The Ether Machine Chairman: Real Risk of DATs, Who Wins From Stripe & Circle’s Chains | Roundup

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I think that there's a bunch of liability in these shell companies and it's not just, you know, the the pre-existing, you know, having to pay five bucks to the existing CEO of the dying biotech that doesn't know how to spell Ethereum. This episode is brought to you by Geodet, the world's largest decentralized RTK network, delivering real time centimeter accurate positioning around the globe. You'll hear more about them later in the episode. Nothing said on Empire is a recommendation to buy or sell any investments or products. This podcast is forformational purposes only. And the views expressed by anyone on the show are solely their opinions, not financial advice or necessarily the views of

Blockworks. Our hosts, guests, and the Blockworks team may hold positions in the companies, funds, or projects discussed. All right, everyone. Welcome back to Empire. We've got Rob, we got Santi, and we got a fourth guest. I don't think he's vying for the co-host spot, but he he is uh an esteemed guest. We're excited to have him. Andrew Keys from the Ether Machine. Welcome, Andrew. >> Thanks for having me, guys. >> Yeah, Rob Santi, how's the week? >> Not bad. >> Um, no, it's been a great week. I uh didn't know when you guys asked me to do this pod that I was going to be a DAT pod dat. And so I don't know if like yeah would have been would have been the same answer but you know I'm excited to have Andrew.

>> I mean that's the industry that's that's the industry today that we live in. We're calling it suitcoin summer. Not my term. I got it from Jameson Lob. It is suitcoin summer baby. So um Andrew wanted to have you on because um uh several people have told me that uh so there's all the there's all these dats right now and um several people have said you guys are running the best operated DAT and that is not that's my not not my words. I'm I'm sure you would say the same thing but other other people have told me that. So, I did want to get into use this episode to get into a little bit of the operational side of running the DATs, but actually importantly, um, so I I think I can publicly share this because I saw the fundraising deck when you guys were

raising for the Ether machine. Um, you had put in over 600 million of your own money. So, maybe just important to talk about briefly like who is Andrew Keys and how did you get $600 million to put into a DAT? >> Happy to. Uh, and and thank you again uh the three of you for having me. Uh so so if you didn't know me as of recently, it's probably because I kept my mouth shut during the Gensler era. Uh, and uh, prior to that, uh, before Ethereum launched, uh, like a nerd, like any one of you guys, I would I went to the first ever Ethereum meetup that was held by Aaron

Wright in 2014 prior to the Genesis block of proofof work Ethereum. Uh, before that, I uh, did a bunch of different things. worked in at UBS, the investment bank, but but but most recently built a medical records company where simply put, if you went to the doctor's office and you had a procedure done, all of those demographics and your medical information would get sent to Chennai, India, where I had medical doctors that would fight with Blue Cross Blue Shield in India. Uh, and then we would process the insurance claims. So, we did the revenue cycle management. Uh, and I learned everything that was wrong

with payment systems and databases at the same time Bitcoin happened. And I didn't jump in the Bitcoin rabbit hole because simply put, there is one asset of Bitcoin on the Bitcoin blockchain and one function which is send. And the world is much more sophisticated than just me sending you value. When Ethereum, the white paper came out where we could add arbitrarily complex logic. if X happens then send the asset else failure you know simply put you know a a smart contract that's when I got very interested >> and we went to this this first meetup and Aaron Wright who created the Lao uh tribute labs uh was a professor of law

and computer science there and people like Joe Luben were there uh and basically we were talking about you know what is the implications of this Fast forward, uh, Joe was building consensus. I volunteered to, uh, create kind of a global business development strategy. Uh the first time Ether crossed $1 was because I put a permission version of the Java client of Ethereum on top of Azure, Microsoft's uh cloud and we put out a hundredword uh press release uh in the Wall Street Journal with Paul Vignia uh creating a concept of blockchain as a

service which is the thing that kind of R3 started playing with uh where you could tokenize an asset and send it around Andrew, somebody told me I told them I told them that you were coming on the show and they said uh they said ask him about blockchain not Bitcoin in the 2016 narrative and they said uh he he was kind of behind the >> you and Amanda maybe at Consensus were behind the blockchain not Bitcoin of 2016. >> For sure. For sure. >> Well, there was also Ble Masters like on the front of Business Week and like JP Morgan and be like going everywhere and telling everyone glory days. >> Glory days, baby.

>> Yeah. >> Glory days. Yeah. Um and and basically I helped create the enterprise Ethereum Alliance which was the largest open- source blockchain initiative on standards. So the thing like the ERC20 token standard uh things like that that that that I think kind of you know prior to that if you talk like Java and and when it became the most used software language J2E Java 2 enterprise edition it had clean web APIs and clean database APIs and that's where a developer in Paris or Mumbai or San Francisco or New York could all kind of coales around standards and I think we got that relatively right uh which which kind of helped I would say kind of some of the parallel

dynamics Ethereum has now. >> Yeah. Okay. So you so you joined consensus in so okay so Ethereum launches this is 2015. You joined consensus you and Luben and all the crew and I think a lot of people know the consensus story grew like crazy kicked you know spurred a lot of the good innovation in the ecosystem. You did that for four years. Then um we met I remember when you were doing consensus then you had just went and did Dharma cap if I remember. >> Yeah. Yeah. So s uh Dharma is an acronym for digital asset risk management advisors. It is a commodity pool operator, commodity trading adviser registered with CFTC. We've managed billions of dollars of institutional size Ether uh and and basically have bare metal staking

uh and and and one of the kind of the largest staking providers uh on Earth. uh we we've kind of stayed quiet and just done our job over the last five years since the inception of proof of stake, but you know, it was time to kind of start making noise and basically kind of that that kind of gets us to where we are here now. uh one of the large institutional ETFs came up to me uh and and and asked me to be a market maker because they believed that ETFs were going to enable staking and if uh right now the ETFs don't enable staking I believe they will let's

call it 3 six9 months from now and this is kind of really important of like why we actually did this uh if you look at the ETPs in Europe or Canada they do have staking But they they enable staking at what I call 50% capacity. And of that 50% capacity, they do that at what I call the floor yield. And what that means is if you have a billion dollars in the Canadian ETP, they're only able to stake 50% or $500 million and they're only able to do vanilla staking, which right now back of the napkin is generating 3%. So they're really earning one and a half% on the billion dollars. The reason why they're doing that is because of a technical

nuance solely in Ethereum. It's not on Salana. It's not on other proof ofstake networks because Ethereum Foundation doesn't care about any of these financial rappers, ETFs, uh, Pubos. What they care about is the robustness and safety and and the scalability of public permissionless Ethereum. And simply put, right now, if you wanted to unstake your Ether, it's about two weeks to get it back. And if, god forbid, a Black Swan event happened on planet Earth and 50% of stakers wanted to unstake at the same time, the withdrawal queue would extend from the two weeks it's at now to 6

