Hivemind: Will 2026 Be Bullish & Crypto's Token vs Equity Problem

Transcript

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. Hi everyone and welcome to another episode of the Hivemind podcast. The goal of the podcast is to provide an inside look into 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 Cedus for institutional research arm, Jan, managing partner adventures, and

Jason who is the head of macro at the at the research arm and a common guest on the on the on the podcast. A lot of stuff to talk about today. He's an official mainstay now. >> He's an official mainstay now. >> Yeah, >> that's right. >> Do we need to do we need to address that? >> No. Uh, no. He's just, you know, head of markets. Market's an important part of Deli, you know. So, uh, he's official hive minder. >> All right. I'm sure we'll be bringing, uh, Flood back from some for some guest appearances now and then. Um, he he doesn't miss it. he won't miss a chance, especially when we're talking Galaxy or some other one of his bags. Um, cool. So, it's been it's been a good few

days. Uh, at the time of recording, we've retraced some of that some of that goodness. So, we're recording at 3:38 um UTC on a on a on a Wednesday and crypto has just started going down uh after after a good few days, which is unfortunate. Um there's a lot of stuff to cover today. There's actually some some real stuff happened since our last episode, but maybe we want to start with with markets. How are people feeling here? There's a lot of bull talk on the timeline yesterday. How are people feeling right now? Maybe maybe Jason, let's start with you. Head of markets.

>> Yeah. Uh, sure. Uh, yeah. Know the start of the year was was kind of nice, right? We we rallied a bit and then the 9:30 New York open seller returned uh again yesterday and and again today to pick up where he left off uh pretty much every day for the last three months, it seems uh heading into the end of the year. So, I mean, I uh I think I think the market kind of maybe got over its skis a little bit when you got like that uh MSCI announcement uh the other day. You saw like a really quick pop. A lot of a lot of people put on some leverage and stuff, you know, the highest point in the last several months. And then like you know,

it was a good announcement, but like it's nothing like concrete. It's it's not saying like, you know, strategy is going to be included in the MSEI, which we could talk about more in depth in a bit, I guess, but I I just think like it's more of like a positioning thing. Like, uh, equities still look great for the most part. Um, I just think crypto is still like I I think Q1 will generally be good for crypto. I think you're I think we're going to get a a pretty nice like mean reversion relief rally um at some point in in the first quarter. I just think there's there's just uh I guess like

still a lot of underwater positions that need to be worked through, right? Um I think you're starting to see institutions step back in. Uh ETF flows have been, you know, really, really good the last couple days into the new year, which is something you want to see. You're starting to see trading volumes pick back up on places like lighter and hyperlquid. Open interest is increasing, right? So, um to me, that kind of signals like risk appetite is is starting to make its way back in to to the market. But I still think um I still think, you know, the market is is just obviously relatively weak to to um to Tradfi and and other places where people, you know, want to speculate and

stuff. I'm also looking at, you know, things like Coinbase Premium. like pretty much all of the strong like trends or periods of price action that we've had over the last, you know, 2 years or so have been um on the back of, you know, a a relatively strong Coinbase premium and we still don't really have that. We've we've seen signs of it maybe coming back in the last couple days, but I think we need a little bit, you know, more confirmation. So, like you're starting to see appetite return. I I I'm not sure it's it's fully back enough for like, you know, a long-term rally, but I do think, you know, just oversold mean reversion flows coming back in in the new year um from institutions and, you

know, retail risk appetite on on the dexes like we're seeing could lead to like a nice, you know, reversion trade back up towards like 100, maybe a little bit higher and then who knows what happens after that. But like I said, Q1 I'm generally bullish for. I I'm looking to get positioned for a bullish Q1. I took a lot of time off in between Christmas and New Year, so I'm pretty flat on, you know, trades and and positions right now. So, I'm kind of like looking for an opportunity to uh allocate right now. >> Yeah. Uh no, I think you had uh if you were to kind of think for a look for a proxy, you'd think of end of 22, right?

where you had a rough end of year and so you have your natural tax loss harvesting and a lot of people selling to to to do that and then right afterwards you kind of see those in anticipation of that bidding and so I think you had a repeat of that where you know some of this positioning is long-term some of it is is strictly trade-based um we were chatting earlier it's like you don't love to see equities up and and crypto down because then you you you know it's very uh symptomatic to just crypto itself being weak and and not just a broader market. Um I think you're you're it probably takes some time where people who are looking to allocate are

are waiting to pick their spots and and if certain levels are kind of defended, I think it gives people conviction. So I'm in the same camp where um I think after the rough Q4 things should start to look up in terms of of catalyst as well. you have, you know, uh, JPAL is now on on the clock, right? And so you assume stuff like that gets front run. I think the, um, the Venezuela situation is pretty bullish for that from the perspective of, uh, oil and and input costs and and what that means for inflation. You know, shipping comes down, everything like costs can come down. And I think it's very conducive to a uh, more friendly Fed. um and and the argument gets

stronger and and so I think yeah the setup is is pretty bullish for Q1. You assume that you know I think JPAL is is either May or June um ending but but that typically will get front run. So I think the argument is pretty strong for a bullish Q1 and then kind of a reassessment. Um you still haven't really found a a consistent bidder. I think Sailor's probably going to be out of the market. um you had the MSCI element come through, but I think um you know that was indicative of two things. One, the market isn't that strong because you saw a pump and then a pretty quick retrace on on good news, which you know is typically telling you that the market isn't that strong where you you'd expect for something like that to be more

bullish. But then the counter is that it did come with some uh stipulations in terms of what can be purchased and so it wasn't as bullish as it seemed on the surface. So maybe the reaction was actually relatively appropriate and not uh telling you that the market is pretty weak. I think generally, you know, funds receive new capital and deploy beginning of year and then and and just the amount of kind of selling you've seen across the board, uh, I think does set up for a a good bounce, but I'm I'm with Jason where I don't see this being a clear path to all-time highs, but but a clear path to a move higher and then kind of a reassessment.

