95 Crypto Theses for 2018

17 min readJan 2, 2018


(I see your top 10 and raise you 85.)

Happy new year, everyone!

The post-Christmas, pre-New Year’s period is always one of my favorites. Every year, I take a couple of days to unplug from the internet, reflect on the past year, and look forward to the year ahead. What I’m excited about, what I’m fearful of, what I need to do to evolve, who I need to get back in touch with, how can I relentlessly prune bullshit, which of my core beliefs have changed, and which high-conviction contrarian beliefs do I still hold.

The process helps me declutter my mind, refine my plans for world domination, and get excited about how amazing, happy, and successful future me is going to be. (Even if New Year’s Day me wakes up hungover and feeling like a beached whale.)

I wanted to share some of my thoughts from this year’s exercise, since so many of them had to do with crypto. Some of these might be helpful to you, others might offend you, still others might seem stupid, simple, or obvious. But I offer them up because writing for such a great, long-term audience sharpens my mind, and weeds out half-baked thoughts.



95 Theses for 2018

On Crypto Prices and “Investing”

1) 2017–2019 will be THE big crypto bubble. Things could get nuttier from here…far nuttier than in the dotcom era. The retail investor base is 10x larger, with 24/7 access to the FOMO and get rich quickism. And we’ve got CNBC to help with the pump!

1a) Unbelievably, the institutions will be the last money in this time, with the futures market and custody solutions just coming online, and the mythical ETFs perhaps not too far behind. This has been properly hyped, I think. I could see a Q1-Q2 stampede.

2) OTOH, there are only like five people talking about “fundamentals” right now. Most seem to be triangulating on the same general view. I call it the cryptoasset barbell: cryptocurrencies (sky’s the limit), utility tokens (heading to zero), and “smart securities” (coming soon).

3) BTC, ETH, ZEC, and XMR are the main cryptocurrencies. These could still have a LOT of room to run. Money is a reflexive asset where the more people buy it and use it and believe in it, the more valuable it gets. Cryptocurrencies are the ultimate momentum play.

4) Utility token valuations should theoretically be capped at the future maximum utility value of the network divided by velocity. Low velocity comes from a need to hold: you hold money (reserve savings) and securities (income producing) and very few staking tokens.

5) Most utility tokens, then, will go to zero, regardless of team quality and execution. You simply don’t need to hold them but for momentum & greater fool investing. When the market lacks “higher order” investors for speculators to flip to, assets will unwind. Viciously.

6) Desperate utility token teams will later try to concoct velocity “sinks” to ward off unravelings. The most common sinks we’ve seen have been to create incentives to “stake” coins: most commonly protocol governance rights and network fee dividends.

6a) Kyle Samani from Multi-coin wrote a great piece about some of these attempts. Most will fail, but some might have limited success.

7) Crypto-securities aren’t really a thing yet, but they will be massive, and they will actually have measurable fundamental value due to their cash flows or the residual claims they give their holders. Most surviving utility tokens will at least try to convert to crypto-securities.

8) Bidding up assets you don’t believe in is tulip bubble speculation / greater fool investing / pump and dump BS. That or investors are just impossibly optimistic about how valuable a fledgling network’s future cash flows could be. Nah, just kidding. It’s scammy. Don’t @ me.

8a) Related reading: 1) Burniske, 2) Winton, 3) Pfeffer.

9) I didn’t understand XRP at $1bn. I really don’t understand XRP at $100bn. It’s not required to use Ripple’s software, so unless banks are adopting the currency as a new global reserve, it doesn’t make sense. But the top employees are now billionaires, so that’s cool.

10) BCH is tough to root for, but you have to be long as a hedge. If BCH loses badly, I doubt we’ll ever see on-chain BTC scaling, and Core’s stranglehold on the dev roadmap will be cemented. But if BCH wins, it could take down the whole asset class. Rock. Hard place.

11) Cardano, NEM, and IOTA at $10bn market caps make me want to commit seppuku. Seriously, what the f*ck is wrong with people.

12) BTC = reserve currency for people that hate the fed; ETH = reserve currency for people that hate the SEC; XMR = reserve currency for people that hate big brother; Dogecoin = reserve currency for people who don’t care about money.

