Bridge's $1.1b Exit, Crypto's Voting Power, and a Token Unlock Playbook | Roundup

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the reason it hasn't worked is not because it's stable coins haven't worked or Stripes not smart enough there's a lot of inertia to getting a new thing done at a company and sometimes you have to make these really big bold like burn burn the boats type of moves as a Founder I feel like I don't want to touch something doesn't capture of does fundamental value I just I'm sorry but I don't feel comfortable owning it in size my portfolio scale is the blockchain that is Simply Built different other L1 networks have costly transaction fees clunky user experiences and lack true adoption in Ai and onchain gaming explore the gas-free ecosystem at scale.

space ecosystem and follow their Journey on X scale Network that is scale with AK hit the link in the show notes to get started hey everyone excited to share with you that Kronos ZK evm has launched its Pioneer program offering early adopters a chance to earn not only loyalty points but also potential win part of a $30,000 ZK cro giveaway if you're interested in being an early adopter visit zk.

kronos.com 10th to 11th in Bangkok Thailand organized by polygon Labs the a summit is bringing together top crypto Builders researchers and leaders to discuss the fragmented ecosystem of today and how aggregation can get the industry together head on over to A.D to book your tickets or join the mainstage live stream on the 11th of November hey everyone Jason here there's a reason why Ledger is trusted to secure more than 20% of the world's crypto assets today check out their newest devices The Ledger stacks and The Ledger Flex featuring the world's first secure touch screens take your security seriously hit the link in the show notes of today's episode to check out their latest

devices trust me you won't regret it what's up everyone how you doing uh welcome Santi what's up GM we're in the same city finally the New York trip love it love this city oh man should we zoom in on how do we uh look at that look at that cleanly shaven man everybody this is as as as as probably I did sh fully the my barber back in back home he just went at it bar went butcher mode yeah he he really butchered me anyways I don't know his butcher but he I mean clean shaving clean well I guess if you're

fundraising you need to it's like you know you come to New York you look like the New York Yankees tighten it up a little bit sorry for your loss Yesterday by the way folks you know was tough I'm a Red Sox fan so I'm oh are you me too yeah why are you because I went to school in Boston I literally live like I could see Fenway Park from my house nice nice nice nice um great Netflix show going on called The Comeback which is about the Red Sox Yankees and then the 2004 ALCS which were Red Sox were down three anyways um how's the fundraising trip you're here to fundraise well I'm here to run the marathon on Sunday um but I did uh I did get in earlier to just have a bunch of

meetings um and yes uh fundraising meeting potential hires um got office space yesterday so very exciting stuff let's go yeah yeah I I mean New York's such an important city I uh I think a lot of the a lot of the team's going to be based here most of the strategy is going to be based in the US just you know looking at Targets um so that's all ongoing it's just kind of paralyzing everything um so yeah incredibly busy but very exciting the marathon at this point is an afterthought to be honest yeah it's funny last year I feel like everybody was really into the marathon and like run like training very hard um like not just you a lot of my friends and even people at block works

like everyone's training really hard this year still the same amount of people running the marathon but nobody's taking it that seriously so I'm like what does that say about Society or where where people are at sir I mean n of 10 so the data the data sample is pretty uh small I was thinking about tweet about this I mean just if you have the opportunity to run the New York Marathon you should it's like the best I've done all the majors I've done God so many marathons but I I make a point to come here every year and run it because it's just amazing it the like Boston's great Tokyo Berlin London Chicago run a same SF I've run a bunch New York is just on a whole new level and I just love coming here because it's

greatest city in the world and the experience is UN unparalleled it's just unreal yeah yeah yeah any interesting fundraising meetings or probably can't talk about them yet can't talk about it but yeah I mean a lot of people have been reaching out so I appreciate that um a lot of my times just been spent focusing on just DD on potential targets and I'm just like my brain's there uh fundraising is like I'll have some meetings here and there but um it's a lot of the people that I've worked with in the past I feel most comfortable going with initially and it's very informal it's just you know conversations and you know of course people seem to like the strategy um but until I close the fund you know as I tell people I'm going to raise what

I want or I'm going to raise zero and I'm going to put my money to work and you know I'll live or die but I'm gonna do it Target Target goal of one billion yes cool or more I mean the strategy uncapped but I do think as a first fun it would be um as I've thought about it uh I I think that would be a uh sufficiently large fund to execute on the strategy and be dangerous yeah in in the good sense of the word so we we interviewed last night Zach uh who's the founder of bridge uh bridge. XYZ which just got acquired by stripe obviously for a billion dollars and uh we talked about the deal um it's the first public

appearance let's go lalom sponsor us baby we need baby this would be how many locks do you drink in a day these days don't ask questions you don't want answers to by the way also this would be LOM would be a reason to move back to New York so LOM if you are out there if Trump could use a sponsor yeah for sure actually we get roasted for having too many sponsors on the show but you know like one we um night we had Zack yeah we had Zack on the Pod it was um so so it's the first public appearance that he's done about the stripe acquisition so the deal hasn't actually closed it's with Lena KH con and The Regulators right now um but we talked about the acquisition but

I mean the show ended up basically turning into a pitch for inversion Capital it was really an amazing it you know it was I've heard your pitch obviously for it but it was amazing to have that in my head and then hear him outline the benefits that stable coins actually bring to the market and actually can bring to these Legacy companies and he walked us through a couple of examples and whether it's treasury management or payroll or I I think the most exciting thing that he talked about is like look we're we're kind of doing what happened with the internet and with the iPhone which is like you just apply it to these old use cases but like the new use cases the really crazy cool stuff hasn't even come yet um so anyways just a really good episode that'll be out on Tuesday folks

people should definitely it's one of the more invigorating kind of energizing conversations of course because I'm thinking of leaving like breathing this constantly um but I go back to like the the early days of like defi like stable coins are just the minute you use them people talk about it's a trojan horse it's a killer use case um it is just such a powerful um thing like if we just stopped innovating and that was that was it it was it's just an amazing use case uh anyone that's traveled anyone that has done crossborder payments anyone that has an company that does international like you know basically International really really appreciates that one of the things that sack said um that I really liked was how he described The Current financial system which is a

