A Conversation With Tushar Jain

USV is an investor in Multicoin Capital, one of the leading token funds. In late October I attended their Multicoin Summit and spent about 45mins on stage with Tushar Jain, one of the two managing partners at Multicoin.

It’s a pretty good wide ranging conversation about how we think about investing in crypto right now (although it is a couple months old now).


Comments (Archived):

  1. jason wright

    Tentacles. When has innovation ever been achieved through a process of ease and convenience? I’m speaking of the horror of ERC20. It’s sent far too many people down the same dark alley where they have huddled together for mutually assured survival in a dodgy neighbourhood.

  2. LIAD

    Did you see how that twitter thread developed last night about Vitalik got involved?

    1. fredwilson

      yes, but i could not follow that thread. i don’t get most of the crypto folks.

      1. LIAD

        I didn’t follow tweet by tweet. Just saw Vit handing out hundreds of 000s of USD to eth projects in real-time throughout the thread.Quantitive Easing Crypto Style.

        1. kenberger

          hilarious because his twitter handle has long said, “non-giver of ETH”

          1. jason wright

            Olympic, Frontier, Homestead, Metropolis, Serenity,… Damascus?

        2. jason wright

          m is for management. got a problem? throw money at it. sure.

      2. LE

        i don’t get most of the crypto folksThis is standard nerd playbook. Speak and/or invent different language to keep the newbies out. Part of that is the aspergers (ie ‘ass burgers’) and part is intentional so they are needed to decode. How they control and get their revenge. [1] Also how (per early Microsoft) how they are able to create a complete eco system of helpers and translators who profit and keep them in power.[1] You think I am joking but I am not joking. Note how Liad couldn’t even post a link to what he is talking about (for the rest of us) just secret handshake ‘did you see how that twitter thread developed’ as if everyone should just know what he is taking about.

      3. kidmercury

        that would be a fun statement to unpack. did you find you did not get any of the web 1.0 folks back in the early 90s, did you back any of those, how were outcomes, etc. some of these crypto folks that i don’t quite get remind me a bit of richard stallman, in that they probably have some great insights and technical brilliance but they have not yet found a way to make it something most folks can relate to. or another person they remind me of is the guitarist buckethead, absolutely brilliant musician technically, but he’s so weird personally and his music is so weird i don’t know how anyone gets it, lol.

  3. Adam Sher

    At ~11:40 the Tushar claims there is long-term clarity of what the use cases will be and how the stuff will be used. Maybe it’s because I’m not active in this space, and the audience is already in on it, but I don’t see the evidence for that statement at all. That would have been a good place to dig in there and examine what is clear or what those use cases are.I found out about a use case that I chuckled at. Vanguard is using a block chain platform to mask when it initiates some trades to avoid HFT front-running.

    1. Tushar Jain

      I think the use cases around: (1) digital gold not controlled by a government, (2) open finance which allows anyone in the world to participate, and (3) non fungible tokens is pretty clear.It’s *crazy* to me that a middle class person in India or Brazil in 2018 can’t easily buy Apple stock (or a derivative that closely tracks AAPL). It’s crazy to me that we can’t currently control scalping for concert tickets, in the future non fungible tokens would solve this easily.That’s just the lowest hanging fruit.

      1. Adam Sher

        Thanks for replying, Tushar! digital gold not controlled by a government It is not obvious to me that this is new or important. Non-government currencies exist in forms that don’t scale and maybe scale is the differentiating variable that makes block-chain based currencies better. For example there are MMORPG’s I used to play had large enough user bases where game gold to USD exchanges existed. The exchange rates exhibited similar patterns to BTC as people wanted to participate more in the in-game economy, and then crashed and stabilized when the “gold rush” ended. Another major limitation of in-game currency is that you have to buy stuff related to the game, which is similar to the problem of issuing tokens on a specific block chain. Now that in-app purchasing is so easy, is there a need for additional currencies?Generalizing this experience (foolishly?) to crypto-currencies, do you envision an oligopoly of crypto-currencies or many micro-currencies and people would be able to cross-shop through some exchange system? open finance which allows anyone in the world to participate I am not familiar with why it’s hard for people from India and Brazil to buy US equities. Why is that hard for them? non fungible tokens is pretty clear (i.e. scalping)The French Tennis Federation controls tickets to Roland Garros and there is no scalping (I believe Wimbledon does this as well). The end result was tickets were both expensive and hard to obtain. I don’t think scalping is a problem. Having Ticketmaster and StubHub as monopolistic powers is a problem, but scalping is overall beneficial. Do you mean that scalping would exist but without monopolies?

