15 ms·

Crypto Fund II

186 points by momentmaker 6y ago

deleted 6y ago
[deleted]
swyx 6y ago
do we know anything about the performance of Crypto Fund I so far? i'm really curious what kind of GP throws good money after bad on out-of-favor stuff like this. not that it can't work, its just unusual. one whole thesis here is "Modern Store of Value". is Crypto Fund II just gonna put 25% in bitcoin? "New Ways for Creators to Monetize". i feel this is the weakest thesis of the lot. i dont see how decentralization helps here. alright im done being crabby hn commenter. good luck to cdixon and katie haun, and the people actually trying to invent the future.
- arcticbull 6y ago
  > do we know anything about the performance of Crypto Fund I so far? Bad. Very, very bad. > i'm really curious what kind of GP throws good money after bad on out-of-favor stuff like this. not that it can't work, its just unusual. Crypto is at the intersection of ancaps and difficult, probably intractable engineering problems. That intersection is highly idealistic and highly motivated, with an almost religious zeal.
  - xiaolingxiao 6y ago
    Could you provide details on how you know it’s bad? I’m not a big “believer” in crypto, but investments can do well on an IRR basis for many years before things go south. See we work in 2017... in crypto, have the companies they investments been marked down?
    - arcticbull 6y ago
      Well, the best performing token is down 8% from ATH (and it launched this morning) and the worst is down 98.59% [1]. All this is leading me to believe they're a poor investment vehicle. [1] https://athcoinindex.com/ https://athcoinindex.com/
      - nemothekid 6y ago
        a16z isn't investing in coins. I don't know if Coinbase was in Crypto Fund I, but it if it was, then I don't think Fund I could have done too bad.
        arcticbull 6y ago
        Are you sure about that? The Winkelvii sure did. Plenty of funds were set up solely to invest in various coins. Why would a16z be any different?
        enginar 6y ago
        I think they have invested directly in cryptocurrencies (that is why they decided to register as an RIA), along with a range of other bets that include Coinbase, Compound and Anchorage.
        mhluongo 6y ago
        It certainly is. They put in quite a bit into Maker and Dfinity, for example.
      - thesausageking 6y ago
        You can't project a16z's performance based on what happened on exchanges. During the ICO boom, they got access to tokens before they ICO'ed, usually at 70-90% discounts. They also make a lot of equity investments into the companies behind the protocol. I have no idea what their numbers look like right now. And it will be hard to judge as most of their investments are illiquid at this point and don't know how they'll work out. Chia, Filecoin, Libra, ... haven't launched so could end up being worth a lot or could be worth 0.
      - fraggle222 6y ago
        Silly to look at % down from ATH when we had a massive bubble that peaked and popped. If you look at return overall, crypto beats ALL stock market investmets.
        arcticbull 6y ago
    - three_seagrass 6y ago
      The crypto fund or cryptocurrencies in general? Most cryptos (that are not ICO scams) are hammers looking for nail. Outside of some very niche use-cases, most are non-competitive with centralized payment systems. Keep in mind there is a difference between an investment vehicle and a currency, and just about anything is a decent investment if your risk tolerance is high enough. The fervor by which they're pushed by fans is almost religious in that their arguments stem from asking you to ignore certain facts and have faith, usually in the holy whitepaper.
      - dehrmann 6y ago
        > hammers looking for nail Blockchain tech, specifically is this. There are a handful of interesting, viable use cases, but most are solved better in other ways.
      - arcticbull 6y ago
        > ... their arguments stem from asking you to ignore certain facts and have faith, usually in the holy whitepaper. As the scriptures of the great Satoshi Nakamoto [1] foretold, the bankers are coming to steal our net worth through inflation. Therefore, help me move my narcotics proceeds overseas. [1] (Satoshi is likely the international narcotics and arms trafficking, real-life, super-racist Bond-esque villain Paul "Solotshi" Calder Le Roux: https://www.wired.com/story/was-bitcoin-created-by-this-international-drug-dealer-maybe/ https://www.wired.com/story/was-bitcoin-created-by-this-inte...)
  - api 6y ago
    > Crypto is at the intersection of ancaps and difficult, probably intractable engineering problems. That intersection is highly idealistic and highly motivated, with an almost religious zeal. There's another reason too: faulty reasoning by superficial historical analogy. There's a crowd of people who think cryptocurrency resembles the early Internet, and that its detractors are wrong in the same was as Paul Krugman was when he thought the net would turn into nothing. The difference of course is that the Internet was immediately useful to an exponentially exploding number of people. I got on the net in 1993-1994 as an early teen and immediately found a ton of fascinating stuff to do with it. I helped less tech-savvy people (including my step sister) get online and they started enjoying chat rooms and the very early web. Nobody uses cryptocurrency except users in a few niches that have remained relatively stable since its inception: people using it as an alternative wire transfer method, black/grey market commerce, and enthusiasts who just think it's cool and go out of their way to use it for the sake of using it. Those niches exist but they aren't growing very fast. Reason from first principles, not by analogy.
    - Jd 6y ago
      Having a forum where people discuss tech trends with an explicit commitment to reasoning from first principles would be very interesting, especially if it had cross over to physics and other sciences.
    - DennisP 6y ago
      If you want to see what corporations are actually starting to use public blockchains for, check out the keynote from the EY blockchain conference last week: https://www.youtube.com/watch?v=-ycu5vGDdZw&t=14m https://www.youtube.com/watch?v=-ycu5vGDdZw&t=14m Essentially, EY expects public blockchains to do for B2B what ERP software did for internal operations. They're building zero-knowledge tech to make that sufficiently private and help with scaling.
      - arcticbull 6y ago
        > Essentially, EY expects public blockchains to do for B2B what ERP software did for internal operations. They're building zero-knowledge tech to make that sufficiently private and help with scaling. Yes, but it's totally and completely unnecessary. If a company doing business with another company doesn't trust either the other company or a mutual jurisdiction to remediate -- they just shouldn't be in business together. No amount of blockchain magic fairy dust is going to change that. Blockchain also only accurately reflects things solely encapsulated within the blockchain. As soon as you're trusting someone to enter data they can enter false data, and now you've got a permanent immutable ledger of hot garbage.
- timerol 6y ago
  Credit card transactions generally take 2.9% + $0.30, which completely removes the possibility of making money on micropayments. Theoretically crypto should enable lower-fee transactions which could enable micropayments. I say that, but a transaction on the Bitcoin ledger has been more expensive than $0.15 since mid-2016 and fluctuates wildly. Other cryptocurrencies might be able to handle this better. I'm optimistic about Stellar being a useful transaction network, but I don't think the value of 1 XLM is going to move much relative to 1 USD.
  - zionic 6y ago
    IF... and I stress IF ETH 2.0's sharded blockchain system works then we'll see a 64x increase (from 64 shards) in throughput on launch with a roadmap to scale to 1000 shards. The gist of it is you have a "multi core blockchain" that is only verified by a randomly chosen subset of validators that then sync their state back up to an oversight chain called the beacon chain.
    - sq_ 6y ago
      I'm not up to date on ETH, but is this the same fabled upgrade that people have been talking about for years now? The concept sounds like it could have real potential.
      - DennisP 6y ago
        Yep that's it. As of now they have a multi-client testnet running a near-final version of the beacon chain, using proof of stake. Assuming all goes well, they'll launch for real later this year. The sharding design is integrated with that but won't actually be implemented until next year. First version of sharding will only store data; execution on shards will be after that. The other thing going on is various layer-two systems called "rollups" which compress on-chain data to a minimum and prove its validity with either fraud proofs or a cryptographic zero-knowledge proof. Some of those are in or near production and can take today's Ethereum to about 2000 tx/sec, for simple transactions like transfers and exchanges. The data-only phase of sharding will multiply that by the number of shards.
