When it comes to building companies and making the right investment decisions, Mahbod has been successful in both realms. He has had the Midas touch since leaving Genius, from declaring the Bitcoin is the Truth in his Observer piece in 2014 to then becoming a Co-Founder at Everipedia a year later. Since Mahbod first bought Bitcoin in 2013, the cryptocurrency market has skyrocketed to massive value, even through some drastic downturns. Moghadham is confident in the future developments of blockchains, and shares what his thoughts on what you need to know right now about it.
When did you first get into crypto? Why did you decide to buy?
In late 2013, about 2 months after my brain surgery, I met Balaji Srinivasan – the “Bitcoin Prophet”. Balaji had just joined Andreessen Horowitz and came to the Brooklyn Rap Genius office to ask me to ask Nas (who was a Rap Genius angel investor) to record a diss track about Gawker reporter Sam Biddle. Balaji is friends with Peter Thiel, who (now) famously hates Gawker and Biddle.
I AM NOT MAKING THIS UP!!!
I told Balaji that his request sounded… strange. But I said I would ask Nas. (I did ask Nas and Nas said no. It is a shame! A Nas diss of Sam Biddle would be awesome…)
That’s the thing about Balaji – he is a very unconventional thinker, but he actually knows wassup. His other idea he told me was an apartment building where every facet of your life is taken care of and included automatically in your rent – food, laundry, gym + trainer, sort of like “Uber for Life”..
At this very same lunch, Balaji told me about Bitcoin. Balaji is Indian, but he has very sexy green eyes. He hypnotized me! I bought my first $10K of Bitcoin the same day (at around $1K/each – the peak for like 6 years lol) and convinced my cofounder Tom Lehman to buy some too. As soon as he told me about it, I was 100% convinced it would be huge. Ever since I was a kid, I thought money should be electronic, and that it should be impossible to steal (which although theft is rampant in crypto right now, I think will be the future of money!!)
You often hear that Bitcoin is going to disrupt finance like the internet did to media and communication, and Erik Voorhees tweeted “Money being controlled and managed by the government will, someday, appear as arbitrary and distasteful as religion or speech being similarly handled.” Do you agree with these statements?
I think the blockchain will be disruptive, and Bitcoin is a big part of that. Bitcoin is digital gold. I think all fiat will also eventually be digital, but Bitcoin will play the role of gold. Government money will not go away, it will simply become electronic, just like all other money.
Over four years ago, Nobel-prize winning economist Paul Krugman said that “Bitcoin is Evil.” What do you think of traditional economists perspectives in the world of Bitcoin? Do they matter?
Paul Krugman is the stupidest, most overrated writer on the planet. If the New York Times was a person, it would be Krugman. His statements on the Internet and cryptocurrency seem to have had no bearing on his career status. How can that be? Why is this guy allowed to have a column? Get rid of him! NYTIMES: save what little stature you have after whoring yourself to the plutocrat dictator of Mexico!
I’m not too familiar with economic research in academia, so I don’t really know where people stand. I know Robert Schiller said some stupid Krugmanesque things too, so he is dead to me now. What really scares me is that my college roommates who are now partners are major investment banks still seem to think crypto is a hoax. If crypto turns out to be real, I demand that Goldman Sachs get rid of these guys and hire me instead! How can you be a finance professional, and have the biggest transformation in finance staring you in the face, and you don’t see it? Surely if that is the case you don’t deserve your job – you probably just got hired cause you’re tall…
If they were alive today, what do you think your favorite philosophers and thinkers would say about cryptocurrencies?
One thing that saddens me is that so many brilliant people seem to be against cryptocurrency. They seem so sure of themselves too – they aren’t even willing to just be agnostic about it. I got to pitch crypto and Everipedia to my favorite law professor a couple weeks ago tho – Lawrence Friedman – I thought he was going to be calling it a tulip craze and whatnot but he was actually very open-minded! It made me so happy.
But still, I think my favorite philosopher – Charles Dickens – would have been either mute on crypto or perhaps even disappointed in its consequences, even if he believed it would work. I think crypto is going to hasten the rise of the “Technocratic Elite” – just as the internet did. Basically, technology is transferring power from people who are alpha, tall, and physically formidable to people who are intelligent, and crypto is going to be a HUGE catalyst of this trend. Dickens would probably be sad that there won’t be as many attractive rich people anymore.
The thing is, I think crypto is going to reshape society so much that most people from the past simply wouldn’t be able to be comfortable with it. It is like the internet in that respect.
