To investors,
Many of you have been calling, texting, and emailing throughout the week. Your questions revolve around what has transpired, how we got here, and what this means for bitcoin and the broader industry moving forward. Rather than continuing to repeat the same comments in private, I thought it would be appropriate to share my views publicly.
I am disappointed and I am mad.
I am disappointed in certain teams and companies that didn’t disclose the actual risks to users, who misled me in private conversations, and who refused to share accurate information with their own employees.
I am mad because these sins have caused significant damage to individuals who don’t deserve this, while simultaneously erasing years of progress that were the hard work of great entrepreneurs and educators.
As many of you know, I am an optimistic guy. I believe the future is brighter than the past. I believe technology can solve serious societal problems and help unlock economic opportunity for billions of people who previously were at a disadvantage.
I am also someone who openly says what I believe. If I like something, I tell you. If I think something is bullshit, I tell you. My greatest strength and my greatest weakness is my willingness to say what is on my mind.
But there is no amount of optimism or authenticity that can hide the truth that we are all facing — numerous companies have taken more risk than they publicly acknowledged and now the average user is at risk.
That is not acceptable. In fact, this is complete bullshit. It should be called out.
The worst part though is that I allowed some of these companies to promote themselves on platforms that I own. That was my mistake and I own it. Even though I spent time with the various teams, questioned them about their products and processes, and was kept abreast of their current status, it appears that the risks were larger, and the current status worse, than I was told.
I wasn’t the only one that was fooled though. The best investors in the world, along with millions of retail users were all duped. It is unclear whether this was malice or negligence, but it is wrong either way.
To those that used certain products and are stuck in limbo, I want you to know this: I read the news like everyone else. I had the opportunity to take my assets off these platforms, but that is not how I roll. I go down with the ship. My assets aren’t coming off the platforms until the problems are fixed, which means that I stand to lose a lot — and this is exactly how it should be.
The second thing that I want everyone to know is that starting January 1, 2023, we are going to be making a number of changes to our various content platforms. You will no longer see me extend my name or reputation for a company that I don’t control. It doesn’t matter what a company or founder tells me — we have been burned more than once now and nothing is worth the risk.
As I stated in the beginning of this letter, the events of the past week have left me disappointed and mad. For years I have been a public proponent of bitcoin, along with the various companies and technologies across the industry. I truly believe in the future of bitcoin. I have material skin-in-the-game.
But enough is enough. Someone has to raise their hand and call out this centralized nonsense.
It is a weird feeling to have deep conviction in bitcoin and simultaneously question the direction and sustainability of various companies in the industry. Moving forward everything has to be earned. Companies will have to prove to users that they are willing to do the hard work to earn their business. Founders will have to work extra hard to convince talented people to come help them build their dream. And investors will have to spend more time explaining to their limited partners why certain assets like bitcoin are different than the current chaos.
And finally, my message to each of you — don’t trust, verify.
This is a lesson that I have been reminded of multiple times this year. Hopefully we can all begin building again once the dust settles. Until then, I wish nothing but the best for you. I’ll talk to everyone on Monday.
-Pomp
Nicolette Hartman is a Partner at Daversa Partners.
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All of my exposure to Cripto is in Blockfi which I choice in no small part because of Pomp's involvement. I thought some weeks ago about bailing but chose not to because of supportive statements by BlockFi's management. I finally reached my limit last night, notwithstanding managements assertion on twitter that withdrawal requests were still being honored some few hours earlier. 3 AM I tried to bolt and I missed the window. No distributions. This is bad and hurts your brand Pomp. You sat on the board man. I trusted you. Nice words, sincerely meant I'm sure but this can't stand. The "values" of transparency and "customer value add" on the web site ring mighty hollow. You need to help these guys make it right by customers and if board and management get paid while other customers and I swing in the wind, I will forever remember it. Gut check time for you and BlockFi, gut check time.
“Don’t trust but verify.” How are we mortals supposed to verify If you Pomp, somebody with all the contacts gets duped like this?
P.S. Loosing your credibility must hurt the most. At least I hope you made more money out of them through sponsorship than they finally take from you.