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How it started: People thinking everyone in crypto is an idiot...

by Adam Goldberg
on

Even before we created Standard Crypto, we always knew it would be a wild ride

Navigating the ups and downs of crypto takes a long view — and great partners. (Images credit: Midjourney) 

Strangely enough, it all started in an Uber. My co-founder Alok and I first met in person five years ago in San Francisco at a crypto happy hour during the height of the ICO bubble. As two of the very small number of VCs who would even contemplate investing in crypto at the time (me at Lightspeed, he previously at Benchmark), we knew of each other by reputation.

As we shared a car from one event to the next, we soon found common ground. We’d both been deeply immersed in the space for years, and our discussion was refreshing compared to the often muddled quality of thought at that time. We shared a long-term belief in crypto, and, while we didn’t agree on everything, we both believed that it was the future of the internet, marketplaces, and money itself.

When you go all-in on crypto, you get used to people either telling you that you’re a visionary — or that you’re an idiot for leaving your previous, stable job

People used to think we were completely crazy back then. Now they only think we are kind of crazy :).

Alok and I started Standard Crypto in 2019. When you go all-in on crypto, you get used to oscillating between periods of people either telling you that you’re a visionary — or that you’re an idiot for leaving your previous, stable job. (Insert hot startup, top-tier VC, or prestigious TradFi institution here.)

And even though it’s been a tumultuous year and crypto can seem like it’s off its rails, our beliefs hold firm. We still believe that crypto is the future of the internet, marketplaces, and money itself.

But hope isn’t a strategy. After a market cycle that exposed both the best and worst of what crypto offers, I’m reminded of something else about that ride that felt important: A principle which our firm has come to call pragmatic optimism. A shared belief that crypto will change everything — eventually. But it will take time. As our former firms and mentors always taught us, being too early is the same as being wrong. It’s a difficult balance, but we’ve come to learn that founders need a combination of unwavering belief and steely realism.

Which brings me to one of the reasons for this “state of the union” type missive. Up to this point, we’ve been fairly quiet, keeping our heads down and partnering with some of the most visionary founders and communities in all of crypto, supporting them in realizing their ambitions. (If you’re curious, you can see much of our portfolio here.)

But as we enter 2023, crypto is being inundated with so much noise that it can be hard to see clearly. All that media attention might make a perfectly reasonable outsider think that all crypto is bad! So it is time for us to be less quiet.

Crypto “OGs” often look down on those who joined the space later than they did. And we’re definitely seeing many of the newer crypto “enthusiasts” fleeing as swiftly as they came. But we must remember our purpose as collective shepherds of crypto. One of the trickiest parts of our job is to educate the huge variety of stakeholders who are far more intersected than those found in the traditional tech industry. Crypto needs a continued influx of new people and institutions.

The industry needs positive and principled voices to help steer it forward. We are fortunate to work with highly-focused true believers and innovative builders every single day. They recognize the greatness of crypto. So do we. We feel it's incumbent upon us to help highlight those individuals and communities.

We endeavor to be one of those voices.  


So why is it that our confidence in the sector is unshaken? Is it that we are still crazy?

I finally had the chance to take a step back and reflect on where crypto is and why we still believe in it. It is jarring and simply disappointing to hear about the alleged crimes committed by some of crypto’s very own.

Is crypto about money or technology? The answer is simple: Both. DeFi presents the first time we’ve truly seen finance operate at the speed of software

The dips of crypto’s market cycles are painful, but, ultimately, healthy. It is through this process of intense attention and attrition that the highly-focused true believers and innovative builders make their greatest strides forward. Engineers especially are often encouraged by less hype: They can put their heads down and build without distractions.

When two worlds collide: old finance and new tech

Conviction matters. To succeed in crypto you often have to break glass. I’m not speaking of shirking responsibility or advocating anything amoral. Rather think of it as shattering long-standing concepts in business that are built around artificial constraints. Crypto allows us to rethink the very construct of a company. To reimagine how marketplaces acquire, incentivize, and match users. To think about a JPEG as not simply a collection of pixels, but rather as membership to a digital experience.

People often ask me: Is crypto about money or technology? The answer is simple: Both. This is the first time we’ve truly seen finance operate at the speed of software. So it naturally attracts  scammers and charlatans. But it also brings the visionaries, dreamers, and builders, who dare to re-imagine finance, consumer apps, and the very construct of money itself.

We share those visions and dreams. And we're building ourselves. Today Standard Crypto has grown to a dozen people, and we plan to continue adding to the team.

All those years after that ride in an Uber, Alok and I still believe that crypto is the future of the internet and marketplaces. And we are still all-in.

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Disclaimer
This post is for general information purposes only. It does not constitute investment advice or a recommendation or solicitation to buy or sell any investment and should not be used in the evaluation of the merits of making any investment decision. It should not be relied upon for accounting, legal or tax advice or investment recommendations. This post reflects the current opinion(s) of the author(s) and is not made on behalf of Standard Crypto Management LP (“Standard Crypto”) or its affiliates. The opinions reflected herein are subject to change without being updated.