Hivemind: Circle Valuation, Pump.Fun Token & What We’re Bullish

Transcript

everyone recently all they've been talking about is Circle. You were saying Duncan last episode, credit to you, that 5 billion seems cheap. Um, what's it what's it trading at now? Like market cap wise, it's around like 21 or something. It's actually 26.8 right now. I'm not saying this valuation necessarily makes sense, but I'm thinking like this is like the easiest story to tell. The TAM is like all US dollars and like super sticky business like for the rest of time. Nothing said on the hive mind is a recommendation to buy or sell securities or tokens. This podcast is strictly forformational purposes only and any views expressed by anyone on the show are solely our own opinions, not financial advice.

[Music] Hi everyone and welcome to another episode of the Hivemind podcast. The goal of the podcast is provide an inside look into what what what we like to call the deli hive mind. Bringing together some of our brightest minds from each of the divisions to share insights, alpha and [ __ ] posts. Today with us we have the usual cast. Cedus Parabus heads up our institutional research arm. Uh Jan Lieberman, managing partner of Delphi Ventures and venture partner Duncan, also known as Flood Capital. I lead Deli Labs, our protocol R&D focused on incubating and accelerating new web primitives. And my name is Jose. I realize I didn't say my name there. Um,

yeah, back today. Markets are green, coins are up. Maybe we can start with that. How's everyone feeling about about markets here? What's the most important stuff that's been that's been happening? You had a lot of positive developments very recently, right? He had uh yesterday the Bloomberg article came out saying that they think so ETF is happening in three to five weeks. Uh you had the Trump Telegraph moment for the cell ETF potentially. Uh although much on it it it not an insane amount but I think it's a little less certain than the Telegraph moment was and it's still like a bit of a ways away. Uh we

can chat about that though definitely just like SoulPier. Um you have uh seems like resolution uh to the China tariff situation which you know you have this the July 9th deadline but realistically the one that really matters is is the deal with China and so it seems like that that's moving along well and then you had the soft inflation print today too which opens the door for some dovish Fed action. Um, so yes. Wait, when did the Trump El be Elon stuff? Well, that was last week when they Yeah. Yeah. Because I feel like the big signal from all that stuff was like, okay, they basically like gave

up on trying to cut deficits and like do um like be like fiscally respons. That happened I think well before that though. I know. But I think that's like the escalation of like okay, we can't really do this. it's not politically feasible and now we're going to like switch to like grow our way out of things. I feel like that's probably the biggest catalyst. It's like if deficits are just going to get bigger and we're going to want to grow our way out of things like that's like the over that's like the big wave that's pushing everything higher over like the next few years if they're going to be running you know 2.53 trillion dollar deficits then and then also like um you know Germany, China, Canada have all kind of switched into you know deficit mode as well. So

if all these banks, central banks all around the world are going to be running massive deficits for the foreseeable future, that's just like a big wave for crypto and markets. Yeah, I do think like the the animosity from Elon on Trump was kind of misdirected in the sense that I think Trump's hands were a bit tied, right? He had the the tax cuts that that he put in place in the previous ad in his previous term, they were about to expire. And so if those expired, you you'd get big tax raises across the board, which would be pretty bad, right? We're um and and so at the same time, uh it's really hard to get anything through Congress with it

being this divided and Dems only voting one way and and you basically needed every Republican to get on board in order to get get it through. So if you had a few defectors, then it wouldn't go through and and you'd likely have defectors if you put in some big spending cuts. So yeah, in order to kind of get the tax cuts through or or to keep them in place, you you had to uh you know, make concessions on on spending reductions. And so I think that's just kind of the the nature of the uh the beast in terms of our political system. Yeah. I'm not making a comment specifically on that. It's just like in if there was anyone to do it, it would have been like this administration like kind of now and instead it's like not happening. So, we're probably just

going into more deficits for the foreseeable future. Cutting cutting would have realistically was never really going to be that feasible because you'd have to cut so much like you you have to grow your way out of this, right? And so, I do think that's really the only way to do it. And um with the amount of just capex spending you're seeing on AI, it seems like it like if there's at the same in the same way that the administration this administration would be the only way to do it. AI is actually the only real way to to grow the economy at I wonder if it's like AI, robotics, and like nuclear could grow our way out of this. I don't know how much work like anyone if anyone's done a

ton of work on that, but you essentially need a productivity miracle. And it seems like those three things could potentially provide. Yeah, nuclear just seems too far away with the amount of red tape involved based on kind of like yeah, everyone who's in who's knowledgeable. I'm not this isn't my insight. This is just like it takes a long time to build the plan and everything. It's just if if I think if we get more productivity, the government will just spend more. Yeah. I I I don't think that this is actually a catalyst because I don't think people really ever expected Like well well the latest announce like they did I think I think they did but people Marcus derisked ahead of you know Trump like Elon saying he wanted to cut 500B and

then Lutnik wanted to bring another or was it 1 trillion and 1 trillion 500 a few months ago it was like look at what happened in Q1. Yeah. A few months ago it was literally like we're going into a [ __ ] massive recession. Yeah. Yeah. Yeah. But I'm saying now I'm saying now this isn't a like it kind of the market realized this over the past couple months. It wasn't some like random event. They legitimately I think they gave it a try like we're going to potentially pursue austerity and then they're like h never mind. This bill was the nail in the coffin though, right? It was it went from you know a a directional understanding of this is how we need to go to an actually implementation like an actual implementation showing that this is the

way we're going to go kind of gave certainty to the grow out for yeah Elon seemed Elon's like to like he got spent 300 billion or whatever whatever it was getting not 300 billion how much did he spend getting Trump elected 50 million or something 300 million that's that's the right order of magnitude um something like that and then He and then you like I think that's the wrong calculus. The the calculus is basically how much would he have lost if Kabla won and that's the true expense. The difference between that loss and 300 for money. I don't think he did any of this for money. No, I don't think so either.

