Pontem Network x Aptos Monkeys Livestream Recap

On our November 11th livestream, we had the pleasure of hosting Aptos Monkeys, a community-centric NFT project on Aptos,  as our guest.

Alejo: Thank you, Aptos Monkeys, for joining us today! What are your thoughts on what’s happening in the tech and blockchain worlds today? I’m definitely bullish on DeFi and bearish on CeFI. I think we might see some hard times, but the teams that are resilient will definitely come out stronger and better prepared for public catastrophe.

Aptos Monkeys: I do agree. I want to offer my prayers and condolences to those affected by the past few days. I know a lot of people have lost money. It’s not a proud moment in crypto history. It’s a day we’ll all remember that came with a few lessons, like own your private keys and not all that glitters is gold. I do hope the best outcome for everyone will be obtained soon. Trust and transparency are paramount, and that can only be achieved with decentralized finance, which is why we’re bullish on Pontem.  

Alejo: It really is tragic that a lot of people, especially outside of the US, are going to be very negatively impacted. $10 billion is a lot of money that is just now questionably there or not. It’s definitely tragic and I think we’re going to lose a lot of consumer trust. I hope people understand some of the nuances between these entities and centralized points of failure, and the actual true ethos and meaning of why we’re here. If you’re affected, we’re all here for you. This is why it’s important to be a part of a community so we can support each other through this.

I think the best thing we can do now is learn. This trope of “not your keys, not your crypto” has been around forever, and should continue to be around forever, but I think people got comfortable, given the amount of trust that was given to these institutions. A lot of people and institutions, especially outside of the US, are definitely going to be impacted by this. I hope that all of that negative sentiment isn’t misdirected, and hopefully people see the importance of the centralized finance institutions being able to be huge points of failure and we move to more decentralized approaches.

Now with Aptos, high-throughput use cases like this should be possible for relatively low fees. For a long time, I think a lot of these use cases weren’t possible, like a decentralized exchange that can manage millions of people’s requests at the same time. But now with the scalability and throughput of Aptos and Layer 2s on Ethereum, we’re slowly getting there. I hope folks realize that this is the reason we’re here: to enable peer-to-peer finance, decentralized finance, and get rid of these intermediaries that are bad actors re-hypothecating and using fractional reserve banking to essentially make profits, which is not sustainable.

Aptos Monkeys: I do agree, and it’s been a crazy time. I have a lot of friends who got funds stuck at FTX, and these are funds that have taken months, if not years, to build up. And seemingly out of nowhere, they’re probably gone. I think what you said is important. We need to redirect and do something productive to create a path forward that minimizes these kinds of risks, or black swan events.

Alejo: It’s crazy because it’s just a pattern in crypto. There have  been several big exchange blow-ups, the most memorable being Mt. Gox. To be honest, I don’t even think FTX  is as bad as that one because back then, something like 20-30% of all crypto was in that one exchange. The ecosystem has definitely seen these, but the most surprising part is how relatively entrenched this institution was in the ecosystem, and all of the support that was behind it. Mt. Gox was questionably a hack, maybe a scam, but this was just an overleveraged credit risk that was not managed well. This happens in traditional finance all the time -- it almost imploded the entire world economy in 2008. It’s a common occurrence and I think people maybe got a little bit too comfortable.

The solutions are getting there, and I think the hardest part is getting people to trust themselves. At the end of the day, that’s all you have and it’s part of the ethos here, custodying your own private keys. There should definitely be some trusted third-party institutions for some use cases, but I think that’s what’s powerful here, that you are back in control of your own financial freedom. Freedom doesn’t only mean having enough, because we can see that that doesn’t mean anything if the institution you’re trusting to keep your funds safe takes on undue risk.Then everything you worked for is not yours anymore. It’s not financial freedom. Financial freedom is owning and having access to your own private keys, which we’re learning through some hard lessons is the way forward. The market recovered from Mt. Gox, and I believe the market will recover from this. It’s only going to make us better and potentially catapult us into DeFi a lot faster.  

Aptos Monkeys: I do agree with regards to getting over these. What doesn’t kill you makes you stronger. We’ve had bad days before. Mt. Gox back then was crazy for everyone, but we still pushed through and this event will also be the same way. We’ll dust ourselves off and move forward.

Alejo: I think the crazy part is, bitcoin itself wasn’t affected too mcuh. And that’s not to say there won’t probably be some contagion. I think a lot of institutions were likely counterparty to FTX and Alameda, so it’ll be interesting to see it. It will obviously continue dropping, as it’s dropping right now. Hopefully bitcoin itself will be resilient.

