Investing in the Decentralized Business of the Blockchain
Does the unique structure, support and development of crypto pose a risk to your investment?
That is the fundamental question to many investors. And it’s one Chris Coney and Marija Matic tackle in this week’s Weiss Crypto Sunday Special.
According to Marija, there are two aspects to this: how the projects are funded and how upgrades and changes are decided.
You can watch their interview here, or read on for the full transcript ...
Chris Coney:
Hi there and welcome to this week's edition of the Weiss Crypto Sunday Special with me your host, Chris Coney. My guest analyst today will be Marija Matic, back again; Marija, welcome back to the Sunday Special.
Marija Matic:
Thank you, Chris, for having me.
Chris:
Good to have you, madame.
So today, I want to talk about what I've called it the business model of blockchains. In truth, it's also going to be the business model of various decentralized apps (dApps) and so on. This is I think something that investors think about in terms of: It's not the same as regular equity investing, so does the different structure of crypto and the way it's supported and developed pose a risk to my investment? That is the fundamental question I think some investors have that I want to try and alleviate today.
So, I'll just set the premise here. The reason I was thinking about this topic is that this overlaps with the conversation I had with Kenny Polcari, which focused on this overlapping period which kind of started when, well, the technology revolution and the internet came.
So, we're moving from this society and these organizations that are built in hierarchies — like a traditional company with senior management and junior management and so on — to these more horizontal organizations that are more like hives. Now, we have lots of individuals that are collaborating. So that again is the representation of the way sort of organizations and society at large is moving.
And the whole crypto and blockchain thing is a brilliant facilitator of that because now you can have these worldwide organizations, like these decentralized autonomous organizations (DAOs), which is what you could say blockchain is. So with that becomes the reinventing phase of different models and what motivates people to participate in these organizations.
So, when I call this the business model of blockchains, well, funding needs to happen somehow, or an incentive structure needs to be there for human beings to expend their energy or the mental or physical to maintain these technology platforms.
In equity-based companies like Amazon.com (Nasdaq: AMZN) and Facebook Inc. (Nasdaq: FB), it's obvious. We know how that works: People buy the equity, or they work at those companies and get paid salaries. The salaries come from the profit the company makes providing a service that they charge for.
But how does it work when you take all the levels of management out and there are no owners?
So, let's begin with the big daddy, the originator: Bitcoin. There are different actors in Bitcoin like miners, like developers, like node operators. So why do those people do that and how do they fund the costs involved in those operations? Do you want to give us a bit quick tour through that?
Marija:
Well, yeah. Funding the of development of cryptocurrencies is done in many ways, but I think we could start from the largest one, from Bitcoin (BTC, Tech/Adoption Grade “A-”), and talk a little bit about that.
Bitcoin developers are, for example, funded in a decentralized manner and mostly by the companies that work in crypto as these companies have a lot to gain from strong Bitcoin fundamentals and usage. Some developers are working for Bitcoin core, some are testing, some are just the doing all sorts of work. And then we have these crypto exchanges such as Coinbase Global Inc. (Nasdaq: COIN), BitMEX, Gemini, etc., that have their own funds to support of the developers.
Chris:
Yeah. Because their businesses rely on Bitcoin, they have an incentive to protect it in that way.
Marija:
Yes. And it's also a sign of goodwill because it's expected by the community. The community sometimes asks these crypto exchanges or other groups and companies that push them to sponsor the development of Bitcoin.
Some developers are financed by human rights foundations that also have a Bitcoin development fund. Some are financed by Blockstream, by Square Inc. (Nasdaq: SQ). Then we have universities that are funding them, as well; some teams like MIT Labs or companies like Chaincode, etc. And many other companies and private donors that are sponsoring developers, as well.
So, as I said, the sponsoring of the development is expected by the community. If you're a crypto company, you would really want to do that as well, because your job and your business depends on strong Bitcoin fundamentals and usage.
Chris:
So, if you were a company like Coinbase making huge profits by using the Bitcoin network and providing services and didn't give back to the community by investing in the development, that might look bad. Right?
Marija:
Exactly. Yes. And what's most important is there is no single individual or company that governs the development of the Bitcoin project. Instead, you have individuals or teams across the globe that are able to propose or initiate upgrades. And these upgrades have to be peer reviewed by hundreds of developers who are actively working on Bitcoin projects. Depending on these reviews — if there any bugs, the method of implementation, etc. — this proposal gets accepted or rejected. Developers also have regular weekly online meetings to discuss development to synchronize, etc.
