**Collect and own this episode as an NFT!

• 0.005 ETH mint, limited collection of 50 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

Dope Wars: Play to own NFT game. Submitted a proposal on the OP governance forum, requesting OP Funding.

• If you own a Hustler, Dope Wars has a multi-player map.

• Dope Wars started on Ethereum L1, and minted on L1.

• People have since migrated their Hustler’s and gear to Optimism L2.

• 25% of tokens are to incentivize users to bridge their Dope Wars NFT onto Optimism. This is good for Optimism as it could increase users moving onto the network.

• Also want to give OP tokens to users that have already bridged to L2 to pay people back for gas fees.

• Looking to distribute 25% of tokens to metaverse experience as rewards for playing games.

Optimism Statistics from Dune Analytics:

• Over 460,000 users / wallets that have used Optimism over time. This has more than doubled since April 2022.

• Over 10 ETH in daily transaction fees generated on Optimism. 113X times lower than you would be saving on Layer 1.

• Top 5 delegates on Optimism:

  1. Nick Tong

  2. Linda Xie

  3. Quixotic.io

  4. Polynya

  5. Synthetix Ambassador Council

• Big 4 layer 2 network bridgers ~ rough numbers

  1. zkSync: 332,000

  2. Arbitrum: 331,000

  3. Optimism: 216,000

  4. Starknet: 20,000

• OP token holders: around 89,000

What does it mean to be a delegate? Jrocki is now a delegate! You can delegate OP tokens to him - Jrocki.eth

• Keeping up with proposals and giving feedback on proposals in the governance forum.

• Voting happens on Snapshot. Users can see how delegates are voting on Snapshot. Tied back to ENS name / delegate name.

• They are on voting cycle 3 right now.

• The more tokens that a delegate has, the greater weight that a delegate’s vote has.

Espresso and Jrocki both agree that Optimism has a great brand.

Aside from the positive connotation of the name itself, the support for Public Goods funding and beyond positions Optimism well to be an influential player in the crypto space.

Upcoming NFT Projects and Mints:

• OP Bunnies still minting

• Silly Seals minting July 16th

  • Odysseus and Abraxas are both working on Silly Seals.

  • Odysseus (founder) brought on Abraxas as a Community Manager

• OptiChads end of month potentially

• Cryptovania story submission July 27th

OptiChads: Dicaso

• Chilling and Shilling

• Hurt his thumb, taking a break from art for a little

• Always use a VPN! Protect your computer

• Dicaso is doing the drawing himself, by hand using a tablet.

• Mint date: end of month maybe?

Why come to layer 2?

• How will we attract people to Optimism Layer 2?

• Is there a bit of a confirmation bias where we’re all involved in Optimism Layer 2 so we tend to support those prior beliefs about Optimism more heavily?

• Many of the projects that have minted out are either free or some sort of Ape derivative.

• We’re competing with Layer 1, where gas is pretty cheap right now during the bear market.

• Many of our consumers tend to expect free mints

Web3Mark from Quixotic:

• The NFT bridge from Quixotic will merge into the Optimism codebase.

• They are being risk-averse and doing an audit for the bridge starting July 18th.

• In mid-August, they want to launch support for bridging L1 NFTs on Quixotic.

• You will be able to list on L1, but when you buy it, it will transfer to L2 in one single transaction with cheaper gas.

• Works similar to any standard ERC-20 bridge with an escrow system.

• They use the Layer 0 Oracle to send the message to Layer 1 requesting the NFT.

• Filters and stuff will work the same.

• Also working on batch transactions, where you can purchase multiple NFTs in one transaction.

• Could it be that Optimism and Layer 2 are a bit of a different use case than Layer 1?

• Perhaps gaming or some other use cases will be the adoption points of Layer 2 because of cheaper fees

• Reputation and governance NFTs: POAPs have been super successful on Gnosis chain (sidechain to Ethereum)

• They want to make it easier to issue badges for achievements.

• They are moving their marketplace contract to use SeaPort, which is OpenSea’s marketplace exchange contract, and it is audited.

• Quixotic has implemented direct fiat on-ramps for the marketplace, and always trying to add more.

• If gas fees explode again on Layer 1, then Layer 2 is really well positioned for people who are into NFTs and want to keep it affordable.

• We only need 4% listed on any given collection to have as much liquidity as on OpenSea.

• Quixotic’s main goal is to help communities move from Layer 1 to Layer 2 and embrace scaling.

Outreach to L1:

• Why are L1’s not exploring Optimism?