None of this he's not firing off tweets hemorrhaging 300 billion of markets in a day on Tesla. He's probably ketamined out firing off tweets. But but the latest like the he apologized though today, right? He he he was like I regret my my words last week which fair enough. Probably too late. I don't know. Let's see. I think people will forget. Yeah. I think will Trump forget though. That's really the only person that needs that he's worried about forgetting or not. Trump's been pretty civil. Like compared to what I would expect after someone accusing him of like potentially being a pedophile, I would have expected more.

Yeah, it's in terms of his bullish emotional control. Bullish. Yeah, he's definitely got more emotional control than Elon. Like significantly more, which I did not expect. Yeah, we can move to I think. Okay. Yeah, let's do markets. Wait, wait, wait. Last thing about because this is interesting if like long term the last time the US was in this situation was like after World War II when they had like this level of debt uh to GDP and what they did is they they did yield curve control. So they capped the 10-year interest rate at like two um 2.75% and then like the short end at at something a bit lower than that.

Then they did like these massive infrastructure spending bills and they had you know inflation of like 5 to 10% a year plus you know five to six% GDP growth a year and then they were able to like delever out of their massive deposition over like five six years but like they had like a lot of of growth there. So like that's like the playbook in terms of growing your way out of it. You need to like put some sort of cap on yields spend and like you know ramp there's also like 30% inflation over three years. Yeah. After that. Yeah.

That that's what I said. It was like 5 to 10% inflation a year for like 5 years and 5 to 6% GDP growth and they capped yields. So it's like could we get that level of GDP growth like through AI and robotics maybe and then you just kind of soak five five to 10% inflation. It's like potentially it could happen. I I don't know, but that's like the only realistic solution out of it. It seems like yuric control is a lot easier when you have a smaller debt load, though. Like it's it's going to be a much harder thing to manage. Like they don't have the Fed just puts the infinite bid in at like five 5% on 10 years or whatever.

It's also like just easier to get out of like treasuries and dollars than it used to be. I I just feel like it could be a lot there could be an actual exodus if if if they if they try something like this. I think it needs it does need to be paired with like capital controls, but I also think capital controls are just harder now. I I'm I'm it was interesting the view of like uh I forget what it was. It might have been like Stephen like the the Trump economic adviser. Is it Steven Moran about like capital controls on US treasuries and stuff like this like foreign ownership of of of treasuries just like clipping a fee on that? Um yeah, like putting a tax on it. Yeah. I don't know if that's going to go through. There's been a lot of push back cuz that's going to that

impact I mean like Duncan that would impact us you know. Yeah. No, they're not in an easy situation but if you look at over the next 5 to 10 years it's like how does this resolve itself? It's like you pro you need some you need their growth or inflation like austerity is like off the table. I think eventually the US is going to mint the coin. Like I think this happens at some point. I think they just they just pump gold because then everyone can kind of agree globally they're like, "Okay, let's let's take gold to 20,000 an ounce or if you can issue some like giga long-term debt."

Yeah. And make the banks own it. Yeah. Like force them to buy it. Yeah. The other thing is QE through the banks. You basically just like they did this during CO for a bit. You basically like lower the reserve requirement for the banks and then the banks just kind of like sneakily sneakily buy all the debt. I think that's the easiest one. That's the one Hearth keeps talking about, right? As well. Yeah. It's like inflationary for assets either way and probably for the real economy. Yeah. PTJ just came out. Yeah. He he spoke today. Um he was just basically saying he thinks inflation is going to creep up and the long end of the the the curve is going to blow out.

Yeah. It's hard to see the the thing is in uh like 2021 part of why I didn't get bearish enough or really bearish at all is because this is like what I always thought the inevitability is like this is the only way out of all this quit games. But then there was like but then there was like a one-year period. NFTTS are the way out. There was like a there was like a one-year period where we actually just went hard to like kill inflation everything, right? But it does just feel like that's the natural only really.

I don't know. It's hard to see any other path for the world at this point. Well, that was it. Like the Fed tried and then they had the government. You basically need in order to tackle this, you need the Fed and Treasury to work together in some sort of way, right? And the Fed tried to kill inflation with rates and like the Treasury like fought back by issuing more bills and stuff. And now like, you know, I don't know what's going to happen with whoever is elected next as the Fed chair. But I don't think the government has the political will to try and like Congress and and the Treasury has a political will to try and like uh do austerity.

Yeah. All right. Should we move to do you want to talk about Circle IPO first or Pump? I feel like Circle is relevant to what we're discussing here. Like that was crazy, right? You were saying Duncan last episode, credit to you that five billion seems cheap. Um, what's it what's it trading at now? Like market cap wise? It's around like 21 or something. 21 bill. Well, because I looked at I looked at Athena. Athena was 5 billion FTV. I'm like, this doesn't make any [ __ ] sense. One of these is completely wrong. It's actually 26.8 right now.

Wow. Yeah. It's trading on like insane forward earnings. And if Fed rate if Fed cuts rates like bye-bye to like a quarter of their revenue. I know. But you I just think if you think about like their long-term positioning, I'm not saying this valuation necessarily makes sense, but I'm thinking like this is like the easiest story to tell. The TAM is like all US dollars and like super sticky business like for the rest of time. And it's like, yeah, but like the second you look, you know, you take a step beyond that, you're just like, this makes no sense at this foul. Even we looked at I looked at the contract. It's like so they signed that contract with Coinbase on on the interest sharing um in August 2023, which lasts for 3 years,

and then like they have the option to renew it or resign it. But it's like if you look beyond that, like if they get to a certain point where they don't necessarily need that or they have more leverage over Coinbase, like I can't I don't think you can like discount like what their future earnings could be if they can renegotiate some of these like growth spends that they I mean it trades at over 110 earnings for essentially what is a bank that 25 billion and like like the lamest part of the bank too. I think that this is just honestly like I was talking to Jordan about this who runs our DeFi arm and his wife works I don't know some Tradfi thing and whenever he's at these events he's like the crypto guy people know right and they always ask him about like XRP and