lot fintex including stripe or Square where he was at previously or bra some of these like you know fex that have he said they've innovated on the margin which is I took to mean you know the current Financial system is very Antiquated and you can only do so much like we've sort of like hit a a a limitation point at which like even stripe as I think about why they acquired um bridge is they sort of realize like you can only innovate so much with with with a with a patchwork of EX of antiquated systems the next level of growth the future is really you know operating in these permissionless ledgers and it's like from scratch right it's just and and stable quein really

are that and and I think that's why you know if you were you asked him some great questions around why would stripe acquire them versus Bill them they just launched 18 months ago like you know strip's a really good competent team they could have done this themselves but I I think stripe just sort of woke up one day and the cison brothers are incredibly Smart in this way and uh they've been talking about stable coins um and I think they just realized like it three years ago probably too early today they woke up and they they felt a sense of urgency because Bridge has gone so much traction so quickly and Sack was just describing how many of the you know developers were just innovating and and pushing them doing all these crazy use cases that uh I think stripe saw through that and and felt this kind of woke up

one day and said felt this sense of urgency and was like we need to get is now otherwise we're gonna we're going to you lose a very big competitive advantage that they have already so stripe has actually tried to do things with stable coins twice in the past and both times it hasn't worked out and the reason from my understanding and talking to friends at stripe and stuff like that the reason it hasn't worked is not because it's stable coins haven't worked or stripe's not smart enough there's a lot of inertia to getting a new thing done at a company and sometimes you have to make these really big bold like you know burn burn the boats type of moves as a Founder I feel like and this to me was the cison brothers doing that they said you know ever talking about how

they overpaid and stuff like that first off I I don't think they overpaid um I I think this is like an Instagram meta acquisition where in the future will look back and this was incredibly cheap but I think the big reason why they did it was because I I I heard the way that the deal went was there was a deal team and they had the DCF and they're building these models and Patrick said [ __ ] your models we're paying a billion dollars for this company or whatever the real amount was 700 million or 1.1 whatever the we're paying a large amount that nobody on the m&a team thinks makes sense we're getting this deal done I've got voting shares push this thing through and uh you know for him I mean that's just rumors of of what I kind of heard but for him to do something like

that the reason I think that he did it is to plant their flag in stable coins you get this huge press release big announcement stripe is here to play in the a coin space and I think it's a I think it's a brilliant acquisition I think it's Bridge has these lowlevel apis right they Zach talked about this on the on the episode but they haven't really created apis for one use case uh they've done it's the exact same way that Patrick and John talk about their their business and yeah I just like it a lot so yeah a lot of what I to your point around on nura I've been spending a lot of time talking to kind of the implementation partners that the tech stack that a lot of which I've invested in but also um that I'm going to implement you know the first 100 days

kind of Playbook and it's just really interesting to hear and go deeper into why we haven't seen as much of of of an adoption makes you wonder was the timing off is a tech not ready is is there just where where is this like lack of appetite to because we know clearly works it's just wi and one of the things that I've heard kind of over and over is most businesses especially doing B2B B2B or to see is this idea that uh Merchants are very sensitive and unwilling to risk um they'd rather pay four or five% even more to than add any amount of friction into the checkout process into

the equation right but I guess the the point that I'm trying to make here is why now because there have been very you know the last year I'd say very important innovations that have facilitator and just made the uiux incredibly seamless that I would challenge people and say and go as far as to say if you look at Blackbird for instance and their pay flow it's just actually on par or easier than traditional uh payment methods if you are using PayPal and a lot of that's account abstraction gasless transaction batching all these things really do matter and I don't think we could have you know I don't think three years ago uh it was very different experience is what I'm trying to say and a lot of

times crypto people you know people don't come back uh people don't revisit the thesis people don't you know or sort of have this idea of what crypto is and you just have to you know keep hacking away and just um you know I do think that when stripe with the muscle and the distribution of stripe just totally different game because sack was describing this friction right um so was be incredibly uh exting to see how that plays out very much so um all right few other few news stories I wanted to get to in this Roundup so one was uh coinbase coinbase had earnings um and the market reacted pretty poorly and I want to make the argument that that was just a really

overblown reaction um I I I very much disagree with it um Celestia unlocks happened this week and it was one of the biggest unlocks in the space in a couple years and so I think just the Celestia unlock is less interesting but more interesting to talk about these you know what was the market reaction how will the market react to to other unlocks there was a big poly uh the market thought it was a big poly Market story I think it's a total nothing Burger of a story but there was a wash trading story um about po market and then there were actually a couple layoffs this week so maybe we can start with the layoffs so this week um uh dydx consensus and Kraken all publicly announced layoffs there are a couple other uh more quietly announced quietly done layoffs that have

not been publicly announced yet but uh dydx CEO Antonio Giuliano said that 35% of the team was let go consensus CEO Joe Luben said consensus had cut 20% of the staff that is uh60 positions at consensus that is uh let's see for dydx I think it's about I think they had probably 50 folks I think that's about 10 people and then uh Kraken also had layoffs so Kraken announced a new co-ceo um uh what is his name again uh Argent sey uh he was at tribe Capital I'm pretty sure before I think he's also one of the largest independent

shareholders of Kraken I think don't quote me on that um and uh yeah they cracken head layoffs as well so uh laid off you know somewhere between 15 and 20% of of the company so this is interesting right because it gets to this idea of are we in a bull market are we in a bare Market uh David and I were David hoffen and I were debating on stage at permission he said we're in a bare Market I said there's no possible way we're in a bare Market Bitcoin Bitcoin hit alltime high this week Bitcoin hit alltime highs it's just that eth is not moving I'm sorry David uh so it kind of gets to this question I think that this is um this is interesting for two reasons one

is uh actually really really one one one thing first off I don't think we're in a bare Market I think we're in a bull market bitcoin's about to hit an all-time high uh other things are hitting all-time highs you're just seeing a bigger dis dispersion than we've ever seen in the industry between things that go up and things that go down the really interesting thing was actually one line that Joe Lubin said and then Antonio said a very similar thing so uh he put a little bit of blame on the SEC he said look with the government coming down on us such attacks this is a quote such attacks from the US government will end up costing many companies that have been investigated suit or sent Wells notices many millions of dollars but there was an interesting line here that I'm starting to see in