13) Most mature cryptos trade in pairs or as a group. BTC/BCH, ETH/ETC, XMR/DASH/ZEC. If you’re going to trade, you should think about how these things trade vs. their baskets. LTC doesn’t trade higher than 0.02 BTC. ETC follows ETH up and down. Et cetera.

14) The time to make money in ICOs was in 2015 and 2016 when they were contrarian. Almost everything else more recently was either a) restricted to insiders, or b) underperformed vs. BTC/ETH. (If you can’t spot the sucker at the table, you’re the sucker.)

15) Good token sale teams are starting to demand that their pre-sale investors submit to lock-ups and vesting schedules. That’s admirable, but when you destroy your own liquidity premium, you will probably need to slash your valuation expectations.

16) Tezos was a cool project that embedded governance at the protocol layer. But it will probably be remembered as the project that made people start to think twice about “clever” overseas legal structures and hand-wavy “these are actually donations” mistruths.

17) Forks with airdrops will become the preferred alternative to ICOs. You give away free money in order to get people excited about the new and improved project. The only thing they pay is attention. The people who truly buy in become your collaborators.

18) Stablecoins will work until they don’t. Sure, the Basecoin and MakerDAO teams seem strong, but these things will always break under (not so) black swan market conditions. And like the fiat currencies they aim to replace, once they break, they’ll be broken for good.

19) Token sales for decentralized derivatives protocols. Tokens to short tokens! What could go wrong?

20) There is no rhyme or reason to prices in crypto, and there will not be in 2018. Best to embrace that this will be a sentiment-driven market until the crash. Stay safe and embrace the opportunity to sit on the sidelines and do research! There will be gems to swoop up in the coming 99% off sale.

People and Personalities

21) I respect Vitalik more every day. He says all of the right things and strikes me as a once-in-a-generation type of visionary leader for the ethereum community. That said, whether he ends up like Steve Jobs or Elizabeth Holmes depends on some pretty ambitious technical breakthroughs. Crypto is so polarizing that I don’t know what to believe re their potential.

22) There is only one Andreas, and we’re lucky to have him. There’s no more deserving person in crypto to earn a windfall gain than Andreas Antonopoulos. He’s been patient zero for many in the industry, and his positivity and authenticity are an example for all. The $1.5 million (and counting) in donations he received made for the feel-good story of the year.

23) Yes, Craig Wright could be (part of) Satoshi. Satoshi was a jerk in emails. CSW is a jerk in real life. Satoshi had a fat early stash. CSW seems to have been early to BTC (no matter your opinions of him). CSW convinced Gavin and some other smart and early bitcoiners he was the same person. Finally — and this is the clincher for me — if you were Satoshi, you’d probably be paranoid to the point of believing that no matter the extremes you went to remain hidden, at a large enough $ value of bitcoin holdings, powerful people would eventually dox you. What better way to hide in plain sight than to get an army of smart bitcoiners discrediting you and mocking you as a con artist. That’s how a genius would have played things.

24) Read everything Chris Burniske writes. He’s taking “intellectual compounding” to a whole new level. Started with some basic foundational theories and build on top of them. He’s become the go-to analyst, and CryptoAssets is a must read / must gift to newbs.

25) So many good crypto podcasts right now. I’m thinking of doing one because it’s probably easier than writing. (But that’s why I ultimately won’t do one.) Laura Shin’s Unchained is the most professional, Marty Bent offers a bro-y alternative by working with the Barstool Sports guys, Brian Crain’s Epicenter podcast is great. And I like Arthur Falls’ The Third Web, mostly because of his Aussie accent.

26) The best crypto twitter follows right now are: Tuur Demeester and Ari Paul (trading insights), Jameson Lopp (bitcoin basics and maximalism), Andreas (nails the why), and Neeraj (policy & memes). FortuneLedger actually put together a great list that I mostly agree with.

27) And then there’s Naval, the most underrated, overrated person on twitter. I’m a contrarian, so I feel a little dirty saying this, but I gobble up most of his recommendations, including his epic reading lists. Sapiens and Sovereign Individual especially are must reads for anyone in crypto. The Farnam Street podcast was also worth the hype.

28) Follow me! I crave attention. And also I want an excuse to write every day in 2018 like I did in 2014–2015. (I will fail, but I will try!) My goal is to read 200 white papers and 10-k’s this year and synthesize most of that info into good synopses in order to help fill the educational void in the crypto market. Collaborators are welcome to stress test ideas.