- tphyahoo2 6y ago
  https://lightning.engineering/posts/2020-03-30-lsat/ https://lightning.engineering/posts/2020-03-30-lsat/ finally, a sane solution for micropayments for content. you can see a sort of proof of concept (pre-lsat, but using lightning) on yalls.org and a few other similar toe in the water type sites. but I think if LSAT gets traction it has the potential to turn the content industry upside down. it is still very very early days.
  - dylkil 6y ago
    The lightning network whitepaper states a block size of 155mb is required for lightning to work at scale. Bitcoin has a 1mb block size with no hope of it ever increasing. I dont see this as a solution at all.
- tempsy 6y ago
  I wonder if crypto qualifies as “building” per essay...
chrischen 6y ago
Online payment fees come from fraud, chargebacks, and credit card points/benefits. I don’t see how crypto solves the fraud problem. Sure there will be lower fees, but higher risk of fraud.
- crazydoggers 6y ago
  It puts fraud mitigation in the hands of the parties involved. Often times this can be done via escrow. There are an enormous number of use cases where escrow works, or even where fraud is of no concern (transfers between trusted parties). For cases where fraud is a concern, third parties can step in and charge appropriate fees. Crypto provides a lot more flexibility in your choice of payment process than credit cards.
  - thoraway1010 6y ago
    I've heard some horror stories about escrow. Bad wiring instructions in/out (intercepted emails), bogus escrow companies. Glad to hear these crypto folks have figured it out.
    - worik 6y ago
      Optimist
      - not_really 6y ago
        What does this comment make you?
  - jkhdigital 6y ago
    Exactly, payment security is now entirely in the hands of the merchant. Whether this is preferable to existing payment systems is unknown at this point, but it's hard to make a compelling argument either way. Furthermore, credit cards aren't just payment methods--they represent credit extended to consumers by banks. This actually influences the money supply, since (1) consumers can potentially carry unsecured debt balances, and (2) consumers have less need to park money in savings since credit cards provide access to liquidity. In other words, there are a lot more factors in play here than just the transaction fees and fraud mitigation mechanisms.
Fede_V 6y ago
This is so incredibly ironic after the call to build stuff in the real world. As I posted at the time (https://news.ycombinator.com/item?id=22913860 https://news.ycombinator.com/item?id=22913860) - talk is cheap, let's see where they put their money before we compliment them. I guess we've seen it now.
PanosJee 6y ago
Where are the companies from Fund I? Didn't they invested in Telegram. How did that go?
- wmf 6y ago
  It looks like the Telegram pre-ICO is going to convert into Telegram equity which is what the VCs wanted all along. https://www.coindesk.com/telegram-caves-to-us-regulators-delays-blockchain-launch-offers-to-return-1-2b-to-investors https://www.coindesk.com/telegram-caves-to-us-regulators-del...
- Traster 6y ago
  Telegram seems to be very successful, they've really picked up some big names using their app. Like Milo, and Jacob Wohl and Sargon of Akkad...
some_furry 6y ago
I'm disappointed to see that none of the Crypto Fund II is slated for Cryptography, but instead only to Cryptocurrency. Obligatory: http://www.cryptoisnotcryptocurrency.com http://www.cryptoisnotcryptocurrency.com There's a lot of important problems in (and around) cryptography that need solving. To be charitable: Maybe some of them can be solved by cryptocurrency projects? There is some precedent here. (Zcash advanced the state of the art for non-interactive zero-knowledge proofs and pairing-based cryptography, Monero demonstrated real-world ring signatures, etc.) But more importantly: There are a lot of possible solutions that need an incentive to be developed, and could potentially become profitable start-ups. But it's sad to see that cryptography (a.k.a. the real "crypto") isn't even a seat at the table calling itself "Crypto".
- tptacek 6y ago
  The point of a venture fund is not to advance science.
  - some_furry 6y ago
    I worded my comment weird originally, hopefully my meaning is clearer now.
    - tptacek 6y ago
      This to me is a little like wondering why distributed consensus doesn't have a seat at the table in other venture funds; there's important work to be done in scaling databases, too! But venture funds fund businesses. If you come up with a business with social proof that there's a plausible (if remote) chance of 10xing based on an advance in cryptography, you'll stand a chance of getting it funded. Just not by this fund, which has nothing to do with cryptography or, for that matter, virtually any normal business.
      - some_furry 6y ago
        > This to me is a little like wondering why distributed consensus doesn't have a seat at the table in other venture funds; It would be a little like that, if the funds were called "Distributed Consensus Fund II" (or some common abbreviation thereof). > Just not by this fund, which has nothing to do with cryptography or, for that matter, virtually any normal business. And thus, in my mind, it should be named appropriately. The current name is wrong.
arcticbull 6y ago
> Unlike existing systems where the sender and receiver must have fee-extracting bank infrastructure in place, payment blockchains require no bank account, thereby opening up financial services to the two billion-plus unbanked worldwide. Unlike existing systems where you have recourse to recover your payments if anything goes wrong, blockchains leave you hanging and at risk of fraud and even simple coding mistakes, thereby opening up financial services to the modern-day robber barons of the world -- and less efficiently than ever. Thus solving payments, once and for all. ONCE AND FOR ALL. Less tongue in cheek, here I was naively hoping we'd gotten over all this. Twelve years of attempts to advance this technology with absolutely no break-out successes, but hundreds of high-profile seemingly obvious failures. Alas, sounds like we're winding up for round 2.
- htrp 6y ago
  its interesting how crypto ends up rediscovering principles in banking/ traditional finance
  - arcticbull 6y ago
    Speed running the history of finance.
deleted 6y ago
[deleted]
htrp 6y ago
iirc they went all in on the exchanges? problem is none of them were able to ride the crypto wave to an ipo
jkhdigital 6y ago
Can we drop the whole "blockchain" shtick and just start calling this space "crypto"? Bitcoin combined a cryptographic protocol with an incentive structure to produce something incredible: digital cash that can be held and transacted without a central authority. The innovation was in the combination of protocol components, not the data structure that resulted ("the blockchain"). The problem that we're actually trying to solve with all of this is how to provide a root of trust. Blockchains are a way to do that, but I've yet to see a compelling use case beyond digital cash. Attempts to implement any transaction more complicated than cash settlement on a blockchain will inevitably run into the fundamental problem: transactions are contracts, and contracts will always require a legal framework and judicial system to mediate. You simply can't remove that requirement and all of the "inefficiency" that comes along with it.
- craze3 6y ago
  No, because "crypto" is only a subset of "blockchain." Blockchain can be used for a lot more than just digital cash. It can be used for storing immutable logs of any data/content. That implies endless use-cases. Yes, transactions can be viewed as contracts, but the mediation is already accounted for by that specific blockchain's consensus algorithm & proposal/dispute resolution system. Most of the good smart contract blockchains already have systems in place for all this.
  - jkhdigital 6y ago
    You've got it backwards, "crypto" is cryptography which is where all of this comes from. "Blockchain" is just a clever combination of ECDSA, Merkle trees and partial hash inversion that has proven useful to implement decentralized digital cash. I think we would be better served by looking at existing real-world problems with fresh eyes to see if cryptography can provide unique solutions, rather than taking one particular protocol template and assuming it can be used for almost anything.
