Are Animal Spirits Returning Onchain? | Analyst Round Table

Transcript

I think um maybe the other big one is with some excitement back in the markets again we're seeing meme coins and activity rip again um salana activity noticeably up ticked um everyone's favorite pyg me hippo token went crazy and spawned a bunch of other zoo animals um you know Animal Spirits going crazy uh on the timeline and on the Chain again chaos Labs the leading onchain risk management firm recently launched its new flagship Oracle product Edge Edge delivers integrated High Precision risk and price data for any application with the market follow and reach out to chaos Labs on X to learn more nothing set on zerox Research is a recommendation to buy or sell Securities or tokens this podcast is for

informational purposes only and any views expressed by anyone on the show are solely our opinions not Financial advice bacho Ryan and our guests May hold positions in the company's funds or projects discussed all right what's up guys welcome back to another episode of ox research today I'm joined by Mark and Ryan from the blockworks research team uh Mark Ryan thanks for coming on guys what are we looking at today how do we feel about the markets um anything exciting going on or categories tokens that we're that we're looking at uh I mean I was on last week feeling pretty bullish about the markets not much has changed I mean Bitcoin is kind of struggling around that 65 64k mark But then I'm looking at like inflows for for

on ETFs past 4 days so Bitcoin has been over a billion dollars and I think for eth past four days has been like something like 150 million and without like actually running the numbers or looking at the data just off of my head I think that might be the most 4-day net inflow run ethereum ETFs have had well the US ethereum ETFs have had so those are like little positive signs Plus stable coin market cap is growing so you know more inflows into chains more inflows into the ETFs you know things things are looking nice um didn't seem to be like a traditional down September month for Bitcoin as it's historically been so yeah yeah um it seems pretty positive out there uh from a price

action perspective I think that the blockworks research team has put out some pretty interesting um pieces on where we see value in the market um our the arbitrum piece was was pretty nicely timed we have a pretty interesting one on mettis that's come out previously we did some interesting work on metaplex which has worked out really nicely so you know a lot of the places where we saw value in the market we're seeing those um we're seeing those still compounding in the current environment which is nice and we have some interesting wrecks out um so eth is on my screen at least is trading at 06 which is near all-time highs which

has been um you know a lot of people on the Block Works research team have been pounding the table on that one so um so far so good um still pretty skeptical of eth flows on the margin um I think if you are going to get bullish on that it's much more likely to come in q1 than it is today but you know who knows when fomo kicks in Anything Can Happen yeah good call outs I think um maybe the other big one is with some excitement back in the markets again we're seeing meme coins and activity rip again um salana activity noticeably up ticked um everyone's favorite Pym hippo token went

crazy and spawned a bunch of other zoo animals um you know Animal Spirits going crazy uh on the timeline and on the Chain again so um that's always interesting to see I think when we talk about maybe reports as well um a mem coin report I think was also quite interesting when you look at the top gainers for the past week um those those dogs and those frogs are back up at the top again so um it's just one of those things we've continued to see sorry did you plan the the animal spirits reference no that just worked out for me that was fantastic and um I guess to keep going in terms of like exciting things or maybe just positive positive things

we're seeing in the markets not to be you know you can excuse me for being a little bit of a macrol lar again um for briefly but we're seeing excite in Asia as well as the US you know recently over the past month and maybe year I guess you could say at this point you know the US kind of policy shift towards crypto assets you know ETFs getting approved um the sort of Republican GOP positioning in regards to crypto has changed quite a bit they've become fairly positive um we're seeing maybe some you know sources in in China say that you know former ministers are saying that they need to take another look at crypto maybe their policy um their stance on it I believe trading of crypto is still maybe banned in mainland China but um you know they

they they tend to flip-flop their position pretty frequently actually like historically it's you know it's been banned and then it's not been banned so um you know maybe the sort of positioning from the US policy-wise and you know the activity in the markets is is having them consider otherwise um and we're seeing you know the Chinese market um has also been doing quite well lately um all markets honestly at this point have been doing quite well lately I mean I would take I would take anything coming out of China with a grain of salt um you know especially especially when it comes to crypto and especially as it's not from somebody in like current leadership it's you know it was from like a round table this weekend I mean that being said you know when I heard that I was thinking is this kind

of like desperation are they you know you know they had they've had China's had five quarters of like deflationary pressure I think that's like the long longest since they joined the WTO and you know the the stock market hasn't done well real estate debt you know it's just been a pretty subpar to say the least few years for China and they've just released like these liquidity packages trying to like boost every sector that they can and it seems to be mostly from the supply side which you know I'm no Economist but doesn't seem to be it seems to be more of a demand issue um with China right now so maybe I think the the packages should have been

