🚨LIVE: Market's Ready For Higher! NVDA Earnings Today! Pedro Miranda, R. Leshner & Ethan Buchman

Transcript

[music] [music] 17 floor. >> [music] >> We'll see you around the timeline.

Feels good to be back. Roll up. It's headed to the top. [music] If we're not already at the top, we're going to the top. >> Rollup is my favorite. >> People from all walks of life, all over the world, all over this industry come together for the rollup. [music] >> [music] [music]

[music] [music] [music] [music] >> Zoom out. The institutions aren't coming. They're simply here. It's the golden age of crypto, guys. Get right. Let's go. [music] >> Welcome to the nest. See you on the show.

>> Hey, what a day we are live. Give me some sound effects. Here we go. It's another day in the rollup headquarters south. The rollup sign. You can see it's glistening behind me. I've got my coffee in a paper cup. We've got the green tinge on the right. We've got the plant on the left. This is the rollup headquarters live from South Florida. Today's August 26 and we're bringing you guys another fantastic show. I mean, lineup this entire week has been fantastic. It's been stellar. We've got Salana Foundation joining us in a moment uh live a little bit later today. So, we're going to get right into today's guests after today's topics, weather, markets, per usual. We'll hit our headlines later in today's show. And guys, hit me up in the chat as always.

We want to hear from you. Make sure that you're getting your questions answered. I know we've got the tried andrue, the absolute crew in the chat with us today. Freedom guy, you're the man. And I'm sure we're going to get some more. Greg, good to see you. Great show yesterday. Love Alex appearance in Robbie's interview. Really appreciate that from Greg. Uh guys, continue to tune in day in day out. And that's how you're going to outperform. How are we doing? Let me know in the chat what you guys want to hear about. We're going to speedrun through uh markets, weather, and more. Today's topics, as always, big shout out to Plume. These guys sponsor rollup headquarters north in New York City from the Empire State Building, the tokenization tower. Uh and sit Greg sender 5163. How are we doing? Let me

know in the chat. Let me know what you guys want to hear about. Plenty that we're watching both on the traditional side of things as well as the digital asset side of things. and uh we're going to continue to rock and roll today. Uh markets and weather and then uh Pedro from Salana Foundation Superstate co-founder Robert Leshner also co-founder of Compound from the old DeFi summer days and then Ethan Bman who is a true OG founder of Cosmos. So I mean just all across the board guys absolute stellar lineup here today and I'm excited to bring you to everything that you need to know at the forefront of the market. Uh, let's keep rolling through. We're going to get into markets

and weather before Pedro comes up. Before we do, let me tell you about dinari. Tokenized equities super cycle is upon us. Hundred trillion dollars of assets and this is becoming tokenized. Dinari is the tokenization partner for this asset class. They are bringing these things on chain in the form of equities. We will see these propagate throughout the entire multi-chain world. Starts with dinari. They'll give you exactly what you want on the tokenized equities front. Do more with your stocks. Weather's a little bit overcast, 85 degrees out. Uh, we're going to speedrun through the weather because I think you guys want to hear about the markets. First, let me tell you about Fracks. Open stable and borderless.

Fracks is crushing the stable coin game. One of the few stable coins that we treat as money and they are extending lines of credit to companies all across the globe. Onchain, offchain, uh, different regions, different jurisdictions, stable coin consortiums. These guys are everywhere in the stable coin world. Uh we're gonna improve our markets widget, but that's a little bit of alpha for you guys today. Uh that's going to be coming up soon. Salana uh just under that $100 mark. Bitcoin retracing to 78k a little bit. We're seeing some floundering in the momentum behind the liquidity supply uh with respect to the

long end of the curve markets as always powered by Zama but nevertheless we're seeing these things progress and so what we have here is near still holding that 180 level chain link honestly one of the strongest on the board today and over the last couple of weeks. We believe chain link is one of the primary benefactors of the legitimization of the industry. So remember, sure you guys haven't forgotten by now, but uh industry leaders including founder of chain link Sergey Nazerof was shaking the hand of the president of the United States also in the room for the CFTC advisory committee. Uh and we're seeing this buildout take place right before

our eyes. Uh chain link we believe as legitimization in the industry continues. Chainlink is one of the places where value will acrue because they are tapped into DeFi, stable coins, per vaults stretching across uh the industry as a whole. Big believers in chain link uh as a benefactor of this upcoming cycle. Bitcoin and ETH also holding the line. Uh 83K is a level that everyone's watching on the Bitcoin side. Uh, Ethereum uh had a real nice pop off the lows and I think the reflexivity as a result of the DATs, Sharlink Gaming and Bitmine taking Ethereum supply off of the table is going to lead to extra

reflexivity in Ethereum's asset. Uh, guys, Bit 5050, pleasure to have you. Little Miss Gun, good to see you again. Fra is King from Nebuluck and Royal. Good to see you guys here today. Keep it up in the chat, guys. We want to hear from you guys and uh see everything that you guys have going on. Uh first guest is uh going to join us in just a moment. Uh we're just checking to see whether or not he is set up. Let's get into a couple of the tweets. Uh and then we are going to uh bring up our first guest.

But first, I want to tell you guys about Mir. These guys are absolutely crushing. You see them on the board and they are holding levels nicely. We believe this is a benefactor of the tokenization super cycle as well as Zcash as well as AI buildout. Uh AI is not slowing down. Uh the debasement trade has picked up more momentum. Near is sort of at the crossroads of several of these things. And so we believe that near is going to be a benefactor especially as a result of the buildout not only in the tokenized equities market but also in the AI world. uh the confluence of several factors uh and near is cracked.

We know this because they've been building for such a long time. Um okay, similar on this AI front, Coin Bureau is reporting that someone built an entire Wall Street style trading desk using nine free Grock bots. Not sure if you guys have utilized Grockbot a little bit, but this is one of the new harnesses. Obviously, you know, when it comes to claw, people like to use openclaw, uh chatbt, you can use Hermes. There's a few different harnesses out there near our AI partner actually has their own harness and uh they call it ironclaw. So, there's a couple of harnesses out there. Um I haven't experimented too much in the harness

world, uh but this is what we're seeing. And someone decided to use the harness for Grock um to build this an entire trading desk vertically integrated uh and apparently it's profitable. In a similar vein, I saw a friend of the show uh founder of Nansen uh Alex also talk about basically make moneybot literally this uh uh this bot that you just instruct it. It's an agent. it is plugged into the smartest models uh probably the the open weight models. But what we see is that um these things are actually profitable. There was a very early frontier in this world where

agents you kind of just put them out there and it was like the prediction market uh agentic world and it was at the same time call and poly market were kind of in this badge war and you had these agents build out prediction market bots and they were arbitrageing between the two. you were basically providing liquidity on illlquid prediction markets on both poly market and koshi at the same time and it could arbitrage between the two. Um that was the early rendition of this but we're actually starting to see it get a lot more mature and sophisticated as the world gets built out a little bit more. Uh there is a video so we're going to play the video but just to point you guys into this definitely do your own research. plenty more to investigate here, but we're

seeing it not only as a result of this Grockbot uh experiment, but also we're seeing Nansen provide the tools for this. So, uh if you're technical, this could be something where you could do your own research, do a little bit more investigation, and set up uh agents that have assets that are trading on these things and actually profitable, making money in real time. Just with the prompt, make money. Don't make any mistakes. Let's go ahead and play the video. See how this works. No audio on this thing. And the funny part is that you can actually see the agents going to different parts of the

trading desk in real time. Uh, pretty hilarious. You can see the trades on the right. That's the tape. You go to the middle to actually make the trades. You got the sig sig uh signoid chart in the middle. You can go to the OTC desk. Go to the terminal. Go here. Check your research. So funny. So funny to see this. The funny part I think here is that these things are actually starting to make money, right? Uh it was Alex from Nansen that said, "Look, uh make money v 0ero which is this AI product from Nansen. I don't know if it's publicly uh available yet, but it is starting to

work. These things are be moving beyond just the early rendition of hey prediction market out arbitrage bot. That was early. Uh we're now seeing this actually play out in real time right before our eyes. It's actually seeming to work. These things actually make money. So very cool to see and I'm excited because I think this is going to be the new frontier. This is where these agents actually get competitive and uh we're going to see a lot more as a result of uh these agents getting a lot smarter and the custody solutions uh improving quite a bit as well.

Excuse me. Uh I'm allergic to not making money. Uh and I uh think that we're going to see these things get a lot uh a lot better. And so let's go ahead and uh flip to our next tweet before we get our next guest uh and our first guest of the day, Pedro, uh from the Salana Foundation as well. Uh we're going to cover a little bit of macro here. Drunken Miller was Besson's boss from 1991 to 2000 and from 2011 to 2015. Drunken Miller was Wars' boss from 2011 to 2026. I'm seeing a lot of conspiracy and I want to know from you guys in the chat. Hit us up on Twitter and on YouTube. Leave us a comment. Leave us a question. What do you guys want to know?

Because what we have here is this three-headed beast. Worsh in charge of the Fed, Bessant in charge of the Treasury, and Drunken Miller sort of playing the shadow uh Wizard of Oz behind the scenes puppet master. Right. Worsh and Bessant both worked for Drunken Miller. Bessant and Drunken Miller helped take down the Bank of England uh when their currency was floundering. And both of these guys worked under George Soros uh at the fund. And so um Stanley Drunken Miller has served as a mentor and boss to both Bessant and Worsh. Uh these guys all work together and now you have them leading different parts of the macroeconomic system. And so people are speculating that when Bessant made the

announcement, right, that he was going to supply liquidity from the Treasury to boost the bond market, this is what skyrocketed crypto off the lows. Okay, this is there's really no disputing this is what led to the bounce. It just so happens to coincide with the industry leaders in the White House and in the CFCC the next day. But this liquidity announcement is exactly what got us up off the lows. Now people are thinking that, you know, this isn't quite money printer on quantitative easing quite yet. Okay. What we have here is that this is pressure being put on the Fed. And we have an announcement, a big speech from Kevin Walsh in the next couple of days.

My co-host Andy is going to be on the ground reporting from Jackson Hole, Montana or Wyoming. Wyoming, kind of in the middle of nowhere, but it's beautiful out there on the floor with uh the Fed president giving the speech uh FOMC chair. And so we're going to hear from the ground floor what is happening from Kevin Worsh and how Treasury uh Secretary Bessant and Kevin Worsh are either at odds or working together to ultimately bring this uh this Treasury uh liquidity supply to market. Okay. And so right now the way I've been describing this, the way that I'm thinking about this is that they are preheating the money printer. You know when you turn on the oven, you're going

to cook, you got to preheat the oven. That's what they're doing to the money printer. They're preheating the money printer because they are about to cook and that means uh higher for longer. And so we are uh treating dips for buying. I want to know in the chat what you guys are thinking and how you're thinking about this market. We're just talking to you about our thesis here. And I'll tell you our thesis for outperformance here. It's a barbell. On one hand, we have monetary premium. Those are direct benefactors of this liquidity situation at a macro level which is transforming into an accommodative monetary policy.

Bitcoin Zcash ETH gold potentially Salana, all of these fit into this monetary premium thesis and that's what we're seeing. Okay. And then on the other hand, you've got this revenue meta. The rollup is who coined the revenue meta. We were a little bit early to this game. And so we've been tracking the revenue meta, the buyback thesis, the value acrruel mechanisms for quite a long time. Pump fund, hyperlquid, lighter, aerodrome, all fit this value acrruel thesis extremely well. Obviously, there is the trenches and then there's different confluence of factors here, right? We got uh this perpetual flywheel of market go up, more attention, more market participants. Uh those are guys who are uh into the

trenches, right? But at a high level, barbell is monetary premium assets on one side, revenue assets on the other. And what we have is a confluence of factors. Legitimization of the industry, macro liquidity, accommodative uh monetary premium and uh the um revenue meta and these things actually being valued on fundamentals. So, we're going to bring up our first guest uh Pedro. He's going to be joining us uh in just a moment and [snorts] we're going to bring him up and we're going to have a fantastic chat. Salana uh and pump fun are certainly on the forefront of this.

