Joey Krug on Prediction Markets, Crypto Treasuries & the Next Era of On-Chain Finance (Partner at Founders Fund)

Speaker A: You dropped out of school and then built what was really the first crypto prediction market called Augur. How did that idea come to you? Speaker B: If you have markets where you can basically bet prospectively on anything, that's the ultimate vision of capitalism. And I was really drawn to this vision as well. If you can have markets on any future state of the world, you can then use that information for lots of other things. Speaker A: We're now seeing ETH treasury companies, Solana treasury companies. How do you think it changes the structure of this market?

Speaker B: I think it probably works less well as you go down the list of assets. In the same reason that a small microcap stock can't really issue that much debt. People want to buy Apple bonds or Goldman Sachs bonds. They don't really want to buy the small to mid-cap. Speaker A: We've talked about some of these regulatory changes that have been made under the Trump administration and how much hostility there was under the Biden administration. Speaker B: I think the most absurd thing I remember under the Biden admin for crypto was that the SEC actually tried to take the position at one point that stablecoins were a security, even though, like, buy USDC, you can't really make money.

Speaker C: Prediction markets are having a moment. Over the past 2 years, these exchanges have gone from curiosities to possibly the future of finance. Increasingly, platforms like Polymarket attract billions in monthly volume from traders keen to speculate on just about anything, from political races to sports events to the number of tweets Elon Musk will post in a given timeframe. Today's guest, Joey Krug, saw the opportunity in prediction markets long before the rest of the world, building the first decentralized player in 2014, and then backing Polymarket as a partner at Founders Fund nearly a decade later.