2023-02-16 04:31:41 UTC


Last year, I thought "Web3" was a good all-encompassing term that captured cryptocurrencies (bitcoin and stablecoins), smart contract computing (Ethereum and other "Layer-1's"), decentralized infrastructure networks (video, storage, sensors), non-fungible tokens (digital identity and property rights), decentralized finance (financial services to swap and collateralize crypto assets), the metaverse (the digital commons built in game-like environments), and community governance constructs (decen- tralized autonomous organizations).
We're down 80% since then. Ever since we pivoted to the Web3 moniker, there's been industry-wide carnage. So I recommend we retire the term.
We need to get "Back to Crypto" in 2023.
  1. More personal wallets (from my cold dead hands) than exchange margin accounts (bad)
  2. More privacy (none of your business what I do) than institutional adoption (slowww down)
  3. Permissionless financial & social applications (live and let live) vs. ponzinomics (fraud)
If you're new to crypto, I also recommend you check out Bloomberg Reporter Matt Levine's recent Crypto 101 masterpiece (that was recently published as an entire BusinessWeek issue). Building off of Matt and the prior Messari works has freed up my headspace for more new, original content, without leaving newcomers in the dust.

It makes sense to start with a recap of last year's introductory "Narratives & Investment Themes" chapter and see what held up. How did last year's report do under the stress test of an 80% decline in prices and an absolute bloodbath for crypto startups?

Pretty, pretty good, actually.

Here's what happened in 2022, and what's in store for 2023. 

Winter is Here: It's Time to Build

Last year, I started out with a bang:
“My first prediction for 2022: things will get worse before they get better in the "real" world. Inflation will remain above 5% throughout 2022 (70% confidence), while late year interest rate hikes stall the stock market's momentum and hurt growth stocks (60% con- fidence the S&P dips next year)...Though I waffle on where we are in this particular cycle, the tail winds remain strong and the capital markets flush. So my probabilities are split among three scenarios: 1) most likely, we experience a blow off top before the end of Q1 2022, followed by a shallower, but still painful multi-year bear market…Ironically, the most bearish case here (Q1 blow-off top) may be the most bullish long-term.”
That's more or less what happened. And the speculative mania is now behind us.
A lot of people lost money in 2022. Some poorly managed companies went under (normal in capitalism, pre-2008). But many of the survivors are well capitalized and shipping product. The core theses generally remain unchanged, and now we're left with true believers and long-term builders – fewer gamblers, scammers, and tourists.
I live for the build years.
We can focus on building life rafts for those worried about inflation and currency debasement; "exit" technology that helps people vote against two party systems and authoritarian rule alike; and decentralizing solutions that check the incumbent powers in tech, finance, and government.
The core substance of crypto hasn't changed: in a world where few, if any, of these institutions are viewed as both competent and ethical (a16z: How to Win the Future, slide 8), crypto offers a third path that seems increasingly credible, despite its volatility.
Need a globally accepted asset that you can store in your head "just in case" you need to emigrate from a failing country? There's Bitcoin. How about a platform that routes your app around Big Tech censors? There's Ethereum and a multitude of emerging Layer-1 ("L1") protocols. Can't access credit? There's DeFi. Hate 30-50% take rates for artists? NFTs. Trying to fund research for your own rare disease cure? DAOs.
This isn't boosterism. Even Bloomberg's Matt Levine, a crypto skeptic, sees the potential:
"Perhaps this is all a self-referential sinkhole for smart finance people, but honestly it would be weird if that's all it ever turned out to be. If so many smart finance people have moved into the crypto financial system, if they find it so much more enįoyable and functional and productive than the traditional financial system, surely they'll eventually figure out how to make it useful."
The debate doesn't really center around whether crypto could be good these days. 

Like most other areas of tech, crypto can be great or it can be abused. It all depends on the specific product, the ethos of the builders, and the rollout strategy.