I see a lot of friends in the chat. Marty, head low. Good to see you. Greg is asking, should I sell my XRP and put it into solar ETH? That's hilarious. Uh we are going to not tell you exactly what to do, but we'll tell you that we're not big fans of XRP. We're big fans of chains that are going to be here for the next decade and continue to provide value in both the monetary premium world as well as the revenue world and support applications building on those chains. Uh plenty of buybacks and burns. Dubious rational, good to see you as well. Shadowman, uh plenty happening in the trenches and we're going to see some blue chips here that we're going to continue to talk about.

Uh I believe our first guest is ready. Uh, I think we got him all set up uh in the back. So, we're going to bring him up in just a moment. Let's go ahead flip the headline and get our first guest on the show. Uh he is part of the Salana Foundation, head of consumer at the Salana Foundation. Uh Pedro Miranda uh where he leads consumer growth, hosts the foundation's billions podcast, and he spent the past year interviewing founders behind Salana's breakout consumer apps from Pudgy Penguins to Collector Crypt, obviously Pump Fun as well. Uh current obsession is the onchain collectibles boom. We've been keeping track uh of this as well because it feels like this is a nonfgeable asset

class that could be ripe for tokenization. So, let's go ahead bring him up. Pedro Miranda of Salana Foundation. And there he is. Pedro, welcome to the show, man. It's a pleasure to have you. >> Thank you, Robbie. Excited to be here. How you doing? >> Absolutely. I'm doing good, man. I'm doing good. I appreciate you uh working through us our our process there behind the scenes and staying patient. And I'm glad that we got you here today. Um, it's your first time on the show, I believe. So, let's uh let's let's get into it. Uh, you host a show yourself in Billions. So, maybe you could just tell us a little bit about the lore behind uh behind yourself, how you found Salana, and uh how you made your way into the space.

>> Yeah, that's a that's a loaded question. In in terms of how I found my way into the space, I actually really wanted to be an economist of all things. So, I was studying global macro trends. um you know what people how people act in in certain communities and uh certain you know subs societies and uh I fell in love with this concept of ownership the notion that you know you could actually own assets from from real estate but also cultural assets and that's kind of how I fell into NFTTS as this ultimate social capital generating asset. So in in 2021 uh I was fortunate to join a

startup called Metiplex which originally ran the NFT infrastructure standard for Salana and now they power 99% of all token launches in the Salana ecosystem. Uh and from there my obsession of okay what else can we own that Salana uniquely enables that the traditional financial world couldn't. So you mentioned collectibles. Uh to me that the concept that you can own culture in various different expressions whether it be through uh owning a Pokemon card uh that you've had uh an obsession with when you were a little kid uh to also obviously these cultural uh I would say meme coins or meme stocks on chain is

extremely interesting and that's what we're doing in the Salana Foundation, right? we're we're seeing what types of expressions of of ownership is actually a 10x experience um relative to the traditional financial system. uh not only net new cultural assets but also you know traditional assets like what ways and venues can we actually uh make that really clear and pertaining to my my podcast I I just want to talk to really smart people and >> same here >> and and learn and it's a great excuse just to call up a Luca call up a Tam and call up a say from FOMO and say hey how do you view the world and why are you

building what you're building >> yeah it it is incredible I mean that has been a lot of the philosophy at this show as well is let's talk to people smarter than ourselves, bring them on and then we're just this amalgamation of everyone who comes on and we just continuously get to upgrade our mental model and our thesis when everyone presents us with new information. Uh so it's I mean it's a blast. It it is great to be here even you know throughout the bear. We've been here as you have been. We didn't pivot to AI. We've been here and now uh it's uh it's time to have some fun. And so I I think we've got a lot to get into. I want to get into the NFT things. I want to get into the the concept of owning one's nostalgia.

But before we do, I want to just talk about Solana's positioning in consumerism because, you know, there's been a lot of different perspectives on how blockchains should operate. Ultimately, it's a very general technology that can support lots of different use cases. We've seen blockchains go after finance. We've seen blockchains go real world assets and memes. Some have these two wolves f some focus on one or the other. Where is Salana's positioning right now given the success of consumer applications like pump fund like FOMO like collector crypt? What is the positioning of Salana in a nutshell in 2026?

>> Yeah, it's a it's an amazing question and you actually talked about a lot of assets that I call the the horseshoe theory of asset adoption. So you're seeing an increase in uh tokenized treasuries for example onchain and salon is leading adoption pertaining to tokenized equities but also on the other hand right you have the entertainment finance thesis uh happening in the global macroeconomy and Salana is the the impetus of this for crypto uh on FOMO for example uh the net new celebrity or or the net new celebrity is going to be the new trader right? Uh finding an asset early or publishing a thesis about it. Uh so uh a blockchain such as Salana is not just about the the

tech. The tech is going to continue to improve. It's increased bandwidth, you know, reduce latency, but it's also the culture and the network effects of a general purpose blockchain such as Salana. Collector Crypt is an amazing example of that horseshoe thesis where you have folks owning their nostalgia, so to speak. Uh, but as a result of being on chain and be able to tap into, hey, other apps and other developers, you can actually lend against your Pokemon cards and unlock liquidity that you would have never had in the real world or you would have to go through some weird OTC deal. Uh so by leveraging you know Jupiter lend and collector crypt you unlock this really interesting

consumer experience and Salana is an expression of that throughout its time. FOMO is a great example of they're leveraging Salana as a social graph in [snorts] the sense where the trades are information that they're expressing within that application. Uh so we're going to continue to see from the consumer perspective Salana evolve as not just an exchange but a a global network state where people can plug in liquidity uh the same way that they were just browsing the internet uh you know a few years ago >> and and I'm curious because you spent a lot of time thinking about this. What is your mental model? We've heard a lot of people talk about this phenomenon in a

few different ways. Some people call it monetizing attention. You know, people call it the attention economy. You you you know, I've heard you call it, you know, owning their the nostalgia, right? And in in a variety of ways, these things are all correct. Whether it's something that has persistent attention and nostalgia and kind of, you know, a timeless element to it, or it's something that, you know, is kind of viral in a moment, uh, like a memecoin and it captures a ton of attention and then that attention ultimately subsides. Either way, this is, you know, a fun mechanism and vehicle for people to express their interests, for society, uh, and and culture to express itself.

And so, what, you know, is your perspective on this? What is your mental model? What is your framing for how we should think about, you know, collectibles on chain, these productive assets, meme coins? What is the right way to think about these things? Yeah, the the thing that excites me the most is for the first time we have a proper way to value attention. And that is something that traditional finance, whether it be through a a common DCF or what have you, has never been able to uh to do before. So, a good example is the the Clanosource team through Hebrew.

They're doing a raise uh for their token sale using Metapplex right now. That's a team that's essentially saying, "Hey, listen. Super fans have value and contribute value to their IP ecosystem, whether by watching, whether referring friends or contributing to their own story lines. But that value has never been tapped in before besides maybe a, you know, ad targeted ad for a $5, you know, free movie ticket or what have you. So the ability to value attention on chain in a liquid fashion is really fascinating and a 10x experience in my opinion where super fans can actually get the value back that they're creating

for ecosystems such as clinosaurs or creating liquid markets for collectibles and Pokemon cards. uh not only for Pokemon cards but also niche tail end uh indie stories is going to be a really interesting market or games for example. Um and then the memecoin element uh I I I find is is not actually cyclical. Um I think it's actually going to be here to stay when you look at you know trends that are actually happening outside of crypto. A lot of times uh when I see you know new tokens being created you can actually see see the tickers and see what is happening in the world before

actually reading the news myself and I find that so powerful the same way with prediction markets world.xyz XYZ which is a Salana native prediction market embedded into Phantom itself. Uh the same way prediction markets are doing this where people are looking at charts before they see the news and you're actually going to see a lot of those throughout different asset classes in in the consumer space and that's really exciting to me. >> Yeah. You know, I uh I I respect Pump Fund in particular because they've been able to create the horseshoe that you described earlier with respect to Salana generally, but also, you know, Pump Fund has been able to create such a, you know, distribution channel and monetize that, but then they also have, you know,

the tokconomics with the buyback model, uh, that I think the market is valuing these days. Um, you mentioned, you know, you don't think meme coins are cyclical. This has been the retort to Pump Fund in general is that the revenues aren't durable and that's why it's trading at such a low like price to earnings or you know market cap to earnings ratio. What is your thesis here? Why do you think memecoins is not a circular cyclical uh uh trend? >> I I I view this in the macro again. I I think of that quote I think it was an IMF paper where it's you'll own nothing and be happy. There's just a financial nihilism in the younger generations where uh there is this weird going back

to this horseshoe theory of a as more and more things become unaffordable in a in a day-to-day basis they're going to look at what can we actually own from a digital perspective right and I think whether it be Tik Tok trends which FOMO has been doing an amazing job from a user generating user generated content perspective hopping on trends uh early identifying the value of them or whether it be content creators. I I'm still amazed that for example you're still you're starting to see this but um I that I can't call or invest in an early content creator and I know a lot of those are regulatory headwinds and finding out the the right model for that. Um but that's also something that

is really that's really exciting to me. Uh but I think there are macro forces that are going to continue to propel memecoins uh forward uh in this industry. >> Yeah. And you know I I want to I I think that's a a great segue actually because I wanted to ask you about Anom's token. You know he's a content creator. He's been on you know for for uh quite a while in this industry. And I want to tell you my, you know, perspective or or reaction to what he's doing and get your thoughts on it as well. Because when I kind of read his thesis, it sounded a lot like Mr. beast who, you know, basically has uh this uh flywheel where people watch his videos, they get a chance to go and make money on his

videos and then he gets a lot of money just from the the AdSense of, you know, these social platforms like YouTube paying him for to create these videos and then he recycles all of that pretty much back into his videos and gives away more money and then the cycle continues. Um, and then he's been able to just create a a you know, juggernaut of a business, you know, has investors all across the board. When I first read Anom's thesis, it sounded a lot like Mr. Beast's thesis, but he cut out the middleman. He cut out the YouTube and he just has the people, the fans pay him directly and then he recycles that directly back into the fans. They don't need to watch YouTube and then YouTube pays, you know, the content creator like Mr. Beast and then he get gives it back to the fans, you know, cuts out YouTube,

cuts out the middleman. Is that the right way to think about this? like this is essentially monetizing a fan base but cutting out the middleman. Is that Anom's thesis here with his token? >> I would say yes. And I it's more it's more nuanced and sustainable than that. It reminds me of the the creator coin meta with Zora, which I actually I actually value and the experimentation that they've done uh to this day. But the Anom creatorcoin ecosystem is extremely interesting from the perspective that he's also building up sustainably an ecosystem where projects can actually tap into his IP which is really fascinating. Whereas

the Mr. Beast ecosystem doesn't have that incentive today. Actually, it's it's the opposite. It's it's almost latigious in some respects to build off of a uh creator IP. So, there's an incentive alignment to grow the the IP and the creator branding, which I'm just very excited about. And I I think you make a point, an interesting point about what happens to platforms, what happens to to middlemen. And I I I think it's the Pump and the and the FOMO thesis where uh I see FOMO as a social network >> and they're going to to grow at social first in my opinion and pump also offering the service to their own

creators. Platforms are going to have to evolve in terms of the values that they're giving back to their creators whether it be uh creator callouts uh or rewards. Uh and and I think they're going to give their incumbents a run for their money today. That's why you're seeing a lot of uh trader uh big web two traders uh come on board from a content creating perspective. >> Yeah. And I think they're starting to realize it. I I think there are some more nimble and and uh faster moving social platforms that are realizing it first, but I think like X I'm sure you've saw you saw this like they let you trade but you have to go to the different platform. It's just a matter of time before they integrate it directly, right? and they realize that they have to innovate or else they will

be disrupted by the social trading experiences that you're talking about. >> A thousand% X is the ultimate uh developer of financial intent in the world and it makes too much sense for them to to go closer to that how that financial intention is actually being developed. That's also why from a from a cash tax perspective, Salana was the first uh blockchain with uh complete coverage of of token addresses on X. That's also because a lot of the financial intention that we talked about today in terms of in terms of the trends is actually being developed on Salana.