telegram chats with Founders and group chats that I'm in with different Founders this is a quote from Joe lubben he said looking ahead I see a Next Generation not dominated by large monolithic companies instead smaller agile AI supercharged companies with web three based coordination tools will operate more efficiently to stay competitive in this fast growing space we need to reshape ourselves and be more agile more effective and even higher performing it's very related to something that Antonio talked about if anyone listened to the dydx episode and he posted in his blog post about this he said dydx is moving to a model that has flat hierarchy less meetings no management

structure and actually Zach brought it up on the bridge podcast too he said look we've got about 50 employees today we have zero managers we have zero management at the company it's a very different way of uh of of building a company and it's I mean the thing that kind of took the Internet by storm at least in the tech World probably six weeks ago or four weeks ago was was this you know founder mode right Paul Graham wrote about it but really it came from Brian chesky and so I just think that this uh I mean it's something that is quietly behind the scenes being talked about in every single founder group chat I'm in because people are building their hiring strategies for next year right they're talking about you know people owe their budgets to the board they owe hiring

strategies to the team people are doing their Financial reviews and people are wondering how many uh what really is the benefit to just layering on more and more and more people at these companies instead of staying really agile and just saying how can we get more efficient more efficient more efficient so um yeah I'm curious if you have any thoughts on this oh this well put I think I'll just add Gary tan who is the president of Y commentator had a few interesting tweets that I saw a couple weeks ago which talked about the cohort uh the new cohort uh the batch of Y combinator and how they were really just even leaner and meaner because they were leveraging a lot of tools like particularly AI that allow them to just not hire as many

people there was also a a tweet I don't know how L as much Crea to it or not but I found it interesting which is a lot of these companies are building a lot of these Solutions in house uh using AI tools and ripping and kind of replacing existing s Solutions I don't know how much of that is true it's something that is worthy just to pay attention to um you know I think about it a lot as well in terms of these Transformations like how much can you replace your CRM your workforce management uh you know these These are large companies that you know historically have been very much embedded into pretty much every organization the penetration rate is still quite low a lot of businesses

particularly medium siiz don't really adopt technology and especially familyowned businesses but now you can do a lot with just build a lot these Solutions in house with like you know a lot of stuff that's open source right so I don't have as much of a kind of really good assump like view into how how real or how how much of that's actually happening in practice but it's definitely interesting um you know it's kind of like the McKenzie reports that everyone's talked about or these Consultants that say Hey look it's going to be a massive transformation in label labor market over the next you know decade with AI right so maybe that's part of that 100% 100% I also think Antonio like I also think about like um

what musk did at Twitter like he went in just fired like a a lot of the organization and you know it's like Twitter still works it's actually a better product so it's like how much of these companies are actually bloated just because most companies I just think are bloated or you know and so you go in there and just I think Antonio that's probably what he saw right taking M Playbook yeah yeah yeah it's just going to I mean it's going to be really interesting to see what ends up happening as these I think as I I I think this strategy will end up mostly working um Mo mostly working I would say um and the I'm not sure it's I'm not sure it's going to be

the consensuses of the world who lay off 20% of their people and still have a thousand employees and it makes them much better because it's like there's a lot of again like the stripe example there's a lot of inside of these companies uh what I'm really excited to see is the the new Founders who come in and build these companies and just don't end up hiring people they just get better and better and better at using AI so yeah absolutely yeah um yeah I don't know something we're I'm we're thinking a lot about it at block works right because we we create so much content so it's like what is what what is the role of AI there so I don't know um all right coinbase earnings yes did you take a look uh of course last last night yeah

um all right coinbase announced earnings let me see if I can pull up a little summary tweet here um they buyback but yeah go for it this is a good yeah so Ryan RM who's head of research at bitwise just put out a good summary tweet um coinbase Q3 2024 earnings all right Revenue came in at 1.2 billion this is down 177% versus Q2 net income of 75 million which is up over 100% ver last quarter adjusted eida 449 million down 25% cash is up to 8.2 billion which is up 5% um I don't think it shows it in here but about 25% of their balance sheet is now in I think it's 25% of their cash is now in crypto uh not not

in Fiat uh they they uh did a they authorized a billion share repurchase uh base transactions are up 55% versus Q2 um and then front and center in this you know PDF and this image that they always release they're now 1.8 million people uh St Advocates of stand withth crypto the market didn't like it um they didn't like seeing uh you know here I can just pull up the yeah the Stock's at 2011 Market just open now but it was down 5% after earnings um the news story is coinbase shares fall as muted crypto trading leads to third quarter Miss coinbase stock falls on earnings Miss coinbase Revenue may be hurt by trading volumes and

regulation uh coinbase stock Dives on earning Miss um so that was the analyst that was the streets reaction yeah I I saw one of the JP Morgan analysts updated his model last week ahead of earnings and like the price C was like 191 the stocks at 200 now it's up 16% year to date um yeah it's sort of A Tale of Two Cities right it's always interesting how the market response to this and uh you know um but but I I do think think that yeah I mean the share buyback is pretty encouraging I'd say yeah what are your do you have General thought I mean I know long term thesis on coinbase but any any updated thoughts on this on the particular earnings report Co yeah on earnings or like

current on coin base can we quickly just zoom into the earnings call uh around what was the commentary on Bas because Bas has been seeing incredible amount of growth and we can maybe link some of the stats but usage is up um I think Revenue probably sequencing revenue is also uh gone up substantially I mean it's becoming a non-trivial component of their uh of their p&l um and earnings I'd say so let's just look at that for a minute and also in while you do that I'm going to try to look at what was the commentary from the management team on it yeah so I just pulled up our dashboard on base I mean you can see transaction count you can see addresses you can you can look at their financials I mean let's see the key numbers that they put out for base was