If tokens help solve the "cold start" problem of network effects-reliant businesses in their battle to disrupt incumbents, that's a good thing. Good token designs will look more like growth capital than seed funding. (My litmus test has always been: does this token create an early user base and improve the product, or does it primarily reward the founders and VCs?) Tokens only work in markets where network effects could exist. Otherwise, you're transparently partaking in a multi-level marketing scheme.

Do the knives get better when Cutco sells more of them? No. Most people lose time and money getting sucked into the machine, and it's annoying to friends.

Does a crypto product get better when more people are added, in terms of liquidity, user interactions, and/or application interoperability? Yes. If a token can accelerate a product's time to usability, and reward its beta testers, it's a powerful tool.

Let's build more powerful and sustainable tools this winter. 

Crypto is (Still) Inevitable

It's easy to be bullish in times of euphoria. But you only see who's got staying power when the tide goes out. It's been a bad year in many respects, especially for the greedy, the levered, and the unethical.
The long-term builders may have been temporarily hurt by association, but they haven't been the ones who perpetuated frauds or fleeced investors. These innovators (open-source software and infrastructure developers) will be here long after the trash (opaque lenders, trading bucket shops, ponzinomic promoters, "genius VCs," and paid hype men) from this cycle are long gone.

And good riddance! (We'll talk all about the crypto credit bust in Chapter 3 on CeFi.)
Beneath the wreckage is a stronger foundation than we've ever had before: $10s of billions in capital, an influx of world-class talent, four years worth of demographic change towards digital natives, and dozens of "zero-to-one" innovations in crypto scalability and application primitives. 

Crypto remains inevitable because we've made significant progress in the build-out of bitcoin, stablecoins, distributed computing, blockchain scalability, decentralized financial primitives (DEX, lending, asset issuance), and governance structures.

These innovations will not be uninvented.

Bitcoin has entered its "historic buy" range by several measures. Stablecoins now represent four of the top ten crypto assets. Their volumes rival global card networks and banks, and they can actually generate *sustainable* yield now that the true risk-free rate of return (U.S. Treasuries) is above zero. The Merge, the software equivalent of the Moon Landing, went through without incident, and other Layer-1's like Cosmos, Solana, and various rollup chains made significant breakthroughs as well. Fees are way down as a result!

We're two years into a secular bear market for DeFi, which still faces technical headwinds (hacks) and regulatory challenges, but the core primitives (Automated Market Makers, Flash Loans, Protocol Controlled Value, etc.) are all here to stay. NFTs are data wrappers that open the door for secure sharing or transactions of any intellectual property, synthetic asset, consumer digital good, or identity token on-chain. They may look like toys to start, but they are almost unfathomably important as a technical primitive. We now have true DAOs, with on-chain voting, delegation, and community treasury management. These entities cross borders and allow for the rapid formation and wind down of online communities and collectively-managed property. We may be in crypto's 3rd inning, but DeFi, NFTs, and DAOs have barely stepped into the batter's box.

Don't get discouraged. The dream lives on.

Surviving Winter, Redux

You heeded my advice last year, right anon?

At the absolute height of the bull market, I wrote about what exactly would happen in a crypto winter, and warned that the medium-term concern for me was "From what height do we crash?" even if I was neutral in the short-term and mega-bullish in the long-term. I've lived through multiple crypto winters and warned that many would lose faith amidst a multi-year grind lower in asset prices, stark political and regulatory headwinds, and stagnating user enthusiasm and product demand.

I take no pleasure in saying I told you so, but...

