Multicoin Capital: a thesis deduction madman who disrupted Ethereum’s crypto party with a hundred times the return of the king

In the spring of 2017, after experiencing the ICO bubble, Kyle and Tushar, the two founders of Multicoin Capital, recognized the current situation of the lack of analytical framework for crypto investment, and decided to be the Benjamin Graham of the crypto world, trying to open up the field of value investment in the crypto field. era.

Starting from “Understanding the Circulation Velocity of Tokens”, the two have established a fund personality that is not afraid of “anti-consensus” with a sharp article. When people enthusiastically sang Ethereum, they bet heavily on EOS, the “Ethereum Killer”; EOS failed due to the project itself. When the market celebrated Multicoin’s “mistakes”, Multicoin did not “admit mistakes” and insisted on its own thesis. Betting against the speed of Ethereum’s expansion, and finally cast a brilliant project like Solana.

In the past 5 years, Multicoin’s investment style has always been driven by thesis: a group of enthusiastic observers of the encrypted world, day and night debate on the problems of the public chain, deduction of technological iterations and the “theoretical picture” of the future of the encrypted world, and build investment portfolios accordingly .

Multicoin believes that a thesis will focus its firepower to invest. They “take a 10-year horizon and wait patiently for the thesis to be verified by time . They are more afraid of missing an opportunity for infinite compound growth than entering the market too early .” They work closely with the invested projects and have contributed to the construction of the Solana ecosystem, as well as Helium, The Graph and many other projects that have caused people to rethink the Web 3 model.

As of the third quarter of last year, the data shows that the Gross MOIC of the first phase of Multicoin’s VC fund is as high as 114.7 times, and the DPI is 47 times. A report by Axios late last year also showed that Multicoin’s hedge fund returns were around 203 times since its inception.

Multicoin’s LP lineup includes Marc Andreessen (a16z) , Sam Bankman-Fried (FTX) , Fred Wilson (USV), Su Zhu (Three Arrows), all names that need no introduction.

Multicoin’s culture is hot and direct, and the two founders dared to express unpopular opinions in public, especially in the tribal and intolerant discussion environment of crypto , even if they were later proven right. There are many resentful haters. But this does not affect the people who love them extremely fond of them. This outsider who initially broke into crypto as an Ethereum spoiler has become the king of the crypto party by jumping and jumping.

The following is the content of this article, and it is recommended to read it in combination with the main points.

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01 Escape from Wall Street: Finding a New World

02 A watcher of the crypto world who builds a reputation with every stroke

03 Winners win big, losers average losers

04 Thesis-driven deduction madman

05 “The third entrepreneurial partner”

06 Investment Themes and Crypto Future

  • Open finance: the grand ideal of financial integration
  • Web3: Reimagining how human economic activity is coordinated
  • Almighty public chain: a future without bridges
  • Non-sovereign currencies: beyond the trust-based economy

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

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01.

Escape from Wall Street: Finding a New World

The two founders of Multicoin are both New York University undergraduates in the class of 2008. Both of them once hoped to leave their mark on Wall Street. Until the financial crisis happened, the loss and prosperity of Wall Street and Silicon Valley directly affected their trajectory. Kyle began to study entrepreneurship with his computer scientist father at VersaSuite, an electronic medical records company. Tushar also wanted to learn entrepreneurship. He rejected offers from several large PB banks and volunteered to cut most of his salary to work in Kyle’s father’s company.

A year later, the two went out on their own. Kyle made a VR display device for surgeons based on Google Glass, which can be worn on the head during surgery to record the entire interaction process with the patient, and see some successful surgical guidance in the past. Soon Google killed the then-famous app, and Kyle was forced to sell his first startup. In terms of market opportunities, he was at least 10 years earlier.

Tushar’s first attempt was also in the healthcare field, establishing ePatientFinder, a platform that matches doctor-patient data and clinical trials. At that time, people’s acceptance of SaaS was not as good as it is today. The entire sales chain, feedback from clinical trials, and product cycles were too long. Tushar eventually sold it to a competitor.

The first four years after the two graduates are not considered successful in the worldly sense, and even many people will think that it is too slow. Satoshi Nakamoto’s Bitcoin white paper, which was published in 2008, was not picked up by Tushar until 2013. Then Kyle “discovered” Ethereum, and the two completely entered the crypto world. They participated in many offline discussions of cryptocurrencies within a year, and met a future Multicoin LP Adam Mastrelli.