2.5 billion in tvl two time uh 2x the growth on new contracts deployed quarter over quarter up 55% increase uh in base transactions quarter over quarter I don't know if they put the revenue in there other transaction Revenue was 34 million in Q3 down 35% quarter over quarter primarily driven by lower base sequencer fee Revenue the number of transactions on base increased 55% quarter over quarter as users and developers took advantage of lower fees medium fees in Q3 were less than 01 um so that's a scent we believe that more developers would choose to build their products on base as the cost to transact becomes lower this quarter we

saw developer engagement continue to increase and the number of new contracts deployed more than doubled from Q2 so that was their commentary on base subscription revenues which is something that is also interesting it's been going uh you know becoming a non-trivial component as well that was uh came in at 500 56 million down 7% quarter over quarter they were pleased with the result te though was slightly down um what else uh stable coin Revenue which is also pretty substantial 247 million up 3% quarter quarter this is something that we you know would be interesting to see we've talked about extensively during the Pod you know every exchange is going to launch uh stable coin every perhaps application

you know even in the episode with sack yesterday is going to launch a stable coin what does that do to usdc and they and the stable coin revenue for coinbase right um they talk about here primarily so so stable coin Revenue 247 million up 3% the primary drivers of growth were higher average usdc on platform balances that's interesting uh grew That Grew 7% quarter quarter of 6.6 billion in stable coin balances on the platform so you know potentially that money flows into crypto uh you know as more risk on appetite post election kind of thing be interesting to track how that 6.6 evolves over time higher average usdc market cap grew 5% quarter over quarter that's also

interesting um those drivers were partially offset by lower effective interest rate so that makes sense they rate Cuts so um we understand that um so at the end of Q3 they had 8.1 billion in on platform usdc balances that is 8.1 billion on the platform that's pretty good uh usdc market cap reached 36 billion the highest total since early 2023 year to date USC has been the fastest growing major USD stablecoin or platform incentives combined with deeper integration of UTC across our products has been contributors to both market cap and on platform balance growth all right can I give you my take

on all this aunti I think everybody this yeah oh yeah yeah go go ahead no do it I'm going to read through it and just give the skinny to people but please give us your take I mean I think everybody's mid curving the hell out of this everybody this whole coinbase earnings call is overblown the people don't trade in the summer people don't you people don't trade in the summer and uh people I mean people don't trade when the Market's just in this like consolidating period so you combine the summer with like this kind of crypto choppiness um they they ALS coinbase also hasn't had many memes on the platform like this is uh this this is just a really overblown earnings call I think Q I think I think

next year coinbase is going to have a monster year um when you think about like where coinbase sits in relation to the entire Market I mean if you're bullish crypto you got to be bullish coinbase right now um it feels what's the market cap market cap is 50ish I want to say yeah okay it's sitting exactly yeah it's at 51 today yeah you're looking at 50 billion market cap for the best public company and the fastest they're two two of the fastest growing Industries in the world it's Ai and crypto and coinbase is the leading company it just I mean I'm bu I own coinbase on bias but like it just feels

extremely cheap and then I mean congrats to Jesse and the whole base team like they had insane growth um easily the I'd call them the the winning L2 of of the year so far um yeah I just think I just think they've had like I don't know feels feels like a very mid curve take to be selling coinbase right here I the Market's always played a short-term game uh couple more interesting sing points from the earnings call stable coin volume this is usdc and all combined uh reached 22 trillion year-to date more than doubling year-over-year okay um we talked about usdc market cap also growing 11% fastest growing USD stable coin another interesting thing

obviously coinbase rolled out CB BTC that will also be interesting to track as more activity in the Bitcoin Network particularly in Defi and other onchain applications grows there's a whole host of L2 slide chains that are you know picking up steam from Babylon to Arch and a few others we found in the Pod um also probably capitalizing on uh wbc's just kind of what I would call fumble uh your point around Bas is correct Bas is now the number one L2 in both transactions in total uh That Grew 55% quarter per quarter surpassing all other l2s and four times higher than ethereum that's the all want over the last 30 days yeah I agree with you I mean ultimately I think people are

just koi and waiting for the election result and litigation is ongoing the you know you I mean like so that that continues to be a sticking point but encouragingly you know J the the the the analysts keep it at neutral and I think this tells you the market sentiment towards crypto maybe this a good transition into ETF flows because that's also been uh something people been paying attention there was a lot of ETF flows yesterday it's A Tale of Two Cities right you have Bitcoin having record inflows ethereum basically getting zero so uh there's also filings by Cayman capital and a few other folks I mean on the salana ETF uh bitwise I think in great uh believe it was bitwise continues to have um you know just

changes to their registrations on other ETF products like with ripple and a few others like this is over the last couple weeks that I've just observed so yeah um we'll see the all on the on the election I don't think the market both with coinbase and just generally is going to do much there might be some B but I think people just on the sidelines like yeah consciously waiting by the way I mean great point on the ETFs if people missed this black Rock's Bitcoin ETF had its largest ever inflow day in history yesterday 875 million in a single day uh which means the Bitcoin ETFs took in more over the past two days Tuesday and Wednesday than the gold ETF took in during its entire first year

so yeah just tough not to be excited about this going into the election um the micro strategy announced uh also some purchases yeah they announ uh oh God what was it I think sailor announced plans to buy 42 billion worth of bitcoin over the next three years um for context 42 billion is a double the amount that all of the ETFs have brought in so far since launch um let me fact check myself on that yeah raising 42 billion to buy yeah more Bitcoin um so yeah 42 billion over the next three years JP Morgan update on the coin very timely thank you uh Kenneth uh worington who

was the analyst over there they kept their price Target the same Kenneth Worthington yeah Kenneth Worthington that is just a a Chad analyst name if I've ever heard it the the their uh their summary was Q3 2024 results fall short of expectations but coin continues to execute on its longer term plan potentially more friendly regulatory environment on the horizon that would be nice scale is the blockchain that is Simply Built different let's face it other L1 networks have costly transaction fees that increases the network gets busier scale has solved this problem with a gas-free scalable infrastructure where users never pay gas