        1. Tushar Jain

          I expect the value of various crypto networks to follow a power law distribution because of the way value of a blockchain and security of said blockchain are related.People in other nations do not have access to global capital markets. Eg: even in the US, it is difficult for the avg investor to get access to many Chinese equities that do not have ADRs.Ticket scalping hurts both the artists and the fans. Some artists want to make sure their tickets are priced accessibly to their fans but they literally cannot do that because of scalping. I am not familiar with how Tennis tickets are sold but from what I have seen, they are not priced accessibly.

          1. Adam Sher

            … follow a power law distribution… Makes sense. …difficult for the avg. investor to get access to many Chinese equities that have ADRs Access to capital markets is partly a function of local governance, accounting policies, and enforcement. It is no surprise that many countries are not eligible to participate. Personally, I’d err on the side of letting more in and risking some bad actors compared to excluding everyone else.Chinese companies are a good example. I’ve been personally defrauded by my investment in a Chinese ADR – shame on me for bad underwriting. Different accounting standards (e.g. GAAP v IFRS v choose your own accounting adventure) compound the problem of allowing access.I’d prefer to see some other competitive stock exchange, maybe on a block chain, that I want to invest in where there is better financial transparency. Reading 10Ks, 10Qs, and MD&A can be soul destroying. ticket scalping hurts both artists and the fans… I think you’re giving too much benevolent credit to artists. There’s nothing stopping venues or artists from dictating the terms of resale. I attended several events this year where that was the case. Some of these events were for artists who sell out large arenas.I’ve attended the Grand Slams in the UK, US, and Paris and the US is by far the cheapest. At the US Open, you can buy tickets on the resale market for below face. That doesn’t mean you’ll sit court-side for a Roger Federer semi-final but that’s a poor expectation to hold.

      2. LE

        It’s crazy to me that we can’t currently control scalping for concert ticketsWho is scalping really hurting? The big artists who should be making the money? Or the people with no money that can’t afford tickets because the price gets driven up by people who game the system (and that will always happen with any system you design by the way)?Take it one step further. What’s fair about what is being charged in the first place for entertainment? The money in the entire business of even say a Broadway play? Where it’s super expensive to get seats let alone good seats to a play is over the top. In any normal business price is increased to equal demand. But in entertainment that doesn’t happen. Not to be naive here but if the venue wanted why couldn’t they jack up prices themselves and pocket the money? Why can’t they do a version of what airlines do with pricing yield management? Why is the blockchain even needed at all to solve this (note the quotes) ‘problem’. I suspect part is some kind of PR of not taking advantage of fans for the backlash. They do this of course now I can see in other ways with all sorts of premium add ons.It’s *crazy* to me that a middle class person in India or Brazil in 2018 can’t easily buy Apple stock (or a derivative that closely tracks AAPL).Maybe (once again) it’s the opposite. Instead of driving up the price of Apple stock (which is good for me; I own some) they should be putting money into companies in Brazil or India as an investment? Maybe that is a problem to be taken on by someone (more than it is already happening I mean).

        1. Tushar Jain

          It is completely unfair to citizens of countries like Brazil and India to deprive them of access to more developed capital markets. It is not up to us to decide that they “should” be putting their money into companies in their own nation. It is their money and they should be equal global participants in the financial system.Ticket scalping hurts both the artists and the fans. Some artists want to make sure their tickets are priced accessibly to their fans but they literally cannot do that because of scalping.