stuff right all these Trady people like trify people just [ __ ] love XRP for some reason and everyone recently all they've been talking about is circle and I think it's just like I you compare Circle to XRP P like one is like the TAM is literally the entire US dollar. Like there's it's a hu it's such a big vision I feel like and so obvious the way to get there and like I think it's more a reflection of just retail appetite on equity side. I mean the float's pretty low too I think right on circle yeah is expensive but I'm just saying like I can see why people are so excited about it. I think TRFI needs to go through high flow. high FTV, low

float. It's just if rates go down, something like circle just gets gets crushed. Whereas I think Athena just benefits a lot. Like I think the the Athena yield is like will go up. We might have different time horizons on this. Like if Circle keeps on growing over the next 50 years. It's like so huge and it has a good position. Yeah. But like it's good to see it's good to see people buy buying this, right? Like sure it'd be better if it went to our our alt bags, but like there's there is appetite for you know the stable coin narrative is real. People want to people want to ape it. And so yeah, it's good to see demand. It's good to see the demand.

I think it's just a and it's it's I guess a a supporting argument for what's the trend that's already been happening, which is basically people in crypto trying to exit on equity retail instead of crypto retail because crypto retail got destroyed and now it's like let's wrap our stuff in equities and exit on them business. I mean, sure, it's a real business, but like it doesn't make it shouldn't it's not at this valuation. Yeah, I think this is expensive, but like there's a path there's a path to getting there, whereas some of this other [ __ ] in crypto that launches like there's talk about how bad of a job these bankers did pricing this just they were just they

were doing the crypto play. That's green candles in the beginning. Like they ran the hyperlquid playwalk, but their job is to get a good exit. Yeah. Yeah. You want a pop, but you don't want a 4x. You want like a 20 30% pop. You don't want like a 4x is insane. I think that the other interesting thing is like now with this with this treasure, it's like for for ages um you had like normal companies with shares. They saw they issued a token because they saw it as like oh well we'll issue like a valueless token and just shill it to these like crypto tards and and get some more get some more value out of them.

And I'm kind of seeing the reverse trend now where a bunch of crypto companies are like, "Let me wrap this token in an equity vehicle or like a NASDAQ ticker and do this Treasury play and basically like sell my my token to these to these stock market retards that want exposure. You're talking about the but most of these treasury plays. It's really interesting. I think I think it's an interesting structure too. Like Miles Jennings wrote that article about the end of the foundation. Um, I'm seeing like spoke to one this week like a labs entity that is basically uh trying to take effectively take their labs entity public like whatever cash flow sources they have use them to buy the token and then just take all the tokens on balance sheet and issue equity against them and buy more tokens with it. And like I

think it's interesting because you have the token as the primary value capture vehicle and you just have this this equity entity that just serves to allow you to reach another market with your for your token, right? Um I think it's a pretty interesting structure, but it's like such a reversal of historically what how how people thought about tokens and equity that it's just funny to me. Yeah. I still think a lot of these like a lot of these new shares and stuff haven't come online and like this meta might end but maybe not like this meta might end quicker than we think but maybe not. It's good for tokens honestly like yeah no I I definitely it's definitely a concern that it ends but I think the the

the the interest around circle it'll be interesting to see if it's in like if that's cryptoreated if that's purely stablecoin related. um you kind of need a bigger sample size to start to isolate the drivers because just like you can explain stable coins to like try five people and they're like wow this is a good idea. Nobody doesn't think stable coins are a good idea. The biggest risk to stable coins, I think, is like they kind of put the banking sector at risk because basically like they're just a better way to like send and deposit money, but they directly own the treasury bill and like if they start flowing through on a yield, then who the hell is going to deposit at a bank with like 0% interest

rates? Like that's the biggest risk doesn't I know, but I'm saying if they do, then they'll be even lower revenue business. or lower income like this doesn't make sense. Doesn't Robin Hood do it. Yeah, but they're like that's probably more of a customer acquisition strategy, right? Like their their business is trading so like they're just going to get you to do anything the US yield, right? Yeah. But that like that that's just user acquisition, right? Like keep your money on our platform where you definitely won't gamble it. But I think that that's probably the bigger risk to like the banks and circle and stuff is like someone doing that and then that creates I don't know what happens in that

scenario because you like start undermining the banking system. Yeah. I mean I think it's inevitable like the pull of stable coins. So like what even would the bank circle is like is just the banking system. H how does the banking model even work if the because basically right now you deposit in your checking account you earn like nothing then the bank is going and lending out that money either as treasuries or like you know loans and so they're they're making that spread which is like a massive part of their business. Now, if there's all these easier products to to for the user to essentially capture that spread, does that just like put the whole system at risk? Because those

banks like they they make loans to kind of fuel the economy. Well, they make like saying it's like the the the least interesting part of a bank because banks take on duration risk, right? They're not just going out and and throwing the stuff in in six-month bills. It's they have a variety of stuff that they lend out at higher yield so they're actually able to capture a higher uh net interest margin and then they have you know uh investment banking services and kind of other stuff. And so um this is just like the the most boring um most risk rate uh interest rate sensitive part of the bank. But it's also kind of the most important for the economy. It's like the

most important role of a bank for in in terms of what it does in the economy. Like so people have been trying to get people have been trying to get retail uh bank accounts at the Fed for years that would tra pay pay interest. And the reason why they haven't done this is because it puts the banking system at risk because everybody now gets Fed interest rate in their checking account. And that's the only reason why they've never actually approved this even though it would be like a lot better for the average person um is because it would could literally blow up the banking sector. So I think like yeah there's a lot of truth to what Duncan's saying here. Um the banking sector's got it's just going

to change a lot like yeah and then the other force is like oh well the government at the same time is like this is a huge demand for our debt. So, it's like there's two pretty big opposing forces fighting here. I'm just curious how it ends up playing out. Um, I mean, just got tree news. Bank of America CEO says bank is working on stable coin. Yeah. No, I mean, everyone, we're all in the same campus. Stable coins are going to be a much larger size in the future. But I do think it's an interesting uh point Duncan brings up like this this conflict between the US wanting people to buy treasuries to finance itself but also the banking system and the entire economy being dependent on credit from the banks which in turn is dependent on this scam that you can put your money in