months or a year. and that does not jive well with uh the 24-hour redemption requests or or mandates of the ETPA's ETFs. So, basically, I had this kind of thought process that well, the ETFs are are only going to be able to do kind of this 50% staking. You just saw the liquid staking tokens have DPEGs. uh you're not going to be able to have something like that I would say anytime soon and uh if you do you're kind of introducing a different vector of like let's call it smart contract security audit risk factor if if you wanted to introduce liquid staking tokens. Uh but

in any event, I I saw that the ETFs were kind of an inefficient way to hold specifically Ether, and I'm, you know, for better or for worse, a bit of an ETH maxi. Uh and and you can beat me up for that, but uh I think that that point I said, well, you know, there should be a better vehicle for this. And and we all know what MSTR did. uh and they're only able to participate in what I call this floor vanilla staking yield. And I would consider that one of three buckets. So you've got staking. Now you've seen the evolution of restaking. So I layer is is

is one of the the main protocols there. Andre invested 10 out of 100 about a year and change ago. before then I invested two on my own balance sheet at 25 about two years prior and we've been kind of closest to the metal with them in doing bug bounties smart contract verification uh auditing user experience so we saw that you know for example the the leading uh as I dA with the 300 basis points that you're earning in staking yield you can add an additional 45 basis points reststaking to IDA And there's 300 of these ABS's. 85% of them probably won't find product market

fit, but you can work with the top 15 just like you know all internet mathematics where 85% can go to zero. 15 of them will work. And uh so so there's another bucket there and then there's the you know last bucket that we all know and love DeFi. And we weren't interested in kind of doing the latest uh latest greatest DeFi app that's yielding, you know, some silly APY. But things like a are pretty safe. They've had a $50 billion bug bounty over the last five years and and you can do things where you can, you know, create a liquid staking token, borrow uh that and stake more and and and basically you're

not taking necessarily ether price risk. you're taking the risk of the yield of the a interest rate versus the staking you can generate. So there's kind of sophisticated DeFi strategies and I said that well we could create a vehicle that could outperform the 50% vanilla floor staking yield and we could do restaking and we could do DeFi and we could have an actively managed vehicle versus what's out there in the market with which is the kind of the ETF yield.

And so so so with that then I went down kind of a decision path and I think this is something that I really haven't heard you guys discuss but but but because I think you guys have addressed a lot of like the core issues like DAT selling unlocked tokens and and marking them at one one to one and not having liquidity. think that's right on like let's call it the blockchain side of the house but kind of I'm surprised I haven't heard more about the cobwebs or or the the the the shadows or the issues of pub codes.

And so basically there's kind of two paths one can go if they want to take uh advantage of let's call it the public equities and the public debt markets which is what these vehicles can do right uh one is you can reverse take over and you can pick your poison a dying micro cap a dying bitcoin miner you know a dying whatever. And with all of those, I I did like three of these phone calls of of of these these companies that were basically failed and uh and and and basically wanted to be resurrected as a treasury company. And with all of these, you had to pay the

existing operating uh management, you had to keep them on the board, uh you had to pay the liabilities. uh you have statute of limitation issues. So if company X did something wrong in the last four years and company X was worth zero up until you put a billion dollars of pick your asset, the the class action lawyers didn't care. But now it's a honeypot for class action litigation. Uh and and and and I just kept going down these these rabbit holes. There was a Bitcoin mining company that had a $10 million a year lease in a data center

and they were in year four of the data center lease and they had six more years to pay 10 bucks a year and and I was like, well, if I was going to deploy my money into a vehicle, I only want pure play exposure to the asset. I don't want to have to pay uh you know the CEO of the failing biotech that doesn't know how to spell Ethereum. I don't want to have to pay the hardware lease of the data center uh that's in year four and have you know six more years of >> Don't people do this don't people do I so I get the problems that you're getting at but don't people do this because it helps you get public really quickly right there's like there's pros

and cons of it. >> Yeah. Yeah. So absolutely versus IPO and like and I think that here's like the devil's advocation to it is like I I thought that the better way to do this. So is there's the reverse takeover and then there's the spa, right? So the other way to do this is a special purpose acquisition company with a denovo LLC that has no previous operating business, no previous liabilities. And I think that we are in the first out of the first inning of all this stuff. And I bet over the next six months, over the next year, we're going to see some of the shadows of these previous operating businesses uh and and

the issues with that. And there is, let's call it like the liability side of the equation and the cost side of the equation where you have to pay the extra managers. But there's also what really made MSTR work wasn't selling ATM and diluting their existing shareholders, which happens if we sell at ATM uh and issue this equity. Uh what made it work were the convertible debt offerings and the preferred shared offerings. And and when when you consider that basically the the buyers of that convertible debt andor preferred shares primarily are these large hedge funds. And what they need is to

underwrite this paper. And we think that and and and and you can see kind of the first convertible debt offering in the Ethereum space just happened with Yezzilla. uh the terms weren't great and and I think that you know basically it was a call option at spot and if you can kind of compare that versus the MSTR one where they were able to have terms that were over 100% initially and and and like that can be dilutionary to the shareholders as well and so where I'm going with this is that I believe that if one has a denovo entity that has an auditor like a big four. um

we are going to be able to have better terms to come to market with what actually works for scaling these vehicles which is like the prudent risk management of debt and preferred shares and so while and now to devil's advocate this so why doesn't everyone do this or well we have seen others do this so C is doing this caner equity partners >> there's a longer lock people don't do it because there's a longer lock up on the spa right Right. So, so basically I'm in what's what I call uh dispack purgatory. >> Yeah.

>> And uh and and we're still able to write raise capital uh and we are uh let's call it privately. We did the largest common equity offering since 2021 which was you know $1.6 billion of committed capital and we're going through other iterations of things like that. But to to your point, I'm not able to sell equity at the money in a public vehicle yet and or sell let's call it convertible debt at a public vehicle. So there's this kind of 6090 days that we go through the uh eyes dotting and tees crossing with the SEC uh that that we have to deal with. But

that trade-off for me of having something that's completely denovo that doesn't have all of the kind of operational hair that I believe will be scalable uh much faster for what actually works to scale these vehicles uh is is the trade-off that I'm willing to make. Andrew, what would you say to the So to play double's aggate and I I don't necessarily disagree with you, but if we look at Bit Miner or Bitmine, uh, for instance, you know, they raised 250 million in the pipe. They hit the ATM really quickly. They scaled quite quickly. I think they're over $2 billion today. Um they to your point they had this you know kind of business that

existed before that could theoretically be you know like you said a honeypot for for shareholder liabilities but now they're also sizable enough that theoretically those liabilities kind of don't matter and they this me this traded this premium theoretically that allows them to also be attractive to you know the call it the the convert investors who want to play you know gamma or want to play volatility right and so their quickness to market allowed them to do this thing that you know essentially where they started much smaller than you are now your size or bigger and have been able to potentially you know put to rest or not have as much concern around those those things like liabilities like you talked about.