    - tromp 6y ago
      > "crypto" is cryptography It ought to be, and it used to be, but unfortunately it's been hijacked by the cryptocurrency community to such an extent that it's become increasingly ambiguous. > ECDSA or, preferrably, Schnorr signatures. > partial hash inversion There's more to mining than hashing [1]. [1] https://cryptorials.io/beyond-hashcash-proof-work-theres-mining-hashing/ https://cryptorials.io/beyond-hashcash-proof-work-theres-min...
rl3 6y ago
If only there was a way to directly pitch A16z without the connections. Some of us crazy people are consumed by Web3 ideas so much that we spend years thinking about it full-time aren't necessarily the most social or well-connected people. Creating an MVP for a vertically-integrated company that's carefully designed to rip the guts out of the entire existing tech monopoly is extremely difficult at best. Applying with large-scale ideas like this to YC as a solo founder without an overachieving background offers an almost infinitesimal probability of success. Likewise, it'd be cool to see pre-seed funding from these types of initiatives. I'd love to spend another year or two just refining the notes generated by tens of thousands of hours of thought into a cohesive design document. It's so much content I'm having to create a custom spatial interface to map and organize it all into a kind of living design doc. I suppose the point is that the deep thought required to envision things like this is at odds with creating a personal brand or playing the traditional traction-based startup game. Some of us are just out there in left field, alone. We want to bring incredible amounts of value to the table, but it's very difficult to do so.
- craze3 6y ago
  I would look into getting a head start by leveraging one of the existing blockchain companies that's looking for developers to build on their platform. Usually they are very happy to promote your project(s) on their social media, and/or offer you seed/bridge funding if you can create a compelling MVP. I would also urge you to look for the blockchain companies that are hosting hackathons, since that means they have money to blow on attracting developers. I know all this since I'm in the same boat as you :) Good luck!
  - rl3 6y ago
    Blockchain isn't required for an MVP, so I am fortunate in that regard. You know, it's funny to watch Silicon Valley years ago and laugh at the "new internet" part. Then realize shit, I've actually become this person now. :) Appreciate the advice and kind words, best of luck to you as well!
  - woah 6y ago
    This is an amusing truth in the industry. The VC's have given much of their money to "layer 1" blockchain projects that are supposed to have lots of application projects building on them. But VC's aren't investing as much in application projects, since there often isn't a clear path to profitability with a decentralized application. A big reason for this is that the layer 1 blockchain will capture most of the value of the applications running on it (for a real life example of this, see Uniswap on Ethereum). At the same time, the success of a layer 1 blockchain is judged by how many applications it has. So maybe one could argue that applications are valued more highly by VCs for enhancing the appearance of success of layer 1 blockchains than for their own sake. This leads to the situation you portray, where it's sometimes easiest for a founder to get investment money from VCs that has first passed through the hands of a layer 1 project.
ve55 6y ago
>Transferring actual value quickly and cheaply without a third party, in much the same way we currently transfer data like emails or photos, Do we actually do this that often, though? Email and photo sharing are generally dependent upon third parties, and generally extremely centralized and powerful ones, such as Google or Facebook or Twitter. Very little Internet communication goes directly from one person to another.
- vngzs 6y ago
  I think AirDrop works without a third party, but email passes through numerous hops - often in plaintext on the open Internet - before arriving at an inbox. Maybe encrypted messaging like Signal is a better analogy. Yeah, it still passes through a third party, but they can't read it.
  - ve55 6y ago
    That's a good example, it's important not to be too pedantic with the definition since everything passes through middleboxes, or at least WiFi/routers or switches. Even so, it seems like the apps that are the most centralized often have the most communication volume, and things like Signal and AirDrop, as nice as they may be, are largely outliers. This is especially the case when we look at group communication, where many participants are involved (Reddit, Twitter, Slack, Discord, etc). I find it very hard to have private group conversations on the Internet due to these platforms, as almost every community is stuck on a completely centralized+proprietary solution by now.
- xkjkls 6y ago
  And do we not want a third party? Honestly, I like the security of knowing that most of my transactions are reversible within the context of the legal system.
  - chrisco255 6y ago
    You don't have to do 100% of your finance on blockchain. I like the freedom of knowing that my funds cannot be controlled by any third party entity, who may object to my spending on the basis of some arbitrary criteria. We've seen people shut out of PayPal for very arbitrary reasons. We've seen the marijuana industry in Colorado shut out of banking (https://www.acams.org/aml-white-paper-marijuana/ https://www.acams.org/aml-white-paper-marijuana/). If centralized entities can control your spending, they can control you. That's one of the core arguments for decentralized finance. As for transaction reversibility, I am sure that a payment insurance program will crop up in the not-too-distant future to alleve those fears.
lalaland1125 6y ago
It seems to me like 99% of the aims in this document could be achieved by a competent and efficient non-profit bank that offers a good API. Let's Encrypt is a similar example of how a cheap and effective competitor can really improve things in a space fraught with inefficiency. Why don't we create a Let's Encrypt for banking rather than fiddle around with frankly unnecessary technology?
- creed98 6y ago
  Mmh haven't seen too many credit unions do this. Though groceries and netflix are not paid by api but credit card
kauffj 6y ago
If anyone is interested in the intersection of Web 3.0 and Creator Monetization, you might like LBRY. The core idea of LBRY is to make YouTube-like experiences possible without Google (alternatively, to fix the discovery, incentive, and legitimacy problems of BitTorrent). https://lbry.com https://lbry.com (consumer portal) https://lbry.tech https://lbry.tech (tech portal) https://lbry.tv https://lbry.tv (web app) We were also just mentioned on HN in Andy Baio's article on Deep Fakes: https://news.ycombinator.com/item?id=23011445 https://news.ycombinator.com/item?id=23011445
freyrs3 6y ago
You have to appreciate the audacity of some of the portfolio companies in Fund I for getting away hilariously bad business models. They literally fleeced Chris Dixon into funding Pied Piper (dfinity.org) and crypto kittens and he actually bought it. There's definitely some massive sunk cost effect going on with this new fund on a scale we haven't seen before. Anderssen used to be the smart money in VC and now they're doing this fund.
chrisco255 6y ago
The advances happening in Decentralized Finance right now are very important and will power the financial infrastructure of the 21st century. This space is rapidly evolving and is undergoing a Cambrian explosion right now, which is super fascinating to watch. Having been there for the dot com era and the mobile era, this feels the same. If you're in technology, it's worth educating yourself on this space. Two of the best resources I've found are: Bankless Newsletter & Podcast: https://bankless.substack.com/ https://bankless.substack.com/ The Defiant Newsletter: https://thedefiant.substack.com/ https://thedefiant.substack.com/
- barnabee 6y ago