"In addition to eating big paper (or real) losses, you'll see people have breakdowns, go bankrupt due to over-leverage (or poor tax planning), quit otherwise promising proįects, turn nasty, depressed, or apathetic, and generally lose sight of the longer-term potential of crypto. To make matters worse, the next bear market will be a regulatory nightmare, and we won‘t have the bull market vibes to help defend ourselves against all of the consumer protection, fraud and abuse, systemic risk, ESG, and illicit activity FUD that our enemies will throw at us. At the same time, the “grassroots” crypto herd will thin because it’s tougher to wage war when you‘ve lost 90% of your savings and need to go find a real įob again."
Do you still believe?
If you're reading this report there's a good chance that you do, but are now wondering how best to navigate a prolonged winter. The answer is as simple as it is challenging and unglamorous:
In many respects, it's easier to build in bear markets than bull markets. There are fewer distractions, real product-market fit becomes easier to identify without the noise of a token, and the weak and flaky contributors wash out of the market.
There's also a big difference between this crypto winter and previous cycles: dry powder. In 2015, cash was hard to come by, and even some of today's industry leaders struggled to raise capital at the time (Kraken and Chainalysis are two unicorns that come to mind). In 2018, there were a few crypto curious investors, but many of the projects who raised money via ICOs had squandered their balance sheets by holding ETH through a 90%+ decline.

There are bridges to build, standards to set, primitives to develop, users to onboard, infrastructure to stress test, and product stories to tell.

There's no rest for the weary, and if you played your cards right, you unwound levered bets, paid your taxes, didn't get greedy day trading, and parked some assets in cash for a rainy day. You're probably feeling ok right now, despite the market backdrop. We'll survive and advance and look back on this year with pride, because we survived.
What else would you do, anyway? Go work in a bank?

How Low Can We Go 

Last year I asked, "doesn't it just feel a little toppy?" and tried to show people just how far ahead of our skis we were getting when it came to crypto asset prices, and how close market caps were getting to what looked more like 10 year TAMs. The drivers of asset prices were blinking "sell" but many of us just couldn’t help ourselves.
Let's flip the script this year, and ask, "how much lower can we go?"

1. Bitcoin: My favorite metric for BTC from cycle-to-cycle has been Market Value to Realized Value (MVRV). It has been nearly infallible as an indicator for how hot or cold the market has gotten. This simple ratio looks at current price times supply (market cap) versus the cumulative "realized" value of "free float" coins (those that have moved in <5 years) at the price at which they last moved on-chain. Market cap can stay the same when realized value spikes and vice versa. It's a dynamic measure that accounts for flow. An MVRV that hits 3 has meant "sell right now" and a MVRV below 1 has meant "start accumulating" for crypto's entire history for BTC.
Where are we now? January 2015. December 2018. i.e., Sell-a-kidney-to-buy-more territory.

(Source: Look Into Bitcoin)

BTC is beginning to act more like a credible neutral reserve asset (we'll talk about this "outside money" concept more in the Bitcoin section). From both a MVRV and risk return standpoint, BTC seems a bit more attractive today. Bitcoin's parity with gold would yield a 25x return, so there's a lot to like in adding a 4% position in digital gold for every ounce of gold you buy. At today's prices, bitcoin-gold parity would bring us a $500,000 bitcoin.
2. Ethereum: Is ETH a tech platform or distributed bank? A little bit of both, perhaps, but I'd argue the network is more comparable to the latter. The best comparisons to Ethereum on the tech side might be to AWS, Google, and Microsoft. After all, the protocol is a virtual machine and "world computer." But its economic drivers (MEV and transaction fees), and unit economics (financial services' basis points vs. cloud margins) make it look more like Visa or JPMorgan. There's nothing wrong with that! Ethereum is already a top five financial platform if you look at financial services, and ETH has become a disinflationary asset with its Merge to Proof-of-Stake, minimizing the dilutive impact holders will experience going forward.
The question is whether you think there is enough real value flowing through the Ethereum platform today and in the medium-term to justify a 5x in valuation that would catapult the asset beyond financial services and onto the "Big Tech" leaderboard. I grok the favorable post-Merge Ethereum economics, but I don't see a scenario where ETH leapfrogs Web1 giants any time soon. Too much of Ethereum's current transaction processing is finance and trading related, and DeFi's unit economics will face pressure in a high-inflation, high-interest rate environment.
Apple's P/E is 23 and growing. Microsoft's P/E is 24 and growing. Google's P/E is 16 and growing. Ethereum's "P/E" is 195, and its revenues are shrinking, with protocol revenues near multi-year lows. The crypto market is still giving ETH simultaneous credit as a monetary asset (relative value to bitcoin), a computing platform (cloud startup multiples), and a yield generator (financial stock thanks to staking). If any of those three narratives cool, it will face headwinds. (Long Bitcoin dominance?)

