👑 King Arthur's new favorite coin

GM everyone. This is 2036, the crypto newsletter that pays you.

Here’s what we’re serving up today 🍲: Arthur Hayes - the first African-American crypto billionaire - is the undisputed king of crypto trading. Last week, he divulged the latest coin he’s been accumulating. It’s crypto 🫶 AI.

Let’s dig in.

🥔 Today’s meat and potatoes

Get smarter on crypto in 2 minutes

We’ve said it before, but we’ll say it again for those in the back: if you had to read just one thing on crypto (beside 2036, of course) it should be Arthur Hayes’ essays.

Last week, King Arthur delivered his best keynote yet.

It was a 15-minute jam-packed speech. We linked to it last Friday.

Now - we know not everybody got a chance to watch it. So if you missed it, here’s the actionable summary:

1/ Crypto is driven by technology and liquidity (= money in the system)

So far, we’ve never had a bull market in both of those simultaneously.

Usually, it’s one or the other e.g. the central bank prints a ton of money OR we all fall in love with NFTs. But never both.

Arthur thinks the coming bull market will be the biggest in risk assets (including crypto) since World War 2 - because for the first time, we’ll combine both.

Here’s why…

2/ Rich people aren’t having enough kids.

Or, as Arthur so delicately puts it: ‘rich people aren’t f*cking’ (again, his words).

That’s terrible for the economy because:

• we borrow from the future

• to build things today

• in the hope that future humans will pay back the debt through their economic activity

That’s why GDP growth = Productivity + Population growth + Debt growth

But what happens when population growth stops?

We make up for it by borrowing. 

A lot.

In the last decades, debt to GDP has skyrocketed to 360%.

But here’s where it gets bad…

3/ There aren’t enough buyers for all the debt.

Whenever governments want to go into debt, they issue bonds.

A bond is just a promise by the issuer to pay you back at a future time - with interest.

But major countries (US, EU, China, Japan) are issuing so much debt that there just aren’t enough buyers.

And what do countries do when no one wants to buy their debt?

They print money.

That scale of money printing needed this time will be one of the biggest in modern history.

That’s why we’re going to have a bull market in liquidity.

But here’s why technology will also take off…

4/ The AI bubble is just getting started.

ChatGPT is the fastest-adopted tech ever (100 million users in 2 months).

And today, AI is still everyone’s highest conviction bet.

5/ To function, AI needs two things: compute power & data storage.

New AI startups are raising billions of $$ and doing two things: buying GPUs and cloud storage.

That’s why the data storage market is expected to 5X in the next few years.

Now - AI could use centralized data storage.

But with centralized data storage:

• you’re at the mercy of fluctuating pricing

• the government could shut you off at any minute

Ok - so maybe there’s a need for decentralized data storage.

And for that, we turn to Filecoin.

Filecoin is the token of the Filecoin crypto ecosystem, which provides decentralized data storage.

It is down 99% from its all-time high - but its’ usage is increasing.

It’s generating revenue - but still has a lot of room to grow.

So Arthur Hayes has taken a position in Filecoin.

He sees it as a way to bet on AI and crypto simultaneously.

By the way - Hayes loves revenue-generating protocols.

And he’s not the only one. Soon, we expect many institutional investors to value crypto tokens the way they value stocks.

Of course, none of this is financial advice. We’re just the messenger.

But Arthur Hayes is fascinating. You can watch his whole speech here.

🍨 Dessert

Stories to read if you have FOMO

1/ Ether Futures ETFs go live

2/ Grayscale moves to convert $ETHE into a spot ETF.

3/ The collapse of FTX in SBF’s own words

📈 Market opportunities

Yield - Beginners 🌾

• ETH: Earn 4% APR by staking ETH on Lido

• SOL: Earn 6.8% APR by staking SOL on Lido

• Arbitrage: $ETHE and $GBTC trading at -17% and -28% discounts to the value of their underlying ETH and BTC.

Yield - Advanced 🌾

• DAI - Earn 11%+ APY on $DAI

• ETH - Earn 17%+ APR with Hop’s ETH pool on Base

• BTC - Earn 14.9%+ APR with Umami’s BTC vault on Arbitrum

Upcoming Airdrops 🌬️💧

• Linea

• LayerZero

• ZKsync

• Polygon zkEVM

📝 Task

Earn BTC for a simple crypto task

Our next task will start this week and run for 48 hours.

So keep your eyes on your inbox 👀 

🖼️ Crypto meme of the day

From across the world wide information superhighway