🟢LIVE From The Nest: DeFi United, M.Stanley Stable, Jane Street 40B, Crossmint, Fluent, CSOP & Plume

Transcript

[music] [music] [music] Heat. Heat. [music] [music] Thank you, [music] son. Lord, [music]

we'll see you around the timeline. [music] Feels good to be back. I think the rollup [music] is one of the most premier media brands in crypto and Andy and Robbie are great experts [music] at everything they talk about and it's my favorite podcast. >> Adding it to my library every [music] day. >> Potentially multi-chain deployments. We are at the connect day one here. You guys see? [music] [music] [music] [music]

>> [music] [music] >> Heat. Heat. [music] [music] >> [music] [music] >> JP Morgan, Black Rockck, DTCC, Fidelity, the entire thing was just institutions.

It's just it's next level. This industry is going to the next level. And guys, I I don't know what else to say. I'm bullish. >> He said it. He finally said it. So bullish. It >> is bullish. I'm bullish. We're bullish. [music] >> [music] [music]

[music] >> Heat. Heat. [music] >> [music] >> Heat. Heat. [music] >> [music] [music]

>> Corola [music] is headed to the top and we're Not already at the top. We're going to the tigers. >> Roll up is my favorite. >> From all walks of life, all over the world, all over this industry come together for the roll up. [music] [music] >> [music] [music] [music]

>> Zoom out. The institutions aren't coming. They're simply here. It's the [music] golden age of crypto, guys. Get right. Let's go. [music] What is the next? See you on the show. We are live. Indeed, we are. Uh I am here coming at you guys from Miami. Happy Friday, lads. Give it up for the Nest. Shout out to the Empire State. Andy's going to join us in just a little bit with a couple of in-person guests. Shout out to Plume. Shout out to the Nest. None of this could not be possible without those guys. And I think uh Teddy, the man, the myth himself is going to join us from Plume, from the

nest. So pretty excited to go uh go live with him. Guys, great show. Tons going on all across the docket. Uh we've got uh obviously uh the Nest coming up in a little bit. We've got markets, we've got weather. AI super cycle is going to be today and we're going to bring you guys Crossman for our AI super cycle episode today. Got the suit on. It's another beautiful day here in Florida. We're feeling good. Markets are holding up steady. We'll get into that in a little bit. Fluent, that is a good idea ventures portfolio company. Good idea ventures is uh the rollup portfolio. Uh we uh we had a brainstorming session at

ETH Denver two years ago where we came up with the name Good Idea Ventures as a way of separating these two brands. So we've been doing all of our angel investments out of Good Idea Ventures. Fluent is part of that portfolio and we're going to be chatting with Dino, the founder of Fluent, as they launch mainet and TGE today. Ticker is Blend, Blend D. Um, and uh, will it blend? It certainly will here at the rollup. So, we're going to have Dino on to chat fluent and then Teddy uh, and uh, Melody are going to be joining us live from the tokenization tower. So, we've got a lovely show for you guys today. Uh, our topics are powered by Treasure, the most

secure hardware wallet in the game. They lock down today's topics just like they lock down your crypto, and we thank them for contributing to today's show. Uh, guys, um, before we get into our uh, markets and weather, let's go ahead and talk to you about Fracks, the genius compliance stable coin. We had an absolutely ridiculous clip from Mike Dudos uh talking about the state of stable coins yesterday talking about Circle as a pseudo CBDC. Uh and then Tether uh how they've completely overcame that regulatory moat, something we've been talking about on the show very frequently. Uh Stabled Up is our flagship show brought to you by Fracks, the genius compatible stable

coin. This is the weather at the tokenization tower. It's a bit warmer down here near Miami, just north. Our weather today is powered by Relay. And uh guys, you'll notice that we've got a new partner down at the bottom, Apex, APYX. They had a hilarious launch video talking about their credit product. Uh it was retweeted by Michael Sailor and it was Margot Robbie in a bathtub drinking champagne talking to you about uh Apex DeFi products. So, uh what's not to like about that? Uh, weather brought to you guys by Relay. Uh, from New York to Miami. Relay will get you wherever you guys need to go. Go to relay.link to go crosschain today.

I recently just moved some things around in some wallets. Uh, just cleaning up some dust. And Relay was the provider on a lot of aggregators. I ended up using relay routes. No surprise there. Cheap and fast. Use Relay for all your crosschain needs. Guys, why don't we get off of weather because there's plenty happening in the markets. Um, I particularly like when we get these days and things are a little bit disjointed. You'll notice [snorts] that uh today we actually have our our altcoins. Anything other than Bitcoin is an altcoin. But today, Salana, Chain, Link, and Near are up, but Bitcoin and ETH are down. Uh, nothing too crazy on these moves. uh mostly just uh just a little bit of here

here and there movement up and down. Uh but you do start to see these things diverging. I think it's interesting that Solana chain like near uh our altcoins if you will are performing better than the major caps, the Bitcoin and the ETH. Um this uh you know it's difficult to draw some conclusions. If you look at the bottom ticker there, you'll see a bit of red. Um and so markets are kind of just leveling out. We haven't really haven't really had any crazy moves as of late. We're going to get into some of our news headlines for today uh because there is plenty for us to cover. Uh Meil Lynch or Morgan Stanley, I believe someone's launching a stable coin fund. We're going to get into that. Also, we've been

talking about how markets are so correlated to macro. everything happening over with the Iran war tends to have an extremely um significant impact on our digital assets uh and the prices of these assets. So uh it's pretty interesting to see how correlated everything is. Obviously we're still rebuilding from the RS ETH exploit. We're going to get into that as well, but that seems to not have as much of an impact as what we're hearing out of Iran. The latest on macro is that uh the US is sending a delegation to Pakistan uh to again attempt negotiations with the Iranians.

I believe we're sending the Wickoffs and we're sending the Kushners. Um I noticed that JD Vance is not joining these negotiations. So people feel like there really isn't much of substance to come from these negotiations. Each weekend we've had a pump going into these negotiations. because these things typically take place on a Sunday. Um, and then the negotiations fall through and then Trump tweets something about extending the ceasefire, extending the blockade. Uh, and then the markets react on Monday morning. Um, I think we're not seeing that weekend pump because JD Vance is not part of the delegation headed to Pakistan to take part in these negotiations. As always, markets are brought to you by Zama. Uh, one of the

assets not listed on digital assets today is Zcash, which is doing particularly well. I like Zcash right now because it seems uncorrelated to the rest of digital assets. When you have Bitcoin, ETH, the rest of the altcoins on this map go up when Iran negotiations are doing well. Zcash doesn't. It is uncorrelated. As the Iran war continues to progress, continues to just uh stay around, we see more and more uncertainty and chaos in the markets. Zcash does well on the heels of uncertainty on chaos. And so if you see negotiations, if things look promising, if it looks like they're going to end the war, buy the majors, not financial advice. If

there is uncertainty and there is chaos and it looks like the war is going to continue, Zcash uh tends to do well. Again that is historical results doesn't indicate uh future outcomes. So just keep that in mind. Zcash seems uncorrelated. Zama is also part of this privacy trade Zcash is part of as well. Zama had a great day few days ago and I think it's holding those levels. One of the best token launches actually as of late. We heard about chip from USDA. Another good token launch. So we're going to keep our eye out for new token launches guys. Blend is the new token launch happening today. Keep your eye out for it. Keep an eye on it. We're going to be talking to Dino, the co-founder of Fluent, about the Blend,

TGE, and the Fluent mainet launch in just a little bit. Before we do, let us tell you about another benefactor of this privacy narrative. It's Near. Near is building private AI. Near is the blockchain for all AI. It's also helping to build some of the agentic future in ironclaw uh which is a secure version of openclaw. Uh and so near is the blockchain that is supporting all of these efforts. Uh we hear rumors that they could also be potentially working with uh governments to help aa aify uh governments at large which I'm extremely excited about uh because I think that is something that we're going to see a lot

more of. [snorts] Our first piece of news, if we can even call it that, um is a shout out to Mr. Gabriel Haynes. Uh this came out uh just a few minutes ago. Uh you you might be thinking, "Hey, Gabriel, like how how did you get in the middle of our show here?" Well, let's find out, guys. We're going to play this video. Um this is in reference to the Poly Market hair incident. And so, if you guys are unfamiliar, uh there was a weather market. I think it was trying to predict the highest temperature that was going to be uh taking place in Paris, France. Uh there was one sensor. This was the resolving oracle uh for this

poly market. It was one weather sensor, one temperature thermometer outside of a bakery in Paris. uh someone took a blow dryer, hair dryer to that sensor, heated up the air around it so that the thermometer registered a higher temperature, resolved the poly market at that higher temperature and then the temperature dropped right back down. Uh so they were able to essentially exploit the oracle uh around this particular poly market. A very creative creative little hack uh and they were probably able to profit a decent bit of it. Uh poly market insider trading is something we'll cover a little bit later. But first, let's hear from Gabriel about what he has to say about this particular uh this particular poly market incident on my phone while doing the Uber. But I

lost a whole bunch of money on coin. I was looking for more profit avenues. They measure the temperature in France. How do they measure the temperature? And I saw that they measure it at Charles Gol. They take all of the data from one thermometer. I climbed over the fence. I walked in and this is the first time I did it. It did not work very well. Had to just blow on the sensor very hard.

[sighs] I lost more money on that one. But and this time I brought the haird dryer at the first time. >> I brought the air dryer in a backpack. No security. No security whatsoever. I went like this and voila. I told her no into a we and now I'm in the French Riviera living my life looking for the next opportunity next opportunity. Thank you very much to this air dryer. I will be trading more on poly market. Well, uh, man, hang on, Gabriel. Hang on to that haird dryer, man. You can make a lot of money using that hair dryer. You just go around, find the thermometers out there. There's a lot of poly markets

out there. You can just heat up with that hair dryer. Um, you got the you got the flow going on, too. You can dry your hair. You can heat up some thermometers. You can make money. You can look good. What else do you need? Gabriel's living the life. These these guys, you know, code is law out there. Uh, we've obviously seen that's how the North Koreans think about it. Gabriel seems to think about it, you know, the same way. If you if you got a haird dryer and you know where the thermometer is and there's no there's no one stopping you, go get your bag, Gabriel. Go do your thing. Absolutely love your content and uh you're you're you're hilarious, man.

Just just keep it up. Uh feel free to come on the show whenever you like. We we can talk we can talk all about it. Uh shout out to Gabriel. True. true OG in the crypto culture scene. Love, love that guy. All right, guys. Um, I think we're gonna be talking a little bit more about uh this Poly Market Insider trading. Let's go ahead and and and get to what Trump thinks about polyarket insider trading. What does Trump think about Gabriel? Obviously, Gabriel [laughter] was the guy that heated up the thermometer. >> [snorts] >> Uh they also arrested um a soldier uh who must have had advanced knowledge about the Maduro capture in Venezuela.

