Dogecoin’s history showed crypto why it’s haste to dismiss a good meme that could manifest into concrete progress, said Coinbase co-founder Fred Ehrsam in his interview with Emily Chang on a Bloomberg TV appearance.
The largest cryptocurrency exchange in the US, Coinbase, was launched out of a two-bedroom apartment in San Francisco after Ehrsam met Brian Armstrong on the Bitcoin (BTC) subreddit.
Three main ingredients to understand crypto
“It did seem like a crazy idea at the time,” said Ehrsam, a computer scientist and engineer by training and a “hardcore” gamer by passion, who left his FX trading position at Goldman Sachs in 2012, in order to dedicate himself to crypto and build up the company.
“History is yet to be written,” Ehrsam told Chang, adding that “crypto is a nuanced issue and it is possible the US gets crypto wrong.”
He says crypto is the next internet-sized opportunity for the US and while he’s not disapproving of regulators’ tackling and risk mitigation. However, Ersham fears China might beat the US on the crypto front and sees the last crackdown on mining in the country as an opportunity for others to step up their game and make it more decentralized.
Besides addressing the economic potential of crypto, he said it could help the US to “square the circle on the privacy internet issues.”
Bleeding edge of DeFi
In 2017, when “the doors opened” and Ethereum (ETH) stepped on the scene, showing blockchain-based applications were possible, he discovered a “whole new frontier” and left Coinbase to launch his own blockchain investment firm Paradigm, together with Matt Huang.
“Crypto is its own rabbit hole,” said Ehrsam, adding that Paradigm approaches it from three main aspects of crypto: new digital money, new financial system, and a broad internet application platform, adding that in due time, mainstream consumer apps and NFTs could unravel as “the bleeding edge of DeFi.”
He sees the NFT market volume down and eventually “90% will have little to no value”, but says the technology itself is extremely valuable and those few survivors will remain as fundamental building blocks for further development.
“I go so far as to say that 90% of NFTs produced, they probably will have little to no value in three to five years. You could say the same thing about early internet companies in the late ’90s too, though,” he said.
Ehrsam joked that NFTs made it really obvious to crypto insiders and nerds that the rest of the world cares more about culture, music, and art, explained how they pushed mainstream awareness of crypto, and expanded its audience.