3. Other Layer-1's: The other thing to consider in the ETH bull case is the network's potential substitutes, of which there are now many, though none have yet emerged as true peers. ETH currently enjoys a 70%+ market share in what we'll call the "neutral" L1 space (netting out Binance's BNB token). In other words, there's about $155 billion of ETH and $57 billion of "other L1" assets. Whether you think that's right or not will largely depend on how excited you are by the various other L1 network's locked market caps and value capture mechanisms.

The "venture and insider" ownership of Solana, Avalanche, and Aptos ⭐ tokens, for example, are still quite high. Will selling pressure hit those networks once supply unlocks? Likewise, value capture for other alt-L1 chains, such as Cosmos, remain unclear (though recent efforts have been made to fix that). Will any other L1 developer ecosystem catch up? Will any rival Ethereum's unit economics as a high value settlement chain? The relative value trades all come down to business development wins (app distribution) and recruiting wins (can you attract developers to build on non-Ethereum blockchains).

The "Ethereum killers" may have the money to compete aggressively, but as an investor your choices are to either pick winners, or buy the basket. (Short Ethereum L1 dominance?)
4. DeFi: The entire universe of free-floating DeFi tokens currently trades at less than $15 billion. That doesn't even crack the top 100 banks by market cap. DeFi's market share of global financial services is a measly 0.2%. Meanwhile, Total Value Locked ("TVL," a measure of user assets deposited into a protocol's smart contracts) in DeFi is just $40 billion, barely good enough to crack the top 50 US banks by assets, and a shade bigger than infamous Nashville juggernaut, Pinnacle Bank.
Perhaps we are finally nearing the bottom of DeFi's trough of disillusionment. It will be a long road back to DeFi Summer 2020, but positive regulatory developments, improvements in contract security and development best practices, and lower transaction fees thanks to scaling breakthroughs could make DeFi one of the best risk reward sectors of crypto for years to come. Remember, the core DeFi protocols were built during the last bear market.
5. NFTs: Any given NFT project can go to zero, but NFTs as a data construct will eventually wrap around tens of trillions of dollars worth of assets. We're at about $8 billion today, so there's…uh… room to grow. But I'd rather be long picks and shovels infrastructure businesses vs. specific projects in the NFT space, as almost nothing I've seen has established a "fundamental" driver of value beyond art, and the jury is still out on which art will have staying power. You better like the jpeg enough to hold it forever vs. flip it.
6. DePIN: Decentralized physical infrastructure networks (DePIN, or "token-incentivized," TIPIN, which I don't like and refuse to use, since it sounds like a NSFW government agency) will be one of the most important areas of crypto investment for the next decade. Storage solutions like Filecoin ⭐ and Arweave, decentralized wireless networks like Helium, and other hardware networks are critical to the industry's long-term viability. They could also disrupt an absolutely ginormous set of monopolies. Legacy cloud infrastructure is a $5 trillion global market cap sector, while DePIN is just a $3 billion market cap sector for crypto players. Not a bad sector to spend time in. We're tracking it quarterly.