It wasn’t until the spring of 2017 that they decided to start a crypto fund together. Since then, everything has been given an incredible acceleration, with an unmatched rate of return in 5 years.

Helium and Solana , which are heavily owned by Multicoin , represent their two major beliefs: the power of Web3 to decentralize organizations in the physical world, and the future of an omnipotent public chain . When the third fund was raised in the second half of last year, Multicoin allocated about 11% of the two VC funds in Helium and 7% in Solana, both of which have achieved more than 10 times the return. Solana’s MOIC has reached an astonishing 1318 times.

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

As of the third quarter of 2021, an LP shared the returns of their first VC fund in Multicoin, with a Gross MOIC of 114.7x and a DPI of 47x. The official caliber of Multicoin shows that the first and second VC funds have achieved returns of 33.1x and 3.6x respectively.

Founder Kyle often mentions ‘Timing is a bitch’ in interviews, and believes that it is impossible to invest in the crypto field with a good time, so he has to get out of his obsession with timing, “Winning after ten years “.

Multicoin’s first VC fund was only $17 million. After achieving impressive results, the second and third funds were still very restrained and only raised $100 million and $250 million. Today, with a hedge fund of about $4.5 billion in AUM, Multicoin is still focusing on finding the top 1% of entrepreneurs with a team of more than a dozen people . If you look closely at images of them speaking in public, you may find that they answer tough questions about the future of crypto with a little air and a distant gaze, as if that’s where all the great things happen.

02.

A watcher of the crypto world who builds a reputation with every stroke

2017 is regarded by many as the first year of the crypto field. At that time, the ICO bubble was short-lived. Tushar said that even the absurd concept of Dentacoin can gain a group of believers in the market. Dentacoin is determined to give people with high oral hygiene. Disrupting the dentistry industry by offering token rewards has also sparked a wave of public opinion that these tokens can be used as fiat “general equivalents” to buy goods.

The phenomenon of short-term rapid rush and rapid listing deprives long-term investment of living space. At that time, very few institutional investors paid attention to the encryption field, and the capital movements were very hidden.Polychain and MetaStable, which were relatively influential at the time, never shared any market insights in public, let alone advocated a more rational value investment.

The crypto world in 2017 needs a Benjamin Graham . Kyle and Tushar found a vacuum and began to speak.

Neither has a pretty crypto-related resume, and the biggest weapon for getting attention and building a brand is writing.At the beginning of its establishment, Kyle’s article “Understanding the Circulation Velocity of Tokens” was wildly forwarded in the crypto circle. To this day, Multicoin is one of the most vocal investment teams in the crypto world.

For example, one of the most-written concepts of Multicoin recently: composability, which refers to the continuous building of new modules on a platform and programming them into higher-order applications. Multicoin believes the time is ripe to build a “crypto Lego” where users can combine the underlying protocol in different ways. While demonstrating composability, Kyle also repeatedly demonstrated why the answer to public chain expansion cannot be “sharding” .

Taking Defi as an example, based on the same “Lego base” (underlying order book), the decentralized spot trading Serum and the futures exchange Mango Markets can simultaneously long spot and short contracts based on an “incremental neutral” strategy. The fully collateralized method creates a stable currency UXD; the high-performance all-round public chain can also superimpose the agreement integration of lending protocols, digital asset custody, options trading and even hedging tools, which cannot happen in the state of multi-chain fragmentation : The delay of information loading between systems, the technical complexity and coordination costs of development, and the fragility of cross-chain applications will all disrupt the operation of this Lego world.

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

The two founders are keen to share how they see possible applications and technology paths in the crypto world like this, and often announce an investment in articles that draw on previous assertions, such as social experiments with timestamps. Tushar mentioned in an interview with Capital Allocators:

We are used to putting our opinions on paper and posting them online, because the crypto world, especially those on Twitter, like to poke at your loopholes, and you are forced to debate and revise and verify your position.

At first, the fundraising of Multicoin was not smooth, and many institutional investors were still skeptical of crypto. Some managers of large LPs were unwilling to take risks, and preferred to invest in Sequoia, or even Paradigm, a fund with established social relations. But as Kyle and Tushar’s writing became more and more prosperous and their voices gradually increased, many investors noticed them.

Throughout 2018, Multicoin has won a number of heavyweight LPs: Marc Andreessen, Chris Dixon and David Sacks (the first two are the soul of a16z, David is the founding COO of Paypal and the founder of Craft Ventures), and Fred Wilson of Union Square Ventures He even bluntly stated that the reason why he raised the bet was that the two founders were ” not afraid of making mistakes in public “.

