Ep 51, An Early Technologist’s Perspective on Investing —with Joey Krug of Augur & Pantera Capital

It’s no surprise that Joey Krug is a fan of taking calculated risks. After all, he was betting on horse races (and winning) in middle school and eventually created a mechanism for making bets on the blockchain. As an early crypto developer, Joey had the opportunity to meet a lot of promising entrepreneurs. And ultimately, he put together a syndicate to invest in the projects with the most potential.

Joey is the creator of Augur, the decentralized oracle and prediction market protocol built on Ethereum, and the Co-Chief Investment Officer with Pantera Capital, an investment firm focused exclusively on ventures related to blockchain tech, digital currency, and crypto-assets. On this episode of Wyre Talks, Joey joins us to discuss the inception and early days of Augur and explain why the team chose to raise money through an ICO — the first on top of Ethereum. He describes how Augur has evolved, shifting from a reporting to a dispute-based model, disincentivizing invalid markets, and incorporating the use of DAI in V2.

Joey goes on to address how companies building on Augur are tackling US regulations and offer his take on what should and should not be regulated by the government. He also covers the advantages of using Augur overrunning a centralized operation, sharing the benefits for users in terms of limits, odds, and fees. Finally, Joey walks us through his transition to angel investing, explaining how he came to work with Pantera and how he evaluates investments with regard to team, product, and market. Listen in for Joey’s insight around the prerequisites for DeFi mass adoption and learn about the scalability projects he is excited to see the launch in the near future!

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Follow Augur on Twitter: https://twitter.com/AugurProject
Follow Pantera on Twitter: https://twitter.com/PanteraCapital

Today’s Topics

[0:30] Joey’s introduction to Bitcoin mining and building on Ethereum

[3:36] The inception of Augur

[4:59] Why Joey’s team pursued a crowd sale to raise money over venture capital

[6:15] How the Augur team created an incentive model around its tokens

[7:15] The profile of the average participant in the Augur ICO

[8:01] Augur’s shift from a reporting to dispute-based model and reduced dispute period

[10:23] How V2 of Augur is disincentivizing invalid markets and allowing the use of DAI

[13:23] How Joey’s day-to-day involvement in Augur has changed post-ICO

[14:56] The pros and cons of running a distributed team

[17:34] Joey’s insight on deciding what Augur should build internally vs. what external developers should build

[19:30] How companies building on Augur are tackling regulatory issues in the US

[20:56] The advantages of using Augur overrunning a centralized operation

[22:25] The benefit of Augur for users in terms of limits, odds, and fees

[23:20] Joey’s insight on political events + sports as the premier use cases for crypto prediction markets

[24:30] Joey’s thoughts around what should and should not be regulated by the government

[27:20] How the team is building compliance tools into Augur

[28:48] The tradeoffs Augur is making to maintain a sound regulatory position in the US

[30:52] How Augur’s solution to the oracle problem differs from that of UMA

[33:47] Joey’s take on the problem of parasitic use of oracles

[36:03] Joey’