Bear Market Building 

If bear markets are for building, it begs the question: what should we build?
For context, let's start with some history. In 2015, the answer was bitcoin trading and custody infrastructure, and dozens of billion dollar companies were formed to provide the on-and-off ramps between the crypto economy and legacy financial system. In 2018, the answer was decentralized applications, and dozens of large DeFi (USDC, Uniswap, Aave), NFT (OpenSea ⭐, Punks, ENS ⭐), and decentralized infrastructure projects (Filecoin ⭐, Helium, The Graph ⭐) were incubated during the depths of winter, while Ethereum and an entire ecosystem of L1 and L2 blockchains emerged to satisfy demand for on-chain blockspace. Look at the biggest problem areas in 2022, and you'll likely spot the sectors that will spawn the next unicorn solutions.
  1. Want to solve systematic risks? We'll need investments in disclosures standards (hi, Messari!), proof-of-reserves and on-chain monitoring infrastructure, and crypto's GAAP accounting moment to discern fundamentals vs. greater fool investing.
  2. Want to solve the hacking problems? This year was a disaster for on-chain hacks, whether it was poor smart contract design, economic model exploits, governance deficiencies, key security issues, social engineering attacks, and more. Solving security issues at scale (with AI monitoring, algorithmic circuit breakers, etc.) will be huge.
  3. Want crypto financial markets to be competitive? Over-collateralized lending isn't too appealing vs. legacy finance. But you can't have undercollateralized lending without major default risk…unless you can leverage new identity and reputation primitives.
  4. Want to ensure Amazon or Google or Apple can't shut down crypto? We still need scalable decentralized hardware networks, jailbroken device app stores, and decentralized data marketplaces that begin to siphon data from our soon-to-be unstoppable AI overlords.
  5. If you aren't too creative, but you are entrepreneurial, you can always follow some of the biggest VCs in the space, and ask what they wish existed. A lot of them publish requests for startups, which provide a great starting point to get your creative juices flowing and find areas of interest and potential founder-market fit. 
How can you not be excited to build? The spoils are there for the taking. We just need the right teams to get going and create the markets.

Decoupling of Cryptos: Back to the Basics

This has been a good year for the fundamentals enjoyooors. For years, Bitcoin and Ethereum investors have grappled with how best to fairly value their ecosystems without much financial precedent. But we actually have real data – and tools – to support today's asset valuations today.
Did you know that you can track quarterly financial statements directly from the blockchain for 40 top protocols?

(Source: Messari's
Q3 State of Filecoin)

Or did you know that you can essentially front-run the SEC's obsolete financial reporting process, and predict a confidence interval for Coinbase trading volumes simply by looking at Uniswap and adding 40-60%?


Or that you can confidently say that we're now back down to just 13 decentralized applications with $10 million in run rate revenue? (Ugh.)


The next cycle will be driven by real usage and sustainable protocol economic models. And the data above is freely available to anyone who knows where to look. In fact, we're investing aggressively in the build-out of better protocol metrics. We think it's time for a GAAP or IFRS standard for crypto assets. (Learn more about the on-chain apps we're building, and join us!)
By the time the regulators figure out what disclosures should look like for the crypto economy, this will be a fully solved problem. Value investors and consumer protectors rejoice: next cycle's rally just might reflect fundamental user adoption, and it will be free for all to investigate live.

VC: There's (Still) Money in the Banana Stand

"It's a seed round in a fruit protocol, Michael. How much could it possibly cost? $10 million?” - (RIP Lucille)
In all of 2021, there were 247 investment rounds into Centralized Infrastructure startups, 500 investment rounds into Decentralized Infrastructure and NFT startups, and 218 rounds into "CeFi" startups, representing $28.5 billion in total funding. In the first half of 2022 alone, there were 183 centralized Infrastructure investments, 596 in Decentralized Infrastructure and NFTs, and 186 in CeFi, representing another $27.4 billion in total funding.
Only the DeFi sector total deal flow was slow (from 348 in 2021 to 226 in the first half of 2022), but there too, its total dollar funding eclipsed the 2021 full-year numbers ($1.9 billion in 1H vs. $1.7 billion in 2021).