>> So so I think I think that's a great point. I think for every one bit miner, there's 10 others. And I think that uh Tom Lee is a force of nature and uh is doing great for himself, his shareholders, and for uh I would just say the the broader Ethereum ecosystem. But I I would say that uh that is kind of the exception to the curve. And uh I do still think that uh there is going to be issues with issuing converts because there will be investor exhaustion uh at

the ATM eventually and I don't know if it's sooner or later. Uh but I do think the ATM and I think that Micro Strategy did a good job of of kind of uh detailing, you know, under two and a half MNAV. they're not going to hit the ATM. Two and a half to four, they'll do it opportunistically. Over four, they'll do it aggressively. And in in some of the other vehicles, we've seen negative shareholder sentiment and kind of the the the stock price selling off uh when ATMs are mentioned. So, I do think the the the there is an issue with that. And I do think that the converts, the the pricing of the converts matter. And in order to

get properly priced converts, you have to have the cleanest paper, and you have to have the right auditor. in a bunch of these kind of reverse takeovers of dying shells that have a law firm you've never heard of, an investment bank you never heard of, uh, and you know, an auditor you've never heard of versus we came to market with City, with Scatteren, uh, and we're going to have a goldplated big four uh, as our auditor. I think that's going to matter in the long term.

>> Andrew, are you competitive? What are the uh what are the competitive dynamics actually in this market. So if you look at the like you're kind of competing it's funny like Luben right you you worked with Joe for >> sure >> several years >> it's co-opition >> and and and and what I'd say is you know it's interesting that uh and and I think we're like in a slice of time right like this is you know month three out the gate of all of this stuff and and and it'll be interesting to see month six month nine month 12 month 60 five years from now what what what happens Um, I what what what what I'd say is I think everyone's playing nicely in the sandbox with each other. I was just on a uh

panel with Joe Shalom uh of Sharp Link and Tom Lee of uh Bit Miner and and I like them and and I want them to win. I think that, you know, there's Uber and Lyft, there's Pepsi and Coke and, you know, whatever your analogies and I think there can be multiple players in the space, but I do think that there are kind of differences in these vehicles and like I I I think there are a few things and and I think our corporate strategy where there were a bunch, let's call it in the Ethereum space that did reverse takeovers of dying micro caps where we didn't. Um there are a bunch where they're doing outsourcing of asset

management. Uh your your your typical fourth is Avashal who I love. He is a superstar. Uh and he is the benefac the beneficiary of the an outsourced management contract. I don't know if for shareholders uh outsourcing the asset management if if these vehicles are supposed to have active management where they're generating let's call it the vanilla yield being three and if you can add restaking and participation in DeFi it go gets up to five or six um and outsourcing a fee to an asset manager you know 2% in in that example or to Galaxy or Pary and other ones where

where they're getting they're they're paying one and a half percent and that doesn't really scale with AUM. Um because the the the fees just kind of grow with the AUM. Um I think that's a a a difference um of of kind of having it inhouse as an operating company where it's kind of a creative to shareholders versus an expense. So I think those are kind of differences. This episode is brought to you by Geonet, the world's largest decentralized RTK network, delivering real time centimeter accurate positioning around the globe. Powering technologies that enable precise navigation for drones, autonomous vehicles, first responders, farmers, and robotics. Geodet shows that blockchain

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Just want to go back to like a big picture. Someone who's been around space for such a long time. If you um if a early version of Andrew that went to that first meetup was listening to you right now talk about the over financialization of these vehicles, do you think that the vision has been co-opted? Do you think that we've been overly financializing this stuff or would that excited nerdy version of Andrew Keys be proud of what he's seeing right now? Great question. So, like I I think there's like a the early nerdy version of me like left that meetup and was like, "Oh my gosh, we're going to d decentralize all the things, right?" And all of the banks in America are going to

go to zero because we're going to be able to have this software that just works, right? And uh I think I've matured since that point. And uh I still do believe this technology gives a price discovery mechanism for the value of intermediation. I also believe like the notion of like decentralized Uber immediately uh was very naive because Uber's created massive network effects as an example has created this slick UX and Ethereum is almost ready to almost be ready for a layer 2 scaling solution that has privacy confidentiality and it takes a decade to actually build good software.

So, I also think that uh this avails public market investors that don't want to deal with a public private key pair or getting their Coinbased account hacked or you know whatnot. And it's kind of meeting people where they are. And I think the other piece to this is like this is the first time you're going to have real sellside analysts. I think like kind of circle was like the opening act, but uh you're going to have sellside analyst coverage on what is Ethereum, what is staking, what is restaking, what are the financial models that go into that, and do you want to like debate what a TAM is of the internet or what of the TAM is that you know trustlessness or decentralization

can enable? I I just think what this is doing is uh broadening the horizon and you know do I think that we should garner 50% of all the assets in this vehicle? No. I mean MSTR as what 3%. I I think and I think what Sailor has done as an evangelist for Bitcoin probably outweighs the negative of having let's call it 3% in in a public vehicle.

Andrew, can you talk a little about um and maybe you know in these vehicles so understand your point around access and distribution and you know why you think they still fit within the original ethos. Um the other thing that we've there's been a lot of conversation about is not just okay well now it's not just distribution but we're also doing I think Santi use the word overf financialization. though there is you know call it um not just staking or defy yield but um you know there's been a lot of rumors which I I think Tom Lee hasn't really talked about but maybe is doing you know call it like structural products or derivatives also on the on these vehicles and how will that also fits in to you and and do you think that's true and and how do you view that

as part of a normal operation here? I mean I mean so like it or not these are the smartest people with the sharpest elbows uh playing for table stakes of how society is going to work in a decade. Uh these are big stakes, right? Like this is cool stuff. This is like interesting. And and I think that financial engineering is going to happen no matter what. Like I I think that uh having it in a regulated purview that has a hund times the liquidity and depth of the current DeFi infrastructure is good. And I think you know having access to

the public markets then can actually fill the pipes of DeFi uh where where you can start you know reallocating resources to uh the DeFi markets and and and show you know the delta of what it costs to do on a smart contract based Rails versus what it would be doing legacy. Um, I guess as a followup, not to harp too much on this, but um, five years from now, there's going to be some doubts that clearly there weren't good stewards of capital.