So, I'm very excited about how X and other platforms are going to capture that financial intention. uh whether it be through trading or call outs uh it's going to look very similar to what FOMO is doing and I'm just intrigued to see how that develops. >> May can you just speak to the to the rise of FOMO and the success of FOMO because you know we see the the pump FOMO the similarities and the differences and the competition between the two. Maybe you can just and and I think there was a lot of people that you know they were here for the rise of pump fun whether they loved it or hated it.

You know it was a very contentious thing as it kind of rose to success. people saw it, they they now understand it. No matter their feelings towards memecoins, you know, they they understand Pump Fun. Can you describe the the unique differentiator of FOMO relative to Pump Fun? Is there room for both of these in the market? And maybe you can describe the competition between the two. >> I think it's I think it's awesome that there is the competition in the future of entertainment finance is happening on Salana. It's a privilege at least personally to see this the battle of the greats happen on a day-to-day basis and mostly on on Salana is where the innovation is happening where the user activity is happening but also uh I I

think users benefit here whether it be through incentives rewards uh or just fee compression users are are benefiting across the board it's interesting because um pump feeds a lot of obviously tokens into into FOMO right? Like FOMO traders are trading pumpgenerated assets in a way. So I think it's I I I think it's more so a strategic question of one is FOMO going to continue to be social first and what does that mean from an an onchain perspective? Does that mean it's it's an aggregator and they're going to they're going to add, you know, are they going to add comments? Are they going to add kind of likes, more social graphies features or

are they going to lean into more so the trading side? Whereas from Pump's perspective, it's kind of the opposite question, right? Are they going to focus on on continue to focus on asset issuance and generation? >> Um, so I think those are the two core differences. Uh, and they're pretty complimentary on paper to each other. Uh, but it just depends on, you know, the TAM. I think the pie is still small, too small for, uh, anyone to be competing with each other directly on a long-term basis. >> Yeah. And I mean the the same thesis that you described earlier about why these things aren't cyclical, right? So, you know, just the the monetization of attention as people, you know, continue to spiral towards this future of, you

know, owning entertainment, owning this uh this nostalgia, owning attention, it, you know, these the the uh particular attention pieces, you know, whether that's a viral meme or a content creator, those mo might go in and out of favor, but the the fact remains that attention is going to persist. Uh nostalgia is going to persist. these highle concepts and these are the platforms in which you can own those ideas and those concepts. >> Yeah, it's extremely valuable, right? I think valuing ideas, attention, beliefs is net positive for society. You can ascribe know how much economic value there is to to these beliefs. Uh and I

think you're going to see some interesting innovation. That is kind of my request for startups here is you know tapping in. And I know people are even looking at I prediction markets and memecoins for you know for political elections right and kind of seeing how that surface is moving. Um crypto as a whole today is also a higher LTV user than I think the the general uh world. So it is an interesting subset to kind of see what these high LTV traders are actually thinking on and actually believing.

>> Yeah. Um and you know you spoke to sort of like which way you know the these platforms are going from an app perspective and we touched on it early on about Salana's positioning right with this horseshoe. Is there a particular way in which Salana is going to be leaning? Are you guys going more tokenized equity you know onchain NASDAQ these sorts of things or leaning a little bit more? I mean you are head of consumer there at the Salana Foundation. So I I feel like it's your job to sort of push the ecosystem in in this consumer direction, but how do you see the uh the positioning of Salana continue to progress over you know this upcoming cycle? It's so funny you mentioned that u because obviously the uh obviously the yes the natural role

extension is is saying yes of course the fun assets right on Salana today you can uh collect you can tokenize fossils through Jurassic and actually own a piece of a dinosaur which is insane we we talked about collectibles uh there's a bee market for like actual bees that you can own so I think net new asset expansion and on the creative piece you know, owning a piece of a creator of an IP and engaging in that IP will continue to grow from an asset issuance perspective. But it is also my uh mission so to speak to to make traditional asset ownership sexy again.

I think what's happening with uh with backpack and sunrise which effectively is uh you can buy for example a biotech stock on Salana or silver or oil uh and it's a fungeible permissionless token on Salana you could trade it one to one for the actual share and send it to and from your brokerage that's amazing that's really cool you can tap into the composable ecosystem of Salana lend against it um do a lot of interesting pairing against either a memecoin or another stock. The amount of primitives are like the design space is is wide open. So while I call them traditional assets and while I call it this

horseshoe theory, what I what I think is that it's it's all entertainment finance. It's all net new expression of boring assets that we haven't had the ability or the technology to do so yet today. And Salana uniquely enables that. And do you think that it's possible to create an ecosystem where you get the best of both worlds? Because what I'm what I'm understanding is like the breadth of assets, right? Salana is like where net new assets become where they come into existence. Is it also possible to be the deepest liquidity and the best price execution for some of you know the more traditional assets both cryptonative assets and you know the the

traditional equities? Can you get both the depth and the breadth? >> It goes back to the macro. Absolutely. I think so. So, I'm based in New York City. U I've had the pleasure of, you know, a lot of my my friend group uh they work in traditional finance and their their [laughter] assets, their portfolios look like a a horseshoe theory, right? It's it's your it's your S&P, it's your gold, but it's also prediction markets. It's also uh creators. It's also uh like, you know, I've got someone to to buy this, you know, tokenized fossil, right? It's that's where the macro is headed. It's this notion of okay, we can't own a house uh as fast as our parents. Uh what

else can we own? So I the macro answers that question and Salana uh saying that it's uh just an everything exchange is actually constraining the TAM of what we're doing because we're also a major ecosystem for applications and users to build on top of that everything exchange and that network effect is going to be extremely valuable for this horseshoe theory that we've been talking about. >> Yeah. Yeah. And I had someone on yesterday talking about the you know there there's this massive TAM and you can kind of project out the the potential growth of that that TAM as it expands. But then there's also the things that we can't really predict the the non-skeumorphic things that aren't

really in the domain of just this growth that we can foresee. There's things outside of that that we can't foresee that are actually additional network effects because we don't know what it's going to look like when we get, you know, uh, price discovery for tokenized equities that actually beats price discovery on interactive brokers. Like we didn't know, you know, Fossils, I think, is a great example or bees. Like what happens when you get, you know, a liquidity pool between Fossils and bees and that's paired together and then you have them both in a vault? like there's new financial primitives that were previous that previously didn't exist and so we couldn't really understand what the potential flywheel and wealth effect or network effects of those

things are but as those start to compound it's sort of like you know imagination is the limit as far as what these things can do and then you know that that ultimately gets you know taken exponentially as it compounds further and I just I mean I can't help but you know look at salon as a place where there's been a lot of ingenuity a lot of you know financial experiment mentation and creativity and I think that's one of the most powerful things that the ecosystem has to offer. >> Yeah, you you said it you said it yourself, right? the the financial experimentation and innovation on Salana is is a privilege to be involved and also on the sides for uh you mentioned kind of shocks or external events and you mentioned bees and I I thought of uh I thought of impacts to climate or just

changes in the climate for for bees or someone on Salana um going to be announced at Breakpoint actually is tokenizing regenerative soil. So what happens when you actually can have access on a retail level uh to these assets and express express a thesis or a trade idea of where you think the world is going in a more accurate way uh that isn't just you know buying a climate index or uh you know shorting a particular stock I think that becomes really powerful and it gives agency to retail and institutions.

Yeah, I I got just like one or two more questions for you. I know you're probably tight on time, but it it does come up in my mind like how these asset classes will evolve because they are entirely new like we haven't been able to trade fossils in a liquid market before. Have you seen demand from market makers are like are these traditional players that are now in entering a new asset class or are these entirely new market participants? they weren't previous market makers and now they just happen to have industry expertise that are entering this market.

>> I view oh that's such a fascinating question. There's two directions that we can take this one or or two examples. Uh one is prediction markets where you're seeing uh the larger market makers actually come on board alongside retail. And then also second is the collectibles market where you have inventory for card management uh also having they're not market makers so to speak but there are large card collectors or actually institutions expressing a view and purchasing uh you know 10% of a specific Pokemon card or something uh just because they have a thesis about that.

Uh and for me for example I use collector crypt. I purchased all of the the Pokemon cards that I had this nostalgia for. So I had my Ldioses, my my Charizard and I have that on chain and I could prove ownership and I'm sitting alongside you know that fund who is expressing a view or thesis of the world and I I think you'll see that for different asset classes. Obviously the the liquidity model needs to be correct and you know Salana from like a prop AMM structure provides a more efficient liquidity model better pricing etc. That is going to be really fascinating to just express or impose that efficient liquidity on assets that have been

illquid for such a long time. And you're going to find out new information, right? It's the ultimate truth market of what is something actually worth. Um, and I think retail is going to have some different opinions on, you know, either they're gonna they're going to own own bees because they love they love bees or hey, listen, maybe there's like a climate change trade that someone wants to express. >> Yeah, I I love it. And I think you're you're absolutely right. Um, that this is again, you know, these horseshoes just continue to present themselves. Um, last thing I got for you is, um, you know, everyone wants something to look forward to, and I'm not going to ask you for price predictions or any of that kind of stuff. Um, but I'm I'm curious like as head of consumer at the Salana

Foundation, what is the next milestone that you have for the consumer ecosystem on Salana for these consumer applications? Is there a milestone in terms of daily active users or or you know amount of activity or anything that you can point to as your north star that you're looking to hit in the near future? >> It's a it's an amazing question. Of course there there are quantitative metrics that we look at. Uh but I don't want to constrain actually to the crypto cycles. So my main metric is essentially countercyclical right you could actually plot ma of blockchains to market cycles pretty elegantly I want to see a inverse correlation of that breakout so that

there are actually net new users ma to salana applications from collector crypt uh to fomo and others uh that are inversely correlated with the market and you're also seeing that with a lot of these teams are are maturing and they are actually conducting ad spend on on Facebook, Instagram, Tik Tok and bringing in net new people. I want to see that reflected in the data. I think that's going to be a breakout and maturing moment for the Salana ecosystem. We have specific apps who have that inverse correlation or breaking out of that uh price and market driven correlation, but I want to see that for the entire Salana ecosystem and

the consumer ecosystem as a whole. Yeah, love it. Pedro, you're the man. Appreciate you coming on. Uh we gota we'll I'll go on your podcast, you'll come back, we'll we'll keep doing these mashups and uh yeah, I mean you you're absolutely crushing uh on the consumer application ecosystem all over Salana. Um I mean it's it's a pretty clear leader at this point. So uh I think you earned a raise or at least a good soul pump and uh best of luck and uh really appreciate you coming on today, man. >> Thank you, Robbie. I'll see you in New York soon.

>> Absolutely. Let's do it. Catch you later. >> All right, >> we're going to keep things moving. Uh Pedro, rockstar guest. You can tell this guy's a pro. He's been here before. Hosted his own show. Go check it out. Billions on Salana. Um and we're keeping uh we're keeping the show alive. We're uh bringing you guys everything that you need to know across ecosystems. I mean, next guest is a rockar in tokenization, Robert Lesner. This guy's been here a long time. uh true OG in the Ethereum DeFi space. They're bringing one OG leader of consumer in Salana all the way through to a true DeFi OG on Ethereum.