  Not sure why this is downvoted. It’s clear if you spend time at the right conferences, read the right papers, and talk to the right people that $billions can eventually be saved and risk massively reduced / much better understood and managed, if not by the specific “DeFi” protocols people are using on Ethereum now, then by the things that will come to follow them. The potential upside for the bets that come good is worth a lot of losers — VC is very asymmetrical. Maybe this will all fail but there aren’t many good arguments why. (Yes, you can build all the fraud protection, account recovery, regulatory compliance features that you might need into these systems when the time comes, if that’s what it takes to realise the other benefits — arguments about this are at least 5 years too early.) I remember when building on or investing in Linux was a waste of time because it was a toy and would never be used for anything serious. The truth is, things are still very early — the internet has its roots in the 1960s, we are perhaps where the internet was sometime in the ‘80s with crypto (still an accelerated timeline!). Be very cautious of extrapolating from what can be done now (in crypto, quantum computing, biotech, AI, wherever). Unless you’ve spent months or years researching and piecing things together and know what is actually possible, it’s just possible that there are aspects that you don’t fully appreciate.
jgalt212 6y ago
I've been a crypto bear/skeptic for a long time, but given how much cash the Fed has pumped into the market and their general reluctance to take cash out of the market, we could be set up for some pretty intense inflation if/when there is a U shaped recovery. As such, I'd be looking to buy inflation protection where you can these days: gold, BTC, TIPS, etc.
kryptiskt 6y ago
I wonder why the fund is themed after a technical solution, and not industry or anything else. It's not like you see container funds or functional programming funds.
- joosters 6y ago
  It’s buzzword-themed, and unfortunately there are lots of funds that are buzzword-themed. Not many of them turn out to be competent or wise investments though. Mostly they are just after mug money.
- barnabee 6y ago
  Because it has been true for every major change since the industrial revolution that the people who saw a new enabling technology trend early and funded/built it won big despite not knowing exactly how it would plays out (and yes, those that arrive too late or get it wrong end up at a dead end lose), so if people get convince something might belong to that category, you’re going to be able to raise a fund around it. You name it: railways, cars, telephone, radio, TV, semiconductors, personal computing, the internet — all of these technologies were created without a complete idea of the change that would happen, and there were always investors ready to get behind the _technology_. Re: containers and functional programming, I guess most people (myself included) see these as tools that streamline existing things but are not going to deliver the kind transformational change that these other technologies do. I realise this is subjective: some people may believe containers are in that category and/or that crypto isn’t, but what matters is only the belief between the people raising the funds and those investing in them.
rayuela 6y ago
Crypto Fund II to pay off investors from Crypto Fund I... genius I tell ya.
zxcmx 6y ago
What if crypto fund II were a token. That'd be putting money where mouth is.
- Sargos 6y ago
  A16Z is from the US. They don't have the freedom to do that.
tphyahoo2 6y ago
https://standardcrypto.wordpress.com/2020/04/30/a16z-struggles-to-earn-passing-grade-in-crypto-fund-ii-learn-by-doing-classroom-project/ https://standardcrypto.wordpress.com/2020/04/30/a16z-struggl... ( A16Z struggles to earn passing grade in crypto fund II “learn by doing” project )
jasondelta 6y ago
Where's the Infrastructure Fund? The Education Fund? I thought a16z was all about "It's Time to Build" now. https://a16z.com/2020/04/18/its-time-to-build/ https://a16z.com/2020/04/18/its-time-to-build/ I guess even they couldn't convince themselves to want to build things. I suppose that hollow rhetoric was for everyone else and not them?
- zarriak 6y ago
  It’s what you write when you see the writing on the wall for the end of a superpower and you get to be right either way while you don’t do anything to fix it.
- godzillabrennus 6y ago
  Even google balked at the cost of infrastructure and abandoned Fiber.
  - MR4D 6y ago
    I think google made a mistake. AT&T (and Verizon too) still has a monopoly on places because of cables that were laid almost a century ago. If someone figures out the next step of search, google could disappear quickly. AT&T, not nearly.
  - three_seagrass 6y ago
    Google Fiber and Fi were focused on getting market incumbents to install fiber and decrease mobile data costs (respectively). They were not targeted at capturing marketshare, but purely tactical, and in that regard successful.
  - adrr 6y ago
    Google is still expanding fiber. They wired a neighborhood near me and theres a vote on my HOA to wire our neighborhood.
- pkaye 6y ago
  The emergency is over. Its time to go back to normal behavior.
quickthrower2 6y ago
Sounds like a 2010 view of crypto when it was all new and exciting! In reality there are a lot of practical problems that I don't think have been solved because they are baked in. I feel they have been mentioned a thousand times on HN. Just to pick on one, using cash which has a volatile value is not practical for the "unbanked". Whereas "IOU" cash based on $US is. Obviously $US is volatile too but a lot less than Bitcoin etc. Stablecoins might solve this, but they are IOUs. And if they are not IOUs then they are untrustable not to crash to zero worth. Crypto makes sense as a speculation, and also as an alternative to cash where you want to avoid government and private interference in transactions (but don't mind potentially losing privacy as all transactions are public). For example Paypal can freeze your account or the Government can freeze your bank account, but "One does not simply confiscate bitcoin".
- fraggle222 6y ago
  What makes the $ more stable?
  - quickthrower2 6y ago
    I am no economist, but probably it's more widespread use pins it down, and addition central banks are supposed to try and keep inflation within a target. Exchange rates fluctuate of course and they can be wild, but within a country currency is usually stable but slowly losing value.
deleted 6y ago
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realtalk_sp 6y ago
I didn't realize until reading the comments in this thread that some people hawking crypto are now using the term 'Web 3.0'? That's utterly repugnant.
lawnchair_larry 6y ago
I’m surprised a16z are still falling for the cryptocurrency meme. It’s been so obvious from the beginning that this will flame out.
- spir 6y ago
  Today, on Ethereum, in one atomic transaction, you can borrow $5m with zero credit or collateral, execute an arbitrage algorithm across N independent financial services, generate a small profit, and repay the $5m. The transaction fails if the predicted profit doesn't materialize, preventing you from losing money, except the transaction fee. The idea that nothing novel or useful is going on in cryptocurrency is intellectually bankrupt. Here are two recent links that I think show some of the cool work going on in Ethereum https://medium.com/molochdao/the-state-of-optimistic-rollup-8ade537a2d0f https://medium.com/molochdao/the-state-of-optimistic-rollup-... https://gitcoin.co/blog/gitcoin-grants-round-5-funding-our-future/ https://gitcoin.co/blog/gitcoin-grants-round-5-funding-our-f...
  - lawnchair_larry 6y ago
    Doesn’t matter if money is moving around in it right now. It doesn’t matter if it’s “interesting”. It’s a fad with no staying power.
RichardHeart 6y ago
Cryptocurrency was invented to remove middlemen. Everyday I hear about another company trying to hold your keys for you. Exchanges are the new banks. DeFi helps get rid of them. Now if only you could buy crypto from your neighbor, we truly could get the efficiencies of fast and nearly free, instant payment. Exchanges benefit from the accidental regulatory capture of security theater making it so you can't sell crypto to others out of fear. Perhaps I'm biased as a cryptocurrency founder.
Traster 6y ago
So is this why there was an article yesterday from A16z pushing a really neutral and balanced guide to crypto explaining how it's going to solve every problem under the sun and is a great tool to decentralize control away from big corporations. Because as you know, venture capitalists are all about creating tiny corporations and giving control back to the customers.
stazz1 6y ago
Are there any promising ideas for content creators other than Steemit?
murftown 6y ago
Off topic, but I really, really wish we could stop overloading the word "crypto" to refer to cryptocurrencies when it already is an abbreviation for cryptography. It's worse when we start saying things like "crypto networks", which is likely frequently misinterpreted/conflated with any kind of secure or encrypted network. We owe it to ourselves to keep clear language available to talk about the concept of secure, private information storage and transmission. Blockchain is cool, but it's a very distinct concept from crypto.