the bank and it's like a deposit but actually your money's not there. It's being loaned out for free and you're not getting anything for it. And like if that kind of illusion scam like disappears, people just hold stable coins. Um then how do you have credit flow through the you just have to have like an a basically on top, right? Like an an a but but like or a Maple maybe is the better example. A Maple type thing where you're there is banks built on top of the stable coin system and you can choose to selectively lend to them, but it's just not going to be the same rates, right? Like cuz because banks get capital for free from all these depositors that that think it's just the banks are just going to be way like worse as businesses and maybe lend less

which like could be bad for the economy, right? Because their their margins are just going to get chopped in half. Like what Yan said is like they're not just lending to the Treasury on like whatever three month risk-free like they're going a step beyond that. They're doing like loans to businesses and stuff. So like their margins are just going to compress significantly and they'll only earn the spread over like treasury versus what they lend out on like a multi-year loan. No, I mean like that that's part of what like they manage is their liquidity, right? So I think they'll always continue to do that. Yeah. I'm saying they're going to have to do that more because the right the like there's going to be these alternative stable coins.

Anyways, it's an interesting thing to think about, which is actually stimulative though in that sense if they're if they're going out and lending to the economy rather than to the government, but they have less to lend, right? If this if if everyone's using stable coins, they they like rates their margins will just shrink like money in the system literally money is created by loans, right? And so it literally just shrinks the entire economy if you get too much of this. Like this is how money is created by commercial banks, right? Loaning out. That's literally how money is created. And so if what Morad watch videos.

So yeah, it would be pretty it would be pretty. The key is to buy SPX 6900 69,000 or what is it? This guy really just has like honestly meme this thing way back up. Did he say don't you own some? Aren't you Aren't you an AON believer? I own some. Yeah. Yeah. Um, nice. So, should we talk about Pump? We We all I mean, if we're on stable coins, plasma, like what do we think? Obviously, it seems like So, they had this, you know, pre-launch contract thing where you're farming points to like get an allocation. They got someone paid 100k in ETH to get into that thing.

Yeah. Yeah. Maybe we want to describe how this how the how the how the whole system works like Yeah. It's like you deposit you deposit stable. Maybe actually Yon can explain it more because I don't know all the lockups and everything. Yeah. Yeah. The idea is basically it you deposit stables to earn points a share of these points that are issued and then depending on how many points you get that determines how much allot you get. So you know in simple sense if you deposit if you're 1% of the capital that's deposited then you get to buy 1% of the allocation in the end you get to withdraw the cash but it it it just gives you the right to buy into the round. So basically it's kind of a whale game, right? Where it it's you need to

have a lot of liquidity to have the privilege of participating in the round, which I think is kind of counter to what these platforms are designed to do, which is open up the investment landscape to retail participants that were otherwise locked out. It's also silly because well in in my opinion it's just like you have so you put in stables in this pre-eposit period then there's the ICO where you get points based on yeah how many stables you put in PR rata which is going to be a whale game and then everything gets converted whatever stables you put in get converted to tether and locked for for 40 days. Um but then at the end they used on the chain or anything or like what are they

used for? Um no I think I think a is launching on the chain right now. All the deposits are in are in a I think so. So they're earning earning yield. I think a is going to launch on the chain. So maybe they get they get put there. They do give but yeah they get migrated but after the 40 days what do you like people are just going to if there's nothing to do there with your stables people are probably just going to pull out right. I don't I I guess I don't know why this makes more sense than a traditional points targeted point system where you can say you get points for using the main money market you get points for using this for payments or whatever. like why do this? Well, in those scenarios, points are usually just a marker to get air dropped, right? This

is you're getting so because you're buying it has to be in a more structured KYC jurisdictional way, right? They have to do it to European or or rather non-Americans and so if it was an airdrop, sure you could do it that way, but this is the right to buy and and so they need to follow regulatory um kind of regulations. But you could do points for right to buy and just have a longer like points campaign with more more activities and and stuff like this. But isn't Yeah, but they they don't not selling it to Americans. So like you have to do it. They are selling it to Americans. Oh, with a locker lock up.

Yeah. Yeah. Well, so you still need this KYC system. So it like unless you want to they could do something where you link wallets to your account, right? You earn points over time and then you link your wallet to the to the account on the platform and and do it that way. So you still have the the gating. What's the main purpose of the chain? Is it for DeFi or for payments? Like I feel like a lot of people have said payments. I think they basically all the activity that Tron is doing and saying that's the goal.

Um I mean it's like a a shorthand way of thinking about it. So I guess yeah it's like how do you incentivize like people using like whatever the zero fee is what I'm understand yeah exchanges will probably just move over because it's zero fee pretty easy for them to do that do we know what kind of Although how's this how's this not just going to be spammed to death there's like a lot of unanswered questions with this yeah I don't get how the gasless transfers don't get spammed to death Um, yeah. There's And do we know what chain it is? Have they Have they said is it a layer 2 or its own chain or is it EVM? I guess it is. Uh, it's uh it's EVM. It's Dude, read the report we wrote. EVM.

It's like it uses like uh like like a derivative of hot stuff. Yeah. Okay. What's hot? One. It's like a consensus consensus mechanism. Okay. It's like Cosmos type. TV um turbine. We're telling to explain when he just throws out these random [ __ ] words assuming you understand what I mean. No, it's it's a hot stuff. What the [ __ ] is hot stuff? It's like this. It's like this fast consensus mechanism, but it's like Yeah, that's all you really need to know. Hot potato. It's an 01.

