Data-Driven Crypto Economic Modelling - Philip Gradwell - Chainalysis

End of the Chain

About this episodeLearn how to say "Chainalysis" from Philip Gradwell, the company's chief economist and data driven analytic. He chats with host Samuel McCulloch about what on-chain economics and their use in day to day operations and analysis. Philip Gradwell is Chief Economist at Chainalysis, the blockchain analysis company. He analyses on-chain data to understand cryptocurrency markets. This includes identifying economic fundamentals, how cryptocurrency moves on-chain between exchanges and across borders, and the nature of crypto crime, amongst other topics. Prior to joining Chainalysis, Philip led a team of economic consultants working globally on energy system analysis and climate change economics.Philip's LinksLinkedin | Medium | TwitterChainalysis' WebsiteWhere to find the showiTunes | Spotify | Stitcher | Youtube | RSS FeedWhat to listen forWhy blockchain has much less data precision than people think and why the datasets are noisy.Why Chainalsysis’ core work is really about mapping datasets of entities and their relationships to one another.Why the interpretation of the data in the Crypto-economy is so much more complex than in Fiat economic systems.What the biggest challenges facing on-chain economic studies are and what Philip will be working towards solving in 2020.Why the creation of Stablecoins is about the demand for a dollar-denominated product which is regulated in a different sphere of jurisdiction from the one the underlying asset originated from: the USA.Why Tether was essentially filling a gap in the market for a stable fiat on-ramp and meeting the demand for a privately issued tokenised dollar in 2018.Why Chainalysis’ on-chain metrics during the Bitmex implosion provided data-driven insights into the market structures and the price movements of Bitcoin.How daily inflows and outflows of cryptocurrencies from exchanges correlate to price movements due to the illiquid nature of Bitcoin and cryptocurrency markets.Why Philip believes the fundamentals of Bitcoin are stronger than any other Cryptocurrency but that DeFi still has many maturity cycles to go through.Why we will be exploring a new paradigm in terms of monetary and fiscal policy in the fiat world after the Coronavirus induced recession.Why Philip worries as an economist that we had not gone far enough into the ‘future’ to see the consequences of the last ten years’ expansionary monetary policies after the 2008 crisis, but we have just doubled down with the economic responses to the Coronavirus in 2020.SUPPORT THE SHOWIf you like End of the Chain you can help support the show by doing one of the following:Help keep this show going by sending us $5Make a Tip - Send me an email after so I can mention you on the show.Bitcoin: USE THIS LINK FOR ADDRESS REUSEEthereum: 0xDAb148614f22dDa800cF006Be7932eeEB75AC644Leave a Review on iTunesShare an episode with family and friendsFollow me on Twitter | YoutubeIf you are interested in sponsoring the show please send me an email.Show NotesChainalysis analyse chain data for regulatory analysis and for clients that need to trace transactions on the blockchain and how they are tied into the real world.What does a Chief Economist do? Chief Economist is one of the stranger roles in an organisation like Chainalysis. Because the core of the business is about understanding transactions on the blockchain and how they link to the real-world entities, this is mostly used by law enforcement agencies and compliance purposes. If you look at a blockchain it is a complete economy, so its individuals sending money between themselves in exchange for services. I am here at Chainalsysis to try to understand the crypto economy from that perspective and to take the macro view and describe the trends we see in usage patterns in Bitcoin, Ethereum and all the cryptocurrencies we cover.Chainalysis covers a lot; they work with some of the largest exchanges in Crypto. They also are providing services for a lot of people. Compliance is an int