Of course, this bluntness of Multicoin also attracted a lot of firepower. They were initially staunchly bearish on Ethereum, and as a result they invested in EOS, the infamous “Ethereum Killer”, a blockchain trying to provide a high-speed alternative. In the eyes of many Ethereum fans, this is a direct challenge to Ethereum.

Multicoin is not afraid to bombard projects they think are overvalued (such as Ripple) in public, and express their views on projects with a large community base such as Ethereum and Litecoin. This kind of anti-consensus critical thinking and the courage to speak up have become A clear banner for Multicoin.

03.

Winners win big, losers average losers

Due to the extremely fast listing of projects in the cryptocurrency market, Multicoin initially only had a good ICO project that hedge funds were chasing. Starting in 2018, people no longer regarded cryptocurrencies as a fleeting fad, and began to pursue long-term influence, and began to open up private token issuance in the early days.

Multicoin soon established a dedicated venture capital fund. This crossover fund model brings great discretion to Multicoin: early investment in good projects, close cooperation with entrepreneurs, if you have a strong belief in a project, you can also use secondary tools for longer-term to hold.

The assumption of Multicoin’s investment decision is to invest in projects that they think can be held for 10 years. This is the so-called ability to continuously grow long-term and compound, which is homologous to Tiger’s overall “Long the internet” growth strategy 10 years ago .

Multicoin hopes that the thesis that has been debated over and over again will be fully played out, and the strongest gains at the end of the cycle will be obtained, which requires firm belief and sufficient patience. This is why during the crypto winter of 2018 and the Black Thursday in March 2020, Multicoin firmly held large positions such as Solana and Helium (these teams were almost unable to turn around at that time).

When the crypto market was retreating, Multicoin even raised several large positions including Solana, and even invested in the decentralized music streaming media Audius in a “counter-cyclical” manner, together with later Livepeer and Braintrust. , has become an important case under the motif of “web3 digital sovereignty and application logic”. ( We will expand on the investment theme in the second half of this article )

At the lowest moment, Multicoin decided to stop trading and stick to its bets one by one. In 2018, despite the fiasco of EOS, it still outperformed Bitcoin and Bitwise 10 (an important index fund in the crypto circle) by more than half. This was a decisive turning point for Multicoin: since then they’ve been less obsessed with so-called “market timing” and more focused on the size and value capture of the opportunity – as Tushar puts it, “We realized that you can never predict black Swans, you can’t predict exactly what will happen in March from January 2020. We decided to stick to our strengths:thesis-driven asset selection .” 

Before moving on to their thesis-driven strategy in the next chapter, let’s take an example: after Multicoin’s bet on EOS fell through, the previous “Ethereum centrists” were gloating. However, the two founders did not withdraw all their previous thinking about the Ethereum issue: the expansion route of Ethereum changed rapidly, but there was not enough speed to deliver, many talented developers at the community elder level have left, and Lianchuang Gavin Wood has moved to On a new project Polkadot, and with Vitalik’s slowness of action, the congestion and low throughput of Ethereum also make it impossible to see a good future.

They realized that EOS’s failure was in its resource allocation model, etc., not that their thesis was wrong. They quickly figured out why they bet on the wrong horse, stuck to the original thesis, and in the process of searching for an “Ethereum challenger” finally pitched projects like Solana with a thousand-fold return.

Multicoin does not want to cast a wide net, but wants to catch the biggest fish and catch it with all its worth .When asked about Layer 2 and the most promising zero-knowledge proof rollups recently, Kyle said frankly “It’s not something we do, we don’t pile into this trade”, and admitted that betting on Starkware back then was luck. Starkware was invested by them together with Paradigm, Sequoia and other top funds. Multicoin did not repeatedly discuss the investment logic, nor did it continue to systematically deploy Layer 2. These moves are an honest indication of how much they believe in and endorse the field. This focused investment philosophy is also the reason why Multicoin can have several star projects that drive huge excess profits.

The two founders agreed that Multicoin is more risk-averse than its peers and is one of the few crypto funds that has “give up” on managing volatility and instead manage risk from a qualitative perspective. Paul Tudor Jones’ “Losers Average Losers” is their creed . Interestingly, the big guy entered Bitcoin early and publicly spoke to CNBC that it is an asset that is more resistant to inflation than gold, and it is a part of traditional finance that gradually accepts crypto. Big iconic characters.