more focused on that and even then I still don't think they're large enough but you know it just makes me think are they trying to like seep into these different ways like crypto to try and get any kind of demand just from just regular retail or whoever like just invigor this to try and get like prices and GDP and everything up again because I mean they're projected to coming under 5% this year which is not you know not typical for China bar this covid period so I don't know things look kind of rough over there and then Hong Kong is their is their Western outlet that little like guinea pig to try all of these stuff which I'm happy for you know it's a two system kind of model but yeah I'm I'm not overly you know I'm not overly bullish on on like this this one report

from them yeah some pretty um I mean historically when you see um countries either explicitly ban Short Selling or is is Stern language around like how companies need to buy back their own shares like me I don't I haven't really looked at it systematically maybe it signals a bottom um but it does signal it certainly signals desperation right like to have to kind of impose those measures on like really important companies is like it says a lot it says a lot um yeah China's been tough it's um yeah you've all seen that

chart where it's like number of like economic metrics China posts over time and then she gets into power and it's dropped off a cliff um so like in my career and thinking about China I kind of yeah totally always taking with a grain of salt seeing how bad the measures have been coming out of China I'm like shocked that we didn't go into a global um recession given how important the country is and especially how important it was in 2008 and getting out of that crisis 2009 um so yeah I don't know what the hell's going on out of China I don't trust the data um it's really hard to figure out but the stock market's ripped right um an insane rip so that should be

good for liquidity hopefully and then therefore crypto yeah it was 25% up in like a couple days I don't know how sustainable that is but then when you're talking about like how how the world didn't enter into a kind of you know China pressures on the world I think it was like from the Trump era policies when they started to put increased tariffs and kind of like disentangle themselves a little bit more kind of helped with that helped with that like Supply shock but then also I kind of think that China's deflationary issues kind of help the rest of the world like in from from their inflationary Edge like while some countries were exporting inflation China was exporting deflation lower prices lower currency lower labor cost and you know if that low energy

prices so that I think that lowkey kind of helped with the rest of the inflation situation globally so I think it's been great thank you China for the rest of the world maybe but you know their sacrifice is noted yeah we can we get all of our cheap products um shipped over from Teemu thankfully um you know providing Americans with uh and other other you know people globally with uh very cheap household items um it's been a nice spoon for for anyone that needed that chaos Labs the leading onchain risk management firm recently launched its new flagship Oracle product Edge Edge delivers integrated High Precision risk and price data for any application with the market after 2 months of securing

Jupiter Edge has already secured 30 billion in volume and more than 60% of all Salon of per volume EDG is comprised of three components High Precision price data with an integrated risk engine automated delivery of real-time parameter adjustments on chain and secure delivery of custom data points via zero knowledge proofs follow and reach out to chaos Labs on X to learn more thanks again to chaos labs for sponsoring today's episode hey guys permissionless the event for crypto natives is heading west to Salt Lake City and we're bringing the biggest names in crypto together for an incredible campas event join me in the rest of block works on October 9th to hear for more than 200 Industry Titans including Nick white from Celestia shiram from Igan and Keon from Mona the conversations at permission list will be

covering the hottest FES in crypto including modularity reaking the Bitcoin and Solon ecosystems Ai and crypto rollups l2s institutional adoption and of course the November election that will be right around the corner we couldn't be more excited about this event and it's happening in one of the most beautiful places in the US ticket prices will be increasing towards the end of June so get your ticket today make sure to use the code so I get some credit and bragging rights from the rest of the team uh use zx1 for 10% off on your ticket one more thing we're also hosting permissionless re hacka font in collaboration with bbx the theme this year is a multi-chain future to build a better cross chain experience so I don't have to have a heart attack every time I bridge to a new chain all Hacker found

participants will receive a free ticket to attend permissions so if you're a developer come join us in Salt Lake City team up with fellow devs and build the multi-chain future I guess maybe another another topic that has been um challenging and kind of plaguing the timeline since forever is this sort of eth versus Soul debate that his only grown hotter and hotter um ironically even in Asia in Singapore um it was a topic as well at recent conferences um we're seeing a lot of people begin to weigh in publicly and really either pick a side or align themselves in certain in certain directions um you know we've got even the IG layer team sham is is weighing in on his

thoughts um in regard to like toi's thoughts or you know kind of thesis in kind of presenting salana this future State you know better than NASDAQ decentralized alternative um I think there's some people hopping on that train there's other people you know maybe taking the other side saying there's no way like you can't beat like a centralized server um curious like I think we can take this in many directions we can talk about you know eth road map we could talk about you know differences eth Soul we could talk about his decentralized NASDAQ achievable um curious your guys kind of First Take thoughts on this this argument that kind of continues to permeate you know socials and the broader