>> Yeah. I don't know. I don't know if I have much much to say there. I do think that, you know, in like November and then December of last year, just like the consistent selling we had every day, there was like a lot of um new like long-term conclusions, I guess, people were were coming to with crypto that I was like, I don't know if this is like like with valuations and with like uh you know, how to how to value these things um you know, or like a one token's dead forever stuff like this. I think sometimes like the really strong price moves in one direction can kind of like overshoot

some of that stuff in some sense. I do yeah like I do expect Q1 to be good just because of the the mean version and how bad like the end of the year was. You you kind of think that like new year is kind of a clean slate. Um, and just like even like there I'm sure there was a decent amount of like liquid funds that just shut down or something. >> Um, so we'll see. Like it was interesting to see the coins that did the best kind of to start the year. It was there's like a lot of stuff that was clear that like nobody wanted to have on their balance sheet to like end the year and then as soon as the new calendar moved over it's like >> you don't want Farcoin on your on your LP statement at the end of of

>> it's like you can trade you can trade the meme coins between like quarters and stuff right like if you ever want to show it. So it was interesting. You had like a lot of things that got hammered to end the year and do pretty well to start the year. Whereas you had like Zcash actually was kind of weak to start the year, right? It's something that did really well to end the year. And so maybe it was the ver reverse like people waiting until the new year on Zcash take profit and stuff like that. Um but yeah, we'll see. Today's the first day all year to me that feels like 2025 Q4 again, right? like the first few days did genuinely felt like a little different and like you're you're really skeptical of it, right? But it's like

every day you keep getting it. Crypto is such a trending asset class that like the more days in a row you get when it's different, the more likely it's going to like keep continuing, right? So, we'll see like if this day here is just kind of like a one-off thing or if we really do kind of like kill this trend here. But, I don't know. So the overall I guess it's like yeah I just always have the thing is I always just have like a bullish bias in general also because I'm not like a trader right and so I'm not really in the game of like predicting what this quarter does to be straight up and it's like it's it just feels like

there's so many good tailwinds for markets in general. And the only thing that really concerns me is yeah, days like today where equities are all-time highs again and we're back to being bad again, right? And you kind of you kind of hope that most of that was flushed out. That was kind of what I was thinking, right? Like most of that was going to get flushed out by the end of the year and then New Year's kind of like a clean slate, which you saw for the first few days.

Um, so yeah, we'll see. I feel like I said a lot without really saying anything there. Um, >> how do you feel about everything, Jose, since you've been pretty like bare pill going back to like September, Octoberish or whatever? How are you feeling now that you've had some time to reflect without getting too hammered in the market? >> Yeah. Um I I still feel uh yeah like the same thing I felt then, right? I felt like there was a risk of me getting behold, whatever whenever a retreat was. I still kind of feel that. Um you know, at the at the bottom there's always like a reason why it's never going to it's

never going to be the same again. Um, and for me the I it's not that I'm like bearish all of crypto, but I don't like for for the first sort of I don't know for since 2017 when I when I entered crypto, I was always just similar to you said I was just like bullish long term and I didn't really care about the short term. I was just going to hold this stuff long term. I didn't really care about FOMC. It was it just seemed up only to me. Um, and for me that I I don't see it that way anymore.

Um, like I don't see it as obvious. I think there's certain things in crypto that have clear product market fit and will continue to exist. I think those are all gen generally like pretty well priced. Um, like they're they're I think they'll do well, but they're not like other than something like pump, I guess, which has its own, you know, risks that things are are priced pretty well. And then for the rest, I I just think that the really exciting opportunities that you just like want to hold on to um and watch the growth are are are mostly outside of crypto for me now, which is kind of sucks, but uh cuz cuz crypto's obviously like I love crypto and it's just a lot more interesting than than

than the other stuff and a lot more open, but that's kind of how I how I still feel about it. >> Yeah. I mean, I I agree with you on a lot of that. Like, you can't just be blindly bullish on crypto. Um, >> like taking an index type approach doesn't really work still and is actually getting worse if you want to do that. Um, so you really can't be like super passive. You can I guess you could just hold like Bitcoin if you wanted to and then like go about your life. And that's what a lot of people I think do, right?

>> Um, >> but there's still I don't know. I still think there's like when you're talking about liquid markets with like the big opportunity. Crypto is still that for me. We are going to get some things that do really well. Again, you've had some good liquid stuff recently. Zcash went up like 10x. Betad's went up 10x. Um I don't know what else has um like there there is there are going to be pockets. Um but I do think that um

it is I it's just tough like a lot of new stuff still hasn't even had unlocks and it's trading below private valuations. Right. >> Yeah. And so on the one hand you can say that the unlocks are going to be less impactful because valuations have already come down so much. Um I don't know somebody had a poll in the in the deli chat and it was like what do you think's going to outperform this year? Bitcoin cryptox Bitcoin uh NASDAQ or other?

And I picked crypto X Bitcoin which I guess is a bit uh >> you picked cryptox Bitcoin. Yeah. >> How do you define that though? >> But that's the thing that that's exactly my point. It's like very hard to define because like >> like I don't know if >> I I'm like so much of that is ETH, right? >> And I don't know if he's going to outperform. >> So you're just saying just like literally market cap of crypto minus BTC. You think? >> I mean that's what the poll had, but I don't really like that answer per se because like I don't believe that we're ever going back to you know one of those type of markets.