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

04.

Thesis-driven deduction madman

Thesis-driven is easier said than done. Opportunists are always reactive and receptive to evaluate new things emerging in the world. Tushar bluntly said that this is no different from brushing Tinder. The true thesis-driven investors form a predictive view first, and like the roadmaps that many Web 3 projects are now publicizing, they will have their own “EEG” in full view.

To put it to the extreme, the first mission of Multicoin is not to invest in good projects, but to form a good investment theory. Recalibrate the “should” of the Web 3 world in pure first-principles, and “bet” all in once it is determined that an element will occupy a significant strategic position in the future. Although the two founders like to use the word “gambling”, the theoretical construction behind it is actually surgically refined.

Tushar published Trade-offs in the Decentralized FTX Space , and four months after proposing the idea of ​​”Decentralized FTX”, they found their favorite project Perpetual Protocol, valuing its deep liquidity and high leverage; The repeated assertion of “digital sovereignty in tech giants” led to the subsequent investment in projects such as Audius and Project Galaxy, which directly put their “IP” in the hands of end users.

At their voting meetings, 80% to 90% of the time is devoted to discussing the market, debating existing problems, possible models, shortcomings of existing models, and future technological innovations based on first principles, “to ensure that Only when there is no discernment can you know what you are underwriting and what value it can create.” 

Just as they deliberately provoke discussion by constantly expressing their opinions in public, voting is a venue for exposing any ill-considered and untenable logic, and this “habitual, constructive opposition” becomes The communication method that Multicoin relies on most, is efficient and in-depth. ” After walking out of the meeting, we can either strengthen our previous ideas, or we can overthrow and start to build a whole new set of theories .”

Interestingly, in the first ten minutes of the IC, they all silently held the computer and commented on the memo at the same time, in order to make the discussion more flat, everyone can think independently without any presupposition, and finally collect Get up and discuss.

Multicoin has a fairly balanced team. Kyle is fanatical (hereafter, the text is like his), Tushar is calm, and their roles are the establishment of thesis and the management of the investment portfolio. Kyle speaks fast and has a typical argumentative personality. Although he offended people in the circle by publicly criticizing some projects in the early days, it can be seen that he has not been able to think more clearly about “our sovereignty in the digital world”. Tushar is relatively mild. When speaking, he likes to look straight ahead with strict logic. He often says “We’re missionaries not mercenaries”, believing that encryption technology can broaden the boundaries of human technology and gain a greater degree of freedom.

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

Miraculously, two founders who fled Wall Street have recruited two key founding members from there: Brian Smith, a former Tiger Management analyst and former VP of finance at a publicly traded e-commerce software provider, served as the COO and CFO. Matt Shapiro also has a banker background and quickly became a partner.

I have to mention the addition of Mable Jiang here. The opportunity was when everyone criticized Binance for not being decentralized enough, and Multicoin took on the role of anti-consensus. At that time, Kyle also realized that his understanding of the Asian crypto market was not enough, so he moved to China for more than a month, looking for responsible An investor in the Chinese market, he met Mable at a meeting and eventually invited her to join him (Mable just left Multicoin to become the chief revenue officer of StepN, a recently popular move-to-earn project). It is also because of their mutual passion for Binance that Sam Bankman-Fried of FTX and the two founders hit it off. Later, Multicoin bought the now $60 FTT at $5 in Q4 2019.

Talking about the portrait of future crypto investors, the two founders half-jokingly said “There are lots of things to be unlearned”. It is true that traditional investors always think about putting gates and charging toll, but this set is completely inapplicable in the encryption world. It is necessary to get used to an open source and non-access business model in order to truly understand Web3 entrepreneurs. And produce productive conversations.

05.

“The Third Venture Partner”

Multicoin firmly believes that investors also have the ability to create alpha with the entrepreneurial team. From token design, on-chain governance, protocol changes, network participation, to cryptocurrency market insights, and even BD and brand media relations, the Multicoin team can provide substantial assistance to investee companies. Take their two biggest projects, Solana and Helium , for example.

The founders of Solana attracted the attention of Multicoin because of their “nearly obsessive pursuit of blockchain performance”. After investing in Solana for the first time in early summer of 2018, Multicoin continued to gain shares from some “unwilling” investors. You must know that Multicoin faced the same turmoil as EOS when investing in Solana, but this did not prevent Kyle and Tushar from actively participating and calling for orders.

