by Franklin Bi and Kristie Huang, Nov 2020

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In early 2018, serial entrepreneur and longtime Maker community member Fernando Martinelli started exploring mathematical frameworks for DeFi liquidity protocols as a research project. Uniswap didn’t even exist at the time — Fernando was simply searching for a better way to provide liquidity on his own terms. Eventually, Nikolai Mushegian, original architect of the Maker/Dai contract system, and Mike McDonald, creator of, joined Fernando to actualize the idea.

Out of their efforts came Balancer.


A divided U.S. government — Democratic White House, Republican Senate — would likely result in more pressure on the Federal Reserve to expand their balance sheet. This money printing will inflate the price of things whose quantity cannot be “eased” — like gold, bitcoin, real assets, and even equities.

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It feels like bitcoin is going to melt up here.

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In last month’s investor letter we discussed that after 30 months of operation, Square’s Cash App is estimated to be buying around 40% of all newly-issued bitcoin.

PayPal just launched their new service that enables customers to buy, sell, and hold cryptocurrency directly from their PayPal accounts. …


PayPal recently announced they are launching a new service that enables customers to buy, sell, and hold cryptocurrency directly from their PayPal accounts. They are also planning to break into the crypto-payments sector by allowing users to fund purchases with crypto at PayPal’s 26 million merchants worldwide.

This is one of the biggest developments for the industry this year.

PayPal has 300 million active users. That’s 300 million people who will have a direct onramp to cryptocurrency in the coming weeks.

In aggregate across PayPal, Robinhood, and Cash App, that’s 350 million people who can instantly participate in crypto without having to go through a multi-day/week onboarding process for a crypto exchange. That was a major issue all throughout the 2017 bull market. …


There’s an old saying on Wall St. “Don’t fight the Fed.”

I’m inclined to go with that. Our core post-pandemic macro theme has been:

The unlimited printing of money will push up the price of things whose quantity cannot be eased.

Jay Powell, the Chair of the Federal Reserve, recently announced a major policy shift aimed at supporting the labor market and broader economy — by explicitly creating inflation.

“In conducting monetary policy, we will remain highly focused on fostering as strong a labor market as possible for the benefit of all Americans. …

“There are decades where nothing happens; and there are weeks where decades happen.”

— Vladimir Ilyich Lenin


We quoted that line last month — and, it just happened. The United States printed more money in June than in the first two centuries after its founding. Last month the U.S. budget deficit — $864 billion — was larger than the total debt incurred from 1776 through the end of 1979.

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For the sticklers out there with the knee-jerk counter-argument:

“Hey, you need to use constant dollars — take into account inflation!”

The answer is:

That’s EXACTLY why one should get out of paper money and into bitcoin. It isn’t being inflated away. One bitcoin is a constant fraction of the total 21 million that will ever exist. There is no need for inflation-adjusted numbers — because there is no inflation/hyper-inflation.

“There are decades where nothing happens; and there are weeks where decades happen.” — Vladimir Ilyich Lenin

Dear Investor,

We’ve seen unprecedented use of the word “unprecedented” lately. So, I will skip a listing of the unprecedented and interesting things that are happening and only focus on our core theme:

The unlimited printing of money will push up the price of things whose quantity cannot be eased.

As economists try to get their heads around the magnitude of this, there has been an escalating series of statements like “this deficit is the worst since 2008”, “…the worst since WWII”, “…since the Great Depression.” …

“The Times 03/Jan/2009 Chancellor on brink of second bailout for banks”

Thus began bitcoin.

Bitcoin was created in response to the previous financial crisis. Satoshi Nakamoto was concerned that governments were forever bailing out wealthy shareholders with printed money. Satoshi created a form of money that could not be debased. People all around the world could save their earnings in bitcoin without fear of their savings being diluted by excessive money printing.

Satoshi appended that bailout headline from The Times (of London) in the first block of bitcoin — the so-called genesis block.

The most famous sentence in the opening paragraph of Genesis is “Fiat lux” — Latin for “Let there be light”. Bitcoin has brought light into a confused world of debased paper currencies, fractional-reserve banking implosions, remittance companies charging migrants a month’s wages, fiscal policies that benefit wealthy special interest groups. When we look back in fifty years, I think bitcoin will be seen as one of the most positive contributions to the world’s population of our era. …

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Franklin Bi
Director of Platform

Welcome to the May 2020 edition of the Pantera Blockchain Blog!

Catch up with the Pantera community regularly as we share news announcements, job openings, industry trends, and interesting reads from the Pantera portfolio and the broader industry:

Over the past few months, we’ve been hyper-focused on helping our companies to tackle the new challenges they’re facing. Building a company is difficult enough in a normal world. Building a company in the middle of a global pandemic and uncertain macro environment can be extraordinarily hard. …

Paul Brodksy, Partner at Pantera

A fool and his money are lucky enough to get together in the first place.”

- Gordon Gekko, Wall Street¹

Gekko’s quote is great and obviously plays on the axiom that a fool and his money are soon parted. Maybe a more relevant way to think of this today is that people may soon part with their wealth if they focus on amassing the wrong money? Let’s discuss wealth and money and why sophisticated investors will soon distinguish among them.

Venezuelan stocks have risen almost 33% over the least two years, but the Venezuelan Bolivar — in which the stocks are denominated — has lost almost all its purchasing power.² If you were invested in Venezuelan stocks in April 2018, you “made money” but pretty much lost everything. Not one to speculate alongside corrupt political regimes? Okay, through April 30 the S&P 500 generated ten-year performance of better than 150% in dollar terms and a bit over 100% in gold terms. …

Dear Investors,

This is a really distressing, massively confusing time. I have no idea what’s going to happen in 99% of things right now. However, I strongly believe it’s close to inevitable that this will be very positive for cryptocurrency prices.

My kids used to count to 100, “One, two, skip a few, a hundred.” It feels like we’re doing that on Quantitative Easing. QE1, QE2, skip a few, a hundred.

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As Quantitative Easing approaches infinity, it simply has to have an impact on things whose quantity can’t be eased.

When governments increase the quantity of paper money, it takes more pieces of paper money to buy things that have fixed quantities, like stocks and real estate. They settle above where they would absent an increase in the amount of money. …


Pantera Capital

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