Aptos Monkeys: Regarding bitcoin and the price, I’m no conspiracy theorist, but the timing was impeccable. We have this crisis two days before one of the best CPI prints of the year.

Alejo: Oh man, and that just led to the market collapsing a significant amount and then bouncing right back.

Aptos Monkeys: If there was no FTX incident and with the CPI data that came out yesterday, we might have made it through to 25, 26, 27. But it is what it is.  

Alejo: That’s true. But I think all this bad debt getting removed from the market is good. I think what we’re also learning is the macroeconomics of supply and demand for something that has finite supply. There’s only 18 or 19 million bitcoins, and they can be re-hypothecated on centralized entities and potentially decentralized entities, but that’s at a huge risk because you can’t mint more of them. Minting more dollars is a way to bootstrap economic activity in times of liquidity crises, so there are benefits to minting coins whenever you want. But there are downfalls, which we’re seeing now. Sure, you can mint coins to use as collateral to borrow bitcoin, but there’s only a finite amount of bitcoin left and most things are paired to bitcoin, which is how most people evaluate crypto. A hard lesson to learn, but don’t re-hypothecate bitcoin on decentralized entities because you’ll get wrecked.

Let’s turn to something else. Monkeys seem to be a trope in crypto. Can you tell us a little about yourself and how you got into Aptos Monkeys?  

Aptos Monkeys: I’ve had a thing for monkeys ever since I was a kid, because my first pet was a monkey. Then I studied computer science at university, which was cool, but coding never really resonated with me and I found myself more on the business development/ideas/entrepreneur side.

Back when I was 16, my friend and I coded out a forex bot, which did well for a while but then it crashed. It was a good first lesson to learn. After that, I spent some time in sports trading, which I did arbitrage across. But with sports trading, the liquidity is not always there to support the large ticket sizes, and then you start having problems with bookkeepers because you’re basically taking money off their exchanges. So I ended up getting blocked from most sites.  

Alejo: Which is another argument for decentralized exchanges.

Aptos Monkeys: That’s a very good idea actually. Bringing the sports book model into the decentralized model works both for the customer as well as the bookkeeper, because if there is an arbitrage opportunity because of a mistake in your code or pricing, the market will teach you a lesson and bring it back to normal. The balance is already in the market. You don’t have to control anything. The market will tell you to fix your price because somebody is going to use it.

That’s a very good reason to go to decentralization, because people will help you with making your system work. It will get arbitraged into what it’s actually worth. The second reason it works is proof of funds. With bookkeepers, we don’t know what’s happening or where the money is going. We don’t even know if they’re loaning it back to a system to trade crypto with our sports funds. But with the decentralized model, you can see that the funds are there.

Alejo: That’s an issue that’s recursive across all of finance. Look at Robinhood and the situation that happened with the meme stocks like GameStop and AMC. They halted trading in one direction because of a liquidity crisis, which is crazy. It was a large, established institution and they were “bailed out” by their backers. We only see the worst of these issues when they blow up, but they’re probably very frequent and we now have the tools to stop that bad behavior. And it may not even be bad behavior, it could just be a function of how outdated the system is. Decentralized systems allow for immediate settlement of financial primitives, and it’s the time lag of centralized entities that allows for inconsistencies in the spreadsheets. I’m really bullish for this technology to really upend the way that finance and most applications exist. The technology in the world is evolving and we’re moving towards a new normal.

Aptos Monkeys: The market has a way of fixing itself with time. At the end of the day, what the market wants is what’s going to happen

Alejo: Let’s take some questions from the audience and then we’ll answer some questions that the community asked.

1. What utilities will Aptos Monkeys have in the future?  

Aptos Monkeys: What we want to do is kind of old. The vision for our NFTs is to be a social identity to represent people on their socials. The main goal is to allow people, through our NFTs, to meet like-minded people like Pontem and other builders on Aptos, connect with them, nurture this emerging community, foster new ideas, etc. We want to foster this ecosystem and bring people together to help build out this ecosystem in a positive, scalable way. We want to empower this. And part of this is definitely creating tools to empower the ecosystem, whether it’s fun and games like raffles, or alert systems for NFT trading, or maybe DAO tools for voting.

We also have things we want to work on through our collaborations and partners. These ideas come through at an ad hoc moment when two brains are brainstorming and they come up with a very unique idea. We want to be at the forefront of this in order to be given the resources to make it a reality. I think Pontem can attest to this. We are open to ideas and discussions. In the future, we’re getting a tokenomics expert to bring in some order or gaming rewards to our community that work with our tools.