          1. LE

            completely unfair to citizens of countries like Brazil and IndiaI would say it’s more ‘unfortunate for them’ than ‘unfair’. Brazil and India are not the US. I am not sure it is our obligation in the US to make things so that the ‘middle class in those countries’ can participate in our financial markets and if we don’t then it follows that it is ‘unfair to them’. For example if our legislators spent time on this (so it benefits them) instead of an issue that benefits those in our country I would say that is not an appropriate use of their time. This doesn’t mean that someone couldn’t make an argument that it is good for us. (As I said I own the stock so it would be good for me personally). But I don’t think it is ‘unfair’ that they can’t buy that stock and I stick with that. People in those countries from what I know that aren’t in the same ‘class’ are literally living in total shit and around crime. Why am I supposed to think it’s unfair for the middle class that they can’t buy tech stocks in the US?Once again as far as ticket scalping the artists that this hurts are the ones making boatloads of money. The artists who need the money (not, say, Bruce Springsteen or Taylor Swift) are not impacted by ticket scalping. By the time an artist is impacted by ticket scalping they are in demand and presumably earning a living.That said this doesn’t mean that the problem shouldn’t be fixed. What I am reacting to more is the hyperbole and choice of words surrounding who is hurt by this. That is what I don’t like.Tickets are ‘entertainment’ and not essential in any way. One of the reasons you work hard and earn money is so that you can enjoy things that are expensive for whatever reason that is. Life is not fair. Lesson #1 work hard and make it fair for you. Fred lives in an expensive home in an expensive city. Is it unfair or unfortunate that many others don’t get that because it is so expensive and only people who make tons of money can live that type of lifestyle (in that place)? Once again, it’s not ‘unfair’ just the way it is. That is my opinion.

      3. kidmercury

        brazilians and indians can buy AAPL through instruments known as CFDs, which are banned in the USA. CFDs are basically run by bucket shops. i wish it was legal here in the USA. you could argue a blockchain solution, though that still seems a bit theoretical IMHO. moreover, it will not fly legally in the USA if just tokenize my stock in AAPL not only because of SEC objections but because of concerns over excessive fragmentation of liquidity, the same stuff people complain about with dark pools and the obfuscation of true price that creates as a result (according to that viewpoint). so you will have a lot of objections from companies issuing stocks and even more so from institutional investors in those stocks who are playing the value game and not the arbitrage derivative tokens game.

      4. cavepainting

        Curious about your thoughts on the Web3 stack dis-intermediating middlemen and allowing for buyers and sellers to discover and connect directly in a decentralized network. Is this la la land or closer to reality than it seems?

      5. jason wright

        why are comments disabled for your videos at youtube?

    2. kidmercury

      here is one real example that some companies are working on, there is no viable example of success i can point to yet but i think the example is relatively simple to understand the value proposition is clear. some applications are tokenizing their revenue and distributing tokens to those who contribute to the revenue stream. let’s take a sample publisher like espn.com. right now ESPN.com makes a bunch of money by having original content and selling ads against that content. “ESPNtoken” could be issued to content contributors, so each unique page view (or whatever metric) gets you one token. X% of revenue that ESPN receives each month goes into a pool, and the total value of that pool divided by the number of outstanding tokens gives you an idea of the value of the token. things can get more complicated (for instance, unredeemed money in the pool gets invested in a fund, returns on those funds go back into the pool, etc) but that is the basic idea.something like this illustrates how an incredibly small company can leverage tokenomics to destroy a huge publisher. it is really just the evolution of youtube, which used crowdsourced videos to totally disrupt video entertainment.one could argue that this is quite similar to what has been doing with various virtual currencies that do not have anything to do with the blockchain. i would generally agree, and would say that some things simply cannot occur until the time is right and culture as a whole is ready. i would also say the decentralization/open standards component introduced by blockchain technology makes it easier for everyone to trust a system like this, and it also makes it easier for this type of system to interconnect with other systems (so ESPNtoken can trade on an exchange, can be used in commerce, etc).

