Ex-Goldman Sachs man articulates the appeal of the $400,000 status symbol

What about the Bored Ape Yacht Club? Are the photos reminiscent of the Gorillaz album cover in 2005 are inherently cool and therefore a very good investment, or is it just because people like Gwyneth and Snoop Dog joined, so less cool people try to soak up the vibe by spending their money the same way?

You need to spend a lot. Gwyneth and Snoop didn’t mention how much money they threw at their monkeys, but Raoul Pal, who was a former co-head of European equity hedge fund and equity derivatives sales at Goldman Sachs at the time retirement money was on offer, boasted of his own recent purchase, which cost $400,000.

In a blog titled ‘Why I spent $400,000 on a monkey .jpeg’ Pal, admits buying an Ape seems ridiculous and people may think “I’m f*cking mad”, but says people who hit him with these judgments are “norms” and NFTs Bored Ape are both naturally enjoyable and a bridge to the future.

Pal’s monkey, pictured below (Source: OpenSea), is known as Seneca. “He’s wise but pretty cool and looks a bit ‘tired’…” Pal says. “I bought this particular monkey because it’s a clean and simple design and I liked the rare laurel wreath and its symbolism,” he explains. Pal fully understands his purchase: “The bloodshot eyes of Senecas suggest I may be smoking some local Jamaican weed…”

It’s not just about liking the picture, though. Pal says NFTs are “spearheading the future of identity, tokenization, culture, and the metaverse.”

He adds that Bored Apes in particular are valuable due to the strength of their brand. There was a merger with Adidas; community members can sell “merchandise”; celebrities join (Gwyneth, Snoop, Eminem); music labels join and create Metaverse groups; the musicians themselves join it and create Metaverse groups; books are written about it; he met the founder at a “posh private event” and understood that they were building “a web 3 metaverse, media, fashion and art brand from the ground up”. And then Pal saw this launch platform for Yuga Labs (which creates Bored Apes) $450 million in seed funding, revealing they have a 98.5% profit margin (“it’s incredibly profitable”). And that was even before the launch of the Ape Coin…

At this point, Pal is writing in italics, bold, or all caps, or all three, and is in a clear state of overstimulation. Basically, he thinks he spent $400,000 on a passport to a new kingdom: “all these social tokens work for the different models of digital sovereign states, and I think that’s where we’re headed.”

Bankers who left Goldman Sachs more recently and are wondering how best to invest their bonuses in volatile markets may want to take note. You can get a Bored Ape here.

Separately, the employees of Jump Crypto seem to have had the kind of offsite strategy meeting that is incredibly intense and not because of the bonding games or the revelation that everyone is an ENTJ on the Myers Briggs test.

Dave Olsen, president and chief investment officer of Jump, said Bloomberg that about 20 members of his team were in a “little little room” “in Miami” in February, strategizing on cryptocurrencies when a member of the team suddenly noticed that a “high-tech check forgery” was happening on their system.

Jump crypto has a system called “Wormhole” that bridges the Solana and Ethereum blockchains, for example, and allows individuals to transfer value from one blockchain to another. As they sat in their small room, it became apparent to the team that an outsider had discovered a weakness that allowed them to use the wormhole to steal Ethereum. Although they could see the heist happening, those in the room couldn’t “pull the plug from the wall” because Blockchain isn’t like that. Instead, they had to contact 19 guardians to get permission to bring down the system. It took 20 minutes and during that time $325 million was stolen. Everything was very “tense”, admits Olsen. Offsite Trad-Fi sites seem like child’s play by comparison.

Meanwhile…

Lee Smallwood, COO for North America Markets at Citi, leaves to join Hivemind Capital Partners, the crypto investment firm founded by former Citi trader Matt Zhang. He will be managing partner and COO. (Bloomberg)

It’s a great time to be in Hong Kong, where staff shortages are pushing wages up and no one is moving for less than a 20% raise. (Bloomberg)

JPMorgan is hiring 100 people in Frankfurt this year. (Bloomberg)

The UBS layoffs appear to have included Koby Englender, Managing Director of UBS and Senior Banker in its Emerging Markets Equity Capital Markets Unit. (Financial News)

The CEO of Commerzbank is now paid less than when he was head of retail banking at Deutsche Bank. (Twitter)

Russians are disconnected from Bloomberg terminals. (RBC)

Spac’s bankers agree to lower their transaction fees. Credit Suisse agreed to cut its fees from $14.5 million to $10 million in a merger between a spac and a broadband company earlier this month. (FinancialTimes)

Proxy advisor Glass Lewis recommended investors reject UniCredit’s compensation policy because Andrea Orcel earns too much. Last year, Orcel obtained €6.7 million including €5 million in opening bonuses not linked to performance. (FinancialTimes)

40% of those who took CFA exams last year were women, up from 38% in 2018. But women make up just 19% of CFA charter holders and that figure has held steady. (FinancialTimes)

If you feel stressed, then pRepeated, rhythmic movements, such as walking, rocking, chewing gum, or tapping bilaterally (feet or hands) tell the brain that you are safe. (Bloomberg)

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James V. Hayes