Nick Tomaino and Kyle Samani Debate Crypto Beyond Speculation

Harry Stebbings brings Nick Tomaino of 1confirmation and Kyle Samani of Multicoin Capital together after a disagreement on social media. Samani says his firm runs crypto hedge and venture funds and is particularly known for its Solana investment; Tomaino describes 1confirmation as an early-stage venture fund.

Asked whether crypto can grow beyond speculation, Samani says yes. He argues token incentives can help finance decentralized physical infrastructure and predicts that economic activity will migrate to decentralized finance payment rails over time. These are his investment theses, not established outcomes.

Tomaino sees speculation as potentially empowering for people excluded from existing financial systems, but says excessive speculation can be harmful. His fund had invested in speculative use cases; he expects the next decade to require products that serve needs beyond trading.

Tomaino distinguishes speculation, which involves putting money at risk, from 'shilling,' or promoting an asset. He cites the collapses of FTX, Terra/Luna and Three Arrows Capital as examples of speculation going wrong. Samani argues that crypto has revealed a large global demand for speculation itself.

Samani says people should be free to discuss assets they genuinely believe in, while avoiding false or misleading claims. Tomaino suggests crypto tribes might redirect some human rivalry away from national or religious conflict; this is his speculative social theory, not evidence that crypto reduces violence.

Tomaino also warns that prominent influencers promoting assets and then selling to retail buyers can damage newcomers' experience and set the industry back. His distinction is between sincere participation and promotion that exploits an audience.

Asked why Solana attracts criticism, Samani argues that Ethereum supporters see it as a credible competitive threat. Tomaino agrees that tribal affiliation plays a part but says, in his view, Solana had not yet introduced a comparably new social vision: he sees Ethereum as a developer platform and Cosmos as a vision of sovereign chains.

Tomaino characterizes Solana so far as a faster, cheaper Ethereum and argues that its exchanges, lending and NFT markets resemble earlier Ethereum applications. He calls himself a crypto purist rather than a member of a particular chain's tribe. His description is challenged by Samani, whose firm has a significant Solana investment.

Samani says the ecosystems have different commercial orientations. In his account, Ethereum's foundation is more hands-off and focused on public goods, whereas Solana organizations actively develop products and features. He argues that more activity by a foundation does not necessarily mean the ecosystem as a whole is more centralized.

Tomaino clarifies that he is talking about organizational structure and ethos, rather than asserting that the underlying system is centralized. Samani agrees the Solana foundation is more likely to respond to a large company seeking technical help; they differ over whether that is a good thing.

Tomaino asks Samani to identify applications uniquely enabled by Solana rather than copied from Ethereum. Samani disputes the premise and starts with on-chain central limit order books, which he believes are important to price discovery and efficient markets. He contrasts this model with the automated market maker popularized by Uniswap.

Samani next points to compressed NFTs, which he says can make large-scale digital collectible issuance cheaper and practical. He cites Drip and approximate Solana issuance figures but does not claim the resulting low-value NFTs are necessarily useful. His argument is that the infrastructure enables experiments at greater scale.

His third example is decentralized physical infrastructure, or DePIN. Samani describes people building a shared network and receiving tokens, with token buyers indirectly funding the network. He discloses that Multicoin led an investment round in Helium, which he says was working to build a mobile network.

Stebbings asks whether Bitcoin qualifies as DePIN. Samani draws a distinction between securing a financial ledger and providing an external service such as mobile connectivity. Stebbings presses him on whether that definition depends on his own judgment about what counts as useful.

Tomaino questions whether the examples have attracted many new users. Samani rejects that premise, citing Hivemapper's road-mapping network and a $20-a-month Helium mobile service. His claims about coverage, cost and uptake are presented as his account, not independently verified measurements.

On whether talent has left crypto for AI, Tomaino says bull-market 'tourists' have departed. His fund prefers founders who have studied crypto deeply, even without traditional credentials, though he acknowledges that conventional Silicon Valley founders can also bring value.

Tomaino calls himself a crypto purist; Samani describes himself as a crypto maximalist who wants widespread adoption and is comfortable with aggressive commercial development and marketing. They treat these labels as different lenses rather than measures of virtue.

Stebbings asks whether copying projects, promoting tokens and selling to retail investors makes authenticity irrelevant. Samani argues that open financial systems permit bad actors but believes their benefits outweigh the harms. He presents this as an argument for permissionless finance, not proof that any particular project is trustworthy.