186 points by momentmaker 6y ago

deleted 6y ago

[deleted]

swyx 6y ago

do we know anything about the performance of Crypto Fund I so far? i'm really curious what kind of GP throws good money after bad on out-of-favor stuff like this. not that it can't work, its just unusual. one whole thesis here is "Modern Store of Value". is Crypto Fund II just gonna put 25% in bitcoin? "New Ways for Creators to Monetize". i feel this is the weakest thesis of the lot. i dont see how decentralization helps here. alright im done being crabby hn commenter. good luck to cdixon and katie haun, and the people actually trying to invent the future.

arcticbull 6y ago
> do we know anything about the performance of Crypto Fund I so far? Bad. Very, very bad. > i'm really curious what kind of GP throws good money after bad on out-of-favor stuff like this. not that it can't work, its just unusual. Crypto is at the intersection of ancaps and difficult, probably intractable engineering problems. That intersection is highly idealistic and highly motivated, with an almost religious zeal.
- xiaolingxiao 6y ago
  Could you provide details on how you know it’s bad? I’m not a big “believer” in crypto, but investments can do well on an IRR basis for many years before things go south. See we work in 2017... in crypto, have the companies they investments been marked down?
  - arcticbull 6y ago
    Well, the best performing token is down 8% from ATH (and it launched this morning) and the worst is down 98.59% [1]. All this is leading me to believe they're a poor investment vehicle. [1] https://athcoinindex.com/ https://athcoinindex.com/
    - nemothekid 6y ago
      a16z isn't investing in coins. I don't know if Coinbase was in Crypto Fund I, but it if it was, then I don't think Fund I could have done too bad.
      - arcticbull 6y ago
        Are you sure about that? The Winkelvii sure did. Plenty of funds were set up solely to invest in various coins. Why would a16z be any different?
      - enginar 6y ago
        I think they have invested directly in cryptocurrencies (that is why they decided to register as an RIA), along with a range of other bets that include Coinbase, Compound and Anchorage.
      - mhluongo 6y ago
        It certainly is. They put in quite a bit into Maker and Dfinity, for example.
    - thesausageking 6y ago
      You can't project a16z's performance based on what happened on exchanges. During the ICO boom, they got access to tokens before they ICO'ed, usually at 70-90% discounts. They also make a lot of equity investments into the companies behind the protocol. I have no idea what their numbers look like right now. And it will be hard to judge as most of their investments are illiquid at this point and don't know how they'll work out. Chia, Filecoin, Libra, ... haven't launched so could end up being worth a lot or could be worth 0.
    - fraggle222 6y ago
      Silly to look at % down from ATH when we had a massive bubble that peaked and popped. If you look at return overall, crypto beats ALL stock market investmets.
      - arcticbull 6y ago
  - three_seagrass 6y ago
    The crypto fund or cryptocurrencies in general? Most cryptos (that are not ICO scams) are hammers looking for nail. Outside of some very niche use-cases, most are non-competitive with centralized payment systems. Keep in mind there is a difference between an investment vehicle and a currency, and just about anything is a decent investment if your risk tolerance is high enough. The fervor by which they're pushed by fans is almost religious in that their arguments stem from asking you to ignore certain facts and have faith, usually in the holy whitepaper.
    - dehrmann 6y ago
      > hammers looking for nail Blockchain tech, specifically is this. There are a handful of interesting, viable use cases, but most are solved better in other ways.
    - arcticbull 6y ago
      > ... their arguments stem from asking you to ignore certain facts and have faith, usually in the holy whitepaper. As the scriptures of the great Satoshi Nakamoto [1] foretold, the bankers are coming to steal our net worth through inflation. Therefore, help me move my narcotics proceeds overseas. [1] (Satoshi is likely the international narcotics and arms trafficking, real-life, super-racist Bond-esque villain Paul "Solotshi" Calder Le Roux: https://www.wired.com/story/was-bitcoin-created-by-this-international-drug-dealer-maybe/ https://www.wired.com/story/was-bitcoin-created-by-this-inte...)
- api 6y ago
  > Crypto is at the intersection of ancaps and difficult, probably intractable engineering problems. That intersection is highly idealistic and highly motivated, with an almost religious zeal. There's another reason too: faulty reasoning by superficial historical analogy. There's a crowd of people who think cryptocurrency resembles the early Internet, and that its detractors are wrong in the same was as Paul Krugman was when he thought the net would turn into nothing. The difference of course is that the Internet was immediately useful to an exponentially exploding number of people. I got on the net in 1993-1994 as an early teen and immediately found a ton of fascinating stuff to do with it. I helped less tech-savvy people (including my step sister) get online and they started enjoying chat rooms and the very early web. Nobody uses cryptocurrency except users in a few niches that have remained relatively stable since its inception: people using it as an alternative wire transfer method, black/grey market commerce, and enthusiasts who just think it's cool and go out of their way to use it for the sake of using it. Those niches exist but they aren't growing very fast. Reason from first principles, not by analogy.
  - Jd 6y ago
    Having a forum where people discuss tech trends with an explicit commitment to reasoning from first principles would be very interesting, especially if it had cross over to physics and other sciences.
  - DennisP 6y ago
    If you want to see what corporations are actually starting to use public blockchains for, check out the keynote from the EY blockchain conference last week: https://www.youtube.com/watch?v=-ycu5vGDdZw&t=14m https://www.youtube.com/watch?v=-ycu5vGDdZw&t=14m Essentially, EY expects public blockchains to do for B2B what ERP software did for internal operations. They're building zero-knowledge tech to make that sufficiently private and help with scaling.
    - arcticbull 6y ago
      > Essentially, EY expects public blockchains to do for B2B what ERP software did for internal operations. They're building zero-knowledge tech to make that sufficiently private and help with scaling. Yes, but it's totally and completely unnecessary. If a company doing business with another company doesn't trust either the other company or a mutual jurisdiction to remediate -- they just shouldn't be in business together. No amount of blockchain magic fairy dust is going to change that. Blockchain also only accurately reflects things solely encapsulated within the blockchain. As soon as you're trusting someone to enter data they can enter false data, and now you've got a permanent immutable ledger of hot garbage.
timerol 6y ago
Credit card transactions generally take 2.9% + $0.30, which completely removes the possibility of making money on micropayments. Theoretically crypto should enable lower-fee transactions which could enable micropayments. I say that, but a transaction on the Bitcoin ledger has been more expensive than $0.15 since mid-2016 and fluctuates wildly. Other cryptocurrencies might be able to handle this better. I'm optimistic about Stellar being a useful transaction network, but I don't think the value of 1 XLM is going to move much relative to 1 USD.
- zionic 6y ago
  IF... and I stress IF ETH 2.0's sharded blockchain system works then we'll see a 64x increase (from 64 shards) in throughput on launch with a roadmap to scale to 1000 shards. The gist of it is you have a "multi core blockchain" that is only verified by a randomly chosen subset of validators that then sync their state back up to an oversight chain called the beacon chain.
  - sq_ 6y ago
    I'm not up to date on ETH, but is this the same fabled upgrade that people have been talking about for years now? The concept sounds like it could have real potential.
    - DennisP 6y ago
      Yep that's it. As of now they have a multi-client testnet running a near-final version of the beacon chain, using proof of stake. Assuming all goes well, they'll launch for real later this year. The sharding design is integrated with that but won't actually be implemented until next year. First version of sharding will only store data; execution on shards will be after that. The other thing going on is various layer-two systems called "rollups" which compress on-chain data to a minimum and prove its validity with either fraud proofs or a cryptographic zero-knowledge proof. Some of those are in or near production and can take today's Ethereum to about 2000 tx/sec, for simple transactions like transfers and exchanges. The data-only phase of sharding will multiply that by the number of shards.
tphyahoo2 6y ago
https://lightning.engineering/posts/2020-03-30-lsat/ https://lightning.engineering/posts/2020-03-30-lsat/ finally, a sane solution for micropayments for content. you can see a sort of proof of concept (pre-lsat, but using lightning) on yalls.org and a few other similar toe in the water type sites. but I think if LSAT gets traction it has the potential to turn the content industry upside down. it is still very very early days.
- dylkil 6y ago
  The lightning network whitepaper states a block size of 155mb is required for lightning to work at scale. Bitcoin has a 1mb block size with no hope of it ever increasing. I dont see this as a solution at all.
tempsy 6y ago
I wonder if crypto qualifies as “building” per essay...