Alejo: It’s pretty cool that, as an NFT project, you’re building community tools. Your Rafflor tool is really cool. You can pay 1 APT to enter raffles for an Aptos Monkey with a floor price of 15 APT.

Aptos Monkeys: The thing you have to watch out for is, at closing time, you may have an attack on that raffle. So do be careful. It’s been happening because the website or tool got a lot of traction and we found some scalability issues with regards to speed and server size. We stopped the creation of raffles. The ones you see have been ongoing for the past few days. The system is just processing all the current raffles. The creation of new ones won’t come for another few days while we push out more stuff like filters and collection size. Also, a dApp for users to know what raffles they got involved with.

2. What does your partnership with Pontem look like?

Alejo: I can actually drop a little bit of alpha here! We’re working to include utility in a decentralized way for other products, including those built by Pontem like Liquidswap. We’re also working on a farming capability which will be completely public and permissionless, so folks can set up their own custom pools. We’re also looking at ways to integrate NFT utility for specific collections such as Aptos Monkeys.

With utility and a strong community, folks will want to build with it. We’re excited to use this native primitive which is almost like a community building block. Each person is a passionate follower, because it’s an identity for folks and you can build utility, games, and endless possibilities on top of it. We’re excited to build more features and use cases as we continue to work together.

Aptos Monkeys: I do see our partnership being very crucial. It’s through interactions with other builders and like-minded people that ideas are thrown out and drawn on, and you can come up with something that is unique and beneficial for people.                  

Alejo: That, plus real people putting their heads down and building stuff, which might be even easier now with Move than on other ecosystems like Solana with Rust or even Solidity on Ethereum. I’m excited about all the cool products that will be built on Aptos that we’re already seeing, but it will take time. I’m seeing a lot of DeFi projects and NFT projects communicating with each other and helping each other out, which I think will be a strong benefit of the Aptos community. It’s such a close community and we’re all so open to help build each other up, which I think will be a key benefit that will make everything stronger.

Aptos Monkeys: I agree. The vibe is actually something I have not seen anywhere else. I’ve been into research, trending, and crypto since 2017, and I’ve had my fair share of losses and wins. I’ve seen communities being built out and how euphoric people become at the top of price action, and how hopeless they become when it bottoms out. And I’ve experienced this all with people.

Something I’ve noticed is that the community being built on Aptos, the collective spirit and the way we’re always trying to collab together, is not something I saw in the early days of ETH or SOL. They thought that competition was true isolation, and I don’t believe that. I believe that even in the early stages like Aptos, competitors need to be able to sit at the same table and plan things together. We’re the pace setters as of now until new members are on board and in the space.

Alejo: Exactly, and it’s that composability that comes out of us putting our brains together, even as competitors. We can be collaborators and competitors at the same time to help build and make the user experience better for everyone. I definitely echo that sentiment that it’s rare to see, especially in crypto which can be very cutthroat. Despite the competition, new innovations can come out of collaboration. The good vibes are really a reflection of us, the people here building. We all have relatively good values and that will be reflected in the products that we build and the communities that follow us. It’s going to allow us to thrive in this new world we’re moving into.          

Aptos Monkeys: I totally agree. We’re in the midst of a pretty bad bear market, but we’re still out here pushing stuff and working together and trying to create positive vibes. If we’re able to do this in the midst of a bear market, only God knows what we’ll be able to do in a bull market.

Alejo: I also think that there’s a filter of quality where the people that are here now are here for the values and ethos. They want to see this technology thrive and get adopted. They understand the inherent dangers in centralized finance, even in the crypto space where we’re seeing these centralized institutions blowing up. I think you see a higher quality of people building and in the communities.

When the next bull market comes, we will have already built a culture of respect and sustainability. We’ll have learned from past cycles, and hopefully it won’t be another culture of exuberance and high risk taking that brings us together. I’m excited to continue building with you and a lot of folks on Aptos and I’m really excited to have you here.

Aptos Monkeys: The pleasure is all mine. I’m really looking forward to the stuff that we’re going to build out. We’re just short of being three weeks old, in terms of us being on mainnet, but things are looking good. Things are very early and I can’t wait to look back in a few months and see how things have grown.

Thank you Aptos Monkeys for  talking to us and thank you to everyone that joined the live and listened in. We’ll see you on our next live! We have livestreams every Wednesday and Friday. Check Aptos Monkeys out on their website, check out their collection on Topaz, and follow them on Twitter and Discord for updates on their project.