Tomaino says authenticity is central to his fund's thesis. Open-source products can be copied and a louder imitator may win attention in the short term, he says, but he expects original founders who persist and build something meaningful to earn greater rewards over time.

Tomaino thinks judging authenticity will become harder as AI advances. Samani agrees that authenticity matters but rejects the idea that loud marketing necessarily proves a lack of it. Both contrast their impressions of Coinbase's and FTX's advertising, making clear these are their interpretations of the brands.

Asked whether Multicoin should have recognized problems at FTX, Samani says his firm initially passed on the FTT seed round over concerns about the relationship between Alameda and FTX. After seeing trading activity, the firm reassessed and bought FTT in December 2019. He says they did not see the fraud and regrets missing it.

Tomaino says his distrust of Sam Bankman-Fried and FTX began with a subjective sense that the public image felt inauthentic. He points to celebrity and political associations as signals that made him wary, while acknowledging he did not foresee the scale of the collapse. He also recalls a colleague publicly criticizing a proposed policy initiative before the collapse.

Asked about Binance and Changpeng Zhao, Tomaino distinguishes that situation from FTX and says he was not aware of Zhao harming customers in the same way. The comparison reflects his knowledge and view at the time; it does not establish the full facts or outcomes of the separate matters.

Stebbings asks whether the SEC had unfairly targeted Coinbase and Kraken. Samani says Coinbase first spent years trying to work with regulators and, in his judgment, was right to become more publicly confrontational after being sued. This is his interpretation of the companies' and regulator's conduct.

Tomaino criticizes SEC chair Gary Gensler and the Biden administration, contrasting enforcement against Coinbase and Kraken with the failure to prevent FTX's collapse. He also mentions an unconfirmed rumor about discussions concerning FTX; it is not established by the interview. He adds that he has worked with thoughtful people at the SEC and does not know whether Gensler will leave.

The speakers discuss the upcoming 2024 US election. Samani expects a Republican president would be more likely to appoint an SEC chair with a lighter-touch approach. Tomaino names several then-candidates he considers favorable to crypto and argues that innovation could continue even under an administration he views as hostile, though US participation might suffer.

The panel speculates about Donald Trump and the election, including an unverified prediction that he might run from prison. Tomaino says it remains uncertain whether Trump would be good for crypto and predicts he might embrace it in 2024, citing a Trump NFT collection. These were contemporaneous political predictions, not statements of what happened.

On crypto IPOs, one participant mentions circulating reports that Circle might list in 2024 but says he does not know their basis. The other has no view. Neither presents a confirmed listing plan.

Tomaino expects NFTs eventually to return strongly, potentially reaching wider mainstream adoption than cryptocurrencies because they connect with culture and creators. He suggests a three-to-five-year horizon while expressly avoiding a prediction of an immediate rebound. As an early OpenSea investor, he says he has no strong view on whether its valuation will return to $13 billion.

Asked about assets he considers overvalued or empty, Samani criticizes several major tokens and says their trading volumes puzzle him. Tomaino counters that enduring memes may themselves have value. These are competing investment opinions, not conclusions about any asset's actual worth.

In quick-fire questions, Tomaino says concentrated political and bureaucratic power is his biggest concern for crypto. Samani is most excited by stablecoin payments, which he believes can make dollars accessible to people around the world. Both are expressing views connected to their investment activities.

Tomaino says he changed his mind about on-chain messaging after using a message that persisted across Coinbase Wallet and another application. He predicts wallets will eventually include messaging and that the technology will become a significant use case.

Samani says his lesson is to hold a thesis until it is invalidated and to concentrate bets rather than diversify. He describes Multicoin's earlier investment in EOS as a mistake, saying the firm ignored valid technical criticism. The firm then pursued its high-performance scaling thesis through Solana; this is his investment approach, not a recommendation.

Looking five years ahead, Tomaino hopes crypto will move beyond speculation toward prediction markets, decentralized social and messaging, DAOs and stablecoins. He allows that speculative finance alone could still grow substantially, but wants useful non-speculative applications.

Samani hopes everyone will have a secure private key on their phone for payments and investments across applications. He thinks that may take five or perhaps ten years, acknowledging uncertainty about timing. The discussion closes with the Solana phone, connecting his vision to an ecosystem in which his firm is invested.