chrischen 6y ago

Online payment fees come from fraud, chargebacks, and credit card points/benefits. I don’t see how crypto solves the fraud problem. Sure there will be lower fees, but higher risk of fraud.

crazydoggers 6y ago
It puts fraud mitigation in the hands of the parties involved. Often times this can be done via escrow. There are an enormous number of use cases where escrow works, or even where fraud is of no concern (transfers between trusted parties). For cases where fraud is a concern, third parties can step in and charge appropriate fees. Crypto provides a lot more flexibility in your choice of payment process than credit cards.
- thoraway1010 6y ago
  I've heard some horror stories about escrow. Bad wiring instructions in/out (intercepted emails), bogus escrow companies. Glad to hear these crypto folks have figured it out.
  - worik 6y ago
    Optimist
    - not_really 6y ago
      What does this comment make you?
- jkhdigital 6y ago
  Exactly, payment security is now entirely in the hands of the merchant. Whether this is preferable to existing payment systems is unknown at this point, but it's hard to make a compelling argument either way. Furthermore, credit cards aren't just payment methods--they represent credit extended to consumers by banks. This actually influences the money supply, since (1) consumers can potentially carry unsecured debt balances, and (2) consumers have less need to park money in savings since credit cards provide access to liquidity. In other words, there are a lot more factors in play here than just the transaction fees and fraud mitigation mechanisms.

Fede_V 6y ago

This is so incredibly ironic after the call to build stuff in the real world. As I posted at the time (https://news.ycombinator.com/item?id=22913860 https://news.ycombinator.com/item?id=22913860) - talk is cheap, let's see where they put their money before we compliment them. I guess we've seen it now.

PanosJee 6y ago

Where are the companies from Fund I? Didn't they invested in Telegram. How did that go?

wmf 6y ago
It looks like the Telegram pre-ICO is going to convert into Telegram equity which is what the VCs wanted all along. https://www.coindesk.com/telegram-caves-to-us-regulators-delays-blockchain-launch-offers-to-return-1-2b-to-investors https://www.coindesk.com/telegram-caves-to-us-regulators-del...
Traster 6y ago
Telegram seems to be very successful, they've really picked up some big names using their app. Like Milo, and Jacob Wohl and Sargon of Akkad...

some_furry 6y ago

I'm disappointed to see that none of the Crypto Fund II is slated for Cryptography, but instead only to Cryptocurrency. Obligatory: http://www.cryptoisnotcryptocurrency.com http://www.cryptoisnotcryptocurrency.com There's a lot of important problems in (and around) cryptography that need solving. To be charitable: Maybe some of them can be solved by cryptocurrency projects? There is some precedent here. (Zcash advanced the state of the art for non-interactive zero-knowledge proofs and pairing-based cryptography, Monero demonstrated real-world ring signatures, etc.) But more importantly: There are a lot of possible solutions that need an incentive to be developed, and could potentially become profitable start-ups. But it's sad to see that cryptography (a.k.a. the real "crypto") isn't even a seat at the table calling itself "Crypto".

tptacek 6y ago
The point of a venture fund is not to advance science.
- some_furry 6y ago
  I worded my comment weird originally, hopefully my meaning is clearer now.
  - tptacek 6y ago
    This to me is a little like wondering why distributed consensus doesn't have a seat at the table in other venture funds; there's important work to be done in scaling databases, too! But venture funds fund businesses. If you come up with a business with social proof that there's a plausible (if remote) chance of 10xing based on an advance in cryptography, you'll stand a chance of getting it funded. Just not by this fund, which has nothing to do with cryptography or, for that matter, virtually any normal business.
    - some_furry 6y ago
      > This to me is a little like wondering why distributed consensus doesn't have a seat at the table in other venture funds; It would be a little like that, if the funds were called "Distributed Consensus Fund II" (or some common abbreviation thereof). > Just not by this fund, which has nothing to do with cryptography or, for that matter, virtually any normal business. And thus, in my mind, it should be named appropriately. The current name is wrong.

arcticbull 6y ago

> Unlike existing systems where the sender and receiver must have fee-extracting bank infrastructure in place, payment blockchains require no bank account, thereby opening up financial services to the two billion-plus unbanked worldwide. Unlike existing systems where you have recourse to recover your payments if anything goes wrong, blockchains leave you hanging and at risk of fraud and even simple coding mistakes, thereby opening up financial services to the modern-day robber barons of the world -- and less efficiently than ever. Thus solving payments, once and for all. ONCE AND FOR ALL. Less tongue in cheek, here I was naively hoping we'd gotten over all this. Twelve years of attempts to advance this technology with absolutely no break-out successes, but hundreds of high-profile seemingly obvious failures. Alas, sounds like we're winding up for round 2.

htrp 6y ago
its interesting how crypto ends up rediscovering principles in banking/ traditional finance
- arcticbull 6y ago
  Speed running the history of finance.

deleted 6y ago

[deleted]

htrp 6y ago

iirc they went all in on the exchanges? problem is none of them were able to ride the crypto wave to an ipo

jkhdigital 6y ago

Can we drop the whole "blockchain" shtick and just start calling this space "crypto"? Bitcoin combined a cryptographic protocol with an incentive structure to produce something incredible: digital cash that can be held and transacted without a central authority. The innovation was in the combination of protocol components, not the data structure that resulted ("the blockchain"). The problem that we're actually trying to solve with all of this is how to provide a root of trust. Blockchains are a way to do that, but I've yet to see a compelling use case beyond digital cash. Attempts to implement any transaction more complicated than cash settlement on a blockchain will inevitably run into the fundamental problem: transactions are contracts, and contracts will always require a legal framework and judicial system to mediate. You simply can't remove that requirement and all of the "inefficiency" that comes along with it.

