At a convention in Singapore called “De/Centralize,” over a marathon two days, more than 80 speakers take the stage to talk blockchain. The speakers are CEOs, PhDs, developers, coders, social workers, investors, venture capitalists.
Then Meltem Demirors is introduced. The ballroom quiets. “That’s the Sheryl Sandberg of crypto,” one woman says to me in a whisper. Phones are whipped out, photos snapping. It’s not quite the blockchain version of a Drake concert, but the audience can sense a star.
“Decentralization is a myth,” Demirors says to the crowd, well aware that the title of the expo is “De/Centralize.” She sprints through a few slides to prove her point, each one packed with data: The top 100 bitcoin accounts hold almost 20 percent of the tokens, 80 percent of all market value is captured by the top seven protocols, and so on. “Crypto is actually really, really highly centralized at every layer of infrastructure,” she says in her rapid-fire voice. “At the protocol layer, at the networking layer, and at the application layer.”
This is the kind of real-talk that has helped turn Demirors into what they call an “influencer.” In 2014, she helped launch the blockchain investment firm Digital Currency Group, and later hung her own shingle at Athena Capital. In her spare time she’s a guest lecturer at MIT media lab, is a member of the Davos World Economic Forum, supports diversity in the crypto space through her “Leader Series,” and devours hard sci-fi. (“Has anyone read the Eon series by Greg Bear?” she once tweeted. “If so, DM me, I have serious questions about book three and it’s driving me insane.”) CryptoWeekly named her the #57 most influential person in crypto, and a well-known blockchain publication, Glamour, profiled her in their feature “Cryptocurrency Is Not Just a Boys’ Club.” (Weeks before the piece came out, she told me, “It’s really cool. I look like an alien, like an airbrushed alien.”)
Demirors is not afraid to call out bullshit, about crypto or investing or anything. “I think the greatest thing we can do, when we’re having a conversation, is to take the proverbial mask off,” she tells me. “This has been a recent change I’ve made in my life, where I just don’t give a fuck.”
Yet that’s not quite true. She clearly does give a fuck about bitcoin, the community, and bringing methodological rigor—transparency, data, and intellectual honesty—into the loosey-goosey crypto space. While dropping a delightful amount of F-bombs, Demirors geeks out with me about why she still loves bitcoin, why a bear market is healthy, the need for more data, and why she is not the Sheryl Sandberg of crypto.
You spent a lot of time investing in a raging bull run. What are your thoughts on the bear market?
I think we’ve gone through this orgy of unfettered capitalism. And [the space] has become very tone deaf. It’s become very illogical, and frankly, it’s become unproductive. We’re throwing good money after bad. I’m excited about a period of depressed prices where we can focus on really building. Now we need to bring some rationality, pragmatism, and risk management to the crypto asset space.
So there’s a sneaky upside to the bear market?
100 percent. There’s a book by this woman, Carlota Perez [Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages], who’s a researcher at MIT. The book shows a paradox in technology: You see this boom in financial capital, and then production capital doesn’t catch up. And then the bubble pops, and they realign. It’s a mismatch in timing between financial speculation on new technology, and the actual time it takes to produce the technology.
Like with the dot-com bubble. I should read that book…
It’s great. And you should also read this 1976 white paper, from Jensen and Meckling: “Theory of the Firm.” It’s about incentives, management, and how firms should be structured.
What’s the takeaway?
That the incentives of management and shareholders have to be aligned, or else you create dysfunction within the firm, where people maximize their own value rather than that of the firm’s. So I’ve been thinking about that in the context of crypto assets, right? We have all these really interesting problems with agency. And so that’s the problem I’m interested in solving. How can we bring ethics and behavioral psychology—and also more discipline—to this ecosystem to make it more approachable, and to actually have us achieve the vision we set out to create? Because a lot of what we’re seeing right now is scamming and value disruption.
Can you elaborate on the “agency” problem?
Number one example: You saw a bunch of presentations yesterday?
Okay, did anyone put disclosures at the start of their presentation?
[Onstage, Demirors had shown a slide that listed the coins she was invested in.] Right. To me, it’s all about transparency. So, I’m a capitalist. I like making money. But I’m going to be very transparent. There’s a fine line between being excited about technology in a project, and being excited about making money because of that project. It’s fine to promote things, just disclose it.
What other challenges do you see in the space?