Community uh I'll just say you know when when when toi and shiram are like debating on Twitter like sometimes what they say might be a little bit too gigabrain for me at the moment but from from what I understand I a centralized machine will always outperform a decentralized group cluster of machines right and you know I think maybe I think that's like computer science 101 it's just one of the tradeoffs with adding more nodes especially with the potential for adverse serial nodes to the network and then I saw to's point about okay what if there is you know uh knowde that it's closer

to the news event you know let's just say it's in in Taiwan or wherever and it has to make a you know trip all the way to the NASDAQ and NYC then you know it could be faster with multip concurrent proposal which isn't even live yet and then I think the on the other side of that sh was saying that these large data exchanges have also have um data centers globally distributed as well you know we wouldn't call it decentralized but maybe just distributed and there's no need for consensus on it there's you know even if it's an optimistic protocol like that is the default in a centralized sequence

you know machine because it's all your own no so there's no there's no concept of pessimism there's no concept of like I'm if I'm if I'm going to trust this it comes from it comes from yourself so I just I can't see how I can't see how it can compete to the same level as a NASDAQ maybe you know you know maybe it can't compete in the same way like maybe you're not a high frequency Trader you're Robin Hood user right I mean does it really matter to you between two and 10 milliseconds or you know 10 and 50 no I don't think so so maybe that level of experience is fine for you know most individuals but for most volume which

comes from institutions and hfts I think I hard to I find it hard to align with toally on this one but I mean I'm in the position where I would love if he was right I would love if blockchain networks could compete with nas that right please like please prove me wrong um and call me small brain but I just don't see it right now yeah uh not going to be uh pretend to be an expert on the um on the technicals here um the mul watching the debate happen in real time um you know like really sizing up like

who these people are and like they're demeanors and thinking about how that implies um or thinking about the implications that that has for what they're building is I think is pretty interesting um I really like it when I see a Founder um projecting flexibility uh or a team projecting flexibility um and and look I could be wrong like the these folks affiliations with the eth um with the EF um but I saw one one account um with a decent amount of

followers with the the ultrasound logo in the in in the name like lecturing toally on multiple concurrent prop concurrent proposers um and toally responds like are you telling me that like I don't know about mCP on Solan he's like yes we've been we've been thinking about this on for a long time and like this is how it works and I think he was just completely ignorant of like overconfident in his expertise and and ignorant of the history that it's been a conversation on salana for some time so like maybe he didn't really know who he was talking to or their expertise um it also just reminds me of like the Justin Drake thing right where like you know he's saying time and time again like we've already won um I think

those attitudes are pretty important for sizing up these projects um and thinking about their their forward road maps um I and and it has implications there um that's kind of that's kind of how I'm seeing it today yeah I think it's never great to see St stagnation um at the very least you know to Steelman kind of the eth side of the equation here it is great to see I think community members like really up and arms on both sides of this discussion I think you know we're seeing you know if you look years ago it's a community that was kind of aligned around around a forward vision and it playing out today I think there's a lot more like concern about what that

what that right kind of development path going forward looks like and there's a lot of you know debate about that and I would say that's probably arguably a good thing for them you know if they were continuing to to like move along at snail's pace on whatever the intended like future Target was um and not make you know fantastic Improv ments to the the Bas layer the the teac um division then um I mean think stagnation is kind of an opportunity for competitors to come in and and steal your share of the market so um we we've seen that a little bit with just like you know I think at this particular phase like the amount of demand that has come in whether it be I mean a lot of this is trading of meme

coins trading of silly things on chain um and it's you know not as achievable on like eth main net and even l2s you know has been scaling up quite a bit actually quite quickly but they're doing 50 60 TPS um and you've got Salas and you know s and Aptos that are doing hundreds to maybe thousands potentially you know possible on chain um and with the frequency and like activity of of the things that people actually do on chain which is largely just memes and other silly things today um you know it's just left us with this shift in where users and what users like can and can't do um on their sort of like

ecosystem of choice but on that point um so l2s can do it base as you said is maybe 6 TPS is running on evm I do think that an L2 that runs maybe anbm or maybe something on the Move Network I do think some a centralized sequencer can compete with the NASDAQ right because it's you know it's the same kind of philosophy you know and I personally don't have any issues with that in the sense that I'm not you know necessarily A decentralization maxy I want the properties of decentralization you know and if I can get that without decentralization then great um and I think you can get a lot of that maybe

