In episode 1 of Hash Power, we explored blockchains as a technology—how they work, why tokens (also known as cryptocurrencies) are an integral part of any blockchain, and how these new networks might change the world. In episode two, we spend time with the leading investors in the field. Like any frenzied asset class, there are countless cryptocurrency hedge funds popping up everywhere. But founders from three of the original firms—Polychain, Metastable, and Blocktower Capital—are our primary guides this week. As I speak, the total market cap of cryptocurrencies is $136B. There are hundreds of tokens currently available, but bitcoin and Ethereum represent 75% of the total market cap. $136B sounds like a big number, but its tiny relative to any other asset class—and I use that term with hesitation. To put it in perspective, that’s exactly the same size as the market cap of IBM. But IBM had more than $10B of earnings in 2016. Tokens have none. As you will hear, valuing tokens is a very hard exercise. In such a nascent world, we are seeing investing strategies take hold. Olaf Carlson-Wee, Josh Seims, and Ari Paul walk us through different takes on cryptocurrency investing, be it early stage, long term buy and hold, or more hedge fund style strategies. Hash Power is presented by Fidelity Investments For comprehensive show notes on this episode go to http://investorfieldguide.com/hashpower For more episodes go to InvestorFieldGuide.com/podcast. To get involved with Project Frontier, head to InvestorFieldGuide.com/frontier. Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub. Follow Patrick on Twitter at @patrick_oshag   Links Referenced Fat Protocols (Joel Monegro)   Show Notes 0:05 – Recap of part 1 and introduction to part 2 of Hash Power 2:58 – Ari Paul, CIO of Blocktower explains how he got involved in cryptocurrencies 5:23 – Why do we need bitcoin 7:23 – Polychain Capital founder Olaf Carlson-Wee on why the value of tokens accrue 9:23 – How main stream money is getting into this space 12:26- Useful comparisons when talking about ICOs when compared to IPOs 15:01 - Naval Ravikant, CEO of Angellist, is asked to explain the protocols of cryptocurrencies to platform businesses like Uber or Airbnb 17:43 – Naval’s interest in investing in cryptocurrencies 23:07 - Olaf Carlson Wee on the lifecycle of a token 24:02 – SAFT note, Simple Agreement for Future Tokens 25:31 – What is the earliest stage that edge is most present for investors in cryptocurrency protocols 28:12 – How do you mitigate the volatility that is present in blockchain 31:18 - Jeremiah Lowin, a risk and statistics expert, who runs risk management for a large private family office, talks about why he no longer owns cryptocurrencies  34:19 - Jordan Cooper, a venture capital investor, is optimistic about blockchains in general, but thinks there may be some overvaluations in current currencies 37:02 – How Jordan would value a single cryptocurrency 42:10 – Fat Protocols (Joel Monegro) 43:52 - Josh Seims, of Metastable, the value investor in blockchain? 51:15 - Ari Paul on the equivalent of listed stocks in the crypto currency world 52:33 – Understanding the concept of a coin in blockchain and how people are getting access to them 55:07 – The fairground analogy to understand cryptocurrencies 57:57 – What lessons from traditional markets can you apply to investing in cryptocurrencies 1:06:51 – Ari is asked to discuss some of the alternative cryptocurrencies outside of Bitcoin and Ethereum. He starts with Ripple 1:10:27 – What would help firms or traders create edge in investing in cryptocurrencies   Learn More For more episodes go to InvestorFieldGuide.com/podcast.  Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub Follow Patrick on twitter at @patrick_oshag