Friction and Fortune: Why You (Probably) Wouldn't Have Bought Early Bitcoin

A lot of people say "if only I got Bitcoin at..." an earlier year, but are often unaware of the friction involved in doing so back then. (Technical, social, political.) Why "getting in early" is not easy and what to pay attention to in today's markets to prep yourself for the next cycle.

Part 1: The Myth of the Missed Boat

• Breaking down the "if only" fantasy and introducing the concept of crypto friction—the technical, social, and political barriers that made early adoption a minefield, not a sure bet.

Part 2: The Unbuyable Past: Friction in the Wild West Era

• No Exchanges, No Rules: Acquiring BTC meant mining or bartering (The Pizza Story).
• The Ethereum ICO: A technical hurdle requiring direct BTC-to-smart-contract deposits.
• Mt. Gox: The Cautionary Tale: The first major exchange was a hub of scams, phishing, and catastrophic collapse.
• The "Joke" Coin Narrative: How Dogecoin was dismissed by the "serious" crypto community before its epic run.

Part 3: The Unseen Present: Modern Friction & Undervalued Gems

• How today's friction isn't technical, but social and narrative-driven.
• Case Study 1: Tezos ($XTZ) – Dismissed as a "joke" by speculators due to its price history, despite its proven, high-quality tech and governance.
• Case Study 2: Gridcoin ($GRC) – Ignored during the last bull run due to limited exchange access (only GRC/BTC pairs) and lack of hype, despite its unique, working product.
• The Thesis: These projects represent the current "if only" opportunity—high-quality assets misunderstood because of their lack of narrative momentum.

Part 4: How to Think About Friction Now

• Using historical friction as a lens to identify today's undervalued projects.
• How to separate a "bad project" from a "good project with bad marketing."
• Where to look for the next wave of fundamentally strong, overlooked crypto assets.

