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On the VC private vs. public market arbitrage in crypto
In Hong Kong, Sam and his small team began to pitch the billionaire founders of existing exchanges on the idea of paying Alameda Research (Gary) to create a crypto exchange, different in important ways from any that existed. Alameda would supply the technology; the existing exchanges would supply the customers, and the trust.…
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Michael Lewis • Going Infinite: The Rise and Fall of a New Tycoon
In their willingness to court the wrath of US financial regulators, the crypto exchanges fell into one of at least four categories. A small group of tiny US exchanges listed only bitcoin and ether, the two oldest coins, blessed by the SEC as commodities and openly regulated by the CFTC. (A bit oddly, the older the coin, the more people thought of i
... See moreMichael Lewis • Going Infinite: The Rise and Fall of a New Tycoon
In contrast, crypto token sales can occur and you don’t know the name of a single person involved. Any investor can buy in—all they need is a wallet. To make it even weirder, the system of record is on the blockchain, so every single movement of value is publicly viewable—despite participants being entirely anonymous. Meaning that anyone with suffi... See more
Every • Will Tokens Replace Equity?
This happens slowly because while public markets trade daily and prices then adjust instantly, private markets don’t get reset until follow-on financing rounds happen which can take 6–24 months.