craze3 6y ago
No, because "crypto" is only a subset of "blockchain." Blockchain can be used for a lot more than just digital cash. It can be used for storing immutable logs of any data/content. That implies endless use-cases. Yes, transactions can be viewed as contracts, but the mediation is already accounted for by that specific blockchain's consensus algorithm & proposal/dispute resolution system. Most of the good smart contract blockchains already have systems in place for all this.
- jkhdigital 6y ago
  You've got it backwards, "crypto" is cryptography which is where all of this comes from. "Blockchain" is just a clever combination of ECDSA, Merkle trees and partial hash inversion that has proven useful to implement decentralized digital cash. I think we would be better served by looking at existing real-world problems with fresh eyes to see if cryptography can provide unique solutions, rather than taking one particular protocol template and assuming it can be used for almost anything.
  - tromp 6y ago
    > "crypto" is cryptography It ought to be, and it used to be, but unfortunately it's been hijacked by the cryptocurrency community to such an extent that it's become increasingly ambiguous. > ECDSA or, preferrably, Schnorr signatures. > partial hash inversion There's more to mining than hashing [1]. [1] https://cryptorials.io/beyond-hashcash-proof-work-theres-mining-hashing/ https://cryptorials.io/beyond-hashcash-proof-work-theres-min...

rl3 6y ago

If only there was a way to directly pitch A16z without the connections. Some of us crazy people are consumed by Web3 ideas so much that we spend years thinking about it full-time aren't necessarily the most social or well-connected people. Creating an MVP for a vertically-integrated company that's carefully designed to rip the guts out of the entire existing tech monopoly is extremely difficult at best. Applying with large-scale ideas like this to YC as a solo founder without an overachieving background offers an almost infinitesimal probability of success. Likewise, it'd be cool to see pre-seed funding from these types of initiatives. I'd love to spend another year or two just refining the notes generated by tens of thousands of hours of thought into a cohesive design document. It's so much content I'm having to create a custom spatial interface to map and organize it all into a kind of living design doc. I suppose the point is that the deep thought required to envision things like this is at odds with creating a personal brand or playing the traditional traction-based startup game. Some of us are just out there in left field, alone. We want to bring incredible amounts of value to the table, but it's very difficult to do so.

craze3 6y ago
I would look into getting a head start by leveraging one of the existing blockchain companies that's looking for developers to build on their platform. Usually they are very happy to promote your project(s) on their social media, and/or offer you seed/bridge funding if you can create a compelling MVP. I would also urge you to look for the blockchain companies that are hosting hackathons, since that means they have money to blow on attracting developers. I know all this since I'm in the same boat as you :) Good luck!
- rl3 6y ago
  Blockchain isn't required for an MVP, so I am fortunate in that regard. You know, it's funny to watch Silicon Valley years ago and laugh at the "new internet" part. Then realize shit, I've actually become this person now. :) Appreciate the advice and kind words, best of luck to you as well!
- woah 6y ago
  This is an amusing truth in the industry. The VC's have given much of their money to "layer 1" blockchain projects that are supposed to have lots of application projects building on them. But VC's aren't investing as much in application projects, since there often isn't a clear path to profitability with a decentralized application. A big reason for this is that the layer 1 blockchain will capture most of the value of the applications running on it (for a real life example of this, see Uniswap on Ethereum). At the same time, the success of a layer 1 blockchain is judged by how many applications it has. So maybe one could argue that applications are valued more highly by VCs for enhancing the appearance of success of layer 1 blockchains than for their own sake. This leads to the situation you portray, where it's sometimes easiest for a founder to get investment money from VCs that has first passed through the hands of a layer 1 project.

ve55 6y ago

>Transferring actual value quickly and cheaply without a third party, in much the same way we currently transfer data like emails or photos, Do we actually do this that often, though? Email and photo sharing are generally dependent upon third parties, and generally extremely centralized and powerful ones, such as Google or Facebook or Twitter. Very little Internet communication goes directly from one person to another.

vngzs 6y ago
I think AirDrop works without a third party, but email passes through numerous hops - often in plaintext on the open Internet - before arriving at an inbox. Maybe encrypted messaging like Signal is a better analogy. Yeah, it still passes through a third party, but they can't read it.
- ve55 6y ago
  That's a good example, it's important not to be too pedantic with the definition since everything passes through middleboxes, or at least WiFi/routers or switches. Even so, it seems like the apps that are the most centralized often have the most communication volume, and things like Signal and AirDrop, as nice as they may be, are largely outliers. This is especially the case when we look at group communication, where many participants are involved (Reddit, Twitter, Slack, Discord, etc). I find it very hard to have private group conversations on the Internet due to these platforms, as almost every community is stuck on a completely centralized+proprietary solution by now.
xkjkls 6y ago
And do we not want a third party? Honestly, I like the security of knowing that most of my transactions are reversible within the context of the legal system.
- chrisco255 6y ago
  You don't have to do 100% of your finance on blockchain. I like the freedom of knowing that my funds cannot be controlled by any third party entity, who may object to my spending on the basis of some arbitrary criteria. We've seen people shut out of PayPal for very arbitrary reasons. We've seen the marijuana industry in Colorado shut out of banking (https://www.acams.org/aml-white-paper-marijuana/ https://www.acams.org/aml-white-paper-marijuana/). If centralized entities can control your spending, they can control you. That's one of the core arguments for decentralized finance. As for transaction reversibility, I am sure that a payment insurance program will crop up in the not-too-distant future to alleve those fears.

lalaland1125 6y ago

It seems to me like 99% of the aims in this document could be achieved by a competent and efficient non-profit bank that offers a good API. Let's Encrypt is a similar example of how a cheap and effective competitor can really improve things in a space fraught with inefficiency. Why don't we create a Let's Encrypt for banking rather than fiddle around with frankly unnecessary technology?

creed98 6y ago
Mmh haven't seen too many credit unions do this. Though groceries and netflix are not paid by api but credit card

kauffj 6y ago

If anyone is interested in the intersection of Web 3.0 and Creator Monetization, you might like LBRY. The core idea of LBRY is to make YouTube-like experiences possible without Google (alternatively, to fix the discovery, incentive, and legitimacy problems of BitTorrent). https://lbry.com https://lbry.com (consumer portal) https://lbry.tech https://lbry.tech (tech portal) https://lbry.tv https://lbry.tv (web app) We were also just mentioned on HN in Andy Baio's article on Deep Fakes: https://news.ycombinator.com/item?id=23011445 https://news.ycombinator.com/item?id=23011445

freyrs3 6y ago

You have to appreciate the audacity of some of the portfolio companies in Fund I for getting away hilariously bad business models. They literally fleeced Chris Dixon into funding Pied Piper (dfinity.org) and crypto kittens and he actually bought it. There's definitely some massive sunk cost effect going on with this new fund on a scale we haven't seen before. Anderssen used to be the smart money in VC and now they're doing this fund.

chrisco255 6y ago

The advances happening in Decentralized Finance right now are very important and will power the financial infrastructure of the 21st century. This space is rapidly evolving and is undergoing a Cambrian explosion right now, which is super fascinating to watch. Having been there for the dot com era and the mobile era, this feels the same. If you're in technology, it's worth educating yourself on this space. Two of the best resources I've found are: Bankless Newsletter & Podcast: https://bankless.substack.com/ https://bankless.substack.com/ The Defiant Newsletter: https://thedefiant.substack.com/ https://thedefiant.substack.com/

barnabee 6y ago
Not sure why this is downvoted. It’s clear if you spend time at the right conferences, read the right papers, and talk to the right people that $billions can eventually be saved and risk massively reduced / much better understood and managed, if not by the specific “DeFi” protocols people are using on Ethereum now, then by the things that will come to follow them. The potential upside for the bets that come good is worth a lot of losers — VC is very asymmetrical. Maybe this will all fail but there aren’t many good arguments why. (Yes, you can build all the fraud protection, account recovery, regulatory compliance features that you might need into these systems when the time comes, if that’s what it takes to realise the other benefits — arguments about this are at least 5 years too early.) I remember when building on or investing in Linux was a waste of time because it was a toy and would never be used for anything serious. The truth is, things are still very early — the internet has its roots in the 1960s, we are perhaps where the internet was sometime in the ‘80s with crypto (still an accelerated timeline!). Be very cautious of extrapolating from what can be done now (in crypto, quantum computing, biotech, AI, wherever). Unless you’ve spent months or years researching and piecing things together and know what is actually possible, it’s just possible that there are aspects that you don’t fully appreciate.

