AI + Crypto: Building the New Internet of Money ft. Micky Malka

Ribbit's Mickey Malka on money that carries its own rules

Mickey Malka grew up in Venezuela, where hyperinflation and capital controls taught him how fragile money is. He went from a broker dealer sold to Santander to Ribbit Capital, and his thesis now is that fintech and crypto have merged into one market of networks where 15 to 30 companies from the last decade become the biggest financial services firms. His deeper argument is that money carries its own rules and knowledge, and every company is a token factory.

Takeaways

• A few fintechs will become finance's giants. Malka's thesis is that 15 to 30 companies founded in the last decade will compound into financial services' largest firms, with Coinbase and Robinhood already in the S&P 500. Ribbit's 2022 investor day opened with a slide saying fintech is dead.
• Crypto and fintech are becoming one market. Regulation has given a stamp of approval to layer-1 networks like Ethereum and Solana, which Malka now thinks of as networks rather than crypto. Bitcoin is diverging into its own asset category, and the market is still experimenting with meme coins and AI agent coins.
• Money without knowledge is not money. Malka argues money now has to carry rules, smart contracts and decision trees, so knowledge and money must be combined as machines take on more of the work and decisions. He sorts tokens into identity, expert, asset and real-world buckets.
• Every company is a token factory. Companies take in the tokens they need and hand out tokens to somebody else, a pattern Malka says shows up on Google's and Visa's earnings calls. Tokens also absorb attention, so money stops being a fight for attention.
• AI points to smaller teams and less dilution. Malka expects smaller teams and less dilution, leaving founders with more ownership, and points to Fiverr's plan to cut 30% of its workforce over AI. Entry-level workers may be hired by agents, and today's agents still need a new interface, possibly glasses.
• Node buys CryptoPunks to give them a home. Malka contributed money for Node, in Palo Alto, to buy the CryptoPunks IP after it ended up in corporate hands. The foundation soft opens in December and opens publicly in January, with a KPI of 10,000 unique punk holders in ten years.

Ribbit's path into crypto

1. Developers at his Argentine startup asked to be paid in bitcoin around 2010, so Ribbit bought some.
2. The fund had no custody, so it built Xapo.
3. It became an early investor in Coinbase and Revolut.
4. Malka told the Robinhood founders they would convert 2% of their 100,000-person waiting list. They said 60% and converted 70%.