• A lot of L1 projects just are not aware of Quixotic.

Binji from Optimism OP Labs joined us on the Space!

• Huge fan of the energy

• Speaks to new projects every day.

• OP Labs members are out here to support us.

• Once NFTs become ubiquitous, then the gas fees really matter. Think concert tickets, for example

• “It's all community. It's built up by people like us. You want to be into NFTs with friends.

Is it for the art, or is it for the utility?

Many of us agree, these Twitter spaces are a highlight of the week.

All of the podcasts become NFTs.

Cryptovania: a fan fiction site where you can write and vote on stories.

• Distraction Boy with OP Bunnies dropped 2 NFTs for each minted bunnies. 1 to 1 for Bunnies and Pixelated bunnies. 1 to 1 wallet for citizens… and that’s not the end of it yet! OP Bunnies are still minting, holding the record for the longest running mint on Optimism.

• Dicaso sacrificed (burned) 33 humans to get 4 vampires in Cryptovania. He wrote the Saga of Bonquisha.

• Abraxas paid 0.6 eth for his Cryptovanian peasant vampire. This is the top Cryptovania purchase ever so far. Abraxas also wrote his Cryptovania story in a rhyming / poetic way.

• If you get the most upvotes for your story, there is a 0.2 ETH reward.

Abraxas shares his story of getting liquidated:

• Last fall, Abraxas migrated from Layer 1 to Polygon then over to Fantom.

• Lost money by depositing all of his ETH on polygon into Chee-Dao (spelling?) in MAI token.

• Lost > $10,000 worth of coins. Value dropped 90%, while ETH is dropping as well. Lost ETH too.

• Dicaso put 200K into pickle.finance, and locked it for 4 years.

Abraxas on Aggregation theory:

• Ben Thompson coined the term “Aggregation Theory”.

• Companies have ability to both aggregate the product as well as the consumer.

• One of a big challenge for web3 is to compete with these large companies like Google that are big aggregators.

• This is difficult to compete with. The real product is people.

• Google and Twitter has aggregated the majority of people / majority of the internet.

• How will blockchain fit into these existing large players in the market?

• Etherscan feels like the Google of web3, where Etherscan indexes every transaction on the Ethereum Blockchain.

• Can we build the future with Retroactive Public Goods Funding?

Cryptoglyphics:

• Launching a music-related project on Algorand

• Algorand is unique because it is enabling people to opt-out of getting airdropped NFTs. You don’t have to worry about people pushing things to your wallet if you don’t want them to.

• Cryptoglyphics mentioned taking independent music venues and moving them to more decentralized places, giving them a communal voice for them to have leverage.

• The lead architect of ADA just became the CTO of Algorand.

**Collect and own this episode as an NFT!

• 0.01 ETH mint, limited collection of 10 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

https://podcasts.apple.com/us/podcast/9-optimism-nft-vibes-w-jrocki-abraxas-distractionboy/id1626927963?i=1000569867015

https://open.spotify.com/episode/5H6PrRiVhvgSrGyKhnhmSB

Show Notes:

coming soon

**Collect and own this episode as an NFT!

• 0.01 ETH mint, limited collection of 10 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

https://podcasts.apple.com/us/podcast/8-optichads-nft-founder-and-alien-optipunk-holder-dicaso/id1626927963?i=1000568212963

https://open.spotify.com/episode/4DYUcS6G9EO06N6Kzp4QR9

Show Notes:

coming soon

7th Weekly Twitter Space covering the Optimism ecosystem.

**Collect and own this episode as an NFT!

• 0.01 ETH mint, limited collection of 10 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

https://podcasts.apple.com/us/podcast/7-sunflower-land-adam-hannigan/id1626927963?i=1000568208813

https://open.spotify.com/episode/7mODQfsn9O4PdmA2MBQUEQ

Show Notes:

coming soon

**Collect and own this episode as an NFT!

• 0.01 ETH mint, limited collection of 10 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

https://podcasts.apple.com/us/podcast/5-%2496m-crypto-fund-biotech-daos-nft-drop-ft-jpegmogul/id1626927963?i=1000566574994

https://open.spotify.com/episode/4m81OtJZJuvpALFhKOcf1H

Show Notes:

coming soon

**Collect and own this episode as an NFT!

• 0.01 ETH mint, limited collection of 10 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

https://podcasts.apple.com/us/podcast/4-putty-nft-options-w-tam-hop-protocol-soulbound-%24op-l2-stats/id1626927963?i=1000564800534

https://open.spotify.com/episode/7xLPeGYhosSaLRqXX97wdM

Show Notes:

Featured Guest: Tam from Putty

Tam’s mission is to bring more financial sophistication to the NFT space by building an open-marketplace for ERC-20 and ERC-721 put and call options.