And so we have a reporter here talking to President Trump uh about what he thinks from this uh from this capture uh uh this this insider trading on Poly Market about this capture. Let's let's hear what he has to say. >> Well, on the Iran conflict, And there have been some trackings where people suspect that there's insider trading happening on these prediction markets around the world. Are you concerned? >> Well, you know, the whole world unfortunately has become somewhat of a casino and you look at what's going on all over the world in Europe and every place they're doing these betting things. I was never much in favor of it.

I don't like it conceptually, but uh it is what it is. No, I I think that I'm not happy with any of that stuff. But they have all these different sites. They have predictive markets. It's a crazy world. It's a much different world than it was. >> Okay. >> On the conflict. >> So obviously uh you know this is a bit more a bit more serious. I mean Trump is somewhat you know he's condemning insider trading. He's also saying that he doesn't believe in gambling. He's not much of a gambler himself. He doesn't believe in it believe in it conceptually. Um but obviously people are you know they're placing predictions. They're making bets.

Sometimes there's insider information and these people are able to profit quite a bit. Um, obviously a lot of this is taking place on the prediction markets. Khi poly market. You just heard you know Gabriel talk about this as well. Um but another part of this is that you know on oil in particular every time uh Trump seemingly makes you know an announcement whether it's closing the straight opening the straight there's a there's millions of dollars of investments predictions bets trades that are placed on Brent crude uh you know shortly before that announcement or that truth social post is made and I think this is kind of a two-parter um you know Trump would maybe say the same thing.

These are just people in a free market. They're able to, you know, kind of create uh create their strategies and their thesis as they like. Um when it comes to these prediction markets, we've heard that it's up to the prediction market to police the markets themselves. The regulators are going to come in and they're going to enforce some of these rules, but the regulators aren't watching over every single market. My understanding of how this this works here is you you have a market uh and let's take KHI because they've been US compliant for a long time. Poly market just recently launched their US app but it has limited markets as I understand it. Khi has a much wider breadth of markets. Um and so what they do is they

say to the to the CFDC uh they say hey we want to launch this market. [snorts] uh and the CFTC says okay you know we don't see any glaringly uh uh you know problems with this market so they so so Khi launches it and then you know people come in and they try to exploit right they they say hey you know if I'm a dancer at the Super Bowl I know what song is going to be played first if I live near the hair near the temperature I can use a haird dryer to heat the thing up if I am in the army and I know we're going to go into battle we're going to capture Maduro we're going to capture someone else. I can use that advanced knowledge to make these bets.

Now, where's the, you know, how is this different from Nancy Pelosi in Congress and these politicians that know of these like FDA approvals for these pharmaceutical drugs, buying a bunch of those stocks before this this approval, you know, goes through. There's no difference, right? You you can't talk out of both sides of your mouth. And so, do I think it's wrong that politicians are profiting off of um you know, uh the advanced knowledge that they have at these at these at these drug companies?

Yes. You know, given that that's happening, a little more lenient for these guys that are, you know, they have the advanced knowledge, they find themselves, you can't act on it, right? But there's a very gray line between this and then building a thesis. If I do significant amount of research, I find details on a particular subject. I do a lot of reading, I do a lot of research, I talk to experts and I start to build a thesis as to what I think is going to happen in the future and I build a portfolio and I construct portfolio whether that's stocks or bonds or digital assets or something else.

What's the difference? You know, I'm trying to get some sort of edge in the market, some sort of information that I have that others don't have, right? at at a certain point the line gets a bit blurry. I think if we're going to hold people accountable and we're going to hold these platforms like Kshi and Poly Market accountable for enforcing insider trading on their platforms, we also need to hold accountable the politicians that are profiting from their insider information, right? We we have to do it both ways. And I think that is just as important of a question, if not more important of a question, you know, because right now we're just praying on like guy in the military. I mean, shout out to our troops. like they're they're doing good work. You know, we we don't want to hold these

guys hostage for making making some more money on the side. The politicians need to get held accountable just as much as everyday people. Um and ultimately, you know, there should be some sort of rules, regulations put in place. Otherwise, the alternative is just make all insider trading legal. Make it okay. Make it legal. You know, I it's either make it all illegal, including the politicians, or make it all legal and say, "Look, if you're gonna get into the role, if you're going to get elected as a senator, then you've done the work.

You've earned the ability to some proprietary information and you know, you go make the markets efficient, right? If you have information, go trade on it, right? So that the the market as a whole, these truth seeking, truth uh identifying markets, give us the information that we're looking for, right? If we want to know how something is going to react, then as that information drips out of the future, we should be acting on it, whether it's private, insider, or or otherwise. And so that's my take here. Um, look, I I think if we're going to do this, we have to do it both ways. We either have to make it all legal or all illegal. Uh we can't have politicians and say that's

okay but not you know the little guys trading on poly marketing call sheet. No no no no no. Do do both. Don't do one or the other. All right let's move on here. Uh we've seen again this dislocation in the market. What's happening here? you know, we we talked about it uh on our market segment how the bottom, you know, altcoins are performing better than some of these macro caps. Um what we also have here is these large inflows uh into ETFs. And so we've seen this basically how boomers are coming in and they're they're continuing to slam these ETFs.

Obviously, Bitcoin isn't moving so much. Some people attributed um the move from like the mid6 60s 65 68 up to the mid7s right uh attributed that to um you know obviously Iran in the macro situation but also Michael Michael Sailor uh enormous buy I think the third largest buy ever uh and the success of his stretch product and so as Bitcoin goes up there's more income products that he can sell and this continues the flywheel forward um and so this is uh part of what's fueling this again we have these large ETF inflows and so James Seart uh friend of the show uh the the local ETF guy here at the rollup talks about a

riskon rally I mean S&P 500 ETFs taking in the top three spots over the last week ETFs have taken in over $ 35 billion in aggregate ARC K uh shout out to ARC is number four on the list with over $1.2 2 billion over the last week. Tech sector ETF number five, Bitcoin ETF, IBIT number nine. So, these ETFs are seeing a rally. I mean, Nvidia today is up something like two and a half%. It's all it's making all-time highs. The S&P is making all-time highs. NASDAQ's making all-time highs. So, stocks are continuing to rally. Uh digital assets are continuing to lag. Now, you can look at this one of two ways. You can either

say, you know, the market's irrational. We're not paying enough attention to the Iran war. This could cause global catastrophe. Stocks are getting overheated. You know, I saw Google is going to uh uh invest $40 billion into anthropic. This circular investment strategy is just a game of musical chairs. Uh the market is going to kind of reach what digital assets have already realized. Or [snorts] you could say, look, digital assets are are just lagging, and once we continue to see stocks go up, uh, we we have a little bit more certainty in macro, um, and we get kind of over this four-year cycle hump and liquidity conditions improve.

Well, we could see a catch-up trade. We're [snorts] already starting to see it. I mean, look, we went from 70 to 78. I don't think we can expect as much volatility in the Bitcoin markets as we're used to seeing. These things are already as volatile as what we're seeing in stocks. Couple percent here, here, couple percent there. It's not 10 percent moves daily anymore. So, obviously, the market structure is coming back to life after 1010. We're still repairing. We're still recovering. Look, I think the most bullish thing that has happened in the digital asset markets is that we haven't collapsed as a result of this RS ETH exploit. Let's talk about the RS ETH exploit and see how how that's going.

Uh, and so what we have here from DCFG God, we have uh an update on how how the the tracker is filling up. And so this is where we we started. Let's scroll down to what I believe is current. Um, I believe we've gotten several more um several more updates. I believe there's there's quite a few after Mantle came in. Uh, we've just been seeing more and more BGD came in. Uh, I think there's more here. Can we continue to scroll?

Yeah, here we go. Keep going. Let's keep going down. Keep going down. The last one from DCF god is the most recent. [snorts] Um, and so I don't know if we have the ability to expand here, but what we have here. Yeah, there we go. So, 23k ETH left. That is less than what arbitrum found. That's less than what Mantles proposed to loan. And so this is an incredible effort from the entire DeFi landscape. And so let's just give a shout out to everyone who's committed some some funds here. Lido two and a half thousand ETH. Uh Ether 5,000 ETH.

Arbitrum found 30,000 ETH. Obviously we talked about their security council coming in. Uh they were able to freeze that ETH. Uh which was which was um look it was very contentious. Uh people call this not decentralized. At the end of the day, they had a rally, a nine out of 12 security council. I think this was the right thing to do. I've been going back and forth with the Thor swap people who I think honestly flopped. I think if they had the ability to prevent uh North Korea from uh moving funds from uh this RS ETH exploit through Thor Chain into Bitcoin, I think they should have stopped it. Uh they collected about a million dollars in fees. I think they shouldn't certainly shouldn't be profiting from it. Uh and so I think

those fees should be rerouted to this uh to ultimately paying the people back who uh you know are the rightful owners of this Ethereum. And so Arbitum was able to do this. Uh we'll see if Thor swap does it. Athena didn't say how much assuming 1,000 ETH uh excess RS in a compound about 15,000 ETH. Stani 5,000 ETH personal donation. Incredible to see. It's about $10 million. Uh layer zero didn't say how much assume 5,000. We'll see. Layer zero has been suspiciously quiet uh since their uh postmortem.

Mantel 30,000 ETH. Um they structured that as a loan. Kraken 5,000 Golem 1,000. Couple more people have come in and committed ETH. Uh I believe BGD, I believe Fracks, I believe there's more people on this list. Uh we just haven't gotten an update from DCF God to total all of this up, but we are closing in on uh the uh 18,000 ETH that we are looking to that hole that we're looking to fill. Uh only 20,000 ETH or so still left. Now, I was seeing a lot of people commit to this, right? Obviously, we're we're seeing this we're seeing this list. I was unsure like are these just

donations? you know, we've seen like this DeFi United fund, right? Mantle is structuring this as a loan. Obviously, a you know, make significant revenue and uh we even heard uh Mark Zeller, the ex contributor, uh talk about what his proposed solution would have been, which would have been, hey, put together a DeFi United pool on a let people deposit into it, um and then, you know, charge some sort of interest rate. you can get an interest, you could charge a fee, and then all of that revenue goes to plug the hole and then just slowly plug uh plug this hole over time. I think that would have worked, but it would have taken a lot longer in order to plug the hole. Um people maybe could have pulled

their ETH out. I would have seen, you know, probably a lot of people uh pull their ETH out. And the issue is if Ethereum's price starts to move away from these suppliers, we could have got into some pretty sticky situations if they weren't able to pull all of that ETH out if people were still stuck. And so that's kind of the issue with leaving funds uh in there uh and and letting this repayment plan take place over time. Uh but that would have been one alternative. This I do think gets us into a solution much quicker. Uh but I was curious, you know, what is DeFi United? What is this fund? And so according to Grock Defi United is a temporary aled coordinated relief

initiative uh also described as a coalition a relief fund or dedicated relief vehicle uh obviously in uh response to the kelp RSE ETH exploit via layer zero. Uh this authorized the minting of $116,500 just about $290 million uh which uh attackers used as collateral on a uh created significant bad debt. Um and then now you know this goal is to restore the ETH uh backing uh to cover the shortfall any of the bad debt and uh you know resume these markets on a so yeah we had key contributors um uh like mantle etherfi a lido others what