Chris:
Right. So there's some transparency there. So you're talking about the process by which Bitcoin is improved. You can submit a Bitcoin improvement proposal, write the code, submit it to the community, it gets peer reviewed using the truly using the scientific method. And because it's math and it can be objectively verified, whoever wants to in the Bitcoin scientific community can scrutinize that reply, report your thinking, show where the logic is flawed, and everyone can see that because all done out in the open. Right?
Marija:
Exactly. Everything's in the open, everything is known and anyone can review the proposals. And this is also very much discussed in the community, on social networks, among some very knowledgeable people, as well as those who have higher stakes in the outcome. Any kind of person can give their opinion and maybe sway the public opinion to other side. And sometimes it can happen that there is ... let's call it political disagreement.
This happened related to the size of the blocks. So, when the fork happened, we got Bitcoin Cash (BCH, Tech/Adoption Grade “C+”) and Bitcoin. So this is basically what is supposed to happen, or people can vote or miners can vote and it is what is supposed to happen. So people can sway the direction in which Bitcoin is going. And there is also a middle job in between pushing the... The people who are pushing the code are not the same developers that are proposing and testing and everything.
There is a job called the maintainer. So we have like, I don't know, I think maybe five or six known maintainers related to Bitcoin and this is not a permanent position. These are the people who are pushing the code. They have a very good reputation, but the community can choose to remove them if they really believe that they work against the community's vision of Bitcoin's future. And so their work is mostly kind of janitorial. They have to make sure that the project's code proceeds smoothly. But it's also critical as it can become a kind of centralized bottleneck. But even if they push some malicious code or whatever they do, the users are the ones who are free to choose which version of Bitcoin software they want to use.
So, even if a malicious code was pushed by maintainers, it would be noticed as are hundreds of eyes looking at the GitHub all the time. And so yeah, it would be noticed and it could be disregarded by the community and by the miners and nodes. And so that's why all the stakeholders and even maintainers have similar incentives to adopt and to protect the consensus.
So, it happened actually with Bitcoin. There is a site called bitcoin.org. And it's not the official Bitcoin's website, because a Bitcoin doesn't have an official website, but still it's regarded as some kind of authority and due to the illegal threats of Craig Wright. Maybe you've probably heard of him. He's the one who claims that he's Satoshi and sometimes he's really attacked by the community. So basically, he was the one to legally threaten the maintainers of the website.
And demanded they take down the white paper, which is like a technical paper, like a Bitcoin bible. So one of the maintainers got scared and he rushed it on the GitHub, where the community was voting and discussing it. So he quickly took it down. And This is problematic even though it couldn’t do anything to Bitcoin because it could happen again with a more stupid thing. So, this guy, he resigned as a maintainer. He realized that it was the wrong call, and it wasn't done in a proper way.
These are very smart people with nice reputation and everything. They don't want to risk it and still even if they did risk it, it all depends on the people and which Bitcoin software they want to run like the miners and nodes.
So there is no real risk to be honest in that regard. There may be, but you can always, whatever, in the end you can fork the coach if there is a difference.
Chris:
I found an interesting link there when we were talking about the scientific method. When it comes to reviewing the code, if there's a disagreement that cannot be reconciled, there's always the option of a fork, where you just take a copy of the code and launch a clone, call it something else and then let the market decide.
Now why I'm picking that up specifically is because this is a linking I never saw before. That's a way of linking the scientific method with free market capitalism. Because they can't all agree, they say, all right, let's let the market decide. And that's what moves into the free market. And they put both products on the market and say who wants to trade, say, BTC and who wants to trade Bitcoin Cash (BCH), for example? And then you just let it go. That's the ultimate scientific experiment, because if the science that's creating the products doesn't provide value to free market buyers as investors or users, then the science doesn't have any value in an economic sense. So that's something I never saw before, the link between the scientific method and then the ultimate scientific test is to put out to the economy and see if it sells or people start investing in it. So that's the way to resolve those kinds of rifts of consensus. You just let the crowd decide.
Marija:
Yes, that's what's interesting. This centralization, it's like nobody owns it and nobody owns the Bitcoin network. Nobody can really speak with authority in the name of Bitcoin. So there is always way to decide what you're going, where the community wants to go-
and how to grow. Ethereum (ETH, Tech/Adoption Grade “A”) has similar kind of development process with couple of different teams and things like that and it has probably the largest number of developers. I think maybe even hundreds of thousands, a crazy number, that are building on the platform and creating applications on Ethereum. So Ethereum has the largest number, the last time I checked, and they are building DeFi applications, things, games, NFT, projects, whatever. So yeah.