not censorship resistance maybe not performant liveness but I do think you can get that with a centralized sequencer and so and and with an L2 you do get fallback options even if it's not the full package right now and so I do think something like that can compete or give you like near performance to NASDAQ so to speak but yeah and then secondly has you know there's this e Soul debate that we continue to talk about everybody continues to talk about um this I don't know if this is just me but the SOI Soul debate is starting to pop up again a lot more and people are wondering if you know you know same kind

of thing earlier Network maybe better Tech not as big of a community you know it's has having its moment right now whether that be from K's or not like I don't know if you all have any thoughts on you know is is SOI a credible competitor to Solana you know can can suie flip Solana in the future what do you all think what do you or is anybody on your timeline talking about that yeah I don't know about I haven't seen the calls for flipping but I have seen the calls for you know I think people this is like crypto's you know crypto community and like the space's favorite thing is you go down the list and you say and you look for something that can

is you know maybe a relative comp competitor valued lower um and you think okay this can surely outperform um you know this other thing that I'm looking I have seen calls certainly for people you know making maybe like this soul to S rotation they think that like there's maybe a greater um opportunity Inu um from this point forward relative to like the size that salana has grown to I think there's lots of talks as well continually about like the emission rate of Soul tokens I think people people look at that number and they get scared a little bit um so I think those are points to it the big question that I have foru and I think these are the same questions that like ethereum members have um when you look at like you know

fast chain ecosystems is there's this drawback there's this like criticism of like where is that demand for TPS going to come from I it comes up quite a bit now I'm not worried about over supply of block space I think you you need it um when you provision like resources in a data center um you'll like spin up um typically uh like 10x of what you need to prepare for spikes because you don't want the system to go down so you'll see like there's a lot of like just capacity in the data center that's not used um you know everyone knows the dark fiber story post the do com boom about how we didn't fully utilize that for didn't even use it for 15 years um so I'm not

so worried about that like it's better than hitting up against limits and then like having a terrible user experience um second thing related to TPS stuff is that it's pretty clear these chains are getting fast right now we'll see where fire dancer goes Aptos andu I think they have something to say from a performance perspective and you know I'm hopeful for manad Mega Ethan and the rest um I think what a lot of the discourse misses is that it doesn't really matter at this point like the things are going to get fast and it's all a BD game assuming and that like assumes that you don't have this like breakout consumer app that puts wallets in a ton of hands like if we just keep like grinding along with like this Defi and like incremental

social things and like deepin things which I think we will um but if you don't like have that zero to one app that just like takes over and makes like I don't know it was built on algorand and now everyone has an algorand wallet I'm not saying that's going to happen but um like unless you have that big moment like um this is all a BD effort amongst the foundations to get good Builders to build over there like you have chains with significant installed bases in terms of like dollar value on the Chain if you're a Founder like there's a way to profitability like there's a clear path there so like it the technical stuff matters a lot less today than it did four or five

years ago and I think a lot of people are still stuck in that conversation um Tech like you know um same thing with like like mobile operating systems right like we saw the same thing play out there um so yeah Focus I I think as an investor if you're looking at these different ecosystems like talk to the founders figure out which Foundation is treating these Founders the most who treating these Founders the best who's most excited to like work with these foundations I think that that's the real differentiator it's like that human touch yeah I think that's a great Point Ryan um one of the big kind of things that we're seeing is this convergence of

design as well I mean you touched on it but we're seeing this across the board even in you know maybe not ethereum mainnet but like bass for example is increasing their throughput targets quite heavily and you know the goal there is to hit a gigas a second um I think the you know maybe the implication of that is to put them into the hundreds or thousands of like you know TPS but regardless of like the number itself the goal pretty much for every ecosystem and and every you know piece of tech out there is to just be able to move faster and um enable more activity on their chains so I think that's super valid and the the main kind of opinion or thesis I've had on this for a while is just whether you can get interesting

applications and use cases that people actually want to use on your chain and if you can then you know you have a chance to to kind of keep moving and if you can't and you can't get anyone to build on your chain then you're going to have a hard time moving anywhere this um does this kind of lean more towards VC funded just applications and chains versus like maybe icos because we're talking about like community and Founders and who's excited for you to build and it's a lot about BD and I think maybe how much you raised has a lot to do with that so I mean you can hire a lot of community managers you can hire people to to reach out to Founders you can have hackathons you know you you

