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The following is a slightly modified transcript of Mike Block's recent conversation with Peter McCormack, host of the world-famous podcast What Bitcoin Did. You can find more What Bitcoin Did interviews and subscribe to the podcast here.
What Bitcoin did: Mike Dudas of The Block on Crypto Journalism
Peter McCormack: Welcome to What did Bitcoin do podcast. Hello. How are you all? Are you living a fantastic week? Simply the best Bitcoin podcast in Bedford. They are the hosts, Peter McCormack. Today I have an interview with Mike Dudas of The block.
Let's move on to my interview with Mike. Mike Dudas from The block, which I also love because he is also a Liverpool fan. We are not just talking about football, but we have been talking for a while. Kind of knowing it. I followed what The block do. Just a note before listening to this. We actually recorded this before Christmas. But the way the program worked, this should have come out on Christmas Day, which I thought was a waste of time, so I postponed this week. You know The block? Did you check them? They have definitely changed the game with cryptic journalism. From their hard relationship to their in-depth analysis. Their content has certainly created ripples in the whole cryptographic space. If you are on Twitter encrypted, you can not absolutely lose it.
But many things stand out on them. From the quality of the team that Mike has recruited, to the way they make sure they have no conflicts of interest with what they do. I wanted to talk to Mike. I wanted to let him in. I wanted to discuss the background of The block, but what is their strategy. At one point I'm going to get some of the other journalists from the team. But now you have the protagonist. You have Mike. If you have any questions about the show, you know you can contact me. Be sure to follow you too The block. Okay, so at the interview. As I said, if you have any questions you can always contact me. My e-mail address is [email protected] I look forward to hearing from you.
Listen, I followed The block for a while. Following your work. Absolutely adorable. But fully recognize that you are very different from any other cryptographic publication. Throw grenades out there. Great stories, great coverage. Tell me about it. What is the strategy? What are you trying to do here with The block?
Mike Dudas: With The block, we are really trying to bring objective, journalistic and clear and objective fact-based analysis into facts in an ecosystem where 95 percent more of the projects are fundamentally idiots. If not in the next two months, in the next two years. It's clear enough to anyone. They were all saying from six to eight months ago for this idea The block He came first, "Look, this whole quote from an unequivocal asset class is overrated." But nobody was covering him that way, right? You had CoinDesk and others that literally publish BitConnect ads. It's crazy.
The mainstream media at the moment did not understand technology well enough, the government quite well. Virtually anything good enough to report on this carefully. They were just reporting on the price. including CNBC, Including Bloombergand do it in really short segments. We believe, of course, that we have worked in FinTech at Braintree, in Google Wallet, at Venmo, for years on PayPal, that blockchain and cryptographic activities are an important significant evolution in the way we think about money, how we think of technology and value, and digital resources. I do not think it is like the traditional FinTech, which tends to be co-opted by the big banks in the existing system. I consider it as something that can exist outside these systems. This really excited me.
At the same time, he was disappointed by the lack of professional coverage in the space, and we felt we could play a role as a source of information and highly credible media, helping to highlight good things and highlight bad things. So it really separates the wheat from the chaff.
Peter McCormack: All right, all right. You noticed the opportunity. What did you do to make it happen?
Mike Dudas: Basically it's a business of people, right? This is the ecosystem of an entire ecosystem. We are creating software. We are creating protocols. We are not creating, in our activity that is a media activity, information, research and analysis. Or in these technological companies that are created. It is mainly based on software. There are many people. The biggest thing a The block he was able to recruit those who were the best in the world.
The best in the world in this ecosystem is not someone with 20 years of experience, because no one has it outside of a handful of people who were crypto-anarchists in the 90s, right? It means attracting people who are curious. People who have a thorough understanding and a huge amount of energy and are so passionate about this. I mean our team, we have an internal Slack group that we use for a variety of reasons. But we spend, you'll see a message, like 22 out of 24 hours of the day from someone on the team. Energy is palpable. Recruiting the best people is the key. The best researchers The best analysts The best technologists.
We are really excited about where we are. We have a really good team. The output has been exceptional since we launched the product in September, and the audience followed and the attention was followed.
Peter McCormack: You said you think 95 percent will go blowjob. What do you think about it?
Mike Dudas: Probably more I want to say, is if we go to count on token 5,000 CoinMarketCap. There's just, I mean, there's a whole bunch of reasons, right? There are people who have literally cheated others. You have a variety of scams. You have a variety of people who raised money because it was easy to sell tokens to the public. Often in unregulated ways. So they simply do not have the ability to build what they said they would do. I mean, I'm probably making numbers here, but it's a big chunk of projects.
Then there are people who believe they can do things that they could not and had to close. Then come to the cream of the crop, right? I mean you have … When such entities as the Consensus employing a thousand people at the peak are sacking hundreds and hundreds of people, with many more to come, you know that funding has gone much further than what technology is able to . I think that many things that have been financed will do so, has so many similarities with the first internet bubble. But it will be things that, in 10 years, an idea might make sense, but not today.
Much has to do with "Cool, you can do this technological thing." But the compromises to do it on a blockchain are that it becomes absolutely useless by consumers or businesses. Because the interface is simply abysmal. That is another segment of products.
So you know, the products are actually good and interesting. Only, many of them are not receiving the use. We look at the dApps for consumers, which was a very popular case for Ethereum outside of ICO funding and ERC20 tokens. The dApp, both for work and for consumer use, simply is not there yet. EOS was launched to try to reduce friction and improve scalability. But again, we're talking … The big question right now for so many of these projects is, "Is a blockchain necessary?", Right? For many it is not.