do contributors receive in exchange uh and so this was this was particularly what I wanted to what I wanted to to get out here so not at not all contributions are identical. We know this. Mantle is a loan with explicit financial and strategic returns. Most others are framed as a one-time contribution or donation primarily for ecosystemwide benefits, which would mean that they don't get anything in return. Uh mantle structured as follows. Uh interest at lido staking yield at 1% APR variable or negotiated. Maturity up to 36 months, right? Uh in which they would be allowed to repay with no penalty. First priority lean on the loan ETH held in a mantle designated multi-IG safe wallet. A

provides additional collateral greater than 11 million of fair market value in A tokens. So they're looking for A to put up some A tokens in addition to the 30,000 ETH and 5% of A protocol revenue allocated to the wallet. So this is part of you know a cash flow that would help a po pay back uh or repay this loan. Uh delegation of 130,000 a tokens to mantle for voting rights and a governance. Uh so they wouldn't take possession of that but that's still a pretty good pretty significant amount of a that mantle would get in order to vote in a governance. I don't know how long that would last. Uh and it positions mantle as a first response liquidity provider

in defi stress events. Obviously they have uh bybit and mantle have the funds um they don't want to just donate these funds it would be a lot of capital to donate um and so uh and so yeah you know they can ultimately provide this capital pro inject this liquidity save a uh which is going to be a positive to the ecosystem as a whole and then get paid back over time uh and so it's it's really great that mantel and bybit are in a position where they can do this they can provide capital uh they can get paid back over time probably with interest uh and they can step in look like the good guys and be a savior in uh a really really strenuous time for DeFi as a whole. So shout out to Mantle. Um I'm surprised that more teams did not

structure these contributions as a loan. I think uh a lot of these are going to be contributions, donations, that sort of thing. Um but we'll see what kind of favorable treatment they get after the fact. do think they should get something. Mantle is doing this uh and and you know they're going to get paid back in return. Wouldn't be surprised if more of these teams structure this as a loan uh which would get them something in return as well. Overall, great to see. I'm glad that teams are stepping in to fill the hole for one of the most uh systemically important uh DeFi protocols on Ethereum. good to see the community rallying together and also it's just great to see that

this is this is coming to to a close on this chapter. We're going to be talking about this for some time, I'm sure, but obviously there's uh more things happening in the industry. So, let's keep going. we uh we circle back to another another friend of the show, another ETF uh another ETF guy here, Eric Balotunis, uh talking about more on the legacy financial side of things, Jane Street, uh who made about $40 billion in revenue last year, more than all the big Wall Street banks, but only 3,500 employees. Now, 3,500 employees sounds massive to, you know, us over here, accustomed to to the guys, you know, at Hyperlid that are doing this.

Um but it's great to see uh Jane Street uh you know uh uh not an incumbent a disruptor that is doing quite well. Uh 39.6 billion of trading revenue uh firm flew past global investment banks uh after reaping 15.5 billion in the year's final quarter. Uh according to people uh with knowledge of these results who asked not to be disclosed uh with only 3,500 employees, it beat JP Morgan by 11% during the year. Obviously JP Morgan is a Goliath. I think they have 100 times the amount of employees, closer to 350,000 employees um over at JP Morgan.

And so, look, we're going to see a lot more of this. [clears throat] AI and the people and companies that know how to use AI are going to massively accelerate and then therefore outpace what the traditional incumbents are doing uh with their manpower. So, you've got compute, compute power, and you've got manpower and uh compute just moves a lot faster. And so, this is what we're seeing. I think we're going to see a lot more of it and it's just a it's a shout uh to all these companies to embrace it before it replaces you. Uh disrupt yourselves before you guys get disrupted.

Let's keep moving on. Uh next we've got a clip from the vault. So guys, I watched the uh Finding Satoshi documentary. Uh it was really well done. I think Coinbase helped to produce it. They talked to FBI. They talked to uh private investigators. They did a really really great job of going through talking to experts going way back into the lore of the OG Bitcoin days and talking to the people that were there on the ground emailing with Sat Satoshi.

They were on the Bitcoin forums with Satoshi. They were going back and forth with these people. And so they did an incredible job uh of going and talking to the people that were there with firthand accounts of interactions with Satoshi. Um I don't want to spoil the documentary. It's great. Uh I think it costs like 17 bucks. You guys can go find it. It's called Finding Satoshi. I encourage everyone to watch it. Um and what we have is a disconnect actually. Uh if you watch it, you'll notice there were some conclusions drawn. Uh they started with a group of about six or seven people. A lot of them were early contributors and employees at a company called PGP. Stands for pretty good privacy. Uh which was a very early uh

contributor in this cipher punk crypto cryptographic anarchy uh movement. Uh they were protesting uh the nuclear threat um that was taking place in the 80s and 90s. This was as the internet was becoming more available, cryptograph cryptograph cryptography and cryptographic standards were becoming more of a field and so they formed this group BGP pretty good privacy to create this encrypted messaging service uh where they could exchange messages. This was pre- email I believe right around the time where email is being created.

Uh and so they wanted an encrypted messenger uh where they could communicate back and forth about protests around nuclear um nuclear war. This guy got contacted by the authorities. It's a great documentary. I encourage everyone to watch it and it led to a lot of people a lot of cipher punk ideals and ultimately the creation of Bitcoin. Uh, in that documentary they mentioned Hal Finny, they mentioned Adam Bach, they mentioned Len Strasan, uh, they mentioned uh, we die. Several people that have all been theorized uh, to be connected to Satoshi. And it made me think of this clip uh, from uh, our friend of the show, Jeff Garzik, very early uh, OG Bitcoiner, Bitcoin

core developer. Um, and so, uh, you know, here in this clip, we ask, uh, we ask Jeff who he thinks Satoshi is, and you know, if it's consistent with the with the findings in this documentary. Let's go ahead and play the clip and, uh, and and see what Jeff has to say. It was a uh Palm Beach, Florida County sheriff who uh got into a a motorcycle accident and uh after that accident uh self-taught themselves computers, computer security and uh that seemed like uh and the they died shortly after

Satoshi uh kind of moved away from uh Bitcoin in uh early 2011 2012 time frame and so that uh that kind of uh roughly fit the profile and time frame and that was my best guess but uh I really don't have any hard evidence and I haven't seen uh you know the only thing I do these days is kind of debunk Satoshi claims no Elon Musk is not Satoshi [laughter] you know no malfenny is not Satoshi >> Treasure is your home for self-custody use code rollup10 at treasure.io IO.

[music] >> All right, we can go ahead and pause. >> And so, you know, obviously a meta meta moment here as we uh you know, we >> uh cover a clip from the rollup from from some time ago. Uh but Jeff here is referring to Dave Climman. Uh he was a Palm Beach County Sheriff. Uh and then he I believe he retired from from the police force and uh he he started taking an interest in computers and cryptography. He was also a member of the early group of cipher punks from which a lot of these guys came from.

Um this uh this metow cryptography mailing list which was the first place where the Bitcoin white paper was posted. Now, Hal Finny and these other guys were also part of this group, but it's theorized that obviously, you know, the the person would have had to been a participant or active on this mailing list in order to know about it and and in order to post the Bitcoin white paper there. And so, I found it surprising that, look, this is Jeff's best guess, Dave Klyman. Uh, and Jeff is an OG Bitcoiner, OG Bitcoin Core developer. I think he said he had the third most commiss commits to the Bitcoin uh GitHub uh or repo back when it was being formed. And so uh tend to trust Jeff's

perspective on this thing. Like he said, no no hard evidence. But I was surprised that Dave didn't even come up in this in this documentary. And so I I also just want to read here a little bit more about Dave Kleimman. Uh for anyone who was, you know, watching this documentary, found this interesting. Uh so he was an American computer forensics expert. Uh he was an author co-author of multiple books, frequent speaker at security related events. Now another guy who story history here Craig Wright. Craig Wright claims that Kimman was involved in the invention of Bitcoin and that Wright himself was Satoshi.

Okay, Bitcoin's main inventor. Right. So Craig Wright. So, so climate is kind of mixed up in this Craig Wright saga. Craig Wright claims that himself is Satoshi. Obviously, if he was Satoshi, could just move the coins. He's never been able to do that. And so, maybe Climman has been discounted because Craig Wright claimed that he was involved. Wright's claims were subject to litigation in London where it was subsequently declared he is not Satoshi. Did not write the white paper nor the Bitcoin software.

And this is, and you'll see this as part of the uh as part of the documentary, there was some some divergence between uh who wrote the white paper and who wrote the code, which seems like the most plausible theory. But again, Jeff, you know, claims Climman. Um let's read a little bit more about Climate here because you guys can watch the the the documentary, learn a lot more about some of these other guys. Klyman uh at the age of uh 21 in 1988 was named as US Army soldier of the year. So he was he was in in the army uh after distinguished service in the army returned to his hometown became a sheriff Palm Beach County in 1995. Motorcycle accident left him

paralyzed uh requiring the use of a wheelchair. After his recovery, he continued working at the the sheriff's office. Um, attained the rank of a detective. He also worked as a system security analyst in the computer crimes division and helped configure the computer forensics lab. Uh, Climman went on to work on a number of high-tech companies before becoming a partner in a computer forensics business. Klyman died in his home in late April 2013, seemingly of natural causes uh related to complications from a MRSA infection.

And so, you know, let let's just read a little bit more about about his alleged Bitcoin involvement here. Uh so, he had several uh licenses and certifications in cryptography. uh he was um uh part of a technology that was used in NASA, the department of the treasury, uh worked on SDOC. Um so these deep deep cryptograph cryptographic standards, his alleged involvement, uh so in December 2015, Gizmodo reported that Dave Klyman may have been involved in the invention of Bitcoin based on documents sent to the press concerning Craig Wright's claim to be Satoshi. Wright claimed uh he was Satoshi and The Economist. Uh he claims

his claims were struck down in London following that litigation declared not to be Satoshi. In February of 2018, Dave Klyman's brother Ira, the ex executive of his estate, initiated a lawsuit uh in the district of Florida, Southern District of Florida on behalf of the Climate Estate against Craig Wright over the rights to between 550,000 and 1.1 million Bitcoin. That is Satoshi's entire stack, claiming that Wright defrauded the estate of bitcoins and the IP rights. The estate alleged that Climman was one of the early Bitcoin pioneers and worked with Craig Wright on Bitcoin's establishment and therefore had a legal claim to these bitcoins, these Satoshi's bitcoins. Following a

three-week trial in 2021, a jury entered a verdict in favor of Climman's estate, but awarded him only $und00 million in damages, far less than the more 25 billion that Climman's estate had sought at trial. Very interesting, right? Uh according to this jury, the jury found him um as part of early Bitcoin involvement. However, you know, Craig Wright was found not to be Satoshi. Maybe had some involvement, right? But Climman was involved and and therefore had hundred million dollars in damages. Didn't have a right to Satoshi's claim, Satoshi's coins. Even if he did, look, how would they have

moved them? I don't know. It's fascinating. Um the reality is that unfortunately Kimman did pass away. And so if he did, if he was involved, um, you know, if he if he had some, uh, some of those private keys, you know, he's not able to, uh, move those coins now. And that's a common theme from this documentary if you if you watch it there without giving away too much. So very fascinating. Satoshi's, uh, whereabouts and identity obviously comes up once in a while. Um, so it's it's pretty interesting to see. Um, all right, guys.

