Motion: The industry is growing out of the Fat Protocol Thesis (Jeff Dorman vs. Joel Monegro)

The Blockchain Debate Podcast

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Guests:
Jeff Dorman (twitter.com/jdorman81)
Joel Monegro (twitter.com/jmonegro)

Host:
Richard Yan (twitter.com/gentso09)
Today’s motion is “The industry is growing out of the Fat Protocol Thesis.”
The Fat Protocol Thesis was coined by a blog post on Union Square Ventures’ website. The Fat Protocol Thesis postulates that because crypto protocols are investable assets, they will likely capture more value than the applications built on top. This is contrary to the Internet stack, where applications captured much more value than the protocols they operated upon.
This thesis seems to have worked out nicely so far, with the aggregate valuation of various layer-1 protocols far exceeding that of the applications. But will this continue to be the case? What are the nuances related to the Fat Protocol Thesis that would inform sharper thinking about relative value of protocols vs applications?
Our two guests today are both investors at well-known digital asset funds. One of them is the author of the original Fat Protocol Thesis. The other has a few questions about it, to say the least.
If you’re into crypto and like to hear two sides of the story, be sure to also check out our previous episodes. We’ve featured some of the best-known thinkers in the crypto space.
If you would like to debate or want to nominate someone, please DM me at @blockdebate on Twitter.
Please note that nothing in our podcast should be construed as financial advice.
Source of select items discussed in the debate (and supplemental material):

• Joel’s Fat Protocol Thesis: https://www.usv.com/writing/2016/08/fat-protocols/
• Joel’s Follow-up piece Thin Applications: https://www.placeholder.vc/blog/2020/1/30/thin-applications
• Jeff’s Blogpost “Revisiting the Fat Protocol Thesis”: https://www.ar.ca/blog/revisiting-the-fat-protocol-thesis
• Laura Shin interviews Joel Monegro on the Fat Protocol Thesis: https://unchainedpodcast.com/placeholders-joel-monegro-on-the-fat-protocols-thesis-today-ep-65/
• Arca Fund's crypto taxonomy: https://www.ar.ca/digitalassettypes

Guest bios:
Jeff Dorman is the CIO of Arca, a digital asset investment platform with more than $500 million in assets under management. Prior to Arca, he worked in portfolio management and trading at various places including Citadel Securities, Merrill Lynch and Lehman Brothers.
Joel Monegro is a founding partner at Placeholder, a crypto venture fund. Prior to Placeholder, Joel was at Union Square Ventures, where he developed the firm’s early blockchain thesis and portfolio. He is also the author of the seminal blog post Fat Protocol Thesis, which is still up on Union Square Ventures’ website today.