Peter McCormack: All right, all right. You said too CoinDesk. It looks like a number of other cryptic publications and websites, they are reporting in a different way. Do you think some of them, maybe this is … Well, I probably identify two reasons. One is a conflict of interest in the larger group they can belong to. Secondly it is the model they have built. I believe many of these companies rely on these cryptographic projects as a source of income. We have seen that some actually accept payments for positive stories. Do you think that's why they did not cover it? Obviously you have a different model.
Mike Dudas: Yes. I mean, it's very easy to join a group. Let's start with the mainstream media, right? The mainstream media cover this because it gets a disproportionate amount of clicks and attention. It's interesting and it's a class of money as well as a technology class. But they focus on a general audience and generally do not give the specific thing they are looking at to the depth of treatment that is needed. The Economisit is the most guilty of this. Bloomberg he is occasionally guilty when they put their general purpose reporters on it. But when they put their cryptic reporters on it they actually do a really damn good job. Fortuna he has good people, like Jeff Roberts. There are some good reports on the mainstream media. But I would say that in general it does not go deep.
Then you understand, I think the area you were most interested in focusing on is the Coindesks, the CCNS, and the CointelegraphWe use only those as the three largest media entity crypto play. CCN is Cointelegraph they are the first ever Business Insider. Just write down every single thing, aggregate. Do not worry too much if it is perfectly accurate in fact or has depth or things are written correctly. So let's monetize it, as you just said before, ICO ads and name any product. I mean that you always go to their home pages or pages of articles and you'll see low quality ads. This is the model. Very low cost content. Very low quality advertising. It's just volume of the volume. So, as you said, they accept sponsored posts. Which denote. But sometimes it is not the most transparent way.
Then you have high quality media, which is a new interesting category, and I'll come back on Coindesk. But you have a high quality medium. Some of the new ones like Decrypt Media, for those with great respect, e BREAKER, so I have a great respect Now both are funded by, therefore decrypt it is funded directly by ConsenSys, and so while there is a Chinese wall there and that team has great editorial integrity, it is only difficult to operate with that relationship without doubt creeping into the reader's mind, right? But again, what I've seen so far is a high quality report. I wonder if the stories are killed or other things happen and who knows what their long-term revenue model is. Or if it's just to be some sort of patron financed by ConsenSys in a similar way to how The Washington Post he could lose money because Bezos owns it.
BREAKER is another I do not know what the long-term revenue model is. It's hard to really comment on what their plans are in the future. But today you would look at them and say, "It will be a very difficult challenge to establish companies with one of these models". Unless they are funded by the projects. BREAKER is funded by a project, Singular DTV that ICO 'd, is sure it is a treasure, and can continue to invest in this. They have connections to New York magazine as consultants. These are the only two that I see doing quality work similar to us. But the financing model and the business model are under discussion.
In the end we will arrive Coindesk. Coindesk is a wholly owned subsidiary of the Digital Currency Group. Barry Silbert, one of the most powerful and connected people in the whole ecosystem, who has his tentacles in so many different companies, so many different projects. Its entity is 100% owner. Now Coindesk has fantastic editorial talents. Both from the pure editor side, both from their journalists. They also have, and have great analysts and researchers. It's a mix They did a great job and they did a job of inferior quality. But on balance they are doing a good job.
The fact is that their model is not journalism, analysis and research. It is the conference. To your initial question, they make profits that they essentially make in these series of conferences with which he is paid to speak. He is paid to participate, and is paid to speak. We are talking about tens of millions of dollars of cumulative gross revenues for these sponsorships, for these commercials and for participation in conferences. Journalism aims to arouse interest.
We look at ourselves … We looked at that landscape and then we looked at each other and we said: "Look, there must be someone who enters this market". How information generally has technology. Like it CB Insights has in terms of analysis in broader technology, and who does this independent journalism, in addition to independent research that people will pay for. This is what we are doing The block. While all our work is shared free today, we will introduce a paid product in the first quarter.
Peter McCormack: Do you want to talk about that product? How much can you tell me?
Mike Dudas: Yes, so I'll give you the general profile. But it will be heavy on some different things. Number one, we will go much deeper into our research. Some of LUMAscape style charts you've seen on corporate blockchain or stablecoin, we will dive deeper into research in those areas. This will be feasible for people who want to invest, who want to work in those areas, who want to understand the technology. Our analysis will go much further in the search for specific exchanges. Looking at the volumes of trade and potential irregularities. I mean, these are a variety of topics. Again, things that will influence the way people might trade.
Look at projects much more in depth and look at people a lot more in depth. Doing things like that L & # 39; information ago, where they highlight deeply, "Who are all the important people in the organization X, Y or Z? Or protocol or foundation X, Y or Z?". Things like CrunchBase. John Biggs is working with us as an editor right now, and it's incredible. He is the founder of CrunchBaseand so to have John who gave us this guide as we launch this premium premium product. It is someone who has worked in the crypt for over a year before joining us in recent weeks. It's just a huge blow to our efforts. We have one of the most important people in the world to launch one of these information, research and people services, helping to lead our editorial teams.
Peter McCormack: Right, so it all comes down to the team, right? You have identified, you must get the best people.
Mike Dudas: Yes, it's the team. You know, I omitted journalism. We will continue to give news. Consider investigative journalism, like the great piece Frank Chaparro wrote about Blockchain Terminal last week, as very important. Because we want to share things that the general public, and even potentially the investors in the project, are not aware of. We know for certain that in some cases we have shown the light on certain things that people have then, the authorities then said: "This is something we must investigate". We think this is really important for the ecosystem, because we have resources and we believe that when we present our paid product, we will create such a value for people who will also have a business model. Supporting something I said before will separate the wheat from the chaff in this area.
