Weekend Reading #251

This is the two-hundred-and-fifty-first weekly edition of our newsletter, Weekend Reading, sent out on Saturday 13th January 2024

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What we are thinking 

This week was all about crypto and Bitcoin in particular as a historical moment came to pass with the authorisation of the first Bitcoin ETFs by a very reluctant SEC in the US. To those not from the crypto world, one needs to understand the significance of this moment. Forget the circus around the SEC’s farce of an announcement. This is big. When we first got into crypto all those many years ago, the prevailing hope from everyone in the nascent ecosystem was that “The institutions are coming”. This became one of the first memes, long before memes even became popular. And many years later, the institutions are now here. In a way this is Bitcoin’s IPO. It’s the moment that the custody changes hands from degens and nutcases to Wall Street and BitcoinTM. Bitcoin belongs to Tradfi now. It’s story will be crafted by Blackrock et al as they look to make zillions from its flow.  

The real action this week however, ironically catalysed by the approval of the Bitcoin ETFs, was the awakening of the sleeping giant that is Ethereum and its token, Ether. After underperforming almost embarrassingly for 2023 compared to Bitcoin and pretty much every other layer 1 blockchain, from the moment the ETF was approved, ETH woke from slumber in style. The hot ball of money that is native crypto, decided to shift to ETH and its related ecosystem tokens. Why? Apparently because an ETH ETF is coming up next. Maybe. But as ever in crypto, when narrative and attention shifts, it tends to do so rapidly.  

Elsewhere, a rather strange start to the year continued this week with the market’s divergence rather striking once again. The fortunes of the US Dollar dictated much of what we saw in the commodity and EM space as the DXY oscillated around critical price levels. Large cap tech continued to trade well as Nvidia reached a new all time high just as its fellow, smaller AI names struggled. Again – divergence. We like divergence.  

What we are listening to 

After deciding to listen to less podcasts, I realised I still needed to run this week and I cannot run in silence so I caught up on 2 completely different episodes of The Diary of a CEO podcast with Steven Bartlett. He really does get good guests. First up was probably my favourite footballer in his day. Thierry Henry was poetry in motion at his peak and I switched on the episode expecting to listen to some great stories about his time at Arsenal, Barcelona and his world cup win with France. But that was not was ensued. Henry spent the entire time talking about how much his dad messed him up psychologically. The story of how his dad reacted when at age 15, he scored 6 goals for his team in a 6-0 win will stay with me for some time. Similar to other sports star dads, Agassi’s, the Williams sisters’ and many more, Henry’s dad took no prisoners in his drive to create a superstar. On the one hand as Henry says, it worked as he scaled heights his dad could barely have imagined professionally. On the other it made him unhappy everywhere other than the football field. I was surprised how openly he spoke about these issues and his ongoing struggle to do the thing he thinks more important than anything else – to be a better dad.  

Everyone knows Yuval Noah Hariri from his book, Sapiens. But to be honest the contrarian in me always was suspicious given the nature of some of his talks and “advice” he gives to the world. But I decided to give his chat with Bartlett a whirl anyway. And I was pleased I did. There was lots on AI and the future of humanity in its cyborg form. There was his unflinching view that more war is on the way too. But the main message I took from it was his advice on how important it is to take a step away from the information barrage and simply breathe, process and think about things. As a fund manager in a 24/7 era, I can sometimes fall victim to this and even just thinking about doing this made me feel a bit better. As he says, our brains are not built to be permanently switched on. The regular dopamine and excitement is actually bad for us. His concept of an information holiday definitely appeals to me! And finally his commentary about how important it is to study history obviously resonated as he preached to the already converted but his framing was interesting. He says the reason it is important is because history is the study of change. The Vikings and the Mongols etc don’t exist anymore but they changed the world. I wish the curriculum at school in the UK did more international history and not so much focused on the UK. The kids would be better for it. DC 