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Transcript

SPEAKER_00: 0:01

Hello everyone, this is Ryan from Tea Cafe. This is season two, episode three. So friction and fortune. Why you probably wouldn't have bought early at Bitcoin. So something I see pretty often, especially now that the markets are struggling a bit. So I've been in crypto since like 2013 or so. My uh big success, I guess if you call it that, was getting into the Ethereum ICO early. And back then you could get in for pretty much like a 25 cents apiece. You know, so if you compare that price to Ethereum now, um, right, you can do the math uh and did pretty well with it. But part of the issue was like it wasn't so easy that it was like, yeah, I just went in and bought some and I got lucky, you know. There was actually a lot of hurdles in getting in at that time, especially. Some of it was technical, some of it was social, and some of it was political. And that's kind of why if you were in the if you even knew about crypto back then, if it was even on your radar at all, right? That that's the first challenge, even being aware of its existence. Um, there's a lot of minefields involved that were discouraging you from doing it, and kind of overriding that it wasn't easy, and that's true back then, but it's also true now. So I'm making this in hopes that maybe uh people might take a different look at how to think about investment because I got very lucky, you know. I won't lie, I got lucky with this whole thing. Like crypto is paying my bills right now. And uh we'll see if that can continue. It kind of depends on whether this next next cycle uh turns out the way I want. But you know, uh for all intents and purposes, I'm I'm one of the more lucky ones in the space. But it took a while to get here. So I want to talk about the details of like why it was a good idea, or or you know, why why I thought it was a good idea back then, back when nobody else thought it was, and connect it to the decisions I'm making now, which I'm hoping hoping that will repeat in the future. Because the reality is that most people are not very good at investment, um, because it's actually very difficult to turn a profit based on investment because of the whole herd mentality, right? To be a successful investor, you kind of have to be a contrarian, and that can be very difficult due to like various reasons. But if you're willing to kind of break from the pack and take a chance, uh it might work out work out for you, you know. So I'm doing this mostly um as an educational thing. I'm not saying uh I don't like to make predictions like you know, this is not financial advice. You heard that phrase before, right? I really believe in that. You know, like I I when people ask me about like you know, investment tips and all that kind of I usually don't recommend anything. I'm just like I just all I do is like what worked for me in the past. So uh as a recap, the thing that uh that uh worked for me, this is my success record, I guess. I already mentioned uh Ethereum ICO 2014. Uh I bought a Crypto Punk for$100 in 2016 or so. And then uh my other big uh success was getting into Dogecoin early before it did that insane like hundred thousand percent jump, right? Like a few years ago. I got really, really lucky with that one, but uh I'm gonna just kind of say why getting in early was not easy. So okay, Ethereum ICO, right? So how did I get in? One uh back then when they first announced the ICO, and this was like Vitalic and and company, right? Um the Ethereum Foundation, they had this idea of raising money through an initial coin offering. And at the time that was very, very new. People didn't even know what the fuck that was, you know, like ICO, what is that? You know, it and all this stuff just sounds like some nerdy, crazy, like what internet money, like you know, even right now, crypto is really not that well understood, even back then it was even worse. So the the fact that you were even paying attention to it was kind of like you had to be in certain circles of very, very nerdy people. Uh and on top of that, they required you to pay them in Bitcoin because all of this was done on chain, it was done online, and the only way you could get access to the the ICO was to pay them directly in Bitcoin. Now back then there was no exchanges, so you now you can kind of go to Coinbase, uh throw in a few dollars and get some Bitcoins really easy now. Back then there was no such thing, so the only way you could do it was to either mine it yourself, like set up a mining rig, and slowly accumulate Bitcoin over time, which is what I did. I was mining, I bought a small USB-powered miner. It was very, very low power. I just wanted, you know, wanted to check it out. And I was mining it for a few months just for fun. So, yeah, so that's how I got my Bitcoin to get into the ICO, which eventually uh got me my profit. How many people were gonna do that, right? Who has the patience to buy this weird box that you know like made money out of computing power, and it's like what, right? So so just keep that in mind. You know, back then that was kind of an insane thing to do. No one knew, including my family, what I was doing. They never really asked much questions. I was just doing as a hobby, even myself. I didn't make a big deal out of it. I just like, oh, there's this cool thing, you can mine coins, make money off your computing power. Wow. You know, uh it's kind of interesting. So, really what got me in was the curiosity of just like, oh, uh, here's this new thing and just want to try it out. The other way you could have gotten Bitcoin was to buy it, to barter for it, basically, right? A lot of people make fun of the oh, that guy bought a pizza for Bitcoin, he would have been rich now, you know, whether that would have been worth eight million, or I don't know, right? But uh honestly, a lot of people did that back then because it was the only way you could get Bitcoin. Again, there was no exchanges, so you couldn't have come converted your cash into it. You had to give something tangible in return in order to give it. You gotta find some guy on the internet to send it to you through an online forum. You know, that was the only way. So uh yeah, so it's kind of funny that people made fun of that later on, not really understanding that that was the only way you could have done it back then. So, okay, so now you kind of understand why most people did not get in early, right? The same thing you could have said about um Crypto Punks and Dogecoin, because when I bought the Crypto Punks, uh I had to pay Ethereum directly for it. Um there was a few exchanges that that you know, by the time uh 2016 rolled around, there was Mt. Gox, uh which rose and fell. We can look up the