Gautam Sharma

Ex McKinsey | Ex BH Digital

[Tomasz Tunguz @ttunguz]

NVidia is now the 6th largest company in the world ; but its most important buyers are shifting. https://t.co/t2JfXv3qoj

[The Trade Brigade @TradeBrigadeCo]

Claude's BS detector going off. 👃

[Brandon Carl @brandonjcarl]

Documenting the headwinds I now see for AI.

It won't seem like it, but I love AI and am long-term positive. But when "math doesn't math" I take note.

1. The core thesis for foundation model lab investment has been high upfront investment made worthwhile by significant long-term profits.

2. These are capital intensive businesses and the compute commitments are very high relative to revenue and require strong growth over long time periods. The "leverage" (commitments versus revenue) is extremely high.

3. The fundamentals are not as positive as they previously were:
• Input costs are higher (commodities, chips, power)
• Interest rates are higher
• Competition is more intense
• Scaling Laws are now problematic: exponential costs/power cannot continue

4. Forecasting compute spend is challenging and high risk due to (a) revenue uncertainty and (b) algorithm uncertainty

5. Revenue growth appears to be slowing. The technology is valuable, but ROI is proving to be more expensive and take longer than anticipated.

6. The future is likely "different models for different use cases" with the lower end of the market being highly competitive.

7. Core use cases such as agentic software engineering are likely to need approaches beyond next-token prediction. They are Σ₂ᴾ complexity problems requiring multi-objective optimization and likely a combination of Transformers and other methods.

8. Current forecasts in memory makers are built largely on quadratic attention. That will not persist: we are already seeing work from DeepSeek, Minimax and Nvidia that can cut RAM needs by 80% or more.

9. This means semiconductor valuations are substantially overinflated and will go through the traditional glut versus shortage cycle.

10. For foundation model providers: lower costs with competitive differentiation is good. However, lower costs with a lack of differentiation would mean lower revenues. This makes it harder to (a) service commitments and (b) pay back investors.

11. Leverage is substantially higher than in previous cycles, evidenced by leveraged ETFs, call option activity and margin loans. Korea is particularly susceptible.

12. 0DTE options create a profile that has stronger parallels to portfolio insurance and 1987 than any other point I can remember.

13. The combination of exponential increases in call activity coupled with the ties of semiconductors to structured products means there is a non-trivial systemic risk to the financial system.

14. Implied earnings growth rates are inconsistent with other periods in history.

15. Macroeconomically we cannot and should not fund exponential cost increases. History has shown us repeatedly that there are better ways (see Quick Sort and Simplex).

16. Significant supply is hitting the market via IPOs.

––

Taken together: costs and competition are increasing while revenue growth is likely slowing. Valuations are fragile and prone to technology disruptions that are already here. Systemic financial market risk is extremely high.

[Reya @reya_xyz]

The $REYA ICO is now live on @CoinList.
From the Reya Foundation.
Pre-sale closes Dec 2 at 17:00 GMT.

Already a top 10 DEX by 30d market share, here are 5 things that set Reya apart from every other perp DEX:

- Sub-ms execution that unlocks new HFT strategies
- Full Ethereum security - first Zk based-rollup DEX, giving no single sequencer risk
- Free trading for all dApp takers
- Spot markets launching soon
- Most Ethereum aligned DEX with 80:20 REYA to ETH buybacks

Reya - Fast. Free. Secure.
Full details below

[Peter Johnson @TheChicagoVC]

Thrilled to share the comprehensive report to-date on global stablecoin usage, with a specific focus on usage in emerging markets - by @CastleIslandVC, @BHDigitalAssets, and @Visa.

https://t.co/9Fe3jVLuJ0

[nic carter @nic_carter]

Gm! Excited to present our new whitepaper, written in collaboration with @BHDigitalAssets, @Visa and @artemis__xyz

https://t.co/9FcopG0zNw

[Gautam Sharma @Gautam_iit]

@KyleSamani Fair. But is there data that shows that loss of revenue from those opportunities due to lack of micro payments (1 in 10 subscribe) is more than made up by bundling or subscription paid by that 1 converted subscriber? Or what you are saying is better for profits and not revenue ?