But I do just think that like there are going to be some like pretty massive winners this year. The question is like is it going to be like last year where it was really just hyperlquid, right? Like cuz what else really won last year and actually Hyperlquid ended up finishing flat I think year year over I think it's cuz it was all like November December. >> The snapshot is all is a big part. >> Yeah. I mean so what it ted at the end of November 2024, right? >> But it was like the last big winner, right? >> Yeah. Yeah. Yeah. last like sustainable winner. >> Yeah. So, it's like are we going to have more of those this year? Like part of me does think was 2025 just some crazy anomaly in like a bad way or is it that that's like the question I think

everyone's trying to answer because it's actually impressive how bad both Bitcoin and crypto did last year considering everything else. And some of that with like you know Bitcoin specifically is that Bitcoin just frontr run a ton of gains after the election to an extent that like other assets didn't and then it kind of spent like the year distributing out. >> That's the thing is yeah usually these snapshots are really what drive the the comparisons because you like you said you had that big rally end of year 24. >> But no I guess like the way I would answer that question is like what's the large cap alt that I'm most bullish on?

It's still Salana. Do I think at the end of the year Salana will have outperformed Bitcoin? I'll say yes. That's like kind of how I'm viewing the market right now. Um, but we'll see. Like if it doesn't, then I have a hard time to believe that it would be like Salana, like a specific Salana reason why it didn't. Um, and so it could just be real apathy towards like L1 tokens and just more speculation in general. There's a world where where revenue continues to be what's and like I think it's the likely path where that becomes the overarching thing that people focus more and more on

which hurts the L1's helps the apps and so it does create a situation where you have like you know what you're describing but there can still be some solid opportunities. It's just going to be harder to find them. >> Yeah. Um >> cuz you don't have the rising tide. You just have the I can beat the hot ball of money. >> Yeah. And I mean L1 is doing badly hurts a lot of the other stuff too. >> I do think it could be like I do think we could be entering like a golden age of application investing in crypto. And I don't know if we want to segue this into like the ownership coin stuff, token versus equity models, things of

that nature. Um, >> yeah, >> I think though that >> last year too, by the way, right, we we we kind of thought there was going to be an application golden age, I think. >> Did we? >> Yeah. >> Yeah. Well, the thing is the tokens are still at least. >> Yeah. >> I think that like the big change now is this is the first time that we're actually seeing people really fight back against the way tokens are designed. And basically, you know, since tokens don't have any real rights on any of the revenues of the protocol, the only way you could really trust that a token was valuable is if they did buybacks, right? And that's why like

Hyperliquid did so well. Hyperlink was just like, "Hey, we're going to con we're going to commit to doing buybacks." And so yes, there was like a lot of structural buying which helped that too, but it was also like a really big signal to the market that like this token is valuable and like we're going to acrew value to it. And I just think that >> there's there was tokens doing this already, right? Like Hyperlid wasn't the first to do this. >> Sure. Yeah. Yeah. They weren't the first to do it. A lot of times though, buybacks too, they're like discretionary. They're like a small amount. Um but yeah, I don't know. We've seen so many just token kind of like rugs over the past few years that it seems pretty clear now that

um like lighter is a good example of this where they launched their token out of like their USC Corp and they're doing everything to like acrew value to the token, right? And I think that if you launch a token in in today, it's like you do need a pretty clear strategy for like why your token is not [ __ ] Um, and I think this dual equity token model, like personally, if there's a dual equity token, it's really hard to get behind the token unless it's like super clear that the token's going to be a priority.

>> Yeah, that's the thing is like you it can exist, but it depends on the way that they coexist. If you have value occurring to both um I think the sum of the parts is is less than if you were to just send it to one of them but less so the equity if if there's no real exit opportunity. I think it's more so the token. So basically if you have value flowing to both no one's really going to want to buy the equity if they have this weird token obligation. Maybe they do and then there's a uh you know some issue with kind of the community after that. So I think it's just a messy situation where you're sending value to an entity that you you can't really get any kind of value from. So I think the

the ideal scenario is is sending to token. I think so like zooming out you need a couple of elements for this to work which you know one there has to be some degree of trust um with the team and you know the tricky part is trust can be lost. So you can go into it with it being there and then you know nefarious things can happen but I I think part of it is that needs to be there which I think you could probably say might be an issue with the design if if if you rely on trust rather than some form of legal or regulatory certainty that you so you don't have to necessarily think about that. Um but in a world where you have this uh the value flowing to the token but the equity basically operating in a way to just

encourage value to the token. So it it it's, you know, a cost center. You can I think a popular thing now is is these foundation models, right? Where you basically have a foundation that owns tokens and it can sell those to help with with funding operations. Um, I do think the whole idea of 50% of the supply going to the community isn't is is going to fall by the wayside a bit more. Um I I I don't think it's necessary and it typically ends >> or it'll happen but you but you have to pay for it. It's it doesn't just get distributed, right? It'll be like an ICO or something.

>> Yeah, at that point they're investors, right? It's like in rather than incentives because I think in most cases those incentives get gamed and >> there's always a dual there's always a dual thing structure. There's always like equity and and token, right? It's just how much value gets siphoned both. There's always >> we used to do SAS, >> right? But there was just like no legal protection, so people stopped doing them, >> but there's still like an entity that's paying out salaries and like holding any IP and like there's always a legal entity. It's just like whether that thing will acrue any of the value and like yeah historically and we've been talking about this since 2018 I think when we started talking about this but

like historically you always prefer if all the value goes to the token and so the equity entity either like makes money by holding tokens and we kind of saw some of this in back in the day where like Axi raised a bunch into the equity company and the main monetization was like holding tokens plus they like own the IP and there was you know some idea that you could potentially monetize that someday. Uh, and you've seen a few other situations like that. Um, sometimes you see like the equity company has like different business lines than the token. I think that gets really murky. I think whenever there's any value that basically is split between both like Yan was saying, it gets super murky because shareholders just have like real rights and token holders don't. And and like the often

the founders have different ownership in both, right? like sometimes they own more of the equity in the token and so it just misalign things quite a lot. Um and obviously you saw like a bunch of cases back in the day where like equity would capture all the value and the token would uh be used to subsidize that value uh in the expectation of future value capture that never came right like the fantex of the world. um where you know the airdrop subsidized a bunch of trading volume that all went to the equity and then the token was just totally rugged. Um and there's many many such cases.