Uh the rollup is truly doing as the name suggests, rolling up the best in the business, bringing them direct to you guys. Keep us keep us going in the chat, fam. Woomerick, Greg Sosa. I love these handles. I mean, you guys rock. Freedom guy as always. Mr. Elena Don. Uh some new new names and uh some old friends in here. New type. Good to see you in here as well. Go ahead. Send uh send in our next guest. Let's get the animation going and we're going to bring uh up with Robert Leshner of Superstate on Stabled Up episode 47. [music] >> [music] >> Welcome back to another episode of

Stabled Up, our premier weekly show covering the ins and outs of digital dollars, stable coins, and the future of decentralized finance. The >> show is made possible by FRA and FRA is powering the financial engine of the internet, powering FRXUSD and genius compliance stable coins. This is the stablecoin super cycle made possible by FRA. Now enjoy stabled up, our weekly stable coin show. >> [music] >> Stabled Up episode 47 here on the rollup. We are here live with Robert Lesner, true OG in the space. And uh Robert, we've had your co-founder on the show several times. Uh we were we've been here since the old compound days and so uh I I don't know how we haven't

made this happen uh uh before now, but it's a pleasure to have you, man. >> Thanks. I'm the bashful one, I guess. You know, [laughter] >> it's all good, man. I'm glad I'm glad we made it happen. Uh Superstate is absolutely crushing. Uh we we chatted with Jim when uh uh I believe it was Invesco kind of took over the last fund and you know you guys were able to make a smooth handoff which is very very cool. Um and so on today I know this is stable coin segment. Uh you guys are uh powering this fund OS uh Coinbase stable coin yield fund. So there's plenty to talk about in this world generally. You guys are uh leaders and front runners and pioneers in the tokenization space.

So, just speaking about tokenization broadly here. I'll tell you this thesis. I think it's a good place to start because it kind of opens up a lot of what we're seeing play out these days, which is that we're in this tokenization super cycle. We saw industry leaders shaking hands with the president of the United States up there with the leaders, the CFTC, leaders of regulation here. And ultimately, this is legitimizing the industry. We're seeing the biggest financial institutions now have FOMO coming into the space and doing it at record speeds. And then all of these tokenized assets end up propagating across all of these blockchains and end up in the DeFi protocols that have been here building making these resilient systems from the very beginning. Now they're doing that for the largest asset

classes in the world. And so that's kind of what we're seeing play out. I'd love your your take on this, your perspective, and just, you know, a little bit as far as what your mental model is for how the tokenization thesis is progressing. >> Yeah. So, first off, good thesis. I generally agree with everything you said. We are at the beginning of the maturation of tokenized assets. What does that mean? you know, beyond all of the industry leaders being on stage shaking Trump's hand and talking about crypto and tokenization. We have, you know, the leaders of every bank and every asset management firm on TV talking about tokenization.

You know, this is the chapter one and a half moment, I think, for this. There's a lot of pilots out there. There's a lot of proof of concepts out there. Everybody is building products, some of which are starting to get traction, but it's still incredibly early, right? Almost every single bank has announced they're doing tokenized deposits. Like literally pick any name out of the largest banks, they're all doing tokenized deposits, right? >> Yeah. >> They all want to use that as a stepping stone to do tokenized securities, right? Tokenized more complex products than a deposit. You have every asset management firm out there, right? From Black Rockck and Vanguard and Fidelity all the way down, all of them are interested in this, right? So the question is not like who is interested, it's who's not

interested. And anyone on that list is a dinosaur and they're going to be out competed and they're going to go to zero fundamentally, right? Almost everybody that matters in all of finance is interested. And it's because over the last eight years we've proven out, you know, hey, tokens on a blockchain that are programmable are amazing. They can do interesting things. They can settle instantly. They're super transferable. They're programmable. You can put them inside DeFi protocols. You can open up access around the world. You know, there's a lot of like edge case things to figure out, which the SEC and the CFTC are totally on top of to iron out the last like gray areas of this, but we're very quickly coming to the point where it's all proven and now it's just the time to go go and everybody is

lining up on the starting line to go. >> Yeah, absolutely. And and we'll get into Superstate's product stack, how you're working with some of these financial institutions and how you had the foresight to ultimately recognize this and build for that future. But I just want to give some color to the point that you made about the levels of adoption that we're seeing here and and at the bank level, the the progression from tokenized deposits to tokenized equities. And today, literally this morning, we had Bank of America, Wells Fargo, Santander, and over a dozen major banks move forward with plans to launch a stable coin. And so I'm curious just you know because I feel like you might have insight where you know uh some of us don't. How do you foresee these

banksponsored stable coins moving and and partnering and working their way through the market compared to what we've seen up until this point which has been a a complex sort of experimentation process of algorithmic stable coins and decentralized stable coins and then ultimately to the duopoly of you know circle and tether today. How do you see these bank sponsored stable coins entering the stable coin market? >> Yeah, it's a great question and I don't have all of the answers, but I do have analogies to work with with like, you know, historical patterns. So, if you zoom way out, right, like back in the 90s when the internet and the worldwide web were pretty novel things and every single bank offered its services not on the internet, right? They were 0%

online. You know, as the internet and as the web came out, everybody was interested. There wasn't a single bank CEO who was like, you know, going on their earnings call and bashing the idea of the internet. In fact, they all said like, "Hey, we want to figure out how to leverage this, right?" The ways in which they leverage this over time, you know, it started off where they're like, "Hey, we're going to have an internet portal for you and like, hey, eventually it's going to lead to like a zel and like all of these things. But at this point, we have 100% adoption. There's not a single bank out there that's not completely scaled entirely into we use the internet to deliver banking because it's faster, cheaper, better 24/7ish, you know, and just fundamentally better.

Crypto rails are just the next evolution, right? And it's just as transformative, especially for any money services, security services, any like transfer of value. Crypto is equally as transformative. And so, you know, what does the end state look like in 20 years, right? Well, probably every bank, probably every asset manager, probably everybody on Wall Street, probably every investment advisor, probably every portfolio, probably every user on their phone, probably everybody everywhere somewhere is using tokenized assets, right?

>> What are the killer apps, right? You know, there have been a there was a lot of different ideas about how to build a web portal for people to use internet plus money, right? And there's still experimentation there. It's still not figured out, right? Every year there's like something that's slightly better than before. I can't tell you with a, you know, crystal ball exactly what it's going to look like when tokenization has scaled, right? Do I think the end state is that there's 30 successful tokenized deposits like Bank of America's a tokenized deposit and JP Morgan does and Wells Fargo does and they all are successful while they're all competing with each other. Probably not. I don't think that's a viable end state. I think there's probably going to be, you know,

a federated deposit stable coin where like 15 banks all get together and like have one that sort of wins. I could see a single bank on their own succeeding at scale like a Bank of America or JP Morgan potentially. I could see, you know, a hundred different approaches to tokenized securities. That's a really big umbrella, you know, scanning, you know, everything from like tokenized equities to tokenized private securities to tokenized real estate to tokenized alternative assets that their clients use to like everything in between. >> The things that take off and are sticky and like really work has not been proven yet. Everyone is throwing irons in the fire, >> you know, trying to put some fuel on it and trying to see where the actual product market fit is. Right? that goes

from startup to the largest bank in America. >> Yeah. Yeah. Um I I mean I think it's extraordinarily well said because we've still it it also reminds us that we're still early. Like we all sort of have this general directional thesis that this is going to be the end uh the endgame. This is where we're headed. But how we get there and which things ultimately are kind of the thrust, the gasoline, the acceleration that do get us there, that is still very much up for grabs. Um, and there's, you know, a several different facets in which, you know, there are players that can fit into this market, ultimately provide the infrastructure to build out this onchain economy, this tokenized world. But it's

still very much fair game as far as, you know, what are the major pieces and which ones are maybe the minor pieces. The total addressable market is massive when we think about this thing at scale, but we aren't really sure which ones are going to be the bigger wedges. And I think that's where I want to get into Superstate's product stack because you've, you know, kind of, you know, laid your your flag in the ground, put, you know, uh, claimed your stake in this tokenized fund world, a little bit in the stable coin world, but, you know, you've spent plenty of time thinking about this thesis and what this landscape is looking like and have thrown some irons into the fire yourself. And so I' I'd love, you know, your experience and and and so what are the irons that Superstate has thrown

into the fire and what has your experience been with the adoption curve of of those things? >> Yeah. So, first off, I'll say there's some unannounced things that I can't talk about yet, but over the coming weeks and months, you know, hopefully there's new products that we can talk about, but as of today, the big bet really is on a platform called Fund OS, right? Fund OS is an operating system for super modern tokenized funds to operate, right? Funds that could be a private fund like you know a hedge fund or a venture fund or something that holds assets only for qualified purchasers. It could be a public fund like a mutual fund or an ETF. And the very first prospectuses by some of our partners been filed with the SEC to bring public funds onto fund OS and it

can be novel structures eventually. you know, we're going to start to see things that don't look like ETFs or don't look like traditional mutual funds be tokenized as a security on a blockchain that people can buy, sell, subscribe to, redeem from, totally composable with DeFi, right? And so this is an area that we've seen, you know, a lot of demand. We have, you know, a number of the world's best asset managers working with us right now to tokenize their products. We have a huge pipeline that we're working through of other absolutely incredible asset managers that want to build tokenized products themselves and we built built out the platform to do this at scale, right? And so, you know, if you boil down like what is this type

of security under the hood, if you go into like the archaeology of like how the traditional finance side of this works, there's like a lot of pieces there. What we've done is basically built a software and technology system around the way funds work under the hood to make them tokenized to enable them to just be a token that works on a blockchain. It still has like compliance. It still has recordkeeping and still does tax and still does all of these really annoying things >> and the end user just says, "I have a token. I can put it into like a horizon and toss it." Like it works the way I think it works.

>> Yeah. And and so I take it that there's a lot of complexity underneath the hood uh when it comes to building out this this tokenization infrastructure and the smart contract infrastructure. And I want to actually ask you about how gener how you made this system so generalizable because security you know these tokens these funds are so complex. First, I actually want to ask you what I think might be even more complex, which is the regulation part of this, which the SEC is, you know, now helping to accelerate and make a little bit more clear, but you know, how have you, you know, been able to navigate, you know, building out what are, you know, colloally, you know, are securities like building that out on chain? Have how close and important has the SEC been as

a partner in building out this ecosystem? >> Yeah, it's a great question. Um, everyone has their own approach to this. We've historically and maybe it's because you know everybody in the industry is so battle scarred from the Gary Gendler era right some people have taken that lesson and gone totally wild west and some people have taken that lesson and gone you know relatively conservative the superstate approach has always been conservative because it's always been with the world's largest institutions in mind who we wanted to sort of be our partners and so you know we've done the hardest thing which is how do you take a fund and still adhere to all of the compliance and regulatory and like stuff that nobody wants to deal with. How do we make it where you're still compliant with everything? And yet it's a token that can do really cool

things. It can go into smart contracts. It can be programmed. It can do all of that. And you know, the way we've gone about this is by being conservative by saying like, hey, you know, the funds on our platform have to either be exempt and we're going to enforce that. So it has to be only like accredited investors and qualified purchasers and we have to check all the docs and we have to do this like song and dance that is pretty annoying or it has to be registered which is what the SEC wants. They want everyone to like register new funds.

They want people to try to bring the market entirely new products that don't look like things people have seen before. You know they're not saying everything has to be a mutual fund that looks like things we've seen or everything has to be an ETF. I think there's going to be registered vaults. There's going to be registered DeFi native securities. There's going to be registered tokens. There's going to be all sorts of stuff over the coming two years that we haven't seen before. But our approach is like it has to be fully legal right? >> Yeah. >> What that is can get weirder and weirder and weirder and will get weirder over time in a good way. But we're maximally conservative there. Now, what we've done is built the system to enable all of that hard work under the hood.

And yet the token is still awesome. And so, you know, the really complex thing that we've solved from a technology process that most people don't even understand is sort of like what happens under the hood, >> you know, when we have a tokenized product that we vision, right? So, what happens under the hood is when we're creating a tokenized fund, let's just call it like USCC, which is like a high yield basis fund that on our platform at this point. It's managed by Bitwise. It's a really cool token. It's integrated into DeFi protocols like a horizon and morph.

We record the owner of everyone who holds this fund, right? This is like what some people call an allow list or a white list. We call it an allow list. You know, everyone's wallet is on an allow list. And behind the scenes, you know, compliance has mapped out, you know, here's who you are. Here's Robbie and here's Robbie's three wallets, right? And so anytime there's a balance in those wallets, we know, hey, it's Robbiey's, right? We know it for tax reasons. We know it for compliance reasons. We know it for all this stuff. And it's integrated with like the funds back office, right? This really boring world of like, you know, back office things like the fund admin knows it. The custodian knows it. It just all works, you know, in harmony.