Jrocki read white paper and was one of the first in the discord

Putty and Cally - Overview

Putty is an options platform where you can buy and sell put options on NFTs and ERC 20 tokens.

Putty enables you to hedge your risk and protect your downside for floor price dropping or token price dropping.

For example, if you have an NFT worth 1 eth, and are worried the price might drop, you could buy a put option for a small premium at a strike price of .5 eth for say 1 month.

If the price of the NFT goes below 0.5 eth at any time during the next month, you could exercise that option, and get 0.5 eth from whoever sold the option to you.

Cally is also an options market, but for call options instead of puts.

Cally enables you to sell covered calls on your NFTs by setting a specific duration and premium.

Users can seek to earn a premium on NFT by staking it in a vault and selling a call on it.

Calls can be set based on a dutch auction.

If you set the parameters correctly, you can try to ensure the other side of trade is far out of the money, so you can kind of earn yield. Its a way to avoid being liquidated on your NFTs, although there is still risk.

• Putty and Cally have done 50,000 worth of transactions.

• FloorDAO sold a bunch of puts to another organization that was wanting to protect themselves on the forgotten runes wizard cult NFT collection.

• Launched in January and built in the Solidity programming language, Putty and Cally will both be on Ethereum mainnet and Optimism, although currently MVP stage.

• Putty and Cally were released testnet early in the development cycle - no gated or whitelist testnet required. Tam has appreciated users of the testnet version providing feedback and battle testing.

• If you want to do something specific with Optimism tokens, reach out to Tam or jump in the Putty discord. They can help you find agreeable terms.

Putty Version 2:

They are developing specifications for version 2.

V2 of Putty will implement a model based on the Black-Scholes options pricing model, a mathematical method (using differential equations) to calculate the theoretical value of an option contract.

The Black-Scholes model requires 5 inputs. These factors determine a user’s likelihood of turning a profit:

• strike price of an option

• current stock (or token) price

• time to expiration (duration)

• risk-free rate

• volatility of the token of NFT collection

What can you do with Putty and Cally?

An options protocol for ERC-20s and ERC-721 tokens will enable structured financial products to be built on top of these crypto assets, enabling retail crypto investors to access ERC-20 and ERC-721 based derivatives.

This will ultimately broaden and diversify the type of financial portfolio that can be built in the realm of cryptocurrency.

For example, a user could create a generic floor NFT option.

On top of an option based on the floor price of an NFT, you could create an NFT index that tracks the prices of a group of different NFT collections.

Imagine building an NFT based index fund that tracks the floor price of a set of blue-chip NFTs on mainnet - such as Crypto Punks, Bored Ape Yacht Club, Xcopy, and Doodles.

Another use case for Putty is in GameFI, where users taking damage or health los. Loss of health impacts the price of the NFT when they go to sell it. To mitigate downside risk of damaging your in-game NFT, the user could buy a put option on the NFT before they engage in the task that can damage the price of the NFT. This is a way to hedge potential risk.

A lot of Runescape players got interested in GameFI by way of selling characters and gold online. If we create Runescape on top of a blockchain, it could be a huge use case.

Tam is also stacking optipunks ahead of the OP airdrop

Quick takes from Jrocki and Espresso

Soul bound NFTs: non-transferable and non-traceable.

• ID cards, certificates of completion, building credibility

• being non-tradeable, soulbound tokens are not getting the attention they deserve.

• soulbound NFTs could facilitate uncollateralized loans, enabling people to building credibility ( similar to how a credit score is used by financial institutions to assess the risk of taking on an individual customer )

Optimism stats:

• gas is 95X cheaper on Optimism than Ethereum mainnet

• Optimism gas was between 18-32 cents over the last week

• 60,000 transactions per day, doubled in less than a year.

• 200,000 unique users per day

• OP token soon (had not launched yet)

• 248,000 eligible wallet addresses for the OP airdrop

Hop Protocol

• HOP proposal allocated 1 million OP tokens to subsidize bridging costs for users.

• every user that onboards using hop will have those fees paid back to them.

• interaction with HOP protocol will enable you to earn OP rewards.

Cryptovania mint - Quixotic created a direct fiat on-ramp to the website.