you can Market a lot more kind of like maybe what the monad and and bar chain are doing so does does does the convergence on Tech lead to more Reliance on money yeah I I don't have a good number on how much you need to to build a really high performance system you definitely need a lot of marketing I think apos raised 300 um I know I think I think kind of the one of the one of the questions in there is like what's preferable in this kind of like new paradigm where we have like some decently established user bases like icos versus VC funding more broadly and um it seems like the industry is really coming back around to

icos and I think there is something like really nice and fair about icos there's also some advantages like from like a from like a LP perspective if you want or like from an investor perspective um they're certainly more fair like people with less than um you know millions in Assets in the United States or effectively it's like illegal for them to participate in like things that can get them multiples on Capital and the Ico like really enables them to do so for the first time so I think that that's really great um more open access to capital is like obviously better for the um for the invest um for for the investor but also the project like you can like I think EOS raised 4 billion

like good for them like you can definitely like internet scale t cap tables are better than like you know um you know much smaller cap tables um I think that VC money though does have like a major advantage to Ico money still um and it's the um it is or like the traditional VC route and it's that like VCS are super helpful like there's a reason that you go to Y combinator in a16z like they have a Rolodex they will help you hire like critical people they like know a lot more than you they will help you drisk your project by setting you up with like initial customers like a anon on the internet who contributes you know

2500 25,000 bucks to your Ico can't do that and they probably won't do that um they think it's like a low friction way for them to get upside to your to your project but it's like very um they're very removed whereas a VC can be very involved the good ones right and that's what you want as a Founder so I think I think although the industry is like kind of trying to bring icos back and um I'm here for it I think there's definitely there's definitely like a fairness as aspect to it that I really um that I can really get behind but I think that it lacks the sophistication of um and just like

General helpfulness of having a VC partner yeah I mean I I think there's certainly something to be said for kind of the the VC funding kind of underpinning a lot of these like more successful ecosystems teams projects blockchains Etc um you know the benefits that come along with this like you know larger larger projects and Foundations and um VC interest lead to you know big conferences hackathons um opportunities for these like maybe early stage you know developers and and ecosystem projects to you know have people get eyes on their projects and maybe even you know secure checks from interested VCS um and you know the alternative of that is like you were

saying Ryan like if you're just um Dev on on Twitter or you know hope hoping people see your project and you know drop some some cash from their you know weekly wage um you know they're certainly not it's it's very unlikely that those people will also be able to provide you you know go to market support like strategy marketing other ideas that maybe you as just like a Dev or you know maybe your first-time founder and you just have a great product like there there's likely to be many other things that you need help and support with um and I you know I think we just see that being um kind of relatively successful in kind of bootstrapping and and helping you know maybe these strong engineering teams you

know put out great products and get them in front of people especially in the space and with how quickly like the crypto markets move like from ideation to product like you need to be very very quick or or somebody else has already built it and shipped it and like it's open source and then there's already nine Forks on Main net right like you need to have your idea and put it out like on chain and get funding and just go so I certainly see the value from that perspective yeah I I mean something that you eluded I mean you can raise a lot of money in an Ico right um and I kind of want to walk back something I said earlier I don't know if that's necessarily a good thing um you kind of want your team to have discipline um and having a little

bit of scarcity helps there to focus on what matters if you have much more than you need which has historically been the case with iOS um and probably will be going forward with um just given that anyone can participate and then that changes like the mix of sophistication um of people who can contribute like um when you have too much money you end up thinking about more things than you originally intended right you want to do bigger marketing campaigns you want to push more products like I don't know free money um it's it's like if you have a kid and you're raising a kid right and the kid like like you give the kid thing and it never everything it ever wanted and it

it does understand like the value of a hard day's work and then it like has trouble on the job market like when he older like that's a thing um and I know it's like a crude analogy for applying it to startups but there is there is such thing as having too much money we learned that the hard way in 2021 um and we saw with the like the track record of a lot of these icos that too much money isn't a good thing um so yeah I don't know I'm not convinced okay guys you are you are buming me out unfortunately I agree with everything you all have said but I just want to bring back the icos I just I just I just want them again so I think the conclusion is ICO is nice Fair VC is better in every other way potentially

except for this High market cap High fully diluted value low circulating market cap and then you know the price crashes because of the low float and then it loses enthusiasm because price drives narrative and then your project fails because of it and then I think we just need some kind of some kind of goetter team out there to bring some hybrid VC Ico Innovative bonding curve token incentive model you know so just if anybody's listening and you have something like that please please help help the space out well I think that the the more likely kind of go forward thing is not some interesting smart contract that solves it actually think it's just

