The middle of a crypto (and broader financial) market meltdown is perhaps an apropos moment to introduce my second podcast guest: Muneeb Ali, the co-founder of Stacks.

Stacks is a "Bitcoin L2", meaning a system for scaling and expanding the usefulness of the bitcoin network, by making it less expensive and more programmable.

The "Slow Hunch" that Muneeb has followed for over a decade is the idea that blockchain networks can and will be used for more than just financial transactions.

USV invested in the the precursor to the Stacks project back in 2014 -- at that time, the focus was a project called OneName, which can be thought of as an "app" (for digital identity) on top of what would become the Stacks "platform".

We believed then, as we do now, that cryptonetworks and blockchain technology are not just financial technology but also "internet" technology and will, over time, change the way that many internet applications are built.

This has indeed been a slow hunch so far. In 2014, the technology infrastructure was so far away from supporting consumer use cases in a smooth way. One could argue that that's still true today, a decade later -- though the advances, especially in the last 2 years, have been remarkable.

Aside from the "if" of this slow hunch, there is the "how". In 2015, Ethereum launched on very much the same thesis of a highly programmable blockchain. And over the years since, it has used an "L2" (aka Layer 2) approach to scaling -- with a highly secure, but slow and expensive base layer, paired with an ecosystem of faster/cheaper L2s on top.

Where the Stacks project has differed is in this approach -- believing that Bitcoin makes more sense as the base layer, given its simpler approach and more reliable security. Muneeb and the Stacks team believe that this approach is more consistent with the "stack" of internet protocols, built around the highly simple, but extremely durable, IP protocol.

I hope you enjoy my conversation with Muneeb.

Get the episode on Spotify / Apple / RSS / Youtube

Today I'm excited to introduce two things:

1/ I'm starting a podcast series along the same theme as this blog. The Slow Hunch Podcast will dive into the twists and turns, ups and downs, near misses, minor miracles, and personal plights behind the stories of "overnight successes", big breakthroughs, and ideas that in hindsight seem obvious but weren't always that way.

2/ Could not be more thrilled to welcome my first guest on the pod, my old friend Fraser Kelton.

Fraser and I first worked together a decade ago when USV invested in his last company Koko: an AI company focused on mental health that was ultimately acquired by Airbnb. My time working on the Koko board was a major introduction for me to the ML / AI tools & techniques of that earlier era. During Fraser's time at Airbnb, OpenAI released their seminal research that paved the way for what we now think of as modern AI / LLMs. Inspired by this advance, Fraser joined OpenAI as Head of Product and was part of the team that launched ChatGPT and changed everything. He's now a partner at Spark Capital, on a mission to support founders on their journeys of discovery.

I hope you enjoy the conversation. You can find the podcast here, which includes links to Apple and Spotify for audio. And you can find the full video conversation on Youtube, and embedded below.

A few months ago, I started working with a coach, which is something I probably should have done a long time ago. We recommend it broadly for CEOs/leaders in our portfolio for a reason.

Last week, we were talking about my strengths and weaknesses, and Alisa suggested something simple, yet profound, which was: looking for ways to move things that I know to be weaknesses into the strengths column, by changing how I approach them.

In my case, I tend to be stronger at collaborative work, and somewhat weaker at solo work (this is a generalization but a decent enough one for these purposes). Said differently: I really give and gain a lot of energy when working collaboratively / live on things with others, and have a harder time prioritizing and motivating on things totally on my own.

So, one way to handle that knowledge is to work on ways to improve directly on those solo things -- for example, by blocking time on the calendar more effectively, making better use of AI tools to speed certain tasks up, etc. It's obvious to begin by focusing in this direction, which you could bucket as the "strengthen the weakness" approach.

A perhaps less obvious approach would be to "move the weakness to a strength".

For example: every quarter at USV we update our internal valuations of all of our holdings, and each partner does this independently for the investments they manage. For no good reason, I tend to fall behind on this and do it at the last minute, and it's annoying for everyone.