The structure was correct. These things work. Bull markets have a phenomenal way of hiding um, nonsense, including poorly structured vehicles. Um I get your point around everything's going to be financialized. Like crypto is an extremely financial like you know these are asset ledgers. You're supposed to move and transfer value. Uh DeFi the plumbing is there. We don't have good distribution. These vehicles can serve that purpose. I'm not you know I I very much agree with that. Where do you think um as someone that you know has been around for such a long time like there are clear risks that you may not control how the nth dad gets structured but as an industry or a person in your position

what are some of the the risks that do worry you and what can be done about them. >> Sure. So, so, so this is like the part of the equation of like play silly games, win silly prizes part of the conversation. I think uh that that uh as a participant who's created a public vehicle, uh I have let's call it the tail risk of somebody who also created a public vehicle and that blows up. Uh I'm seeing lots of silly games and lots of silly prizes. Uh the first example is I I think that there's a bunch of liability in these shell companies and it's not just you know the the

pre-existing you know having to pay five bucks to the existing CEO of the dying biotech that doesn't know how to spell Ethereum. I think that there's that you you you've start started to see and like the the shell codes have kind of gotten picked over so there's not much left. So like they they they start to cost more money and you're starting to see kind of issues where now if you were going to deploy capital into this vehicle, they're saving part of the capital that's invested to settle lawsuits. So I think things like that you're going to start seeing wasted. Um I think you guys already raised this point, but it's amazing to me. Uh you know, in my example, Ether traded 60 billion in

volume yesterday. spot. Uh the the the the the 200th market capped asset that hasn't even gone live yet. Uh that has a locked up token schedule that's getting marked to market at one versus uh you know at a 50% discount because it's not going to be liquid until two years from now. I think that's a big issue. I think the dilutionary nature of ATM uh is is is like very much in plain sight and it works let's call it at a multiple greater than two but people are hitting that earlier and you know one of our key our our our north star which is

going to align and so I'm patient zero of my public vehicle I am the largest shareholder and and and basically I'm maniacally focused on increasing my ether concentration per share. uh and I don't know if retail really understands like that notion uh in in any of these vehicles and they may see a stock go up or down but but retail doesn't necessarily know that you know an ATM issuance uh basically creates more shares and you still have the same shares and the price of those shares may go up or down but but but you've basically been diluted um and and I

think kind of like the the the structures around that are are important. So, I mean, I think those are kind of like the opening acts of of what can happen. Um, and then to your point, we've seen this story with, let's call it, the Bitcoin mining op codes. Uh, Bitcoin rewards went down, the comp kept going up, uh, busted cap tables, busted governance. um they're upside down and and and and and the opex ran out of control. Hash rates continue to go up and so I think there's something to be said about like aligning shareholders with executive management um in in like what is the

north star of the vehicle. So again, I put in a material amount of money of my own and and I am solely focused on generating the mo the most ether per share without diluting myself and like holding management to that kind of north star is what I think is the most important. >> Andrew, can you talk a little bit about what you think uh the rollups of these things could look like? Like let's extend Santiago's question out like some of these blow up.

>> Yeah. >> Yep. So, so I think there's two variables to like consider. One is let's call it like accretive M&A of of uh of of assets that can generate uh yield in the underlying. So let's for for the Ethereum equation, you could talk about potentially a staking company. You could talk about a custodian. You could talk about, you know, maybe even an L2 um that can generate ether denominated yields. So I think that uh as we see staking commoditized the staking companies uh yield is going down as well like as

their revenue and I think that you know first and foremost there's potential M&A roll up that could be accretive in that direction but then when you talk about let's call it the uh treasury companies you know treasury company you know 52 of ether that came out the gates with let's call it a hundred bucks instead of like the critical mass they need of a couple billion dollars especially let's call it in the Ethereum space um it's going to be hard to like disagregate because you you don't want to inherit the same issues that I raised about let's call it the shell coast like I take the assets but I don't want another publicly traded vehicle

>> you should be able to do an asset sale that shouldn't be an issue I don't think >> right so so so That's where I think it goes. And like then like the the interesting conversation is is what happens to those shell codes like uh and and and then but that's not necessarily the acquirer's problem. But I think that you could definitely get to a place where you could do asset sales especially at depressed MNAVs. And then I think another kind of piece is is is you've kind of seen these like Frankenstein ones which I was not a a fan of where there's 20% Bitcoin, 20% Ether, 20% Salana, 20%, you know, pick whatever you want. Um I think those are going to have the hardest because what

we found from like an institutional round that was driven by city is is is allocators wanted pure play to a specific asset. Uh and and so uh I think the ones that are going to have the most problematic time are the ones that are a these illquid shitcoins and b the multistrat uh pub codes. >> Would you So I've had this thesis that I think we talked about a little bit on the podcast with the vual that you know theoretically you might go and buy the story protocol one or maybe not story cuz it's all like locked up. Um, but >> I wouldn't touch it. I mean, I think that's I think that's a

>> Well, so so the reason I'm asking, right, is so you do an asset sale, you buy call it whatever a another L1 that is locked up, a Salana one that's trading poorly, and you just dump the Salana into the market uh and go and use that because you again you got uh you're trading at some premium, they're trading at some discount, you theoretically that assets can then be sold and you can use that to buy more ETH. It's call it 20 30% accretive, right? Is that something you guys would consider as well? Yeah, I mean it the devil's in the details of the math and like how you can, you know, convert that OTC and if you can do it, you know, in a time efficient way and then you got to pay for slippage. But like that's the M&A art and lots of

leverage buyout analysts that are smart smarter than me know how to do that. >> Uh Andrew, where does this how far down on Coin Gecko can you go here? So you so the Bitcoin ones work, right? Micro Strategy, you've got you're saying Ether ones work. the Salana ones are like kind of working a little bit, but like not really. Um, and in in the way that you haven't really got the the nor the the story and the narrative like the Ether ones have. Um, Rob was talking to a guy about the Athena one the other day. You mentioned story like how what how far out can you go?

>> I I I I'm not going farther than number two. >> Why why though? I know you're Yeah, you >> illquid. >> Yeah. uh and and and then with with those like unused like I think Bitcoin is you know has its Lindy effect has its store of value narrative has its maxi has its already let's call it category defining winner already um Ethereum you know when you go down the rabbit hole consensus put out this great artifact about kind of the trust report and FASB the financial accounting standards standards bureau uh board, excuse me.

Um, they have this definition of HQLA, high quality liquid assets. The 250 billion liquid assets that are high quality defined by FASB, 90% are on Ethereum and then 10% is everybody else. And it reminds me of uh the gravity law dynamics of something the parallel law dynamics of Google where 90% plus of searches happen on Google and then Bing gets 1% and Yahoo gets 1% like when's the last time you used Ask Jeeves and and and I think that we're going to see similar power law dynamics there.