like people learning their lesson um people like getting like for lack of a better term just like getting burnt or losing money or having a bad experience um you just see it in like you experience it in your career as like a novice investor who like chases a stock and it's going up and you were looking at it and now it's going up and you have to buy it because it went up and then you get burnt because you bought it at the wrong time and then you realize not to chase uh I think that probably the regulations have like atrophied this ability of like the general populace to like like participate in these things in a shrewd Manner and we just have there's going to be like a a period where like people are just going to have to figure

it out like they need like they need to for back of letter term like do do their own research and then there's going to be like services that curate these things for people and maybe like a supply chain that like does the due diligence for you like if you can think of like this free market of like Capital raising if we ever get there um so the market needs to mature I I think it's more likely that the market will need to mature then there's like a particular mechanism um that helps people people like launch a fair project um but not an expert on the mechanisms but that's just my intuition yeah I mean I think historically and especially in this

space with like the kind of prevalence of of um very sharp sharply drawn charts um consumer protection comes up a lot in this discussion of like you you know if you think you have kind of the um the smarts or the ability to pick out winners um I mean just the reality is that um it's it's not so easy and yeah I mean it's very likely if you open up access to do that you know there's going to be people that get burned and they'll have to learn their lessons about you know all the things that that you know regular investors learn about sizing and um how to take some of these bets and certain things so that's that's certainly always a point kind of to be made on that side but um I think if we're talking like from maybe an

ecosystem perspective there is certainly value here in like this VC approach in that you know if you're you're coming onto the scene as like a new ecosystem and you need to kind of build some traction and and get some you know excitement behind or even just get some teams kind of building in your ecosystem on your platform um you know it may be harder to just crowdfund all of that right just using going entirely through the Ico model it's like if everyone's eyes are on ethereum and salana um naturally it's going to be difficult to do crowdfunding on you know new chain new language new Etc um and so to get you know investors excited behind that and then to then have them also

excited behind the projects building in that ecosystem like that certainly gives you a leg up versus having to do all that yourself that's actually pretty interesting the ecosystem as like a branding for like um where where a retail person wants to put their Ico money that that could be an additional compounding effect there if icos really take off but if we're expecting any Market to mature and to grow maybe the existing investors in crypto who've been around for maybe a couple cycles and you know like for instance I have not thrown any money into many of those um low circulating cap coins because I kind of want investing schedules to end and you know before I put some money in and have

that fully diluted and circula kind of converge a little bit more because I've you know I've seen over the history of you know how market cap can grow but the price of the token Falls right simultaneously but then if we have new if you know if we continue to get new entrance into the space they are you know who maybe have no experience investing no experience in crypto no experience in valuation then it kind of like we continue to repeat the cycle in a sense we have maybe a pocket of it maturing and then maybe those individuals go on to be VCS themselves because of because of theyve a mass some certain wealth and thing and I think and I think that's like the kind of cycle that we're in now so I I I don't know how much faith I have in

mature investors and I don't think VCS will mature either because I mean there's greed there and incentives I mean I don't want to necessarily call it greed but I mean like everybody you know your job is to be a you know profit maximalist for your LPS so I don't know how you know optimistic I am about that you know path but um so I'm I'm still hoping for some kind of smart contract I maybe I put too much faith in Tech to to solve these issues but I'm not going to put it in in in human rationality of money and Tech over the over the medium to yeah I mean ultimately there's you know there's different ways that Um this can go it's like an individual if you're coming into the

space as like a new entrant um you know if you think that you can kind of become this this Elite outperforming kind of VC type and pick out pick out winners like sure go for it not to say that these are the same thing but we've we've certainly found that the market has realized there is another option for people that just want to see the returns and don't care about the DD and that's where the animal spirits come into play um you know I I think the reality is that people see the returns that have been achieved on prior projects like you know raising at you know tens of millions or even hundreds of millions and then going to billions Plus in market cap and and they think man I want a piece of that but I I don't

know that that these people that see that and come in are there for like the technicalities or you know the the infrastructure and and why we're building some of these things it's really just they want they want to see that that price multiple and so um I think naturally you know we've we've seen that the market has offered an alternative there where you know you don't need to have the connections and and the high Bank role to get into that if you just want to you know play with volatile things um not to say that that's like a replacement for that sort of activity or like an Ico but just saying that I think you know certainly people have realized this and you know we've kind of seen the category grow um as a result of that and then um maybe while we're on the