fees scale was awarded the most active gaming chain in 2023 by coin Gecko and hosts five of the top 25 games on dap radar you should definitely check out scale I was using it the other day it really is incredible to use that's scale spelled with a K hit the link in the show notes or head on over to scale dospace ecosystem to get started today hey everyone Jason here I wanted to quickly talk about Kronos ZK evm a Next Generation zero knowledge layer 2 blockchain Network focused on scalability security and Innovation secured by ethereum it further expands the Kronos ecosystem using ZK sync Tech Kronos ZK evm has launched its Pioneer

program offering early users loyalty points for engaging with Kronos zkm and its daps join the first Quest by depositing cro in the Chronos ZK evm bridge to receive ZK cro and loyalty points at Main net launch and that's not all in addition to receiving ZK cro and loyalty points you could also win part of a $330,000 ZK cro giveaway by depositing in the bridge the more you deposit the better your chances of winning visit zkm drron org bridge for more info now let's get back to Today's Show hey everyone Jason here just wanted to remind you about the aggregation Summit going down this uh November 10th to 11th

in Bangkok Thailand this is a can't miss 2day event with some of crypto's top Builders researchers and leaders discussing the fragmented ecosystem of today and how aggregation can bring the industry together a summit was designed by polygon labs to be a space where ideas are discussed in collaborative creative formats from spicy Fireside Chats to even game shows you get to experience a wider array of events at this year's inaugural a summit head on over to A.D to book your tickets or join the mainstage live stream on the 11th of November earlier in today's episode I mentioned Ledger's latest products the stacks and flex and I wanted to take a

few seconds to tell you more about them these wallets feature the world's first secure touch screens which don't just simplify your digital transactions but also keep them extremely safe these wallets are virtually impenetrable to online attacks because they store your private key in a secure offline chip you can manage more than 5,500 tokens and install up to 100 apps choose the most trusted name in Hardware wallets and take control of your digital Security today at ledger.com or hit the link in the description of today's episode to check out their latest wallets let's talk election because I feel like we've done a pretty good job of not talking about the election so far

um on the up but there's a there's a uh so here first let's p po poly Market let's see where the the odds are sitting all right uh 66 for Trump last check commot 30 something 33 65 verse 35 um far so uh Fortune did a big piece um who is the Leo Schwarz at Fortune wrote this exclusive election betting site uh polym Market gives Trump a 67% chance of winning but is rif with fake wash trading researchers say the researchers in this case were chaos Labs um who I

know you're an investor in uh they they run by Omar they do great work um and then uh Inca digital so chaos uh I'll read a snippet of this uh chaos Labs uh separate analysis by both firms said uh said that there was a false impression of volume in activity chaos Labs found that wash trading constituted around one-third of the trading volume on poly Market's presidential Market while Inca digital found that a significant portion of the volume on the market could be attributed to potential wash trading um what are your thoughts on this on this report on this thing well cave had and preface that I'm both an investor in

chaos labs and I led one of the earliest rounds in poly market and paries one of if not the largest holder of poly market and I have vested interest in both so that is bias and disclosures out of the way there's two two arguments one is people in crypto are more inclined and kind of are expressing their views not rationally but just their desire so to speak for Trump to win he's you know but the other counterargument to that is well but they're also rational investors like they're not going to lose money and there's an Arbitrage potential opportunity of you know the markets off right so I'm not I'm not really sure how to explain it like there is a big Delta uh between these markets um you would think that there shouldn't and

this Delta As I understood it like it was very tight tightly correlated like the spread between predicted Robin Hood some of the others and and employ Market was not far off but it has just recently really blown out of proportion first of I Love the That reporters are starting to work more with like the chaos lab is and these data providers I think that's a really cool thing I really didn't like the framing of this article um because the title says poly Market gives Trump a 67% chance of winning so it's about these odds but is Rife with fake wash trading so what you're doing there is you're saying the wash trading is making the odds skewed and uh there's a really but that that's not actually how wash

trading works wash trading shouldn't impact prices very much right wash trading can create false Market perceptions like the volumes can be wrong um but that doesn't necessarily mean price manipulation so I think I I just yeah I don't like saying that wa this is the title implies that wash trading has created price manipulation leading to Trump having this 67% chance of winning on poly Market um it later in the article down the article the author acknowledges that you know that that's not how trading works it doesn't actually change the usually doesn't tra uh manipulate the price or the odds here um but again like I I don't think

anyone's reading this article it's behind the pay wall you have to pay for Fort like no nobody read this article so they just see the headline a lot of these are woke uh you know Publications so New York Times Fortune they all skew you know Democrat I believe um I like the I like the premise of doing investigative Journal I like I I mean I will always someone doing investigative journalism and it's a really hard business model and we're we're in that we're in the same business right but like I just really don't like trying to discredit something like this on a false premise um and what's here I'll what's actually happening is here's what's actually happening poly markets definitely are probably I know nothing I'm sure you know something and can't

say say but like poly Market will probably launch a token and just like anything that is going to launch a token there's all these farmers who come in and the there's no fees on poly market so what do you do when there's no fees in a future token coming you you you wash volume right just like you would on any uh decks or crypto exchange or whatever you just wash a bunch of volume to rack up user activity to then get a token so that's what's happening here it's not what they're quietly doing is implying that there's like fake volume coming in to move the odds that is not what's happening there's just airdrop Farmers coming in and washing a bunch of volume yeah so so Omar uh he's

supposed to join he'll join next week but I'm reading his twet thread right there's a couple of observations that he makes that I think are just worthy to present without commentary um so their the Trump yes tokens have traded 1 cent to 10 cents higher in poly Market than similar tokens on Ki a us only prediction Market uh that recently received regulatory approval so it's really August 17th that this this spread really blew out um he posted this six days ago by the way if you want to show it on the screen there it there it is that one uh than yeah that one so what the data shows according to them um a single person on August 17th bet across four distinct accounts Fred you know in

poly market and became began accumulating a massive Trump yes stake uh that day this particular Traders activity over these four accounts accounted for 28% of the Market's total volume in poly Market he purchased a roughly 700k of trump yes n shares um there was also a piece on the New York Times talked about this so this single four Trader cluster accounted for 28% of the poly markets activity uh and that that's one that's one Traders behind all four of those one Trader is I think he's French one Trader accounted for you know 28% so um it really