Um so there's like a few solutions to this. I think people have gotten really creative to Yeah, the SA is obviously one that that that came along to to to fix this. Um but like initially how we thought things would work is that these things would run fully on chain, right? And so there would be no need for an equity like the the the like how we thought about this back in the day was that the equity vehicle will just be one of many organizations that works for this DAO, right? And the DAO will be governed by token holders and all the value flows will go to token holders and everything will be on chain and therefore it's a parameter that the DAO votes on, right? Like the fee switch and stuff like this. But I think when this

changes is when you start first of all these things start looking more like startups and more like applications right with websites that that are valuable versus onchain things um and and they have like BD arms and and and all and and like strategic decisions they have to make. I think Dows are like really badly suited to that and have kind of proven to be. And so now you need like a new model, right? A model that gives you more flexibility um that lets you capture value that's not necessarily on chain. um that lets you decide whether you want to distribute it or whether you want to invest in growth.

And so I think that's like the context in which like metadal comes into the comes into the fray with this ownership coin and then with the the the coliseum stamp. I don't know. Jason, do you want you want to say anything or maybe Cedus you can introduce the ownership coin stuff? >> Yeah, I think the ownership coin stuff is just like metad's new narrative. um you know they still care about decision markets and futur but their main thing right now is is this ICO platform where when you invest in a protocol that's launching on it you the coin is essentially like equity in a sense where it owns the IP it owns the revenue um and so it's very clean and like very aligned from that uh perspective and

then Coliseum who's like this Salana incubator VC fund that only does Salana stuff um they released this new legal structure called a stamp and it's a it's like a token agreement for it's it's essentially like a SAF but it's through Metadow. So >> how does that work exactly? So you invest into this stamp um and then sorry I'm on the site u basically you raise capital you sell the stamp and then instead of being like this safe plus token warrant which is the way it works today there's no equity portion and so when

the when the protocol so this way so like a big critique of metadow is that like oh when you go if you ICO on metadow and you're ICOing from day one you have like this liquid token day one and your protocol and it's like do you really want that? Do you want to be a founder who like when you start your protocol you have a liquid token. What the stamp does is it says like hey we're going to be doing a metadow launch in the future but we're going to raise money now and kind of like stay private, right? And so you invest in this stamp and then when the token goes live on metadow it converts to pure token. There's no equity portion. And it's like a very clean this is kind of how you go, right? Um and so right now actually there's the first

one. I don't know if they're actually using the stamp, but like Ranger Finance is they're like a per aggregator on Salana along with some other stuff. They're doing their metadow ICO. the first metadow ICO that has previous investors and they're doing the metadata raise and so it'll be a good test to see like if this does a product market fit because like all the metadata raises so far they didn't have prior investors right they just came in and they did the public raise and then they went about their ways but the thing is you still want to raise from VCs right there's like for a lot of teams right like if I was if I was creating my own look if any of us were creating our own product protocol right Would we go directly to retail day one with the liquid token?

Would we do that? Like I wouldn't, right? I would probably raise from VCs that could help me out. Like think about Metadow. Like Metadow itself, they have been fully liquid from day one. Okay. And so anybody could buy Metadow from day one on the public market. Um, which is great. Like I love when everybody has access to something like if totally public if it becomes like totally public unicorn. I think that's like those are those are the outcomes that crypto is like meant for, right? Like totally public. People can do it. But Metadow still has a lot of VCs involved, right?

Because like after their token was liquid, they sold OTC to Paradigm. They sold OTC to Coliseum. They've sold to Thea, which is like a liquid fund, right? And think about all the work that like Coliseum's done for Metadata, right? And like Paradigm has done stuff for them, right? like people still want VCs because they can help them in certain ways that they can't necessarily do themselves, but you also want, you know, retail to also get in at like fair prices and everything. You kind of need to like balance all that. Um, so yeah, I don't know. I think that there's just a big there's there's a there's just tons of demand. Like I said before, Lighter token too, right? like lighter is not doing a stamp or an ownership coin or whatever, but they are

making it so that they're trying to acrew as much value to the token as they can, right? I think like anything that I think that, you know, we we we always talk about like tokens aren't equities because we don't want them to fall under securities laws, but that doesn't mean that we want tokens to be like [ __ ] and valueless, right? Like what we really want is we want tokens to be equity. We just want them to be like compliant. You want to be able to comply with it, >> right? I think that the one thing is that um you have kind of unfortunate uh cash use dynamics for these early startups as a as a product of how the environment thinks about value acrruel

where because there is no there there's not a lot of certainty around the fact that value will acrue with to the token for a lot of these projects. These projects are forced to distribute value to the token immediately as a show of yes, we are actually going to do it. When in reality for a lot of these early stage ones, they the logical approach is not to send value back to the token. It's to use proceeds for something more useful to grow the business, right? And and you're kind of forced to to to buy back or yield or whatever it might be because that's the only way you can actually demonstrate certainty around that value acrruel. And and so that's kind of why I was going back to the you know the foundation model as well where you know

in an ideal world you uh acrew revenue to a wallet right that that is basically like retained earnings for the company. The company funds operations initially through the private sales can be VC, it can be on Legion, it can be like you know a mix and uses that to to to grow the business and then over time you have this foundation that's also sitting on a bunch of tokens and they would use the proceeds from that to fund future operations. And so and then at that point after that you you have uh basically this the system where you know the the the company requests you know annual distributions from this wallet uh

to fund operations and it's a proposal and and realistically you know from from a governance perspective you're not going to say you know some people will say no but I think the majority of time right the risk is oh we're going to request the community will say no and the and the companies starve realistically sure some people will say no because they'll think it's too high but generally you're you're not going to starve the business of cash and continue to hold the token. You're usually just going to be like, "This is too much. I don't like it. I'm out." And so, you have this reallocation of holders who actually believe in in the way this is happening. But what that means is this value is governed by the token, but it doesn't necessarily need to be returned to the token. You could also implement some kind of mechanisms uh to to

actually directly send value to the token, buyback, dividend, whatever it is, and and set thresholds where it can't be paged by the token holders and then then it goes away. There's you can parameterize all of that, but I think that is the is the most effective way to ensure that the the you're not forcing day one distros to the token, but you are basically benefiting to the same degree from a value cruel perspective. >> Yeah. Like the from my perspective, the the reason buybacks got so big was to like for your point prove that the token is not valueless. And so if you do have these like ownership coins, you have these uh tokens that are essentially equity that it really negates a big portion of the need for buybacks or distributing dividends or anything. And