**Collect and own this episode as an NFT!

• 0.005 ETH mint, limited collection of 10 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

https://podcasts.apple.com/us/podcast/3-dragonia-cryptovania-silly-seals-lyra-lens-protocol/id1626927963?i=1000564795680

https://open.spotify.com/episode/3Ga9OV9xxrSMn2iaI4Iksk?si=Srsspj6iTWWfeK9wnkYlzA

Show Notes

Key Takeaways:

• Optimism is decentralizing, taking token live, OP will give out OP tokens for people building public goods on optimism.

• Lens Protocol is the next iteration of decentralized social media.

• “NFTs have never really made sense to me, you need utility, it needs to do something”

• The younger generation will understand crypto. This will be the generation not talking about it, but using it. And it will be embedded in everything.

• Stories (via Cryptovania) could be a positive externality for the world.

• Talent: The people who really know what they’re doing are going to be working on the most decentralized, secure, and strong places. During the next cycle, when the masses of people come back to the crypto space, the usable applications will be on the strongest chains because the developers have built things here.

• People don’t care about security from a marketing standpoint, but if you’re selling someone something, you better make sure that you are being secure with how you store their data.

• You are not a customer, you are a sovereign individual entity.

• Web2 is what you use, web3 is what you own.

• Decentralization is a must, anonymity is a choice.

Intros:

Abraxas, Jrocki, and Espresso kick off the call talking surfing, nomad life, travel, building roots, and more.

Vision: cover the user side of web3 and various dapps and users coming onboard to the blockchain space.

Quick Takes:

• Opportunities in public goods funding. Optimism is decentralizing, taking token live, OP will give out OP tokens for people building public goods on optimism.

• OP wants to give out their token to people who are building things. You need to submit a proposal. The token house votes on the proposals to approve or deny is.

Lyra protocol (options protocol on Optimism) submitted a proposal to give tokens to builders, liquidity providers, and traders.

• A portion will go to non-technical things such as education, podcasts, newsletters, educational videos, etc.

• Liquidity providers - providing liquidity to the protocol Lyra, for traders, so that users can trade for free.

• 10% of these will be retroactive funding, for anyone who has built things on top of lyra or supported lyra in some way.

• Opportunities for both technical as well as non-technical users.

Lens Protocol: Lens is the next iteration of decentralized social media.

• Lens is the first attempt that looks very promising “user owned content and social relationships”

• With Lens, you can own your own data.

• Whereas on Facebook or Twitter, they own your data and the ad revenue.

• Decentralized social media gives creators the ability to monetize and participate in revenue sharing.

• Unfortunately Lens is still in private launch, hoping for a public launch soon.

• Follow espresso.lens.

Abraxas: Teacher, formerly a coordinator for adult literacy. Involved in both teaching as well as web3 projects.

• Cares about education, equality, and how a lack of education can limit opportunities.

• Got into public education with a master’s degree.

• Took out retirement funds and started investing.

• Heard about “Invest like the Best” with Patrick O’Shaunessy.

• Listened to Justin Drake’s episode on this podcast, and went down the rabbit hole of crypto.

• Setup a Metamask wallet after experimenting with centralized exchanges.

• Came over to Optimism last summer.

• Was still pretty expensive last summer

• Got into Polygon, and things like Fantom. Ended up losing some money

• The OP token launch sparked his interest as well

• Loved the idea of democratizing access to financial tools.

• Wanted to find a reason to be involved, which for Abraxas, was public goods funding initiatives.

• “NFTs have never really made sense to me, you need utility, it needs to do something”

• The quickest way to get involved was to buy or mint something.

• Got involved with Dragonia project on Optimism. Crowley from the Dragonia team likes Abraxas’s participation on Discord, and asked him to be a community manager.

• As a teacher, do you ask your students about web3?

  • A little bit, but Roblox: every kid plays roblox.

  • It is a game as well as a social network, where you can talk to friends etc.

  • The younger generation will understand crypto. This will be the generation not talking about it, but using it. And it will be embedded in everything.

  • You could in theory take your roblox skin and go play Fortnite, for example.

  • This is probably how games will look in the future.. like Metaverses.

• Dragonia is an entire ecosystem.

  • The trainers are the focus and the utility.

  • Like a less complex magic the gathering game, similar to rock paper scissors.

  • There will be 9999 3 different rarities, give you access to the whole ecosystem, play to earn.

  • Trainer NFTs allow you to earn passive income.

  • Portions of the fees are distributed to holders.

