Recent startup, tech, AI, crypto learnings: “Perspective has an expiration date, no matter how hard you try to hold on to it.”

Deng Xiaoping and Robert Moses using the same strategy:
Don’t ask for permission, don’t argue, just do it and if you move fast and execute well they’ll either come to agree or, with things already half built, accept with no other choice.

Smart contract systems have proven product market fit and have dramatically increased in security and safety in recent years. They are now able to secure ~$100 billion on public networks with nation state bad actors attacking them daily. This level of security and programmability beats any existing electronic trading network.

Over a quarter century later, handling outliers is still the Achilles’ Heel of neural networks. (Nowadays people often refer to this as the problem of distribution shift.)

(This is also why we still use calculators rather than giant, expensive, yet still fallible LLMs, for arithmetic. LLMs often stumble on large multiplication problems because such problems are effectively outliers relative to a training set that can’t sample them all; the symbolic algorithms in calculators are suitably abstract, and never falter. It’s also why still use databases, spreadsheets, and word processors, rather than generative AI for so many tasks that require precision.)

This is bullshitization, a process like financialization or enshittification. A derivative phenomenon that amplifies the underlying bullshit instead of attenuating it.

the Ministry of Finance, working with the central bank, spent 9T Yen, or around $55B USD, in currency interventions between these two moves. Recall that they have around $100B USD in liquid cash and $1T USD in Treasury bonds, both of which could be used theoretically to defend their currency

However, if you’ve ever been a manager, you know that a “good” direct report is able to magically transform your vague idea into a really great outcome. You can say, “find me a stock to invest in,” and a good employee will come back with something dazzling. The less time you have to spend specifying what you are looking for, the more valuable that employee becomes

The Plaza Accord was an unprecedented (now rarely mentioned) weaponization of the dollar by the US to dethrone Japan’s economic leadership – via USD depreciation. This is where the now widely popularized “Carry Trade” was bourn, compounded by a series of mistakes by the BoJ, and how the social contract between the two countries were forever set in stone as America willed: “you fund our debt for life, and we will give you military protection given you still need to repent for the sins of WWII”. The Japanese agreed.

“When you have a disruptive technology, they call it a category killer. Bitcoin is a serial killer – it’s going to go through 40 or 50 different industries” – Dan Morehead

When Nixon closed the gold window, the US had a debt-to-GDP ratio of 35%, West Germany was at 18%, and Japan was 10%.
Today the US is at 135%, the Eurozone’s at 91%, and Japan’s above 260%.

However, because this configuration bug hit very widely distributed software running in kernelspace almost universally across machines used by the workforce of lynchpin institutions throughout society (most relevantly to this column, banks, but also airlines, etc etc), it had a blast radius much, much larger than typical configuration bugs.

Like Americans in general, American Bitcoiners can be found across the political spectrum— but they tend to be moderates. Bitcoin owners tend to be younger and male, but are otherwise diverse. When it comes to race, ethnicity, income, education, and financial literacy, Bitcoin owners look much like the rest of the U.S. population.

“I’ve just become president of PepsiCo, and you couldn’t just stop and listen to my news,” I said, loudly. “You just wanted me to go get the milk!” “Listen to me,” my mother replied. “You may be the president or whatever of PepsiCo, but when you come home, you are a wife and a mother and a daughter. Nobody can take your place. “So you leave that crown in the garage.”

BIS had been created by the world’s leading central banks to administer German reparations payments after World War I, but it soon took on a life of its own, transforming itself into a pillar of the emerging global financial system.

On Putin:
Lyudmila did not know he worked for the KGB. He had told her, too, that he worked for the criminal investigations branch of the Ministry of the Interior. It was a common cover for intelligence agents, and he had even been issued a false identification card.

“In reality, it’s inevitable that overseas AI companies see Japan as a paradise for copyright violation and machine learning since unauthorised learning is continuing no matter how much illustrators are being hurt by generative AI.”

After Alexander proved the effectiveness of the Macedonian phalanx, it spread throughout the Hellenistic world and became the default military formation for centuries.
It only had one weakness…
When Rome invaded Macedon in 214 BC, they exploited the Macedonian army’s inability to maneuver while in formation and devastated their flanks and rear.

As Guidara went through these trying times, his father encouraged him to maintain a journal of his thoughts. Frank said: “Perspective has an expiration date, no matter how hard you try to hold on to it.”