One of the magic touches may be the cooperation with Sam Bankman-Fried: build a decentralized exchange Serum on top of Solana, and use Solana’s performance to insert it into Serum’s on-chain order book, allowing developers to use Solana Build scalable DeFi applications more easily. This is an important step in Solana’s growing ecosystem. Multicoin also openly ridiculed Uniswap on the opposite side of Serum: in the order book on the high-performance chain and the AMM on the low-performance chain, Multicoin supports the former without hesitation, precisely because they are the believers of the unified chain and do not allow low-performance chains. compromise.

The founder of Solana regards Multicoin as his “third entrepreneurial partner”, and being “the first person to think of when encountering a problem” is the realm that many VC investors want to achieve.

Likewise, after coming into contact with the Helium project, Tushar and founder Amir had numerous phone calls discussing Helium’s token economy. The original thesis of Multicoin is: data is the largest yet underfinancialized commodity in the world, and we need a more economical way to transmit data. Based on this belief, Multicoin fully participates in governance and highly concentrated bets on Helium, deploying more than 11% of the funds, and following up through hedge funds, it also adds HNT for the LP’s separate operation of SPV.

In return, the Helium team gave Multicoin preferred stock, and the Founder’s Reward, which is distributed proportionally as the network expands, almost delivering returns to Multicoin in the form of a perpetual annuity.

Tushar, founder of The Graph (aspires to be a unified search engine for Web3), said that their 10-minute talk at the Solana Developer Ecosystem Conference completely changed their course for the next three months. A fellow crypto investor commented on Kyle, “He will pick fights for whoever. No fight is too big for Kyle Samani.”  

06.

Investment Themes and the Future of Crypto

The three investment themes of Multicoin are: open finance, Web3 and non-sovereign currencies.

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

Open finance: the grand ideal of financial integration

Open Finance represents the grand vision of the two founders: to enable transactions in global capital markets to be conducted with full trust without guarantees. No middleman, no need to worry about counterparty risk, your assets can be transferred between platforms in seconds.

In a conversation with Micky Malka, founder of Ribbit Capital (an excellent fund focused on fintech), Tushar talked about what exactly is the competitive advantage of DeFi, and put it down to the consumer relationship: It’s all about who owns the customer relationship. Because the moat that really determines the value of Defi is how many relevant parties (developers, consumers) they can attract to accumulate value.

Bitcoin itself firmly grasps consumers in the form of social contracts or value storage/value-added, but for Defi, people do not have a natural sense of attachment and belonging to a certain protocol itself, they only want the best. Rates, liquidity and experience. This is why there are now some aggregators that distribute consumer orders to various Defi venues to get the best configuration, and they have a better relationship with consumers.

Micky used an image analogy. There may be only one barber shop and one hotel in his small town in Venezuela, but there are always two or three banks, and the banks compete with each other on the small differences in interest rates and services. Financial services has always been a highly commoditized industry, and nothing can be imitated, but how to win?It’s all about the brand. In order to have a consumer relationship, perhaps DeFi needs to follow the old path of traditional finance to pursue brand effects and explore the core characteristics of brands that can ultimately gain consumer trust. Before that, similar to Sushiswap’s fork and Uniswap, Tweak the situation will not change.

Looking forward to the end, Kyle gave an analogy to traditional finance: there will be a “Defi-native” “prime brokerage” to support the blockchain version of the Perpetual swap contract – you can exchange between cryptocurrencies and fiat currencies at will, Feel free to buy financial products from all over the world . In the future, traditional finance and Defi will coexist, but Defi’s obvious low transaction costs will definitely attract more people to transfer.

Of course, the future of Defi is by no means smooth. The EU Commission has issued a regulation that imposes extremely high funding requirements on asset-backed stablecoins and prohibits tokens with interest. This is also the bear case that Multicoin has thought about: if it is considered a threat to its sovereignty by the government, it can only be traded in the gray market after being banned. In addition, the “next investor” in the crypto world will only have less understanding of financial concepts, so trading in more complex ways (overlay derivatives, digital asset management, etc.) will face some resistance.

Web3: Reimagining how human economic activity is coordinated

The Web 3 theme of Multicoin can be summed up in one sentence, which is a trustless network that allows people to coordinate economic activities more freely and efficiently. In fact, it extends the logic of the previous Defi to all aspects other than finance.