  • You earn experience which can be exchanged for rewards.

  • Also whitelist spots on partner projects.

  • Wen mint? June timeframe.

  • All earnings will be distributed in ETH.

  • People can use their trainer to vote for changes.

  • Abraxas also spent time explaining how the game works. Portion will go to public goods.

Odysseus: Soon to drop a collection on Optimism, Silly Seals.

• A portion goes to public goods.

• Odysseus is a budding dev, working with a web2 company now.

• Using solidity for the NFT project, and also Synthetix

• Why layer 2, why Optimism?

  • As a synthetix guy, he is very committed to decentralization.

  • Loves the Optimism vision for things like public goods and paying teachers what they are worth for example.

• What is synthetix? It is a protocol that provides a pool of capital for things like trades.

  • Dividends are paid out based on profits to stakers.

Fractal Visions: Runs a fine art printing business on canvas.

• Got into the NFT space in the last year and a half.

• Sold 3 pieces for an artist with health troubles in Peru on Rarible for 1 eth each.

• The NFT space has been empowering for artists.

• Enrolled in a Dapp university course to learn.

• Loves the Quixotic vision and the digital revolution of art that NFTs is creating.

• So many people in the real world who collect art are still not a part of the NFT space yet.

• Runs the Ganland NFT projects.

• Artists should be paid for their work.

Cryptovania: Lexx and Mark

• Giving away mint passes

• Today, metaverses are centrally developed, hard to deliver on, and hard to access.

• They are building a “Storyverse” with Cryptovania

• Cryptovania is an NFT project centered around storytelling.

• Stored on IPFS, which is decentralized. Plain text stories.

• Stories could be a positive externality for the world.

• Cryptovania is a return to the fundamentals of storytelling.

• Bottom-up approach: You could build an entire metaverse around these stories in the future.

• Proceeds from the mint will go towards a bounty system, where whoever has the most upvoted stories will be paid for writing a good story.

Why web3?

• The value does not accrue back to people in the communities.

• Impact = Profit, in theory on Optimism.

• If you write a good story, you can benefit from that In web1 and web2, the only people who benefitted were those with a really big following.

• There was not a lot of value accrual back to the creator.

• Quixotic is also working on an NFT bridge.

• Badge style NFTs: things earned rather than bought. Transferable or non-transferrable. Dark Forest issued friendship cards, for example.

Why Optimism? Why not fantom or avalanche where gas fees are lower?

• Other chains don’t scale as well.

• On high usage, fees still go high.

• A lot of volume could crash the network.

• Optimism is more robust, you won’t have that problem because it inherits its security and uptime from Ethereum.

• Over time, talent is the only thing that will survive. The people who are really invested in the space and know what they’re doing are going to be working on the most decentralized, secure, and strong places like Optimism or Arbitrum or Ethereum. So during the next cycle, when the masses of people come back to the crypto space, the usable applications will be on the strongest chains because the developers have built things here.

• You don’t care about security until you need it, and then you care about it a whole lot.

• Terra ecosystem did not thing about this until it was too late, for example.

• As more crazy stuff happens, some of these alternative layer 1’s could have similar token or security concerns.

• On Optimism, as more people trade, it gets cheaper because they can compress the date on each block more effectively.

• Decentralization is an important pre-requisite for blockchain. Instead of decentralization, we can use the word “security”.

• Layer 2’s share security fundamentals with Ethereum.

• Decentralization and Security will never be big selling points from a consumer perspective, although it is extremely important.

• People don’t care about security from a marketing standpoint, but if you’re selling someone something, you better make sure that you are being secure with how you store their data.

• You are not a customer, you are a sovereign individual entity.

• Web2 is what you use, web3 is what you own.

• Decentralization is a must, anonymity is a choice.

• 1 token 1 vote - positives and negatives about this. We want to be careful about power games.

**Collect and own this episode as an NFT!

• 0.005 ETH mint, limited collection of 10 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

https://podcasts.apple.com/us/podcast/2-quixotic-nft-marketplace-optimistic-ape-giveaway/id1626927963?i=1000564612420

https://open.spotify.com/episode/2CVmRgSrvxXNvfyXlPsYp5

Crypto is how you program money. Money is how you program people.

Why would a developer want to build on Optimism?

The answer is incentives.

"Incentives motivate behavior."

The ecosystem needs developers to actually BUILD DAPPS on Optimism.

Why should a developer want to use Optimism as opposed to any other blockchain network?