It's an 01 with EVM. Yeah. Uh we want to move on. I mean that's I mean what do you think plasma so you're going to buy the token at 500 circle is trading at 20 bill so I cheap now now yeah so I mean plasma we'll see what's interesting is that L1's have really the L1 premiums definitely going away that's what I was going to go um a lot of L1s and like you look at a lot of these L1's that people don't really use and they're all like less than two build now and I mean I know that still sounds like a lot of money and it is but you used to have these L1s that nobody used trading like five plus for a long time.

Um you know like in like I won't name a bunch but like there's there's a lot of L1s now within that even like sometimes less than a bill range. So the the narrative there hype could what? Hype kind of I think hurt the L1 premium narrative because it's like this massive people are using this. Yeah. It's like this actually generates cash. I feel a lot more comfortable putting money in this asset. I think that would kill it all together is if Pump Fund then launched its own chain. Um which I think is inevitable eventually. Yeah. eventually and then like Dell one premium really well which is what the cosmos the cosmos people

were right again they're just poor they're uh they're not really right though I think that's cope for and like people just go along with it to make them feel better for like not being right for years I think like pump launching its own chain maybe like at the very end when they want to squeeze out like the the small remaining juice but pump launching their own chain right now is quite dumb and like a colossal waste of engineering effort and time. Um, and there's like, and we can talk about the pump launch, like there's no way that like this billion dollars they're raising, I don't see how any of that anytime soon is going to go into actually building infrastructure for building their own chain. It's just going to go for like growing the pump brand more. Um,

it's a pretty big raise. Like yeah, I would also be a buyer at four billion of this of this pump ICO at 4 billion. Yeah, four billion. I think it makes a lot of sense. It's good because it's everyone's unlocked, right? It creates a price four billion and then bearish circle five. No, I'm saying bearish circle at five. It's like Yeah, dude. Yeah, man. Interest rates go down. That's bad for circle, good for pump. I know. It's just like uh one's like I think technology the other's like Yeah, exactly. I wasn't bare circle at five.

I'm bare circle here. Um I wasn't like super bulked up at five circle at five. I wasn't bullish. No, I'm just a I'm a watcher at five but enjoy want to buy pump at four. It's just it's just funny because it's like when's a [ __ ] 100%. Well, so what what do they have right now is like a large user base and a huge audience. And so if you think they can expand beyond Well, I'm just saying like it's like [ __ ] like once I think if it fails it it it goes up quite a bit first because of how much they're raising, right? Like it's not it's fail over time. Isn't it Aren't they still making like a million a day? Yeah. Yeah. Like I think it could do well for sure.

I just interesting to see is like how I mean raising that much money is no easy feat, right? Like being valued at something is is is fine because you're just it's the marginal buyers. Yeah. You raise the billion and then you need like another good amount of money to take you to eight or whatever. I think it's a mis Yeah. I think it's I I I don't like hating on ambition, especially in crypto because not many people have it and raising a billion is super cool. They're going to do some It's cool. ambitious, but I do think like overfunding startups, especially in crypto, has like never gone well. It's it's just cuz you have to like right now they're really focused on a core product that's crushing it. They released streaming,

which I think is also doing pretty well. Um, and in startups generally, you just always want to raise like the the minimum amount that gets you to the next stage because in general, you want to be focused on one to two priorities, like do the most important thing. And if you have a lot of money, you have too much money to just do one or two things. So you have to do a bunch of them and then you start to do a bunch of them not so well. Like now you have to do acquisitions, you have to do marketing, you have to launch like four or five products at the same time. And I just struggle to see. I know the founders are really young and like right now it's it's a it's a relatively small team.

They're going to have to grow that. I just don't see why you would raise. I mean, I imagine a lot of this money is going towards marketing type stuff and just getting because that's kind of what the business is now. Like they're just trying to grow this brand and like crack out of the crypto. But they have like like 600 they probably have like 6700 million in treasury. Like what marketing do you want to do that you do do you need more than $600 million for? Like I I like what what do you need a billion dollars for on top of $600 million like stadiums like fun arena just like Super Bowl ad? Definitely not Top Signal. Pump Island. Maybe they just want to pay out

a big dividend and just secure the bag for life. And then they have the bag. They have the bag. Yeah. But like really secure. I think they've just realized they can just try to make this the like the biggest [ __ ] product in the world. like consumer product. Um, just make this the biggest casino ever. The pump, but they could do that with 600 mil. I feel like I guess but like at the same time, what's like the why not? Why not? MGM or something. You can raise a bill. Why not? At this Yeah. Like there's a lot of reasons why not. I think there's Yeah.

But generally, if you can if you can get the money like it's not always going to be there. Mhm. Yeah. So, I I hear you on that. It's definitely it's a recipe for disaster in terms of, you know, being a little subpar in a lot of ways versus really focusing on a handful. But at the same time, there's a world where you don't spend it that aggressively, right? Which is very hard to do when you're that age. MGM is 9 billion. Yeah, I'll just I'll just go through like Caesars is five billion.

The biggest fundraising rounds in crypto ever as far as I remember. Uh it was EOS was the ICO which was like a couple billion dollars. No one knows exactly because they were recycling and stuff. It was FTX which raised 900 million. Um it was Forte which I don't know if anyone even remembers now that they they raised like 700 million. Uh it was so rare. Moonay um like these like raising a lot of money in crypto has not really gone well for anyone. Uh Moon Pay is doing pretty good now.

Are they? I think the difference is maybe that pump already has the product built and so they're just going to like be spending to literally for distribution and so maybe I mean they definitely need to expand beyond productwise beyond what they have. Yeah. Yeah. The pump casino it's coming to Vegas. I think I think the streaming is really that's like Yeah. really their goal here. I think a casino is a no-brainer move, right? A casino is is a pretty commoditized product and you compete on on advertising and and rewards programs.

And so if you already have this massive user base and you could strap on, hey, come lose your money over here as well. I don't know. We're so I think it has I think the illusion of being able to win is better on I think Pump's a better casino than than doing Yeah. It's just a different thing. Like I I think you're just inclined to dabble here at the same time. Like the casino business is monstrous. I was just looking at I said MGM is 9 billion. Win is 9 billion. Caesars is like six billion. Like they could be like one of the biggest like a Gen Z casino.