And so I I I I don't think it's worth it, but again, maybe I'm biased. If you were these, if you were founders of these things, would you be do you think it's smart to do this or do you think it >> Well, I mean, I think if you know, if I'm the Cardano, you know, if I'm, you know, you pick your your your your asset, uh, I would love, you know, if if I created asset, you know, 10 to 200 in coin market cap. Uh, I would love for an operator to take the risk, spend the time to develop uh, you know, one of these vehicles that is labor intensive

like it's running a public company. This is like non-trivial and I and and it'll be very interesting to see what happens six months from now because it costs a lot of money. It it it's a huge time suck. Uh and and and and I think that invariably the the the it's not going to be worth the squeeze. The juice is not going to be worth the squeeze for the majority of these things. >> Um but but if I'm but if I'm, you know, protocol founder X and I'm, you know, a technical leader, I would love some operator uh take the risk and then try to, you know, sell this to Wall Street, Main Street, and whoever will listen. um and you know try to create some type of

uh flywheel. >> This episode is brought to you by Geonet, the world's largest decentralized RTK network delivering real time centimeter accurate positioning around the globe. Powering technologies that enable precise navigation for drones, autonomous vehicles, first responders, farmers, and robotics. Geodet shows that blockchain can be a truly transformative force. By delivering real time centimeter level accuracy, Geodet enhances emergency response, boosts construction precision, and enables advanced navigation for drones and surveyors far beyond the limits of standard GPS. To find out more, click the link in the show notes or follow them on X. Hey everyone, Jason

here. Earlier in today's episode, you heard me mention the weekly CIO memo from Bitwise. In an industry as hectic, fast, and complex as ours, it's incredibly hard to get an easy, nononsense stream of what's actually moving crypto. The memo comes from Matt Hogan, Bitwise's chief investment officer. He's been on the show before, and he has this amazing ability to take the most complex topics and break them down with clarity. Trust me on this one. The Bitweise weekly CIO memo is really worth the five minutes of your time.

Check it out at bitweisinvestments.com/cio memo/mpire or just hit the link in the description of today's episode to get started. Carefully consider the extreme risks associated with crypto before investing. As always, investments in blockchain technology involve risk terms and conditions apply. I was going to say it seems you're dubious because you use the word, you know, try to sell this to Wall Street. Um, and you know, the Salana ones have had, you know, decent amount of of interest. I think there's, you know, probably one coming out pretty soon that's going to have over a billion dollars or something like a billion dollars. Um, when we've seen actually, I think maybe some of them aren't public yet, but probably over a billion dollars

of demand. and some of these assets that are like, you know, 10 through 20. I don't I don't think it's much longer than 20. But why do you >> Yeah, maybe that's fair. Maybe that's fair. >> Yeah. Why do you think that interest exists? Do do you think that's, you know, ephemeral or or what's going to happen there over time? >> Yeah, I No, I I I think, you know, may maybe I'm I'm I'm being a bit curt in in the fact that that I'm saying top two when it maybe it probably should be top 20 and and I think that there'll be, you know, risktail associated after that. Um, so, so, so, so your point's taken. I think that that is fair.

>> Andrew, going back to the original thesis of why you did this, you were saying the ETFs are structurally flawed vehicles. What can you actually expand on that? Like what's your end vision for these ETFs? >> So, so if you consider uh the ETF a stock that that that could have a dividend. So like a productive asset like Ether or Salana that that can be productive with staking unlike Bitcoin. So like for Bitcoin, I think it it makes total sense to have ETF. It's the lowest. >> I get I get so I get the I get the problem which is the yield is going to be lower like the dividend will be lower but long so because staking restaking DeFi activ uh yield activities in DeFi.

Um but like long term do you think these vehicles I'm talking like five year time horizon. Will these be larger than the Ethereum ETFs? Like will the Ethereum ETFs just not take off is what you're saying? >> I I I I don't think I I mean I think that we've seen that right. Like if you look at what's gone on in Bitcoin ETF versus Ethereum ETF and then you just like match the market cap of Bitcoin versus Ethereum, you know, proportionately the Bitcoin ETFs have garnered more value. And I think that the market realizes in the ETF uh you know, I'm not getting my yield and it'll be interesting to see once yield is enabled or staking is enabled um what happens there. But if you look at the proxy in Canada and Europe in the ETPs,

it's 50% staking capacity. >> Yeah. and and especially as restaking kind of takes off and DeFi continues that like if you look at this like a perpetual bond which many do with with with staking you know if you if if if the ETF's generating one and a half% yield and just out the gate you can double that yield should double the price of the the bond uh andor you know adding restaking adding DeFi it could triple or quadruple um And that's where I actually believe in addition to let's call it the legacy financial engineering of converts and preferred that you can uh justify an MNAV in perpetuity if

that's what your kind of northstar is. Uh I think that this is just a better vehicle for the majority of people to uh earn additional ether per share. Um, Andrew, what apps you mentioned a what apps do you think benefit the most from this? I think they're going to have to be the I I think something like a will be is is exemplary of what's going to benefit the most because I think of let's call it the big boys that have let's call it over a billion dollars of assets at least in the Ethereum ecosystem they're not going to go too far down the risk

curve because you know a lot of this is don't screw it up and and you can earn pretty good yield staking restaking and let's call it lower risk DeFi and and and you should any of these uh vehicles the people on those teams are comp competent enough to be able to earn a blended five six seven and and if you're going to keep going on the risk curve to go to 10 15% yield in a big vehicle that has this that extra yield comes with risk whether it's smart contract risk risk whether it's impermanent loss risk and I don't think

that these vehicles are going to be built for that. I think that you know people can take you know 100 grand and try to earn you know 100% APYs or you know whatever. Um at least our vehicle we we think that we can stay prudently riskmanaged with you know issuing converts let's call it sub 20% converts or andor preferreds uh and generate let's call it a blended yield that significantly outperforms the ETFs and kind of stay in a lane safely. So I think kind of like the larger uh more established, you know, AB has, you know, 50 billion plus of TBL for five years.

So essentially a bug bounty for that long. >> So are you are you buying A's token in Dharma C like >> No, but you know, we we've used it. Uh yeah. >> Yeah. Yeah. Yeah. Are you all >> this is like Ether Ether denominated? >> Yeah. Are you just an ETH right now, Andrew? No, >> no, >> no. I've got some IEN. You >> got some Ian? What about Li? >> I got some Filecoin. Uh, which which I I I still think is a great >> my friend. Yeah, but but it's but it hasn't, you know, >> your portfolios >> ETH and Filecoin right now.

>> Yeah. Yeah. I would say let's call it 98 and one something like that. >> Yeah. Yeah. Yeah. I think that's Go ahead Santi. >> Yeah. Maybe more zooming out. I know you teased out this idea that you're a ETH maxi and um no one's perfect right? >> You this is this is the the common disease I guess in the space. You come at it with a very open mind about changing the status quo and then you sort of calcify or oify into one asset that has made you a lot of money. Um, how do you what are some of the things that look Ethereum's Ethereum because in my mind it the proof of stake the transition from proof of work to proof

of stake was remarkable coordination feat and I think that is probably one of the strongest things that can that Ethereum has. You know it hasn't gotten perfect. Uh it sometimes doesn't serve you well to go first uh in this open source environment. What are other ecosystems? I appreciate your holdings are one thing but are there other ecosystems that you look to and appreciate certain elements of them like Salana some of the other sooie say what have you.