But the slowdown became real in the second half of the year:

Crypto venture markets have come crashing back down to earth in 2H, and we're on pace for a 70%+ reduction in investment dollars vs. the first half. The total investment pace has slowed as well, and there's less dry powder for later stage crypto deals. The companies that raised in 2021 and 2022 should have lengthy runways – if they're smart. That capital is fresh, which means it should last an average of another 1-2 years at minimum, but I'm not confident that many up only founders will make the adjustments necessary to survive beyond then.
The venture markets for more mature companies will likely get more ruthless in 2023. It's put up or shut up time for Series A+ companies to demonstrate their businesses are fundamentally sound in spite of the bear market and its pressures, and we expect to see a significant reduction in deal sizes and pace. We'll see if 2021's Chad investors stay Chads.
But the startup winners might be able to take advantage of some epic M&A opportunities. (Messari has completed several tuck-ins this year, including VC tracker, Dove Metrics, which collects the fundraising data in the chart above, part of our Enterprise package.)
2021's fund vintage – capital deployed at all-time highs at the tail-end of the zero interest rate environment – is unlikely to look very pretty. But now that reality has set back in, it might not be a bad time to deploy capital professionally.

The Macro Rebound vs. The Dumpening

Everything so far in this report has assumed that the bear market will continue for the foreseeable future, and there is no "V-shaped recovery" for the crypto markets. I think that's a fairly safe bet, but…
  1. It's still all about macro (and regulation). The resting market sentiment is that we will have a recession in 2023, with some debate over its potential magnitude. The market also seems to trust that central banks will continue to tighten until inflation is under control. Though contrarian, there are some investors who think it's more likely that the Fed will pivot once the recession really gets going and accept multi-year high inflation in lieu of a depression or global reserve currency crisis (Watch: Luke Gromen). If that's the case, then physical commodities like gold and oil would perform strongly. And digital gold and digital oil might follow suit. Macro forces led the 2020-2021 crypto bull market. It led to the 2022 collapse. Why not the 2023 recovery?
  2. We don't usually predict the next major market catalyst in advance. But I'd keep a close eye on the 2022 developer report from Electric Capital for a peek at where there might be kindling for the market recovery.
On the other hand, we still have a number of negative potential market shocks.
  1. For Bitcoin, miners are puking just about everything they mine to cover operating costs and debt service. That's predictable weekly selling pressure that shows no signs of abating. It is likely that the Mt Gox bankruptcy proceeds (137,000 BTC) are distributed in early 2023. And although it wouldn't hit the bitcoin spot market directly, it's plausible that DCG and Genesis might be forced to sell up to ~$60 million shares of GBTC per quarter for the foreseeable future.
  2. Ethereum's post-Merge supply dynamics are disinflationary, though it's unclear whether the tax consequences of post-Merge staking rewards will lead to significant spot selling pressure in the market in order to cover liabilities incurred from staking income. Even though miner's selling pressure is a thing of the past for Ethereum, this new tax selling impact is new and difficult to predict.
  3. Beyond BTC and ETH lies a mess of project-specific selling. L1 and DeFi tokens with large token treasuries that unlock for founders or early investors; forced selling of positions held by bankrupt funds or collateral held by distressed lenders; poorly designed tokens that suffer from economic death spirals. We'll get into some specifics later in the report, but for now, know this: there is currently more than $50 billion worth of supply that could theoretically hit the $250 billion "long-tail" of assets.