Less than twenty years after the Perry expedition, Japan had upgraded from junks to steam-powered destroyers. In 1894–95, Japan easily trounced the Chinese up and down the East Asian coast in the Sino-Japanese War. In 1904–5, Japan conquered all of Korea while also sinking the entirety of both Russian fleets in the Russo-Japanese War.

That $175.3T lines up with the ~$200T number that Druckenmiller has been using for the all-in liabilities of the US government when you take everything into account.

More than defense, or social security, or anything else. The number one thing all tax dollars (and printed dollars) now go towards as of 2024 are payments to bondholders.

One of my formative experiences has been building our services constrained by what Apple will let us build on their platforms. Between the way they tax developers, the arbitrary rules they apply, and all the product innovations they block from shipping, it’s clear that Meta and many other companies would be freed up to build much better services for people if we could build the best versions of our products and competitors were not able to constrain what we could build. On a philosophical level, this is a major reason why I believe so strongly in building open ecosystems in AI and AR/VR for the next generation of computing.


“Italians over the age of 100 are concentrated into the poorest, most remote and shortest-lived provinces, while US supercentenarians are concentrated into populations with incomplete vital registries…”
5/n
“Both patterns are difficult to explain through biology, but are readily explained as economic drivers of pension fraud and reporting error.”

For example, Okinawa has the highest number of centenarians per capita of any Japanese prefecture and remains world-famous for remarkable longevity.”
7/n
”Okinawa also has the highest murder rate per capita, the worst over-65 dependency ratio, the second-lowest median income, and the lowest median lifespan of all 47 Japanese prefectures”

“Surveying the ‘blue zone’ of Ikaria, Chrysohoou et al. observed that the oldest-old have: a below-median wage in over 95-98% of cases, moderate to high alcohol consumption, a 10% illiteracy rate, an average 7.4 years of education, & a 99% rate of smoking in men”

By the time Vladimir joined, the KGB had grown into a vast bureaucracy that oversaw not only domestic and foreign intelligence matters, but also counterintelligence at home and abroad, military counterintelligence, enforcement of the border and customs, and physical protection of the political leadership and government facilities like the country’s nuclear sites. There were directorates that oversaw communications and cryptography, and that monitored telephone calls. The Sixth Directorate monitored “economic security” by policing speculation, currency exchanges, and other signs of deviant free-market activity. The Fifth Chief Directorate, created in 1969 to “protect” the Constitution, enforced party loyalty and harassed dissidents in all walks of life. The KGB was more than just a security agency; it was a state within the state,

Under Trong’s watch, the Politburo of the Communist Party, the country’s highest decision-making body, boasted an unprecedented large number of members with military and security background. Of its current 14 members, there are 5 with background in the security and police /7
forces and 3 with background in the military. As the Ministry of Public Security was the anti-corruption campaign’s key enforcers, its leader (now President To Lam) has become Trong’s most likely successor.

Under Trong’s leadership, Vietnam upgraded its ties with South Korea, the United States, Japan, and Australia to /11
“comprehensive strategic partnerships,” while also joining China’s “community with a shared future (a.k.a. “community of common destiny”). This was a great feat in a growingly divided region, as Vietnam now stands out as the only comprehensive strategic partner of all major /12
powers in the Indo-Pacific.

Here’s the last one.

Recent startup, tech, AI, crypto learnings: “The user is never wrong” — Larry Page

Here’s the last one.

The average return on a token that paid for media space on DexScreener was -50% over only a 24 hour period.
Heuristic: If someone is paying cash to make sure I see a token, it’s so they can dump on me if I’m stupid enough to pay attention.

Close to 3/4 of startups work fully remote — in Alliance DAO

Aggregations of opinion polls in the 1960s have shown approval of the moon landing was consistently lower than disapproval. One poll of astronomers showed a majority against the mission. Even President Kennedy’s own head of Science Advisory Committee – Jerome Wiesner – opposed a manned mission, releasing a critical report on the notion.
Popular opposition isn’t something you often hear about regarding the Apollo program. It is conveniently missing from America’s collective memory, in lieu of a tale of collective patriotic triumph. A narrative that pleases Democrats as an example of successful big public programs and Republicans, as a triumph of the capitalist west against the communist east.
47% said it was worth it a decade later, in 1979 and it would take 20 years for amnesia to set it and this number to reach 77% in 1989.