You have spoken highly about Coinbase and Brian Armstrong in the past. What separates them from other companies in the Bitcoin/cryptocurrency ecosystem? How would you respond to critics that say Coinbase is making crypto more centralized and takes away the agency of the hodler?
Balaji is who convinced me to buy Bitcoin, but Brian Armstrong is the person who convinced me to even take Bitcoin seriously in the first place. I met him a year before I met Balaji, at Y Combinator demo day. When he told me that his company does Bitcoin, I couldn’t believe it. I had heard of Bitcoin before, but I thought it was something like Pokemon. I didn’t know it was a serious thing until I met Brian. I was shocked that such an alpha guy would be CEO of a Bitcoin company, and also shocked that a Bitcoin company would be in Y Combinator!
I angel invested in Coinbase in 2014, after I had already bought a significant number of Bitcoin. It is my proudest investment. Coinbase will end up becoming the “Chill Visa”. Even though crypto is an egalitarian force, there still needs to be dependable financial structure that is connected to the Illuminati, and I think Coinbase will provide that.
To put this in the context of Howard Zinn’s “steam engine” Marxist theory of history, Coinbase and crypto are going to fuck us less than the previous financial institutions have. It is all about baby steps – word loife.
What do you think the greatest contribution that Bitcoin and cryptocurrency will be in humanity?
As I indicate above, I think cryptocurrency will be a major egalitarian force for humanity. It will eliminate many financial middlemen and enable a lot more people to make a living from the internet. It is coming at the right time, since I think self-driving cars and automation are going to create armies of unemployed people very soon. I see a lot of people making a living on a combination of universal basic income and participation in the “cryptoeconomy” – doing work like editing my site Everipedia for crypto payments.
I despise class and wealth, which is the main reason I am obsessed with cryptocurrency.
What blockchain/cryptocurrency projects are you most excited for? Why?
Uhhhh well OBVI I’m most excited for Everipedia to go on the Blockchain. For “IQ” to be a currency is just such a beautiful metaphor – I’m so excited!!!
Wax Token is really cool – it is already a huge site and now it is the crypto marketplace for nerdy fantasy stuff. Cryptokitties are similarly cool – they tap into the blockchain’s ability to create a digital asset that feels unique – it feels like a real live thing.
Steemit was a huge source of inspiration for Everipedia. They built “Crypto-Reddit” and it is blowing up, so we think “Crypto-Wikipedia” is going to be even bigger!
Where do you get your advice from? What is your trading strategy?
I’m trying to be Warren Buffett, if Warren Buffett was not a caveman who completely slept on the Internet, on the Blockchain, and pretty much every other technological advancement in the modern era. I’m trying to be the “PERSIAN WARREN BUFFETT” – except much more handsome, and not bragging about eating McDonald’s and drinking Coca Cola…
(Basically what I mean by this is that I try to make very, very long-term investments in projects that I believe in and where I think I add value, and I don’t actively trade my shares in them.)
Do you think we are in a bubble? Is it too late for someone to invest?
I could definitely see huge crashes happening. There was one a couple days ago. Cryptocurrency is hella-volatile, so it should be expected. I think it’s funny people are surprised by the volatility. It’s like if you’re a seasoned poker player and you’re watching poker on TV with amateurs and you get sick of them oohing and aahing every time someone has pocket aces…
The best way to invest in crypto is to set a monthly budget, and invest that every month. That way, if there is a big crash, you can buy more. I see the value of many cryptocurrencies going up long-term obviously, that’s why I’m in this space.
Where do you see crypto a year from now? Five years from now?
I think it will become a dominant force. My biggest question is whether the internet giants – Facebook, Amazon, Google – will adapt to the blockchain or be destroyed by blockchain competitors. To see these juggernaut companies wiped out in my lifetime – oh man, that would be such an incredible thing. I am a huge fan of what Joseph Schumpeter called “Creative Destruction” – and I think Blockchain will be the most CREATIVE, most DESTRUCTIVE, most DISRUPTIVE thing any of us have ever seen…
How would you describe the crypto mania today to the earlier crypto bubble in 2013-2014?
Check out the Google Trends:
Isn’t that crazy? It seemed like people cared a lot in 2013! I guess not…
What advice would you give to people new to buying crypto?
It is a scary place. The worst part is – I don’t think there is any secure way to store coins. Cloud services are not secure and hardware wallets seem jank (to me, at least). I think the future of crypto is to establish a secure infrastructure that makes it impossible to hack or steal. I think it can be done!!
Crypto is a beautiful technology that can really improve the world. It is cool to be involved in any way one can be. Try earning coins too – join Everipedia you will love it!