Robin Hood billion. I don't know. It's interesting. I'm I'm I'm yeah it's going to be it's and and and also like maybe following on from this a lot of people have been saying how this is bearish for Salana right soul's been underperforming I think it was down like 30 something% versus ETH over over over a month um and I guess the arguments for that is that this is the main application on Salana the main source of of of fees and so now people have a more direct way to bet on it than than owning soul Um, what do you guys think of this in general? Like it's true to an extent like the more it's like the same thing

with ETH and all the L2s and everything. You have all these other tokens that kind of suck up capital. Um, and in the Pump instance, yeah, Pump makes Solana makes a decent amount from Pump um through like Geotips and everything, but Pump still makes more. and if they're actually going to pay out, which it seems like they're going to distribute some revenue. Um, definitely take some capital away, but at the same time, like your goal as an L1 is to create valuable apps. And so it's like it's just kind of the reality of sure in like a vacuum here this may be a bit ne negative for soul flows and for the price of soul but over the long

term you have to these are like bad these are good problems to have that you have successful apps that want to that are going to be worth billions of dollars right so like you can't have all the value just flow to to soul you have to have the apps on Salana make more than the soul token make in aggregate. Right. Well, so the bearish the other bearish argument is basically that they're just like constantly market selling soul, right? And so but it is an issue but it's not because in the grand scheme of things like flows should be able to offset it. I think the other reason it's shortterm uh has been a drag is because they are

going to raise some of this money through soul. So people are also selling soul and are anticipating more soul selling as part of this raise. So I think soul bottoms around this sale because you've you people have known it's it's been coming, right? So Trump happened. If you look at like what happened with Trump, right? Soul ripped because that was the only way to buy Trump and and so it ripped and then it dumped as everyone sold sold for Trump. Here it's less of a surprise. It's been known. So I think it's it's created this longer more yeah dragged out drag on price and and so I think you kind of have the final source of weakness from this raise where you know both people

selling soul to participate in the raise and then people committing uh soul into the raise and then them selling the soul. So I think like that's going to be kind of the final source of it and then you maybe rip into ETF from there. I mean if this pump ICO if this billion if they actually raise this and it raises quickly I just feel like Soul is going to rip so hard after that because it's kind of like okay plus it's users coming to Soul right like this is they're not going to launch their own chain for a while and so you want users in the end because you want these users to make all your other apps valuable and you create the the snowball effect. But like yeah, I I I don't know. I I agree uh as I mean I'm I'm bullish I'm bullish

so um and I'm I'm bullish so here actually. But as an L1, you want to have successful apps. You don't want to have one successful app. And that's that's been the killer of many ecosystems in crypto, right? when the successful app moves off whether it's um like arbitum and hyperlquid like or or starkware and dydx uh sorry dydx and starkware or immutable like because the thing is pump doesn't really need salana actually like the the the composability benefits for pump are pretty limited especially now that they've built their own their own inbuilt decks like realistically uh and again I don't think it's as easy as this there's a lot of infer work that goes

into it I agree with cetus it won't be a priority short term, but if they launched a soul Salana fork with Phantom, they would have like a bunch of the users like just not even notice what had what had happened honestly like people would just bridge there very easily and like all the users are in because like as an L1 you want to have enough successful apps that depend on each other that there's a network effect that means apps want to stay with you. You don't want to have one successful app but the thing is now you need to keep now you need to keep money on pump chain. It's like when you have money on soul, it's Listen, I've never bought a [ __ ] Pumpco coin through the front end of Pump or like on the bonding curve. I'm like not in the trenches like

that. Okay. But 100% I own Pumpk like maybe. No, I don't right now. But like 100%. You got some fart. I don't I don't own fart right now. Was Goat a pumpkin? Pump pump. Yeah, goat was a pump coin. Um I've owned like a few pump coins and like I do it on goat, sir. Dude, goat. I don't even know what it's at these days. I'm not I'm not a morad man. I'm not just holding like Oh, that was the first AI coin. That was Yeah. And then the thesis got invalidated once like virtual and AI6 Z problem once it dumped. Well, no, once you had that no longer sentient. Yeah, it was no longer sentient. The price went down the fair.

It's like, yeah, but no, that's the thing is like the the the trenches are valuable because they can exit on all of the other liquidity. Yeah. Like they have me to buy meme coins at like nine plus figures and I'm not going to be there. Aggregates pumpchain. You're going to buy it anyway. Like it's it's it's it's knock effects though. Yeah. because it's like all right well now there's just yes some people will but less people will and now the game is less interesting because even though there is participation there's less and and that feeds on itself and it's like all right well and then you just have this kind of gradual capitulation so I think they need to get really big yeah I don't think I don't think it makes sense because yeah like Cedus is saying like

so on like there's all the pump gamblers who need like if anything's going to go really crazy like exit liquidity of people who like aren't sniping the Here's my main point with This this is like such a crypto researcher type thing to concern yourself with like should LA pump launch their own chain? It does not matter right now. Like they again have such a bigger market to take over than launching their own chain. It's a complete waste of time to like think about this. And yeah, one day I'm sure they'll launch their own chain one day. Like I'm sure they will. I'm sure they'll also just keep it everywhere else. Like Uniswap launched a chain.

They still are like the dominant AMM on Ethereum, right? So yeah, they'll just offer cheaper fees for people to use the pump fund on pump chain. They'll definitely keep it on. So yeah, I don't think there's actually been a good example of a really successful app leaving and like you know, sure like DYDX I mean maybe I guess like not really though. It's not like it was really beneficial for Ethereum. Yeah, it was beneficial for the Stark brand, the Starkware brand. Um, like but none of the all the most successful apps that Ethereum has ever had are still most successful on Ethereum. Um, I agree I agree that Salana needs more of a diverse I agree that Salon needs

more of a diverse revenue stream. Um, but having a major one successful helps improve those chances. Yeah. If you're going to launch an app, it's like, you know, oh, let's just do it on Salot. Yeah, probably doesn't make sense right now. Okay, guys, pull up the hyperlquid chart. This is insane. It's at like 44. Wild. Yeah, hype is hype is insane. It's literally straight up from the tariff stuff. Wild from April 7 bottomed.