Just as I was poised to enjoy endless hours of Tolkien audiobooks on Spotify, I was abruptly notified halfway through the week that I had exceeded the free quota of audiobook playtime for the month on our Spotify plan. 15 hours was the limit, and while at first glance that sounds like a lot of listening time and I was initially sure that it must’ve been some sort of bug in the timer (or even worse, accidentally leaving Spotify on play and wasting minutes of play time that went unheard), a quick re-look at the total play time of the Silmarillion at 1x showed that Spotify was right: 19h. I’m not sure about paying extra for a top up of audiobook time, so for this week, my contribution here is rather “What I’m NOT listening to”. The whole collection of Tolkien books with Andy Serkis’ strangely relaxing voice will have to wait. EL 

What we are doing 

This week I was invited to dinner and drinks at the newly Broadwick Hotel in Soho, a project put together by entrepreneur Noel Hayden. Now when one hears a story of a tech billionaire building a hotel in prime central London, one might tend to be dismissive of it as just another case of too much money going around – and in this case, one would be extremely wrong. This article about the Broadwick in the FT is an excellent write up, complete with photos that do the internal décor better justice than my iphone camera ever would, telling the story behind every little detail baked into the design and set up of the hotel. It is clear that behind the extravagance, this is truly a passion project meant to continue the dream of Noel’s parents where their previous venture was stopped short in its tracks. Snippets of his childhood growing up in his parents’ hotel in Bournemouth can be found in ways big and small across the design of the Broadwick: from his mother’s name Jackie gracing the bar and restaurant, to little details like foil curtains resembling those from a magic show his parents performed (and in which he participated) for guests now finding a home in the Flute bar. The attention to detail aiming to create a top-class experience for customers is borderline obsessive – in a good way: from customisable music volume and lighting by seating area to curated playlists of 10,000 hours (each) specially designed for different areas of the hotel (including special tracks for the bathrooms), to a custom scent of air freshener that is pleasant, distinct yet not overpowering or invasive to the flavours of food and drink. At the end of the day, it was all the “small things” that came together to make the difference between just another night out at another soho joint and a deeply memorable experience worth writing about. EL 

What we are watching and reading 

I was really looking forward to the new Ricky Gervais special on Netflix from his latest Armageddon tour, which was released on Christmas Day. For the first time I found him a bit dull to be honest. There were moments where I approached the belly deep laughter I’m used to experiencing when watching Gervais, but they were few and far between. The rest was just an orgy of purposeless vulgarity. There are so few comedians who can genuinely create that deep laughter and though for me he is one of them, this show was a great disappointment. I’m always up for any good new comedians so please send me some if you have any good stuff. 

We have waited patiently for Netflix’s adaptation of Liu Cixin’s Three Body Problem (after which our business is named). The second trailer was released this week and it looks very enticing indeed. Netflix put the Game of Thrones creators, David Benioff and DB Weiss in charge and it seems there are some familiar faces from the GoT cast too. Can this series end the perennial run of TV disappointment? We hope so but in the meantime this trailer very much does whet one’s appetite.  

This feature article on Benioff and Weiss goes into a lot of detail about the show and their history with Game of Thrones and is a really good read. It also appears that the show will be different to the books as it tells a more “international” story. Apparently all with the blessing of Liu Cixin. One particular quote which is relevant to us and fund managers jumped out at me. “It’s great we won a bunch of awards, but that was a while ago,” Benioff says. “You have to keep proving yourself.” Couldn’t be more true.  

I have to write once again about the frivolous charge of genocide brought against Israel by South Africa at the ICC. As both sides’ arguments were heard late this week, on late Friday none other than Germany sought to intervene with South Africa’s “political instrumentalization of the charge” at the ICC. Apparently (and I’m no legal expert) Germany can apply to intervene as a 3rd party to issue its own arguments to the court against South Africa’s case. It’s rare but it shows just how angry the Germans are at this abuse of the court’s time. As I’m sure we all agree, the death of innocent civilians as part of any conflict is tragic. Genocide is different. It is something evil. Israel and Germany know that better than any other nations on earth. It is not something with which to score political points. Bravo to the Germans for having a backbone and for fighting for truth in a world which seems destined to forget what that means. DC