Today, I got on with one of our fantastic finance team members, and together we went through my list. This had a multi-part benefit: 1/ it got done, and quickly; 2/ by doing it together, we actually investigated a flagged a few things that required follow-up from others on our team and 3/ it was fun.

So, what we have decided to do going forward is: rather than the finance team bugging me to remember to do these myself each quarter, we're just going to pre-book a 30 minute call to do it together, which will be a much better approach for all the reasons I mentioned above.

In this particular case, I feel so so lucky to have the benefit of an amazing team at USV, where I can really leverage this particular strength area (not just my own, but ours as a team).

But regardless of the particulars of any person's strengths and weaknesses, I'm intrigued by this idea that in addition to just focusing on improving our weaknesses, we can also look for opportunities to replace a weakness with a strength, and that may end up being the more realistic / effective path.

We are living in a wild moment as it relates to the intersection of computing and humanity.

I have been thinking of it in terms of the “superpowers” we are about to unlock. (For the moment I’m mostly thinking about personal/consumer superpowers, vs more systemic or industrial)

Broadly, I think if two categories of superpowers: AI and crypto.

The AI superpowers are more immediately tangible, and include:

• Talking (via voice, chat or otherwise) to computing devices of all kinds and getting a crisp, informed answer
• Not having to worry about how or where your personal information is stored, yet being to access all of it seamlessly and instantly
• Having super high quality help immediately available for nearly any task

Crypto superpowers are a bit less visible, and many of them may not fully kick in on a consumer level until there are more established network effects, but they include:

• Being able to digitally transact, seamlessly across apps, products, and borders. This spans all types of “transactions” — payments, earning, social gestures, etc
• Related: Having a digital identity that works seamlessly across apps, services, protocols and borders -- and that is "owned" by you directly
• Having the ability to discern the provenance of certain pieces of data and content (eg via zero knowledge proofs and other forms of cryptographic attestations) — will be increasingly important with more AI!

Interestingly, AI and crypto superpowers have something in common: they both increase interoperability and composability of digital system, artifacts and assets. But another way: they both break down annoying digital silos, albeit in different ways. AI connects digital systems because language (via LLMs) is the ultimate interoperability base layer. Crypto connects digital systems by putting digital identity in the hands of the user, and by the open source automation of digital interactions (aka smart contracts)

I am so excited for both of these paths to continue developing — in parallel and then together.

I’m not one to make big annual predictions, but one thing that seems likely to me is that 2024 will mark the emergence of mainstream apps powered by crypto that are less “crypto-native” and more “crypto-enabled”.

By “crypto-native”, I mean apps & experiences where the crypto is the main point, and where a large part of what’s going on is the road-testing of crypto-economic and decentralized computing primitives. You could characterize most of what has gone on over the last 10 years as largely “crypto-native” explorations: defi, mining/validating, DAOs, MEV, minting & trading NFTs, various hacks, exploits and shenanigans. Basically a decade of exploring the adjacent possible now that we have an ability to build trustless, permissionless, autonomous computing systems with native assets. This has been incredibly important because these systems are both powerful and complex, with tremendous possibility but also many new failure modes.

I believe we will now begin to see more “crypto-enabled” applications. These are applications that not only built on crypto, but could only be built because of crypto. And also where the crypto plays a supporting rather than a leading role. Crypto-enabled applications will, on the surface, look and feel like traditional web 2 applications, but they will have super powers. Examples of this will include international payments on stablecoin rails, marketplaces of all sorts (lending, ride sharing, crowdfunding, etc) where the financial mechanics are on-chain, transparent and open to all, loyalty w digital assets & financial rails baked in, and web3-native media & social applications where users have more control over and economics in their digital output. Given the recent advances in scaling (fast and cheap L1s and L2s), security (transaction scanning, insurance), and user experience (cloud wallets, account abstraction), it’s now possible to build these kinds of applications.

I’m excited to see what will be built in the “crypto-enabled” area. I think these applications have the potential to both re-architect digital experiences in ways that provide new benefits to all participants, and also to help advance a more positive narrative about what crypto can make possible.