platt: Until recently, they didn't have all these things in some very large stock exchanges in East Asia. Colin Platt: Places like Singapore really only recently put in the same level of rules that you would see in a place like Japan. Bennett Tomlin: Do you have anything else on this? Bennett Tomlin: Otherwise I was going to toss it to NFT. Bennett Tomlin: Yeah. Colin Platt: So we were talking about wash trading in tether. Colin Platt: So that's what I want to hit on. Bennett Tomlin: Okay. Colin Platt: I only want to hit on a fraction because I know you guys talk about this a lot. Colin Platt: Tether is miles and miles deep, particularly on the watch trading thing. Colin Platt: A lot of people look at the number of tether outstanding and they look at the volume and they say, well, how does this happen that I don't even know what the number of tether is? Colin Platt: I'm going to say 100 billion tether in existence. Colin Platt: I'm probably not that far off, am I? Bennett Tomlin: You got a few months. Colin Platt: I'm going to say 100 billion because it's a nice Rod number and there's 250,000,000,000 in volume. Colin Platt: This just isn't possible. Colin Platt: What they forget to say is these trades can happen all the time and it can be legitimate slow going through this where I'm buying and selling legitimately and I trade my single one tether 500 times in a day. Colin Platt: This happens a lot. Colin Platt: And these are not necessarily wash trades. Colin Platt: It could be because I'm actually trading against somebody that wants to buy or sell Bitcoin versus tether all day long. Colin Platt: And that's my business. Colin Platt: I'm a market maker or I'm just a trader and I'm actively trading. Colin Platt: So that alone doesn't, to me prove wash trading. Colin Platt: And I'm not saying that wash trading isn't a component of this, but that metric alone is something that is slightly different. Cas Piancey: Now you're talking about velocity of money, velocity of money. Colin Platt: Yeah. Colin Platt: So a lot of people point this out and they say, oh, that's not possible because they completely forget the velocity of money. Colin Platt: Now, would I wash trade tether for Tether's sake? Colin Platt: I can't see a ton of reasons why you would do it, especially in this market right now. Colin Platt: People have brought this up, particularly when we have market downturns in 20, 18, 20, 19 style where there is just less stuff happening and they want to show the exchanges are moving where I think there was a famous piece about Kraken and volumes on tether to USD because they did have that pair. Colin Platt: But now a lot of these pairs are kind of minor and they don't always exist in the same exchanges. Colin Platt: But if we see something like if I see a million dollars traded between Bitcoin, USDT or half that traded between Ether and USDT on the same exchange, I would consider them generally probably 80 90% legitimate trades. Colin Platt: And that would massively push up the numbers that we would see in something like Tether. Colin Platt: And that's because a lot of these traders are trading on very low fees and they're trying to capture a small spread and trading maybe across a couple of different exchanges using trading bots. Cas Piancey: I do want to say that when I was talking about velocity of money back in the day, I think I did a piece on it as well, the numbers that we were seeing for the velocity of money. Cas Piancey: And again, Colin did a good job of explaining this, but I just want to say for anyone who is lost on this, that velocity of money is just how many times, for instance, a single dollar bill would trade hands in a given period of time. Cas Piancey: So the more times it trades hands, the higher the velocity of money. Cas Piancey: At the time that I was following Tether adamantly, the velocity of the money for Tether was something like 1000%. Cas Piancey: Like it was something totally insane, which is not like that does not happen in normal markets at all. Cas Piancey: When you look at all other stable coins, the velocity of those other stable coins would be something in the range of like 50% to 80%. Cas Piancey: And I just checked right now and Lo and behold, tether is at 76% velocity. Cas Piancey: So it is within the range of normal velocity now. Cas Piancey: Which does point to the fact that like you said, it seems like Wash trading is less of an issue now than it used to be. Bennett Tomlin: I think that's probably a fair assessment, Cast. Bennett Tomlin: And I think a lot of things have changed in 2018. Bennett Tomlin: For one thing, the market is more liquid now in 2022 than in 2018. Bennett Tomlin: And so there's a lot less reason to try to fake things and you're a lot more likely to feel like to be outed as trying to fake things. Bennett Tomlin: Like back in 2018, when you look at the Tether numbers, they were frequently absurd, but they were often dominated by coin market cap reporting BitForex having ten times the volume of Bitfinex, right. Bennett Tomlin: And other crazy stuff like that, where the numbers being reported by the exchange were clearly not being driven by organic or meaningful flow. Bennett Tomlin: And like the you mentioned the Matt license piece on Kraken's trading of the Tether pair where he suggested that he thought there was evidence of Wash trading because it stayed so close to a dollar. Bennett Tomlin: And of course the response to that is always you'd see the same mechanism if Tether is actively redeeming and people are willing to try to arbitrage the peg. Bennett Tomlin: Like trying to look for trades at a specific dollar amount on a pegged asset is probably not the cleanest way to find wash trading because you expect the pegged asset to be worth what it's pegged at. Colin Platt: Plus or minus a risk discount or some other kind of premium or a demand premium. Bennett Tomlin: If it's more valuable to have