Bitcoin, Token Economics and Web3's Investment Strategy with Austin Barack of Relayer Capital
Feb 10, 2024
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Former Coinfund partner Austin Barack, now the Founder and Managing Partner of Relayer Capital, discusses token economics, the transformative power of Bitcoin and Ethereum, Web3 startups he will be investing in, smart contracts and decentralized applications, self-custody, interoperability, rise of DeFi and NFTs, evaluating individuals in early-stage investments, managing risk, and the importance of deep research in the crypto industry.
Decentralized applications can improve coordination, reduce trust requirements, and increase inclusivity in the financial system.
Composability in crypto enables new possibilities for decentralized assets and applications, such as decentralized stablecoins, ICOs, DeFi, and NFTs.
Deep dives
Investing in the Future of the Internet and Crypto
The podcast episode features a conversation with Austin Barak, a trailblazing mind in the world of digital assets and blockchain. Austin discusses his journey in the crypto space, highlighting the paradigm shift he experienced with Ethereum's programmability and the broader surface area of application building. He emphasizes the potential for decentralized applications to improve coordination, reduce trust requirements, and increase inclusivity in the financial system. Austin shares his insights on managing risk in the crypto industry and explains his approach to seed-stage investments, focusing on the team, product gap, and shipping capabilities. He also discusses the unique opportunities for user incentives, new verticals in decentralized finance (DeFi), and the growth of decentralized physical infrastructure.
The Power of Self-Custody and Composability in Crypto
The conversation delves into the importance of self-custody in the crypto world, highlighting how it gives individuals control over their own financial situations and protects against asset seizure. Austin distinguishes self-custody as a fundamental innovation in digital cash that enables greater financial freedom. The discussion also touches on the concept of composability, where different protocols can interoperate on one chain, creating new possibilities for decentralized assets and applications. Austin cites examples such as decentralized stablecoins, the concept of ICOs, and the rise of DeFi and NFTs, all of which demonstrate the exciting potential of composability in crypto.
Risk Management in Bull Markets and Investing Alpha
The podcast explores the challenges of managing risk in a bull market environment. Austin shares his perspective on allocating investments and adjusting portfolio weightings based on different risk buckets and degrees of conviction. He emphasizes the significance of ongoing evaluation and reassessment of projects based on milestones, user traction, and development progress. Austin highlights the wealth of data available in the crypto space, including real-time metrics, open-source repositories, and active community engagement. He underscores the role of community involvement and user feedback in shaping the direction of projects and mentions examples like GitHub repos, Twitter spaces, and decentralized autonomous organizations (DAOs).
The Rise of Incentive Design in Web3 and the Saga Phone
The podcast episode explores the power of incentive design in web3 and its impact on user acquisition and engagement. Austin discusses how crypto projects can incentivize early users through token rewards and make them stakeholders in the network. He highlights examples like the Saga Phone, a proof-of-concept mobile device that offers web3 optimization and rewards users with tokens or NFTs. The conversation delves into the potential disruption of traditional app stores and the unique opportunities for developers to acquire users through token incentives. Austin also touches on the growth of decentralized physical infrastructure and emerging verticals like connected cars, decentralized computation, and decentralized mapping.
This week on The Index, host Alex Kehaya welcomes former Coinfund partner Austin Barack, now the Founder and Managing Partner of Relayer Capital. Get ready for a deep dive into token economics, the transformative power of Bitcoin and Ethereum, the types of Web3 startups he will be investing in this year, and an in-depth discussion on the trailblazing paths carved by smart contracts and decentralized applications.