>> So I I uh >> Ripple is also a fair um is also valid response in this podcast. It is a safe space here. >> Fair enough. Yeah it well you're not going to get too much on those out of me unfortunately. I mean, I I I I'll go back to kind of like and and maybe it's an ETH Maxi response like liquidity begets liquidity. You've got kind of 90% on Ethereum of real assets. You know, Salana can keep the mean coins. Um you've got I think client diversity matters. Uh there's one implementation of Bitcoin core, there's one implementation of Salana, there's nine implementations of Ethereum. Uh that matters. uh uptime and decentralization uh I think that matters. So, so like at

let's call it like the smart contract layer one, I haven't been too interested. I've been very much uh into and and it and and again maybe it's talking my book, but it's what I do. I I've been staking institutionally sized since inception of proof of stake and and I think that like the the notion of this concept of using this large proofofstake security mechanism which is Ethereum's hundred billion dollars plus to uh secure other let's call it middleware like data availability or compute or LLM. So like I've been really digging into what's happened and and frankly to

devil's advocate me there. uh not much has come to fruition yet of like the iigen layer or symbiotic or let's just call the ABS ecosystem but I think that there's like a Cambrian explosion there and and that's what I'm looking at and I think like if you think about like behavioral economics or incentivization I think like the notion of like issuing a governance token or utility token that's you know worth a 100 million bucks to secure my whatever you know, my LLM or my ZK Snark prover or my my my data availability vehicle versus uh using like this larger proof ofstake

security that's worth hundred billion dollars um to secure. I just think that makes sense from an architecture perspective. So I think that uh the the the layer and symbiotic ecosystems I've been looking at. Um, and then I think that like we we've all kind of and and and Block Works I think is right that we all have like infrastructure fatigue uh and like where's the app layer and and I and I think that that's totally right and like you've started to see some product market fit with things like stable coins but uh I still think that like we're super early days of like the zero knowledge world and and kind of looking at that uh and and I don't think

that there's been product market fit. I don't think we've seen necessarily uh business plans or operations or scalability in that, but I think that there's kind of so much. So like from like a research perspective, I've been looking at like the zero knowledge world and the uh let's call it reststaking world. >> That's fair. In terms of um commenting a little bit about infrastructure fatigue, double clicking on that, you have Stripe now launching their own L1.

Um how do you think about that and maybe overlay some color around the L1 L2 construct and has that is that work and the value cruel back to ETH may as an L1 like general thoughts? >> Sure. So, so I think I'll start with the ladder first. I think that, you know, to to to kind of analogize things like to to to Uber, you know, when when when I used to take an Uber from downtown Manhattan to uptown Manhattan, it would cost 50 bucks. Now, it costs 150 bucks.

And uh it's the same ride. Uh maybe there's a little bit more traffic thanks to Uber, but but but it's the same, let's call it three miles. Uh, and I think that at the expense of near-term profitability, uh, the Ethereum Foundation decided to make L1 blob space dirt cheap and and and there has been, I would say there have been wins where you have kind of the fast mover. It's not like the systemically important financial institutions like the Goldman's and the Bank of Americas and the cities because really they haven't been allowed because this is all new because we're in a new

era you know post Gensler but Coinbase created base Robin Hood's tokenized securities is an arbitr uh you've seen kind of the early fintexs that are publicly traded with lots of I would just call it revenue deploying these as cheap architectures. Uh, and I think that in time you've got EIP1559 that burns at layer 1 and 4844 that essentially burns at layer 2 or uh when when layer 2 blobs are transacted.

Um, I think in time the Ethereum community is going to say, well, this is too cheap and and and you can raise that pricing. But, you know, those are, you know, and Kraken's got ink. Those are kind of let's call it three of the fast movers. you need thousands of these L2s and uh until that happens I think that the value acrruel will be less uh than it probably should be but you know the the example was was analogizing to Uber but basically once Uber became ubiquitous they triple the prices and and and you know what you know as blobsp space gets more competitive you can raise the prices and I think that you'd

rather have, you know, due to the stickiness of technical architecture, you'd rather garner the uh the architecture to anchor to your layer one uh with with with Stripe uh and the the other one with Circle. Um we'll see like we we've seen uh was it Facebook did did what was it? Libra like that never happened and and and maybe I mean they they have that was you know and that was at a time where you know there were issues with with these with these architectures and we weren't in a regulatory environment that was conducive to moving things forward

but like I I if I were to read that uh you've seen you know circle ripped at IPO now the analysts have dug in they made this horrible deal with Coinbase where Coinbase is earning more per transaction than Circle is. Um, and they're trying to figure out how do we generate revenue with the incoming lowering of rates. So like their their their treasury rates are going to depress. So, like if if if I'm circle, where I make my money is I I buy treasuries uh and and I live on that spread, right? Then the the the the user

that has the dollar coin isn't earning, let's call it the 4% treasury. But you get Fed rate cuts in September, October, November. But actually, you know, running the L1, that's not where the money's at. I I I don't think so. >> Rob, maybe can I actually ask you? You had this tweet. You said um maybe building off what Andrew was saying, you said pretty clear indicator that they um uh that they now agree what many others have theorized that the primary issuance business model is dying and that they need to become a payments business to survive. Can you maybe just you know expand on what you think about Circle's launch of Arc?

>> Yeah. So I think Andrew alluded to this like pretty well, right? So to the point about how does Circle make money today, right? it they somebody mints stable coin uh they buy or black rockck buys a treasury on the back end I'm simplifying and you know today the interest rate on that treasury is something like four and a quarter right you know if you look at their their um most recent Q then they came out with earnings you know they put in their risk factors what happens as rates come down right and they already have pretty bad margins to Andrew's point around the fact that they give, you know, right now it's like 53ish% of all of their gross revenue to Coinbase.

They uh are not now also giving a lot of revenue to basically everybody else for distribution. So, they signed a deal with Binance. They've signed a deal with like a ton of startups who frankly they should have or do have a lot of power over and theoretically wouldn't have to share that yield. But, it seems like they've really decided that they're going to do that as as ways to proliferate. I mean in their risk factors you know they put that if uh interest rates were to come down a 100red bips they that would cut their um their gross revenue by 23% and their gross profit by about 30%. We're probably going to get now you know this morning's um you know reading on on on PCI notwithstanding like we still are

probably going to get 100 bits of rate cuts in the next you know few quarters right um so if you take all that into account and the fact that okay they're paying more for distribution gross margins are coming down rate cut rate cuts are coming like they don't they have to look forward and they have to understand that there needs to be something else to make money and there needs to be a different narrative or story with the public market investors. So they launched CPN. CPN obviously happened right before they went and and CPN is the circle payment network for people who don't know that launched right before they went public. CPN has been as I understand it and this is not public has not been particularly wellreceived and somebody might reach out and tell me I'm wrong but there hasn't been a lot of flow that's gone

through that but that was that's kind of a messaging layer that's just on top and it's really meant to you know provide some sort of value added like software or services or APIs to say hey look like we're a payments company. ARC is clearly a an an attempt to kind of deepen that kind of like full stack like payments business. So they're now saying, "Okay, well, we're going to have, you know, an FX desk and or uh, you know, just a centralized exchange." That looks like probably like, you know, all of us who have been in FX before, like a, you know, single dealer uh, type of platform that you see in like a larger bank, right? And so all of a sudden, Circle saying like actually like we are a, you know, full stack payments business and we're a bank. They're, you know, I think

it's either public or it's been rumored that they're looking for a bank account license as well. we're going to do um you know all of this called like Swift messaging layer and we're going to be Visa on the network side and they're trying to tell a story that like going forward we are a payments company because what's happening is Stripe is basically doing all of that already and then launching their own L1 and also their own issuing their own stable coin and telling all of their merchants you do not have to use USDC I will offer you a great fantastic product to do everything that you need but you can use my stable coin in my network and why would you even USDC and they're clearly being reactive and defensive against that.