topic uh one last thing I guess we were talking ecosystems we were talking about I think originally s flipping Soul um was kind of the originator of this conversation so I guess what I want to pull up is um some recent tests on fired dancer um on salana test net um we saw some some things from breakpoint um they were showing you know 1 million TPS performance I think that was um you know certainly not maybe an expectation for real world scenarios that I think that was using you know the Nano token program Which is far lighter than um things typically happening on the Chain um but this test this test net kind of performance of fire dancer that we've seen um there's some data here showing

that like basically by running essentially what they call basic or what are enally like empty transactions um tps's of like 90,000 90k were achieved with that Nano token program again like 55,000 um or so were achieved and then with the token the normal token program um which I think you would expect with a lot of the regular trading that goes on on the Chain transfers and swaps and those things um they saw around 18 to 19,000 TPS in that test so I think today salana has been ranging over the past few months maybe between 600 to a th000 TPS so um um if you can look at you know a 10 to 20x Improvement in that that's quite significant over the current performance um we talked a little bit

about you know and obviously who knows in the real world you know that that number may change it might be half of that it might be a fifth of that who knows but if you know if they get a significant you know improvement over the current main net um throughput then that's obviously a big win for the team um the timing on that is still sort of TBD for like a full main net launch and when you know valid Val ators will adopt it but um it's certainly a good step forward um I I think the question there is you know we're we we sort of had this conversation a little bit earlier but um you know all chains are scaling um we need to see continued you like attempts and shots on goal with like interesting apps things that people are going to use

um whether that's consumer I mean there's a lot of things that people talk about I don't know if you guys have anything in particular maybe that you're most excited about but like for salana things that come to mind gaming deep in networks um social apps what are we looking for yeah I think it's um uh it's institutions coming to the mix in high frequency trading that is going to be the highest value activity for any crypto system they uh your your Bots your your hft trading shops are going to be both your highest frequency and highest paying customer across defy things which is the majority of crypto use cases today and probably in the future and um and you know fees

and meev to to the to the validators and stakers right which which is what you want to see value acrel to the Token so that's that's what I'm most excited about um I think for about two years the market has underappreciated how much of an impact fired answerer could have on the crypto space more broadly um I think it's interesting that it's coming at a time where salana has um maybe eight or so months now of downtime behind it and even like the last downtime that it had I think the market kind of shook it off so you know this this massive increase in scale um you know increase in cash flows to Soul token holders and um the history of you know waning history of downtime um

salana defi looks pretty differentiated here uh as well as the soul token so um I mean look when it's really hard to so like a lot of that might seem obvious but I think it's the most important stuff and like obviously you're going to have like new and interesting use cases like you probably see more micro payments in di or or sorry Defi and dpin um I think like the the prevalence of those really increases but like it's it's really hard to know um like as an early internet 1.0 user um you know was really hard to reason about outside of broad generalities like what increasing bandwidth and compute in everyone's pocket was going to enable

like I never expected an app like Tik Tok right like we knew that everyone's going to consume more video but I didn't know what form factor was going to be and for a while people thought it was Snapchat so um getting more precise than that is is going to be hard you got to take on a case-by Case basis but Salon defi here if they can maintain uptime and and figure out like and lose this waning or and lose this reputation downtime in the context of even 12th of fire dancer I think Salon defi is pretty differentiated um I might be sharing my age here a little bit but before snap on Tik Tok it was Vine for me you would do it for the so that was the thing but I think I'm going to Echo a similar thing where

I do think it's the institutions because I think that provides some legitimacy to the chain and plus I think defi is probably one of the most valuable activities that you can do on chain and you know during breakpoint I I was personally excited to see that Franklin Templeton was looking to build a mutual fund on toana blockchain directly and the reason why is because you know I look at some of these older I talk to some of these older funds and their hesitancy with Solan in the past has been the two main things that I hear is one the liveness issue which you know is becoming less of an issue and with you know additional um validator clients like fire dancer you know we'd have we'll have backup clients now you know

totally said that when it reaches 33% of the network Solana will know will remove the beta label so I think I think those livess issues are going to be a thing of the past hopefully you know not Maybe not immediately but you know we're on the path towards that and then secondly the other thing I hear about these funds hesitancy for salana was the lack of a multisig um you know not that salana doesn't have multisig but something a little bit more battle tested like you know safe is on on the ethereum network you know there's nois built this product safe which you can use throughout the L1 and multiple l2s and you know there's the equivalent of that I think on Solan could be squads but I don't think it's it's maybe not battle tested enough to for different