Incentives to build on Optimism: the “Optimism Governance Fund” donates money to teams and projects that have built useful things for the community.

These useful projects are known as “public goods”.

The idea here is to reward those that contribute in positive ways.. incentivizing new developers to launch their dapps on Optimism.

• Public Goods make people want to join an ecosystem. Science is and example of a public good that is valuable to society.

• With retroactive public goods, whatever turns out to be the most valuable tends to be retroactively rewarded after proving its product-market fit. This is the opposite of traditional venture capital firms that go out to fund a bunch of different ideas without knowing for sure what will succeed.

Why Did You Get into into Optimism Ecosystem??

***jrocki.eth ***- Twitter Spaces Co-host. supported Optimism during OptiPunks launch because of Public Goods Funding Infrastructure.

Mark, Co-Founder of Quixotic.io:

Mark was a software engineer at an ad-tech company. Later learned about ETH, Optimism, and the possibility to host projects on IPFS.

• Participated in ETH global hackathon in 2021… involved with Feudals Ethereum community… worked on some various developments in Ethereum.

• Looked at other Layer 1’s, saw the high cost of trading NFTs on L2. Saw Layer 2’s as the future. Wanted to build something and make something happen in the space.

• Build / launch Quixotic.io

• Currently building CryptoVania / Storyverse on IPFS

On Building + Dapps in the Optimistic Rollup space:

Even though the markets are down it feels like the builders are full-steam ahead.

On the Space, Mark raised the question: what do users need for adoption to increase?

One specific need was brought up: we need a decentralized app store / decentralized app platform.

• For example, you don’t see substack app on the App Store. Why not? Because App Stores take too big of a cut due to policies around in app purchases etc. Effectively creates a roughly 30% markup on everything.

• Browser apps are harder to block and shut down, however, performance and computation are more difficult in browser.

• Huge opportunity for decentralized apps.

IPFS - communication and naming protocol. Similar to bittorrent, everyone can access files on IPFS thru peer to peer network.

• With Brave Browser you can visit IPFS, similar to using http.

• If no one is pinning the file, it might be really slow. So, you can pay someone in Filecoin or Pinata to pay the network to access the file, if no one pins it.

Warp speed bridge - standard protocol level bridge for optimism…Eth in escrow / burns the eth etc. Came out of a project called teleportal.

Storj - startup for decentralized storage. They encrypt your file.. many copies of the data in little chunks. Users of dropbox could move to something like this - around $7 per month for $1 TB.

He is the author of the book Defi and the Future of Finance, to which Vitalik Buterin wrote the Preface and Fred Ehrsam the Foreward.

He has published papers on finance, crypto, and beyond. His most recent, An Investor’s Guide to Crypto, is available on SSRN, published June 2022.

**Collect and own this episode as an NFT!

• 0.01 ETH mint, limited collection of 111 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

https://podcasts.apple.com/us/podcast/dr-campbell-harvey-defi-and-the-future-of-finance/id1626927963?i=1000569243760

https://open.spotify.com/episode/7xI6KHIoZCQIekC8S14WEO?si=2SrWFPjwSUCEaqtV_-4VzQ

I highly recommend checking out Dr. Campbell Harvey’s course, book, and paper, linked below.

Decentralized Finance, via Coursera:

https://www.coursera.org/specializations/decentralized-finance-duke

DeFi and the Future of Finance, the book.

I read the book and specifically enjoyed the coverage of many concepts we often hear about, yet might not have as good of a true understanding as we’d like (burn, mint, bonding curve, consensus mechanisms, portability, oracles, and more).

I also enjoyed learning about five of the biggest problems within centralized finance, which DeFi can help solve. The implications in solving these problems are huge - for both equality of opportunity as well as economic growth.

https://www.amazon.com/DeFi-Future-Finance-Campbell-Harvey/dp/1119836018/ref=sr_1_3

An Investor’s Guide to Crypto, published on SSRN: in the show, he mentions footnote 4, which includes selected projects from 20 different areas in the blockchain space, such as layer 1, layer 2, defi, privacy, NFTs, gaming, metaverse, social networks, identity, bridges, etc.

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4124576

Show Notes, Key Takeaways:

• “We’re right at the beginning of this disruption”.

• On Satoshi Nakamoto’s 2008 Bitcoin Whitepaper: “Its the sort of paper that potentially changes the way things work in the world.”

• A statement made by a student who took his course: “Over the past couple of years I’m in so many conversations where people are talking about crypto, and I was just a wallflower. But after your course, I’m in the mix. I can ask questions, and I can ask good questions.”