history of it, it uh it was a disaster, you know. And a lot of people lost their their money in it, you know, it was very risky. But then all of a sudden they're like, oh, by the way, we're closing up shop. Sorry, all your coins are gone, right? Whoopsie. Like right. Uh a lot of people were very bad, but there were it was such a small community that uh there were protests. You can look at the picture, people were protesting, they stood in front of Mt. Gox after the closers, like, where's my coins? Right? But there was just like not enough people to make a stir out of it, and the general public really didn't care because they didn't even know what was going on, you know. So all those things, right? Those are political, those are social, those uh economic, whatever you want to call it. There's all these things telling you, uh, this is too risky, right? Would you put in, would you have gone in, like would you have put in your life savings into Bitcoin, knowing all that at the time? Probably not. It was very risky. But you know, as they say, no risk nor reward. So the people that kind of either were lucky or like pushed through it were the ones that made money. And uh, you know, that's kind of how how how it went down. Like, you know, it is what it is. Uh it's not neither good or bad. That's just what you had to do if you wanted to make money in the space. So there's that. There's risk, there's social, you know, uh Vitalik. Uh they had if you I think they scrubbed it by now, but like there's video footage of Vitalik on a video call eating his own boogers. And at the time, uh I thought it was hilarious. It was just like, oh my god, like this is a guy, you know, like people didn't take crypto so seriously like back then, and that's what made it fun, you know. Um in a lot of ways, that fun is what kept the thing alive. You know, people some people made some money, but back then it was more about the experimentation, it was more about you know, trying new things out. Hey, we're gonna do this crypto thing. There's people were more idealistic back then, you know? And uh the same thing you could say about the Doge community, like Doge community, everyone thought it was a joke, right? But they owned it, they they owned the joke thing and they used Dogecoin to like support Jamaican bobsled team just for fun. There was no reason for it. They just thought it'd be kind of fun. And the the Jamaican bobsled theme eventually went to the Olympics, and it was just like this fun thing that you know, they did, and so that that that really was the thing. That that was really the key. It wasn't about the money back then, it was really about the community. And people just liked each other, they did fun projects, and uh that's what kept Dogecoin alive throughout the years, you know, especially from uh 2016 to 2020, right before I did that huge jump. So yeah. So but that's that's kind of it, right? Like so there's all these hurdles involved in like what um like the mainstream, like the main like you know, most people don't really care about this stuff, you know they they're all followers, they come later. But the the group of people that kind of keep the um project alive when nobody's paying attention, those are the people that really made this thing work. But the jumps in price and like the returns, they don't come until much later. Like i it's a it's a game of patience, you know. Okay, so um I'm gonna go to what's happening now because um normally I don't do shell posts, but in the last few months I've like consolidated my portfolio. I got rid of all of my Bitcoin, I got rid of all of my Ethereum. I think those projects have like grown too big for its own good relative to the kind of value that their projects are providing, which is honestly not much. But a lot of the sentiment of like community and and creativity, especially, uh I believe has gone to gone to Tezos. So I won't go too much into it, but a lot of the artists that in the earlier days many of the artists and creatives were in Dogecoin or Ethereum from the years of like pretty much since the beginning, 2014 to 2020, they had a good six, six or seven years of just like a lot of creativity, a lot of the artists were there, developers, builders, you know. And it was a great time. But after the price started going up, uh they got to taken over by the banks and the middlemen, and it's the culture hasn't been the same. So a lot of that uh experimentation and innovation has gone over to Tesla's, and again, uh it's a it's a very, very small project relative to the bigger ones. I think they're still like either 70s or 80s in the rankings, right? Uh, but it has it's a very high quality project relative to its size, and I do think it's gonna do well in the long run. So that's where a lot of my money is right now, that's where I'm putting most of my effort. I've built uh like Teya Cafe is actually built on Tesla's, so this is part of the you know, this is part of the shill, if so to speak. There's a lot of work to be done, but it has a lot of potential, mostly because it has one of the most uh stable governance systems in the industry right now. And uh, you know, as the markets start to go down, uh it's gonna get more and more contentious, and and the projects that don't have good governance are probably gonna fall apart due to infighting. So I see lately the prices have started to reflect that. Like a lot of the the coins are dipping very hard, but uh Tezos is kinda staying its head above the water, you know. It's not doing great, but it's doing less bad. And sometimes that's the build that's the best you can hope for, yeah. Okay, the other the other project I want to talk about is Gridcoin because I doubled down on that recently. And uh it's an interesting case because uh it's technically a form of proof of work. They call it proof of research, but it's the basically the same thing as proof of work because you're basically converting crunching, they call it crunching to medicating your CPU or GPU cycles in order to ver validate transactions, just like Bitcoin. But grid coin is very interesting because instead of doing useless math problems, it's actually the crunching goes into scientific research. So if you know like at home or world community grid, a lot of those uh processing power gets applied to scientific research. So it's like proof of work but actually useful. And I do think it basically uh makes most proof-of-work models obsolete because it's a lot of energy and a lot of computing power and wear and tear to be going to just validating transactions, right? Here the the computing poes to something actually beneficial. So uh when Bitcoin eventually falls out of favor, which I think it is going to happen in the next couple of years, there's gonna