Peter McCormack: With those quite controversial stories, the investigative side of journalism, how much consideration do you have to give to the risk of publishing an article and how could it reflect us? Or you get up and say, "Look, we're journalists, we're reporting the facts"? Freedom of press, etc. Where are you with this?
Mike Dudas: We make sure that the things we have printed, which we publish on www.theblockcrypto.com, have been verified. They have been managed by lawyers. They are exceptionally well supplied. Whether on the disk or with multiple sources off the record. That we have been aware of evidence that supports any factual statement we make in those articles. What we put in these articles, we are 100% safe.
It's always clear in investigative journalism, and you've seen this with higher profile cases. Things like, the Wall Street newspaper cover of Theranos. It is always to deny deny deny. Then the onion is removed. It is always a cost-benefit analysis. When you say, "Should we remove all eight layers of this? Or should we just leave it with the two layers we have removed and return to focus on what the client is looking for?". In cases where we have done some investigative journalism, and we will have some additional pieces coming up next month, we will basically write the piece and share a reasonable amount of information that we believe is essential to tell the story that the public needs to know, and that we can demonstrate. But this does not compromise our ability to do all the other things we do, right?
We can not put 100% of our resources into investigative journalism, even if we literally receive, I'm not kidding, we receive more than a dozen tips from our team that are worth investigating on potentially significant scams and scams on a daily basis . It's really wild I've never seen an ecosystem like this. Having talked to journalists in other vertical sectors and telling them some of the suggestions we are receiving, not all of them are confidential. It means that people share them freely. They say, "Wow, this is great." I mean, there's a lot of crazy things in the ecosystem.
Peter McCormack: How do you think we got to this point, then? Where there is so much.
Mike Dudas: It was just a wild period of excesses. The tens of billions of dollars of paid-in capital has been provided by a number of unrelated investors globally in a relatively unregulated manner. He just opened a crazy Pandora's box. I mean, not to mention the real societies that are still in operation, and I'm not going to name anyone in particular. Because again, we have some ongoing investigations. But look, we had a piece just yesterday. That one percent of the volume, this was just a small piece we wrote, and basically we were repeating what a more detailed study had said. But the 1% of BTC's volume pairs on the first 25 pairs was a legitimate volume, and over 90% consisted of unlawful washing or volumes. I mean, it's just a mess.
I think it's too much money. Insufficient regulation. Too many jurisdictions. Whether it's state, federal, more countries. These types of markets clearly attract the worst kind of people, right? There is money laundering capability. There is the possibility of getting out of the scam. I think people are still, a lot of cheaters you'll see, and I'm not talking about anyone we've covered or something we've covered. Because I'm not insinuating anything about someone we talked about as scammers. But right in the ecosystem, the things people often do that I read about and see other people covering, or that the SEC is actually sorting out with people, I mean they're just stupid things. These are things that will obviously make you discover. Type "What the hell are you doing, folks?".
Peter McCormack: It therefore seems that your business will change a little with the market. Obviously there is so much to report right now. You know, we will have a complete cancellation from the market. A complete shaking of projects that can not be sent, will not be shipped, shipped but low quality and will not get users. All these projects will be wiped out. But at the same time, if we compare it to the dot com, there will be another round of investments of sensible ideas that follow the regulatory framework. I guess over time, you'll do it, the kind of thing you're going to report will be little bit of the scams and bad things that will happen. So you will start to follow all the positive things that are happening.
Mike Dudas: Exactly. This is literally our dream. I did not know that the market was going to lose 85% from the day I made the decision and I wrote my one-day post on average in January, when we were up by 1740 Bitcoin. Where are we now? 3500? My wife certainly tells me several times that I should have sold more of a peak. But you know, you cover what there is to cover. We do not write very often on price, but we write about projects that have problems, and there is more than there are projects that shine.
That said, we will have a great piece written by Arjun Balaji, our technical advisor, this week on Lightning Network. We are waiting for Myles Snider to write a piece, a positive one, on EOS. There are so many good developments in this ecosystem that we want to cover. I expect to see the pendulum swing in 2019. But not quite. In other words, there will be projects short of capital. Projects that are folded into others.
Then there are those who will continue. The best example and the one that fascinates me most is obviously Ripple and XRP. That is, then Ripple is a company and XRP is a protocol, which is unquestionably connected. There is no doubt, no doubt on Earth. We spent some time. Larry Cermak, our chief analyst, wrote about this. I had a tweet about Thanksgiving about what was supported by public facts. That story will remain. We're not going to …
Our coverage, the way our coverage will change, we will not continue to repeat the Ripple security thing over and over again. We're not here to beat dead horses. We are not here to chase specific people or projects or to demonstrate points that we feel we have tried or covered. But if there's new news, I want to see Ripple in reality, I'd like to see them get the product. I worked in companies similar to them. With Google Wallet, which has been launched from scratch and now is Google Pay, it is globally accepted.
I worked on Venmo when he had 30,000 active users on a monthly basis. I mean, it was incredible to see the launch and size of this product. To help Braintree grow. Establish a company in Button that has gone from zero revenue to more than halfway to $ 100 million in gross revenue. It's something, I'm an entrepreneur. I want to see these people succeed.
The thing with Ripple, to go back to that example, is only part of the mealymouthed thing, and has changed the narrative about the links with the current cryptocurrency protocol. But if the company had just existed without trying to force the token into the business model to sustain the treasure, which has become their actual business model, which means selling XRP, I would be favorable. I'm favorable as Ripple, if they can improve on Swift. But as the CEO of Transfer Wise said, "I have not seen it until today."
Peter McCormack: Yes, and even SWIFT will not just leave their business model from beneath them.
Mike Dudas: Obviously not. I look at them more like the FinTech than the Bitcoins. Which potentially could be a reserve of value. You know, programmable money resistant to censorship. But we can save that conversation for another day.