funds to be comfortable moving millions of dollars on to the network directly because I mean it's one thing to be down 5% but it's another thing to be down 100% so I think that these institutions are starting to move um on chain add legitimacy they'll probably provide more docs and support to all the others who are looking to mimic something of the same and and I'm excited to see more of this continue over the future yeah I think you guys call out a big Point here and I'm just going to pull up the uh salana Dex activity dashboard from the blockworks res platform um the the key Point here that you know institutions funds Etc larger players driving a lot of value to the

chain I think we we can really see that if we look at like Dex volume Dex activity by these wallet segments um it's pretty clear that like large high volume in terms of like lifetime trading volume and um you know consistent um trading activity is is driven by these larger whether they're Bots or institutions or larger players playing regardless it's it's few wallets um objectively so like Dex active add addresses by wallet segment we can see that um you know wallets trading over 500,000 in in lifetime volume there's maybe 30,000 of them out of like 20 million total um where you've got you know tens of millions of wallets with

less than $10 in total lifetime value and yet the percentage of of overall like volume traded um tends to be around like 70% this this 500k plus group um capturing o maybe over 70% of of total volumes um and we see that consistently throughout time historically um where these these larger um players kind of tend to drive the a lot of the kind of value of the activity on the Chain um is maybe the way to say it so um I think you make great points about you know hft um institutions um continuing to see like larger players kind of come into the space I mean that is where a lot of the value um and a lot of the trading that we see on chain today at least for dex's um is happening

that said you know things like deepin networks things that um can push lots of like low low low cost transactions obviously there is a you know there is value there it's just more in the scale right like you you you need hundreds of thousands millions of people using those things and then that drives you know meaningful revenues but it's a very different picture from you know a few large players can like really move move your network basically yeah um I know that there's a lot of thoughts too around social driving a lot of onchain activity um I'm a little skeptical there I think like from an asset is issue issuance perspective um one thing that one feature that has pmf is asset issuance on social

platforms so think friend Tech are a pump fun um I think that um I think it's pretty hopeful to think that outside of asset issuance you're going to see um social drive a lot of onchain activity um the reason is because a lot of social today is very um um High Fidelity and interactive so think like video um and just that's like it's hard to do you can't do that on Shain right so um given how much video has taken mind share and probably just screen time in the social sphere I doubt that like

that a social application that the traditional F the traditional social styled applications are going to drive um a lot of onchain activity you you can already see that with with foraster right they're really minimizing their onchain footprint um because you know you really can't do a lot of it onchain even in the high throughput system so um I was still I would still expect even in the social realm the things that drive onchain activi to look a lot more like defi than they do social yeah I think that's fair and I and I think maybe part of the thesis for you know social related things coming on chain um May simply come down to what look like defi activities like you're

saying in terms of transfers or payments um you know I think we see this in the live streaming space today obviously there's ad Revenue um related to video content but a lot of the kind of interactivity of live streams for example is driven by you know creators offering interesting ways like for their viewers their subscribers to like maybe directly interact with the stream by donating or like paying a little bit you know a dollar $5 $10 um maybe they'll get you know text to speech to kind of happen during the during the live stream Etc like different little games like this um I think you know there might be a an Avenue for kind of an onchain

offering of of this type of idea um you know friend Tech was an approach with like private text groups but you know if you can sort of ab abstract away that that tipping process um and you know maybe the live streams don't need to be on chain but if the Tipping and the other things and you know you can put betting and and tokens and other things related to you know these videos and live streams and other kind of um High fatality content that might be where you know users are willing to kind of get in on the action um you know the big like if you look at the business model of like something like a twitch you know they have bits which are you know a currency that you can use to kind of micro tip creators but they take I think anywhere from like 20 to 30% of that for

themselves of a cut um you could enable this on chain and and the cut could be far lower um to a business and the fees to like do that on like a salana or a s like pick your favorite cheap fast chain would be you know less than a penny um so there's an opportunity to do that at scale if you can just like maybe abstract away what it is like I think people in like gaming and I think you know normal people just interacting on socials I think crypto has still has a little bit of that negative taste in their mouth maybe but um you know if there's an easy way for them to like give $1 to their favorite content creator um they're probably up for it because they're probably already doing that today all right um well I think we are uh We've covered enough topics today any

other maybe big takeaways that we want to drop for folks before we close out today for the week bullish bullish barretts bearish price targets bid China bid Japan bid all markets I think study the ETFs that that's what I think right this is a long-term passive Flow game that I think most of crypto doesn't understand so I think I think when next year if we can get some higher numbers and we move past the regulatory uncertainty then we can maybe see what it's like for institutions to form more so yeah

study cash flows we're walking into October that's all I'll say all right this has been a great fep guys thanks for coming on and and thanks to all the listeners for tuning in appreciate it [Music]