29) I can say this now without feeling like a kiss-ass because I just left ConsenSys officially: Joe Lubin is one of the most interesting people in the industry. One of the dudes that wrote the checks which funded the early Ethereum experiment. Came up with the idea for ETH’s gas system. Running the biggest crypto company (by headcount) in the world and is revered by the team there. He’s almost certainly one of the wealthiest people in the industry, yet still the first one in / last one out. He is the hardest working person in the entire industry.

30) The CoinDesk top 10 influential list this year was A+. I’m just filling in the gaps above with some miscellaneous thoughts, but you should read/watch their full profiles. It was well done.

Tax & Estate Planning

31) Everyone in crypto should open their own donor-advised fund. As long as you’ve held for one year or longer, you can gift property and write off the fair market value of your investments + avoid taxes on the gains of those assets.

32) Most crypto trading during the run up is a sucker’s game. You’re trading against BTC as a reserve, but every trade causes a taxable event in fiat. In a parabolic up-market, trading nets you big, ordinary tax liabilities, clipping your overall crypto exposure.

33) Now that the Coinbase precedent has been set with the IRS, expect Polo, Bittrex, and all other major exchanges with US customers to fork over trading records for clients above a certain trading threshold. I’ll take crypto tax evasion for $1,000, Alex.

34) Doing specific ID analysis for crypto trading is tough enough when it’s just bitcoin. Add dozens of other pairs, and the accounting gets messy. Better to pay an accountant if you’ve eclipsed six figures in trading gains. Save time and money and years of freedom.

35) Expect more people to renounce their citizenship in high tax countries, and more people to move their legal residences to lower tax states. This is going to be a multi-billion dollar game of IRS cat and mouse that plays out over years. I know some people who are essentially buying “free houses” — legal residences that they hope will save them millions in state capital gains taxes by creating a nexus in a lower income state.

On the Nouveau Riche

36) Most of this money hasn’t really been “earned” yet, as Vitalik points out. That will damage the psyche of many in the new crop of millionaires that did little but click “buy” at the right time, and now find themselves wealthy, but woefully under-qualified for most employment. It won’t happen overnight, but many of the “winners” will end up deeply dissatisfied. (I can see you wiping your fake tears.)

37) But seriously, there will be some of E! True Hollywood Crypto Story type of shit coming out in the not-too-distant future. The bad thing about life-changing amounts of money is it’s often a curse. 70% of lottery winners end up broke within years. But after $75k in household income, your happiness doesn’t change.

38) The nice thing about life-changing amounts of money is that it frees people up to work on their passion projects without fear. Those who grinded on passion projects for years, probably haven’t changed their daily routines, but the pressure’s now off, so they don’t have the cognitive overhang of money worries. (Corollary: Look to work with people who aren’t distracted by daily crypto trading, unless of course you want to spin the roulette wheel and join a new fund.)

39) We’ll see more “bitshaming” next year. Real-world friends and crypto peeps alike can overestimate your net worth by a factor of 10, I think. If you start from a small base, don’t get employee equity, or aren’t an expert (lucky?) trader, even an OGs might not be filthy rich (yet). I should start playing Sarah McLachlan music next to my avatar and bitcoin addresses.

40) Thank goodness for the “bitshamed”! They are the ones who still have incentives to do the work. The mix of rapid liquidity, loaded token project balance sheets, and parabolic upward moves is going to create some fat and happy also-rans that can be outflanked by the hungrier and more competent.

WTF??? (Schadenfreude & Darker Thoughts)

41) As Warren Buffett says: “It is not greed that drives the world, but envy.” It’s ok to celebrate when the 23 year old ass hole day trader who pumped and dumped his way to riches and bought a lambo gets rekt and margin called to oblivion in a flash crash. Sorry.

41a) But it’s much better to use envy and anger as a motivating factor to stay heads down and build something with long-term value. Get rich slow, and be happier building something with staying power.

42) I guarantee you that after Andreas’ windfall donations, anyone who has grinded away on a blog or volunteered on crypto projects for little or no income was screaming at their computers: WHY DIDN’T ROGER BITSHAME ME?!? The content game doesn’t pay. Directly at least. Unless you’re Andreas. Lucky bastard.