Now, normally that's where things stop. It's like, oh well, you know, you know, we can't lose track of it. How do you put it into a DeFi protocol? How do you put it into a pool? How do you let it leave Robbie's wallet, right? And do more interesting things. And that's where we've built out some really, really, really fascinating technology where we actually allow it to leave your wallet and enter a DeFi protocol if we have the ability to sort of see through the DeFi protocol, understand how it works under the hood and continue to track everybody's ownership and balances in that protocol even as things happen. So with a you know a lending protocol, you know, we can like add support for lending protocols like Morpho, like a etc. And the way we enable that is because we've reverse

engineered it from an accounting perspective. So like when you like supply it as collateral, we're like, "Hey, it's still Robbie's. It's just being used as collateral. If you got liquidated, we say, hey, it's no longer Robbie's now. It's Joe the liquidator." So we track every log and every event in order to keep these like records fully synchronized. And so anything that happens even like in a pool that holds a thousand investors tokens all together and it looks like one address, we don't view it as one address. We view it as every individual beneficial owner of the tokenized security in real time. So every event that happens flows through the accounting and the recordkeeping and the compliance and like the tax and all of that nonsense, right? And you know when you have an AMM it's the same way.

It's like it's all pulled together, but we look inside, you know, every LP position, we say, "Oh, well this is exactly how much each LP has." And every time there's a trade, it's modified just a little bit. So there's this, you know, incredible harmony between like a DeFi protocol and a tokenized security that lets us take this really complex thing which is how do you have compliance plus DeFi and do it without making either suck? And you know, I I was going to ask a question about going from, you know, uh, the old compound permissionless DeFi days where it felt like everything was wild west, runand gun to, you know, what feels a lot more buttoned up, you know, like regulated compliance accounting world. But I take it what what drives

you is making these things digestible and and understandable, making the complexity not so complex. And you've actually been able to find something that's really exciting and and by opening access to a world that was previously closed just doing it actually for a more fundamentally sound asset class. >> Yeah. And like my philosophy is, you know, I have seen the way all DeFi protocols are built, right? Like I actually hate the idea of permissioned DeFi protocols. I actually hate the idea of like let's just make a compound or an a or unis swap worse, right? Like [snorts] that's going to fragment liquidity and do all these like lame things. I actually hate that idea, right? I think, you know, the north star that I have is how do we let protocol developers continue to have totally open

protocols running on totally open blockchains and inside those totally open protocols on totally open blockchains, you can use permissionless assets and you can use permissioned securities where the permission is at the asset level, right? It's not. >> That was my next question is is that it's at it's at the asset level. >> Yeah. Exactly. Like >> you enforce these these compliance and accounting standards. >> Yeah. I don't want to have to call one of these DeFi founders and be like, "Hey, can you make like a really lame fork of your protocol, right? That like you're >> people have made those calls."

>> Agreed. Agreed. Right. And like that has been a school of thought about how to accomplish all of this. Like the the really hard thing we're doing at Superstate is like how do we allow people to design the protocol they want without any changes? And when a superstate asset integrates with it, all of that stuff is handled and the DeFi protocol doesn't have to make itself worse. >> Yeah. Um, Robert, I I I I could keep this going all day. I want to I want to um get into maybe just a couple case studies to round this out so that people can really rationalize what you're saying because sometimes I find that it's difficult for people to really comprehend when a protocol is so generalizable until we get some case studies. Uh this is the uh stabled up segment sponsored by our friends at

Frack. And so I I understand that you you and FRA are working together on a couple of these funds like the the short duration US government fund. Frack uses superstates uh treasury fund as actual reserve backing asset. Also working together on some of these crypto carry funds and whatnot. And so maybe you could explain the case study between superstate and frack as one example of how these protocol functions. Uh and then we'll get into a couple more case studies here. >> Yeah, absolutely. Um, I'll start with, you know, explaining the simplest way I can. You know, the first product that Superstate ever tokenized was a token called USB. You know, when we first launched it, it was the Superstay shortduration government securities fund. It held T bills. Eventually, it

became the Invesco, you know, short duration fund, you know, that holds T bills, but it's a fund that holds T bills that is a token on the blockchain. And this bucket of tea bills. This fund investors can create new shares of using stable coins and redeem for stable coins. When they do that, you know, behind the scenes, and this is the magic of tokenized funds and all the back office and all the things I was trying to gloss over before, you know, when someone buys shares of this fund, the stable coins become dollars. The dollars buy actual T bills, you know, from the government or from a bank or from the open market. And when they redeem, those actual T bills are sold. It becomes dollars, it becomes

stable coins, it goes back to the investor. And that process of buying and selling shares of this T bill fund happens. It can happen offchain. It can also happen onchain. We've built out these really cool, you know, smart contractbased, you know, systems for even a D5 protocol to buy and sell to subscribe and redeem from this product, right? So a DeFi protocol doesn't have to like click on a website. They don't have to do any of this stuff. They just say, "Hey, I want to create new shares of this fund or I want to redeem shares of this fund in stable coins." And it all happens at DeFi speed.

You know, these subscriptions are instantaneous. These redemptions are instantaneous. It's essentially one Ethereum block, right? Um, and so Frags is able to use this building blocks, this building block of like a key bill fund that's tokenized as a core part of their stable coin product, right? And it's fully programmable. You know, FRA is able to build smart contracts that interact with this. behind the scenes is this full like USDC to actual T-buill flow that's happening, but they just see a smart contract, you know, solidity interface to it where they're like, you know, subscribe, redeem, you know, there's like oracles and price feeds and all of these things and it all is just composable with their

stable coin and their contracts themselves. And so, you know, we've basically abstracted away this process of like buying actual T bills, putting them into a fund >> and made it just a smart contract call for someone like Frack. And that enables them as they want to scale the supply of, you know, FRAUSD, it's incredibly elastic, right? They can go up and down instantaneously and all of the hard part is just handled through, you know, the fund infrastructure itself. >> Yeah. Very, very cool. I mean because this this ultimately can apply to stable coins. It can apply to money market funds as they come on chain. There's all sorts of different functionalities here and different vectors in which uh institutions at large are going to view

this and ultimately leverage the technology. And so I'm curious as more of these assets come on chain, you know, sort of referencing the original thesis that, you know, we we shared at the beginning of this segment, which is that there's kind of this onslaught, this wave of tokenized assets that are entering that can be tokenized deposits or equities or money markets or treasuries. All of these things end up on chain. What happens to DeFi protocols? Like do you think that, you know, it's just it's just a pure rerate? these TAMs are an order of magnitude higher, activity is higher, fees are higher, earnings are higher, token prices are higher, or is it like we're going to have to adapt our monetization strategies to compensate for the

increase of assets on chain because someone else is going to come in and provide the same services for a more competitive rate. How do you think this will evolve? >> Yeah, it's actually a great question. Um and it's one of the initial you know shower thoughts and you know thought experiments that I had that led me to start superstate right like I was a DeFi founder you know I worked at compound I worked at compound labs like you know I was there for a number of years and you know at a certain point it was like 2022 it's post FTX blow up you know the market had just gone sideways and like when I looked at the market as a DeFi founder I said the ceiling is too Right.

The only assets that are currently usable in borrow lend protocols in AMMs in any of the things that people are building and most people were not building that much because it was the worst of the bare market in a lot of ways. The ceiling is too low. All we have are these cryptonative assets yet the addressable list of assets that we could use in DeFi protocols is like 10,000x as large, right? And so for me as a DeFi founder, I said like why does there need to be incremental work on DeFi when we're like still like chipping away at this extremely small like tip of the iceberg like really really really small right and like it was too small to even

worry about in some case and so the the mission that I have at Superstake is to like indirectly grow that total addressable market of DeFi by 10,000x right it's like there literally can be not just just a rerating of DeFi protocols. That's like down the road, but like a rerating of like what are the assets out there and like can they talk to smart contracts and blockchains in the first place >> and you know we're trying to break down that wall and make all of these traditional assets able to communicate with a smart contract. When every asset can communicate with a smart contract, the total addressable market is massive.

That like leads to more, you know, smart contract growth. that leads to like the application layer, at least the L1 layer. [snorts] You know, I'm just focused on like the biggest possible inflection point, which is like how do we just get trillions of dollars of stuff able to talk to smart contracts so that we can program it so it can go into DeFi protocols and just like chipping away at it one piece at a time. And it's going to scale really quickly once it does start to scale, right? Like >> we're still in the proof of concept phase. We're over a billion, but it's still like proof of concept, right? like >> things that work can apply not just to like a piece of traditional finance but to the whole thing. Like to my earlier point, it's not like oh the internet like took 10% of like the banking

business. No, 100% of banking is like internet based out, right? >> Like no one is like using the phone anymore. And so I think eventually close to 100% of finance switches to tokenization under the hood. It might not be like in everyone's wallet directly clicking buttons and all of that, but like we're headed towards 100% market share. >> I Robert, this is going to sound weird, but I think we're headed even higher than that. I think >> 100% market share. >> I think I think there's non-skeumorphic elements of of asset classes that are out there that don't currently really fit into the current financial system because we haven't had technology that have made them liquid or made them compatible or exchangeable with the rest of finance. So they've been kind of

siloed and we don't really think of them as finance. But with tokenization and with DeFi and with blockchains, I think they all we you know we end up increasing the the size of the pie and you know the TAM we can think of all the assets that are out there now. But there's also even more assets that are available to us even outside of this thing that we currently think of as finance. >> Great. I was a wimp by saying 100% market share. I am now going to start saying 500% market share. [snorts] >> 500% is fun. Robert, um man, Robert, you're the man. uh really appreciate it. Would love to have you. Would love to have you back. And uh I know you're busy out there bringing uh uh finance and beyond on chain. So we we'll let you get back to it. But thank you so much for

spending some time today. >> Thanks for having me on. >> We'll see you again soon. Thanks, Robert. Guy's a legend. Absolute legend. Pleasure to have Robert on for the first time. I mean, where else but the rollup do you get the head of consumer from Salana and then you follow that up with the founder of Superstate. Uh uh and we we you know are just all across the tokenization super cycle. Uh from the most one you know the the the most extreme side of the barbell all the way to the other side of the barbell. you know, the legitimization of the industry, the tokenization of, you know, money markets and securities and and and treasury funds all the way to the other side where, you know, you you get attention markets, tokenized fossils and, you know, playing a uh uh uh

environmental trade. Just abs absolute rockstar lineup here on the show. Appreciate you guys rocking with us in the chat as well. We're not done. We are not done yet, Freedom Guy. We are not done yet. Andy's in the chat. Freedom guys in the chat. Greg's in the chat. Appreciate you guys rocking with us. Keep the chats coming. And we're going to get into our next guest. Ethan is going to join us. Uh Ethan is one of the uh where let's pull the stabled up segment down and let's get Ethan going because uh Ethan's a true OG in himself as well. Uh Ethan is an original uh you know when when we come up with like these really you know deep innovations they almost feel like inventions. So I

feel compelled to call Ethan uh and the inventor of Cosmos. Uh and we're going to get him uh talking about ownership and speculation, how the thesis has evolved in recent times. Uh how Cosmos has evolved, what he's working on most recently. uh because we've had both sides of the barbell up today and uh we're going to get Ethan's perspective coming up in just a moment. Hope you guys are having fun out there. I got my co-host saying that Pump Fund is pumping as it should be. Uh all kinds of things happening out there in the market. Uh Ethan's been patiently waiting behind the scenes. We're going to bring him up getting him ready behind

the scenes. absolute rockstar segment with uh Robert Leshner uh and head of consumer from Solana. And our last but certainly not least guest is coming up next uh Ethan, co-founder of Cosmos and Tenderint. Uh like I said, when I when you know we get these real innovations, I feel compelled to call them inventions. So I feel like Ethan is his real his real title here should be inventor of Cosmos and Tenderment. Um, and uh, now he's CEO of Cycles. Uh, let's go ahead. I think he's ready there in the back. Let's go ahead bring him up and uh, we'll get another word from a true legend of the game, Ethan. Welcome to the show, man.