      1. LE

        it is really just the evolution of youtube, which used crowdsourced videos to totally disrupt video entertainment.Youtube did something but it didn’t disrupt (traditional) video ‘entertainment’. Netflix (as evolved) et al disrupted video entertainment. Netflix disrupted entertainment period. [1] Youtube allowed people to post videos about all sorts of minutia. It didn’t disrupt really (in the early days or until recently) traditional ‘video entertainment’. Ok maybe rock videos that you might have purchased on DVD you can now get on youtube for free. I do that all the time.One thing youtube did disrupt though is learning. You can find out how to do anything by watching a user created video on youtube. Need to replace the door in your Samsung front load washing machine? There is a video on youtube for that. Want to know whether you should buy a Sony A7iii or a Sony a7riii? Go to youtube and watch a video. It is almost to easy. It’s scary how many things you learn and find on youtube.My point is to me ‘disrupt’ means ‘displace’. In this case youtube didn’t so much as disrupt or displace ‘video entertainment’ as it did greatly expand video entertainment. Part of that sounds like I am making your point. But if you look at what video (and in particular ‘entertainment’ was prior to youtube (the video store) you will see that it was Netflix that disrupted that.What I really want to know though is if you are going to see Vice (the Cheney movie) in the theater or wait until it is online.[1] Some Netflix entertainment is so good and perfect in terms of how it grabs you and keeps you in a zone that it makes traditional Hollywood content seem boring and tedious by comparison. That is what I call ‘disrupt’.

        1. cavepainting

          Neflix disrupted entertainment by time and location shifting where people watch shows and movies.Youtube disrupted brand advertising by changing where people spend their white space time.

        2. kidmercury

          my wife and i both said we should see Vice, but we watch very few movies so i doubt we’ll see it, at least not for a few years. i do like watching well done political movies as it offers a gentle way to bring up kookological subjects with people that otherwise would not be interested (i.e. most people). i’m still amazed at the movie snowden, they talk about some pretty serious stuff there, i guess people just care so little about anything of importance beyond the present condition of their immediate self. the unshakeable indifference of people is still something that amazes me, even after all these years of kooking. it’s an intriguing combination of depressing, amusing, shocking, and stupefying.

      2. Adam Sher

        What I understand you are saying Is that tokens could be used as a way to allocate revenue/profits in the home currency (USD) to the content creators. The token mechanism automates the performance based pay, which would presumably be better than waiting for your manager to submit your key performance indicators (KPIs) at the end of each quarter/semester/year.Assuming that the above holds, is block chain the most effective, or only, way to implement automated performance pay?

        1. kidmercury

          it is definitely not the only way to do it; for instance, youtube is sharing already ad revenue with select content creators, using some combination of viewership metrics and content monetizability, though its algorithm is probably not clearly understood. how many people can be sure they are not being ripped off?blockchain-based automated performance pay does offer the potential for new features. for instance, something i expect to emerge and alluded to previously is that a publisher will create a token that coordinates content creators, advertisers, marketers who drive traffic, etc. to facilitate reinvestment in the entity’s publishing operations, the token’s monetary council (aka central bank) may wish to reward tokenholders who do not cash out immediately by paying interest on the token. the unredeemed funds can then be used to invest in infrastructure or expansion of some kind, which hopefully creates more revenue. maybe you could do something like this without a token, but i think the token reduces the amount of trust you need to have in other humans.that is just one example i share because i think it will work and i am excited by it. ultimately to your line of questioning i don’t think in the long run blockchain will be that different than many centralized, application-based approaches to automated performance pay. but it has captured the imaginations, for whatever reason, and i think that may be enough to make it the means by which the internet’s general trend of peer-production and powerful coordination networks continues forward.

  4. Adam Sher

    Around 19 minutes, you hit the nail on the head, Fred. It is unclear how much developers/people will value the degree of decentralization and how that is directly related to scalability.

  5. Adam Sher

    Good closing statement. The track record of activist investors in public markets isn’t good on average so hopefully you’ll do better. Maybe it’s best for you to be able to move your money instead of agitate for better company management.

  6. jason wright


  7. creative group

    CONTRIBUTORS:This video is the reason why we enjoy and respect Fred. He doesn’t mind saying he didn’t see any of the underlying building blocks of cryptocurrency.We will venture (pun intended) to say USV (Fred) is in a great position on the BTC investment. Especially investing at the prices of 2011 (.11).We also understand why Tushar Jain was chosen as a partner by USV to invest in. He has the technology chops. But it appears people who are working with a partner they respect and is considered a very influential person in his space people appear overwhelmed by their presence. When Tushar appeared to get over the start it shows he is very a strong partner.We have never been overwhelmed by any person but would internally acknowledge if we are in the presence of a great person. Like when we were in the presence of Muhammad Ali on several occasions or Michael Jordan on one occasion. After all the accomplishments you think of the people have attained they are still human.More humbled by a veteran who have sacrificed for the freedoms we enjoy daily. Thank a veteran the remainder of the year for their service or sacrifices made on our behalf.Off soapbox as you were!Captain Obvious!#UNEQUIVOCALLYUNAPOLOGETICALLYINDEPENDENT