Peter McCormack: What do you think about the XRP community? In what I've noticed, I'm very suspicious of the bot's business. But I do not know if this is centrally controlled or if it's something that is just some very eager fans of XRP. But one thing that is known, the volume of XRP people who have XRP in their name, the XRP logos on Twitter, hammer Coinbase every time they make an announcement, they do not discuss any crypts outside of XRP. If you dive into their small communities on their bulletin boards, they just share the contents of one another in this kind of strange community.
Mike Dudas: Yes, so look. It hits me … Again, I'm not a journalist and I'm not an editor of The Block. I feel like I can say that it seems suspicious to me. That said, and I've noticed, and many people like Jeff Goldberg, who is almost obsessively talking about this publicly on Twitter, and is someone I've known for years pre-cryptic before he does something like that. But it seems that the evidence he presented is at least able to raise an eyebrow on the coordination of some of these things.
Personally I have no evidence that this is connected to Ripple Corp, or that Ripple is paying any of these. I would never make that suggestion or accusation. But you wonder if anyone is, right? I do not know what's going on there, that's all I have to say. But you do not see behavior like this from any other crypt citation of a community. See people talking about technology. The general level of sophistication of the arguments of that particular army and community over any other is as if I could not put a number on it. It is significantly lower and less sophisticated. It is not even worthwhile to commit to this point. I just took a policy on my personal account to block it.
Peter McCormack: Yes, and you know what? How it separates what is The block and what are the personal opinions? Twitter accounts tend to be personal.
Mike Dudas: It's very difficult It's very difficult I'll never get to a point where 100% of people will agree with 100% where to draw the line. By the way, I think it's true The block coverage. We also discuss internally, how much should we say about our personal accounts? How much should we say about The block account. So what should we cover? We have many internal debates on what we should cover and how we should cover it and have different points of view.
But basically I think the rule, and I'm learning as I go, because I've been historically in more corporate technology. Which, by the way, was why it was so fun to raise $ 2 million for this business during the summer. A business that I had never done before. But our investors believed in this mission, they knew that I had been in the crypt since 2013 and I was passionate about it, and that I am a great recruiter and that I could recruit this world-class team to do it. But my personality and who I am and my passion are an important part of what makes this tick, and this is also true for the rest of our team. Larry, Frank, Steven, John Biggs.
I got it, one of the highest praises or more, literally one of the kindest things someone has long told me, John Biggs, again, soon TechCrunch, who came with CrunchBase and worked closely with Michael Arrington, said, "Dudas, buddy, you remember Michael Arrington in the early days, like fire," and he said some other things. I was excited by that. I think Michael was able to do it, and he's still in the big game in the crypt. But he was able to think about moving the industry in a number of ways and in a positive light. In a positive direction. Get more visibility. Make it ready for mainstream coverage. I'd like to do it for Crypto too. But I would like to be the mainstream publication.
TechCrunch, have somehow bought and have not necessarily realized their true financial potential. I think we can learn from some of the things that happened there to do it. To do even better.
Peter McCormack: Tell me about the team, then. Because this is one of the most impressive things. You have recruited this team all star. Every time someone new arrives, you're like "Yes. I've already read your content." Tell me about the team. Who are the key people. What are their roles at The Block. But also, tell me where the gaps are. Who are you looking to get in the future. What kind of people.
Mike Dudas: The key people, my co-founder and CTO Jake McGraw, are incredible. He and I worked together 10 years ago at the first startup that both he and I worked in & # 39; 08, & # 39; 09. Which was an advertising technology startup. My key rule here is that the absolute best sign that someone will be fantastic to work with in an early stage society is that you know them and have already worked with them. Or you know their work.
Jake McGraw is my co-founder and it's incredible. John Biggs as our publisher, we separated from our founder publisher. John is incredible. He has an extraordinary experience, skills, relationships. I can keep him calm and beautiful when he is alone, I am a very emotional and fiery person as you know. He brings measure. But candidly, our strongest asset is the people who do the job. It is Larry Cermak, our chief analyst. It is Steven Zheng, our chief researcher. It is Frank Chaparro, who is our senior correspondent, and he came to us from Business Insider. Then Isabel Woodford, who just joined us, who had worked at Reuters and is based in London. These four are doing the job that makes this company really special.
The fascinating thing is that each of them is less than 25 years old, but knows more about this space, whether it's about technology, whether it's about people, whether it's companies, or me. My job is to get slightly less topical knowledge on many things and then help orchestrate what we cover. Go out, sell and market, raise funds and lead the team. But these people are world-class experts. They were so amazing that they helped to attract Arjun Balaji, who is one of the first five people. We have been friends. I jumped for joy when he agreed to join as a technical consultant. He is giving us a good amount of time and will publish some work.
Ma il punto è che un grande talento attrae grandi talenti. Ora stiamo ottenendo più contributi, idee, suggerimenti. Poi, ultimo ma sicuramente non meno importante, ho assunto un ragazzo di nome Mike McCaffrey, che aveva lavorato per 18 mesi alla Citibank come investment banker. Ci è stato consigliato da due investitori. Bloomberg Beta, lo adoro Bloomberg è un investitore nel nostro business, e Ken Seiff di Blockchange, che è un incredibile investitore. Più fondi e solo un uomo meraviglioso. Ex CEO e un grande consulente per noi. Ma entrambi hanno consigliato a Mike di essere il capo dello staff, e in seguito lo abbiamo promosso a direttore delle operazioni e della finanza, oltre che a capo dello staff. Il ragazzo ha 24 anni. La maturità che porta. Hai bisogno di questi eroi.