be all this competing power sitting around like looking for something to do. And I do think gridcoin is there to capitalize on that when it happens. A lot of this is is gonna take a while because people a lot of people got rich off of Bitcoin getting in early, right? And they're gonna be very resistant to letting that go. But you know, you can't you can't uh fight it forever. Bitcoin is just too slow, it's expensive, it uses way too much energy, and there's all this other competition. The store of value thing is like a nothing, because cause anything can be a store of value, right? It's not a competitive advantage. Eventually it's going to go away. As soon as like the people holding their bag, so to speak, right, like give it up. And time is not on their side, to say the least. So anyway, I don't wanna, you know, make it seem um ominous, but we do know that that's company coming eventually, we just don't know when exactly. And Gridcoin is a is in a very good position to sort of pick up on the work that uh other projects have left be fine. So the other interesting thing is if you look at the price of Gridcoin, GRC, if you want to look it up, uh nothing happened to it during the last hype cycle. If you look at even Tesla's, twenty twenty one was the year that most crypto projects have peaked. But if you look at Gridcoin, nothing happened because they're not even on any exchanges. They didn't even bother because they're supported by Boink, like uh which is based out of UC Berkeley. It's kind of a research project, a science project, an educational project. They're funded through other means, and they didn't seem they were not in any rush to like jump in on the NFT bandwagon or you know. They just quietly all these years developed this technology, and it's gotten better, you know, even over the last couple years. But no one knows about it. And the only way you can buy it is through Bitcoin. Interestingly enough, they didn't move away from the motto of uh being able to buy Bitcoin. So there's a there's one exchange, I think it's called Fry Exchange. I tried uh there's two different exchanges on their website, Fry Exchange and Safe Trade, or something like that. Uh Safe Trade doesn't work at all. I tried it. Uh the volume is you can the liquidity is too low, so it doesn't even do anything anymore. And Fry Exchange, you can only buy what people are selling directly. It's like a throwback back to like 2013 pre-exchange, you know. Luckily, now you can at least get Bitcoin. But what you have to do is buy Bitcoin uh through whatever means, send the Bitcoin over to that other exchange, and then buy the coins directly from a chart. You have to use one of those uh pro, you know, um trading tools. Like you can't it's not aggregated like most exchanges are. You have to buy the shares manually like you would be at at Wall Street. So you see all the friction here, right? Like, who the hell is gonna go through all this trouble of just to get some coins that nobody has ever heard of and nobody's talking about, right? But that's kind of the mind mentality that you gotta have to have if you really want to make real money in this space, because yeah. So like even with this podcast or the posts I do on social media, I'm not really concerned about getting engagement. Because in a way, if everyone knew what I was doing, that would be less profits for me, you know. Assuming I'm right. If I'm wrong, then no one gives a shit, then you know that that's it. You know. But uh but if I'm right, oh uh the less people that know about what I'm doing is actually the better. But you know, there's there's a balance to be struck here, right? I can't do it in a vacuum, right? Some some people have to know, but not everyone, right? And so the reason I I make this type of content is really just for that. And if if a few people listen to it, great. Otherwise, it it really doesn't matter to me. So uh that's why I don't really chase, you know, I don't concern myself with like followers or likes, or you know, it's nice to have once in a while, but that's really not the main reason. So, okay, so those are my two examples of of things I think that might do well, especially now that the market is dipping. There's gonna be a lot of places that are closing up shop. Um, they see the writing on the wall, you know, like Bitcoin's not doing that well come relative to silver and gold, it's not acting as the hedge. And a lot of that has to do with like crypto projects kind of losing sight of why they're in the industry to begin with. Um you can you can check my previous episode for more details on that, but the market is correcting itself. And if you still believe in crypto and you still want to stick around, uh it might be a good time to take a close look at your portfolio because what's going to be successful in the future is not going to be the same kinds of things that was successful in the past. I really do think Bitcoin and Ethereum has peaked. That's they served an important purpose in the industry up until now. And if you were in early like I was, you've done well, but my reason for exiting is because can it continue doing that, right? Has it because well what happens with a lot of projects and even startups is that they have a like a one-hit wonder, right? But they fail to like evolve or grow fast enough to keep up with the needs of the next generation of crypto products. That's kind of part of the reason why it crashed in 22 to begin with. So, you know, if it if they're not doing the work that needs to be done, you kind of have to like go to the next generation to see what's being done next, and that's how you turn a profit. So, whether uh I'm right or not is yet to be seen. TVD, but um that is basically what I believe in and what my next bets are. So there may be I don't know everything. I don't know. There's so many coins, so many projects out there. I there might be a few that you know that are doing good work. Um if so, let me know. But otherwise, uh yeah, don't don't think of friction as a bad thing. I guess that's the main point I wanted to make. If it's difficult, if people are making fun of it, if people are not taking it seriously, even though deep down you know this is a high quality project, you might be in the right place. It just feels not great, you know? It feels weird because it's human nature to want validation from the masses, right? But that is not what that's not what makes you successful, you know. It's it's more than just money. This is true for a lot of things, right? If you're doing what everyone else is doing, you're probably not gonna make it because most people are losing a ton of money right now and going nowhere. Alright, so that's about it. Thanks for hearing me out, and see you in the next one.