>> yeah, because it's the trust thing, right? It's like hyper 99% buyback. So you know all the cash is going to be used for that, right? And and the less you have trust in that, the more discounted these cash flows trade, which is why you have this bizarre phenomenon where like crypto has both the most overvalued assets in the world and like some of the most some of the cheapest on a multiples basis, right? Because people just don't believe the business is durable. They don't believe the cash flows, but like you know, they're like Robbit or or like even Pump or like like insanely cheap for how much money they're they're they're how much cash they're spitting off, right? Um, and so yeah, that's kind of an interesting uh and and and like that's the foundation

thing is interesting too because like the the reason that was cool was because it can basically be a transparent vehicle to the token, right? Because foundations can have beneficiaries that aren't necessarily like people or entities. You can have a a beneficiary that is the DAO and all its constituents or the token holders or something like this. So you can have like a legally enforcable uh mandate for the foundation to act in in in in benefit of token holders, which is which is nice, right? Because with a company [ __ ] can can like it's almost like uh the the the law working as intended actually screws you as a as a token holder in many scenarios because the the company's meant to optimize for has fiduciary duties to its shareholders. So that was nice. But then foundations have all sorts of issues, right? They're like extremely

bureaucratic and and there's a bunch of 2017 ICO foundations that that are that are like literally family offices, you know, for these people at this point. They have like nine figures in ETH and they've never shipped anything and they're just going to the money is going to be stuck there forever, right? And and like, you know, the their descendants will live on um in in doing this thing like the the Golem guys or whatever. I I don't know. Not to not to call out particular ones. I have no idea what they've built, but like Yeah. Um and and the so this is the the ownership coins is an interesting concept I think like and we need definitely more of this to to instill trust in in tokens. I guess my thing is like equity is just the best thing. Um and so I think the

the the issue with Yeah. Like my so and maybe the other the the the the other point is like you if everything was on chain you wouldn't need any of this right if if if these things actually ran fully on chain as Dows you wouldn't need any of these constructions like it would all just run through governance you don't even have admin keys nothing so these things aren't they they're looking more and more like companies which is not initially what we thought it was going to be we thought these were like new actually new things they were going to dow they're decentralized there going to be a bunch of companies working for them and so it's it's it's a new class of thing. It doesn't it's not an equity. Um now I think these things are like companies like there's very little decentralized about a lot of this stuff. Um not all of

it to be clear but but a lot of it and so and so in that case why not just make it an equity and and for the most and and my biggest problem with Metadal and I love Metadam. I'm a holder thanks to Rinko and uh I I love what they're doing. But my biggest problem with capital formation generally like the the the biggest hurdle is negative selection, right? Adverse selection. Like you want like in general the founders that want to go direct are not the best ones for the reasons that you mentioned before, Ceterus, right? If you're a good founder launching something, why would you not just raise from VCs who are like extremely experienced? They're going to be able to help you out. uh they won't whine about a 10k check and like try and sue you and in class actions and stuff because

that'll ruin the reputation. They're they're like you are their customer. Why would you go direct? And historically that's that's always been been a pretty good indicator, right? There's very like um and and I I don't think this mechanism like solves that. I still think if you're >> that's what the stamp does. You raise from VCs and then in the future you do the metadata raise. But why would you why do the metads I guess like you're building >> I think there's some value in building community uh if you if you target a a small like you want that sweet spot where it's you know you're not spending you're not selling too much but you're selling just enough to to raise from the community and and and kind of build

build that and then at the same time you're probably giving them you know decent terms so you can raise at at a pretty good vow. Um I don't I don't think you should primarily do that. I think yeah like you know for all the reasons you guys mentioned early on venture stuff makes more sense but at some point I think it there is value in getting community involvement. I mean, yeah, this is what we kind of the airdrop debate is kind of like this, right? Like instead of airdropping, have people do give a public IC ICO at like a good price. And that's kind of what this is doing in a sense like if Rangers ICO Rangers did a whole point season and what their points give you is like priority access to the ICO, right? Which I think the Meta all the metad ICOs have

been priced pretty cheap. They've all been priced under like 10 mil. Um, I don't know what Rangers priced at. I haven't looked at it specifically, but that's kind of what they're trying to do with this is they're trying to get like if you can you can go do the pure metadata thing from day one if you want, but if you want to do like the VC then public, there's still this is like the path to it. >> Do you think there's actually going to be a lot of people using or going the route of, you know, raising from VCs and then going through like the stamp process or whatever? or do you think it's going to metadata will mostly just be retail raises only kind of like what we saw with the original ones like like what would this look like what would success of this look like to you cuz

like this was launched in December so like very clearly like Ranger like you said Rangers the first one so like >> like what would like actual success of something like this like show that it's gaining traction like how many teams or how much capital would have to be like raised for you to be like okay like this is actually something that >> I think you need like one or two home run ICOs like one or two good success stories. I think the biggest risk for metadow is that like kind of to Jose's point with like the adverse selection thing but to get more granular it's like bad founder experiences with it and then that gets around and then people decide that this is not the model they want to do. So I