La cosa più grande che ho imparato, non reclutare su LinkedIn. Non abbiamo nemmeno bisogno di postare posti di lavoro, perché la nostra rete, le persone che vediamo, il talento fondamentalmente viene da te se stai facendo grandi cose. Questo è quello che è stato così eccitante. Queste persone migliori sono all'altezza della sfida in un modo incredibile. Stiamo solo cercando altro. Francamente ci dà quello che chiamereste una citazione arbitrando l'opportunità rispetto ad altri. Compensiamo ogni singola persona a tempo pieno del team in equità. Così come il denaro del valore equo. It’s basically like you have upside above and beyond. That’s something, that we don’t have to over over over pay like I bet some of the other publications out there have to. We can pay these folks and give them upside. It’s an unfair advantage.
Lastly, we have Stephen Palley, who is one of the best lawyers in the space, working on our behalf. That really, I developed a friendship with him. He’s really been an incredible asset to the team, because so much of what we do does require a legal review prior to publication.
Peter McCormack: Yeah, it’s a great team. I’m a fan of every single one of them, every person you just named. I think they’re all amazing. One thing, it seems to me as an outsider, and I could be wrong. But it feels like you don’t really have any kind of huge hierarchy of structure. It feels like you probably have quite a flat structure, and you give your team a lot of freedom.
Mike Dudas: Exactly. That, I didn’t actually answer the last parting question which was, “What are the gaps?”. We are launching, as I mentioned, a paid product. The biggest thing, and I just posted this actually yesterday publicly, that we will hire between now and February when we launch additional researchers and analysts. There’s some really really exciting world class people who we’re talking to. We’re going to hire more full time folks. With love, anybody interested and listening, to apply on our site. As well as contributor pieces.
It’s just the exposure that folks will get. They love it. They can get it on our site where we’re seeing now hundreds of thousands of monthly visits. As well as through our newsletter, which is read by just an insane who’s who of the industry. Obviously can’t reveal names. But these are C level folks at Fortune 500 companies. These are leaders in protocols, household names, investors, etc.
Peter McCormack: Another thing I’ve noticed, and really I’m a big fan of, is the design of the website. It’s very simple. It’s very clean. It’s very easy to use. It’s a real joy actually. As somebody who’s come from a web design background, I don’t like publisher websites normally. Usually they’re either ugly, or something like Mashable which try to do something different, which I don’t get along with. Your site is just really easy to use. It’s a really nice chronological hierarchy of stories, which you can filter by Bitcoin, Ethereum. It’s very very simple. I’m guessing that was a key decision, right?
Mike Dudas: Absolutely. The original idea was crypto simplified. “Crypto Simplified”, that’s the tagline. That applies whether you’re presenting exceptionally complex ideas, or whether you’re doing blockchain 101. We were really lucky. So much of this comes down to relationships. I mean, you put yourself in a position to get lucky. But my co-founder, Chris Maddern, of my former company, Button, and who I also worked with at Venmo, recommended an incredible firm called Charming Robot. Who are world class designers. They’ve worked with The Skimm. They helped launch Skift, which was Rafat Ali’s travel publication. They’ve worked with a number of other great folks who all endorsed them to us.
I knew Dan Maccarone, the CEO, and Eric Bowie, the COO, for a while. They did just a bang up job. This is pre-Jake coming on as our CTO. We wanted to build up the site, get it launched on WordPress. You’re going to see a lot of updates. But in terms of that clean “Crypto Simplified” design, they did such a great job. We wanted to be distinct and look different. In sort of that snippet based or kind of block based design. They helped with the name as well. It was certainly something that I thought about in the shower, and kept thinking about at 3:00 AM. Now we have to figure out how to get the domain name.
Peter McCormack: Somebody else got it?
Mike Dudas: Block.co. Block.com is like Chevy, I think, and I don’t think they’ll be selling.
Peter McCormack: Right, okay. All right, so look. It’s all going well. Readership’s up. I saw you put the stats out. They were pretty impressive. You’ve got a great team. Your paid product’s coming. Everything seems to be going well. What are your main challenges, Mike? What’s the stuff that is keeping you up at night?
Mike Dudas: Yeah, so as a CEO you always have to mix a healthy dose of optimism and paranoia. I’m most optimistic about the team, as we’ve talked about, and about the reception to what we’re doing. At the same time, there are risks, right? We’re largely pre-revenue. We do have revenue coming in, and we will start, by the way, running sponsorships from key partners. Those will be sponsored posts, clearly delineated. From brands that we have great respect, so high quality brands. Not like ICOs that we wouldn’t believe in or things like that. In January. “How is our audience going to respond to that?”, would be a concern. Hopefully well, and we think well.
Then are we going to get that right mix? We have some more hiring to do over the next couple months, as I mentioned. On the research and analysis side. We believe we have the product people are going to like. When we launch the paid product, the last thing I forgot is we’re going to have like a Matt Levine from Bloomberg style, or a Ryan Selkis style column on a daily or every couple day basis. That’ll be behind the paywall. But you know, will that product resonate? We think it will. My basic thing is, I’m not going to name the price point now, but basically at the price point we’re going at, if we help you make one good decision per year you’ve more than paid for your subscription. That’s kind of the bar that we want to hit. We want everybody to make 10X from what they read from us.
Then the next thing is, well does the market recover? Right? The market doesn’t have to recover per se. But you need some volatility for folks to remain interested. I don’t fear that, because I’m kind of a true crypto believer. But I think there’s a reasonable logical question. But I think we’re past that point, just based on the developer activity I’m seeing through the downturn. The market changing next year. We will go to market to raise one more round of capital, and I’d like to turn profitable on that rate. I plan to raise a series A. I plan to do that in sort of the late Q1 or Q2 timeframe. Based on a really strong management team and a really strong editorial team and a product that will be starting to generate some really good revenue. Led by me, by Jake our CTO, and by John Biggs, our editor in chief. I think that’s going to be a really compelling vertical media and information value proposition for investors. But always a risk as to whether you can raise. I mean, I’ve done it before and I think we can do it.