We've got a little bit more news to cover. Uh, let's check in on how our first guest is doing. He's still setting up in the back. So, let's keep going. Morgan Stanley launches stablecoin reserves fund. Um, and so we've got uh we've got Morgan Stanley coming into the into the stable coin game. No surprise here. Stable coin reserve fund. Morgan Stanley introduced Stablecoin reserves portfolio, MSNXX, money market fund built for stablecoin issuers and aligned with the Genius Act fund invests in cash, treasuries, and overnight repo agreements to maintain a $1 NAV. Uh, pretty cool. I'm glad that Morgan Stanley's coming in and I think

they're getting in multiple ways, which is great to see. And so, look, stable coin issuers need compliant reserve management. I think this is what we're going to see. This way, they can earn some yield on these treasuries, these overnight repos. Uh, and they continue to use this fund as a reserve to back stable coins. Uh, and so obviously there's going to take some time in order for this to be implemented. Stable coin issuers currently have their own reserves strategy, the reserve management strategy. Uh but it's good to see we have more qualified custodians, more reputable institutional players coming into the reserve management business.

This is going to be an actively managed fund. I believe you see non-speculative highquality assets make up this fund. Stable coin issuers can leverage this fund. They can use it to back their reserves and continue to maintain Genius Act compliance. Shout out to Morgan Stanley. I anticipate more stable coin issuers are going to be using this to back their stable coins. Let's keep going. We've got maybe one or two more here. Charles Hoskinson is making a declaration.

This guy, I mean, Charles is on the show. Was making some really, really great points when it came to security. The guy is obviously very technical. Uh, no matter what you have to say about Charles, uh, the guy is technical. He knows his stuff. He's cut his teeth. Here he is talking about politics. maybe a little bit out of his domain of expertise, but let's see what he has to say about the Clarity Act. >> It wasn't wise back in 2025 to go toe-to-toe with the president of the United States about things I felt were wrong. In hindsight, I appear to be vindicated. Perhaps it's not right that they issued their own coins, they built their own projects, and

sculpted everything for their own benefit. And now where are we at? A resigned cryptozar no clarity act and a very difficult election season where the democrats have already taken a position of anti-crypto much more so than Gary's days. And they're even funding documentaries like everyone's lying to you for money just to tar and feather our space and throw out the baby with the bath water. All the good we've done doesn't matter because crypto equals Trump.

Yeah. >> Took courage to step up and say, you know what, enough. We have to move beyond a person, a philosophy, an agenda, a country, and recognize this global >> movement. You know, Charles, I I I tend to agree with you. I I think you use a little bit of uh uh embellishment, a little bit of dramatic, verbose language here, you know, move beyond an ideology, you know, but it is serious. And uh I I tend to think that your point is a good one. Um crypto, digital assets, all of these things have been so tightly associated with the Trump family. Insider trading, corruption,

crypto, memecoins, all of this is getting really, really tied up uh with the Trump family, the Trump presidency. And I think we do have to make that disassociation and we have to untangle these things or else the Democrats are going to absolutely just like you said tar and feather our industry uh in the coming election uh in the coming cycle of the new administration if they take the office uh becomes a real problem. Uh and so you know what what is there to do about this? How do we differentiate these things? Look, I've been I've been on this show saying that the exports of crypto are still in a good spot. Um, stable coins are pretty much neutral.

People don't really hate stable coins. Um, you can even point to some of the more technical aspects like ZK, like FHE. Um, you can point to things like even blockchain is somewhat uncontroversial. But when you talk start talking about crypto, crypto as it refers to crypto as the asset class, people using the assets as a means of enriching themselves as a means for insider trading. Prediction markets are not helping in this regard. um it becomes it becomes a really sticky situation unfortunately. And so I think what we can do as companies is we can start to think okay let's let's let's start to you know prepare ourselves for what a democratic

or a Democrat administration could look like and let's work closer with the regulatory agencies like the SEC, the CFTC because those guys they've been appointed they're going to be in office. they are currently uh there and willing to work with our industry. We don't know how long that is going to last. So, let's work with them. Start to get some regulatory guidance. If we can't get legislation, let's get regulatory guidance from these agencies so that they can help inform us on making the right decisions for when a Democrat administration or agency comes into effect. That's number one. Number two is as an industry, let's stop using some of the language that has now a bad reputation. All of we we're known for

creating these definitions day in and day out. Let's throw out the bad definitions, the ones that have already gotten commandeered by people with their own agendas. We can stop using the word crypto. I know it has some sort of momentum and gravity, but let's stop using it. Let's use digital assets. Let's use some of these things that people just don't have this intrinsic emotional reaction to. People like stable coins, let's use stable coins. People like digital assets, let's let's use digital assets. These are some of the things, right? High quality assets, onchain, you know, these protocols. People like some of the aspects, some of the exports of the industry. They like some of the principles, some of the ethics, some of

the decentralization, permissionlessness. Let's hang on to what people like and let's disre let's get rid of what people don't like. Not because just, you know, we're just bending the knee, but because we're taking the market feedback, right? And we can throw out the bath water without throwing out the baby. Keep the good parts, throw out the bad parts. All right, guys. That's uh that's my rant for today. Shout out to Charles for giving us a little bit of a kickart to the rant. We've got our first guest.

He's ready. We're going to go ahead and bring him up in just a moment. Uh and our first guest is going to be on AI Supercycle. This is our flagship AI show. We're going to bring him up uh and get started here. So, shout out to Near. Thank you, Near for being great supporters, doing the good work. Uh people like the uh the cross between uh AI and uh and blockchain here. uh they don't want AI to run rampant. So Near's helping do all of this. Speaking of this cross, we're going to bring Cross Mint.

We're going to get Alfonso from Crossmint onto AI Super Cycle. Let's run it. Let's do it. [music] Welcome back to AI Supercycle, our premier AI show airing every single week presented by Near. We cover the ins and outs of decentralized AI privacy and the future of this massive technology. Near is the blockchain for AI and the execution of AI native apps. You can check out Near's latest AI product at near.ai.

Sit back, relax, and enjoy the show. All right, guys. We are back. We're here with Alfonso of Cross Mint. Alfonso, welcome back to the show, man. It's a pleasure. >> Uh, it's a pleasure. Uh thank you for for having me again. >> Absolutely, man. Well, uh I know we we've, you know, talked about several things. You guys at Crossman are doing doing great work. Uh most recently, believe you guys have a a partnership with Mastercard. Uh and and also around this AI agent payment framework. So, we want to talk all about it. Uh before we get into the Mastercard partnership, just give us a little bit of you know, is this p been your primary focus? Get us caught up on on what's been going on in your world since the last time we had

you on the show. Yeah, [clears throat] absolutely. Um, I think just just 10 seconds, but Crossmin is a a infrastructure company in the programmatic finance space. Most of the work we do is on stable coins actually stable coin enablement and I would say uh still the majority of the things that we see going on are like company like FinTex on the remittance space or neo bankanks things like that that are starting to enable stable coins. However, a lot of our product development and where we see the future going is is all on Gentic Finance. And so, yeah, on our end since last we spoke, we've been rolling out uh better support for what's called like scope cards or

Aenteek cards, Mastercard announcement. We also announced something with American Express recently. Um, and yeah, lots of things to talk about there. But I would say uh we we're seeing progress all over the all over the place. uh not only not only Finance, but I think there's also a lot of stable coin enablement happening in the world and trying to somehow do all those things together. >> Very cool, man. Very cool. So, before we get into some of the nuts and bolts about how this integration works, just what is it like? You know, you're you're going in, you're talking to Mastercard, you're talking to American Express. I'm sure they get pitched a million times, you know, AI payments, AI AI agents like stable coins or something that they've been talking about. Why are they taking you serious?

Like what what is it about Crossman that American Express and Mastercard, what what is it that you bring to the table for these companies? >> Well, I think in a way what I would say is like every major financial player is trying to uh make sure they're up to date and remain relevant with all these transitions that are happening. Again, there's one on the stable coin side and another one is on on aentic payments. And uh on the crossing side, we've just been doing specifically aic payments now for around two years. Um and we've been gathering a lot of developer attention. So we've been useful to these companies to help help them bring last mile the the thoughts and technologies they have into the

hands of uh of developers. So we've been a good partner in terms of giving them developer feedback actually getting uh the like let's say first payment outs and and things like this and in a way we're we're basically the glue between ultimately indie developers or the the developer on the street and uh the the car network companies. >> Very cool. Very cool. And so yeah how how does this integration work? you know, uh I I believe OpenClaw, you know, is something that you guys are helping to enable the payment network between OpenClaw near, you know, our our sponsor of this AI show, uh has has announced ironclaw, which helps tighten up a lot of the security, uh around these agents.

And so, yeah, talk us through, uh talk us through lobster cache, talk us through the Mastercard agent pay, tell us how this integration works. >> Yep. [clears throat] Um so uh let's see. So maybe for folks to to help understand the different layers and what's happening. First I'll explain the the end thing that the end experience that Mastercard and all these car companies are trying to achieve. The the problem everyone is trying to solve is if in the future the majority of your purchases online are intermediated by an AI agent. Uh let's say you tell an Asian automatically do the groceries for me

every week based on my nutrition plan or what have you or figure out a uh my trip to Europe and buy everything on my behalf is how can an agent securely uh take payment method specifically your your credit card and go and purchase online without screwing up causing a lot of you know incorrect purchases leaking the data etc. So this is the problem that everyone is trying to solve. Now, how is this problem getting solved? At the card network layer, uh each of these companies Visa Mastercard American Express, Discover are rolling out initial protocols or standards that allow an AI agent to request a scope

card based off your existing credit card. So, let's say you have a Capital One card that has a $10,000 credit line. uh you you don't want to give your AI agent the $10,000 to spend and directly the raw card number. Instead, with this new API they're releasing, you will uh be able to tell your agent will be able to say, "Hey, I need a a card for a 100 bucks only to buy groceries in these five merchants." And then the agent will get a virtual card number similar to, you know, the one you see maybe in Apple Pay or things like this. And that's the only thing that the agent will will have and be able to use. So worst case scenario h it cannot do more than $100 spent in

those merchants. Okay. So this is work layer that's getting enabled. >> Yeah. They can request uh like a gift card and you and the the user can approve the gift card for the agent that gives them maybe a much smaller limit maybe $100 something like this. >> That is correct. Uh it is not technically a gift card. It's really like a it's a new instrument, but it's a virtual card that is derived from your original like capital one card. You still keep the points, you see it on your statement. Nothing like that changes, just that the agent can only spend that amount. Um, and so this is being enabled at the network layer and what at CrossMe we're doing is making