>> Hey, it's great to be here. Thanks for having me. >> Absolutely. Uh, well, I mean, a lot has changed. You know, we've gone through uh, tons of gyrations and uh, just this episode so far, we've got uh, a true barbell going. One hand, we had head of consumer from Salana. He was talking about tokenizing, you know, meme coins and fossils and, you know, all all kinds of wacky things. And we had Robert Leshner, DeFi legend and, uh, you know, uh, head of superstate tokenizing treasuries and, you know, these more buttoned up things, but still dealing with a lot of complexity on that side of things as well. Where where are you at on this barbell these days? Are you more more on the consumer side, tokenizing all kinds of wacky things, more on the

uh, you know, the the buttoned up side? Are you still deep in the infrastructure world kind of helping both of these things? >> I want to have direct ownership of the fossils and underlying items. I'm not trying to tokenize. I want I want the real deal. I've got, you know, I got a Alexander the Great coin right here, you know. Uh I don't want that tokenized. I want to hold the thing in my hand. This one's in a case, but you know, some of the other silver coins I got, I can actually Okay. >> Can actually feel them, you know. But I actually gave a talk a couple weeks ago called tokenization is not the answer. So I'm not on that spectrum. I'm uh I'm doing something else here. So, I think tokenization is important, but I think we're just so carried away with the

asset side of the balance sheet, and I'm trying to focus on on opportunities in the graph of liabilities. So, >> that's interesting. So, what is the anti-tokenization thesis? >> It's not so much anti-tokenization per se as it is uh about going doing more than just tokenization. I mean, tokenization is is is a starting point, but again, it's it's really just focused on the asset side of the balance sheet. And it's important. It makes things cheaper and and more accessible and it can move 24/7. And, you know, I'm I'm pro all I'm not anti- any of that, right? Okay.

>> Um, but it's not the solution to all our problems. It's not like we just tokenize everything and then, you know, we can pack up and go home because we won't really have accomplished that much. Like, yeah, we made we've made everything like cheaper and faster and and slightly better, but it's just like it's just more of the same, right? Um, what I'm focused on is something more fundamental, which is like what is all of this for? What are what are these assets for? Right? And ultimately, if you think about what money is for, it's for discharging debt. It's it's fundamentally about denominating and discharging debts, right? Every transaction you entered into is a debt before it's paid, right? Even even at a cash register, right? You take the items before you give them the money. I mean, the debt exists, right? And most of most

of the world's trade operates on invoices and trade credit and you know you trade between uh you crypto dealers and prime brokers and market makers. They settle you know once a day this kind of thing. So everyone everyone is trading on credit and so you have this massive web in the world of liabilities right that that are out there that determine how much cash how much inventory how much capital is needed to settle them. And one approach is say well why don't we just tokenize that and then you know it could be sold off and people can buy it and it'll go wherever you know the risk wants to go. And you know that's what we did prior to 2008 and all that blew up. Um but there's a different approach right which is which is to say well well no forget about the assets let's actually look at the

structure of liabilities that exist in the world the graph structure the network structure and let's see how we can take advantage of the structure to actually reduce how much capital reduce how much tokens reduce how much assets we need to clear all that because anywhere there's balance in that network the debts can be netted out without any cash or capital having to move right so this is done every day at clearing houses. All the big banks has have access to uh you know large clearing houses that net out trillions in volume, you know, on an almost daily basis. But the rest of us don't have access to that kind of facility, right? So clearing netting the ability to net out debts without moving money is really this this financial superpower. And tokenization is, you know, it's it's just the same

old story, right? Whereas actually bringing netting to everyone uh is is a much more arguably transformative endeavor because it can really reduce how much cash everyone needs to do the same amount of business or ultimately even more. Right. So it's a it's a larger kind of growth and and sustainability story at play. >> Yeah. Um I've seen this before and obviously this concept of netting is you know ages ages old. Um, but you know, doing it in a modern world, especially with a tokenized economy, like that is an entirely new ball game. I remember there's there's been protocols like Everclear where they were trying to do this clearing house concept. I think they might have wound down or, you know, didn't quite find the traction that they were looking for.

>> Y >> what is cycles doing and how are you positioning it so that it succeeds whereas others who have attempted what you're describing because I think we all agree this is a massive addressable market. What is it what is unique about cycles where it will succeed whereas others failed? >> Yeah. So it's you're right it's a very hard problem and we have seen others others start and everclair was you know great example they built some amazing infrastructure. They were focused on one specific niche. What's different about cycles is we actually we've started from first principles right if you read our white paper we lay out like real fundamentals going back to just basic balance sheets and graph theory. This is stuff I expect to be in textbooks down the road. Now that's not a reason why we're going to succeed. But if you just

ask what's different, we're not just building product. There's there's fundamental conceptual apparatus we've developed which should be the foundation for developing settlement systems and and economics in general. I mean, Frank, this is another conversation, but I think you know the 20th century of economics can basically be written off. Nothing really important or interesting happened there. We kind of need to redo it all. Uh and we need to do it starting from uh starting from the network of balance sheets as the as the basic primitive that we're reasoning from, right? And and that's what cycles does. It starts reasoning from the network of balance sheets from from first principles. And so we have a a generalized conceptual design that allows us to build capital efficiency and clearing into the heart of every financial operation, right? That's a much more generalized thing than any other clearing solution or project or

product that's you know building one particular solution, right? So we start with that generalized apparatus. But then there's obviously the qu I mean we're not just a science project. We're trying to bring this thing to market, right? So uh we have we have two go to markets running in parallel where where we're starting. But our goal was to bring this general purpose clearing technology to everyone. We want to make it generally available systemic infrastructure that that's part of all finance and and commerce um across the board. Right? So that's that's where we're going longterm. In the short term, one place where we're starting which which is uh you know maybe particularly relevant is among crypto market makers, OTC desk liquidity providers where you know they they deal with each other on a daily basis. they're settling, you know, T+1, they'll settle a large volume of of

um of assets and uh and there's no clearing facility, right? So, they're all using more capital than is actually necessary for them and that affects the entire market structure, right? That reduces capital efficiency pretty much uh across the board. And so, you know, there are some efforts to build clearing houses for them. Of course, there are existing clearing houses in Tradfi and they could consider joining those and, you know, having their obligations become uh part of those clearing systems. But what we're building with cycles is unique because it doesn't require a central counterparty. It's not based on traditional kind of clearing house design which arguably is overkill um in a lot of in a lot of situations and which is doing a lot more than just clearing. Most clearing houses are actually underwriting counterparty risk which is a a whole other can of worms.

So uh cycle is a very unique kind of simplified and generalized design that can work in kind of any market where there's obligations. And so we're starting in that sort of crypto dealer market, but long-term we're hoping to move into the trade credit market, which is okay, you know, the largest source of financing for firms, uh, for non-financial firms on the planet. They're financed by their suppliers, right? I ship you goods, you owe me in 30 days, right? I'm basically lending you the money to pay me is is is one way to think about it. Um, and, uh, and there's no clearing facility there, right? Again, everyone is using more cash than they actually need. So, uh, big ambitious kind of long-term play here. And so because the suppliers have these liabilities on their books, um they have account receivables, but the

the the importers, they have liabilities on their books. You're saying that there's this network of importers and exporters throughout the world where they all have their liabilities on the books and there's maybe they maybe don't even know each other or know that they owe each other money, but if they were connected to the system, you can sort of zero out that debt and and everyone is sort of reducing the amount of capital that they might need to take on. The interest that they pay on that capital, if they pay interest, can all be reduced as well. And then you can ultimately make this thing much more capital efficient as a result of lowering the outstanding liabilities.

I I mean I I think it's really cool. I also I like the the graph and network theory behind this as well. And so maybe you could just talk through the the the the generalizable nature of this as well because I think people understand this. Maybe you know the the the most common example is look we all go out to dinner. There's four or five of us right? we all you know you know are going to owe each other someone pays and then everyone else you know is going to pay that one person but you know exactly split-wise right is the best concept you know the best example of this another example actually if you don't mind walking through like in you know this this hypothetical example is like we've been hearing a lot about the DTCC right the depository trust and clearing corporation right they're bringing a lot

of their tok uh their their assets and their equities onchain For anyone who doesn't know, these these guys actually custody like 90% of the stock market and then they allow the brokers to hold those shares at their trust in their custody and then allow their customers of the brokerage to trade them and then they just maneuver, you know, the balances on on the back end. How might a a corporation as large and as systemically important as the DTCC utilize something like cycles to ultimately make their netting and their clearing more efficient?

>> This is a really interesting topic. Uh so there are many clearing houses out in the world and the DTCC actually runs multiple of them. Um and each clearing house is typically focused on a certain set of instruments, right? So there's an equities clearing house, there's fixed income clearing houses, there's derivatives clearing houses for different derivatives instruments and so on. So there's there's many clearing houses out there. Each one function typically functions as what's called a central counterparty, which means the main thing they're doing actually isn't netting. The main thing they're doing is underwriting the counterparty risk of all the participants, right? And so the core idea is that you know if we do a trade with each other both of us are anxious to uh offload our counterparty risk and to be facing someone that we

deem more trustworthy than each other right and so a clearing house a typical central counterparty clearing house kind of intermediates that right and becomes the buyer to all sellers the sellers to all buyers that's that's noation right that's the main thing it's doing is actually underwriting that counterparty risk clearing comes as this like secondary benefit on top of that it's just like obvious if you're all facing one party you might as well net out all the positions right [snorts] um but Of course, being able to underwrite all the parties is a very high overhead regulatory intensive thing. It it limits the uh the number of participants that that can join. It basically makes all participants like a single class, right? So membership at clearing houses is is pretty limited. It's in the like 50s to hundreds kind of thing, right? I think the largest clearing house is in India

and it's got like a thousand members, right? That's where it caps at, right? We're talking about millions of businesses, billions of people. I mean, no chance you can build a clearing. No one's going to underwrite all that counterparty risk. I mean, that's that's insane, right? And that's that's not what we're trying to do. But even if we just look at clearing houses themselves, there's many of them. And the membership overlaps, right? The major financial players, they're members of many of these clearing houses, right? And they end up having to split their liquidity and their collateral across them. But there's an opportunity for cyclic flows between the different clearing houses and their members, right? So one bank is owed by one clearing house and owes another, right? And that clearing house owes another bank that owes the first clearing house. you get these triangle these diamond shapes and beyond in the

network of clearing houses and financial institutions right so anywhere where you have those kinds of uh offsetting obligations in this network structure there's opportunity to do clearing without a clearing house that kind of rules them all right and you're never going to have if there was only one clearing house in the whole world then then from one level the clearing houses wouldn't need something like cycles because there's only one of them and everyone's a member of the one and it clears everything now that's never going to happen there's dozens or you know maybe there's a hundred of them or something there there might even be more and and so now we have this thing you know the US is forcing all treasury trades to basically clear centrally which wasn't something that that typically had been done like repo and you know fixed income trading I mean

there is the fixed income clearing corporation under the DTCC which does clear you know significant amount of uh of of uh treasury securities but but not all of them there's a there's a huge outstanding fraction that doesn't clear centrally and now they're forcing it to clear centrally and the the regulators thought well it was all just going to clear through the FIC but the market said no hell no uh you know we demand that we multiple options for central clearing for these instruments, right? So, we're going to have uh you know, ICE is is is going to be clearing, we're going to have the CME clearing, we've got the FIC. So, there's multiple clearing houses that are going to clear the same instrument, right? And now the Fed is worried about well, you know, what's that going to do to fragment liquidity across the the clearing

system, right? So, something like cycles allows you to clear across the clearing houses, right? Which is uh potentially very powerful. But like I said, you asked earlier, >> explain this generality. I mean, so it's one in one sense, yes, it's like a split-wise for everyone, right? Unlike split w the way splitwise works it's also doing innovation. Splitwise only works when all the members know each other and trust each other right uh cycles works in a sort of generalized setting among strangers where I don't have to know all the other members in the network or trust them or be exposed to them. Cycles isn't going to cause me to owe someone that I've never met before, right? Unless I explicitly opt into that. What cycles allows you to do there's there's the obligation piece. So I owe Bob, Bob owes Alice, Alice owes you know Trevor. Trevor owes me. There

there's a closed loop. But cycles also allows you to express what we call acceptances which are willing which is a willingness to enter into debt into the future. And an acceptance we call it an acceptance well because in one sense it's what happens when you accept money into the bank, right? You're willing to have the bank owe you. That's what it means to have money in the bank, right? So if I owe you and you owe Bob and Bob is willing to be owed by the bank and I have money in the bank, then my money can ultimately flow to Bob, right? And so these acceptances allow you to close more loops uh by by virtue of them becoming obligations in the future. So they're they're this sort of generative function, right? It's not just about obligations that exist in the past, but potential obligations in the future. And

and that's it. That's all you need for all of finance. Obligations in the past, obligations in the future, right? That's kind of the the way we we can boil it all down. And so if you represent all of them as directed edges in a common graph, then you can do this incredible amount of clearing and capital official settlement in a in a multilateral graph that unlocks all kinds of new possibilities that that weren't really feasible before. >> You're going to make me open my combinatorics textbook from a few years ago. Man, >> just open our white paper. [laughter] >> Um it it is really really cool. I And uh it it sounds like you're inverting this concept of a clearing house, right?