Chris:
That's as a good segue, because so Ethereum was the second crypto that was created, but it did have a slightly different funding model. Bitcoin was totally bootstrapped in a grassroots way, right? It was created, it was mined as a kind of just as an experiment to begin with and then started trading all the rest of it. But in 2015, when Ethereum was proposed and launched, they originally did sell Ethereum in exchange for Bitcoin. I don't know if you were around back then.
Marija:
Yeah.
Chris:
I think that when you went to the Ethereum Foundation, which is still around and pays a lot of developers' salaries and so on. So that's close to the way Bitcoin works, but not quite. I haven't heard yet, you can correct me if I'm wrong here, I haven't heard of any Ethereum developers being sponsored in the way that Bitcoin developers are.
Like BitMEX just came out today and it's going to set aside $100,000 to sponsor this guy to be able to work full time on Bitcoin software. So that means they're going to pay him a $100,000 to live off, but then he's going to develop Bitcoin code and give it away. So it's indirect, that space that we've been talking about in terms of who funds the Bitcoin development.
Marija:
The development of Ethereum is also quite decentralized. There are companies for whom it's almost like a badge of honor, if you as a company develop —
Chris:
Bragging rights.
Marija:
Yes. I mean, Vitalik does lots of things and his crew, the foundation, etc.
But when you mentioned Bitcoin developers, there are many who are working for free. You don't have to... You can be completely anonymous and be involved in the development of Bitcoin. You don't have to reveal your name. Anyone can start by testing the code, checking and things like that.
Chris:
Sharing the results with the community.
Marija:
When you get noticed and when you contribute some nice things to Bitcoin, when they see that you're dedicated and valuable member of the development, someone will eventually or potentially approach you and say, okay, you've been great so we want to give you a grant for the things which you already did or maybe if you want to develop this and that, we will help you out.
Chris:
But that's where it's a true meritocracy though. It's absolutely brutal in that only people who really come with the goods and the results, who have hard science backing up their work are the ones that get those grants in the end. Because if you're just spamming with a load of junk nonsense, the people who really know what they're talking about won’t take any notice of you. So, there's none of that.
Marija:
Yes.
Chris:
But I mean, I suppose if you've got hundreds of billions of dollars on the line, I bet I'd be pretty ruthless in that way.
Marija:
Yes. And I think it's very important it stays this way. Like for example, we had an issue with Uniswap (UNI) a bit ago when they restricted derivative tokens and Synthetix (SNX) assets from their website The point is it's like what they said, okay, we had to restrict it because there is a regulatory uncertainty about these types of tokens. And since the website is something that is registered on real people, real companies, they don't want to be liable. So they have to kind of restrict the access.
Now, that doesn't mean that the smart contracts of these tokens have been deleted from blockchain, because they don't have the power to delete it. They cannot just remove it from the blockchain or anything. It's just a space on the blockchain and it can be accessed by any kind of third-party decentralized application which already is using it, or each can be if you make another interface to access Uniswap smart contracts, you can trade it.
But this was a kind of a call for community to get involved and be involved in the future. For example, when we are talking about development, it's Uniswap that started the Uniswap blockchain and Uniswap token, UNI. But there is now a huge war chest, billions in a treasury of Uniswap because a small piece of each trading fee on Uniswap goes to the treasury and this very large treasury is dedicated to the future development. And most of the DeFi applications are built in this way to have decentralized autonomous organization. So basically, it takes a part of the fee, puts it into the treasury and allows holders like me, anyone who has tokens, to vote on all the proposals on different proposals related to this money which is in the treasury. So we can decide how this money is spent. Development will be more and more decentralized because now we have like 50 grants already out, or 100 or 200 grants already out.
And already some people working based on those requirements or grants, so it's quite interesting because this is the process how the development will get decentralized.
And not just development, actually. If the war chest grows significantly, I think it's going to be the equivalent of $20-$30 billion worth of treasury in Uniswap very soon. Voters can decide, okay, we don't need all this money for development. It's crazy. We're just going to airdrop all the users again with some of the balance, because this is not money, this is not fiat. These are cryptos, tokens. These tokens can be given to holders or given as rewards for whatever is done on the platform or a number of different possibilities.