Then the last thing is just, can we maintain, can we keep our people, right? Can we keep them engaged as their star grows? Because I think it will be advantageous to everybody that we stick together. But this is a people business. I think we all make each other better, and as a leader it’s my job to put them all in a position to keep doing that. But scaling is hard, man. You know. You’ve seen it. I’m sure you’ve been through it. I did it at Button, at my last company. Over 100 people now. It’s like every, when you go from where we are, 10 to 25 is a huge jump. 25 to sort of 40. After that it’s just, once you’re above 40 it’s just constant evolution. People are coming and going.
I think we’re a different kind of business, where we don’t necessarily need to get that large. But keeping the core intact is really critical, and always the biggest risk.
Peter McCormack: Yeah. The most I ever got to was a full time team of 35, and like a transient team of five, so let’s say 40. What I noticed is, and I’ve had this twice actually, about 15 people, above that it starts to change. Because you can’t be there holding hands and everyone making decisions together. That kind of united front kind of changes. But the biggest change I had was when we went over 30. It was almost like I had to let go. My job became to manage the people and manage the company. But also you have cliques form and groups form within the company, and politics has become something that’s very hard to find. It just naturally happens. Though I’m sure you’re prepared for it, Mike.
Mike Dudas: Yeah, we are. But that will be a challenge. We’re already in five timezones with 10 people, so it’ll be interesting as we hire. In Asia for example. We have a reporter role that we have open there, and we have contributors from there. Joseph Young right now who’s a phenomenal contributor who’s written a couple pieces for us. We’ll have to grow and grow prudently. But you know, the distributed mobile company, it’s a new thing. We’re looking at the folks who perhaps haven’t done it as well, right? Or have grown too fast. You see ConsenSys cutting back.
ConsenSys has done … I don’t mean to pick on them. They’ve done some incredible things with the Ethereum ecosystem and for the crypto ecosystem at large. But you know, grew too fast and then had to pull back, which can hurt folks. But by the way, that’s I think positive for the rest of the ecosystem. We’re talking to ConsenSys folks ourselves. I think there’s going to be landing places for that talent.
Peter McCormack: Yeah. I think, I can imagine in a couple of years we’re going to look back at 2018 and hopefully say, “I’m glad that happened. It was needed. It was required. We needed that to shake everything out so people focus on fundamentals again”.
Mike Dudas: That’s what we say about … We make mistakes as a company in different areas. Whether it’s resource planning, hiring, you name it. As long as you can kind of do a retro, take those lessons and grow from them. I have this experience from previous businesses. Not dwell, right? Just like, if I was dwelling on the fact that I lost 80 percent of the notional Bitcoin value that I had at the beginning of the year, I’d drive myself nuts. I don’t. Right? I thought about it as play money, and I hedged by actually building a business that I think is going to be tremendously valuable in the long run.
Peter McCormack: Well look, you saw my tweet, right?
Mike Dudas: Yeah. I didn’t want to interrupt, yeah.
Peter McCormack: Yeah, no, it’s fine. It’s –
Mike Dudas: You’ve got a lot of stuff going on. You’re going to look at this in five years and say, “Hell …”. I really think, because I see you, the energy that you bring. Now it’s my turn to say nice things about you. But I see the energy that you bring in all of your endeavors. By the way, just like I know you don’t agree with 100 percent of what I say publicly, I don’t always agree with you. But I have such respect for your energy, your conviction, and your honesty and openness. Because again, I’m the same way. Very honest and open.
It’s risky and it exposes you. Vulnerability to other people, that they can then point to later. But the bottom line is, you’re a doer. You’re doing three, four, five things now, and you’re going to be successful. Because I think you have good judgment. People are interested in what you do. You have good ideas, and you’re thoughtful. You’re in, as far as I believe, the right market at the right time.
Peter McCormack: Yeah. You know, there’s a lot of luck there. But it was just on your point, right? You said you hedged. You wish … Like I wish I’d sold. I got a phone call from the Guardian newspaper today, because they wanted to talk about what happened. They thought I was all depressed and miserable. I said, “You know what? I’m not”. They asked if there were regrets and I said, “Regrets are stupid. Because every decision I’ve made, at the time I thought it was the right one”. Right? There’s no point having regrets.
But like you, I hedged. I was like, “This isn’t going to go on forever. I’m going to build a podcast. I’ve got a sustainable income. I’m not broke. I haven’t lost my house or anything”. Actually, I think we’ll look back and … If someone turned around to me and said, “You could have all the money but you wouldn’t have the podcast”, I wouldn’t take it. Because what would I be doing?
Mike Dudas: You have this platform now. It’s growing. Yeah, this is how I feel about The Block also. Yeah, bottom line, if you can take that positive approach, stay out of depression. Which, I’m somebody and I’ve said this publicly, who over periods of my life, I fight on a daily basis sort of clinical, clinically, I forget the exact description. But sort of social anxiety disorder. It’s a challenge. It impacts how I engage with people. But basically I work day in and day out so that I can overcome it and be that outgoing person. Which is so key to my business. If you’re resilient, even despite it being hard and challenging day to day, and taking those setbacks. Which you know, of course. As a startup CEO you can imagine, we’ve had setbacks. You’ve revealed the setbacks you’ve seen over the past year, and come out of it with that spirit.
Then look at the things that you’re lucky about. I mean yeah, I’d tweet this recently. But yeah, I’ve got a beautiful family. A son and a daughter, four and a half year old daughter, one year old son. Amazing life. My parents are incredible, brother. My wife’s family. I mean it’s just, it’s awesome. You know, I feel very fortunate about that. That’s the stuff that’s important when I’m not tweeting.