>> And and I just add I agree with everything Rob said and and I just add then they're the worst payment processor there is because they don't have the economies of scale of all these other ones. So they're like the last person in the door in the payment processing world right? I mean, like, pay with Circle makes sense or pay with USD makes sense because you're you're you're disintermediating the payment processor. you know, I can I can pay with my American Express or I can pay 3% less w with with with with with Circle or with USDC, but you know, as a quote unquote payment processor when we all know like the underlying technology is dirt cheap now and any one of the other ones that

have these incumbent network effects, you know, PayPal, Venmo, Stripe at all, um that's what Circle doesn't really have. So, I think that that's going to be, you know, a tough hill to climb. What what would you do though if you acknowledge like you know this is as biased of a tweet as you can possibly get which is from Paulo um uh he Paulo tweeted some company's strategy feels exactly like watching moths flying to the flames obviously in reference to you know circle launching arc so I guess Rob uh if you if you acknowledge that there's a big problem it sounds like you acknowledge the problem but you don't think arc is the solution >> no if you look at what tether has done right and so so Paulo obviously you He

wants to uh you know he wants to belittle like what circle is doing clearly like you know their his biggest competitor today you know what has po done okay well we're going to go and actually invest in like four or five different chains so they've invested in plasma they've invested in uh stable they've invested in botanics they've invested in you know a couple others and they're saying okay listen we want to proliferate USDT and all of these different ecosystems they're doing um some some work with obviously Rumble and some others around trying proliferate their their ecosystem and moving get USDT into you know different types of of companies or you know real world usage like they're trying to do you know what I think a lot of the original vision was which is hey we are actually we're

unopinionated about you know how you use our our stable coin as long as you use it um you know legally or where you use it we're opinionated about using it we're opinionated about getting this better form of a dollar into the hands of people globally right and giving that access and so that's in like the clearly the strategy that they've taken where now what circle is doing is they're kind of it looks like they're trying to um control their FFT right a lot of what they're doing is actually elbowing people out who would theoretically be partners instead of opening up and bringing people in right and so when you think about like ARC from that perspective it's hard for me to see how ARC is actually good for the proliferation of USDC unless they think

that they have a better mousetrap with the end customer who now they actually don't control because Stripe has better control over them or you know whoever the actual uh other provider on the other end has better control. So it's it strikes me as very short-sighted in my mind because they don't have the same customer relationship that a lot of these other people do or Stripe does or anybody else who might launch an L1. Mantle is pioneering the blockchain for banking, a bold new category combining traditional finance with the power of web 3. With UR, the world's first onchain money app, users can manage fiat and crypto side by side using a Swiss IBON account in euro, US dollar, Swiss Frank, and RMBB, all posted to the blockchain. Backed by the Mantle

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offering the most secure and native way to extend Bitcoin's utility to DeFi. With Catria, developers can build scalable payment systems, tap into Bitcoin's liquidity with financial applications, and build privacy systems. Citria is currently on testnet and approaching mainet. To follow their progress, click the link in the show notes or follow them on X at Citria_XYZ. As always, investments in blockchain technology involve risk, terms, and conditions apply. Robin Andrews I don't know Sant if you have thoughts on this too. What switching gears from Circle what what do you guys think of Stripe? So, this was this was not announced, right? This uh Stripe basically posted a job. Uh I

think it was actually maybe the blockchain association posted a a job for uh Stripe, like a product person at Stripe um to go build uh this new this new blockchain that they're that they're building. And it's a collaboration between Stripe and Paradigm with supposedly Matt Matt Hong uh the one of the Paradigm founders as the CEO of this new blockchain. I forget the name. What's forget the name of it. Well, Matt's a force of nature. >> Tempo Matt like like like there are sometimes when you you know you talk about jockeyies or you talk about business models like he's a force of nature and if there's someone who can kind of shoe jam this thing in it's it's someone like him. Uh that said uh liquidity begets liquidity and I think

that you know maybe all of this stuff the the who cares about the blockchain in the end and it should just all be sitting at the app layer. uh and you know to that point they already have their network effect and they already have their clientele and I don't know you know who Stripe is a portfolio company of like if it's Andre's or Sequoas or whoever and then basically you can kind of finagle that around to all the other portfolio companies and then bully bully them into using I mean like kind of Silicon Valley San Hill Road 101 where you can kind of just bulldoze those kind of network effects out the gate. Um, but you know, we'll see. But but again, like operating it's

like operating infrastructure. It's like it's it's kind of a non-event in my opinion except we're all in the blockchain ecosystem. So I guess that's you know talkw worthy. But you know to to to you Block Works's point about you know infrastructure fatigue and show me the apps like really no one should care, right? It should just work at the application layer. >> Yeah. >> I mean, Strip's clearly in a a better position here. Like the I wrote this post a couple of months ago uh before I had heard this was happening, although it's been written for a little bit of time. And basically talking about like in many ways, if you looked at what Stripe was doing, it looked like they were building a network, right? They

they acquired the orchestration layer in bridge. They acquired the account in uh privy. They um h issued their own stable coin. They had their own stable coin backed card uh you know issued through lead. And so they they were essentially already as a PSP replacing call it like the merchant acquirer and you know a lot of the the you know the gateway and author etc. And now they're essentially replacing the issuing bank as well. And theoretically, if they don't actually need, you know, a merchant to leave their their network if they're settling on their own execution environment, they they basically can be an endto-end payments product, right? They don't have to compete for block space. They don't have to, you know, worry about, you

know, an RPC falling over. Like, they don't have to worry about they can also, you know, decide to allow only certain types of transactions. And they can probably provide a fantastic customer experience if they own that layer. So for them, I actually think it makes total sense because now they have they have this mousetrap like we talked about before with all of these merchants and now they own the full stack and are able to build you call it the best product that they possibly can and get rid of like some of these like intermediaries, the issuer bank and the merchant bank and they really only need like call it the bank who holds their stable coin uh you know backing now >> which basically just in different words is s stripe owns the volume stripe owns the distribution circle doesn't right stripe owns the volumes it owns the

millions of merchants it owns It's got the license on and off ramps and circle doesn't own the end user. So >> yeah, if the we we say or you probably heard me say this before like we invest in a lot of stable coin businesses and I always tell people you have to do the hard thing, right? And being the middleware layer is not the hard thing. Owning the customer, owning the bare metal bank, like those are the hard things, right? And so if you're just trying to put a blockchain out there and you're just gonna say, "Hey, listen, like everybody come and, you know, put their their flow on my blockchain." and you're not doing any of the other things, then you're you're probably in a bad spot.