Chris:
The UNI treasury though is denominated in Uniswap tokens, right? So the treasury isn't dollars, it's a number of UNI tokens, right?
Marija:
Well, depending on the treasury, yeah, it's usually the token of the platform.
Chris:
Right. So with that, that means that the kind of the cash value of that treasury depends on the fluctuating price of the asset?
Marija:
It is fluctuating, but it's because there are so many people using these large product platforms, it's kind of always gross. I think for other, there's like $1 billion worth of treasury now. These treasuries are growing very, very fast because people do use these platforms and are paying fees for using them.
Chris:
Well, that's the positive feedback loop, right? Because if the people holding the token vote for good proposals that add value, you would expect that to cause the platform to grow and then pay back to the treasury in an upward spiral. And then more money is spent improving the protocol and more users come in, the treasury gets bigger. So, it kind of feeds itself, if the community are making the right decisions about which way to develop the project.
Marija:
Yeah. Well, community has been ... So far from what I've seen, there's always like a core community which is more involved in proposals in quite knowledgeable; there are very active people around any community.
Chris:
The groupies.
Marija:
Yes. The groupies. But these are very, very knowledgeable people who know things and it's always kind of ... So far, it has been shown that we are still in experimental stages of blockchain governance. And we still don't know the participation of the voters will be large enough. How can we set the right limit for a minimum participation for the proposal to be proposed or accepted? That’s not even considering barriers to voting. Because, I mean, still people, especially on Ethereum, have to pay the fee and not everyone is ready to pay a $10 fee just to give a vote.
Chris:
Like on Uniswap, what the person will say.
Marija:
Yeah. Let's say on Uniswap proposals. The thing is not many people will, but governance with the scaling of Ethereum or on another networks, it's much easier to vote on everything when it's almost cheap. And it will become like that on Ethereum soon with all these scaling solutions.
So the thing is, so far we the most active governance projects around Ethereum and we maybe didn't have the right picture, the right image of the participation level and the level of people ready to commit so much money in order to vote. But there are so many different models, like the delegating to the delegators and core voting for you, things like that.
Chris:
That explains the exponential innovation though, doesn't it? The fact that it's all permission-less means all these various funding models are being experimented with in real time out in the open.
Marija:
Yes. It's very interesting. For example, we had on Uniswap problems reaching these limits for accepting the proposal. There was a long gap between finally managing to gather so many people to vote and to passing this threshold when the proposal can be accepted. And it was funny because so many people wanted to lower the threshold, but the first voters couldn't even reach the threshold to lower it even though people wanted.
All these little things, everything's all experimental right now. And it's quite interesting because also for people who are interested in politics and history and governance in these things because this is pretty much a glimpse into future of how organizations will look. Well, at least a lot of organizations.
Chris:
But it's totally fluid though. Isn't it? It's almost chaotic in a way, but it's organized chaos as a cliché.
Marija:
Well, it looks like. Yeah, looks like it's chaotic, but in the end it's not so chaotic.
Chris:
But there is a structure though still?
Marija:
Yeah. There is a structure. There is a structure and everything is hard-coded, which is very important. And no one can really [act independently]. There are systems like maintainers who have the right to push the code, like in DeFi projects. and you have 24 hours to review it. You don't have to vote, you can just withdraw your funds from the platform if you don’t agree with the changes. But there is time for people to alert each other if some serious things are to be pushed to which haven't been properly vetted or things like that.
Like for example, there are different systems. And the systems related to the safety of the development of pushing the code are also experimental. And we are still kind of early in the building the best governance and safety practices around the crypto projects. And we are taking these risks. And it's quite interesting to see all this going on and so many smart people involved in it and it's quite good, it's quite interesting.
Chris:
There are lots of people and there was a note I made earlier on about this is kind of it's crowdsourced. We know what crowdfunding is — where a large group of people fund a small amount to a project. But crowdsourcing the development allows anyone with the expertise to contribute to a project and engage as shallowly or as deeply as they want to. And you can also be totally known or totally anonymous in the way you described earlier on. So I could go from totally anonymous, contributing an hour a month of my time, just to do a little test and submit that to the community, or I could go the other way and be totally known expert in the crypto space, working on it full time — either as a grant or I could be working for Coinbase and then my spare time — or donate some time as a hobby to the project, which doesn't have to be Bitcoin. It could be anything.