Do you think because it's going to trade they're probably are they going to do an airdrop pump? I saw that some like a delayed one. Okay. Um, it's going to trade with a pretty big float, right? Like it's a 25%. Yeah, you should short it, man. Float. Do we I'm a buyer at four for sure. Do we think like underowned or is you think it's consensus now? It's kind of hard for me to tell. Hyperlid. Yeah. Um, because like their community is really loud, but I feel like people aren't really freaking out at like the fact it's at 44.

Uh, I don't know. Like I think everyone um I think it's consensus and has been for a while but everyone's underexposed to it. Like yeah it's going to go up but I don't own anything. And I say I say say that as someone who is probably wishes they'd sized it bigger. I think a lot of people are probably in around that camp of wishing they'd bought more probably probably a bunch of people don't own it like a bunch of the ETH people and stuff. Uh it's pretty like values opposed to them. So there's still bunch of rich people to buy, but I do think it's been pretty consensus like all year. Yeah, I don't think there's a good custody solution for it, right? Uh so funds based on just kind of the rules they need to follow. I'm sure many are

are not exposed as a result. I think that's that's in the process or has been fixed like now Fireblocks and those people are supporting it and stuff, but yeah, it was like that for a while for sure. I remember that. Yeah, I mean the HIP3 stuff is pretty bullish, right? Because now you kind of start to really open up the TAM for other builders to come on board and share fees. So yeah, you know, what are the use cases there that you think are like um additive rather than like parasitic for someone different markets? Uh incentives, people can shower incentives. Um, oh, Stripe is buying Privy.

Yeah, there we go. Crazy. Stable coins are really heating up. I'm so sick of talking about stable coins. [ __ ] Red. Give me some coins that go up. There's just no good token to buy for them other than maybe Athena, but it hasn't got yet. Well, I mean, yeah. Uh, is it going to go up, guys? Should I buy? Not financial advice. I think so. Are you buying more here?

Are you buying more post circle IPO? Yeah, I've been buying. Yeah, I did. Yeah. All right. Yeah. Always buying. Always bidding. I think HIP 3 is really bullish. Athena actually. Yeah. So, explain HIP 3. It's like if you launch an app on Hyperlquid, the fees that your application generates, they like send back to you, right? It's 50/50. They split 50/50. Yeah. So, they want to use the idea would be kind of using Athena or USD in the same way they do it on sexes. That's honestly such a clean way of doing this instead of all this app specific sequencing [ __ ] that people are like markets, right? If you launch, you can launch markets like pairs on on

Hyperlid. But I also think it's like the bots. They do this with like the trading bots on there and everything too, right? That generate like trading activity. Yeah, that's different. That's builder codes. That's Oh, that's builder codes. Okay. That's like kind of plug into the front end where you can like add your fees. This is like adding markets. Yeah. Yeah. a new pair like they'll have BTCUSD on like their per and then they'll have BTC Athena USD and I guess yeah it's like Athena can like in theory they could launch and obviously they have like Ethereum which is going to be live on converge like is a sort of exchange built on Athena but they can also like uh in theory like launch pairs on Hyperlid have them

listed on the front end and then they could do like um you know you could have yield earning collateral USD, Bitcoin, USD, ETH, USD, you know, like all the major pairs, which would be yeah, pretty dope. And also, you could have uh an HLP equivalent that's with USD, so you're earning that yield on top. That's cool. Like a vault. They can make the market. There we go. They don't even need Ethereal. Sorry, guys. We're going competition's always good. Yeah. I do think this builder codes thing that they do, which is a bit different, is honestly such a smart way to like give back some of the money cuz then you don't need to like worry about

all these other weird designs that you need to like introduce. You literally just, you know, we just take care of all the fees and then we just send back you a certain Yeah, it's a great way for frontends cuz it's like anyone can build a front end to like to have in a really good liquidity and like add some extra fees. This has existed for years in crypto though like a bunch of projects did this before like Thor Chain had this and yeah it's not I agree it's really smart but it's not the same thing as I think it is incentivizing people to run and get paid it's just not the scale not as good of a product yeah agree with that anything else people have been bullish on buying what

they did you know I'm in this group chat where they track his jet. He's been making a lot of flights. They're like, "Oh my god, he's going to the Google headquarters like or like he's landing near here. He could be going to see Google." Um, Galaxy Digital, I've tweeted about it a ton on my Twitter. Um, but basically they have they have two like very different businesses, but one like massive data center. So they have 800 megawws of power approved and 600 megawatts like contracted with coreweave which on like 15-year contracts which is going to earn them like it's only like 15 billion over 15 years. So that's pretty big. Um and then they're have 1.7

gawatts in the pipeline to get approved. Um which is like huge. If they build out this full data center 2.5 gawatts will be like one of the biggest or the biggest in the US. Obviously, it's going to take like probably five years to build it all out. And then they have this crypto business of like investment banking, asset management, uh, lending, um, staking, all these different crypto services, which like I think could be a really good acquisition target for like a Goldman Sachs or like a Black Rock. So, it's like you have two very different businesses. like maybe they'll, you know, spin out the the um the bit or the data center business, but they're basically like leveraging the balance sheet of like they own like two billion of crypto, two and a half

billion, and they're going to like leverage that balance sheet to like build out this this massive data center with so AI and crypto. What more could you ask for? All in one g the takers GLXY. What about you, Yan? Anything you've been looking at? Um, I mean, I've just, yeah, I've kind of just been sitting in BTC, hype, soul, you know, are my my biggest bags and and then like Fart has been my uh with like some small allocation to to Popcat. Uh, but yeah, thankfully Fart's been doing all right. Um and then yeah,

