Please don’t YOLO your 401(k) into shitcoins
Anita Ramaswamy and Lucas Matney, April 28, 2022, 43 minutes
Hello and welcome back to the Chain Reaction podcast, where we unpack and explain the latest crypto news, drama, and trends, breaking it down block by block for the crypto curious.
It’s been an action-packed week, to say the least. We kicked off today’s episode with a spirited back-and-forth about Fidelity’s plans to bring bitcoin to 401(k)s and regulators’ fears about whether the move will open the floodgates for people to YOLO their retirement savings into a volatile asset class.
The Case for Bitcoin in 401(k)s
Anita shared her hot take on why the news could actually be good for non-billionaires, which you can read more about on TechCrunch+. In essence, she argued that having some crypto in your 401(k) is neither irrational nor exuberant. By allowing people to invest a small portion of their retirement savings in bitcoin, Fidelity and other exchanges may be providing a valuable service to individuals who might not otherwise have access to this type of investment.
This move could also help to increase adoption and awareness about cryptocurrencies among a broader audience. As Anita pointed out, "It’s not just about the rich getting richer; it’s about giving people options for their retirement savings." By making it easier for people to invest in bitcoin, Fidelity may be helping to level the playing field and provide more opportunities for individuals who might not have otherwise considered investing in cryptocurrencies.
Coinbase CEO Takes Aim at Apple
In other news, Coinbase CEO Brian Armstrong threw some pointed shade at Apple for its crypto policies on the App Store earlier this week. His company’s stock reached an all-time low a few days later, so… interesting timing. Clearly, there are still many challenges facing cryptocurrency exchanges and investors in their efforts to gain mainstream acceptance.
The Elephant in the Room: Elon Musk’s Twitter Bid
Obviously, we had to address the elephant in the room — Elon Musk’s $44 billion bid to buy Twitter. Lucas wrote about Twitter’s place as a watering hole for the crypto community in a recent Chain Reaction newsletter, and on the pod, we discussed what a Musk-owned platform would mean for online interaction in web3.
We also dove into what this news could mean for Bluesky, a group borne out of Twitter that’s working on building a decentralized social network protocol. With Musk at the helm, it’s unclear whether he’ll continue to support and promote decentralized technologies or if his focus will shift towards more centralized, traditional approaches.
Our Guest: Sequoia’s Shaun Maguire
Joining us today is Shaun Maguire, an investor at Sequoia and a well-known figure in the crypto community. We chatted with him about Sequoia’s recent crypto moves, the possibility of a multichain future, and whether we’ll ever reach true decentralization at a mass scale or will end up stuck in ‘Web 2.5’ forever.
Multichain Futures and Decentralization
Shaun shared his insights on the potential for multiple blockchains to coexist and thrive, rather than one blockchain dominating the market. He also discussed the challenges facing decentralized technologies, including scalability issues and regulatory hurdles.
When asked about the possibility of reaching true decentralization at a mass scale, Shaun was cautious in his assessment. While he acknowledged the progress made so far, he emphasized that there’s still much work to be done to overcome the complexities and obstacles inherent in decentralized systems.
The Future of Web3
As we continue to explore the potential of web3 technologies, it’s essential to remember that decentralization is not a fixed state; rather, it’s a continuous process. By working together and pushing the boundaries of what’s possible, we can create a more inclusive, secure, and efficient digital ecosystem.
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Anita Ramaswamy’s Bio
Anita Ramaswamy is a reporter at TechCrunch focused on crypto and fintech. She also co-hosts the weekly crypto podcast, Chain Reaction, and authors its companion newsletter of the same name.
Before joining TechCrunch, Anita covered financial institutions for Business Insider. Prior to becoming a journalist, she worked as an investment banking analyst at Wells Fargo Securities.
You can reach her via email at anita@techcrunch.com and follow her on Twitter at @anitaramaswamy.
Disclosure: Anita owns small amounts of BTC, ETH, UNI, and YFI for the purpose of learning more about web3 products and services. These investments are made with her own funds and do not influence her reporting or opinions.
Lucas Matney’s Bio
Lucas Matney is a co-host of the Chain Reaction podcast and has been covering cryptocurrency and blockchain since 2017. He has written for publications like Coindesk, Forbes, and Bloomberg, and has interviewed some of the most prominent figures in the crypto space.
Before joining TechCrunch, Lucas worked as an editor at The Block, where he covered news and trends in the crypto industry.
You can follow him on Twitter at @lmatney.