So this is the total fluidity of it and why it doesn't all have to be funded with cash money because someone who is a programmer at Coinbase, working on Bitcoin during the day, could spend a few hours a week in their spare time just for fun working on the Bitcoin code and that gets put into the global Bitcoin system. And if thousands of people do that, hundreds of thousands, and there are hundreds, millions of developers around the world, all that intellectual capital is being invested, I say for free but those people do as a hobby will get satisfaction from it, which is interesting.
Marija:
They do it for satisfaction, for glory, because they are interested, because they believe in it. So there are many reasons why people go for it, but it's super cool when they do.
Chris:
A million reasons why you could do it that we mentioned earlier. You might do it as a resume booster. The important thing is not just what suggestions you make. If you get one of your suggestions actually committed to the Bitcoin code but it actually makes it into the software that gets released to the world, well, that's like a badge of honor for the rest of your career. You can then go to Coinbase or their competitor and say, “I've just had a commit to the Bitcoin code. You need to hire me for double my salary or something.”
Marija:
Yeah. So you can say, “I found a bug in this and that proposal and I protected the network from a malicious proposal.” I don't mean malicious, but imperfect proposal. Or you can, I don't know, create a new standard of tokens on Ethereum. There is ERC20 standard of tokens you can create. There are many standards, but you can create some special token with special features which are good maybe for, I don't know, a special type of gaming or whatever. So there are lots of things that people can do and it's quite interesting. And it's, as you say, it is definitely a CV booster and it's beneficial to the community.
Chris:
Absolutely. Cool. Well, I think we should wrap it up there. I think we've covered most bases there at least once. So I'm just checking my notes if there's anything else. Now that we've done with Uniswap which is one of the ones I wanted to talk about in particular. So have you got any other comments before we close? We could go deeper into the topic, but I think we should leave it at that level.
Marija:
Oh yeah. It's very deep. Well, yeah, you mentioned at the beginning about the value accrual, tokens and cryptocurrencies, what is the value and how we can kind of measure it and how do cryptos create profits and things like that.
So, it depends on the project, but this is maybe the most complicated thing for people who are outside crypto to understand’. why are tokens valuable? To people who are not miners, Bitcoin will not directly give me a reward. So, the transaction fees of Bitcoin that are generally considered the total volume of the transaction fees, or rather how much people are willing to pay in order to use Bitcoin.
This kind of gives it value because it shows the usage and how widely used it is. Although some people may not see that way, but this is the Layer-1 blockchain and this is how its value is considered and looked at. And there are also projects are part chains. For example, you have Polkadot. There will be a demand for Polkadot because if there will be projects to kind of... That want to become part chains.
And then we have more autonomous networks that don’t require you use their token. You can become their side chain, part chain, whatever or part of their ecosystem without using their Layer-1 token for transaction fees. And these projects are more difficult to accrue value for because you can opt out of using their token
Ethereum is the other way, for example. Ethereum says, okay, you can create your own token, we don't care, but you have to pay the fees in Ethereum. So there are these value accrual things, models that investors can think about. But also if you're more autonomous or a Layer-1, the your safety of your chain will depend on their own.
It's not going to be so much shared safety. You will have to take care of your own safety, etc. So there are trade-offs always regarding the value accrual and other things. So, if you are a project that wants to build a platform, a decentralized application on a Layer-1 or whatever, you have to think about these trade-offs and what you actually need. Do you need to more safety? Do you need your own token? Do you need a token that will better capture value? It's not just a governance token; it also has certain utilities. Like the ETH governance token has some utilities like it can get some discounts or you can get more for your collateral or things like that. If you hold it and you want to lend, borrow on their platform.
Chris:
You just remind me of something there, the point about all these applications building on Ethereum are actually helping to add value to Ethereum by creating demand for the currency. You pay the transaction fees in ETH. Great. But then where does that leave the platform tokens?
Well, here was an Ethereum improvement proposal. This may have been included with the recent London hard forks and — don't quote me on this — there was one Ethereum improvement proposal that would enable you to pay Ethereum transaction fees in any token. Now, how they’ll pull that off technically, I'm not sure. Clearly there would be difficult. If I want to pay my transaction fee in other tokens, so I go on Ethereum wallet and only has 100 RV tokens in it and no Ethereum. Ordinarily, that would break that wallet. You wouldn't be able to do any transactions with it until you transfer some Ethereum to it to pay the transaction fee.
