I’ve been building Credit Coop, a new private credit platform supporting the growth of the Web3 ecosystem by providing innovative financing solutions that leverage future cash flows.
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The Index Coop is pleased to announce that the Data Economy Index (DATA) is now available for purchase through the Index Cooperative!
The DATA index is a basket of 7 tokens designed to provide accessible, passive exposure to the second largest Web3 sector, the data economy.
The index is represented by a fully collateralized ERC20 token and is available for purchase on Sushiswap, Index Coop, and TokenSets.
In this post, we will cover:
What is the Data Economy?
Why buy the DATA Index?
How to buy DATA
Methodology and maintenance
At the beginning of 2021, Thomas Hepner published an essay—winning the Index Creative Challenge along the way—explaining why he was investing in the Index Cooperative’s governance token ($INDEX). Since that post, the Index Cooperative’s revenue has grown nearly 14x and INDEX has increased in value nearly 5x.
This article expands on the bull case made in that essay with a subjective probability-weighted scenario analysis. I arrived at an expected value of a $51B market cap, implying a 190x upside from here. If crypto succeeds at absorbing any significant portion of the global financial system, I believe the Index Cooperative will likely be extremely profitable, generating billions in annual cash flow.
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Token Terrier believes that the likelihood of Ethereum's bull case is 50%+ and Bitcoin's is 80%+. In 10 years, we believe it is not only plausible that Bitcoin and Ether will both be $30T+ assets, but actually the most likely outcome.
Bitcoin as Digital Gold and Ethereum as a platform for decentralized financial (DeFi) applications are not just narratives; these two use cases require fundamentally different blockchain consensus mechanisms, Proof of Work (PoW) and Proof of Stake (PoS), with different assumptions about security and scalability.
In the long-run, there will likely be only one dominant Proof of Work blockchain, the Bitcoin blockchain, as well as a myriad of Proof of Stake (PoS) blockchains, anchored to Bitcoin's Proof of Work, of which Ethereum will be the most valuable.
Bitcoin and Ethereum are creating a financial system closely resembling that which existed in the United States under the Gold Standard from 1834 to 1933. During that era, gold was the sole arbiter of financial value, but relied upon a distributed banking network to scale its transactional capacity. Bitcoin will likely serve as Digital Gold and Ethereum as the world’s Banking and Financial Network in the emerging Network Age.
Token Terrier believes that Ethereum will become the dominant platform for DeFi applications, a market worth between 2% and 3% of global annual GDP, making Ether a $30T+ global transactional currency.
Bitcoin and Ethereum are the two highest conviction assets in the ₿EST Portfolio.
I do not think it’s hyperbolic to say that 2020 changed everything. I cannot think of a year in my life that was more transformational for not only myself in both my personal and professional lives, but also for our entire civilization, than 2020. It was so transformational that Peter Thiel called it the "first year of the 21st century" and Tyler Cowen asked “Is the Great Stagnation over?”
I wrote in the Purpose of Wealth, that in spite of the death and suffering experienced by millions, 2020 was a year of miracles in a nation of miracles. I now believe that the Great Stagnation, which has lasted for 50 years, is giving way to an Age of Miracles.
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Despite becoming 10x more bullish on Ethereum, its relative size within the BEST Portfolio has remained unchanged. Instead, incremental funds have been invested in the DeFi Pulse Index (DPI) and Index Cooperative (INDEX). On December 12th, I invested ~2% of the BEST Portfolio in DeFi Pulse Index (DPI) and ~1% in Index Cooperative (INDEX).
Ethereum (ETH) Thesis: Ethereum will absorb the vast majority of the world’s financial transactions in the 2020s. My expectation is that Ethereum will be worth over $1 trillion by the end of 2023, a 12x return potential.
DeFi Pulse Index (DPI) Thesis: DPI is the S&P 500 Index of Decentralized Finance (DeFi). DPI is a decentralized index for the nascent DeFi industry. I believe that DPI has the potential to return over 100x by the end of 2023.
Index Cooperative (INDEX) Thesis: If DPI is the S&P 500 of Crypto, then Index Cooperative is the Vanguard of Decentralized Index Funds. I believe that the governance token of Index Cooperative, INDEX, has the potential to become worth $100 billion over the long-term (10+ years), a 2,000x return potential from its current valuation.
I usually write about creating and growing wealth, but I’ve never written about why I believe it to be a worthwhile pursuit in the first place.
I believe wealth is valuable because time is valuable and wealth is stored time that can be used in the future. When we save or invest our hard-earned income, we are parting with our time in the present with the expectation that we will have more or better time in the future. The money we save and invest beyond our basic needs of survival is wealth.
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The United States is on the cusp of a historic Economic Boom!
It’s Official - The Bull Market in Housing has Begun!