43) There is a special place in hell for people who backstab their teams and don’t spread the wealth in a 100x vertical market. I might break my hands from clapping so hard when certain people watch their top talent turn over this year. F*ck them. In this market, 99% hard work, and 1% schadenfreude can help preserve your sanity.

44) As a rule of thumb, I find that the people that smile the widest will screw you the hardest. Write them off, no matter how important you think they are (or how important they think they are). There are lots of scammers in crypto. But there are also many more great people who could become your multi-decade collaborators (or enemies).

45) For the super wealthy, “be your own bank” only works if you are a relative unknown in the industry. I fear we’ll see numerous kidnapping and blackmail cases where top personalities are extorted successfully. Expect to see more personal security details in 2018. This should scare the shit out of people.

46) Insider trading is something that should be punished and will be. Trading on information when you know a new token is about to get listed on Polo or Bittrex or Coinbase breaks the spirit of a lot of securities and commodities laws. And given the sky-high liquidity premiums for cryptoassets, this is one of the industry’s biggest black marks. I hope the most egregious offenders get caught and go to jail.

47) The Charlie Lee LTC sale was one of my least favorite things that happened all year because he’s one of the industry’s good guys. (I should note that he was also one of my most generous supporters back when I blogged for tips in 2013–2014.) BUT it’s not heroic for you to eliminate “conflicts of interest” by selling your stake after a 100x run-up that was almost certainly fueled by your own vocal advocacy, including on CNBC. Keep skin in the game, man. Enjoy the upside! Or go down with the ship.

48) Dogecoin Dark (Verge) was literally up over one million percent in 2017. It’s ok for you to not be ok with that. Especially since it now it looks like it doesn’t even work as promised. Shocker.

49) VC’s that push for portfolio company token sales as mechanisms to pay themselves back when they know the companies are sucking wind or the tokens are completely unnecessary are being dishonest — full stop. Professional investors getting liquidity from retail audiences in lieu of an IPO. Don’t @ me. It’s bullshit, and you know it.

50) We’re only a couple of years away from a fledgling and well-functioning assassination market taking shape. The initial targets could be investigative journalists who pursue shady crypto characters. That’s why I’ll never do a Gox-like story again even if I have the opportunity. It doesn’t pay. It’s too distracting. And soon it will be downright dangerous. Perhaps I think too highly of myself (spoiler alert), but I have to imagine I’m already on some kill lists. I would take great pride in a foiled assassination attempt. But a successful one wouldn’t be as fun, because, you know, I’d be dead.

The ICO and Crypto Fund Craze

51) The precious investor resource in crypto right now isn’t money, it’s attention. Everyone has the ability to “invest” in flips right now, so true equity rounds with less liquidity need to be priced appropriately. Treat a fundraise like an extension of your recruiting efforts, and get good people in at fair prices!

52) Most crypto funds will (net of fees) underperform vs. BTC and ETH as benchmarks (as they have for the past six months). I said this back in August, and it’s even more true today with bitcoin dominance nearing historic lows of 36%. (36%!!!)

53) TBD on whether those hedge funds will even outperform the S&P long-term. Many might not. I can see some of these new fund managers trying to catch falling knives once the bottom falls out in the token market, and getting completely destroyed.

54) Sooner rather than later, the institutions will wise up to the reality that they shouldn’t be paying carry on funds mostly denominated in BTC and ETH. When that happens, you’ll see a massive influx of capital to passive index funds like Bitwise’s HOLD 10.

55) The new funds I’m most excited about are Libertus Capital (Pamir Gelenbe), 1confirmation (Nick Tomaino), Placeholder VC (Chris Burniske / Joel Monegro), and BlockTower (Ari Paul). No, I’m not invested in any of them, but I like their approaches.


56) I’m excited for the future of “smart securities.” Adding smart contract functionality to asset classes such as real estate, energy, insurance, and even more exotic areas like human capital contracts will be fascinating to study. Issuing a token under Reg A+ as a security will be one of the big areas of investment in 2018 and beyond.

57) Self-regulation can and will work in this industry. You just need the right combination of social pressure, common sense, and economic leverage. It’s a cat herding exercise more than anything. (Check out messari.io to learn how you can help.)

58) For the love of god, we need better crypto tax solutions. It’s mind-blowingly complex to do all this reporting. Even if you aren’t hedged across multiple exchanges, wallets, and vaults (personal and third party), it’s a nightmare to track cost basis. But as you start moving money between personal bitcoin/ ether wallets on and off-exchanges, you have to explain why you aren’t triggering taxable events. And what constitutes a like kind transaction. This is the first year that I’ve been totally ok with paying someone else to do my taxes.