think that like you need to have a couple projects that actually surpass metadow market cap and become like highly successful protocols. Like just to be like theoretical, if unis swap did this right where they had they did their raise and then instead of doing the unis swap airdrop, they did a model like this with the ownership coin and everything and then unis swap becomes this like super highly success successful protocol that would at that would give a lot of credence to this model and then it would convince a lot more >> um founders to like end up doing it. We got to give credit to Gabe here. Uh like Metal X is at the is at the back end of

what this whole Metadal is building. And Metall Gabe predicted this like years ago. you know, his whole thing is like these these these companies need to be like Borgs that are like legally >> legally which which is exactly what uh like Metadow's like ownership coins are using like these things are are Borgs which are basically like real world entities that are contractually obligated to act in predictable ways that favor token holders, right? So you you actually have like as a token holder, you have legally enforcable rights because there's an entity that's been built like purpose-built for that, right? And he's built a bunch of them, I think, for for Lido and others. Uh but it's cool to see it being rolled out

with with with Metadal cuz yeah, it's like a genuinely necessary kind of primitive. >> The thing is like at the end of the day, what has been crypto's main use case? Like you can say Bitcoin, yeah, sure. But in my opinion, it's like capital formation and this idea that like people from all around the world can come together. You have this super liquid financial market. People can easily raise money and all we're trying to do is like make the tokens useful, right? And we've just beat around this for so many years because nobody wanted to get in trouble with securities laws. And I mean, Gabe had an interesting, he quote

tweeted one of my things yesterday talking about this and was like, "More people need to get securities reform pill because his main concern is that what the legislation ends up coming out as is actually going to disappoint a lot of people, right?" Because if you do get legislation where it's like tokens or commodities, then you're kind of like not like I for L1's like, "Yeah, tokens commodities makes complete sense for me." But it, you know, it doesn't make sense for like an application, right? And I think that we shouldn't have to have some kind of bastardized model where we pretend like the token is not equity right?

>> Does a commodity classification hinder their ability to send value to the token? I think the way it is right now is a lot of this stuff is like programmatic where it's like you need these programmatic rules about distributions and everything and that's just like not it's just not flexible enough, right? It's like too rigid to like kind of have this and again distributing back all this stuff programmatically for a lot of cases does not make sense. I think that initially these things weren't supposed to be security and like Gabe was very I mean Gabe is very much like a cipher punk but trying to do it by the law is is how I would see it. He's like uh he he he thinks this thing has to be cipher

punk because otherwise it's just regarb right. Um which I think is like a valid point. Like I think a lot of these things are securities and you you can't like the best way to change that is is to change securities laws and let people just do an equity instead of having to do all this complex stuff, >> right? Just let people do equity and have like lighter accreditation requirements like let more people trade and get into this stuff because >> like we have AI now all the value is going to be captured like all the value has or like a lot of the value has been captured by by private markets, right?

like OpenAI, like uh an Anthropic, um all the robotics companies, they're all like over a trillion dollar of private market value that like retail will never see, your for people's 401ks and stuff will never see. You need a change to this. And I think it's loosening uh securities regulations so more people can own them rather than allowing people to create these these weird instruments that that uh they they use to to like flaunt all the point of securities laws just like they dump on the public. They don't put any value through them. These things don't actually run on chain.

They're not actually decentralized. So I basically think if it's not Dows, if it's just onchain companies, then they should just be onchain securities is which is uh kind of like a grumpy old man take I think. Uh, which is kind of what Gabe It's kind of Gab's brand to some extent, but yeah, I agree with him. Yeah, I mean, >> we should have brought him on actually to talk about this. >> Yeah, for this it would have been great. I don't know. Like, but like when's the last time like there's actually been like a real like US securities law like reform or or upheaval, right? Like it pragmatically it doesn't sound like like I >> apparently this guy wants to do it. Is

it Paul Watkins? I think he wants to >> the new one. Yeah. I mean >> apparently he he wants to do it but he >> guess there's been a couple right in the last 20 years. So I guess it's like not out of the question. It's just like I guess I guess I'm just so jaded after the you know the Gensler era of of SEC that we actually get like anything like real past. But um >> yeah. But it's just like when you just think about it from first principles >> like what do you want? You want people to build profitable businesses on the internet like essentially.

>> Exactly. >> And everything is is been against doing that and the solutions are these convoluted really complicated legal structures that >> are you including stamp in that? I don't I don't think stamp is that complicated but I don't know if stamp is >> I mean it still requires like entities abroad to you know right >> I mean the difference with stamp is that the the foundations are actually forprofit whereas like every other kind of model has nonprofits for the foundations >> a for-profit foundation >> when you do the stamp thing like does coliseum or whoever like run is it done for the team or does the team still have

to set everything up when they go through like >> how does Uh I'm assure um I'm assuming I mean I would hope they make it relatively easy because they're like mega >> relatively costly to set up these offshore entities right like >> oh I think that they yeah because the stamp the stamp requires you to go through metadow >> you can't like use the stamp and go through another platform so I think that they do all this stuff for you metadow is still a um it's not permissionless right like it's totally curated by them >> um which is like there's pros and cons to that, right? Uh >> it's how you start for sure. I think it's how you need to start something like this.

>> Yeah. >> So, yeah, and you were going to say something before. Um >> Yeah, I was gonna say I think like the the Dow element of these things particularly early on I'm strongly against. I I like that I I don't and I think you can have and and like the insurance against that is basically um twofold. one, you can enable governance from day one, but a lot of contracts now allow lock tokens to participate in in voting decisions, right? And so you have team lock tokens plus, you know, with this foundation component, you um you basically can corner any decision for many years if you if you need to. And and I think is the right move for the most part,

especially early on. you're investing in these people to build these products and ultimately you don't want anything to kind of hinder that progress. So like I'm I like the idea of of Futarchy, but I think the application like the the the surface area of application for it is massively exaggerated and and it like there are times when it works, but I think there are many times when it doesn't. And so I think that is probably one issue I do have with stamp is that they mandate futarchy and and so I don't know how early that comes into play but that I I I don't love.

