Larry Cermak - VP Research, The Block Ep #50

Larry Cermak joined The Block as one of the first employees with the mission to provide professionals with accurate information about crypto. He now leads a 30-person research team that delivers insights to institutional customers.

00:09 - Intro

00:20 - Larry Cermak’s origin story / His work at The Block

08:25 - The fundamentals of Bitcoin

16:03 - The value of SushiSwap

19:35 - Investing based on Memes

23:42 - Market Value for future gains in Crypto

26:12 - Will NFTs be backing internet money?

28:44 - Thoughts on Algorithmic Stablecoins

31:00 - Regulation in the US

34:47 - Decentralization and tokens in the context of regulation

39:45 - Volume of users / social networks

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Anatoly (00:09):

Hey folks, this is Anatoly, and you're listening to The Solana Podcast. And today I have Larry Cermak, who's the VP of Research at The Block. Awesome to have you, man.

Larry Cermak (00:18):

Nice to be on, it's a pleasure.

Anatoly (00:20):

Yeah, so tell me your origin story. How'd you get into crypto?

Larry Cermak (00:24):

Yeah, it's probably slightly longer. But really high-level, I got involved in late 2016, I was in college in the US and was thinking about what to do my thesis on and Bitcoin seemed like one of the more obvious options, to not make it incredibly boring, so I just decided to go with that. And throughout the research process, I just kind of found that there isn't good research about Bitcoin, just in general crypto. There was either the super bullish people that were like all in on Bitcoin, or super bearish academics, and there nothing in between, and I felt like I can fill the gap a little bit.

So after I published that research, I shared it publicly as well with a few people, and based on that I got my first job offer to work at Diar which is a research company, focusing only on crypto. So I worked there for a couple of years, and really just tried to focus on data driven research, which now it sounds kind of obvious, but back then it just wasn't very common. Most people were just looking at the really simple metrics and munging data, but mostly it was just price discussion, price predictions, all that stuff. And we were really looking at just analyzing the market a little bit more fundamentally, that sounds even more silly now looking back.

And I got lucky that in 2017 when I joined full time, like early 2017 I joined full time, and that's when everything popped off massively, and it was just a bunch of shit ICOs, like a lot of sketchy stuff. I consciously started looking more into these projects, so I was one of the people that were kind of cautioning against some of the ICO stuff, and it was a lot of fun but I was quite skeptical back then still. So actually, a lot of people who have followed me for a while, they know initially I was a no-coiner, I had no crypto, and I was convinced that initially actually that a lot of this is just kind of hype mania, it's just all like overblown massively. But something really drew me into it, and it was mostly the permissionless nature, ability for anyone to participate, but what really I didn't like was just the hype around it, the marketing, the emptiness, and all that stuff.

So I over-focused on that I think initially, but after some time, I realized that that's probably not what this is all about. Initially, I didn't think that it was necessarily important for most projects to have tokens and I was very skeptical that most tokens need a project, and I started massively changing my mind on this with the DeFi beginnings. So early 2020 my mind started completely changing on most of the space and I stared allocating a little bit more, and now I also do seed investing privately. And obviously, I lead the research department at The Block which is now 25 researches, probably the largest research team in crypto.

Anatoly (03:33):

So you went from Bitcoin skeptic to full shit-coiner.

Larry Cermak (03:38):

Kind of, yeah. It's a little bit concerning honestly.

Anatoly (03:42):

In four years....