 Crypto assets are here to stay and the money effectively is built into the bubble. Blockchain is obviously the fat protocol, the intelligent protocol. That's not journalism, so don't read those guys. Just don't read them. Hey guys, this is Catherine Ross from Cointelegraph and here with me today in Berlin, Mike Butcher. I'm actually a big fan myself since the very long time. Mike Butcher is the editor-at-large at TechCrunch. You've been visiting a lot of crypto events recently, right? Yes, of course. I mean, if you're a journalist trying to cover this space, it's worthwhile to, you know, go to where the community is. But what did you first hear about crypto? Where? Oh, 2011, 2012, yeah. That early? I mean, it was like in the early stages, right? Yeah, obviously it was mostly Bitcoin then. Yeah, you got interested, right? Yes, of course. Why did you decide to write about it and to cover it? Well, I think what's fascinating about it is that we're all familiar with TCPIP as a dumb protocol, but blockchain is obviously the fat protocol, the intelligent protocol that is effectively going to be the new wave of the future. And it's mainly blockchain technologies and implementations and projects that I'm interested in writing about and covering. And of course, the cryptocurrency market is one aspect of what's going on. Yeah, it is a big one, actually. You've mentioned blockchain projects and stuff, anything you follow, anything you cover, like maybe something you're fascinated about, the projects that are going on right now. Well, I think the sort of the general theme of decentralization is really fascinating. You know, we've had Google, Apple, Facebook, Twitter, Amazon, effectively be the centralized networks for the last 25 years of the development of the internet. And what we're doing now is we're looking for the decentralized players of the future. I mean, the fascinating ideas, for instance, you could create a decentralized Uber, which will be an incredible kind of move. And so the exciting thing about it is how we'll have brand new actors. There's a lot more sort of collaboration, of course, between all of these projects than in previous systems. So that's why it's so amazing. I mean, it's so nice to hear that you're a fan of the industry. I mean, yeah, you have not only generally interest. So the crypto market itself is kind of immature. I'm sure you can tell, right? Of course. So you saw the beginning of the tech market. Is it something that you're seeing right now? Like, you know, the tech market is evolving, has been evolving, and the crypto market is so immature. And so is this like the same, the same kind of bubble? Yeah, it's very similar to previous bubbles in many ways. What's different about it is the amount of money that's cut in this space. And, you know, previously in the sort of the mid late 90s, in order to be able to work in the internet space, you had the rails raised, you know, proper real money, and that was a different kind of era. And but now to be evolved in this era, it requires, I mean, the money is effectively is built into the bubble. Yeah. And so that's why it's so fascinating and potentially dangerous for some people, given that so, you know, there's such a lack of sophistication amongst people who want to be involved in this space and month, whether or not they're investors, or people who want to be involved in ICOs or whatever. Your speech was about the disinformation, right, in the market and in the media, because there are not many crypto media outlets yet. I guess we are evolving, going to our graph ourselves. And I think that we have been accused a lot about trying to manipulate the market. So my question is from you, to you, like from a fellow journalist is how to protect the media project about this accusations. Like we're not trying to influence the market, we're trying to inform you guys. But what we get is like, guys, you're trying to manipulate the market. So is the same like you saw in tech or probably in the financial markets when the news comes out and stock plummeted, for instance. So is there anything we can do about it? What do you think? Well, I mean, in the way that the traditional financial media have operated is that there is a separation of powers between journalists who write content and news and advertising people and commercial people and they don't talk to each other, right? Sorry, no. So in fact, you're not allowed to talk to each other. And if you do talk to each other, then that's a conflict of interest. The people who advertise on a website go through the commercial people by advertising and they speak to the client or whatever. The people who write the content shouldn't be talking to those people. They should be actually writing about what's going on and then they're paid by the media organization. That's how journalism has evolved over the last 200 years or so, roughly. And so if a media outlet is abiding by those rules, the separation of powers between advertising and editorial and if journalists are not being paid to write about companies specifically that they're being paid generally as a salary to write about what the news is, then that's okay. If there is any change in that and if there is a... If journalists are being paid to write specific stories, then that's not allowed. That's wrong. It's not journalism. That's not journalism. And so don't read those guys. Just don't read them. And I'm sure that you guys are abiding by those rules. And so the markets obviously and the crypto are moving every day. It's kind of a pretty crazy world out there. And it's behoving on us as journalists to make sure that the bad actors don't get any promotion. And that there is, like I said, there's an independence out there. One part of the problem, of course, is that the journalists aren't just part of the media space anymore. You have all these telegram groups. You've got all these WhatsApp groups. You've got online bulletin boards of some description or another, whatever it is, messaging services. And those are the problems. That's where a lot of the problems develop. But I do think it's... Part of my talk was that if we don't pay attention to this, then decentralization and blockchain technology won't be trusted. It won't ever go mainstream because it won't be trusted by anybody. And so it's everybody's job in the industry to promote good media. Media that actually has a separation of powers between advertising and editorial and that is independent. It's our job to do that and to de-emphasize and detune the bad actors in the space. Do you have any examples about the actual manipulation that you saw that probably media wrote about something and the token went down or up? Well, I think there are... Let's face it, there are a few examples of this going on. Anyone can set up a blog. Anyone can set up a medium account. So there's multiple examples of that going on. But what you've got to do is double down on the better sources out there and use them as how you work out what's going on in the market. I mean, the main idea is that I hear problems that you can read the articles on medium or any other blog but you need to be cautious, right? That's the message. Absolutely. I mean, the phrase buyer beware is always out there, isn't it? Check some balances, always do your research. And I think really even the most sophisticated investors today find it difficult to know what's going on. And many of them are extremely cautious actually about how they