People are doing a lot of talking and pontificating, but they aren’t actually gathering data or refining the questions. I want to focus on asking better questions.
What’s an example?
Instead of asking, “Oh, what’s the supply schedule for this token?” really, the question should be, How are we thinking about manipulating supply over time? What are we going to do as the market changes? This is a broader question.
Right. What else?
No one’s thinking clearly about the computational capacity required to support and implement a network. So I’m an investor and adviser to this company called BlockDaemon. They create on-demand blockchain infrastructure. We’ve been riffing a bit on the actual computational costs supporting a network. And what we found is that a private blockchain network with just 20 nodes can cost as much as $500,000 a year to run.
And then there are transaction costs on top of that?
Right. I look at it like the way you would in traditional finance. The way you think about an investment is that there’s capital expenditure—which is hard infrastructure—and then there’s operational expenditure, right? That’s the ongoing maintenance and cost. A lot of people are so focused on just deploying the network that they forget about the ongoing operating cost. And if, computationally, your network’s really expensive to run, people are not going to use it, right? So I think, again, that the intractable relationship between the design of your protocol, the implementation of your network, and the way applications leverage the network is such an important part of how we design things… but people just don’t think about it.
Does that strike you as an existential problem with these models?
I think it’s just an immaturity problem.
Are there any existential problems in the space?
[She pauses.] A large part of the bitcoin ethos is privacy, right? And like, “fuck the government!” and Let’s have money for private citizens to engage in private peer-to-peer transactions. Now the irony is that by using the public ledger, we’ve actually introduced this idea to government that we can track and trace all flows of money on a public network, which is the exact opposite of what we set out to do.
That’s a hell of a paradox.
It makes my heart stop. That sounds like a totalitarian dream. I’m like, “Holy fuck, this sounds like Minority Report.”
Black Mirror, Season 4.
Yeah. Wait, are we on Season 4 or 5? I lost count. I don’t watch TV anymore. I don’t have a life. I don’t sleep. I don’t exercise. I starve or I feast.
No guilty pleasures? Your presentation yesterday had a Settlers of Catan theme to it, and you said you played the game and are competitive.
I’ll confess that I once played Settlers of Catan at a bachelor party for like eight hours.
Okay, you’re a loser. [We both laugh. She’s not wrong.]
How do you break up your time? What’s your routine like?
I’m not an extremely structured person in terms of how I allocate my time. But I usually wake up fairly early, like six or seven, and spend the first hour or two of my day just reading.
What do you read?
Twitter, Hacker News, a few telegrams, and typically I have 30 tabs open in Chrome. I typically have scribbles in my notepad from the day before of stuff I want to check out. And then a new thing that I’ve been doing is spending an hour a day just reading a book, fiction and non-fiction.
You’re a sci-fi fan, right?
I looooove sci-fi; I’m on a big sci-fi kick right now. You need those mental breaks. Especially since I don’t prioritize sleep—an ideal night for me is five hours. I’m happy with two or three, and then once a week I’ll do a binge and sleep for eight hours. That’s my habit. But you know what really helps, now that I’m in my 30s?
Well, I’ve always been a coffee drinker, but Botox really helps. Getting some light help from your surgeon. Because then you don’t look tired. [Laughs.] And I use a lot of skin care products. You can create the illusion of being well-rested.
"People always say to me, 'Oh, there aren’t women in crypto.' And I say, 'There are a lot of women in crypto, they just work for petty tyrants.'"
I love it. So you’re now a “personality” in the crypto space, and an “influencer”…
[She rolls her eyes.]
Do you feel any added pressure with that? No anxiety about censoring yourself?
I never censor myself. So my number one ethos is like, I do not give a flying fuck. I just don’t give a fuck. Early in my career I was told that to succeed you have to Wear this, Do this. Now I’m like, “Look, I am who I am. If I wanna say, ‘I’m gonna shove ten dicks in my mouth today,’ I’m gonna say that. Let me be myself.”
You’ve used your platform to help promote other women in crypto, with your Leaders Series on Medium.
That has been so fun.
Why is the series so important to you?
People always say to me, “Oh, there aren’t women in crypto.” And I say, “There are a lot of women in crypto, they just work for petty tyrants.” And now we’re in this stage where all of these brilliant women are leaving the companies they used to work for, and starting their own thing. So I’m just trying to create a network to support other women and help them get awareness.
What advice would you give to someone starting out in this space?