Inflation will likely surge in the second half of 2021
The New Bitcoin Bull Market: DeFi, Corporate Treasuries, and Retail Adoption
Ethereum: A New, Digital Constitution?
(Decentralized) Prediction Markets Conquered Pollsters in the 2020 Presidential Election'
Personal Note: I caught a giant Chinook (King) Salmon in early October!
In this post, I discuss the following topics:
Twitter and the Aggregation Theory of Investing
The Rise of Gold
Bitcoin’s Total Addressable Market (TAM) is Growing
A New Bull Market in Housing?
Decentralized Finance (DeFi) is Booming on Ethereum!
Stock prices have risen due to inflation expectations, not the prospect of a swift recovery.
From my employer, PrecisionLender: Middle Market Loan Volume Has Crashed
My bet is that the US economy will undergo a “swoosh-shaped” recovery that lasts 2 to 5 years.
Google search interest for the 2020 Bitcoin halving was over 10x the 2016 halving.
It feels like more has happened in the past 3 weeks than in the past 3 years.
I believe that decades from now history will recognize the Coronavirus Crisis as the trigger that ended an era and began another.
History is being made now.
Read MoreIn May 2020, the long-anticipated halving (aka The “Halvening”) of Bitcoin’s block reward will be triggered, reducing the number of bitcoins mined from 12.5 to 6.25 per block. This will reduce Bitcoin’s inflation rate from ~3.7% to ~1.8%, below that of the US Dollar and only 0.3 percentage points higher than gold. Bitcoin will be nearly on-par with gold as the “hardest” money in all of human history; it will become more difficult to produce a new Bitcoin than an additional unit of any other currency except gold. Unlike gold, Bitcoin is vastly more divisible, portable, durable, recognizable and highly resistant to seizure.
Within 2 to 3 years, I believe that increased market confidence in Bitcoin’s true scarcity will cause its network value (aka market capitalization) to soar from approximately $150 billion today to between $1 trillion and $3 trillion as predicted by PlanB’s stock-to-flow model. This implies a price of $50,000 to $150,000 per Bitcoin. New demand for Bitcoin will come from a Millennial savings boom, a marginal shift in global demand from gold to Bitcoin, and investors starved for yield in a world saturated with over $15 trillion in negative interest rate debt.
The massive flow of value into the Bitcoin Network will enrich HODLers who will use their newfound purchasing power to fund innovations that will influence the broader world.
Read MoreSince President Richard Nixon took the United States off the last vestige of the Gold Standard in 1971, gold has actually outperformed the S&P 500 index in nominal terms.
In the 50 years ended January 2020, the price of an ounce of gold in nominal dollar terms has grown at a 7.7% compound annual rate whereas the S&P 500 index has grown at a 7.6% compound annual rate over the same time period.
Why does nobody know this?
Read MoreIn an Aggressive and Thoughtful Approach to Investing, I outlined the principles used to construct my investment portfolio for maximum capital accumulation. In this post, I describe the current and two most likely macroeconomic environments that I believe investors should prepare themselves for.
I believe that in the 2020s we will either experience the return of stagflation for the first time since the 1970s or the greatest economic boom since the late 19th century. It is even possible that both scenarios could occur within the same decade.
Read MoreDefinite Optimists are empowered by a way of seeing the future that maximizes their agency as individuals. Just as importantly, the courage and conviction with which Definite Optimists pursue their plans inspires the rest of us as to help make their visions become reality.
The great visionaries of our time, the people who truly move us, Elon Musk, Jack Dorsey, Vitalik Buterin, and Satoshi Nakamoto are all Definite Optimists. Their conviction in their visions of the future moves the rest of humanity to help them succeed. These visionaries are more leaders of movements than managers of companies.
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It may seem crazy, but I stopped saving for retirement, and started investing for maximum capital accumulation. This has led me to construct an unorthodox investment portfolio based on a set of principles, convictions about specific assets, and beliefs about the investment environment of the 2020s. My thoughts on how the investment landscape will evolve over the next decade are in constant flux. I am always searching for new ideas, narratives, and opportunities to further increase my returns.
My portfolio is not your traditional 60/40 stocks and bonds portfolio. Over the past 2 years, I have dramatically reduced my position size in index fund ETFs, and increased my allocation to individual assets. As of today’s writing, approximately two-thirds of my portfolio is invested in just 4 assets: Bitcoin, Tesla, Square, and Ether. The remaining third is split roughly equally between cash and index fund ETFs. These are some of principles that led to my unorthodox portfolio construction.
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Casa enables Sovereign Individuals to Exit the legacy fiat currency system and migrate to the Bitcoin economy. Casa Keymaster blends the best features of custodians like Coinbase with hardware wallets like Trezor, making it easy for individuals to safely store their own Bitcoin without the need of a trusted third party.
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