There's a audio version of this blog post, hosted on YouTube:
Tough Times
I’m not going to lie, the last couple of weeks have been tough as a VVV holder. Since the launch of DIEM the price of VVV has fallen 46% from $4.78 to $2.59. We’ve re-traced the entire run-up that we had building up to the DIEM launch. It’s disappointing that none of the DIEM launch interest materialised into an upwards re-pricing.
Honestly, the post-DIEM era of Venice sucks. It was better before!
I’m left worrying - Are the pumpamentals of VVV ruined?
The story of the venice token used to be simple and interesting; Buy Venice and get access to a slice of Venice compute. No-one knows what VVV is anymore. What does VVV do now? All it does is allow minting of DIEM, which has questionable worth given that if you need DIEM you can buy it on the market much cheaper.
Given that DIEM is range bound, and that VVV is used to mint DIEM, doesn’t this also make VVV somewhat range bound as well? Why should the price of VVV go up when all it can do is mint DIEM which can’t go up very high?
Why can’t DIEM go up high? Well, If a bot wants AI compute, and DIEM is a bit expensive, it’s just going to get it’s compute from elsewhere. It’s not going to buy DIEM and it’s certainly not going to buy VVV to mint DIEM.
Didn’t we throttle our upside? Hang on… Did we kill the pumpamentals of VVV?
I'm here to tell you: No! Stay strong. This is no time for weak hands! Conviction conviction conviction. Markets climb a wall of worry.
There's plenty of reasons to hold strong.
VVV is amazing. Not only can you mint DIEM with it once, but you can keep on minting more DIEM as time goes by if you stake your VVV yield. The Bank of England has a money printer. With VVV you also have a printer. A printer of AI. A printer of daily thinking time. Accumulating VVV now, at these low prices is a gift.
The pumpamentals haven’t changed. Most VVV holders didn’t use the API but they held hoping that other people would want to use the API and this would cause buy pressure. It’s the same today. The story hasn’t changed. But now the rules and mechanics are clear and transparent and that’s a good thing.
I believe in the founder. Erik Voorhees is full of common sense. He’ll build something cool, don’t worry. There’s no VCs, Voorhees is the sole investor (source) so there is no time pressure for Erik to get it right. DIEM was pivot 1 of n. Venice is a WIP. I have the chance to get it before it’s perfect. When the team perfects it, the opportunity to be early will have closed. Buy while the project is early. HODL. Belief in something. If Venice doesn’t work in it’s current form then there will be future pivots to improve the project.
Our ignorance about how to build useful artificial thinking software is only going to decrease from here. Venice is going to get better and better. It’s standing on the shoulders of growing giants and it’s growing itself and it’s got AI to help it grow. It’s got a rosy future. But the thing I keep coming back to when I think about the AI space going forwards is Ads. It’s inevitable that the big players in the space are going to switch on Ads at some point. Antrophic is valued higher than Disney. One reason it’s so highly valued is because the marketing people are salivating at all the prospects of using AI to shill you stuff. How insidious it is going to be makes me shiver. I don’t want to use an AI that works for them. I want to use a AI that works entirely for me. Otherwise I can’t trust it. It’s corrupted.
AI supplied by your phone provider, or a megacorp, is a dystopian nightmare.
How far away are Ads in AI? 1 year? 2?
THIS is when Venice is going to come into it’s own. This is when it’s going to get product market fit. This is when Eriks vision is going to make so much sense. He can see what's going to happen, the enshitification of AI. He’s playing the long game, positioning Venice as a product that can offer a credible alternative. The best founders build something for an itch they want to scratch. Venice is important.
Yes the price action has been brutal. Suck it up. Buy VVV, Stake it, compound your yield and your future self will thank you for playing the long game and having a ticket out of being shilled stuff you don’t need by the smartest super computer on earth. That’s what I’m doing.