YouSaid · the spoken record

Michael Gronager

lines on the record: 19
first: 2022-07-28
most recent: 2022-07-28
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Indicates something. Right now it's hard to assess where it is, but the bottom is definitely higher than it was last time. And I think that's a good reminder to say this is something that's growing and is long term and it will change the world.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“You didn't ask me about the price of crypto tomorrow and the next year, but I probably wouldn't have answered anything because it can go in any direction.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“I would say it is, of course, like when we first built a company, we had one cryptocurrency that was Bitcoin. It was definitely simple in many ways. And then there was a few others. But then you go from a few to many. And as soon as you go to many, you need to say, okay, how do we make the entire system scale? How do we do it all? And I think we are in that phase right now. And that's where, well, whatever happens in crypto right now, we have a lot of resilience because we build for not just one or two, but for thousands. And that's basically the mindset and how you need to think about it. It also means that the fluctuations that we see today and the chaos in the market is basically just parts of what we can see and measure and analyze in our products.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“It's not really up to us to decide it as a data company. We basically provide the data for people to assist it. The latest product that has been announced is called Storyline. Storyline is interesting because it basically abstracts a lot of things away for the user. So it'd be like, if I send money to you, it's a very simple event. It's a transaction. It can be displayed in a simple way and understood. But if I do the same in a smart contract and smart contracts are part of Ethereum and a lot of more modern blockchains, then I can invoke other smart contracts in the same transaction or event. And then suddenly there might be 10 or 40 counterparties involved in that transaction that all play a role and different tokens involved. And that's basically visualizing that in a very simple way. So that's been a lot of, I would say, COVID time spent for me in like thinking through how do we make that approach real.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“Of course, I do. It's fun. I like that. And I would do like stuff like that every now and then where I dive deep into something if the time allows it. And then hand it off to the team or say that was just a little exercise that kept me sharp and made me understand something. It's also like how I work understand best things when I play with them a little bit. And sometimes you need to play with them.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“I think my career before getting into crypto in various ways, I've always been a mixture of getting deep in technology. And then when you get deep in technology, you create something and then you need to move into basically becoming an operator and management. So I always like been between those two areas, running big European projects and computer centers. What I focus on is trying to understand the systems that we are creating. It's not coding, I wouldn't say, but it's like definitely an organism or system where everyone has a role and has a potential for a lot of impact or less impact. Going from being a small startup on the couch, sitting at home and coding, and having more than 700 people in the company today, there's a lot of transitions and understanding of scale that I needed to learn.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“Ourself and your own business model with what it could use crypto for going forward will be important. And that's where you should probably focus today. And then I would say at some point every company will become a crypto company. And it will go in that direction, but it's also going to take some years before we get there.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“So it's a little bit discussing the same around the incident in the 90s, right? A few companies called Internet Companies, and they created this cohort of companies that you would look at and say that a little bit crazy. Maybe it will crash, what will go on there? And then slowly people started to be present on the internet. They got an email address, so they could be contacted that way. They got a website so people could find them. And that was like the first steps into that. And maybe the first steps into crypto that similar to that is enabling maybe crypto payments, if that makes sense for the business model you have, approach your customers through NFTs or other things and assess whether that's a part of the marketing strategy. You probably end up creating something that looked like websites back from the 90s, something people would look at for a while and then they expect them to maybe change to something that has another level of aesthetics. So I think we are early in the phase today, but I think familiarizing”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“Need for some kind of foreign capital, a foreign currency? And why do you need a foreign currency that can be capital flight controls that might hinder normal businesses from operating? There might be a need for other ways to move funds in and out of the country. Or there might be a certain level of distrust in the currency of a country. And in Ukraine, there's been concern around what would the value of the local currency be? What if there's an attack? What if there's other things? Can we trust it? So it's good to have some other currency available. That's the same role as we've seen the dollar play in, for example, Latin America, in some countries there.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“So it's like if you want to take a hundred dollars and launder them to crypto, of course you can do that. But if you want to take $100 million and launder them to crypto, first of all, there's no volume or no liquidity available in the infrastructure in crypto, so you can do it at scale. When we look at the problem, we say like crypto is probably the smallest of all problems in terms of money laundering and sanction evasion. We can monitor it in crypto and assess real time It's the same time an enabler to creating a way that we can help funding into Ukraine, for example, that we can support people to be able to buy medicine and other things in that side of the world. I think that the good size, good parts of crypto by far outweighs the ability to allow $100.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“No, because a lot of things require some manual input and some assessment here. If you, for example, see a transaction, you can see it's from a darknet market and you can see it goes into a crypto exchange. You can see something potentially money laundering-like happened on the blockchain, but you don't know who was behind it. So how do you figure that out? You would send a subpoena and sending a subpoena needs that you have a badge. So that means you send a subpoena to the crypto exchange that received that transaction and say, who was that? And then the exchange would say, oh, that was someone, and they would send back some information about that individual. And now they can start investigation. They would probably figure out, is there any history around that person? Oh, it's a known drug dealer from Ohio. So we already have something that cooperates it. Doing this at scale, no, you're not doing that. But that's actually good. It just enables the way society is built, at least here in the US, to operate the way that we like it to operate.