>> Yeah. And like why why would the best >> Wait control of their Yeah. Sorry. Go ahead. >> I was just going to say like on that point the stamp again the stamp lets you stay private for a long time right it's not until you actually go to metadow that that then this all comes into play. And then when it comes to the futuri, the only stuff that is really being used right now is like the monthly budgeting for the team. It's not used for like decision-m like you still have centralized decision- making. That's something that they've changed recently because it just wasn't going to work. Um, and so right now it's like when when when teams do these metadal launches, like Ranger is

when you're going into this Ranger ICO, it tells you every month there's 250k USDC that's going to be given to the team and then this will be used for salaries and blah blah blah blah blah blah and like this is it and it's like programmatic and they can't do more. But like all the decisions for Ranger and what they're doing, they don't need to go to a decision market. >> But again, like why why would a you know what I mean? Like why would a good founder uh and I'm not saying I don't know the range of founders and there obviously like market dynamics with having tokens and stuff but like in principle if you're a really ambitious really smart founder why would you give away control of your of your treasury um not have control of funds when you know when you can just literally raise from

VCs with like cart blanch like that that's why why I think anything that makes the founder the proposition to the founder worse is just going to lead to adverse selection and adverse selection is the killer for for platforms like this. >> The argument is that your token will trade at a premium >> and that's like the bullcase is that if you do an ownership coin >> where you have these protections where it's transparent. Yes, some things are going to be a bit harder because you're going to have this monthly stipend and if you want to increase it, you got to go to the market and stuff like this.

But because these protections are in place, it's kind of like how the US equity market trades at higher premiums than everywhere else in the world. It's not just the fact that yes, it is obviously the tech is the best and you have the best companies and everything, but you also have the best protections, right? The best investor protections and that's kind of the same angle here. And so whether or not that that ends up being true, like your token trades at a premium here is we'll see, right? But that would be the argument I think um for why you would do this as a good founder. And like the Aevichi money guy who has a real product that product they've had for a while they were never going to do a token or anything but profit basically convinced him that like this is like a very legit way to do a

token and he got comfortable with doing it. He didn't feel comfortable doing a token any other way until the metadow mechanism and he was like, "Okay, this is something I feel comfortable doing." So, we'll see. I don't know. We'll see. I'm I'm I have a soft spot for Metadow. >> Me, too. >> Because I think they're trying to do the right thing, right? >> Yeah. Yeah, it's a really >> Yeah, I was going to say on one thing it is on these platforms uh and and the the incentives are aligned for them to really in pick good projects, right?

Because you if you think about uh normal private markets and public markets, many private companies fail, right? And and they fail privately and no one really knows. There's not this gradually declining price. It just kind of, you know, it raised at the last price and then it goes to zero. And that is typically funded by people who are doing who have experience and are doing a lot of diligence, right? And and they get it wrong all the time. Uh w with these liquid markets, the the gate to capital is much lower. So the the threshold of diligence is is much lower and the failures happen publicly, right? like public companies in equity markets don't really fail nearly as often because they

are very long-standing, durable, have gone through a lot of diligence, many rounds and and so there's, you know, there's a huge filter here. You don't necessarily have that. Um, you have one round of investing and then they'll go kind of public. And so it it like and and when I say the incentives are aligned is is that you know these platforms have kind of two motivating uh uh kind of pillars, right? one is ensure that the raises go well uh because that's an important marketing tool for for the next company that they want to uh help raise and then also ensure that these raises happen at good vows and you don't have down only action because then you cannibalize your your demand side customer base. So like there it is it's

definitely going to be on them to to really ensure that they are picking top tier quality projects because these things are are much less battle tested than any other very retail accessible uh investments. >> Yeah, I I think Metadau is one of the most like um innovative and one of the coolest experiments in in this area I've seen. Uh but my take is like increasingly that just for for this stuff like tokenized equity is is going to be is going to be the thing. I'm hoping we can get >> we can get there where we straight up have tokenized equity natively, not like bringing our WAS on,

but uh we can do it in a way that makes sense and uh is actually you're actually able to comply with, right? That's like the holy grail, but that takes like security reform maybe, which is Gab's point. >> Yeah. Uh >> well, he's he's he's doing he's doing some really cool stuff with with Metal X in that respect. >> We should get uh we should get Gabe and Rinko back in a couple months after this stuff has had, you know, a few months to to percolate, get some projects and kind of >> That's a really good idea. >> Get the inside scoop there, you know.

>> Yeah, Gab's doing some really cool stuff with like tokenizing shares directly. Um, but yeah, it's it it would obviously hugely benefit from securities reform like >> Yeah. >> Yeah. >> But I I don't see why in the future you want like cuz you're going to have so many RWAs on chain. Like I really think everything is going to be I still think everything's going to be tokenized. I just think there's there's a lot of accredited people on chain. I'd be curious like what the number is of the you know however many users are on chain. Uh, you know, I think people estimate what, like 50 to 100 million like unique users on chain.

>> Depends on the price of Bitcoin that week. >> Yeah. Um, how many accredited do you think there are? Like I feel like there's there's got to be a couple million uh people with over a million net worth on chain. >> Yeah, for sure. There's like I mean there are stats on like how many crypto millionaires are there. Yeah, because the thing with Gab's uh thing that's really dope, I actually went through the process today. Uh I got a credit and by the way, we're we're investors in in in Metalex, but I and and I also hold uh Meta. Uh so, >> by the way, Chad GBT, yeah, I hold Meta, too. Obviously, I talk about all the time.

>> Uh Chad GPT tells me that there are >> around 240k crypto millionaires. feel like 250k. >> Interesting. >> Less than I would have thought. >> It says millionaires is around 450. >> What was it on October 9th? >> Yeah. >> Yeah. So, >> it is you were right. It is lower than I thought it would be. >> Yeah. I mean, that that kind of checks, but so the I don't know how the hell it calculates that, but >> very specific number 243,000.