that than the corresponding dollar. Bennett Tomlin: And so you expect it to be pretty d*** tight. Bennett Tomlin: And so I agree with you that that is not sufficient evidence on its face of like a group acting maliciously for Tether's benefit to do the wash trading to defend Tether. Colin Platt: Yeah, it's a bit like in the traditional markets. Colin Platt: Something that often gets quoted is looking at futures or ETFs on gold. Colin Platt: And it's actually funny because a few years ago and I stopped kind of following it actively. Colin Platt: But there was a lot of scandals about these big gold vaults in China, possibly not having all the gold that they claimed to have. Colin Platt: And a lot of these features in ETFs were built off of the notion that it was there. Cas Piancey: I didn't know that was a thing. Colin Platt: Yeah, it was a huge scandal. Colin Platt: I don't know what happened in the end, whether they figured out where it was or it got reconciled, I don't know. Colin Platt: But there were entire derivatives products that were built off of this that had insane volumes off the notion that this gold was sitting in a vault and you could somehow maybe redeem against it. Colin Platt: And that wasn't even always a promise, particularly with futures and particularly with China, where you have a lot of nondliverable financial products. Colin Platt: And nondeliverable financial products are super normal. Colin Platt: They happen everywhere in the United States. Colin Platt: They happen to be some of the bigger products, particularly when we talk about financial products or some of the commodities, like I was looking at cheese or dairy, you can't actually take the underlying because of some rule. Colin Platt: No, but you could still have this really high volume that didn't really speak to the velocity of it or even the redeemability of it. Colin Platt: Again, I'm not going to get into that on Tether. Colin Platt: You guys have covered that with people that are much more knowledgeable than I am. Colin Platt: But just to kind of bring up one of those weird financial factoids. Bennett Tomlin: And I mean, even in the mortgage backed security crisis, we ended up with CDOs dwarfing the size of CDs is dwarfing the size of mortgage backed bonds. Bennett Tomlin: As you go up the levels of derivative, you end up with higher nominal volumes and dollar amounts being thrown around. Colin Platt: Yes, it's easier to deal with those types of things than it is to deal with the underlying. Cas Piancey: While we're here, though, now, I think this is actually a good segue because we're talking about liquidity issues, we're talking about wash trading, we're talking about all this stuff that was at least before quite evident in the cryptocurrency markets. Cas Piancey: But Colin, you're like a big fan of NFTs. Colin Platt: I love the JPEG fan. Cas Piancey: Yeah. Cas Piancey: And something that the NFTs. Cas Piancey: Well, in a sense, don't I guess they do suffer from it, but in some sense they don't because they're supposed to be a liquid. Cas Piancey: They're designed to be a liquid. Cas Piancey: And I guess I'm wondering what you think. Cas Piancey: I wouldn't say that. Cas Piancey: Bennett and I, I don't think we hate NFPs as much as people probably think we do. Cas Piancey: It's not like we plan on ever buying them, but I don't think we hate them as much as everyone would suspect we hate them. Cas Piancey: But what do you think we're missing? Cas Piancey: What do you think we disagree with about this stuff with you? Colin Platt: Okay, let's take it back and then we can have a discussion about that. Colin Platt: Let me define why I think entities are interesting. Colin Platt: Let's start there. Colin Platt: One of the things that was really interesting to watch in the fungible crypto community, particularly happening from 2017 onwards when these things started to get popular. Colin Platt: It did happen before. Colin Platt: You had a lot of people that invested money into these and became part of a community. Colin Platt: And the joke was you either traded and made money or you lost money and you became part of a community. Colin Platt: You became a community member. Colin Platt: So it was lovingly referred to as a bag holder self help group. Colin Platt: When you get up to these Telegraph, everybody, oh, yeah, this thing's going to break out immediately and go to the moon and all this. Colin Platt: There's a lot of hope you what did actually happen out of this is you do have a lot of people that started to make friends with other people and started to talk about their favorite token and their favorite project and get to know each other. Colin Platt: You guys very different, but started to get to know each other, I guess through a token in a way, but it's creating lots of communities. Colin Platt: I'm not wrong. Colin Platt: That exists outside of the pure speculating on this thing. Colin Platt: Now, where NFC is going to come into this is a lot of people can have a financial motive, but a lot of what you really see in this NFC investment or coming into these things is people actively looking for a community, a way to relate with people on some kind of common manner, whereas they may have nothing else in common with them. Colin Platt: Pfps profile picture NFPs are really at the forefront of this. Colin Platt: So people go, I've got my ape or I've got Penguins. Colin Platt: I love Penguins. Colin Platt: But you kind of bond with people that are working in the industry or involved in the industry. Colin Platt: And people have started to form different groups talking about things that have nothing to do with crypto. Colin Platt: I saw somebody putting up they were running a whole thing about how to use Photoshop because it was somebody who knew how to use Photoshop really well. Colin Platt: And they taught people that had Penguin PFP how to use it. Colin Platt: Obviously, it's