APIs so that any agent platform can use this easily and you know don't have to do an integration with each of the card vendors. And then in lobster cache is a blueprint is a open source website where we're basically showcasing all of these things showcasing all of these integrations and also you can it's at the same time it serves as an open source wallet that you can give to your own independent AI agent if you're building your own open co at home or using zo computer or uh many of the other ones that that that that exist. So lobster cache in a way is like a package of all these things that any developer can integrate. It's open source and it's ultimately a showcase of all of these technologies. Um even though at the end

of the day it's not a commercial product on our end or commercial product would be working with agent platforms or embedding everything white label and more natively. >> Very cool. And so you're helping a lot of these card companies kind of connect to the agent infrastructure out there. Like OpenClaw's got a million agents out there, right? And so what is you know I I I also see here you guys are using verifiable intents right so you're giving agents cryptographic um cryptographic authorization um like what what are some of the things that you're targeting h how of these a million agents how many of them are you targeting with you know what would be the success is it 100,000 agents 200,000 agents >> well so [clears throat]

um let me go by pieces first they verified intent is interesting one. Um, apologies if I get too technical, but I think it's an interesting thing for people to start to understand because this will become >> uh right now it's all new technology, but down the line like it's a a core primitive of I think how how this uh entire agentic economy is getting set up getting set up. But ultimately the the challenge you have with agents is a bit like the principal agent problem that you have in you know the real world or or you could maybe an analogy is like imagine you have a a personal assistant and you you want to give them tell like give them your card to go buy things. No if you really really really trust your assistant you will give them your full

card and you know after you've established that relationship you'll you'll be like okay take my card and I know you're not going to do anything weird with it. But maybe when you hire a new person the first few months you don't necessarily trust it. So you don't want to give full unbound access to to all your financial instruments. So um when you do this with AI agents um um basically what all these technologies are trying to solve is scoping down the the access that you give to the credential that delegation to something where first the agent cannot break out from it and if it did you want to have a cryptographic proof of hey this is the thing that I had delegated and then later if there's a dispute I had told

the agent it can only spend $100 in groceries and it actually spent $200 in something else and then who do I go complain against? Let's say I go to again chat GPT or whatever to complain against. So verify intent is a framework co-developed by Mastercard and Google that helps more or less encode what is the original user intent. What what did they actually tell the agent to do? And then it helps them check when at the time of purchase is that intent being um you know like is is the agent actually doing something outside of that original intent. No. So it's a bit of a framework to encode what did the user want to buy and is the agent aligned with it or not.

Um okay that was the first question. I think your second question was completely on adoption. Uh let me know if >> Yeah. Yeah. Ex exactly. So that that makes sense on verifiable intents. Um and so out of these a million you know agents that openclaw instances uh have been deployed you know how many are you targeting what kind of adoption rate do you think is possible here >> yeah so [clears throat] uh so it's interesting so I I we do see a future where every agent almost every in the world will be a financial actor okay for many different things doesn't mean like every agent that everyone that installs and claw is going to use it to buy groceries or shoes or things like that online. Um, however, there's a

separate thing that agents are starting to pay for which is more like microp payments for their own compute, for inference, for the tools they use. This is more on the stable coin and cryptoc. Uh, but that one we do expect the majority of agents at some point are basically going to self-und themselves. they will have a maybe let's say $1 in a wallet and use that to pay for their own bills and whatnot. So, uh that side of the ecosystem, you know, I think the total resol market is like almost any agent. Now, cars that are actually doing e-commerce for their customers, you know, it remains to be seen. Uh I I do think at some point all e-commerce

will be done this way. So, the total resol market is very big. However, in the current uh usages of open claw and those million agents that you see out there, um I would say e-commerce use cases are still small. Uh so on our end we don't have a concrete target adoption. I mean ideally we want to serve all these agents in one way or another specifically uh these uh scope cards from Visa Mastercard. I would say, you know, maybe 10% of those eventually using them would be a an an awesome target to hit, but I would not expect a million because many of these uh are more ephemeral or doing a very specific task that that may or may not overlap with with again uh like

e-commerce or travel or those kind of use cases. >> Yeah. And so h how easy is this to set up? Like uh where where would I go? Let's say I have an openclaw instance. Um, you know, maybe I have an American Express card. Do I go to American Express? Do I go to CrossMint? Do I, you know, h how how do I start uh letting my AI agent request these cards? >> Yeah. Um, look, so, so the idea behind all of this here, I'm being maybe a bit technical and getting into the into the wits, but the idea is uh that not to think about this at all. Like the idea is your agent when you ask it, hey, can you buy me something online? It will be

like, okay, well, I need I need agent cards and it will be able to automatically discover, hey, there's this technology, lobster cache, and I'll I'll just go and install it. Um, so that's the end goal. Today, you can just go to lobster cache and try to install it. At the same time, this technology is rolling out in beta. So, today we do have a you have to sign in in a form and we need to enable you. So I would want to be mindful of uh of that but yeah like you want to try it just go to lobster cash lobster.cash and uh you can try from there >> and and so you know a lot of people have spoken about stable coins as like the native internet money like machineto-achine payments are going to need to be done via stable coins. When

an agent requests one of these scope cards you know from Mastercard or American Express and it gets that number that card number isn't stable coins. Maybe there's stable coins somewhere in their in the stack. But what's the pros and cons? Why would an agent use stable coins versus use one of these scope cards? Yeah. Um I think two things. Uh first of all, um so when you think of an agentic payment, there's two legs. There's the how does the human fund the agent or delegate the payment to the agent and then finally what what does the agent actually use as an instrument to pay no and so uh it's

important to think about this as you know in a regular payment it's just what do you use to pay here there's how do you delegate and how does the agent actually pay when you start let's start with the last one how does the agent actually pay um what we are seeing right now in this early you know market is that for anything that's microtransactions for tools for LLM usage for paying for its own compute uh the majority of those APIs are being paid today in stable coins and the the bigger the big reason behind it is the is the cost structure uh it's a it's prohibitively expensive today with cards to go and pay one cent

of a dollar a million times you know whereas with a stable coin, you can do that much more, you know, with a much lower cost structure. >> On the other end of the spectrum, if you're trying to buy something on an existing mer against more like e-commerce or travel or things like that, that is where cards are a much better instrument. First of all, because there's uh you know, I think around million merchants out there that already support cards and that they're not going to adopt stable coins tomorrow. But second because you also get uh customer pro like you know you get charge of protection you get points and all those good things that people like about cards.

So things are kind of segmenting in in that way no like service for agent stable coins some service or product for human cards um that's on how the agent pays. Now how do you delegate the payment for the agent is a separate question. Most people out there don't have a stable coin that they will send to the agent. So what we see is cards are the primary method on the on the dele on how does the human give payment to the agent. You can save a card on file and the agent can get a scope card but also the agent can on ramp uh and top up their stable coin balance from the same card on file. No. And this a bit the vision that we've seen and also what the demand we see in the market is

basically human saves a card on file with the agent and then from that save card on file they can both their agent can fund their stable coin balance and the agent can also get scope cards from a single integration and solution and the agent is the one that can figure out the complexity of when do I need a card when I need stable coin. The user shouldn't need to worry about any of that. That's all happening under the hood. >> Yeah. Incredible. Okay. Yeah. So, we're we're starting to see kind of two different payment use cases evolve for these agents. Like you said, some of the these are services, others are um e-commerce. Uh and so we're we're seeing two different payment methods for two different use cases. Um okay. Uh and so, you know, as you're continuing to

develop solutions, you know, a lot of this is agent to agent. Um and now you know you have eight American Express, you have Mastercard with these cards. You know what is the security practice like? because a a lot of this was you know kind of people were very hesitant to start to implement some of these things right even near you know kind of talked about how there's open claw vulnerabilities right it can just start doing things I remember there was you know when openclaw was at its like peak it was like going and deleting emails because it had access to gmail once it starts having access to money even if it's capped you know these things can run pretty pretty wild And so maybe this is

where verifiable intent comes into play, but generally h how does the security of these things work and and how do we make sure that uh that these agents are spending money securely? They're not going to get, you know, that card number is not going to get stolen. Stable coins are not at risk generally, what are what is the financial security of these of these agents? >> Yeah, that's a good question. And so I think this is precisely what separates the uh these new standards that are coming online like master our agent pay and and and the others from like just giving an agent a raw card. Um I will start with we have seen across the industry already a lot of hacks on in the developers giving their

open claw a raw credit card number or a private key for a stable wallet and it it getting like um stolen by promp injection or a malicious scale. So that's definitely is a a very real threat. it's already occurred and so yeah a lot of behind these technologies is how do you prevent that? So with with the scope cards from Mastercard, Visa, Anamx, etc. Um uh first of all what you do is you you minimize the blast radius like the worst that can happen is you lose a 100 bucks but also there's going to be enforcement of you know at the merchant level like this card is only allowed for this kind of merchants or intent. So if you create

a car that's for travel and someone were to steal it, like worst case scenario, they can buy maybe a hotel somewhere but not like take the money and launder it that easily. So it reduces the the potential. It makes uh you know compromising this information much less attractive. That's on the card side and and also the card number is it's a virtual card number. So it's not the raw card number. So if you revoked it um it cannot be used again. No. And so with our solution and if you try in lobster cache, you can also revoke the cards, you can set expiration times and all of those things to really like not prevent the problem but make it so that if it happen like it won't be a big deal and the attacker probably won't even even target it

because they cannot do much with it. On the stable coin side uh similar the solution that we propose we we also include wallets as part of the solution and we do two things. want the private keys of the wallets. We never store them on disk. There's other solutions out there that store them on disk encrypted, but then they put the key there as well. We put it on the we always use the secure enclave on the device, the keychain on iOS and things like this to make sure those keys are not extractable. So if you get compromised or you get a supply chain attack like the one that happened like a couple weeks ago with Axio and Lite LLM, the keys will never get stolen. And then the other part is on the on the crypto side, we also have the same like spend limits

so that you can say, "Hey, this agent can only spend 100 bucks per week." And so worst case scenario, if someone stole your computer and had your password and could uh or or can trick the agent into buying things that they shouldn't, they can only be able to spend up to the spend amount. No. So the idea here is restricting the damage er uh containing damage so that the attacks are less interesting to do and have lower blast radius. Um but I would also admit that in general agent security is a work in progress. So this is the best thing you can do. You can limit the scope a lot to the point that I think is more than usable for most use cases. Um but [clears throat] but there's also other

things happening on agentic security uh across the industry that that will also uh you know make this make all of this like uh like >> yeah it you know it seems like especially with this integration the the payment systems for agents are radically innovative now the agents themselves we we kind of had this initial iteration but with the security vulnerabilities and then also with you know kind of the the way that uh these things have been continuing to develop. It feels like now they're lagging behind. Like what what are some of the more creative things that you think we can do? You know, are are are these agents are they ready to, you know, book ourselves flights, book