There are just 21 million #bitcoin after all… How scarce that number. There are something like 59 million millionaires in the world (not enough for all of them to hold even 0.36 BTC).

Josh Kopelman: VC is anti network fx. The more you invest the harder to help them

5 levels to AGI according to OpenAI:
1. Chatbots
2. Reasoners
3. Agents
4. Innovators
5. Organizations

Level 3 is when the AI models begin to develop the ability to create content or perform actions without human input, or at least at the general direction of humans. Sam Altman, OpenAI CEO has previously hinted that GPT-5 might be an agent-based AI system.

@feketegy
This is exactly my thought too, think of programming mainframes in FORTRAN or COBOL in the 70s then PCs with ASM and C in the 90s and now LLMs plugs into many languages giving context to code bases where there were none before.

The above figures are clear: There is almost no persistence in CEO performance. The observed number of CEOs in each category is indistinguishable from what we would expect if the process were entirely random

44% of Bitcoin nodes are currently at the chain tip (fully synced with the network), with an additional 48% synced within 5 blocks of the chain tip, resulting in an enormous 92.8% are synced within 5 blocks. Only 7.2% of nodes are more than 5 blocks behind.

While we kept plodding on the “pure dual-core”, Intel, still smarting from the x64 defeat just slapped two 1x cores together, did some smart interconnects, & marketed it as “dual core”. Joke at AMD was that Intel’s marketing budget was > our R&D (true fact). Customers ate it up.

We did launch a “true” dual core, but nobody cared. By then Intel’s “fake” dual core already had AR/PR love. We then started working on a “true” quad core, but AGAIN, Intel just slapped 2 dual cores together & called it a quad-core. How did we miss that playbook?!

Today ‘summarise this document’ is AI, and you need a cloud LLM that costs $20/month, but tomorrow the OS will do that for free. ‘AI is whatever doesn’t work yet.’

power is becoming the main constraint. US electricity production has barely grown in a decade
– the US could solve this with natural gas. we have abundant supply and could build out capacity fast (my note: i wonder if bitcoin miners can help this?)

algorithmic secrets are worth 10x+ more compute. we’re leaking these constantly
– model weights will be critical to protect too. stealing these could let others instantly catch up

Looking at the spending behaviour of long-term holders, it can be seen that although the spent volume by these players constitutes only 4%-8% of the total volume, the profits realized from this spending typically account for 30%-40% of cumulative profits realized over bull markets.

Every Wednesday morning, Amazon’s executive team gets together and goes through 400-500 metrics that represents the current state of Amazon’s various businesses. The meeting lasts 60 minutes, except for when it’s the holiday shopping season, in which case they sit together for 90 minutes. Amazon’s leadership meets for the Weekly Business Review every week, without fail, even when the CEO or CFO isn’t present. They’ve been doing this since the early 2000s.

The Amazon-style WBR is designed to answer three questions:
What did our customers experience last week?
How did our business do last week?
Are we on track to hit targets?

It is easy to trade social capital for financial capital. But while you can cloak yourself in blue-chip designers all you like to impress your fellow financiers, it is extremely hard to trade financial capital for social capital.
You’ve seen this with every washed-up celebrity you know: when the coolest people become rich, even they can’t remain cool.

Larry Page: the user is never wrong

Empower your employees to build their social presence.Tap into those audiences for key company announcements.Build a culture around this so that net new employees can replenish the distribution when people inevitably leave.

Reason Google took so long to build cloud service is because it was lower margin than ads. No internal incentives. Same reason Amazon did it so quickly — higher margin than retail, “your margin is my opportunity”

All this to say that I’ve shifted my thoughts from “crypto and web3 will absorb tradfi” to “crypto and web3 serve as the base layer for AI”
Web3 isn’t our internet… it will belong to the machines

Laffont / Coatue:
$100T in CPU / PC infra investment
Believes all this will be replaced by $100T or more in GPU infra investment — but quantum will be very small part of it

China has commenced operation of the world’s first fourth-generation nuclear reactor, for which China asserts it developed some 90 percent of the technology.
Overall, analysts assess that China likely stands 10 to 15 years ahead of the United States in its ability to deploy fourth-generation nuclear reactors at scale

1) Many international individuals decide to start their company in the US (for example Snowflake was founded by 3 French people but it is an American company) as there are fewer regulations (Europe is very complicated given different states have different laws)
2) Source of Capital: the US has an amazing venture capital environment with investors who can act quickly and are willing to lose capital. In Europe, raising capital is much harder and lengthy

In 5 years, it’ll seem bizarre that we ever allowed anyone to email or text or call us AND the norm was to at least think about replying to them. Being reachable 24/7 by anyone and for anything will have been a blip in time, an absurd anomaly in the long arc of the hyperconnected digital age.