much more open than this, but they're flushing this thing through the discord. Colin Platt: People are talking when they go to conferences they meet up. Colin Platt: We need to get an Airbnb together. Colin Platt: Okay. Colin Platt: I'll go into my discord and get an Airbnb with somebody else that has a board. Colin Platt: Ape. Colin Platt: It's created a community that can exist in the real world. Colin Platt: And I think given their rise to popularity in 2028, kind of fit in with the whole COVID thing going on where people weren't leaving and they wanted to connect with the outside world. Colin Platt: I think that's quite interesting. Colin Platt: Now, that doesn't mean that they're perfect and beyond approach, but I do think that that's an interesting dynamic. Cas Piancey: Well, I do want to say two things. Cas Piancey: There one, a good friend of mine at Eat Cook, Cryptos Majin's uncle. Cas Piancey: He's awesome. Cas Piancey: And we bonded over hot sauce. Cas Piancey: That is our initial bond with him showing off his food and his hot sauce that he makes and me being like, I want hot sauce. Cas Piancey: Give me hot sauce. Cas Piancey: So I think that before NFT, there has been people whether or not we're arguing about Tether or talking about Bitcoin or talking about smart contracts, there's been people who have always been seeking out like, yeah, I'm just also looking for people to talk to about food or talk to about motorcycles or whatever. Cas Piancey: Right? Cas Piancey: I mean, I think that's long existed outside of the NFC space, but I also think that I think people probably assumed it was just simply a joke. Cas Piancey: But the way I think about NFCs is that I collect dumb Canadian s*** coins. Cas Piancey: I collect physical Canadian shit coins. Cas Piancey: And they're very stupid. Cas Piancey: Like, there's no denying how stupid it is. Cas Piancey: My most recent purchase is for 30 Canadian dollar coin. Cas Piancey: I paid like $100 for it. Cas Piancey: What the f*** is wrong with me? Cas Piancey: Right? Cas Piancey: I get that is like, okay, so clearly I'm buying something that is not actually as valuable as it suggested. Cas Piancey: And it's because I think it's fun and cool and that's it. Cas Piancey: That's like my explanation. Cas Piancey: There's no actual explanation outside of I guess I'm speculating and having fun speculating on a little pretty thing. Cas Piancey: Do you think that's like a pretty good summation of what NFTs represent? Colin Platt: I think it's very much like that. Colin Platt: The thing I like to compare NFT communities with is a country club. Colin Platt: I go in and I buy a spot in a country club by buying this NFT and showing off that I'm part of this country club. Colin Platt: And some country clubs are relatively inexpensive to get in. Colin Platt: People want to join the country club or the golf club or whatever you're into because there's a utility access to it. Colin Platt: And maybe I meet my neighbors and my friends. Colin Platt: There are some other ones that are very exclusive and very expensive. Colin Platt: And the reason I want to join it is because I will meet people that are considered higher on the social scale than me. Colin Platt: I meet CEOs, and those will cost ten times as much. Colin Platt: Nfcs have the same breakdown. Colin Platt: I'm going to go ahead and guess people that collect coins probably fall into different buckets. Colin Platt: I collected coins when I was young, and I have weird pennies from the 1920s. Colin Platt: Those probably worth a whole lot less than your brand new spanking Mint Canadian stuff. Cas Piancey: I doubt it. Cas Piancey: I don't think mine are anything special either. Bennett Tomlin: Not an investor. Colin Platt: He is more expensive than the petty that I collected. Colin Platt: But you bond with people over these things. Colin Platt: And as humans we need to bond with people and we do it over a variety of things. Colin Platt: It could be Canadian coins, it could be JPEGs, it could be Ferraris, it could be country clubs. Colin Platt: Whatever it is you're seeking to mingle with people in what's perceived as a group of the common interest. Colin Platt: And sometimes it can be aspirational and I'm willing to pay up for it. Colin Platt: One of the things that I would say is probably applies to your coins more than my country club or a Ferrari is there is an expectation that when I'm done with this community or whatever, I can sell my seat in the community. Colin Platt: I can sell all of my Canadian coins and go buy other coins or whatever. Colin Platt: Or I can sell my NFT. Colin Platt: Now that does give us, of course, a profit motive. Colin Platt: And you can say this is good, this is bad, whatever. Colin Platt: But that is one of the key differences between the pure country club or people collecting. Colin Platt: I don't know. Colin Platt: Whatever has zero resale value and no assumption of speculation outside of it. Colin Platt: I wouldn't even put in pods or anything like that in there. Colin Platt: But I guess when we were young we probably didn't try to sell Pogs on a secondary market. Colin Platt: We didn't trade them with each other, I guess. Cas Piancey: Yeah, I mean, we should have probably tried to sell them, but now they're just sitting somewhere. Colin Platt: They're probably worth a lot of money now. Colin Platt: I don't know. Bennett Tomlin: I doubt it. Bennett Tomlin: Most collectibles aren't part of my struggle with NFTs and like the more community focused Dows, which is what they're calling themselves. Bennett Tomlin: Whatever. Bennett Tomlin: I can understand joining a community around a common interest like Cas and I originally bonded over Tether and then coffee and then food. Bennett Tomlin: I played Dungeons and Dragons and have made friends playing this weird imaginary game, and so my ability to criticize people for doing weird and imaginary