[Bill Barhydt @billbar]

Live from Jackson Hole:

Fantastic panel…

@KyleSamani, @Gautam_iit, @joemccann @MikeBucella Adam Guren & Daniel Barile

delivering alpha in active liquid token investing…

#crypto #DigitalAssets @SALTConference

[SALT @SALTConference]

Wyoming Blockchain Symposium panel announcement:

Delivering Alpha in Active Liquid Token Investing with @KyleSamani, @joemccann, @MikeBucella, @Gautam_iit, Adam Guren and Daniel Barile

Jackson Hole, Aug. 19-22 -- Learn more: https://t.co/rSwhuHw7hM

@SALTConference | @krakenfx

[Gautam Sharma @Gautam_iit]

@British_Airways it’s 2 days and delayed luggage (all because of your incompetency and poor systems) hasn’t been delivered. Flight: BA119. Your CC team have no clue when luggage be delivered. I am a gold member and that is how you treat your power users? Pls get in touch asap?

[Investopia @investopia_ae]

.@Gautam_iit, CEO & CIO @BHDigitalAssets, underscores the importance of blockchain in accelerating finance.
#Investopia2024

[Investopia @investopia_ae]

Traditional and digital finance are converging, and alternative investment is growing. What changes have technologies like NFTs and DeFi brought to investors? How can traditional financial institutions remain competitive? Discover more at #Investopia2024.

[Polygon @0xPolygon]

The institutions have arrived on Polygon CDK. For the first time, a financial institution-focused L2 is being built, settling to Ethereum.

Introducing Libre, institutional web3 infrastructure for the distribution of alternative asset funds, launched by WebN and @LaserDigital_.

Built with Polygon CDK, the Libre chain will focus on issuance and distribution of tokenized assets, leveraging the security of Ethereum. The platform will unlock broader distribution capabilities for asset managers and wealth advisors and enable unparalleled access to alternative investment funds for a broader pool of investors.

The web3 infrastructure is set to go live in Q1 2024 with Brevan Howard and Hamilton Lane to be the first issuers to strategically partner with Libre. The team is also working on enabling services like collateralised lending and automated rebalancing of separately managed accounts.

More on Libre: https://t.co/IADmrmYg2V

[Colleen Sullivan @colleenklein]

1. I wrote an essay re: the intersection of web3 & games. It's intended for anyone who enjoys games & is curious how web3 may impact the gaming industry. The essay is written in a modular fashion so folks can skip around & read the sections that are of most interest.

[Gautam Sharma @Gautam_iit]

Interesting. RBI taking CBDC path seriously!

[Medici Network @NetworkMedici]

Great kickoff to Medici House today!

@MihailoBjelic (@0xPolygonLabs)
@sandeepnailwal (@0xPolygonLabs)
@moshaikh (@Aptos_Network )
@yaircleper (@lavanetxyz)
@Gautam_iit (@BHDigitalAssets)
James Newman (@BHDigitalAssets)
@adam_winnick (@NetworkMedici/@FinalityCap)

[Gautam Sharma @Gautam_iit]

@SteadyCompound Valuation!

[Peter Johnson @TheChicagoVC]

Entering 2023, many folks are down on crypto, but at Brevan Howard Digital, we’ve never been more excited. We’ve seen multiple crypto market cycles and know that it is when the hype dies down that builders build, non-speculative use cases accelerate and great investments are made

[Peter Johnson @TheChicagoVC]

Excited for @BHDigitalAssets to have led @MessariCrypto's $35mm Series B! They have become the trusted source for crypto data, research, and asset intelligence - looking forward to leveraging our experience and network to further accelerate their growth!

https://t.co/r4RTcQEpmk

[SALT @SALTConference]

Speaker Announcement for #𝗦𝗔𝗟𝗧𝗡𝗬🗽 2022

Building Crypto Into Modern Portfolios with @Gautam_iit, Co-Chief Executive Officer at @BHDigitalAssets

To register or learn more, visit: https://t.co/JE9zjOPuPb