• “Being able to see-through the incorrect and mistaken statements that we so often hear is important.”

• “What you should look at is not the price of the crypto, but the interests of the venture capitalists. And they love it right now.”

• “We need to look beyond the price movement, and figure out what problems exist, and figure out if the technology can solve the problem, while maintaining a realistic time-frame.”

• “You don’t need a degree in computer science. What you need is to be creative - to identify problems that could be solved with this space, and just jump in.”

Intros:

Dr. Campbell Harvey has been in the space since 2013. He was formerly editor of Journal of Finance.

When he got back into teaching the international finance course he thought it would be valuable to add a section on bitcoin.

He read the Satoshi white paper, and realized it was a foundational idea.

It was a vary niche idea in 2013.

He was surprised it was not published in one of the top journals – it was the type of paper that every academic strives to have. “Its the sort of paper that potentially changes the way things work in the world.”

Creating a course on crypto at Duke

Decides to devote a lecture to cryptocurrency.

Enlists a colleague (who turned out to be an undergrad student) from the University of North Carolina at Chapel Hill to help with preparing for the blockchain topics and cryptocurrency course.

The student, as a bitcoin developer, goes on to finish at Duke in 3 years, later joining startup in Silicon Valley. (The story as told in the episode is really worth a listen!)

Professor Harvey delivers his lecture on crypto and blockchain, and the students end up staying late after class, sharing the transformational impact that the lecture had.

That single lecture evolved into a course at Duke, as well as four courses on Coursera in Decentralized Finance. The book is based on the course.

Nowadays, he teaches less on traditional finance and more decentralized finance.

After taking his courses, one student expressed: “Over the past couple of years I’m in so many conversations where people are talking about crypto, and I was just a wallflower. But after your course, I’m in the mix. I can ask questions, and I can ask good questions…”

Risk

Half of the book is about risk.

You need to understand the risks. Finance is not only about expected returns, but about assessing the risks.

The material for Innovation and Cryptoventures changes so quickly -- every semester there is new material due to the fast paced nature of the crypto industry.

Blockchain Conference assignment

One semester, an assignment for the course was to attend a blockchain conference, and make note of false statement that so-called expert panelists say.

This assignment highlighted the importance of being able to determine if someone thinks they know something but they don’t really know.

Being able to see-through the incorrect and mistaken statements that we so often hear is important.

Co-authors of the book are former teaching assistants of the course.

“We’re right at the beginning of this disruption”

Recent paper, Investor’s Guide to Crypto was published in June 2022 on SSRN.

In traditional finance, if you don’t like the volatility, you can take a diversify between risky assets and stable assets. Similar principles can be applied to crypto.

Volatility should be expected in these markets.

It is a mistake to look at only bitcoin and ether.

See footnote 4 in the paper, which sketches 20 different areas in the blockchain space, such as layer 1, layer 2, defi, privacy, NFTs, gaming, metaverse, social networks, identity, bridges, etc.

The basic lessons of diversification should be taken into account.

There are a few sections on active strategies.

The paper also debunks a few valuation models - for example, coupling the valuation of bitcoin to the value of gold metal.

In 2019-2020, based on the number of Coinbase and Robinhood wallets, the number of speculators in the space increased.

Risk-on vs. Risk-off investments

• Risk-off assets: People buy safer assets like US Treasury Bonds.

• Risk-on assets: once we had a vaccine, people tended to get back into risky assets.

• Risk-on assets tend to be dumped during tumultuous times, such as March 2020 when COVID hit. The stock market dipped 35%, bitcoin dropped 55%.

Custody:

If you lose your private keys, you lose your crypto. This is a risk management challenge for people.

Fidelity and Coinbase Pro are entering into the custodial space. This increases the ability for institutional investors to enter the space.

Regulatory:

ETFs, however, have faced regulatory challenges.

Dr. Harvey has written twice to the SEC suggesting the approval of ETFs.

We don’t have a lot of regulatory guidance today. It is hilarious to think that crypto fits into the securities act of 1933. If you’re a security, you need a transfer agent, which is an algorithm in DeFi. Regulators don’t have an easy job.

If we impose regulations that are too harsh, then innovations go off-shore. If regulation is too lax, then people will be taken advantage of.

It is difficult to find a middle ground. It takes a lot of time.

We should have a safe harbor period.

Broad potentials of blockchain

1.7 billion people in the world are unbanked.