Because if you were just to continue this in the direction of what clearing houses traditionally are, you would end up at, you know, the logical conclusion of one clearing house to clear them all, this one world order, right? And then you wouldn't, you know, need this. But what you're saying is that everyone can kind of be their own clearing house, right? If the bank is you know holding assets and clearing through multiple clearing houses well then the bank itself can be a clearing house for you know what is happening where where it's uh uh clearing the rest of these assets. It also reminds me of the old adage of you know this industry be your own bank but we didn't really stop there. It's like you can like you can be my bank, I can be your bank, right? Based on this

example of, you know, if if you're willing to get this acceptance, then this money can be used for this purpose, right? And and you can sort of circumvent these typical pools of capital that kind of sit there because, you know, they've got like this entrenched nature to them like a bank and people like have this like inherent trust and legitimacy to them, but they don't really provide a ton of value. And so that is sort of what it feels like you're you're disrupting. You're you're innovating those kinds of intermediaries away. Is that sort of the target target market here?

>> I think so. I mean that I I was always frustrated by that adage be your own bank because it was so focused on, you know, just the asset side of the bank's balance sheet. Most of what the bank is doing is on the liability side, right? It's it's the deposit side and and it's it's the accounts it holds for other banks and its ability to net out liabilities, right? So sure, let's let's be our own bank. I mean, I don't I don't expect banking is going to go away or banks as institutions are are going to go away. It's really about bring that power of the full power of banking to everyone, right? And clearing, you know, I I got really I spent 10 years building Cosmos, right? So I got really frustrated with the industry, how we think about money. Um, you know, it's

sort of like everyone's an Austrian economist and and that's just a dead end. I mean, that is not this the answer to monetary theory. I mean, there's some good starts there. Uh, but it but it's but you know, its development got arrested. It became kind of neo-reactionary, whatever, right? So, I got really frustrated with how everyone's thinking about money. I was like, I'm going to go back and actually study this stuff for real. Find out what happened historically, where banks came from, what they did, how it all worked before central banking and all that. And it's amazing what you discover because the banking system was incredibly advanced prior to the rise of central banking, right? So, from the, I don't know, 12th to 16th century, we had a rich international banking system. And the main thing they did was they worked to balance trade. across the different

regions in Europe so that they could net it all out. They'd gather at these fairs in person and they would run a decentralized clearing algorithm where they'd like find all the closed loops that allowed them to net out their books so that they could, you know, settle all this trade without any money without actually having to carry, you know, large amounts of coins or or bullion, right? And so I sort of came away from that realizing, oh my god, like clearing is this financial superpower, but nobody has access to it. It's just the largest financial institutions in the world through their clearing houses and it's like small groups of friends using splitwise as like a gimmick to, you know, simplify their expenses on a on a trip or at a restaurant or whatever, right? And everyone else is in is systematically cut off from the most

powerful financial primitive in existence and nobody in crypto is somehow. We think we're developing a monetary revolution and we're just stuck at tokenizing assets. I mean, come on. Like people, come on, right? Like so I so I was like all right I guess I'm going to dedicate the rest of my life to this thing because everyone should be you know settling more with less. I mean uh that's what it's all about doing more with less right. So let's bring that to finance. Let's not just do more with more. Let's do more with less. >> And and and how do you and how how do you avoid this thing that has been brought up and it's got a funny name but that's the reality of it. this this research fetish. Like obviously there's deep deep you know technical complexity that you've been able to achieve with

you know uh creating a better graph of how these liabilities are constructed in this network. But you know the there's a real gotomarket strategy that's going to be very important with bringing something like this to market because the clearing house space is so dominated by regulatory overhead and incumbents. How do you anticipate using this technology and ultimately penetrating this market >> on not just being a research shop, not just building a generalized platform and actually really focusing on the products and and and the go to market, right? Um and so we're we're talking to, you know, most of the large market makers and dealers and and primes in in the space.

It's challenging because it's a network effect problem and they all know it. We have to like build a consortium and get a consortium of them on board at the same time. But we've built the product for them. You know, we're iterating on it with them, get getting feedback and and and starting to onboard. And that's really our main focus uh on on that go to market. We also have this other a secondary go to market. We have an app in the app store, Cycles Pay. You can download it today. If you're a business in crypto and you want to pay and get paid in stables and you want privacy and self-custody, >> there's basically no solutions, right? Either you're, you know, you're on chain with self- custody and everything's fully transparent and everyone can see everything you've ever done, right? or you're using some Neo bankank or

something and you don't have full self-custody, you're not fully on chain, right? But so we've built an end-to-end uh privacy preserving with zero knowledge proof solution um for businesses to pay and get paid their invoices that's live now. We've been using it to process our own invoices for the last the last few months. We have, you know, some of our vendors uh invoicing us and and and so on through it, but now we're we're we'll be launching on Arc when Arc is live um in uh in September. So we're we're very excited about that. But you can use the app today. It's live today, fully private. Um, and and we're going to be moving into the the credit world. So, invoice factoring and discounting and really focusing on, you know, bringing stable coin commerce uh to that to that world and and unlocking a graph in that

way. Opening up, you know, bringing invoices kind of onchain, not so we can tokenize and trade them, but so that we can settle them with less um with less uh uh assets, right? So, those are our two go to markets that we're pursuing. And you know there's some research obviously involved in that but you know we don't have like a big team of researchers that are spending all their time um you know running in circles there as much as I would love to. I mean I think all of monetary economics needs to be like reformulated from a graph-based uh you know setting. So it's graph theory of money is is sort of what I'll be working on the rest of my life. But we're very much you know we raise money. We're very much trying to bring these things to market and and focus there. And on the side I study the

history of money and medieval banking and you know I'm happy to talk for hours about you know the history of coinage and and all this kind of stuff. But yeah >> I love it man. I love it. Graph theory of money and the history of coinage. That's that's the fun stuff. All right. So, let's let's close the loop. Um because we you know started off you started off talking about ownership and you know and and these sorts of things. Can you just you know make it excruciatingly simple like how netting and ultimately you know decreasing the world of liabilities ultimately takes us from a world of derivatives to a world of ownership. Can you help connect those dots and close that loop?

>> Yeah. So I don't think own I don't think derivatives are going away and I think there's obviously I mean it'd be crazy to come out here and say that and and I don't think they're bad per se, right? I mean, I I sort of tweeted I sort of, you know, it just occurred to me. It was kind of ironic that in an industry that was so based on ownership and self-custody and self- sovereignty, the number one, you know, projects now are are just derivatives and prediction markets, right? And so, and where there's no ownership of the underlying, nobody cares about the underlying, you're just speculating on the outcomes of oracles, right? Literally, both per and and prediction markets. So, that's that just sort of struck me as as ironic and and interesting. And and I mean finance is like that you know it goes in

these these oscillations where at times you know the underlying matters and then everyone gets like excited and and you know the frenzy happens and uh and so you know the derivatives the derivatives take off and and there'll be that oscillation but if we're actually talking about you know a meaningful upgrade to the structure of the financial system just tokenizing everything and just financializing everything like like that doesn't get us there. But yes, it's marginally better to have assets trade 24/7. And yes, it's meaningful from a human rights and accessibility perspective to have markets open longer so that people can can access them. They they can make trades when they need to. You know, a lot of people are busy during business hours, right? And so, you know, how much does that inhibit them from actively like investing their capital long term?

I'm not sure. Day-to-day trading, sure. I mean, but but that's not really what what we're trying to enable, right? So all this tokenization stuff like yeah it has these marginal benefits but it doesn't meaningfully address the systemic liquidity pressure that applies to hundreds of millions of businesses around the world which you know one of the number one reasons that businesses go insolvent is because of liquidity stress. They they they have you know duration mismatch. They can't collect on their receivables quick enough to pay their their payables their liabilities and so they're pushed out or you know they have to take out expensive loans or you know working capital and and and so on. And so, you know, this is widely recognized, liquidity is widely recognized as a a critical issue, but the main tool the Fed uses or that regulators use is is central counterparty clearing houses and just

printing more reserves, right? And and there's a whole other approach which is actually look at the graph structure of the network. It's much more difficult. You need a lot more data is a much harder network effect. But I mean guys, it's the 21st century like we can land rockets. We could I mean maybe landing rockets is easier than this but you know this is multistakeholder coordination coordination issue right so so it's really about and you you you get it every time you use splitwise right if you didn't use splitwise it would be a huge pain in the butt right so imagine that pain just like multiplied by literally you know 200 million across the world and much hard larger volumes I mean you know your trip costs $1,000 total people are invoicing tens of thousands hundred thousand millions millions of dollars right and so all

that capital that just has to get tied up in settlements and it's not because the assets can't move fast enough, right? It's because of the network structure of liabilities. It's gridlock, right? I mean, it's like you sit in tra I don't know where you are. I'm I'm in Toronto. Some of the worst gridlock in the world. I can't go cuz they can't go cuz they can't go cuz they can't go, right? Cuz I can't go, right? It's the same thing in the payment system. I can't pay you cuz, you know, cuz I haven't been paid because he hasn't been paid because he hasn't been paid by you, right? And so, so clearing kind of unlocks that, right? Um and that's uh that's incredibly powerful and but we've never seen it at scale. Now, it does run I'm just kind of rambling here, but just just to give you there is precedent for

this. Um, >> in Slovenia, I mean, I don't know if anyone's paying attention to Slovenia. They're actually pretty hot on uh on crypto, pretty advanced in Europe for crypto adoption, but they've been running a system at the national scale for like 30 years now, which was a huge inspiration for cycles that clears the country's trade credit. So, every business in the country can submit their B2B invoices to the government. the government runs this algorithm to find all the closed loops and and clears you know percentages of the country's GDP every month right um and and this allows them to free up a huge amount of of capital right and of course usage usage spikes in times of credit stress and and and so on right and so this is just like pressure off everyone's balance sheet it means they can do more with less right

and and what is the point of civilization if not doing more with less >> yeah well said amen >> Ethan you're the man bringing bringing the life to this episode today. I I I love it. I love it. Uh I want to bring you back. We do a full graph theory of money episode. We do a and then we bring you back again. We do a full go back in time history of coinage episode. >> You're the man. >> That'd be great. Thanks so much for having me and letting >> Absolutely. Thanks. Thanks so much for coming. Appreciate your uh contributions to the ecosystem at large and uh yeah, love to have you on again soon.

>> It would be great. >> Cool, man. Well, cycles to the moon and uh we'll see you again soon. Thanks, man. >> Cheers. Cheers. All right, guys. We're gonna we're gonna keep the show moving along. Uh Ethan was our final guest, but uh we've got some news that we're going to cover and uh so we're going to get into it. And uh I mean rockstar lineup today. Ethan ended us off with a bang, but I mean guys, Robert Leshner, Ethan, inventor of Cosmos, head of consumer, Pedro over at Salana Foundation, and we couldn't do it without you guys.