Peter McCormack: Anxiety though, it’s pretty rough, right?
Mike Dudas: It is, yeah. I developed, in my early 20s and didn’t know what it was until my mid 20s. It was most crippling when I didn’t know what it was. I would literally, if I got up in front of an audience I would literally break into a cold sweat. Then the anticipatory anxiety would become very nerve racking. Then you start to avoid, and I’ve always been a social outgoing person. You’re like, “What the heck is this?”. But often it happens to that type of a personality.
I’ve over the years managed it. I mean it’s been literally, I’m almost 40, so I’ve been managing it since I was, managing it well since I was 26. It’s been like 14 years. No fun. Daily battle. Many other people have, that’s what you would call kind of a mental, let’s say a mental illness. In other aspects of my health I’m very fortunate.
Peter McCormack: Yeah. I had, I’ve had bouts of anxiety for five years. Panic attacks. SVTs.
Mike Dudas: Yeah. I read about it. That’s what I felt comes from wanting … chatting with you about it. Mine hasn’t gotten to that point. But there was a period actually when I literally would, it was painful to fly because I associated it with … Then physical things, again, would manifest it. It wouldn’t be like a heart rate. But sweating, and I’d get these weird things, like leg cramps, and all kinds of odd stuff. The brain is a powerful thing in positive ways, and can be a powerful thing in negative ways.
I find when I talk to other people doing really exciting, interesting, on the edge things, many of them share these kind of unique things that they manage and that drive them to be better and let them sort of exist on the extremes. Right? I mean I just – I feel that is comforting. That I know there’s many other people out there. Again, I’ve been successful. The most successful parts of my career have been while I’ve been managing that. It sort of drives me to kind of prove like, “Hell, I’m going to win and win again.”
Peter McCormack: Man, I get it. I’ve been through the roughest times and the good times. I know what it’s like. All right, well listen. Look. This is really good stuff. But let’s talk about next year. 2019. Give me your predictions, Mike. What do you think is going to happen?
Mike Dudas: I think that this industry is going to return to a really positive builder mentality industry, across all key segments. We’ve seen the infrastructure being build on the institutional side. In terms of Fidelity and others building out institutional products. I think we’re going to start to see some really really early new consumer facing adoption. Endorsement from big companies like Starbucks, like Fidelity. I come from a world where I believe that’s important, even though I know many of the early folks and libertarians would say, and maximalists of certain types would say, or crypto anarchists I mean, not maximalists, would say, “This is bad. They’re co-opting our technology and our money”.
I think it’s necessary for mass adoption. You’re going to see broader adoption and usage of these technologies, and you’re going to see more building without the hashtag. You’re not going to see people bragging about building. You’re going to see some cool product announcements. I think people are going to follow the Lightning Labs of the world, and realize that actually delivering product and then showing how the nodes are growing week over week, and having people talk about it. Folks like Casa who are delivering products. Folks like Ledger. Folks like Nomics who just announced a raise today. Those are the people to follow. Folks like Ric Burton at Balance who keep trucking along, and then just mentioned yesterday that he was able to find a lead for his next round.
I’m excited to watch those builders. Julian from Unlock Protocol. The protocols themselves. Even the projects that are delayed. I’m somebody who’s interested in projects far beyond just a coin Ethereum. I was excited to hear Dfinity say, “This is coming next”. Even Hashgraph today talking about things in the future. I think we’re going to see a lot more things come into reality.
Then we’re going to see some things come to a head. Things that don’t work, right? We’re going to see much more regulatory enforcement, and some projects are going to settle and go away. I think that’s a healthy thing. You’re going to see projects make prudent decisions like Basis did, to sort of shut down when they realized what they proposed isn’t feasible. I thought that team wound down in an exceptionally professional way, and should be proud of themselves.
Then we’re going to start to see, I think … I think there will be a high profile disintegration. I don’t know what project it is. Bitcoin Cash is sort of doing it to themselves. But you know, just a big massive highly valued project that doesn’t deliver. I’m not going to name names. I have some in mind. That kind of the value craters even more than it already has.
I’ll kind of end with the notion of, I think you’re going to see separation in 2019. Maybe I’m hoping and projecting here. But between high quality project price, you’re going to see some drop, like a lot of tokens drop to negative 99 percent of all time high. I mean it’s hard to speak in these short term periods and I’m not going to make any investment advice or price predictions. But you know, wherever Bitcoin sort of ends the year, I think 12 months later it’s not going to go much lower than that. Or, I’ll say this. Two to three years out I see it being higher than where it is now.
Peter McCormack: Yeah. I’m with you.
Mike Dudas: In every metric. Hash rate. Activity. On the network. Transactions. You know, consumer usage and price.
Peter McCormack: I don’t know about you. I’m actually in some ways, I’m excited more than ever.
Mike Dudas: Oh my god, yeah. That’s what I should have said. I don’t think you’re going to see a stop to the flow of people. I do think you’re going to see more people entering into this ecosystem. One of the reasons, by the way is because I actually think, so it’s important to consider crypto, and I just use that word, slaying. But crypto in the context of the larger global economy, and so I think we’re going to start to see some real trouble in the larger global economy. That’s going to lead to layoffs. You’re going to see more people, people in technology, looking for things to do. Google and Amazon continue to expand. They’ll hoover up tons of talent. They’re building campuses here in New York.
But there’s a lot of other companies that are going to bleed people. I wouldn’t be surprised if you see some of those folks coming into this ecosystem and this asset class. You’ll start to see I think more … The one thing that I’m unsure of, the one thing I want to see just so people stop talking about it is this goddamn ETF just getting approved or not. I’m sure Gabor has talked about his. Was he on your show talking about it?
