On-Chain Audits & Rules Are Going To Dominate Future
Today’s letter is brought to you by Frec!The wealthy have used a secret strategy to make money and save on taxes for decades — direct indexing and tax-loss harvesting. The problem historically is that it takes a large team and lots of money to pull these strategies off. That is all changing now. Frec makes direct indexing available to every investor at 1/10th the cost (0.1% annually to be exact). It’s nearly identical to investing in ETFs, except it allows investors to take advantage of tax benefits — by owning the stock directly. With Frec Direct Indexing, you can achieve index-like performance but end up with more money through tax loss harvesting.
Sign up today and start saving money on your taxes! To investors, One of the promises of blockchain technology is a public ledger that can be audited by anyone, at any time, from anywhere in the world. Industry proponents historically point to this feature as a way to confirm how many bitcoin are in circulation, how many bitcoin are created on a daily basis, and the 21 million limit has not been changed. That is not the only use case though. Yesterday we got another use case that could change finance. Bitwise, a $1.5 billion asset management firm focused on the crypto industry, published the public bitcoin address for their spot bitcoin ETF holdings. Their announcement read:
You can see the public address on the fund website too: This may seem like a small item, but for the first time in history investors are able to verify the asset holdings of an ETF. It is easiest to understand the difference by looking at the gold ETF. There is reportedly billions of dollars in gold sitting in a vault, yet none of the GLD investors can verify or audit those holdings when they want. Bitwise’s bitcoin ETF allows investors to do that now. It wouldn’t be the crypto industry without some sort of chaos or jokes, so naturally someone sent 0.00006969 bitcoin to the public wallet address. This means that Bitwise now has the only over-collateralized bitcoin ETF on the market as well. Obviously, this is a joke, but it does highlight the ability for people to send bitcoin to this wallet address without Bitwise having to do anything. This idea of on-chain audibility, along with on-chain governance of rules, is only going to become more important in the world. Last year we saw three of the largest bank failures in history occur, which potentially could have been identified earlier if anyone in the world could have audited the various bank holdings. There will be less interest for companies to broadcast their internal balance sheets, but anytime a company is reportedly holding assets for customers or partners it makes sense for them to be publicly auditable. Remember, the Pentagon has failed six straight audits. Imagine a world where the government, who is entrusted with the citizens’ assets, had everything publicly verifiable. There would be less waste, more efficiency, and probably better outcomes. Anything that can be on-chain likely will move on-chain in the future. This on-chain world uses software to enforce the rules as well. The phrase “code is law” gets thrown around often to describe the phenomenon. This is possible because everything on-chain is digital. The assets are digital, the market participants are digital wallets, and the rules are written in a digital database. There will be instances in the future that can’t come on-chain for rule enforcement. Take the current southern border crisis as an example — Texas has declared an invasion of their state and is fortifying their border. The national government sued them in court to prevent them from fortifying the border. The Supreme Court ruled in favor of the national government. Texas is ignoring the Supreme Court decision and claiming this is a state’s right issue, not a federal government issue. Now a number of other states and governors are coming out in support of Texas and Governor Abbott. The US Constitution clearly lays out rules for our nation. The problem in the analog world is how to interpret these rules, along with how to enforce them. Comparing these challenges to the on-chain world, where software requires crystal clear rules and enforcement directions in advance, it is easy to see why people will continue preferring the digital version. Again, it won’t always be possible, but it will be the preference whenever it is possible. The idea of on-chain audibility and governance is at its infancy. The trend is clear though — we are going to see more things move on-chain as time passes. You can’t stop an idea whose time has come. The better system is here. The early adopters are adopting it. Eventually the masses will follow. Hope you all have a great day. I’ll talk to everyone tomorrow. -Anthony Pompliano Fred Thiel is the Chairman & CEO of Marathon Digital Holdings (NASDAQ:MARA), a digital asset company that mines cryptocurrencies with a focus on the blockchain ecosystem and the generation of digital assets. In this conversation, we talk about energy harvesting, brand new bitcoin mining sites, bitcoin halving, hashrate, outlook for 2024, and more. Listen on iTunes: Click here Listen on Spotify: Click here Marathon Digital CEO Breaks Down Why Miners Are Well Positioned Post-HalvingPodcast Sponsors
You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research. You're currently a free subscriber to The Pomp Letter. For the full experience, upgrade your subscription. |
Older messages
The New Players Won't Act Like The Old Players
Wednesday, January 24, 2024
Listen now (2 mins) | To investors, The new capital flowing in the crypto industry from Wall Street and traditional investors will not behave like the capital that has been here for years. Let me
Price Is Trying To Distract Everyone
Tuesday, January 23, 2024
Listen now (3 mins) | Today's letter is brought to you by Espresso Displays! I normally work on my desktop computer and am hyper productive. The second that I leave my desk, I lose my productivity
What If The Fed Already Won The Fight Against Inflation?
Monday, January 22, 2024
Listen now (5 mins) | Today's letter is brought to you by ResiClub! ResiClub is the leading publication for the residential real estate market. Housing affordability is the worst that it has been
Podcast app setup
Sunday, January 21, 2024
Open this on your phone and click the button below: Add to podcast app
Bitcoin ETFs Receive Billions, But Price Goes Down?
Friday, January 19, 2024
Listen now (4 mins) | Today's letter is brought to you by Dream Startup Job! Dream Startup Job is the premier marketplace for connecting ambitious job-seekers with the world's most innovative
You Might Also Like
Low competition niches with high traffic potential
Friday, July 26, 2024
1.2 million visitors with a DA of 9!?
Mindsnack Ep. 6 - 4 Things That Have Helped Me
Friday, July 26, 2024
do these things.
SearchGPT Announced! (The End of Google?)
Friday, July 26, 2024
Yesterday, OpenAI announced SearchGPT, an AI-powered search engine that is a direct competitor to Google search. What does that mean for Google? What does it mean for publishers? This is the first
🎙️ Find That Pod #272
Friday, July 26, 2024
Let's discover some awesome podcasts together.
Temu may be a worthy Amazon competitor after all [Crew Review]
Friday, July 26, 2024
Q4 is approaching fast. Take advantage of the sales season and get more funding for your e-commerce business. We'll show you how on July 30, 2024 at 9:30 AM (PST). Hey Reader, It may not have the
Bitcoin 2024: All Eyes on Nashville
Friday, July 26, 2024
Marathon Digital Goes Full HODL with $100M Buy
Digiday Awards: One week left to submit your entry
Friday, July 26, 2024
Have your work viewed by judges from Google, Chipotle and more
You don’t need more capital, Reader. [Webinar]
Friday, July 26, 2024
Hey Reader, Most successful online entrepreneurs have taken risks, ie, loans, to scale their businesses to the next level. But how do you know when to borrow more money and when to hold off? This July
Influence Weekly #347: TikTok’s Secret Plan To Shake Up European E-commerce: What 40 New Hires Reveal
Friday, July 26, 2024
A Fashion Influencer Sues, Alleging a Creator Copied Her 'Aesthetic
Weekly Dose of Optimism #104
Friday, July 26, 2024
HIV Prevention, AI Tsunami, Statecraft, GLP-1 Again, Olympic Exoskeleton ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