Buyouts vs. Bankruptcies

It's hard to believe how bullish we were last year about the slate of upcoming crypto IPOs. BlockFi was a rocketship! Circle was going to SPAC! Blockchain, DCG, and Kraken looked like they might be next. GBTC seemed to have a fighting shot at approval given the SEC's approval of several inferior futures-based ETFs.
Instead, in the past few months, BlockFi filed for bankruptcy, Circle pulled its SPAC, Blockchain took an emergency down round, Kraken has laid off 30% of its staff, and even DCG might be on the brink due to levered share buybacks and a disastrous six months for its lending subsidiary Genesis. I mean, Coinbase debt is now yielding 15%.
None of this is great. BUT, it does present a compelling potential entry point for larger institutions who believe crypto will have a long-term role in the global economy. If you believe in crypto, doubt that you will be able to innovate your way into a market leadership role organically, and believe that your compliance and regulatory cloak position you well to clean up a technically sound, but operationally inferior "crypto institution," you might want to shoot your shot in 2023.
Fidelity or Blackrock might like DCG in a distressed buyout situation. JPMorgan might jump at the chance to lob in a hostile takeover bid for Coinbase at just 5% dilution. If the institutions were, indeed, coming last year, then you have to wonder whether the barbarians are at the gates and Wall Street is ready to execute a slow takeover of crypto.
I'm not saying that I particularly like that future.
I'm just saying it could happen, and it's looking more plausible by the day that this downturn could end up proving to be the bridge that institutions – on Wall Street and in Big Tech – needed to integrate crypto products at scale. Through M&A.

Copy-Paste Investing (Disclosures)

Biggest winner: Messari Stock (Series B)
Biggest loser: LUNA
Holds: BTC, ETH, $GBTC
Likes: BTC, ETH, ZEC, DePIN (FIL ⭐/AR), GRT ⭐, DeSoc, Tuck-in M&A
Biggest winner: Adding more ETH on the cheap
Biggest loser: CRV (-90%)
Likes: DePIN, taking the long view
Biggest winner: American dollars (0%)
Biggest loser: ETH (-70%)
Likes: Cash/USDC until late Q2 as the FED pauses, liquidity conditions improve and we hit peak recession, then up only for all risk assets for the rest of 2023.
Themes: TIPIN/PoPW, market capture > token cash flow, continued ETH dom- inance, the flippening in late 2023, institutional/ nation state adoption of crypto in Q3/Q4, and undercollateralized lending.

Biggest winner:
Biggest loser: ETH
Likes: Ethereum's rollup ecosystem, zk tech, NFT tech applications outside of PFPs

Biggest winner: USDC +0.00%
Biggest loser: RGT (-99%)
Holds: USDC, ETH, Aave, Matic, Pendle
Likes: Social (familiar consumer use cases with crypto complexities abstracted away), Eth-centric rollup ecosystems, Decentralized rendering and compute, Fuel for the winter (cash and lots of it)

Biggest winner: Not being in Terra & FTX (+∞%)
Biggest loser: TOKE (-95%)
Likes: ETH & BTC as bases for future network states, Ethereum core devs doing the Lord's work, Protocols as public goods / utilities (i.e., no rent extraction), Decentralized social combined with DeFi, TIPIN experiments (humble Pollen garden- er), SNARKs and oracles for cross-chain communi- cations, the friends we've made along the way.

Biggest winner: Knowledge, experience, conviction
Biggest loser: FTT (-100%)
Likes: Liquid staking protocols. Expect them to outperform ETH, which in turn outperforms BTC. Post the Merge, real yields for stakers are up to 6% from 0%; as soon as users return, they go up even more. With the right tokenomics, L2-coins could also have some potential.

Biggest winner: USDC (+0.00%)
Biggest loser: HNT (-94%)
Likes: Physical infrastructure protocols (also known as TIPIN, PoPW, EdgeFi) that provide real-world value and tap into existing, non-specu- lative demand. This includes DeWi, compute/ storage, energy, and sensor networks. Web2 adopting crypto infrastructure will bring on the next wave of crypto adoption.

Biggest winner: Surviving my first cycle above where I started it.
Biggest loser: ETH (-70%)
Likes: Solana: best tech without introducing cross-chain risks, TIPIN & decentralized computing networks, Gaming: The model worked with worse games, what happens when you use it with better games? Liquid staking derivatives: muh free yield.