I think the the next big thing is just going to be figuring out what happens around this pump launch. Um and I guess yeah, how are people feeling about markets broadly here as we triple test? Uh we no such thing as triple test, right? Yeah, exactly. I mean, there's definitely some treasury bidding happening. It's just like this very clear T-W Coinbase premium thing going on. So, um you saw uh GameStop bought 500 mil which is bullish because they raised a lot more than that and um you're buying. Yeah,

it's crazy to me that they're buy these all these treasuries are buying so much and it's and it's not up more. It's a big asset. Yeah, it's $2 trillion. I saw somebody is doing gold. Jose, this this treasury meta has gone way too far though. Like I saw today somebody's doing a fat treasury fat. Yeah, the the AI token. Yeah. And I saw someone doing a tow one the other day. Yeah, tow it. It's just like this. It was like seven and a half million. I was like there's like 30 minutes of tow emissions that that buys.

I mean, every major asset is gonna is probably going to try and do this realistically and even and probably a lot of non n not major ones too. It's just if they keep on premium school will keep on doing it. It's like yeah, what are the ones that people think could actually get bid? Like what are the tokens that you think could actually bid? Hyper strategy because it's actually hard to buy. No sex holds it. That one could get a good bid. I agree. How do you think I don't know like the sole ETF if this actually goes live in like July or something is it going to impact the treasury plays?

Um I mean you need price to go up. I don't know how I mean I think it's bullish right? Um well it was bullish for Yeah. Well because micro so these guys aren't going to have the convertible debt stuff right? they're too small and there's less long-term conviction in in soul relative to BTC. So, they're going to have a more equity-like um raising process. And so, you I mean, you do need price to go up and that fuels the speculative side. Uh so, I I I think it's I think it's helpful. I don't know that it it you know, the law the the ETF is going to eat into the marginal buyer of someone who would be

buying one of these things. Um, I think this is more of the speculative side. So, I think net is bullish. You maybe like eats into the buyer a tiny bit, but I think they're just not that big where it's going to be fine. And so, you need those flows. Um, I guess what do people expect the Soul ETF to do? Probably good. Like I think it seems like there's more demand for soul than there is for ETH. It just had inflows recently. Yeah, ETH has had inflows.

It's also going to have staking though which is Yeah, that's just better design. And that that's also way more incentive for like these Asamanders to push it cuz like if there's 7% staking reward like they could probably clip like a fat fee on that. Yeah. I mean you can't stake all of it. you can only stake like half of it cuz you got to be you have to have liquidity for redemptions and stuff which is kind of the problem with the ETF structure but soul has a lot like soul you can stake more than an in you could insta unstake yeah so if they use there actually was that was going to use marinade and so there's there's ways to work around it this is the problem with this is the problem with the ETH what is like a token I haven't like totally looked into it as

much lately they did pivot pretty hard they were like first LST on Salana And then Gito kind of took that. Um, yeah, they have this whole I mean their product's kind of cool. It's like this n it's like an LST but it's native staking. So it's an LST in the sense that it's not liquid or anything but to tons of other people don't. How what how did they get instant unstaking and other people don't? I don't understand. Uh I think it's like their own liquidity fronting thing that they have where they have like a pool like you deposit to this pool liquidity and then Yeah. I don't know how it's exactly funded. Um, but that's basically what it is.

But that's one of the problem with the ETFs is that Ethon staking is uh it's actually impossible to kind of like predict. I mean, not like when you do it, you can predict it, but it's always variable and it takes like a long time and so you really can't stake a lot. Well, there's some Salana products on the market. There's two that I know of. one is like takes the full staking rate plus charges another 2% on top which is just like an insane rake and then the other one from coin shares SLNC I think gives you like a 3% yield no management fee so they're taking like four or like half the staking rate or more so it's like you know even if you were to get like for these products the

Bitcoin ETF's like 25 bips that a lot of these managers are taking if they do the staking rate 7% right now right Senzana something like that. Yeah. So like if they flow back 5% and they take two, it's like that's like they're making 10x more money per dollar on Salana. So I could see them pushing it a lot harder. Yeah. This is also part of why like I think a lot of people in Salana that SMD to reduce inflation, there's like this constant sell pressure on Salana that just comes from infrastructure providers that charge commission on stuff like this and are just selling soul constantly, right? Um I think like there is going to be another inflation reduction proposal that will eventually

get through. I think the other one was like a bit too complicated. Uh how close was it to get to getting through? It was decently close. Uh I mean the thing is with it like it had support from all the main stakeholders. Um but uh how much would have that one reduced inflation by? It would have reduced it like basically close to 0% pretty like quickly because um my staking bags because the yield was actually a decent like me and it's just really hard to get validators to approve that kind of stuff. Yeah. It's like hey the people who vote on this we're going to [ __ ] destroy your business. I think it's easier to do that once you

you cut spending. Yeah. I think once you take off um when they take out the onchain voting with Alpenlow whenever that goes live then there's kind of more room to do this too because now validators don't have that expense of like paying soul every single block. Um I mean that's going to be years they want to do it I yeah like my baseline is that it's going to be years but they're pretty adamant that like end of the year early next year which seems kind of insane to me. Um, but those are the timelines that they're talking about.

What happened to Fire Dancer by the way? Soon it's Well, it's on mainet. The The problem with Fire Dancer is that it doesn't have GTO integration. And so if you want to make me, which is like a big chunk of money, then you can't you don't really want to use Fire Dancer. That's kind of the issue with it right now. What's What's the adoption rate? Uh, it's like 2% or something like that on on mainet. Yeah. All right. Cool. Yeah, this is a good one. No taxes on geo tips in America. That would be that would be that would be bullish for Salana.

Would that finally make you move? Well, I'm not a validator, so maybe set one up. This one really mattered. All right, guys. Good episode. I'll speak to you. We'll we'll see you all again in two weeks. Yep. Thanks, everybody. Thank you. Heat. Hey Heat. [Music]