Last week, I had the pleasure of interviewing Anthony Sassano on the Ben & Bergs podcast. Anthony is a passionate educator on all things Ethereum. He also does some angel investing and advising. Below are my two main takeaways from the interview.
Key Takeaways
- Lots of crypto metrics are easily gameable, and, unfortunately, they mislead countless investors. For this reason, transactions per second (TPS) is “one of the worst metrics,” in Anthony’s opinion.
- It’s important to be open to the fact that the next bull market may not last as long as everyone expects. Next year, it will be crucial to routinely monitor for signs that the bull market is ending, rather than just assuming the expected timelines will play out.
Gameable Metrics: ‘The Hardest Thing In Crypto, By Far’
I’ve always found it unfortunate how many crypto investors, particularly new ones, are easily persuaded by specific metrics. Oftentimes, these metrics are their main reason for deciding to invest in a certain cryptocurrency.
In light of this, I asked Anthony to share the metric that he sees investors placing too much weight on. His answer: transactions per second (TPS). (His answer starts at 10:13.)
There is a difference between theoretical TPS and real TPS. Theoretical TPS is what someone tells you that the chain can do. So if someone says, “our chain can do 10,000 transactions per second,” but it’s actually doing 10 transactions per second, how can you believe that it can do 10,000?
To be clear, I’m not saying crypto metrics are meaningless. What I am saying is that you need to be mindful of how easily gameable various metrics are. By knowing this, you’ll be less likely to be deceived by projects and evangelists who point to numbers—theoretical or otherwise—in an effort to build legitimacy.
For what it’s worth, Anthony believes that fee revenue is one of the most manipulation-resistant metrics, given the economic cost involved. (While I agree with his reason, keep in mind that Anthony is all in on Ethereum, where more importance tends to be placed on fee revenue than other blockchains such as Bitcoin and Solana.)
The Case For Compressed Market Cycles
It was refreshing to hear Anthony share his unique prediction that the next bull market won’t last as long as it typically does. Even if you disagree, it’s worth listening to his take. (This section starts at 41:35.)
At the start of the year, Anthony believed, like most others, that the standard four-year market cycle would unfold. However, he’s now more open to the fact that this bull market could be roughly three months shorter, due to BTC’s price having surged past where he expected it to be at this stage of the cycle. (The cause of this rally, of course, has been the heightened anticipation of a spot bitcoin ETF approval in the U.S.)
Ultimately, I think he’s overcomplicating it and am still more in favour of the typical four-year cycle unfolding. That said, his argument has put me on notice to monitor for signs of the bull market running out of juice earlier than the consensus forecast. This is something I encourage everyone to be doing as we (presumably) advance deeper into the bull market next year.
Recap
Those are my two main takeaways from interviewing Anthony. He shared plenty of other insights and lessons in the discussion, so I encourage you to watch or listen to the whole episode. As always, ask any questions and I’ll answer when possible below.
To hear more from Anthony, click through below for my interview with him from August last year and subscribe to The Daily Gwei on YouTube.