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#97 - Backpacking through a new venture, renting escapism by the hour, and other stories

description: Overhead shot: A bowl of mixed nuts, on an orange backdrop.  Photo by Usman Yousaf on Unsplash.

Last week was the monthly media roundup, so two weeks’ worth of web3 news has piled up since the last proper newsletter. I’ll run a few short segments today to catch everyone up.

Try to think of this issue as a bowl of mixed nuts, then.

Getting the band back together. Sort of.

When “creative differences” lead a rock band to split up, most people put their bets on the lead singer’s solo career. Sure, the other members have talent, but the singer is the band’s personality. They’re the group’s voice, both on- and off-stage. The one most likely to crave the spotlight and, as such, the most memorable to fans. WIth all of that comes the (unfair) assumption that the singer was the person in charge, the most ambitious member, and the genius behind all of the band’s music. There’s no way the rest of the band could survive when the lead moves on, right?

And yet, they do. Genesis. Black Sabbath. Van Halen. Each one lost its front man. Each one lived happily ever after. Thrived, even.

Can we say the same for a startup?

That’s the hope for the former FTX team. (Can I call them FT-ex? I’m going to call them FT-ex.) They’re launching a new exchange called Backpack. And before you scoff, remember that FTX didn’t fall apart because of bad code. So there’s hope.

Well, hmmm. Let me reframe that. FTX kinda fell apart because of some bad code written specifically to hide a Big Gaping Hole Where Customer Money Used To Be. But pe a recent trial, this code was known only to folks at the top of the org chart. It’s entirely possible that the rest of the team is a top-notch crew. And they could make a mint if given the chance to run a crypto exchange again.

To be fair, it’s also possible that FTX was not a well-oiled machine (above and beyond “the lost $8 billion” issue) and this new venture will be eaten alive by the industry’s remaining exchanges. But the team deserves the opportunity to succeed or fail based on their own merits. Not on the executives’ desire to spend time in a New York City courthouse.

Maybe they could rename the business to “Genesis” to reflect this we’re-still-good-without-our-old-lead-singer approach.

Oh wait, no. That name already has a reputation in crypto. Never mind.

Preparing his next moves

I should point out that sometimes a band splits up and the different parts continue their winning streak. David Lee Roth (Van Halen), Ozzy Osbourne (Black Sabbath), and Peter Gabriel (Genesis) all did well for themselves after going solo.

Will we be able to say the same about SBF? Time will tell – I mean, the guy is already angling for a reduced sentence – but you can guess where I’m placing my bet.

Perhaps he’ll actually get his way and serve minimal time. He could turn this into one hell of a sin/redemption arc.

And maybe, just maybe, he’ll use his prison time as street cred for a rap career. The kind where he goes straight from the joint to the recording studio. Because Sam really needs to respond to 2022’s diss track of the year, “Declaration Of John J. Ray III In Support Of Chapter 11 Petitions And First Day Pleadings.”

Such optimism

SBF wouldn’t be the only one planning a comeback.

To continue the band analogy, Three Arrows Capital (3AC)’s situation is less “lead singer goes solo” and more “the creative duo decides to change it up a bit.”

Founders Kyle Davies and Su Zhu have been on the run taking some time away since their fund suffered a complete and utter meltdown quietly folded. Well, Zhu had been busy finding himself, until authorities found him back in September). But until then, he and co-founder Davies had been trying to launch entirely new scams Totally Legitimate Business Models.

You have to hand it to Zhu for maintaining a positive outlook on the whole affair:

On Presidents’ Day, [Zhu] reposted the following message on X: “The @zhusu redemption arc is going to be epic and the man has earned every bit of it.”

(By the by, the linked article goes into more detail about the rise and fall of 3AC’s founders. Well worth the read.)

The coin is still up in the air

Remember Do Kwon, from Terraform Labs? Yes, that Terraform Labs, which gave us the Terra/Luna disaster of 2022. Like the 3AC guys, Kwon had been away “finding himself” till he found a Montenegro jail cell about a year ago.

The US has been competing with Kwon’s home country of South Korea for extradition. The latest news is that Uncle Sam won the coin toss and Kwon will leave Montenegro later this month.

That said, there’s still time for another appeal.

No word on whether Kwon is planning a Zhu-style redemption arc. Or a rap career.

In other news …

The wrap-up

This was an issue of Block & Mortar.

Who’s behind Block & Mortar? I'm Q McCallum. I've spent the past two decades in the emerging-tech space. And I'm very interested in web3 use cases.

Credit where it's due. Big thanks to Shane Glynn for reviewing early drafts. Any mistakes that remain are mine.

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