>> No, no. said. >> Yeah. Well, what's kind of specific here? >> The Yeah, the the thing he does that's cool is like you can basically verify accreditation by just signing a transaction from your wallet. So, like if you have a wallet with over a million bucks in it, you can uh just literally sign a transaction, put in your name, you sign an attestation to say that you don't have debts that that you know net out to to less than a million net worth and you're accredited. you have an accredited certification and then you can participate in anything. Like that's super dope. I think like that's a very low barrier to entry to getting a bunch of onchain accredititations minted and then suddenly you can have like an actual onchain securities ecosystem that can trade, you know.

>> Yeah. You're like some memecoin gambler who like runs it up as soon as it hits a mill like you sign that [ __ ] baby. >> Now when you retrace 90% you still got it right and now you're good. Exactly. >> Show that to your dates. >> Or you just like basically your 10 friends, pull all your money in one wallet, and then just rotate. >> That's illegal. >> That's fraud. >> Fraud. We're not endorsing fraud. Do we want to talk about anything else or I mean, we're up to an hour here. >> Um, >> no. We could probably keep like the per deck stuff for a couple weeks. It'll give us more time to see if people are actually back or if it was just a >> two three day New Year's pump in uh in

activity. >> Yeah. >> Also, do you think the Do you think the poly market partial thing is cool? Bringing like I think like getting more liquid real estate prediction markets is cool because like real estate's one of those industries where it's actually really hard to express a good short side uh play on it, right? Especially in certain markets like in Canada, it's like the Canadian real estate market has been so overvalued for years, but there's also no way to short it. You have to like short the banks and it's like that is just not clean.

>> Relax, Michael Bur, chill. >> So, I think getting like liquid prediction markets on real estate is is pretty cool. Matt Lavine had a good piece on it about like, you know, shorting your your equity your your housing market, buying like an index of housing markets. Like there's a bunch of different kind of stuff you can do, right? Um if you think about like indust like like places like Detroit where it's like very industrial it would have been actually super valuable if you could have shorted the real estate market there as you work there because when the when the uh when the depression came or whatever right all the jobs went the housing market went down you lost your job it's like cascading effects right so there are like a lot of interesting use cases from having like very liquid >> yeah how do we short the New York real

estate market >> partially New York's one of those markets that's just like >> trading at 30. >> Everybody owns the real estate in New York now. >> What did you say, Jose? >> Parcel's trading at 30 mil FTV. >> Yeah, but I mean they have Parcel Labs, right? Which I think makes like all the money. So, this goes back to our token equity thing, right? I don't know. >> They need to become an ownership coin. >> Yeah. I remember talking to the Parcel guy. Well, he was like an intern, but a couple years ago when I went to this uh salana thing and uh yeah, it's parcel is really cool. Um but I looked at I looked at some of these mark I looked at these

markets on on poly market and it's like they're just like so like a liquid, right? So so a long way to go. Yeah, I think being the canonical price or article for a market that becomes globally relevant is like a pretty big business actually. Like the other the other one I'm interested in other I think real estate's an interesting one. I think private markets is the one I've been spending most time thinking about just like how you tokenize the entire private markets like it's like uh I think it's 150 trillion the size of the global private markets which is >> bring that on chain baby >> huge and and it it's it's it's the most similar thing well take startups I think

startups are the most similar thing to the exposure that onchain dgens's like you know Um, and they're like they're mostly actually building like real things. It Yeah. >> Yeah. >> I think it'd be interesting to find a way to do that. >> Cool. >> Cool, guys. This was a good one. Uh, enjoyed the enjoyed the chat. It made me more bullish meta than than than what I came in, actually. >> Yeah. One thing I guess I'll say before we end is just pay attention to this new uh there's a lot of infighting on Salana right now with like uh I would say it's like GTO and ellipsus. I would say it's like go and ellipsis guys on one side and then harmonic temporalhumidify

on the other side. And it's like salana block building over the next year or two. It's either going to go down three different paths. It's going to be jetto's bam model. It's going to be harmonics model which is like what works on Ethereum the PBS or it's going to be if Salana uh Anza can ship MCP multi multiple concurrent proposers. So there's like a really a lot of like really interesting stuff happening on happening on Salana market structure but still need >> yeah still need a block packing thing. Yeah, sorry. MCP is an alternative to to JTO and to >> uh yeah,

because you'd have multiple leaders just kind of like sending shreds at once. Um >> Okay. I haven't caught up on the latest with but right now there's a lot of beef with uh the harmonic and the jet teams. So, it's definitely something to like keep an eye on. release released this dashboard uh the other day around like validators that are doing timing games which is basically like you're you're waiting right until the block. So like Salana works on this the blocks are supposed to be continuous. So like as transactions come in they're just executed they're just streamed but harmonic has introduced PBS type model where it's discreet and so it's like they wait for a bunch of transactions and then boom they send the block every 400 milliseconds right and this has like a

lot of knockon effects to Salana the the harmonic guys you know have their own reasoning why this is a better model I'm not going to I need to look into it more but before like I totally have like my full-fledged take right now I'm kind of just like watching how this plays is out. Um, what was interesting though is that the largest salon at Forward Industries was doing these timing games, but that is because Galaxy runs their validator and Galaxy does these timing games and basically the TLDDR is that when you run these timing games, you get higher yield as a validator at like expense of the network. So yeah, anyways, that's something to pay

attention to. We'll probably go deeper into that in the future once like I just I expect this topic to get a lot louder over the next year within Salana because it's kind of like existential to Salana's future and like where it goes. >> Awesome. >> Yeah, I think with that we'll wrap it up. >> Thanks guys. >> We'll wrap. See you again in two weeks. See everybody.