things is limited. Bennett Tomlin: Tell me about and look at something like the largest NFCs, like a board ape or a crypto punk or something like that. Bennett Tomlin: I don't understand what interest ties together a group of board ape yacht club holders, or what interest ties together a group of crypto punk holders Besides a belief in value accrual to profile picture NFPs? Colin Platt: Yeah, look, there's definitely no denying it. Colin Platt: That is a big undertone that people speculate on it and that does tie people together. Colin Platt: That does foster some of the early communities. Colin Platt: I think within something like a board apes. Colin Platt: I'm not in the board Abe community, but there are a lot of VCs, and there are a lot of people that are in that circle. Colin Platt: They're very famous people that have some of these. Colin Platt: Not all of it is legitimate. Colin Platt: I know that that's been pointed out. Colin Platt: But there are people that do actively participate in this community. Colin Platt: And by being in the same discord as them, you as the lonely board ape holder that got in very early but otherwise has no claim to Fame, is speaking to them on the same level. Colin Platt: They do have real in life gathering. Colin Platt: You remember the famous video in New York at NFT New York, which was quite cringe. Colin Platt: But obviously these people do enjoy getting together and being with each other in real life as they do on Discord and other mediums. Colin Platt: There's also the whole thing about lots of people say, okay, this board, they wrote something on Twitter. Colin Platt: I'm going to focus on that tweet. Colin Platt: I'm going to like it. Colin Platt: I'm going to retweet it, whatever it is that you might not do if somebody isn't in your community. Colin Platt: Again, stupid Internet points. Colin Platt: But these are the types of things that we have been taught as a population mean something to us. Colin Platt: You like to put out a tweet and have more retweets on it, right? Colin Platt: That feels good. Colin Platt: Is it worth the price of a house to have that? Colin Platt: Probably not. Colin Platt: But these are the types of things that form around the community. Colin Platt: Lots of these other ones, you do have some that are more focused on entrepreneurship. Colin Platt: There's one that I'm involved with that happens to have a lot of people in Silicon Valley who are doing start ups and different variations. Colin Platt: And you know that you can go in there and you say, hey, do you know somebody that does this or I'm hiring somebody that does this, and it's just a very good form to do that. Colin Platt: Do you need to have an NFT? Colin Platt: No, but it's kind of I don't want to say Shilling point, but it's kind of a common area that people know that they can come to. Colin Platt: And if they see this out there, they know, okay, there's a good chance that I can go talk to them. Colin Platt: And I live in France. Colin Platt: I went to a French business school, and I know that if somebody went to the same business school as me, even if they went 20 years before I went there, I can send them an email and nine out of ten times they will respond to me. Colin Platt: I guess people at Harvard probably have a similar thing, I would assume. Colin Platt: I don't know. Colin Platt: I didn't go to Harvard. Colin Platt: But that is the dynamic you have here. Colin Platt: That cost a lot of money to go to business school. Colin Platt: Right. Colin Platt: And it costs a lot of money to go to someplace like Harvard. Colin Platt: If you put in the price of pulling board apes away some of these NFTs that cost $10,000. Colin Platt: And I know that there are people in there that are successful investors or successful entrepreneurs, and I can access them for that price. Colin Platt: And there's a pretty good chance that I can resell it for about what I paid slightly more, slightly less whatever. Colin Platt: For a lot of people, that makes a lot of sense. Colin Platt: Now we can talk about money games. Colin Platt: We can talk about how realistic any of this is. Colin Platt: And I live in a small town and I was thinking about this before I called you, where people do real things and talking about these intangible things makes no sense to anybody around here. Colin Platt: I mean, people fish. Colin Platt: That's the job you do around here. Colin Platt: You fish or you build boats. Colin Platt: That's it. Colin Platt: And I lived in London before and I worked in banking. Colin Platt: I lived in New York and I worked in banking. Colin Platt: And you talk about these intangible things and it clicks. Colin Platt: It makes sense say, oh yeah, I spent $50,000 to join this NFT community because I wanted to chat with this guy. Colin Platt: I got his contact. Colin Platt: Great. Colin Platt: And then I sold it onto the next sucker that wants to do the same thing. Colin Platt: That doesn't seem as stupid as it just sounded coming out of my mouth, right? Cas Piancey: Yeah, you're making an interesting point. Cas Piancey: But I do think that there's a few issues that I think about when you talk about this stuff. Cas Piancey: Like, for instance, we had Moon Cat on and she talked about how the whole concept of how the meet and greets for celebrities are generally priced low enough or something so that at least some people who aren't hyper wealthy can still meet people like Britney Spears or whatever, and how this seems to be pricing these people out and how this seems to be like a way for people to interact with their fans, for instance, and price out the pores and make it so that only the rich people get to interact with them. Cas Piancey: And I think there's some truth to that, perhaps. Cas Piancey: And I also think you're talking about this club and the positives of being in this club and stuff like that. Cas Piancey: But we should talk