us hotels? Like are they ready to do these sorts of things or is it is it just not quite maybe they have the payment for it yet, but you know, for some other reason they're not able to do it. what what is the biggest blocker to really making these agents very useful on a day-to-day basis? [clears throat] >> Yeah. Uh that's a good question. So there's a few things. First, I'm going to be very clear that on the payment side, I think these are the right technologies. Uh but they're starting to roll out. Um today, both Visa and Mastercard's solution are in beta. like you can you can start trying these things in lobster cache with us and but almost nowhere else on

the entire internet and so as these technologies roll out there are maybe card issuers that don't support them yet uh like Chase I believe and others so there's there's still some time for the payment to be at a state where we're like okay like everyone can use this no I think today basically I would say is for the next three months it's only people who are who are joining betas and things like this but the second part is is actually when agents go to pay. There's not much inventory of things that that works. You can go and open a browser and try to buy on a on any existing e-commerce website, but that doesn't work that great yet. And the main reason is there's a lot of um captas

there's a lot of like anti- fraud technology that has been deployed to prevent automated abuse that is now blocking automated legitimate cases. So there is technologies and efforts to fix that but that's lagging behind. So what you will see is your agent will get blocked in a bunch of places like uh you know Amazon for example blocks all agents no or things like that and on the stable coin side um there are more and more services coming online. Uh in particular crossmate we have an API that has more than a billion physical items that you could buy directly with stable coins. There's also for X42, you know, hundreds of APIs that you can pay with, but it's still a minuscule amount of, you know, the tools that an agent may need out there. So, I would say inventory is still small. At the same

time, I do think this is a very outsized opportunity for for folks to start building apps or uh or services natively for agents that that have great agent conversion. uh because the moment the payment methods are are you know fully rolled out which is imminent maybe like end of Q2 or whatn not uh there's just not that many competing for their dollars. So you know I I think the market will correct itself but right now there's a bit of payment methods still get into production readiness and then inventory uh being uh readily available that that are both improving but but are still not at the critical like uh point I would say.

>> Yeah, you know I saw chatbt 5.5 came out yesterday. I started to play around with it a little bit and it was able to schedule appointments on my calendar which felt like a new thing, right? It wasn't just an LLM. It was able to do some take some agentic in you know agentic actions. Um you had to connect the apps first. It couldn't just go out and use the browser, right? What what what is your current stack like? What is what is your agentic stack looking like these days?

>> Man, that changes uh by the day literally. >> Yeah. >> Um uh I'm a user of a lot of agents. I like uh for more personal use uh more manage agents. I use tasklet. I don't know if you guys have tried it. Uh but very very easy to use. Uh for agents that spin off of my own inbox. I also use Zo computer for things that are a bit more more advanced. It's a bit like a open claw that requires a bit less maintenance. Then I have my own Mac Mini with open claw that has a bit more like heavy is running a lot of things all all the time. Um and then I personally use Devon a lot not only at the company but Devon from cognition but [snorts] also I have my own Devon personal instance for a

year and a half and he's the one that writes code for the other agents. Um and then in terms of APIs and u more lower level I've been playing a lot with agent SDK from open AAI um and uh starting to look into run loop for secure sandboxes. >> Um so I don't know but but you ask me next week and I'll tell you three other tools. The reality is changing all the time. >> Um but but uh it's a it's but it's very cool to see the progress like basically one thing that was impossible a month ago suddenly now is like super easy this month.

>> It's very cool. Uh Alfonso, thanks for thanks for coming on the show, man. And uh you know, obviously uh very very uh cool to hear about the AI stack and there's things coming out. It's always it's always good to update the mental model, update, you know, what the stack is. And then also congratulations uh on on the partnership with Mastercard and American Express. Uh feels like payments is just one step closer to becoming actually useful in the real world. >> Absolutely. Thank you so much for having me. Um, and uh, yeah, uh, hope you all have a hope the audience uh, enjoyed it and hope you all have a a great weekend.

>> Absolutely, man. Thanks so much. We'll see you next time. >> Cool. All right, guys. Uh, that is AI Supercycle episode 30 presented by Near. Been doing this for over six months now. We're not stopping anytime soon. AI Super Cycle just continues to plow ahead. We're going to take a quick standby break while the lads in the tokenization tower get set up. Uh don't go anywhere. We are going to be right back with Dino and hearing about the new Fluent mainet and Blend TGE.

Somebody woke Andy up from his nap. So we're we're going to kick it over to those guys in the tower. Don't go anywhere, guys. We'll be we'll be right back. [music] >> [music] [music] [music] [music]

>> Money power. [music] >> [music] >> We get deep. We get [music] deep. We get deep. We get deep. [music] We get deep. We get deep.

We get We get deep. We get deep. We get [music] We get deep. You know we get [music] [music] we get deep. We get deep. You know we get deep. [music] We get deep. We get deep. You know we get deep. [music] We get deep. We get deep, you know.

[music] We get deep. [music] [music] [music] Going

70 7th floor. Ladies and gentlemen, we are in the tokenization tower. Dino, welcome to the Nest Man mainet day, my guy. >> How are you feeling? >> Great to be here, man. Every time I I see you, you guys have gone up another floor. >> I appreciate it, man. Congrats on the launch. Huge day. A a lot of effort, a lot of work has gone into this, you know, from the team side, from the product side, from the chain, the applications. Just give us a sense of h how you feel right now, man. I mean, it's been busy.

>> Tired. [laughter] >> It's been a lot, honestly. Um I've been excited. Like excited. Also jacked up, right? Like I mean, it's it's been a lot. Like you said, we launched both mainet and TG today. Y >> um and both of those things are two like independent and like very intense work streams and um it was definitely like a lot of work especially building up to it, right? Not to mention just like the past three years of of building this thing. >> Yeah. >> Um but it feels good. But it feels good. Few sleepless nights are are well worth a you know a nice a nice launch. I mean mainet's smooth like it's it's good.

Like so we're we're um >> now it's just fullcourt press towards like apps getting more of them live. some of them are right now but making sure the rest get onboarded and then obviously like growing the the set of apps in the ecosystem and helping them helping them grow. >> Yeah. So overall, you know, a lot of work from the team. It's kind of the end of the beginning era almost now. >> It's kind of funny because you do all this stuff and then it's like it is the it's like a finish line but then also the start of another start another race. So, >> it's it's this funny like dynamic where you're like you're like kind of like relieved and you're like, "Yo, we did it. Like, we pulled it off. We shipped a real thing that people can use and transact on and all this stuff."

>> Um, but then you're like, "All right, next chapter." >> Yeah. Yeah. Yeah. Definitely. It's like a It's a milestone in of itself and it's it's the >> No, we feel good. We feel good. >> It's the beginning of the end or it's the end of the beginning. Sorry. >> Oh, boy. >> Um, so Mnet is live. Um, talk to us about kind of what that ecosystem looks like right now on chain. What is the mainet ecosystem application side? I'm a user. I, you know, got the blend airdrop. I want to participate. What can I do on chain now? How do you think about that kind of landscape? >> Yeah. So, just to start with like how we thought about the ecosystem building up to this point, right? Like there's a lot of chains. Like there's so many damn chains.

>> Yeah. >> Right. And everyone's gotten like fatigued by it. So, it's like even as we were building this thing over the years, like we had it top of mind that you have to just do different things to stand out. Like otherwise, you're just going to like fall right into the saturated market and nothing's going to be any, you know, any different. And so, like we, you know, maybe a year year and a half ago, we were like, you know what, screw screw the old playbook of just trying to get like a ton of apps on mainet almost as like a near vanity metric. And so, we decided, let's be like really opinionated. let's think about what our tech is really good for, what um types of builders we want to empower and like that can span like you know uh more culturally like you know

what what types of people like obviously we we're definitely very biased towards um you know I'll say like crypto like adjacent type founders who can kind of like straddle the line like maybe they're targeting some like less cryptonative end users but they still kind of have the cryptonative gene. So like there there's like a persona that we generally optimize for of course like we want someone who's like good faith and and all that but then um you know if they have like some kind of superpower whe that's like an industry superpower like they know this vertical better than anybody else. We have a few examples of those or just like a technical superpower. They're so damn good at this one thing. Sure. Um, so anyway, we like we basically crafted this like user persona or kind of setup user personas and we're like, "All right, well, we're

gonna fail if we don't like hyper hyperfocus on this like curated high quality ecosystem." So that's what we've done. And so we've spent the past, you know, 6 to 12 months after we've gotten kind of like a cohort of of eight apps now at like at launch um just helping them like build and giving feedback and and iterate and making sure their you know product and growth strategies are prepared for for launch. So feel good there. We have a core base. >> Good. Yeah. >> And um and now I mean we we we have another cohort that we're you know gearing up to to introduce and of course like help them kind of get off the ground, get feedback and and launch for real.

>> Um so feel pretty good. And on mainet today, yeah, actually if anybody's listening to this and wants to check it out, it should be pretty easy to find on our on our X. You could just see kind of a list of like which apps are are available today. We have some DeFi stuff, some consumer stuff. >> Um and uh yeah, pretty pretty excited. >> Nice. So uh the kind of way that this space has started to progress and you've kind of built through multiple cycles here of like uh you know technical specs of narratives of sentiment. You've seen a lot and really the point where we're at now is very much like um there's kind of like this two path world where a lot of the kind of like older guard L1's L2s chains they are very much like

institutional >> tokenized assets. we need to go get, you know, these players on on our chain, building on our chain. And then it's like, well, there's these other people that are like, no, no, we just want to focus purely on onchain consumer retail. We we want to maximize that market. Um, and we don't really care about like the institutional flows or whoever. And so, it's kind of like I'm thinking about it in these kind of two ways. Where does Fluent sit? Is is there a way that you think about how in the chain landscape what differentiates Fluent and kind of how you know you think about this like two two path road that that the the industry is kind of like seemingly growing into.