was four of these days were concentrated around mid August so when po markets imply Trump odds begun diverging significantly from the polling base consensus um so of course this moves the market in poly Market we know that um so poly Market's current 1-cent market depth uh that is the size of an order needed to move the market price by 110 is currently around 100K I think that's interesting so it's a it's a large Market but the market def is particularly you know in this case he's making the arguments not as as kind of robust um so and it was quite shallow in August okay um this particular Trader since August has bought or sold more

than 100K size with a single transaction on 60 different occasions he Al mentioned that again and again Omar W you're repeating yourself making a fool here um so what's the Gap he this is a tldr um the impact of the whale Trader Omar argues cannot be understated if one entity represents 25% of the total market and at times 20% of the daily volume it will have an outside influence and he all further you know the IL liquidity of these markets uh you know can move the price um however you know this is probably the most important point he says there's it's there's no trivial way to Arbitrage

this spread which is the point I made earlier um under ki's current fee structure price takers in the election Market pay a fee of two cents per transaction so that potentially is a um you know gets in the way of arbitraging this and furthermore poly Market is only available in theory to non- us users where Ki is only available in theory and practice to to us users so that might account for the kind of the abil the the I guess get in the way of like arbitraging this out um and then last Matt LaVine also wrote about this uh any wouldbe arbitrager runs the added risk of an

adverse Market resolution if a candidate disputes the election result and that is probably the most important so in summary and I don't know how much of this explains it because your pointer on was trading doesn't explain the difference the difference of the spread might be just the particular preference we user non US versus us and if the spreads that wide between these markets in theory in an efficient market that should be arbitraged out but because of this two things one US users versus non- US users different people can't access the platform the fees to come in and out of this are mitigators and the third risk of I think before in the prior election poly Market had a issue because obviously the election

result was contested and the resolution of that market um was um was controversial and so if you want to Arbitrage these markets you might you might not it makes you think twice is what I'm trying to say so I don't think your point is a really good one was trading doesn't explain the the the spread the the the lack of being able to Arbitrage that spread for these three reasons I just outline that Omar and Matt line talk about would explain the spread it's a material spread so anyways um I don't that's really it I don't have a point of view here cool by next Roundup they'll be a president so we'll

see uh gonna be a crazy week have you voted have you voted no I still haven't voted yet why not because I'm lazy God damn go and vote so you are um what I consider pretty politically well versed and I we don't like to talk about politics in the podcast uh give me your two to three or longer view on the election just summarize it all for people that are you know been living under a rock what are you paying attention to what are what do you think the results G be just give all I'm putting no I have NOA I think it's

uh crypto people pay really close attention to poly market like where we just spent 15 minutes on a podcast talking about it the 65% Trump versus 35% KLA makes it feel like Trump is obviously going to win I think it's going to be ridiculously close and then what's going to happen is like I think it's literally a tossup and then I think what ends up happening is I mean both both sides are already prepping for a allout war to contest the election so this thing's not like it's I think there's an idea that the market is waiting for the election to calm down uh and to get some certainty and then things rip and I think we I don't think that could happen I don't think that'll

happen until maybe January maybe even into into February because November and December it's there could be even more uncertainty then than there is today um I don't know if it'll be that drastic but like I think it's going to be we we we'll never see we've never seen a a contested election like we have seen for than we will see for this one so that's the first thing that I think I'm kind of prepping for mentally that I don't think people are thinking too much about um and I think I mean I know both both sides are going to do that right if commo wins Trump's team they're their Republicans are doing an allout War contesting the election and same vice versa um so that's gonna I mean that's going to get pretty messy and I think

that won't bring the market certainty that people are expecting that's um that's that's one thing on the on the like next cple days I mean it's basically just people have mostly made up their minds I mean there's very few undecided voters anymore now the important thing is getting people to the polls for both sides so if including yourself and getting me to the polls no I'll vote I I always I always vote um you don't strike me as an on voter I always vote [Music] um the interesting thing about the is there's two extremely different campaign teams so you usually in politics you have like basically a carbon copy of the operation and the team on both sides

just one is you know red and one is blue it's like blue team versus red team right now Trump Trump's team if you look at the campaign team is extremely different than Kos team oh yeah like in their operations and who they've hired and I mean he's trolling he's like a a garbage truck because like Biden call him garbage like right so Trump strategy right now is like you know yeah McDonald the garbage truck stuff these huge rallies and I think there's actually probably more people who are interested I mean there's a lot he's done a great job of getting people interested he doesn't really have the ground game that Harris's campaign has like like Harris and in the key States like they are on the

ground they know they they are they have years of experience of how to get people to the polls I will say so it'll be interesting to see if like yes Trump has gotten a lot of people very interested in Trump can he actually like you can have a 22y old or you know or an 80-year-old who loves Trump but doesn't get off their ass to go vote so it's really important that both sides right now are getting people their people to the polls not just hey I'm a trump guy or hey I'm a I'm a com guy well if you listen to um Elon musk's uh Speech uh at the the ra Trump rally in New York Madison Square Garden which is super electric I saw some some clips he his point was go vote like get out and vote

and vote early um and let this be a landslide result um so I think like the the weight and gravitas of musk I think is very important how to your point how how much of that translates into people getting to vote it is just a to your point around friction and inertia it is just a game to get people to vote Trump trumps Trump is tweeting at mer I mean never thought I'd see that M congrats he I think raoed Trump too pretty pretty amazing look I mean we talked about this before um uh the swing States historically been tight like less than