about the negatives, which are quite apparent on Twitter, where we're constantly seeing people go like, my board ape is gone now or s***, I lost my board ape or I got hacked or whatever, and it happens. Bennett Tomlin: Are crypto punks actually smarter and better at Op SEC, or are they just smart enough not to say anything? Colin Platt: That's a good question. Cas Piancey: But I'm wondering what your response to these kind of like negative aspects are. Colin Platt: Okay, let me attack your question about punks. Colin Platt: Are they better at all times? Colin Platt: I would ask that not only of the NFP communities are people that hold Bitcoin that accidentally screw up and give out or ether or whatever it is and accidentally screw up and give out half a million dollars because they Typed in their password and get robbed. Colin Platt: You see a lot less now because the Bitcoin community for all of their faults is very focused on teaching each other how to do better offset. Colin Platt: But I remember seeing tons of that people going oh, I just lost half a million dollars or I know people that were out getting rugged because they were putting all this money into unauthorided contracts and losing millions and millions of dollars every day because somebody put a backdoor into their contract and didn't verify it. Colin Platt: Nobody thought to even look or they did and they didn't know what they were doing. Colin Platt: This happens all over the place. Colin Platt: It is bad that it happens. Colin Platt: We're laughing about it now. Colin Platt: But there is real financial loss from this and it is very unfortunate. Colin Platt: I would say that for a lot of people the NFT experience is their first foray into crypto. Colin Platt: They probably went in and put their first whatever money they put in on Coinbase with a credit card or a bank transfer, immediately took it out, went in and bought on open sea aboard ape or whatever, generally when the price is significantly lower. Colin Platt: I don't imagine that there's a lot of people that come in first time and spend $250,000 to buy a board a I'm sure it has happened, but I think a lot of it was back when these things were a few thousand dollars maybe, and they said hey I'll take a gamble and spend a few thousand dollars and not go to Vegas for the weekend or whatever. Colin Platt: Now because it's their first time in and because your only experience maybe was trading a little bit on Coinbase, you didn't learn a lot of these things. Colin Platt: Now I'm not singling out the board ape community as being bad, but there are, as we've seen a lot of people in that community who become quite widely known, possibly because of this effect of being in this objectively very successful project. Colin Platt: So being higher profile than some of the other ones. Colin Platt: But I'm sure it happens in random Green frog NFT number 413. Colin Platt: We just don't see it to the same extent or if it does happen and they broadcast it well, they only have three followers so nobody knows. Colin Platt: Nobody picks up on these things. Colin Platt: There are some that tend to be older and I'm going to come back to something you said about being priced out. Colin Platt: Things like punks. Colin Platt: Punks tend to skew more towards the people who've been around NFP for a while and I think that the way that punks were launched. Colin Platt: It was really never launched to my understanding as the idea to be a PFP. Colin Platt: It was just an experiment, it was fun. Colin Platt: Somebody put it out there and they said hey, we can do this just like we had crypto kitties and there was really no one time they put it out there. Bennett Tomlin: It got all f***** up and they had to put it out there a second time. Bennett Tomlin: The first one contract had some weird bug in it exactly yeah. Colin Platt: And you can have infinite mince on these things, but it was just kind of that stepping stone when we did kind of solidify these things. Colin Platt: And we had V two, even for a long time before it got popular. Colin Platt: You had people that have been around the cryptocurrency space and said, hey, this is kind of fun. Colin Platt: Oh, I'm going to use this for my Twitter profile picture. Colin Platt: You should do the same thing because you've got one of those and it just kind of naturally evolved and they by happenstance or whatever had 10,000 of these things that existed and 10,000 is quite a small number, especially when they're worth very little. Colin Platt: And people can acquire dozens or hundreds of these things. Colin Platt: That really reduces the number of hands that can help them. Colin Platt: Now everybody is doing a similar number of minutes of mid four digits to low five digit numbers of mints, mostly because of the fact that that's what punks did. Colin Platt: There are lots of them that have started to look and kind of coming back to you being priced out of these things. Colin Platt: There are attempts to kind of expand this where a project wants to do something more than just Mint and earn off the Mint and maybe some royalties for a few weeks. Colin Platt: And they're thinking, okay, well, I want to be something that's accessible and I want the worth of these things to be somewhere between, let's say, $100 and $1,000. Colin Platt: I'm just going to say that that's the market that they want to attract. Colin Platt: How many of these things do I need to put out? Colin Platt: Do I need to have a fixed number? Colin Platt: Do I need to have an expanding number? Colin Platt: If we look at things like games, maybe they're looking to target a market where an asset is worth $5 and $100, and maybe I need to adjust how many can exist? Colin Platt: Maybe they can be burnt, maybe they can be minted, depending on what's going on. Colin Platt: But I do want to have some aspects of these things that are somewhat controlled, and I think those