>> I'm glad you framed it that way because I do exactly think of it the same in these two general paths. I mean there's nuance but these like general paths that either you're going like you're trying to plug into fintech or like or um you're trying to enable more consumerry looking stuff like just like very very roughly like that that is what's happening you're you're correct >> um and what we observed over the past year are you know one of those things actually started to work which is great the former the the fintech side of it so you do you had this like mass migration from all different types of stuff to everybody fighting over payments and stables and kind plugging into different fintexs and like that's great. If that's your edge, if that's your thing, amazing. And we have some of that going too. But I I actually think what's being

like dramatically undervalued right now. Yeah. Is more of like the net new assets, consumer creator type stuff, right? Like having fun on chain, appealing to a younger generation, like actually revisiting some of the ideas that people have tried. you know, every cycle there's like a wave of ideas that are good ideas, but either bad market timing, bad execution, you know, not so integrity builders. Like there's there's a slew of reasons why things don't work in practice, but that doesn't really mean that like some of the ideas aren't that good. And so we're actually very focused on um on the latter on like on some of the more like consumerlooking um plays and and I feel like you know you can you also learn a lot from the people who come before you. I mean like there's a whole you know trail of of of attempts and mechanics go to market

attempts like all this stuff you you can it's information you can just learn from it and iterate from it and I mean it's just the classic thing that you've probably heard a million times about you know all these ideas that are now that we now have on our phones where like do like that kind of thing right it's true and I don't think it's going to be any different in crypto like a lot of these ideas are just good ideas like they're problems to solve and for whatever reason they don't work until they do and so >> that's to say I I would probably say it's like maybe 7030 like uh towards the more like net new assets and experiments consumer etc. And then of course we do we do have kind of some really good DeFi products. I do think that um they weave

together like if you create like a really focused ecosystem where you've curated builders who are um you know of of a certain type like where they come into the ecosystem with somewhat of a not a social contract but like they they you've kind of validated that they all they they want to work together with the rest of the people in the ecosystem. you can actually then say, "All right, if if all these guys want to kind of work together on um like more consumer experiences or financial experiences, um then you can help steward that." And it's actually pretty it's pretty beautiful. You can kind of work backwards from real problems to solve and then, you know, pick one, two, three, four different apps on your chain >> and work with them. So it like actually all rolls up into like a really nice

experience. So, I think there there's a lot of elements to it, but um I do agree with the two different tracks you mentioned and we have a little bit of both more skewed towards the experimental stuff cuz frankly I think a lot of the vision like the visions behind these things over the cycles from the biggest players to the smallest players >> were were correct >> and we will see in the fullness of time that they were correct. >> Yeah. >> Um but it's it's more of like an execution problem and frankly I think we were pretty well equipped to execute. One of the core tenants that you kind of talk about here as far as ideas was identity and reputation.

>> Yeah. >> Um back in 2017 there was ICOs around this. There was tons of different um new ideas around how to construct an online identity that is private, is verifiable, um and that is bas you know that is on chain. And seemingly it's been a grind to get there and we haven't really really gotten a great like identity reputation layer onchain. It what about Fluent do you think will make it this kind of reputation layer for the onchain economy and like why why is this so important to you?

>> Yeah. So for anybody um just learning about us right so there's there's fluent network like the chain and then there's prince which is like a reputation primitive like kind of a data layer that we built on top like you can roughly think of it as like what Kaido did for attention Prince is going to do for reputation and that's what we're building towards and then um I would also probably unbundle this notion of like uh n identity and reputation primitive right because in in reality when you think of reputation what does that actually mean it's it's just broadly speaking who you trust trust for for what thing, right? As you as you navigate your way through the world.

>> And so you if you unbundle that, it's it's reputation is not just who are you and like good bad. There's a million different contexts to which you can build a reputation. Like do you trust the same person for trading advice as uh to make an omelet or vice versa like no people are like really good at some things and not very good at other things. And so what we're fascinated by and are are really building this prince primitive around is this notion of like contextual reputation. Sure. And so, you know, it could be reputable. You could be like finding all different onchain and so off-chain social metrics to actually capture who are the best predictors of things, build, you know, builders of things, community members, investors, so on and so forth. And so,

we we think that's really where the um the interesting area is to focus on, right? And and actually when people have historically tried this like a lot of the identity reputation stuff when thought of in like a really coarse grain way of like okay who are you how do we verify who you are and uh are you good or bad those are hard problems to solve. We actually have like I think a much more like pragmatic like problem space to solve which is like okay we will integrate whatever the best identity primitives are. We'll integrate whatever the best I'll say like universal reputation primitives are. If something is doing a good job saying good, bad, great, we'll plug it into prints. Um, and really what we're trying to do is capture kind of the longer tale of contextual reputation, which is actually

like much more not only easier to measure and capture, but harder to game, but also kind of more useful as you're navigating the world. I'll give you an example. >> Yeah, context. >> I'll give you an example. So, one example is actually at launch, we have we have a few different apps um that we are um taking some of that data from. So uh for example uh we have this one like atiststation protocol right it's called pulse um and it's basically like you know doing similar the experience is kind of similar to what you would get in a prediction market but you're literally just attesting to things there's no no financial capital at work but is there is effectively your social capital at work saying you know u I'm predicting this this this this this and you might not be earning money but you might if

you're right but you'd be earning reputation and that can kind of be used um you know as part of a building block in other people's products. So for as an example if I'm if I'm using oh and one more thing um so that was like one app but like this reputa the let's call it predictor reputation can kind of be done across many different types of apps right like maybe you know as as we go like we're thinking about looking at different prediction markets plus at stationation protocols you could get per protocols you could basically take like anything that can give like an objective you know measure of like is somebody good at predicting events about the world or not you can take those things, aggregate them together, kind of create some type of scoring system. And like that's kind of hard to game. That's way

harder to game than people like, you know, writing like reviews on each other or like maybe like in the attention metric setting. Um, just like, you know, talking about things on Twitter. Like it's way harder to game if you were like right about everything about basketball in the past month on Poly Market. It's way harder to game than anything >> uh that I just said. And so yeah, just so that was one example. contextual contextual predictual certain whether it's crypto or sports or whatever. And look and and what that turns into is actually a building block for not only um builders to use in their applications, right? Maybe you want to do um some kind of social feed or whatever. By the way, they don't have to

be crypto apps. any type of app who wants to basically like take like the best of some niche and say, "Hey, I want to create a feed around this. I want I want to I want to surface those people in Yelp or whatever." >> Like that's where you'll look. You'll do that on print. You'll do that with Prince. And then, of course, as a user, as just like a regular person in the world, you have a a mechanism to which you can actually verifiably prove that you're reputable in a certain context. So anyway, that was one example, but we see a lot of different >> So you think that enables um Right. So there's like this kind of uh world of unknown. Yeah.

>> That exists on chain, right? And uh enabling known realities or known uh strengths, weaknesses, setups, etc. that allows for a much more I mean you could say a personalized future for these users or um you know you could start to think about like loyalty programs and you start to think about things like under collateralized lending based on these types of things as well. So this like this like black box that we currently have of of this like reputation and like can I trust you bro, trust me, bro on chain with like a primitive to build on top of a single like wallet or a single account uh that that has this information. It provides a whole different like you start to see that it's not just like a little money

game on chain. It's like a whole new kind of uh growing you know people say nation state, right? But it's a it's this it's this new online economy that you can really start to see form. >> Yeah. And it's just really pragmatic, right? Like I mean like people are always if you're applying for a job, what are people trying to do? They're trying to see like what you're what different things you're good at. if you're um anytime of the 3040 billion dollar like brand and influencer marketing industry like what are there some of big some of their biggest problems are like actually cutting through the noise of like who's really good at at what at who's really influential at what who's really you know um >> there's a lot of like cruff like in the middle there when like brands are trying to go through agencies to find like who

are the who are the most reputable people across these different topics like this can help those types of apps and industries as well. So yeah, >> excuse me. I'm glad you mentioned um finance as well because this this also applies there. We talked about the two different paths like um you also mentioned under collateralized lending. I mean that's something that's being built on Fluent right now. Like if we can really get this right across those financial contexts too, right? You can um you can you can do some pretty cool things with people who are more reputable even either in just the good bad sense or um or actually more interestingly at whatever financial context they're in. And we actually have an app um that's live today uh Vina that's integrating Prince. We're working closely with them um to to do to basically uh give better rates to people

for lending and borrowing who are more reputable. And so we're working closely with them to see like okay what are the different things to measure like what really matters that can indicate to you like what's a most reputable lender or borrower and then you guys can can price based on that. >> You know people say that we need like a better UX on chain which is like fair. It's true. I agree. we do need a better like operating UX, but I mean I think a lot of this will be eventually managed by agents in the future or just agentic something. Um, but like what what they really mean by that is like we need the same UX, if you will, that we have in the uh current world. when I go to try to get a lease and I have credit and I have, you know, this statements that are

attached to to my name, I have this, you know, um, you know, these tax um, uh, these tax filings, these, you know, these this information that is connected to my name. Yeah. >> Um, that's like the UX that is like >> partially missing on chain. Um, yeah. >> Yeah. I mean, I I I do think it it it also cuts across agents and humans, right? One thing that nobody's really cracked yet is like a reputation layer that can um can accommodate both in a really seamless way. And like the way we think about it is even in like the like agentic world.

>> Yeah. >> There needs to still be some kind of accountability. I mean there's a lot there's actually a growing discourse around like what does identity and reputation actually like mean in an agentic world. And like honestly we're still figuring that out. But the cool thing is like I do think you will need a kind of unified framework to cross across both of those things in like a seamless way. like we can't just be looking at as like oh we evaluate the humans this way and evaluate the agents this way because in a lot of sense >> in a lot of cases the agents are acting on behalf of the humans. So the line's completely blur like if I create an agent that like runs a muck or I create 30 agents that run a muck and do something bad to you.

>> Yeah. >> What are you going to do there? Is it is it really is it the agent? It doesn't make sense. The agent's fault one instance of the agent. No, it doesn't make sense. So we need to like find way we haven't cracked it yet. like this is something we're really actively thinking about, but it's important like to try to figure out how do you actually hold this world of agents and humans accountable and I do think there's some kind of reputation tether that you need to get get right there. >> Yeah. Interesting. Um, what is the evolution of Prince like? How do we go from idea initial product to more of a like a fullyfledged like layer for for the onchain kind of reputation world? Like what is that process going to look like?

>> Yeah. Uh it's getting really narrow with like what we focus on to make sure we get it right and then you can kind of rinse and repeat across different contexts. Right. So I mentioned the prediction one. We're doing that right now. So that's one that Fluent Labs is actually building right now in partnership with like a few different of the apps on Fluent, right? So that's an example. >> Um the undercolateralized lending bar like that is another example we're actually doing right now. So we're just going to take some problems to solve that we think are important and like preient. >> Um and just really try to get like the mechanics right um and then and then go from there. That's really all you could do. If you try to, you know, bite off too much like it's just not you're going to do a half-ass job at everything. So

we're just trying to get really focused on things that can make an impact like today integrate them into the apps that are building on fluent. I mean this is by the way where those two things coales prints and fluent because we launched fluent the chain right there's a chain and so the >> what are the advantages of of having this layer with apps you know >> well it just it's so like everything from the way we're like designing like the ecosystem to the way that like you know we're we're kind of like structuring like the brand to like the types of um actual like developer tools and stuff like that. It's just like a very seamlessly dove dovetailing between those two things. And so like you know as Prince grows and becomes kind of like the reputation layer for the internet.