But in this proposal, if it got accepted, you'd just be able to send the 100 RV and it would work out how much of that would be, charged at the transaction fee. Now, the miners probably don't want the RV token, so I'd imagine so there's going to be some conversion in the background somehow. So then the miners end up with the Ethereum because they don't want a bunch of this and that tokens that they can't monetize.
Marija:
Yeah. Well, the thing is there are solutions being built already for these kinds of issues, so we are kind of getting there.
Now, important things are happening, like scaling solutions are going forward. We started with the kind of side chains and the commit chains. Now we are going into the roll ups. And these are now being tested on a large scale or they’re starting small and then will get larger and so on. Everything is still in the development phase and experimental phase. We are moving forward. But these things, even if there is a solution as you said with the conversion done in the background, you would need processing fee for that with things like that. There are different solutions, different things that are being built.
But for example, you have Cosmos (ATOM) which has projects such as Terra (LUNA) and you can. LUNA decided to give transaction fees, trading fees. All the people who are using Terra have to pay transaction fees in LUNA. And now, instead of burning this LUNA, they are going to give it to holders of LUNA who are also staking LUNA. So, this is a kind of thing that looks kind of like traditional finance, where you are a shareholder and you get dividends depending on the usage of how many trading is ongoing and how many fees are people ready to pay to use the platform.
Chris:
Except though, that would be like holding shares of The Coca-Cola Company (NYSE: KO) and getting paid your dividends in Coca-Cola stock.
Marija:
Yes.
Chris:
Which is slightly different, but —
Marija:
But for example, Cosmos is autonomous. You don't have to use ATOM for transaction fees if you have a project built on a Cosmos, so you can have your own token and that fee can be paid in your own token. So, this is good for that kind of thing.
Chris:
What about the revenue models on Ethereum that aren't possible yet because of what you're talking about regarding transaction fees and the speed of the network which just doesn't allow things like —
Marija:
Yes you can. Yes, you can. A portion of the trading fee on your platform. So, it's not the same as Ethereum transaction fee. You're paying two fees. One is to the miners to process that transaction, but then you're also paying to the platform. You're paying to an Uniswap to use it. Well, actually some part if it goes to the liquidity providers for offering their liquidity and another part is to the platform itself. So basically, there is a lot of value being created for lots of different people.
Chris:
Because that'll be like, in that case with the Uniswap, it will be a liquidity provider fee, a fee to the token holders and then a fee to the Ethereum network.
Marija:
Basically. If you're a voting, you can say, okay 0.25% or 0.1% will go to whatever and this percentage will go to whatever and this percentage will be burned. So we want to reduce the supply of blah blah blah. So the thing is like there is money, there are fees that you can use their value that can be considered as a value crop.
Chris:
But you can only slice it so many ways though. So, there's a million dollars a day in fees available. Well, there's only that to divide amongst however many parties. And as you change the size of the segments, you change the incentives for that group. So if you reduce the fee for liquidity providers, that's a disincentive, but now it's a more of an incentive to hold the UNI token, but then you mess about with it and see what the best balance is.
Marija:
Yeah. Exactly. These are the things that voters or the holders of the token have to decide on. They will say we have to kind of... These are the decisions that have to be made.
Chris:
With the decentralized governance systems on the tokens to vote?
Marija:
Yes.
Chris:
Exactly.
Marija:
Some of the decisions. Or you can just say, okay, let's just airdrop everything to every holder. No, I'm joking. That's not always the best approach, but yeah.
Chris:
Yeah. So that seems pretty universal amongst all the blockchains and smart-contract applications. That seems pretty common.
Marija:
Pretty common. Yes.
Chris:
Yep. And that creates the incentive for them to improve the platform and vote on good proposals.
Marija:
Yes.
Chris:
Yes, exactly. So that's the primary way a lot of these tokens accrue value. And then I think beyond that is anyone's guess.
Marija:
Yes, since a lot of them, almost all of them, are kind of governance tokens. Bitcoin is not a governance token because you cannot vote with one Bitcoin for anything. If you have machines, you're working with your hash power. It's a different kind of voting, but yeah, there are aspects that are governed and we as investors are always looking a bit further from the governance. Like okay, if it's just the governance, what is the chance of these voters voting on what will be done with the profits? How decentralized is the development? How decentralized is the voting or the token holders or whatever? So there are many things that you have to think about when you're to invest.
Chris:
There we go. All right. We'll close it there Marija. Thanks very much for being on the Sunday Special once again.
Marija:
Thank you, Chris.
Chris:
Take care.