projects will be very successful. Colin Platt: Will they aim towards where we're going currently? Colin Platt: I'd say probably not, but they will be thought out by marketing teams rather than an artist and a dad. Colin Platt: They get together and go, hey, we know this thing works, we know we can make money. Colin Platt: Let's just launch it and see what happens. Colin Platt: And most of them fail, but obviously not all of them. Bennett Tomlin: So you mention those will be where you think we're going. Bennett Tomlin: Where do you think we're going? Bennett Tomlin: What's the end state or the next state at least? Colin Platt: I have a couple of ideas where I wouldn't say that I definitely have answers or that this would even be a full picture of the market. Colin Platt: But I think things that are evolving are quite interesting. Colin Platt: Is using NFCs within different games. Colin Platt: I think the PFP community will exist, whether it'll refine down into fewer different collections that have higher numbers, I don't know, but I think that there is clearly a desire to have them where I'm personally very focused is within SVGs or scalable vector graphics being built directly into the NFT. Colin Platt: So here's the idea. Colin Platt: So Luke was kind of one of the ones that popularized this. Bennett Tomlin: Doesn't uni swap do that. Colin Platt: V Three does this as well. Colin Platt: I personally think it's quite cool because most NFTs the images that we see the JPEGs tend to live either on a centralized server someplace. Colin Platt: Maybe it's AWS or an IPFS which is kind of in the middle or some other solution, but it's definitely not on the blockchain. Colin Platt: And what that means pulling aside anything about Immutability and all that great stuff, but my smart contract cannot actually interact with this. Colin Platt: Somebody outside needs to update these things, change and whatever and pass in a new image that I now see on open sea or in my wallet with things that are on chain. Colin Platt: I can go and I can poke them with a smart contract transaction. Colin Platt: So the idea of having things that evolve and do different things or can be picked up by different contracts is quite interesting and especially if we pull it out of the Ethereum main net focus into some of these alternative L one S or L two S transactions become cheap enough that I can actually interact with these things on a regular basis. Colin Platt: And I think that that will open the door to say what other things can we do with NFTs where it's not solely about the image on it. Colin Platt: We want to create something more and maybe that's extrapolated into different layers that may have nothing to do with the blockchain, but we still have this kind of base asset that we can come back to. Colin Platt: We can pull apart, we can share, we can put into a Dow and vote about what happens with it, whatever you want to do. Colin Platt: But it starts to become a building block rather than the end state which we currently view something like a PFP as. Bennett Tomlin: Okay, so what you see is the next evolution is NFTs that it sounds almost like in many respects they'd be small smart contracts themselves with configurable parameters that can be called by agreed upon signed whitelisted wallets or stuff to change parameters to change features of these NFTs. Bennett Tomlin: Is that what you're describing? Bennett Tomlin: Just make sure I understand it. Colin Platt: Yeah, basically. Colin Platt: So think about it. Colin Platt: As 2017 ICOs were to defy, I think PFP will be to whatever comes next in NFPs being able to do things that are more interesting than just speculating on the price going up and down or setting them as your Twitter profile picture. Cas Piancey: There's so many people who are putting forth use cases that I just don't get though. Cas Piancey: Like there's a lot of people saying stuff like it'll change ticketing forever. Colin Platt: And I'm like why I just bought a ticket for the ECC conference in Paris in July and they use this NFP platform and it was just an awful experience to use it. Colin Platt: I would wish that on no one. Colin Platt: They tried to their credit, but there's all kinds of problems with it and maybe some teething problems. Colin Platt: But I agree with you, and I first got involved in crypto in 2014 and 2015 and I worked at a bank and of course banks all wanted to talk about blockchains at the time. Colin Platt: And I remember reading these articles and it was a common joke, can blockchain solve X? Colin Platt: And of course it could solve whatever, it could cure cancer, it could alleviate poverty, it could solve wars amongst countries, whatever it was. Colin Platt: Actually, people are still talking about that, but there are a lot of people that don't understand what they're talking about and have no subject matter expertise, and they are shillfluenccers or whatever they are. Colin Platt: And we listen to them for some reason about things that are highly technical and highly complex or very limited in what they can deliver. Colin Platt: And I think David Gerard, you guys had on he was very active during the blockchain time saying, well, this thing is to functionally a linked list, right? Colin Platt: And if you just want to put a blockchain in there, you want to put a link list in there, you're not actually changing the problem. Colin Platt: The problems you have are bigger. Colin Platt: And outside of that, it's not how you save data. Colin Platt: And I would say the same thing about NFPs. Colin Platt: I remember you were criticizing not too long ago, people saying, oh yeah, you can put words. Colin Platt: And what was it, journalism inside of NFTs and things that have no grounding in reality, how does that change anything? Bennett Tomlin: Which I think in a sense almost connects us back to some of the ICO culture problems that PTK was trying to