This gave those labels a lot of power over Spotify, but not all the labels, just three of them. Universal, Warner and Sony, the Big Three, control more than 70% of all music recordings, and more than 60% of all music compositions. These three companies are remarkably inbred. Their execs routine hop from one to the other, and they regularly cross-license samples and other rights to each other.

As we pored over the code, we found that, although there were a few human women on the site, more than 11 million interactions logged in the database were between human men and female bots. And the men had to pay for every single message they sent. For most of their millions of users, Ashley Madison affairs were entirely a fantasy built out of threadbare chatbot pick-up lines like “how r u?” or “whats up?”

Value of information is the amount of surprise — information theory

Crypto’s trends from the ICO boom; to NFT summer; to socialFi, to memecoining, show me that people like to do their own research, get some sense of market advantage and then buy in size.

This past week we had one of the most bullish signals for the crypto industries with the SEC dropping its case against ConsenSys, alongside an imminent launch of the $ETH ETF. Despite this, $ETH has drawn down 12% from local highs, with majority of altcoins down anywhere from 10-50% in the past week when I first expressed this view.

Crypto-native positioning is more relevant for alts, where liquidity and thinner and % of participant that is crypto-native is higher. For $BTC and $ETH, the consideration is more PvE in nature vs PvP, and my believe are these two are still flag-bearers for the market, especially given the decimation in TOTAL3.

Podcast notes – Dylan Field (Figma founder) with Elad Gil – AI, crypto, his startup journey

Guest: Dylan Field
Host: Elad Gil

Started Figma at 20, Thiel Fellow

Did some great tech internships
Cofounder Evan was TA at Brown, most brilliant person he knew
Knew he could learn a lot from Evan even if it was a failure

Got Thiel Fellow – $100K over 2 years – enabled him to focus on Figma – no dilution, helped with network

YC is good for enterprise – sell B2B, get initial customers

// Elad – early YC Demo Days – only 10-15 angels in audience – had program to help educate angels

Useful to ask “why now” when you start a company
For Figma, in 2012, WebGL arrived, initially experimented with computational photography, then went into design
Thought it would only take 1 year, but took 2 – could have moved faster if they hired faster

Microsoft told them they had to start charging so they could spread it internally (at Microsoft) – knew then they had product market fit

Customer wrote 12 page document telling them what they should go build – another moment of product market fit – the market was there, was trying to pull product out of them

Never managed before Figma, it was tough as they scaled
Bringing first manager was catalytic – meant he could learn from the manager

// Elad: Bill Gates would hire COO, learn from him, then fire him and hire another one, learn from him, etc

Interesting areas
-people move in herds a lot – right now people excited about AI
-look for different under explored areas
-lots of good ideas out there – more important is find personal passion, if you’re 3 years into an idea you hate, you’ll burn out, happened with his friends

Thought he was late to crypto, but people tell him now he was early
Got emails in 2009 talking about bitcoin
In Thiel Fellowship – people were very excited about it (first bubble in 2013-ish)
Got more interested in Ethereum’s technology
Wife started crypto company Ironfish
They talked about crypto collectibles at time (digital items fascinated him)
He really liked to play NeoPets – virtual economy – felt exact same as Ethereum and NFTs
Buy things you’ll want to keep forever – only sold 2 NFTs in his life

Problems in crypto
-privacy very important – holding crypto is big security risk
-scalability taking off now
-regulation desperately needed – lack of it is blocking crypto’s advancement – especially in the US, crypto will move elsewhere if we don’t solve regulation

Every industry will be touched by AI
Pace is staggering
Completely new tooling method
Already world changing tech even if it stops improving
AGI is difficult to define – AI will make fundamental research contributions
By 2030, there will be AI co-author for pure math research journal

New version of Turing test – multiplayer AI – bunch of humans and AIs
// Elad – already happened with Cicero the strategy game