Specifically, many activities in modern society rely on a centralized entity to allocate resources: AWS for storage, AT&T for communication, and Google for query. Behind this are high transaction costs and serious centralization risks (issues of data privacy, single points of failure, etc.).

Some projects try to decentralize these and decompose the infrastructure we took for granted in the past world into the smallest units of value, so that every Web3.0 resident can realize resources that were impossible to realize in the past : social networks ( SocialFi), hard drives (Arweave), network bandwidth (Helium), and even attention (Brave).

Among them, there is a very interesting sub-topic: Web3 sharing economy, Multicoin invested Helium, The Graph, Arweave, RNDR, Audius and other projects under this motif.

  • The background of Helium is that with the popularization of the Internet of Things and 5G, the network speed and layout requirements are increasing day by day, and the traditional communication model of centralization and heavy capital is unsustainable, so Helium uses shared bandwidth to establish a decentralized communication network;
  • The Graph hopes to be a unified search engine for Web 3, making blockchain data universally accessible and usable, and Dapps do not need to rely on centralized service providers;
  • Arweave not only disrupts AWS, but also solves the problem that it is impossible to store all data on the chain under the scalability limitations of Ethereum, using a distributed permanent storage network of a shared network of idle hard disks;
  • RNDR is a rendering network for distributed GPU computing arising from the huge and complex graphics rendering requirements brought by the Metaverse;
  • Audius returns the control, copyright and revenue rights of music to the musicians, removing the middleman between musicians and fans, which may redefine IP and the fan economy:

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

In this way, without the mediation of a centralized entity, network participants contribute their own digital resources (including computing power, bandwidth, etc.) to complete a Web3 economy with a specific mission (Arweave storage economy, Helium Communication economy) tasks, and obtain token rewards corresponding to their resources, and share their value while jointly building the vision of the economy.

Almighty public chain: a future without bridges

This part only represents Multicoin’s prediction of the future of encryption. There must be repeated strengthening of the bets that have been placed and the passion to call for orders, but the arguments of the two founders are indeed worth sharing.

From the perspective of feasibility, Tushar used an analogy to describe the historical role of cross-chain bridges: in the 1990s, all technicians thought about was how to connect everyone’s intranets (intranets) with bridges and weave them into a network. Until the concept of internet (Internet) appeared, it was found that a global network could be used . Similarly, the cross-chain bridge is also a transitional form. Once a complex application layer is added, the friction between systems will be difficult to handle. In the long run, the cross-chain bridge will gradually withdraw.

Kyle added a point from the perspective of efficiency: cross-chain bridges will increase latency, increase value and data migration barriers and gas consumption, and application compilation may require high system consistency and interoperability, which we don’t know yet. Which things should be on the same layer, but in general only one shard is best.This is why he believes that there will be no niche public chains, such as game public chains, DeFi public chains, etc., because there is too much demand for cross-chain bridges.

Therefore, Multicoin does not believe in multi-chain co-prosperity, and believes that there may be a multi-chain world in the next year or two, but it should be reduced to 2-3 almighty public chains in a longer time dimension. The public chain will slowly wash away the sand, and the turning point may be when the Internet giants choose a chain to build applications . Duopoly is the base case of the public chain in their minds, just like mobile OS is also a duopoly, because of the natural economies of scale and aggregation effects.

Non-sovereign digital currencies: beyond the trust-based economy

At the Multicoin 2019 summit, Kyle mentioned: The stability of fiat currency depends on a powerful national government, but there are 500 million people in the world living in a society with an inflation rate greater than 10%. For these people, if they do not Find a channel for asset preservation, and their net worth will be reduced by at least 10% every year. Digital currency may play the role of digital gold, helping them maintain asset value.

He also believes that from the perspective of asset appreciation, digital currency is also a very market-expanding capitalization method (people can seek income through pledges, etc.); finally, a large part of the wealth created in the crypto world still has to be in the Digest in this world (such as buying NFTs, social tokens, etc.).

Multicoin Capital: a thesis deduction madman who disrupted Ethereum's crypto party with a hundred times the return of the king

Multicoin believes that the above 4 points add up to a market size of 40-100 trillion USD. These are the future of crypto they see.

Reference

https://www.chaincatcher.com/article/2066183

https://www.chaincatcher.com/article/2061703   

https://www.chaincatcher.com/article/2068202

https://www.forbesindia.com/article/cross-border/want-to-make-money-in-crypto-currency-question-everything/57977/1

https://www.trendfollowing.com/losers_average_losers/

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