All you guys in the chat, dubious rational, financial privacy is critical for the fully functional civilization. Yeah, go give uh Cycles a download. They said they're in the app store. Little Miss Gun talked to a couple of hedge fund guys, but sometimes I think I know more than they do. Wouldn't be surprised. Little Miss Gun, you're watching the rollup. Of course you know more than they do. Freedom guys here. Sound effects are on. Manu Coacher, new name in the chat. Good to see you. Freedom guy. Banking isn't the problem if done properly. There you go. That's that's the key word there. If done properly. Rand Corp, good to see you here as well. Hope you guys are enjoying the show for today. I certainly am.

Absolute pleasure. Dubious rationale. Whatever happened to Zcash? I don't know. Let's do a little check in on the market. Co-host said that pump fund was flying. We're refreshing. >> Zcash looks fine to me. 778. Hyperlid chilling 81. Oh my goodness. Pump fun flying. I'm underexposed to pump fun. We're going to have to get those numbers up. Z Hyper Pump. If you guys uh if you guys don't know, now you know. Zcash, Bitcoin ETH gold on the uh on the monetary hard asset side of the portfolio and uh

Hyperlid, Pump Fun, Aerod Drrome, Lighter VVV couple others, Sky actually had uh actually had my uh my quant do a little bit of uh deep dive, put my put my model on uh the absolute highest intelligence. Had it think for about 20 minutes on uh some portfolio allocation constructions. Let me tell you what it came up with. You guys know the thesis well. You know that the barbell, the horseshoe theory says that hard assets and scarce uh hard money and scarce assets on one side and then on the other side we have the revenue meta group and

I had it run an analysis on some tokens that I'm considering. Pump Fund came back as the most attractive from a token uh market cap to earnings perspective only 6.7x market cap to 30-day annualized revenue. Uh it is the clear valuation winner. Pump is substantially cheaper than anything else in the group. to give you guys some some names here. Uh, Pump Fun, Aerodrome Lighter Hyperlid Sky Maple, Near, Akos, all part of this group. Chain Link you could also put in there. Uh, there's some other uh Ether Fi you could probably also put in there, but this is the group that I had my Clanker run on. Pump Fund substantially

cheaper than anything else in the group. uh annualizing 30-day revenue gives you about 277 million of token buy and burn against almost a $2 billion circulating value. 6.7x PE or a 15% current buyback yield. Even using fully diluted instead of circulating market cap gives you only about 14.4x. This isn't merely a favorable one-month denominator. Pump's own 90-day dashboard currently shows roughly $391 million of annualized protocol revenue at a 50% allocation of buybacks. That would simply that would imply roughly $200 million year per year of capital return. So the broad conclusion that pump is inexpensive survives.

The question is therefore not whether pump is cheap on current earnings. It unquestionably is. The question is what multiple a meme token creation trading business deserves. And so when we talk about multiples, we're talking about durability of this activity. And you heard the head of consumer from Salana come in and say that this is not a cyclical uh business segment. These are revenues that will persist. Obviously, this guy's incentivized to say that. But uh if you believe what he's saying and you believe that memecoin trading launchpod launchpad volumes are not cyclical then you would expect that this multiple to expand not contract and the multiples are already low. So pump fund

definitely seems undervalued here. Uh conclusion is that pump passes the revenue acral test extremely strong on valuation alone. It is number one. Hyperlid then comes in as the quality winner. Hyperlquid is almost the opposite proposition. Not the cheapest, but probably the cleanest, highest quality capital return mechanism in the group. Standardized 30-day PE is about 33.7x. So that's five times the multiple of Pump Fund, but the market says that Hyperliquid's revenue is a lot more durable and predictable. And so therefore the earnings and buyback yield is much smaller at around third 3% not

5% or excuse me 15% like pump fund but it is priced as a lot more durable uh per volume just seems like a more sustainable asset class. Um at least the market is pricing it as such. Uh the most recent week has been considerably stronger. 21 million of holder revenue in seven days annualizes to about 1 billion which would put today's circulating valuation at only 15.8x 8x that run rate. I would not capitalize one hot week indefinitely, but it demonstrates meaningful operating leverage and I think we can point to this most recent week of data as uh evidence that volatility is returning and uh this is leading to more revenue and more value acrruel for the

hyperlquid token. Uh this model goes on to say that sky is probably the most interesting discovery from the exercise. Sky looks expensive if you mechanically use the trailing day 30 days. Uh only $2 million of holder value times 12 produces about 21 million uh of annual capital return implying almost a 75x price to earnings. Yet the underlying Sky business generated almost 14 million of protocol revenue in those same 30 days. Its market cap is therefore only about 10x annualized protocol protocol revenue. And unlike the hyperlquid lighter pump, Skye's $1.6 billion market cap is almost identical

to its FDV. Uh that creates the question, why is such a profitable business returning so little of its economics to Sky, right? Uh and this is where the very recent governance change matters. There's actually been a governance proposal on Sky on August 17th, just last week, uh that Sky executed, a proposal to increase the buyback frequency directing each smart burn engine cycle 55% towards Sky purchases and 45% towards staker distributions. Consequently, the 30-day number largely reflects an obsolete capital allocation policy. We actually got a new monetary uh policy in Sky that

differs uh over the last couple of months and therefore distorts the annualized uh holder revenue, the capital, uh earning that is coming into the Sky Protocol. And so, uh over just the last seven days, DeFi Llama reports $99,000 of holder revenue annualized. That's 47 million which would put Sky at roughly a 34x and that is almost exactly the same earn uh price to earnings as hyperlquid and uh that one week figure is a little bit too young to underwrite as permanent earnings but the setup uh more closely resembles what we can expect going forward and remember that sky

circulating is the uh exact same it's fully diluted so uh circulating is the same as uh fully diluted on Sky. This goes on to say, "Lighter is legitimate, but hype is a difficult comparison. Lighter is currently at a 33.4x price to earnings. Looks virtually identical to hyperlquids. Its capital return structure is real. Uh the protocol says trading fees fund daily lighter bulb buybacks. Um but uh it says a demand it to demand a discount to hype rather than pay the same multiple. Uh, Lighter has roughly 4x as much FDV as circulating market cap. Uh, that's slightly better than hypes. More importantly, the earnings trajectory has

weakened considerably. Lighter's cur quarterly gross protocol revenue went from almost 40 million in quarter 4 2025 to 20 million in quarter 2026. But I would imagine uh that again and we we can actually see this in the data recent activity has improved uh and so very similar to what we described in the per market. The earnings trajectory uh has improved um in most recent activity to seven days of holder value annualized to roughly 44 million implying a 19.5x market cap PE at that pace. That's what we're seeing.

So that's a little bit on lighter, a little bit on hyperlquid. Um, and there's a couple of other interesting ones. Mir's got an emerging revenue thesis, not yet an earnings asset. Uh, Aerodrome has a 10x price to earnings, which feels relatively cheap, but a very different mechanism. Maple and syrup look expensive today. Inexpensive business underneath. And Akos uh, doesn't quite fit the revenue token thesis. So guys, I mean the clear takeaway here is that pump fun is pretty cheap when you're looking at it based on this metric. Um, and the other takeaway here is that lighter and hyperlquid are

uh basically I mean they turned their business around if you look at the last week significantly more volatility. Um, so that's what we're seeing. Uh, guys, there's really just one or two things that we've got left to cover. Uh we're going to do a hyperlquid policy center tweet and then uh we're going to get into daily equity. We're going to get out of here by the top of the hour. So let's go ahead hit the next headline and we'll we'll uh we'll we'll wrap up here. Uh oil prices move 24/7 that the markets that American businesses use to hedge them do not. Today, Hyperliquid and Trade XYZ filed a joint comment letter asking the CFTC to open a regulated path for energy perpetual

contracts. This is what we're seeing. I mean, this is directly on the heels of the CFTC innovation advisory committee. Um, and we are seeing direct outcomes as a result of this during February's oil shock. Um, roughly twothirds of uh the weekend price move had already occurred on chain before US futures reopened. Uh, and this is what we anticipate is going to increasingly happen in frequency. Okay, we're going to increasingly see that price discovery is happening on chain. We know that some of these exchanges are just now rolling out um just now rolling out 24/7 trading. Okay, but this is something that we're going

to see uh onchain businesses have already beat this to the punch. They're already moving into this market. They're already live and we anticipate that this is where price discovery is set to take place. And this is going to fundamentally shift the dynamics of the biggest uh financial asset classes in the world. All right. And uh we're going to talk to you a little bit more about this. Let's go ahead flip over to our daily equity segment to wrap up today's show. Daily Equity powered by Dunari. They are

entering the US market with the entire S&P tokenized and uh I mean you guys heard from uh really everyone in today's show uh has a thesis on tokenization whether they're for or against it. Uh this thing is coming online in a big way. Uh ton of things happened in the stock market today. Here's a full recap. We're gonna hit the highlights here. All right, I've got my bullet points here that we're gonna we're going to cover for you guys. And so, let's get into it. Uh, today on daily equity, uh, we have, um, the global physical gold backed ETFs, gold attracted $6.4 billion of inflow. All right. And what that means is that the debasement trade is back in a big big way. All right. And so, we're

seeing this play out in Bitcoin and in gold. And we anticipate that this is going to continue to play out uh in a big way uh very clearly. All right. Uh we also saw Bitcoin ETFs uh up incredibly in volume. Uh we saw into it reported quarter 4 2026 revenue of 4.4 billion. And I believe um that after the market closes today in about an hour and a half, we're going to get Nvidia earnings. Okay. And so this is what the market is watching. Uh we're pretty much all eyes on Nvidia earnings.

Uh and then later in the week, we've got Jackson Hole in which my co-founder Andy is going to be live from Jackson Hole itself. So we're going to get a call in from him. We've got our man Zeus in the chat. Zeus is rocking with us today. Pleasure to see you out here and uh absolutely uh absolutely rockstar show for today. Let's quickly bounce over to our second tweet for daily equity. But again, we're watching we're watching Nvidia earnings and we're watching Jackson Hole later today on daily equity is that stocks are increasingly moving in the opposite direction of the rest of the market. 40-day correlation between

the US broad AI index and the S&P 500 is the lowest on record. Uh actually turning negative and turning negative fast. This also marks a sharp reversal from the positive correlation seen in midmay. Uh and so we anticipate that this is going to continue. Uh AI stocks are cooling, but the market continues and obviously a lot of this is on the heels of the bond market. Uh we're going to see what happens with Nvidia earnings. We anticipate this is going to lead into uh this next phase for the market as we get through we get our next batch of inflation data and we move out of summer uh seasonality and we move into the fall and quarter 4 of this market. Uh again this comes as a result

uh on the heels of the US AI index surging 160% but uh the outperformance of the S&P is now starting to subside and that is the daily equity segment for today. Here's a beautiful chart that shows exactly this correlation. And so the AI versus nonAI correlation is now deeply negative. The nonAI is going to start to decouple in a big way. And we've got an absolutely fantastic show for you guys again tomorrow. Uh we are not slowing down. I mean, if you guys tuned in today, it's pretty much a guarantee that you're going to outperform the market. Make sure you do your own research. But this is what we

do every single day is uh we bring you the best and brightest of our industry. We bring you the head of consumer from Solana's Foundation. We bring you the co-founder of Superstate bringing Tradfi into this world and we bring you uh the inventor of Tenderint and Cosmos. So, legends of the game from all across the spectrum and deep and broad throughout the entire industry. Tomorrow is no different. We're going to go live with Mike Siligay who is the founder of Ether. That is a good idea. A ventures portfolio company of the rollup and the number one leading neo bank and card on the market today. And also Mike Belshi straight from the White House when he

was shaking the president of America his hand straight into the rollup. Guys, you're not going to want to miss it. Stay here. Come in day in and day out. That's how you outperform. We're going to bring you the best of the brightest in the industry and we'll keep doing it day in and day out. Bare market, bull market, doesn't matter. This is where you outperform. Play the house music. We're signing off. My name's Robbie. This has been the roll up. Love you guys. [music]