How will AI impact education
AI tutors and therapists will happen – but make it local not cloud based
Colleges are scared of ChatGPT – but if it’s copying essays and hurting education, isn’t that a deeper issue? You can already hire someone to write essays

University is multiple components – mating system, credentialing system, social club
As AI proliferates, credentialing decreases in value, social club aspect increases in value
// Elad – similar to what internet did to media – mid-tier outlets got hurt, big brands thrive
Wants online universities that are better than YouTube, more structured, more social

Don’t ignore power of a well-written cold email
Communities that were on Twitter are now going private
But find those communities, learn norms, be helpful
// Elad – help open source communities

Thiel Fellowship
Haven’t seen similar programs
Even Thiel applications, sometimes it’s hard to fill a class (of fellows)
Not enough people who are risk on, willing to drop out and commit

Doesn’t believe standardized testing is correlated with IQ as much as most of Silicon Valley thinks
Access to tutors, prep programs – equity component to this

// Elad – people who drop out to do startups, you gain an additional cycle of technology (eg, a few years of school, plus a few years of the first job), which is powerful experience

Still very focused on Figma
Interested in data visualization / doesn’t feel it’s done quite right

===

My friend and I started a crypto podcast called Two Degens. We talk about markets and share interesting links and sometimes invite guests. You can listen to it here.

“Artificial intelligence has the verbal skills of a four-year-old”

This was written in 2013.

Over the decades it has become apparent that simply throwing more processor cycles at the problem of true artificial intelligence isn’t going to cut it. A brain is orders of magnitude more complex than any AI system developed thus far, but some are getting closer.

And in the seven years since this post, we now have GPT-3, capable of writing essays at least as good as college graduates, on just about any topic that interests you, whether that’s cryptocurrencies or the history of feudalism or the chemistry of marijuana.

I’m not trying to single out this article. It’s just a powerful reminder of how difficult it is for anybody to properly assess current technology, because of our inability to fully grasp the effects of exponential growth and the surprises of non-linear innovation.

We keep trying to peer into the future, and we keep being surprised when the future actually arrives.

What else are we getting wrong about our technologies of today? What other technologies have the skills or experience of a four year old?

A few come to mind: Virtual reality. Blockchains. Robots (although this is increasingly not the case).

A very thoughtful long essay: Jeff Lonsdale’s 2020 predictions

Below are some of my favorite bits, and here’s the full essay.

A very small subreddit will have experts happily engaging with neophytes, while a place with a large commentator base will often put discussions around tribal dynamics first and foremost.

You can say things about people you could never say on Twitter or in blog format. This makes for a golden age of podcasting that might not last as long as we would like.

In a move called the yellow economy, protesters are using apps that lets them know which businesses are in favor of the protests so they can support them and ignore the so-called blue businesses that are owned by people who support the CCP and current establishment in Hong Kong.

There will be a continuing fight between governments who want cheap telecom technology and are willing to expose their infrastructure to the Chinese and those who want to stick to systems that implicitly allow surveillance by the US and its allies.

Korea already implemented a Cinderella law, doesn’t let kids under the age of 16 play between midnight and six o’clock in the morning. But that wasn’t enough for some mental health professionals in Korea, who saw games as a cause of problems among young men, and they lobbied the World Health Organization to add an internet gaming disorder to its International Classification of Diseases. The WHO announced in 2019 that it will include the disorder in the its 2022 ICD.

Making games is expensive, and anything that can be done to derisk games is going to be done. This isn’t new. Farmville, the first major success on social, was really just a remix of Harvest Moon. League of Legends is a version of Dota, modified to increase the twitch gaming and remove aspects that overly complicate the game.

One thing that has been underrated this past decade is that most people were only cancelled after they let themselves be cancelled. Trump is the politician who blew this open, he didn’t let any allegation, true or false, bring him down. The people most at risk from cancel culture are the individuals and institutions who have enthusiastically wielded the tools of cancel culture.

the court of public opinion is stronger than before and it is vital to come out swinging against false allegations that other people see as credible. Making a lukewarm apology and then disappearing from public life is the equivalent of ceding the field to your enemies. For those looking for a non-Trump model for how this plays out, Carlos Ghosn’s very public pushback on the allegations made against him by Japan’s prosecutors and Nissan will serve as a template for others who have been unjustly accused.