operate. Not much more cautious than the average person. So, and I think what's going to happen is, is that if more problems continue to happen, then regulators will come in, then there will actually be very heavy-handed regulation and some of the more innovative aspects of what's gone, what's happened in the last few years might be stamped on, you know, and they might change. Yeah, yeah. So it's up to the industry to get its own house in order. Speaking about regulations, you know, a lot of people have been talking about the space being not regulated enough but at the same time people are wondering that it's regulated enough or unfair. What is your point of view on that? Well, it depends on whose regulation you're talking about. You know, it's not regulated in the U.S. at the moment because it's actually effectively cut off from the U.S. Well, the SEC are trying to do something, right? The commission is trying to regulate the ICOs and they're trying to regulate the crypto investors some, I guess American citizens are not allowed to participate in some ICOs at this point. I mean, of course, every country has its own regulations but in general, I mean, this space really needed or it's going to evolve by itself or it's very dangerous and it needs to be regulated more. What do you think? Well, it depends on which jurisdiction you're talking about. You've got, ZUG became very famous because it was able to regulate ICOs. You've got Gibraltar and Malta, both becoming quite big in the space and of course Singapore, also Korea. So it depends on which regulation you're talking about and where it's happening. Generally speaking, I think there is a sort of a race on now. Even larger nations like France and the U.K. are looking extremely seriously at how these cryptocurrencies and ICOs can be regulated in a fashion which protects investors and protects the consumer. There's going to be a race on, whatever happens, there's a race on. Crypto assets are here to stay. That's absolutely true. The question is who's going to have the better regulation and I think it's going to be interesting because the amount of volumes that will go through when a very large country like France or the U.K. gets involved could eclipse more forward-thinking regulators in other places. But what we'll see, we'll have to see. Yeah, also true. And from the government's point of view, do you think that governments need to embrace the industry to help it evolve? Or because different countries definitely have different points of view. So should they embrace the industry, help it, I don't know, develop or maybe will we benefit? Well, I think that many are. You've got the EU launching its new blockchain observatory, for instance. The Bank of England has got a fintech sandbox that's looking very seriously at the space. So they are engaging and I think they're engaging as much as they can with the best actors there are out there. As I said earlier, I think it's behoven on the biggest players in this space to also engage with regulators and policymakers about what's going on themselves, rather than ignoring that because it might come back and hit them in the face. Also true. Okay, you're a very, very well-interviewed. You know that. By the way, have you ever heard the comparison of the derivatives? I'm very nervous. Sorry, have you ever heard about the derivatives markets being close to the crypto markets? Have you ever heard this? Well, there are some parallels, aren't there? Do you think it's facing the same regulations and the same attitude? Well, I mean, if you look at what's probably going to happen in the next year or so, the next few months, the next year, crypto assets will probably eventually be regulated like other kinds of assets to some extent, depending on what they are. You've got some of the biggest players, like Goldman Sachs becoming involved, launching their own trading desk for things like Bitcoin, for instance. So that's clearly going to happen. And then you've got sovereign wealth funds becoming involved as well. So I think that the legitimacy of the space is coming. It's not there quite yet in some places. But it makes a lot of sense if you think about it. Even sci-fi writers have been talking about the idea of having global currencies, which aren't fiat currencies, which are, we've all heard of credits and things like Star Trek and Star Wars. So it's clearly that it's an idea that's, who's time has come. Okay. You've obviously visited a lot of events, as I said before. And you've met a lot of people from the crypto industry. Is crypto community and crypto industry different from other communities? Are people different here? Probably more engaging or more closed? It depends. I mean, if you've got, talking about blockchain projects, they remind me of the early internet space with developers coming up with fascinating new ideas. Then you've got people much more involved in crypto as a currency side of things. I think, yeah, it's absolutely, it is sort of different actually from the traditional, so to say startup space where you have an entrepreneur and a venture capitalists. But the thing, the two are merging. If you think about six months ago or a year ago, the ICO space took off extremely quickly. Oh yeah. And everyone was actually quite blindsided by how quickly it took off. And even traditional investors saying the venture capital space weren't really being involved. Now what's going on certainly with private sales, private ICOs is that you've got more traditional investors both becoming involved at the earliest phases of an ICO. They're the private sale. And actually, sometimes even the public sale gets canceled with telegram. Or the public sale is changed or different. Or there's a sort of 50-50 relationship later on with the public sale. And ultimately, if you want to build something, if you want to be an entrepreneur and you want to build something, you don't just make some money from an ICO and then go and build it. What you do is you bring on other partners to help you build it. People who have networks and relationships that you don't have as an entrepreneur. And that really does require professional investors. Oh yeah. Because they have the contacts, they have the know-how, the knowledge, they have the partnership relationships and the experience about how you scale the company. All the stuff that everyone is familiar with in the startup space. So the worlds are actually gradually starting to merge a bit. Okay, that sounds exciting, isn't it? Yeah. And the guys actually from YouTube team ask me to ask you, what is the best way to benefit from the conference? So obviously it costs a lot for a participant to come here and to be involved. So any advice on how to, I don't know, talk to people on how to get the best of it? It's always the same at every conference. Just, you know, learn how to network, learn how to introduce yourself. Well, I mean, I think the best way to do these things is just to introduce yourself, but talk about the issues, you know, it's display your knowledge. Yourself. As soon as somebody starts pitching at you or selling, it's kind of discouraging. It's kind of discouraging. So I think it's more interesting to have a conversation first and show how clever you are. Okay, that's a new one. That's the noise we haven't heard before. Okay, we are very, very honored to be here with you. Thank you very much for the interview. We're here in Berlin at Block Show with Mike Butcher. Thank you, guys.