Peter McCormack: Yeah, he was on a few weeks ago. You know what? He put out one tweet that’s really interesting. I can’t remember the exact wording, but I’ll find it and put it in the show notes. But he said something along the lines of, that Coin Base is able to issue shit coin after shit coin to retail investors, whilst they are building a regulated product for institutional investors, and they can’t get approval.
Mike Dudas: It’s a great … I’m glad you brought that up. Please do interview my colleague Larry on an upcoming show, because he and I actually disagree fundamentally on this. I think a Bitcoin ETF should be approved. If you look at other assets that have been approved, when you look at market manipulation and those markets, I would argue, and Gabor would as well, that there’s no more than there is, at least to be alleged in the Bitcoin market. There’s a whole host of other factors they consider.
But then the next question is, “Was that tweet responsible?”. I’m of the opinion, I really like him, and I’m the type of guy who tweets some things that people don’t always necessarily think are proper. I thought it was fun. I think he just kind of called out the wrong company. Now, full disclosure, Coinbase is an investor in The Block. Very small. Less than 0.3 percent of the company. They, I have a place in my heart for them. They got me into crypto. My first meeting in crypto was when I was at Braintree and at Coinbase. But yeah, I view them as a very credible very secure exchange. They’ve still only listed, what, like 10, 12 coins at most? Silly one to pick on, I would say. I think listing a token for trading is sort of very very different than having it be an ETF available to unaccredited investors and available through traditional channels.
Once you get that Bitcoin ETF approved, it then can start showing up, not for people who seek it out on Coinbase, but for people who might see that in their traditional accounts. It is a big difference, and so it was just a weird analogy.
Peter McCormack: Okay. What are your predictions for The Block for next year?
Mike Dudas: My prediction for The Block is that when you look at us five years from now, we are going to be the absolute standard in the crypto ecosystem in terms of the brand that people think of when they think of media, information, you name it, right? like Bloomberg is to traditional financial markets, people will think of The Block as that to crypto. I don’t think we’ll talk about it as crypto then. I believe it will be digital assets. It will include things like tokenized securities. It will include some of the things that people today classify as FinTech. I think FinTech as a word starts to go away, and we’ll start to talk more about digital assets and things of that nature.
I have every intention to make us sort of the preeminent media and information brand. Multimedia by the way. We’ll expand into other media in this world.
Then lastly, I think media and information companies have not done a good job of creating communities. I think within the crypto ecosystem in particular, just like Twitch has done in video gaming, I think people love Telegram, they love Slack, in the crypto ecosystem to communicate with one another. They learn in that way. We are going to over the next few years build in an element of communication and community. LinkedIn will not exist in this ecosystem, and so we can act as a sort of replacement for them. It’s easy to say that. We have a pretty interesting plan on how we will get there.
Peter McCormack: Amazing. Who’s going to win the Premier League?
Mike Dudas: Liverpool. I would say by three points at the end.
Peter McCormack: I think it’s going to be close. That’s all I can say. I think it’s going to be tight. It’s going to be close.
Mike Dudas: Yeah. I’m not a lifelong fan like you are. I’m a six year fan.
Peter McCormack: Yeah. That’s enough. Well you know, if you ever get over here, Mike, I’ll get us tickets. I’ll take us to a game.
Mike Dudas: Yeah. We tried the last time. I ended up going to see Liverpool versus Palace, and it was an absolute blast.
Peter McCormack: Was that at Palace?
Mike Dudas: Yeah, and I didn’t wear any gear.
Peter McCormack: I mean, that’s a great ground. That’s, that ground is great. It’s a noisy ground.
Mike Dudas: Oh my goodness. I did cheer at the whistle, 2-0. The folks around me, season ticket holders, not pleased. Told me to keep it down. I was an American fan. You’re not allowed to clap for your team when they win unless you’re in the visitors quarters area I guess.
Peter McCormack: Yeah. I know the chairman because he used to be a client of mine. We used to do the web work and digital work for Crystal Palace. I got to know Parish, and he invited me to the game where we were three all at, you know, when we missed out on winning the league. What a game. All right. Well listen, look, Mike. This has been great. I knew it would be. Tell me, well tell everyone how they can follow The Block and how they can follow you, and who you want to hear from.
Mike Dudas: Of course. You can find us at www.theblockcrypto.com. We’re @theblock__ on Twitter. We’ve got to fix that. I’m @mdudas on Twitter. Love to engage. I have open DMs. We have open DMs for The Block. Please communicate with us. We’re looking for world class researchers to work with us. World class analysts and world class journalists who have a deep deep interest in the crypto ecosystem. We’re always always always looking for tips. If you have an interesting story that you’d either like to write as a contributor yourself, or a tip that you want to share with us. Either anonymously or under your identity. Please don’t hesitate to reach out to us.
Peter McCormack: All right, man. That was cool. Thanks a lot, Mike.
Mike Dudas: All right, thank you, brother.
Peter McCormack: Okay, so what did you make of that? Did you enjoy that interview with Mike? Are you following The Block? Have you checked out any of their reporting? Certainly some of their work is full on. But it is a breath of fresh air for someone to come into the space, have a new service which doesn’t worry about conflicts of interest, doesn’t worry about being part of a bigger group, and can just go out there and say it how it is. I give a massive amount of credit to The Block and Mike for the work they’re doing.
I was also interested to learn about how they’re going to monetize their product. I think their website is beautiful, but I couldn’t really see how they were going to have advertising on there. It was great to hear from Mike from their plans. I think the subscription service sounds awesome. Probably something I will almost certainly sign up to. Anyway, I hope you enjoyed the interview.
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