  8. creative group

    CONTRIBUTORS:Tushar @ 23:24 explaining the defense (ERC standards) of ETH that can’t be forked away.The companies who control the technology usually wins.Captain Obvious!#UNEQUIVOCALLYUNAPOLOGETICALLYINDEPENDENT

    1. jason wright

      That has the sense of being more like a proprietary software ecosystem trap. What company would that be?

  9. William Mougayar

    Lots of truths in that discussion .

  10. jason wright

    Vitalik Buterin is a cult. He conforms to our social and cultural stereotype of what a “genius” must be to qualify as a genius. He looks odd, and he talks gobbledygook (the secret language of the priestly class), and we take his charitable handouts with gratitude. Ethereum has become a church and a religion, and he’s its icon. That’s his talent. That’s his superpower. He’s made money. He gives performances on the crypto ‘lecture circuit’. He has that lifestyle. Where’s the grit? Where’s the skin? Where’s the product?

    1. kidmercury

      ethereum is still the easiest place to launch a token and build a blockchain application. that’s a huge accomplishment for buterin…..i find it analogous to wozniak and the apple II

      1. jason wright

        Why would somewhere else be harder to launch a token? Rhetorical.

      2. jason wright

        …and…just another example of how Ethereum was concocted by its creators to enable instant and rather unnatural supply side growth (ERC20 & apps) to satisfy their own personal enrichment but with no technical go to market strategy (the volume and transaction speed log jam). It’s a trap.

        1. kidmercury

          i don’t think ERC20 tokens are “unnatural supply side growth,” i think they are the easiest place to bootstrap an tokenized app/business model. that they are unscalable might be solved in time, but even if it is not, it is not necessarily a problem; ERC20 tokens are a great place to test out an idea to see if it can get traction, and if it does, then there may be justification to invest in a completely new blockchain to support the tokenized economy in question.

          1. jason wright

            I can see that idea. It’s a catch 22 situation though. How will any one app or select group of apps get traction that proves their wireframe potential if they’re denied access to the market by cats that consume Ethereum’s entire ‘bandwidth’? I wonder how many ERC20 projects started out from day one planning at migrate to their own platform, and how many of those are anywhere near proving to themselves that the credibility of their plan is supported by market feedback? It has to be a handful at best. Ethereum should have vetted ERC20 proposals, and selected the ones most suited to proving themselves based on the limitations of the platform (speed, volume). Ethereum didn’t do that. It went for ‘mass’, which equals ‘money’ (i.e. Ether token’s pumped price). The process was about enrichment for a select few (Wood, Buterin, the inner circle) in my opinion. The app layer before the protocol/ distribution layer is capable of supporting it? That’s cart cart before horse. Ethereum isn’t a protocol layer. It’s a wannabe protocol layer.

          2. kidmercury

            IMHO the best opportunities will be revealed in crappy apps that are launched on ethereum due to it being the easiest place for lean teams to launch an app and get some distribution, and those apps find users who like the app and use it even though it is crappy and slow on ethereum. that will reveal a very real problem users are craving a solution for, and thus will warrant greater investment in a more robust application.

  11. jason wright

    I wonder if the authors of Ethereum deliberately chose not to form a company to manage the development of the project to avoid having direct legal accountability for their actions? Controlling minds resigning at the earliest opportunity and cashing out would not have been in the company’s or the project’s best interests. Ethereum has always seemed a suspicious undertaking to me, and i’ve consistently expressed that view, both here and elsewhere. It is only now also the in vogue view of the market.

  12. Mario Cantin

    Who am I to say, but I finally got around to listening to this today as I was cleaning my chandelier on Christmas Day, and it’s the best talk on technology I’ve ever heard — Crypto or otherwise.

  13. jason wright

    Ethereum Switzerland GmbH, Grienbachstrasse 55 Baar, 6340, Switzerland. One wonders why it was put into liquidation and not used to manage the project. Fancy looking accommodation. I wonder who lives there? https://www.google.com/maps