100,000 uh 150,000 like difference in these uh in the outcome best believe that there are at least 100,000 people in some of these states that love crypto and and you know imagine the headline that would be probably the most bullish headline for this industry imagine the outcome of the result comes down to swing States very tight margin 100K voters and these voters most of them are pro crypto and they just identified more with Trump because he's just been very clear and pro crypto and if imagine the headline like Trump wins key key constituent base the crypto uh both pack from a fundraising standpoint but also more importantly younger voters

like Obama won the won the younger crowd won the Immigrant crowd back in the day right and that was the headline so younger people you know he really did that grassroot campaign his I think that was probably Pro the Democrats you point to better job that but imagine if this election is won because of the crypto voter that I think unequivocally just places crypto it sets a im immense precedent of how important crypto is that has captured the guys of a generation it sets I mean that that would be yeah that would be pretty amazing if you ask me if you ask me too bad you can't vote um well you know I

will say I'm wearing um I am in the US I don't know if people can see but I'm wearing a American flag baby can you see it yeah I can see it I wanted to be in the US not just for the marathon but I want to be here uh I think it's going to be historic election and yeah I'm really excited about it nice nice um there's a trash article in the Atlantic I'll show you Shocker the Atlantic posted the worst of cryptos yet to come and made the argument that the only reason that crypto has come back over the last two years is not because anyone built their way out of a bare Market with All Odds

stack against us but because we've spent a lot of money on super packs and it's just oh like this I mean it's just you know more reasons I don't know why this stuff still bothers me I'm like what a stupid article well I cancel my subscription to the Atlantic a couple years ago needless to say there you go um all right last thing I want to talk about is the Celestia unlocks so um their big Celestia unlocks yesterday or Tuesday um there was about a billion oh man I think I'm going to get this right yeah has 180 million Tia hit the market which is roughly uh you know nine at the time was

like 900 million um so celesti was hovering above fiveish or five bucks so that's yeah no higher six was that six a week ago yeah six so it's down about 25% um yeah down so anyways huge unlock about a billion dollars of Tia unlocked um represents about % of the current Supply got unlocked this week uh funding rates on TIA were crazy negative in the past like couple weeks um and I mean it's actually positive today if you look at coin glass I guess that's what VC is closing out their per shorts as they as they unlock them um but yeah I'm just curious how you like when you look at this big of an unlock

hitting the market Tia is down from six down to 470 um to me I'm like this is kind of what I've been talking about for a little while which is I think some of these unlocks are overblown um like that yes that's down you know 20% 25% but like it feels a little uh it feels like the market absorbed it better than people thought it was going to absorb it uh but I'm curious how you although I guess maybe the counter argument is this is this is the real chart it's really down from yeah I mean look yeah it's done quite a bit down from 20 down to 470 there uh I

think they did some one of the things that I was tracking was secondary Market activity and transactions for TI there was some a lot of movement there over the last six months there were some I think treasury transa there were some like treasury diversification transactions at higher than the current spot and even before the unlock like six bucks I think there was there was some movement there which likely you know to your point on it wasn't as bad as you would have thought I think a lot of it is just secondary Market um healthy secondary Market allowed for some some this orderly trans transactions before the unlock to you know and I think you know these Shares are not potentially VCS that are

weighing the money of D RIS and so that creates um a more orderly unlock I'd say it's still down quite a bit arbitrum had this you know we'll see I think it's trly to tell I wouldn't be shocked if this goes down to three bucks I would also you know because of people continue to sell and you know there's this idea of like all right I'm not going to sell maybe in the first week but I'm just going to continue to drip out and this is constant sell pressure I don't know you could also argue that the market just been soft for you know a lot of these projects it's it's really much a Bitcoin salana meme game ether flat and also you know you could talk about specific idiosyncratic things about Celestia right you know it's uh you could look at like a revenue is not much

so is this you know do the do these things straight on fundamentals or not and I mean certainly I think though that that's something that I'm observing you know like what's the da Revenue like yeah I understand the modularity thesis it's important we've talked about it we've had Nick white on the podcast we've talked we've talked about it the question is yeah block like go up to that you look at your dashboard which is really good here total blob fees are 51,000 like you know there's a mass amount of data it's important there not Revenue so it makes you qu wonder what's the viability of this project at some point fundamentals I believe is do matter and you compare that against maker vastly different story so Le is trading at higher Val no let me take the

counterargument counter argument is that uh all right so if you look at the the blockworks research Celestia dashboard you can see Celestia data posted to the blobs by names space so you can see like things like you know Manta and lra and eclipse and B3 and things like that I mean that chart is up and to the right basic here's the I think bull case for Celestia the market still doesn't trade on fundamentals no one's valuing this thing on a cash flow basis or a you know a multiple of Revenue Uh there's Big volatility in the short term because there's these obviously unlocks the bull case is probably uh blob space demand is on fire it's on the rise l2s are launching you know every day it feels like modular stack is expanding and celesti is basically positioning

themselves as the go-to da layer go it's a go to DL but but there's no there's no value capture okay but like if you're SEL compare that compare that to gto's revenue man like put pull up jito's [ __ ] Revenue record like you know I mean like again like maybe it's not the right comparison but like I definitely you know I mean like salana just continues to post and capture a lot of this me and transaction fees and tips like I don't know like I never want to invest in some look none of this investment advice but you ask me I don't want to touch something doesn't capture does fundamental value I just I'm sorry but I don't feel comfortable owning it in size my portfolio Chris if you're listening from placeholder I know

he has Uber bullish Celestia uh and there's others that are not we can have a pod I think it' be a great discussion I do want to fundamentally understand why this thing is worth how much how many billi let's get uh let's get we should do a pod with Nick and Chris all right well let's do just napkin math spare me a minute I'm going to pull up ftvs for these projects and I know people are going to say why are you looking at FTV well sorry folks that's just on my brain thing so if you don't like it close down the tab now and stop listening jto here I've got I've got it right here market cap 300 million FTV 2.3 billion okay 2.3 billion Celestia FTV five billion all right over

a 2x discrepancy in fully diluted valve to be fair Celestia has 30% of float jeto has less jeto has 133% float okay all right fair point but still 2x differ but you mean 2x difference and fully diluted J's making vastly more money than celest I get that I I get that lastly no I okay I'll stop talking maker no you got me this is lockum coffee by the way ladies and gentlemen locked in maker maker billion dollar in market cap Vance from framework if you're listening