59) Our medical system in the US and its lack of true reform is one of the most disgraceful parts of living here. If you’ve spent any time in healthcare services, you know it’s a payments, privacy and data problem. Things that are part and parcel to crypto/blockchain. I hope we see new ideas in 2018. Forget a parallel financial system. It would be a win if we could get to a parallel healthcare financial system.

60) I’m rooting for Spankchain. One of the few applications I could see driving real adoption for crypto-payments. They also have the best legal defense in the industry against being labeled a security under Howey. “Your honor, of course the plaintiff claims he thought he was buying a security. No one wants to tell his wife he spent $25k on cam girls last year.”

61) We shouldn’t be surprised that ICOs, CryptoKitties and Spankchain will likely be the early application winners. Gambling, nerd games and porn are always at the bleeding edge of new technologies. (This is entirely predictable, but the scale of the mania was not.)

62) With crypto as a broad asset class up nearly 40x in 2017, more employees than ever have latitude to move on to passion projects without financial fear. Glass half empty me says that this will lead to “too many chiefs and not enough indians” to do the actual work. Glass half full me says we’re about to see more “sovereign individuals” who blur the line between employees and contractors. I thought the ConsenSys “mesh” model was insane when I first met Joe at the Brooklyn offices in 2015. Now I think it could end up becoming the norm.


63) I greatly enjoyed reading Charlie Munger’s mental models regarding “human misjudgment” over the break. Long, but worthwhile read and highly relevant to ensure you keep your head in crypto. Full read.

64) Cliff notes: i) Incentives are everything in management. ii) Incentives are everything in management. iii) Incentives are everything in management.

65) iv) We’re both social and tribal which effects our biases. Our friends can’t be scammers, they are our friends! Other foreign groups are scammers with pre-mines and Bitfinex pumps, they should go to jail.

66) v) We hate uncertainty, which is why we cling to things that are familiar when stressed and confused. That’s why we stay in jobs that we hate and buy shit we don’t need (to paraphrase Tyler Durden). If you minimize your daily cognitive load, you can better deal with uncertainty.

67) The reciprocation tendency is big: people like to say yes, and feel guilty after saying no, so start with an irrationally big ask. When you come back with something less insane, your hit rate will be higher. We can all learn from Donald Trump. (That hurts to write.)

68) “Always tell us the bad news promptly, it is the good news that can wait.” If you work for someone who shoots messengers or holds grudges, quit immediately. Skeptics and constructive critics are needed in this industry, where too many are high on moon fumes.

69) We all have an excessive self-regard tendency. That endowment effect is insanely strong in crypto. (Bull-market geniuses!) I’m guilty of it too apparently, for not stopping at a mere top 10 list. Surely my 95 theses to start the year will be the greatest thing you read today.

70) “Then again, don’t underestimate the man who overestimates himself.” i.e. fake it til you make it, crypto kidz.

71) And my personal favorite: pride isn’t inherently bad. Many forms of it are harmful, but *justified pride* — in a job well done, or in developing a reputation for being trustworthy for instance — is a very healthy form of pride.


72–94) Either I ran out of time or interest, or I’m legally not allowed to share my final 23 nuggets of word vomit. Hope you got your fill, anyway. I’ll be back here soon, and always on twitter.]

95) If you like this post, and/or if this blog and my twitter banter have helped you make money in the past, and you’d like to send a crypto tip/gift, you can do so at one of these addresses:

BTC: 1LfS46SjSs8qxpjAPyRYQoTFQVojNb2wfS

ETH: 0xA70B84722cD9C699322cBF451a6DbdEc3F85da57

While 2017 was a phenomenal year for most of us, I haven’t really cashed in on the token craze, and I’m not a multi-gazillionaire (yet), so yes, your contributions are still appreciated, so I can pay the $25k / month bill for COBRA as I start up my new venture, and build up some dry powder to pay my ransom when I’m kidnapped.

Please don’t kidnap me, though. I’m busy.




Messari Founder. Crypto since it was “bitcoin 2.0” Formerly ConsenSys, DCG, and CoinDesk. Sign up for my Unqualified Opinions: https://messari.substack.com/