jgalt212 6y ago

I've been a crypto bear/skeptic for a long time, but given how much cash the Fed has pumped into the market and their general reluctance to take cash out of the market, we could be set up for some pretty intense inflation if/when there is a U shaped recovery. As such, I'd be looking to buy inflation protection where you can these days: gold, BTC, TIPS, etc.

kryptiskt 6y ago

I wonder why the fund is themed after a technical solution, and not industry or anything else. It's not like you see container funds or functional programming funds.

joosters 6y ago
It’s buzzword-themed, and unfortunately there are lots of funds that are buzzword-themed. Not many of them turn out to be competent or wise investments though. Mostly they are just after mug money.
barnabee 6y ago
Because it has been true for every major change since the industrial revolution that the people who saw a new enabling technology trend early and funded/built it won big despite not knowing exactly how it would plays out (and yes, those that arrive too late or get it wrong end up at a dead end lose), so if people get convince something might belong to that category, you’re going to be able to raise a fund around it. You name it: railways, cars, telephone, radio, TV, semiconductors, personal computing, the internet — all of these technologies were created without a complete idea of the change that would happen, and there were always investors ready to get behind the _technology_. Re: containers and functional programming, I guess most people (myself included) see these as tools that streamline existing things but are not going to deliver the kind transformational change that these other technologies do. I realise this is subjective: some people may believe containers are in that category and/or that crypto isn’t, but what matters is only the belief between the people raising the funds and those investing in them.

rayuela 6y ago

Crypto Fund II to pay off investors from Crypto Fund I... genius I tell ya.

zxcmx 6y ago

What if crypto fund II were a token. That'd be putting money where mouth is.

Sargos 6y ago
A16Z is from the US. They don't have the freedom to do that.

tphyahoo2 6y ago

https://standardcrypto.wordpress.com/2020/04/30/a16z-struggles-to-earn-passing-grade-in-crypto-fund-ii-learn-by-doing-classroom-project/ https://standardcrypto.wordpress.com/2020/04/30/a16z-struggl... ( A16Z struggles to earn passing grade in crypto fund II “learn by doing” project )

jasondelta 6y ago

Where's the Infrastructure Fund? The Education Fund? I thought a16z was all about "It's Time to Build" now. https://a16z.com/2020/04/18/its-time-to-build/ https://a16z.com/2020/04/18/its-time-to-build/ I guess even they couldn't convince themselves to want to build things. I suppose that hollow rhetoric was for everyone else and not them?

zarriak 6y ago
It’s what you write when you see the writing on the wall for the end of a superpower and you get to be right either way while you don’t do anything to fix it.
godzillabrennus 6y ago
Even google balked at the cost of infrastructure and abandoned Fiber.
- MR4D 6y ago
  I think google made a mistake. AT&T (and Verizon too) still has a monopoly on places because of cables that were laid almost a century ago. If someone figures out the next step of search, google could disappear quickly. AT&T, not nearly.
- three_seagrass 6y ago
  Google Fiber and Fi were focused on getting market incumbents to install fiber and decrease mobile data costs (respectively). They were not targeted at capturing marketshare, but purely tactical, and in that regard successful.
- adrr 6y ago
  Google is still expanding fiber. They wired a neighborhood near me and theres a vote on my HOA to wire our neighborhood.
pkaye 6y ago
The emergency is over. Its time to go back to normal behavior.

quickthrower2 6y ago

Sounds like a 2010 view of crypto when it was all new and exciting! In reality there are a lot of practical problems that I don't think have been solved because they are baked in. I feel they have been mentioned a thousand times on HN. Just to pick on one, using cash which has a volatile value is not practical for the "unbanked". Whereas "IOU" cash based on $US is. Obviously $US is volatile too but a lot less than Bitcoin etc. Stablecoins might solve this, but they are IOUs. And if they are not IOUs then they are untrustable not to crash to zero worth. Crypto makes sense as a speculation, and also as an alternative to cash where you want to avoid government and private interference in transactions (but don't mind potentially losing privacy as all transactions are public). For example Paypal can freeze your account or the Government can freeze your bank account, but "One does not simply confiscate bitcoin".

fraggle222 6y ago
What makes the $ more stable?
- quickthrower2 6y ago
  I am no economist, but probably it's more widespread use pins it down, and addition central banks are supposed to try and keep inflation within a target. Exchange rates fluctuate of course and they can be wild, but within a country currency is usually stable but slowly losing value.

deleted 6y ago

[deleted]

realtalk_sp 6y ago

I didn't realize until reading the comments in this thread that some people hawking crypto are now using the term 'Web 3.0'? That's utterly repugnant.

lawnchair_larry 6y ago

I’m surprised a16z are still falling for the cryptocurrency meme. It’s been so obvious from the beginning that this will flame out.

spir 6y ago
Today, on Ethereum, in one atomic transaction, you can borrow $5m with zero credit or collateral, execute an arbitrage algorithm across N independent financial services, generate a small profit, and repay the $5m. The transaction fails if the predicted profit doesn't materialize, preventing you from losing money, except the transaction fee. The idea that nothing novel or useful is going on in cryptocurrency is intellectually bankrupt. Here are two recent links that I think show some of the cool work going on in Ethereum https://medium.com/molochdao/the-state-of-optimistic-rollup-8ade537a2d0f https://medium.com/molochdao/the-state-of-optimistic-rollup-... https://gitcoin.co/blog/gitcoin-grants-round-5-funding-our-future/ https://gitcoin.co/blog/gitcoin-grants-round-5-funding-our-f...
- lawnchair_larry 6y ago
  Doesn’t matter if money is moving around in it right now. It doesn’t matter if it’s “interesting”. It’s a fad with no staying power.

RichardHeart 6y ago

Cryptocurrency was invented to remove middlemen. Everyday I hear about another company trying to hold your keys for you. Exchanges are the new banks. DeFi helps get rid of them. Now if only you could buy crypto from your neighbor, we truly could get the efficiencies of fast and nearly free, instant payment. Exchanges benefit from the accidental regulatory capture of security theater making it so you can't sell crypto to others out of fear. Perhaps I'm biased as a cryptocurrency founder.

Traster 6y ago

So is this why there was an article yesterday from A16z pushing a really neutral and balanced guide to crypto explaining how it's going to solve every problem under the sun and is a great tool to decentralize control away from big corporations. Because as you know, venture capitalists are all about creating tiny corporations and giving control back to the customers.

stazz1 6y ago

Are there any promising ideas for content creators other than Steemit?

murftown 6y ago

Off topic, but I really, really wish we could stop overloading the word "crypto" to refer to cryptocurrencies when it already is an abbreviation for cryptography. It's worse when we start saying things like "crypto networks", which is likely frequently misinterpreted/conflated with any kind of secure or encrypted network. We owe it to ourselves to keep clear language available to talk about the concept of secure, private information storage and transmission. Blockchain is cool, but it's a very distinct concept from crypto.