you should come on and talk about maker fully diluted Val 1.1 billion 97% float all right maker is making how much money here financials monthly last month 230 million well like maker makes in a day what Celestia makes in a year so to speak kind of thing or more like I don't know ladies and gentlemen but I never want to own something in my book that has that is trading at five billion and is making less money than um you know I don't know all right let me take the let me just take the counter and then we'll have uh we'll wrap this up and we'll have Nick and Chris to give us

the the Uber bull case for Celestia which is uh Celestia is the go-to da layer right now uh token's been whacked because of these unlocks the unlocks just happened uh l2s are launching every single day blob space demand is on the rise eth blobs are just starting to see like early price Discovery um the blobs are probably going to get more and more expensive as more l2s come online and if I am Celestia I'm thinking about you've got your kind of modular stack you got to eventually expand outside of just da and give people the ability to launch like yeah to kind of compete with the op stack and antias and you know Avalanche l1s and ZK elastic chains and arbitrum

orbits of the world so that's probably where I would guess Celestia goes so Celestia announces maybe that they are competing with the op stack like I don't know that's that's the counter sounds uh sounds a lot like I need to believe many things to happen and basically price to [ __ ] Perfection I don't man I don't need to believe many things uh for Salon activity to continue to m perform and it being the most you know friendly chain and integrated and you know I mean like sounds like a Jenga Tower of assumptions you know celesa has to do this and then maybe maybe maybe they'll do please come on Great Tech again there could be great Tech but the valley creu

may not be there there's plenty of examples of that now maybe in the future certainly possible if it's great Tech it's embedded they have the possibility to then you know you know capture more value in different ways you know a lot of companies like uber had this issue and I'm cognizant of that and it takes years to turn a profit it's a good product eventually you have the optionality if you're really embedded if every L2 is using you then presumably you can you're in a position of strength and you can lean into that to make more money but currently it's not making money for that reason I would be cautious that's all I'm saying uh all right last thing on this note and then I have one more thing to share is uh our friend Simon over at moonrock

Capital posted this note on scroll so I know you're an investor in scroll so I don't know how much you can talk about it but Simon said I really don't want to hate on scroll but to me it was a textbook example of a launch using an outdated Playbook that doesn't work anymore VC rais it an inflated valuation pointless airdrop farming meta and the worst is binance listing for five and a half% of the supply that's about 70 million at least flush down the toilet sex's are the only winner again investor pissed Community pissed retail wrecked um the the one thing that they didn't focus on was the only real Northstar metric an ecosystem should have actual apps on top that people genuinely want to use creating lasting value it's unfortunate but it was all too predictable that this approach would

backfire uh I don't need you to comment on scroll because I know you're an investor there but I would I would challenge the last point though that the only real Northstar his point that they weren't focused on that I would completely like challenge I think Simon go and talk to the scroll team I think you'd be generally surprised uh of the quality the builders there I think they're um they've done a very proactive effort unless playing the point meta game I'll just say that the binance 5% fee we talked about yeah I think my point my opinion on that is fairly clear and it's just a I don't think it's a srel problem it's an industry problem right I mean the fact that they have to give five and a half perent the supp binance is just hosing people right now but it's by the way like I don't have a

sense of like this 5% is it fair or not but s had a post about that and she explained the reasoning but I mean it's yeah so it's not scroll it's not a scroll thing it's a everyone is being forced to give between like two to eight% of their token yeah of their token Supply to binance right now it is highway robbery so I don't know that's why we talk about these icos coming back like that's behind my excitement about these icos coming back last point I'll make which every time we talk about regulation is what what's the intent of the law and who's getting hurt and I think you could argue that in the current state of affairs people are getting hurt far more than in a world of iOS where yeah all right to wrap it up I

want to just shout out the blockchain association just launched this dashboard it's the regulation enforcement dashboard it it tracks the sec's anti- crypto Crusade they update it in real time um wow maybe not I don't know how they would do this in real time self-reported data figure updates is proceedings continue it shows the amount spent in defensive litigation 426 million the number of SEC enforcement actions brought against crypto under Gensler 104 uh and it's just a good it's a good dashboard and it shows this big report about um uh like how they think about voter

perception on SEC enforcement so it's timely with the election and talking about and um yeah just shout out to the blockchain association doing good work right folks well thanks for listening go out and vote if you're in the US you're able to vote and eligible um please go and vote it's important Yano that includes you i' I don't miss voting I always vote I know I know I know anyways and again if you're running the marathon drop us a comment uh drop your time your Corral what have you and maybe we'll uh love to see some of you folks out there running or on the sidelines if if if you do see me please cheer me on because I will be struggling struggling do you have your struggling struggling do you have your bib number I

do I do my bib number people can track me I guess no pressure my bib number is 4851 let's go 4851 so there's an app that you can download right yeah there's a there's an app you can download results are online so people can um comment and um I don't have a I don't have a time in mind I'm just gonna go out there and have fun nice um I'm gonna read a post that I wrote to wrap this up okay I wrote this four years ago sent this email to the company and uh I think it's relevant

today um all right I wrote It's Time to vote September 2020 I said whatever your politics we can agree that the upcoming election critical I said Team voting in the US is hard there are 50 states with 50 different systems nearly every other modern democ uh democracy holds elections on weekends or makes Election Day a national holiday but not here in America let's look at what that does to voting just over 36% of eligible voters showed up to the 2014 midterms the lowest turnout in 72 years the 56% particip participation rate in 2016 puts us 26 among 32 developed nations in voter turnout the importance of the upcoming election can't be overstated we'd like to do everything in our power

to encourage you to vote election day is Tuesday November 3rd if you plan on voting in person take as much time as you need uh before November 3rd there are a few actions you can take check your voter registration here if you're not registered to vote register here etc etc um whatever your politics we can all agree this upcoming election is critical so just a little closing complain you can't complain if you don't vote and the Bedrock of any democracy is civic participation and so go out and vote agreed cool cheers folks ladies and gentlemen thank you we'll report back with the new president hey everyone thanks for watching today's episode just wanted to quickly thank today's title sponsor scale scale really is one of the best

chain experiences out there today and I've used so many different chains there's a reason they are gaining so much adoption in both gaming and AI use cases hit the link in the show notes to explore the scale ecosystem [Music] n [Music]