point out. Bennett Tomlin: A lot of people turn to ICOs not as a technical solution, but because it offered this really easy way to get immediate liquidity, to get this investment, to get this liquidity, to be able to sell these things and have a secondary market for these things without having to build it yourself. Bennett Tomlin: So you hear people say things like NFTs will be great for tickets, not because it solves any of the inherent ticketing related questions, but because it makes it easy for people to sell their tickets. Bennett Tomlin: And I think that even in some sense consistent, Colin, with what you were describing as one of the advantages of NFT for this kind of community thing is that you are effectively purchasing a seat at the table of this community. Bennett Tomlin: And when you no longer want to be a part of it, there's already a way for you to sell that and leave without there having to be the more messy human processes if you're having to negotiate with other people to figure out how to do that. Bennett Tomlin: And so a lot of times our criticisms around blockchain NFPs, Dows and all these things is the technical solution you're using isn't solving any of the problems you claim you have, because the problems they're claiming they have are not the problems they actually want to solve. Bennett Tomlin: Like many of the ICOs weren't interested in using blockchain to solve a problem, they were interested in creating a resaleble token. Colin Platt: You're definitely absolutely right for a very large number of ICOs. Colin Platt: But I think that there were a lot of projects who shoehorn a token, whether it's an NFP or fungible token in there, because they have an idea that they truly believe in and they need to raise money to execute on this idea, and they find a way to make the NFT or the blockchain or whatever it is fit into what they're doing, even if it's not necessary. Colin Platt: But I wouldn't necessarily say that this is an act of bad faith. Colin Platt: I might be trying to build a random fisherman down here needs to buy a new boat. Colin Platt: So he's going to tokenize and make a Dow out of his boat because he knows that he can raise the money. Colin Platt: Do I need a token represented ownership of the boat down here that the fisherman is using? Colin Platt: Absolutely not. Colin Platt: But he knows if he goes to the bank, they're going to spend weeks and weeks and weeks and maybe they'll loan him money, whereas he knows he can go to the crowd and get this money. Colin Platt: And I think something that often is overlooked. Colin Platt: Back in 2017 and 2018, we had ICOs in places like China. Colin Platt: We also had the explosion of crowdfunding, and that wasn't something that was really popular in the US to the same extent as places like Europe and Asia. Colin Platt: But crowdfunding going out, raising $5 from a million different people was really popular. Colin Platt: And I think that that's something that ICOs are just another extension of, albeit with less regulation. Colin Platt: And NFTs are another way to do that. Colin Platt: Again, you're right. Colin Platt: It's not necessary. Bennett Tomlin: I will certainly concede it's not necessarily bad faith, but in the vast majority of cases, I can recall reading at least some point in their white paper documentation or marketing materials. Bennett Tomlin: They lie about what the thing is capable of doing. Bennett Tomlin: And so as soon as they do that, I dump it in the bad faith bucket. Colin Platt: And that's very fair. Bennett Tomlin: I understand why they do it. Cas Piancey: Well, I want to say that you're talking about crowdfunding projects, and if you want to talk about an industry rife with fraud, I think look no further than crowdfunding projects. Cas Piancey: To me, if I go right now and look at the list of highest funded crowdfunded projects, EOS top of the list. Colin Platt: I think we can all agree that that is there's a lot of crossover between crowdfunding and tokens, right? Colin Platt: Yeah. Cas Piancey: At best, attempt at trying to create a new blockchain. Cas Piancey: At worst, it was definitely a cash grab. Cas Piancey: So I think that's number one. Cas Piancey: But then number two, you have star citizen number three file, coin number four, Tezos number five, the Dao number six. Colin Platt: That was great, by the way. Cas Piancey: Yeah, that worked out really well. Cas Piancey: But we can look outside of the blockchain things which are all showing up here and have done miserable. Cas Piancey: I don't even know what this is. Cas Piancey: Status. Cas Piancey: What's status do you guys remember? Cas Piancey: Status. Colin Platt: Status. Colin Platt: I am. Colin Platt: Right. Colin Platt: I don't remember what they do. Colin Platt: But there's something to do with crypto. Cas Piancey: Do they do anything anymore? Cas Piancey: Lucid Motors, scams up and down, as far as I'm concerned, not to call none of these. Cas Piancey: I'm not actually expressing that any of these are scams. Cas Piancey: But as far as I'm concerned, these all sound bad. Cas Piancey: And I'm just wondering. Cas Piancey: So if we're trying to fix it, how is blockchain going to help fix what is obviously a problematic industry? Colin Platt: Okay, so let me break it into two parts here. Colin Platt: A basic tenant in modern finance and banking is that money will flow to where it's cheapest. Colin Platt: Right. Colin Platt: This is exactly why central banks lower interest rates. Colin Platt: They want to stimulate credit. Colin Platt: They want people to go out and spend money. Colin Platt: Right. Colin Platt: You have the same thing that exists of raising money from public markets. Colin Platt: If I know that all I need to do is put up a three page white paper and I can raise half a million dollars to accomplish whatever I'm trying to accomplish. Colin Platt: Assuming I'm trying to accomplish