Biggest winner: CHF
Biggest loser: ETH
Holds: BTC, ETH
Likes: Zero-knowledge proof applications, Infrastructure as the backbone of the next wave of crypto social applications, Dry powder

Biggest winner: Kayne Anderson Energy Infra- structure Fund [KYN] (+154.55%)
Biggest loser: GLMR (-80.62%)
Likes: Overweight LINK and FIL since 2023 will be the year of infrastructure protocols. DOT. Equities, crypto-adjacent equities, and real estate buys will be highly selective throughout 2023.

Biggest winner: USDC
Biggest loser: ETH
Holds: BTC, ETH, SOL
Likes: Boolish Ethereum ecosystem, ZK infra: namely for scaling + identity applications, Experimentation with emerging DAO governance frameworks, Lending w/ RWAs crucial in DeFi adoption

Biggest winner: Messari
Biggest loser: STEPN NFTs
Likes: SNX staking is my favorite position (must be managed). A rare utility token in DeFi. Sleeper pick is BNT, hoping they make a practical decision around tail risks even if the models don't call for it. AAVE adding GHO. dYdX punt for V4 success. ILV punt for gaming.

Biggest winner: XMR (–42.4% YTD)
Biggest loser: AKT (–89.5% YTD)
Likes: Utility-based Blockspace, Financialization of Blockspace (e.g., Consensus Capital Markets), Perps, 5-year (minimum) investment time horizons (YTD, crypto down; since buying first–fifteenth crypto, portfolio is up)

Biggest winner: BTC
Biggest loser: SOL
Likes: Undercollateralized lending/RWA, ZKP, and cash money
Biggest winner: USDC
Biggest loser: MOVR (-98%)
Holds: Aave, AKT, ETH, SYN
Likes: Cash in the near-term because of the FTX contagion; DeFi because of the FTX collapse; crypto infrastructure because of real utility; cross- chain infrastructure; ETH > BTC.

Biggest winner: USDC
Biggest loser: ETH
Likes: zkEVM rollups (airdrops + L2 staking opportunities), On-chain credentialing, Decentral- ized computing and storage, Holding cash

Biggest winner: XMR
Biggest loser: Endogenous collateral (Terra Luna, FTX)
Holds: ETH, XMR
Likes: Privacy (L1 fungibility, zk-zk rollups, mix- nets), Middleware/ Interoperability (ZK light clients, ZK bridges, oracles), TIPIN (storage, wire- less, compute), Modularity (Data Availability, L3s, zkEVMs), Ethereum Staking Ecosystem (Restaking, DVT, liquid staking)

Ryan C.
Biggest winner: GMX, UNIDX
Biggest loser: CRV, ETH
Likes: Perp protocols/Revenue generating proto- cols, All things Arbitrum DeFi, ETH and its L2s

Biggest winner: USDC, Mfers
Biggest loser: ETHE (-80%, thx for the protection gary)
Likes: Contrarian L1 plays (will be accumulating SOL), zk everything, liquid staking, and, most importantly, staying solvent

Biggest winner: US Dollar (+0%)
Biggest loser: BTC (-64.5%)
Likes: Liquid staking, Cosmos DeFi and for the time being, US Dollars

Biggest winner: US Dollar (+0%)
Biggest loser: ETH (~-70%)
Holds: ETH, USDC
Likes: Infra- LINK, 2023 is the year Sergey and Ari take off the training wheels, DeFi - FXS, Uniswap, AAVE all expanding product offering and poten- tial to eat market share from competitors

Biggest winner: US Dollar (+0%)
Biggest loser: Everyone with inflated valuations and egos
Holds: USDC, ETH
Likes: Crypto infrastructure with real applications
Biggest winner: USDC +0.00%
Biggest loser: ALCX -94.6% YTD
Likes: Boolish wallets as applications/superapps, USDC, Crypto Infra