Ask good questions, and engage. A lot of people will get involved in crypto on a very surface level. And I’m like, lean into it. All of the parts of it that scare you, that freak you out, and all of the parts of yourself that scare you and freak you out…lean into that.
You just said “Lean In.” You’ve been called the Sheryl Sandberg of crypto, so…
Who said that?
It’s out there!
Oh, my god.
You haven’t heard that?
No. I read the first chapter of her book and I just…I couldn’t. Look…The whole ‘women’ thing. I find that such garbage. The fact that I have a vagina has nothing to do with my intelligence and my capability. Nothing. [Laughs.] No one asks you if you feel a certain way because you have a dick.
So you’re not super fond of the question, “What’s it like to be a woman in crypto?”
That to me is the laziest question, and it’s insulting. It’s insulting. What’s it like to be woman in crypto? I’m like, What’s it like to be a man in journalism? Sorry, I’m not PC. [We both laugh.]
Actually, I’m not. Sorry.
I'm still in love with bitcoin. The idea of bitcoin is what originally captured my imagination. It still continues to excite me; the idea that I can live in any part of the world, and with an internet connection, I can engage in true peer-to-peer commerce. And I don’t need to ask permission. I can do it 24/7.
It’s like you said…You just don’t care!
[She pauses.] Hmmm. But I do care. I really care about people. I care about human dignity. Everyone has the right to dignity, and everyone has the right to be recognized for their unique perspectives, talent, and experience.
Do you see a link between crypto and furthering that right to dignity?
I’m still in love with bitcoin. The idea of bitcoin is what originally captured my imagination. It still continues to excite me; the idea that I can live in any part of the world, and with an internet connection, I can engage in true peer-to-peer commerce. And I don’t need to ask permission. I can do it 24/7. I don’t need to go to the bank. I don’t need to have a government-issued identity. I can do whatever I want. For so many people in our world, especially women, financial freedom and financial privacy are non-existent.
On that note, what’s your short-term, medium-term, and long-term vision for the space?
Short term: more pragmatism, a whole lot of tough love, and a lot of pain. Like the regulatory issues overhanging in the space—it’s just insane. It makes me sad in some ways, but washing out some of the speculative aspects of this will be important. And I’ll admit, I got caught up in it for a bit. It’s kind of addictive, right?
It’s addictive as hell. Medium-term?
Really starting to develop a body of knowledge around crypto that is less “hand-wavy” and more about data-driven insights. Here’s our hypothesis, and here’s how we’re going to test it, and I’m publicizing the results. Make it more rigorous and scientific, so we’re actually supporting some of our pontification and philosophical rambling with actual data, which will give us credibility.
Crypto assets will become an institutional asset class just like anything else. Margins will get compressed. This space, like everything, will become a low-margin, high-volume kind of business. There are going to be crypto assets that are institutional, but then also privacy-focused implementations that are libertarian and anti-establishment, and we can have both.
Interesting. Most people think that crypto will be institutional or anti-institutional, but you’re saying it can be both… this and that.
I’m not in the Either/Or Camp. I’m in the And Camp.
I have one more “existential” question for you about bitcoin, and maybe it’s a silly one. Bitcoin was originally perceived as valuable because it can be used for transactions. Now, though, it’s considered a “store of value.” Yet the underlying value is its ability to be used as a transaction, and if people cling to it as a store of value, by definition, then they won’t transact with it, thus defeating its original purpose. How do we get around this dilemma?
Yeah, and I think, actually, that’s not just a bitcoin dilemma. It’s a dilemma with a lot of tokens that rely on the concept of digital scarcity. I don’t know the answer to that question.
I don’t either.
I also think it’s an irrelevant question right now. Why don’t we think about it when we get there? I think that day is so far away, to be totally candid. I think that it’s two or three iterations away. To me, the bigger issue is: How do we even get people to perceive it as a store of value? How do we even get people to consider it as an option for payment?
Right, it’s still early days…
On the macro scale of things, bitcoin is still infinitesimally small. It’s not even a blip, right?
[The time is up, we exchange pleasantries, say our goodbyes, and as she heads to her next meeting, she waves and says…] I’m just a random speck of dust, floating around, trying to figure stuff out in my little corner of the universe.
Jeff Wilser is the author of The Book of Joe: The Life, Wit, and (Sometimes Accidental) Wisdom of Joe Biden. Follow him on Twitter. Photo by John Cafaro.