>> Yeah, >> Rob, this is why Tron is Tron. >> They actually did the hard things. >> That's right. >> Yeah. >> Yeah. You're completely right. >> You always went on distribution. >> Yeah, 100%. Um Andrew, thanks for coming on, man. Anything that we didn't talk in terms of the back to the DATs, anything that you think is important to cover with DATs that we didn't cover? I I I think to be v uh vigilant in ATM with respect to dilution. Uh I think that MSTR uh set a decent precedent on on uh understanding kind of where dilution occurs and uh I think that uh we'll see you know 6 months a year

from now uh the the actual metric isn't maybe the amount of the asset one has but the amount of asset per share. >> Yeah. Yeah. I I didn't even rob we had a nice tweet I could have pulled up during this conversation which is uh you said it seems like everyone in crypto is about to go through a tough lesson on what the term contingent liabilities means. >> Agreed. >> Yeah. Yeah. >> I have not heard enough talk about that until today. So, thank you Andrew. >> Yeah. >> Clean living. Clean living. >> Yeah. Great conversation, Andrew. Um we do content of the week, Andrew. So, I will ask Santi and Rob, but start thinking Santi, Rob, what do you guys got? I'm afraid what Rob's gonna say because last time he dropped a huge u huge bomb on us.

Listen, I've become the um I've become the the fiction guy, right? >> Did you watch your horror movie? >> Yeah, it was good. Go see it. Weapons. Uh I enjoyed it. So, >> did you pay a million to get killed on screen or whatever your weird? I haven't done that yet, but uh if if anybody's listening, I'm I'm happy to to get killed in your horror movie. >> I've got one. I I listen to a good podcast. There's a um actually talking about Stripe. Uh uh what's not Patrick's name? John John Collison launched a podcast called Cheeky Pint Pints where he basically just has like a Guinness with like different founders and stuff like that. Um and different different people and he had Vlad Tennv on and people who >> Oh, cool.

>> probably are sick of hearing me talk about Robin Hood because I think it's a great business. But um uh I think one of the best investing strategies right now is just picking really when there's so much noise and hype is just actually spending a lot of time with founders. And if you don't know the person in person, you can listen to a lot of their podcasts. You'll see themes show up over and over again. So I thought yeah, I would go if you if you're interested in Robin Hood, I'd go listen to Vlad on this Cheeky Cheeky Pines podcast. Um and it was also amazing how much of the conversation it was probably a 70minute episode. How much of it was dominated by crypto prediction markets on moving on chain tokenization it's like 70-minute episode probably 45 minutes about crypto so it just shows this is founder Robin Hood

founder Stripe >> you're all about disclosures now what percentage of your book is Hood >> Hood is now my largest >> shock or yeah yeah >> so I got one for you >> go for it >> I got one for you uh so so back in the day 20 years ago does Anyone remember Angels and Demons or the Da Vinci Code Brown? >> Of course. >> So, there's a new one out called Origin and it's about the origin of humanity. Uh and and you know, each one of these take place in different cool parts of the world. You remember the the the Da Vinci was in the Louv in Paris. Uh and this is all through Barcelona and Madrid. So, it's it's kind of like

Spanish themed and uh it's it's awesome. Uh, so, so it's it's kind of a throwback, but it's >> it's a it's a Dan Brown book. >> Yeah. Yeah. Dan Brown origin. Highly recommend it. >> Great. Love that. Dan, he they're those books are so good. >> They're great. It's it it like and it it's kind of mind candy if you know dealing with like an S4 registration process like you don't want to shoot yourself and and then like this kind of puts me into like a whole different world and uh it's really really cool. >> Yeah, 100%. So that's great. Rob Santi, you got anything?

>> So, uh, since I'm the fiction guy, well, I guess Andrew is helping me out here, but, uh, I there's a a show I've been watching on Netflix called Family Families Like Ours, which is actually in Danish, so um you have to like like subtitles if you're an English speaker, but basically there's like this climate change disaster and then um like Denmark decides to uh essentially like expand the country and people have to like be assigned to new countries and there's a it's a a miniseries. There's like a lot of social commentary. Um, it's just I don't know. I think pretty interesting.

So, if you're looking for something and you don't mind subtitles or you're you speak Danish, uh, Netflix families like ours, >> all the Danish Empire listeners, great great wreck. >> Yeah. >> So, I believe I mentioned this in the pod before, but I think it's appropriate for this discussion and where we are in the cycle. Uh, the book is called uh, The Missing Billionaires, a guide to better financial decisions. Funny enough, it's it's written by this guy um J Victor who was a principal of long-term capital management. Super >> all about sizing.

>> It's all about sizing your bets. >> Yep. >> Exactly. He he starts off by saying look most of the billionaires um like if you go back to like I think it's like 1980 or 1970 mo 1980 most of those billionaires back then are no longer billionaires and so it's actually this idea that you probably heard it which is making money is not as hard as preserving it and I think a lot of that as Andrew uh alluded to comes down to position sizing and again I've said it time and time again with dads it's It would suck if you're long an asset like Ethereum and you pick a DAT that blows up and you know you got the thesis right but the structure wrong and structure oftentimes is equally or more

important and you never want to increase like why introduce more surface area to an asset class that can deliver venture-like returns. Most people I think would be better off you know if you can buy it in Coinbase go buy it in Coinbase. C can I ask a question to end this podcast since S since Andrew said it's all about sizing? Andrew, when you learned about Ethereum and the Ethereum ICO happened, how much of your net worth did you put into Ethereum then? >> Decent amount. Uh, let's call it 30%. >> Okay.

>> Oh god. >> Got to put your money where your mouth is. >> Yeah. To be to be fair, Rob, I think what you're getting at is most of the of the wealth like real wealth gets created through concentration and you should then snap out of that and do diversification which is which is so hard because you then say like for me it was over 90% of my net worth was in crypto at one point >> like like put all my bonus at JP Morgan into this thing and was like yolo. >> Yeah. >> Shouldn't ever do that. No one should ever do that. Well, well, and and interesting, you know, you're you're raising this point like uh a few people asked, well, it's like, so is this your exit strategy? And like I don't think some of planet Earth realizes uh I'm

probably the one who can't sell out of this vehicle more than anybody, right? >> Yeah. You're the one who's stuck. >> Yeah. Yeah. But that and that's why you got to put your money where your mouth is. And >> it's all about sizing. >> Yeah, indeed. Well, Andrew, thanks. Uh thanks for the thanks for uh coming on. Congrats on everything and um yeah, >> don't congratulate me yet. All the work's just about to start. >> Congrats on getting it going. First step is the hardest. >> Fair enough. Fair enough. >> All right, guys. Appreciate it. >> Godspeed. Cheers. [Music]