something that isn't just outright fraud, I want to take your money and deliver you nothing. Colin Platt: That is one bucket. Colin Platt: Right? Colin Platt: But there are people that are trying to do something. Colin Platt: And this is what I was saying where I would argue with the faith. Colin Platt: They're trying to create something and they believe in what they're trying to do. Colin Platt: And it is an honest attempt. Colin Platt: It may be a flawed attempt and it may be doomed to failure. Colin Platt: But as somebody that needs to go out and raise half a million dollars to see my vision out, and I work every waking moment trying to accomplish this vision, even if it's never going to take off because I'm trying to make a condom for a dolphin, I don't know, something stupid like it doesn't mean that using crowdfunding is a bad idea or is directly fraudulent. Colin Platt: It's just a dumb idea. Colin Platt: And I went to the easiest place that I know if I could get money and I would have gone to the bank or borrowed it from my friends and family if they gave me the money. Colin Platt: Right. Colin Platt: It's just there. Colin Platt: It's just a dumb idea that happens to use the easiest available means. Colin Platt: Now, coming back to the second part of it, how does a blockchain solve my new business of putting condoms on a dolphin? Colin Platt: I have no idea. Colin Platt: But there are people that out there that can put together things that they may be heard from somebody else that didn't understand the blockchain. Colin Platt: And through Chinese whispers, I need to put some kind of like provenance technology on the latex when it came out of Malaysia before it got put on the dolphin. Colin Platt: I don't know. Colin Platt: But there are people out there that definitely want to do that, and that adds some kind of value and it makes the product at least makes sense to the other people that are willing to put their hard earned money into my business of putting condoms on Dolphins. Bennett Tomlin: It's Long Island blockchain. Cas Piancey: It's unfortunate that so many people want to put condoms on Dolphins, too. Cas Piancey: That seems like a weird thing that I can't believe that's such a popular cause. Bennett Tomlin: It can't be good for the dolphin population. Cas Piancey: Yeah, I thought they were endangered. Bennett Tomlin: Colin, why do you hate the Dolphins? Cas Piancey: Why do so many blockchainers want to support this project? Cas Piancey: I'm so mad right now. Cas Piancey: I mean, honestly, Colin, I wish that we had more Coiners like you. Cas Piancey: I just think that there aren't. Cas Piancey: I think as many as you would suggest there are that acknowledge that a lot of this is just pure hype and speculation. Cas Piancey: And that's kind of the fun part. Cas Piancey: If more people were willing to admit that, I think, BT and I would have a lot less of a problem with a lot of people. Colin Platt: So it's my job to go out and convince everybody to tell you that they think that the hype is the fun part. Bennett Tomlin: It'll make our life easier. Bennett Tomlin: And this is what's important. Colin Platt: I do have a good solution to how we do this. Colin Platt: We're going to set up a dial. Colin Platt: We're going to issue a token. Colin Platt: We need all the money for advocacy. Colin Platt: Of course. Cas Piancey: Thank you for joining us calling. Cas Piancey: I don't know if there's anything else you wanted to throw out there before we call it just buy PTK. Colin Platt: Yeah. Bennett Tomlin: Good luck finding anyone willing to part with it. Colin Platt: I wonder if I'm even still able to access the wallet. Cas Piancey: Right. Cas Piancey: Well, that's classic. Cas Piancey: You and Josh and everyone else always seems to lose the wallet keys of the scam that you've created. Bennett Tomlin: But hey, it's the secret to True Diamond. Colin Platt: An unfortunate boating accident. Cas Piancey: Yeah, that's right. Cas Piancey: But everyone probably knows if they follow me on Twitter. Cas Piancey: You did promise me a baguette as payment for this. Cas Piancey: And then DMZ, you did say. Colin Platt: I'm glad you chose that. Colin Platt: It's good and fair of you. Colin Platt: So come right out to France and I will make sure that you were delivered with baguettes all you want for the entire time you're here. Cas Piancey: It's a deal. Cas Piancey: And now people understand that we do accept payments for guests to come on, but usually it's going to have to be food related payments. Cas Piancey: So, yeah. Cas Piancey: Thank you. Cas Piancey: Thanks again, Colin. Cas Piancey: And what a joy to have. Colin Platt: You got to watch out now because people are going to want to advertise and actually send you caviar and champagne. Colin Platt: Right? Cas Piancey: Hey, I'm not going to say no to caviar. Cas Piancey: You also might not get I'm not confirming for anybody that if you send us food you're getting on the podcast but it wouldn't hurt so go ahead and send it. Bennett Tomlin: I mean we'll gladly accept food if you're like an ICO who thinks that sending us caviar and champagne to get on the show is going to result in an episode that makes you look good and brings in new investors you might want to reassess your prior and send the stuff. Cas Piancey: Go ahead and send it anyway but. Cas Piancey: You'Ll take acceptance before you have the one that's right in a peace offering to the Cryptocurrency blockchain and NFT communities. Cas Piancey: Crypto Critics' Corner is going to be doing an NFT marketplace on cryptocriticscorner.org. Cas Piancey: It's going to be amazing. Cas Piancey: We want to help support the causes that you guys care about so we're looking forward to putting condoms on these Dolphins. Cas Piancey: If it's important to Colin, it's important to us. Cas Piancey: We're looking forward to releasing that in quarter six of, 2029, wait quarter six.