In web3, your bank is your smartphone. No transferring money from banks - you simply link your wallet.

There is no web3 without decentralized finance. You can pay for stuff, but you can also be paid.

This technology offers the promise of making the economy much more efficient.

Bankers tend to prefer to deal with larger customers, and give larger customers the best deals.

Smaller projects are thus more difficult to start-up today with traditional financing.

If we can solve this problem, we can increase investment, increase growth, and real GDP.

We eventually need to pay down our debt - the answer is growth.

We can bump growth between 5-8%.

“What you should look at is not the price of the crypto, but the interests of the venture capitalists. And they love it right now”.

Dapps and Web3 Wallets

Dapps are different - whereas something like twitter is a centralized app, something like Metamask is opensource and you can see the code on Github.

You can’t do DeFi without a decentralized app.

NFTs class:

Professor Harvey teaches a lecture on NFTs.

Prices are likely to go down on digital art.

The class on NFTs focuses on applications of NFTs that will be important in the future.

The NFT monetization model seems to be much more beneficial to artists than for traditional model with galleries.

All students have a Metamask wallet.

Students in the class create NFTs. For example: Campbell Harvey teaching how to create an NFT

There is a class token, and they get rewards for doing certain things, like asking good questions of suggesting a change in wording.

Students get a reward for visiting the Bitcoin and Ethereum mining operation at Duke. Students take a selfie in front of the miners, and post that selfie as an NFT as proof that they were there… Proof of Attendance.

Use cases for NFTs:

• Augmented Reality fashion - all the big fashion houses have NFT initiatives. At London Fashion week there was a half day on digital fashion.

  • Beyond this, the metaverse is a huge future application of NFTs.

• POAPs / certificates of completion, proof of attendance.

• Ticketing and artist / fan interaction. Fans could buy tickets, songs, or merch directly from the artist. An NFT from a show or concert could form a small community among fans. Direct interaction between community and artist.

• Identity: Eventually, you won’t need credit cards and debit cards - it could all be linked to the identity NFT.

  • University degrees, for example, would have to be non-transferrable. Its easy track on-chain if someone purchased a university degree or if it is counterfeit.

We need to look beyond the price movement, and figure out what problems exist, and figure out can the technology solve the problem, while maintaining a realistic time-frame.

Web 1, 2, and 3

• Web1: a way to access information. Only a way to consume content.

• Web2: social. Creating community like Twitter, Facebook, etc.

• Web3: the ability to transfer value. People who designed the initial browsers thought we would have digital currency, but they failed. Blockchain solves the double spend problem and makes it possible.

Crypto cycles and the internet bubble - we’re early

Even during and after the crash of the internet bubble, the internet didn’t go away. The strong firms remain. We can expect similar situations across cryptocurrency bull-bear cycles.

There will be spectacular failures, and spectacular successes.

The key thing is that we’re early. And its always an advantage to be there at this point where it’s really early.

Traditional financial institutions will likely be doing much smaller things.

You need to be the disruptor, not the disrupted. This space offers a lot of potential to be the disruptor.

You don’t need a degree in computer science. What you need is to be creative - to identify problems that could be solved with this space, and just jump in.

**Collect and own this episode as an NFT!

• 0.0025 ETH mint, limited collection of 10 NFTs.

• Proceeds are re-invested to grow the podcast and expand crypto education.

Listen to the Recording:

https://podcasts.apple.com/us/podcast/1-nfts-on-optimism-optipunks-public-goods-funding-market/id1626927963?i=1000564612640

https://open.spotify.com/episode/6KzVFpIoxUNoyABQNpwopM

Overview: NFT Projects on Optimism:

• Optipunks: original NFT on optimism. 100% of mint went to public goods funding. 50% of secondary went to public goods. Royalties on secondary is 2.5%...

• the OptiPunks community voted to decide which project funds would go towards.

• Optimistic Apes: Another project available on Quixotic... Sounded like a lot of us on the call minted or purchased some. The artist is still a mystery!

• Circular art, generative art platform designed to fund public goods

What are public goods?

• Examples of public goods include libraries, roads, open-source software (like ether.js).

• Paid for by the community (funded thru taxes, for example)

• Benefit everyone using the ecosystem.

• "retroactive public goods funding" - if people did something positive, community can vote to allocate money / rewards for building useful things.

• Public goods solve the market inequality of positive externalities.

Join us every Monday at 4pm PST / 7pm EST on Twitter. Hosted by Jrocki (@Reformed_Normie) and Espresso (@Espressoinsight).