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“Basically, you create a public ledger. It's clearly something that's not meant to be anonymous in many ways. And that's being debated over the last 10 years. So the perception where, oh, it's anonymous money, so now I can do everything online that I shouldn't do. And people started doing that. Then suddenly there was a reminder even back from the white paper of Satoshi that says, actually it's not anonymous. It's actually trying to preserve a pretty good privacy, but it's not really anonymous. I cannot easily find any person and individual on the blockchain, but I can understand if an individual transacts whether there was a risk associated with that transaction. That's pretty good privacy to me. It's not anonymity. We don't need anonymity, but we need privacy to a certain extent. But we can find people that do bad things if the things are bad enough. And that's basically striking a balance that I think is healthy for financial system. And I think it's been working pretty well for crypto.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“We use the industry linko here, it would be called transaction monitoring. So if you'd go to your bank and deposit $100 in the background, there's some algorithm running and saying Bob, he deposits $100. And that's all fine. If you came with cash for $100,000, then something might be wrong here. And then someone would look at it. And now we need the same in crypto. But in crypto, it's different because it moves faster. You don't know necessarily whether the transfer were international or whether it was local. You can't see that immediately. But we can tell you as analysis, and we can tell you where it came from, we can tell you the history of those funds. So we can basically build that into a compliance program and transaction monitoring. And that enables compliance professionals to work with a regulators and ensure that that's part of safekeeping finance. Follow the money. It always worked in capturing the bad guys, and it also works in crypto.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“The foundation is real, the innovation of crypto is very much about you can create digital scarcity. Digital scarcity basically means now you have something digital that have a value. Before that it didn't have a value. Any photograph, we copy, anything could be moved and copied, so it didn't kind of have a real value built into it. And now you build something digital with value. First application was Bitcoin. Other applications have been built and based on Ethereum. And the way it more and more looks what is becoming is like an operating system for finance. Everything that we saw as financial instruments, they can now be built as apps, not as standalone devices, but as apps. And that's going to create a lot of efficiencies, flexibility. That's going to just make everything explode in a good way. So we basically will see a lot of value generation, a lot of new business models, a lot of unlocking of illiquid assets. But at the same time,”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“I would say so. It's always a healthy reminder. In optimes, everyone would be focusing about how can we grow even more than like 200%? How can we grow more than 500%? You take everything for granted and you forget about the risk in it and the risk just hits you bad. It also goes very well in line with the company that I built around Genalysis. It's like we are focusing on the pics on the shovels of the industry. We are focusing on what we think is the most valuable asset in crypto. And that's data. It's basically understanding what happens in the space when we have good times. It's interesting when we have bad times. It's always interesting. And it just keeps growing. With the adoption. We are growing in a staple pace. We see the growth of the industry. And when we see situations like this, I'm like, yeah, that would happen at some point. And right now some of those who said a few months ago, yeah, but this.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“I got into crypto in 2011. Bitcoin. What really got me interested was because I read an article around how it crashed. The first quest was the price goes up to, let's say, $30 or so. Then suddenly the price went down to $2. And then fast forward, we went to another hype cycle in the end of 2013, where the price goes up to $1,000. And then the same changes again go bankrupt and the price goes down to a couple of hundred dollars. It's kind of a cycle where the way I best interpret what happens is that technology is being built. There's this dream about what this means for the world in the future. And then we start to live more and more in the dream and less and less in the reality. And we invest in the dream, not in the reality. And then at some point, we wake up. Yes, we can get to that dream, but it's going to take a long time to get there. And now we need to go back and building.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“Scale than we've seen in traditional finance, where we are counting quarters and not weeks, and in crypto we are probably counting days and weeks instead of quarters.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“It's important to remember the backdrop we have record high inflation, tech stocks that went up and up last year certainly took a big, big correction. Now crypto has matured. Bitcoin, Ethereum, the other assets have matured to become, I would say, yet another thing you invest in. So when everyone moves into cash and basically wants to divest or divest from risk, then they also sell their crypto. And that means that the price goes down. And then you see all the leverage that was built into the system. And that's where it gets really ugly. You'll probably see some of that falling apart in the traditional finance as well. It's just going to happen slower than it does on the blockchain. We saw most notably probably the Terra Lunar that fell apart. There was a lot of investors into that platform because it generated a lot of yield. So it was very tempting to invest money into it. But suddenly that meant that they basically went bankrupt as well. We've probably just seen them on a shorter time.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT
“Everything moves fast in crypto. That's how it is. A little bit discussing the same around the inside in the 90s, right? A few companies called Internet Companies, and they say that it'll be crazy, maybe it will crash, what will go on there, and then slowly people started to be present on the internet. And maybe the first steps into crypto that's similar. So I think we are early in the phase today. Become people, become a crypto company, and it will change the world.”
2022-07-28 · Masters of Scale · Rapid Response: What the crypto crash teaches us all, w/Chainalysis’s Michael Gronager · IDENTIFIED FROM THE TRANSCRIPT