>> Um it's it's a very fluent network becomes a very natural home like all all these other types of reputation based apps are there. There's really seamless integrations and then um a lot of this reputation data let's say. Sure. >> Um you might want to you know derive different markets and assets from where you going to do that? You'll do that on Fluent. And so these things really really work together. Um and and by the way, there's also like a nice virtuous cycle between um the other direction. So like you know, let's just say you're an app uh and you integrate Prince for some reason. Well, guess what? Then like the data that your app is natively generating that might not be a reputation signal in Prince yet can then kind of flow back into Prince and be a reputation signal. Other builders can come and use that and build on that. And

so it just like creates this really virtuous loop. And so like the thesis here is that that the um products that you can build on chain with this reputation system in Tact are far superior than without it. >> Absolutely. And new and new types of of products and it actually appeals to um uh non-crypto products, right? like you can actually come and just use the Prince API as a not crypto anything like that could just be like a core reputation thing and effectively a top off of funnel for fluent um by just you know letting non-crypto products build on it because frankly like >> it's it is it is something that nobody's really nailed outside of crypto.

>> Yeah. Yeah. So you know we kind of started off talking about that this was the you know beginning of the next era for Fluent. What is that next era, right? Like now that you're like like where's your just like let's start with your mind. Where's your mind at? Right, with having this behind you, where does your mind currently sit? Like what's going on in your head? >> Um >> other than just making sure every everything goes well for the next 24 hours and doesn't break, you know? >> I mean like definitely that first, but of course we're thinking about longer term. Um after we Yeah, the [laughter] dust has settled. Maybe sleep a couple hours. Like that would be that would be kind of cool.

>> That would be nice, right? Um, but then after after maybe a couple hours of sleep, yeah, back back at it. And uh, what we're thinking about a lot is just is is the is the ecosystem. Like that's it. And that includes prints. >> What does that mean? Like you're thinking about the ecosystem. >> Yeah. No, I'll dig I'll dig into it. So like um that includes print. So it's like okay, we have these like this reputation layer thing. We have like a cohort of apps that are live. We have some cross-section between the two. Some of them are integrating it. So it's like where do we go from here? Um, I think what's extremely important is helping those apps be successful because frankly I think the biggest bottleneck to onboarding more users, builders. Before the show, we were talking about how like the space hasn't really grown. I know

it's a bare market, but that's not the problem. The problem is like there aren't apps that most people give a about. And so like if we can work really closely with the with the Fluent ecosystem like meaning like these this cohort of builders that we've curated and the next one that we haven't really announced yet um then I I I think the goal is to just make make those really really great and make them in a way where um help them appeal to actual target audiences which in a lot of the cases for the Fluent ecosystem is outside of crypto Twitter. So like we just take that on ourselves and say like all right we now work for you apps like we're extensions of your team. How do we help this grow?

>> Yeah. And um yeah, I think that's I think that's the main thing. And then if we can actually crack that frankly as an ecosystem, not even just fluent like build apps that people actually care about, we'll we'll get more builders and we'll get more like this place will grow. >> Yes. >> Um so that that's the next thing. Another thing for like the more sustainability of like the Fluent Foundation and Fluent Network is actually revenue, right? Think about that. So um part one thing I didn't mention is there there is a there there is a uh there is a native stable coin on on onfluent network it's called USDNR yes >> um done in partnership with our friends at Nurona >> um and that is you know that goes to the Fluent Foundation right like what's this Fluent Foundation's meant to steward

like just purely the growth and maintenance decentralization governance of the Fluent network and so that also creates a nice loop because like as the apps integrate the stable coin the yield goes to the fluent foundation. Its sole purpose is to channel that back into helping the apps in the ecosystem grow. So that creates another loop as well and and so [clears throat] both those things enable the apps and that actually kind of pulls revenue along with it that sustains the network. >> So interesting example of something that's doing or a chain that's doing a different route uh rise this um kind of like high throughput gigas branded blockchain. They've they got I they I think they acquired a perplex and then now they're literally just going all in on building one per deck on the chain. I think it was like starting more like of

a general purpose kind of chain. Uh and then now it's firmly like uh we're just literally trying to get this per thing right. Um obviously going to compete with Hyperlid there and lighter and these big names. Like when it comes to building this ecosystem, you talk a lot about building this ecosystem. How do you do it in a way that is not cannibalizing the existing builders? Like say you have a really damn good idea or you want to fund an application internally from the Fluent Foundation. What could that look like? How do you think about building like a more like mutualistic environment for your for your founders that are building in your uh chain and in your ecosystem in addition to like also think about verticalization being like hey like I think this sector is going to do well. I

want to be the the team that builds it out. you know, this product line is going to make x amount of dollars if we do it right, so we should do it and we should own that. How do you think about that? >> Yeah. So, we've been thinking about that a lot. Yeah, we've been thinking about that a ton >> and um I I think there's there's a few different ways to like skin it because like at the core it's like you need products that people care about to generate revenue to um like make the thing sustainable whether you're building an app, a chain, doesn't really matter. Um, and so yeah, there different ways to do that and I I I think the one that I just mentioned hap is one of them. Like, okay, can we actually curate really great apps? Can those apps

integrate the stablecoin thing? Can that fuel the growth of the fluent network and sustain it? That's one path and that's the one that we're doing right now. >> But of course, with the advent of of like AI tools getting so good, frankly, it's like pretty easy to like spin up interesting ideas. And the bottleneck is actually like which ideas should you spin up? like we are gaining a ton of knowledge about problems to solve at the app layer. So like not making any promises but like we have our eyes on it. We're like hey look if there's if there are certain problems to solve that like we're best suited for for whatever reason like yeah Fluent Labs team will will will whip that up and and frankly like I think that the the speed to which you could do it and like that you have

to iterate through different ideas is is increasing so fast that like you can you can go from idea to knowing whether or not it's worth continuing pretty quickly. >> Yeah. So yeah, it's on our radar. >> What um what was the hardest thing about launching mainet? What was the most challenging or the most Yeah. What was the most challenging thing about launching this blockchain? >> There's just so many Well, here I I got to give I give my boy and co-founder Dimmitri, the gigab brain behind Fluent, uh some credit. The hardest part was definitely building this core thing obviously because that's what took us like a couple years and um and uh it it is it is pretty innovative like I mean like we do we do have this like type of environment that um we'll get too into

it because I know most people don't really want to talk about infra stuff right now that's cool but like you know it you can run SVM EVM and WASM based apps on one place and that was like >> really hard and uh and so to actually to build and so the actual answer to your question is like That's probably the hardest thing. But like in the in the recent months, like as we we have a product, it's like okay, like you're trying to operationalize it. What's the hardest? I would probably say just aligning so many things together to like work on the same day. Like there's so many different parties involved, right? So there's like the core like Fluent Labs team. There's like this new foundation and that kind of like splitting. That's a new kind of collaboration. There's um the infrastructure providers at like the app

level, at the chain level, all the apps. And then of course like TGE happened as well. We wanted to make sure that like those went on on the same day. That's like a whole another beast of coordination just to make sure all of that aligned. Yeah. Yeah. Yeah. Yeah. We're actually going to launch it yesterday and we we only delayed one day which was nice but like man it's hard >> still. Yeah. Okay. Interesting. And and what was um what was easier than you expected? >> It's a good question. Um >> or what was enjoyably easy that you may have thought would have been a pain in the ass? I would say that's a really good question. What was was enjoyably easy. It's funny because like there are so many things that end up being easier than you think, but like the second they are, you're like, "What's the next

biggest fire?" And like your mind maybe you got to ask me that. Uh I'll think about it over the weekend and get back to you on Monday when the dust settles. >> Yeah. We will have time to like think back and be like, "It's actually not too bad." >> Yeah. Any advice that you'd give to other um teams launching in this market, right? whether it be working with exchanges and I know that that they they can be very aggressive with their terms and listings or if it's market makers or if it's >> uh uh vesting schedules, token allocations like this market's different, right?

It's a different market. Just thoughts on how you guys executed there and what you know >> the simplest way I could put it and the most high impact way is to just say like whatever you happen to be doing just be transparent about it. Like I do think the industry is generally shifting towards more transparency. You see a lot of this more like investor relations type vibe like you know people have like way way way more sensitivity to any kind of like shady games and stuff because people have been burned so much in the past. Like I get like they as they should be sensitive to it. Good. And and and the reality is like you know all projects are are going to be different.

Like I I'm I can't sit here and be like, "Oh, you should um you should not not raise or raise or like there's all these discussions on the outside, but at the end of the day, like different different strokes for different folks, but what's most important and the highest impact thing is just like first off operate in good faith. Maybe that's like let's take that for granted, but just be transparent about it." Like even even with like our ICO that we did. >> Yeah. >> Um that was that was learning from something we tried before that that didn't work. And like we we operate in good faith like I mean I like you know but but even then you're like you're getting new people who are like very sensitive to you know from their past experiences. And if you don't if you're not as like transparent as you like

should be with the mechanics of something whatever >> people are going to assume the worst. So like the best thing you could do is just be really clear and do be really like simple about it and uh and and be transparent. Just like say things that you're going to do and then just do them. That's it. Yeah. >> Um, and I think that like it could take many different configurations like frankly like you know this amount to uh like the different like tokconomics, the market makers, the this amount at launch like none of that stuff really matters as much as like >> can people trust you. >> Yeah. And you guys had this whole like PDF transparency report and you know disclosure. We our investors influent here and you guys had this whole PDF thing that had like all the tokconomics and all of the uh you know you entity

details and like your name and all this stuff, right? It was like very very out there. >> Yeah. Yeah. And we Yeah, we did that. So we have uh you can you can see it online. It's published on the Fluent site. We mentioned it in one of our a few of our tweets. Um it's this uh disclosures doc that like 24 pages as you said walks everything uh walks through everything from the product to the project to the even like risk the tokconomics the specific market making arrangements actually it's funny there was a somebody did a report blanking on the name of 150 plus projects we weren't fluent was not on it but if we were we would have been one out of two projects that actually disclosed information about like the market makers that they and we would have been the only chain.

>> Wow. >> Which is crazy. And so um and not not this isn't patel in the back. Like I think everyone should just do this. >> Um and and and the amount of like you know just just show people that you're trustworthy. Like it's like not that hard if you are. You just say things that you're doing and then you do them. Um and then for >> what's it called? Yeah. The the um I was going to say something about else about transparency. >> The launch transparency advice. >> Oh yeah. Yeah. Sorry. the the thing that we learned um we tried something and we we tried this like NFT sale thing a while back sure >> and we thought it was great right like it's a classic like you everyone has a plan till it gets punched in the face like we thought it was great we're like

this is so on brand we love these are really cool mechanics some nice like art >> and then what did the market want clarity and you're like oh okay you know what and so we learn we we iterated on that even for the ICO and said like you know what this is we're going to make like >> our our our feedback was like bullish unfluent >> need to be >> like this is this is too complicated. And so we're like okay well we're going to do an ICO. We want to get more of like the public involved in this thing before launch. Um let's make it as simple as humanly possible. And that's and that's honestly like that's it did work thankfully. I'm like grateful and relieved at that.

>> Um but it I don't think it would have sort of shot if we were ambiguous. >> Yeah. If you like the the market is not reacting well to vague behaviors at all. >> Like that game's over. Yeah. Like it's just you got to like just build real things and you know build trust. >> Yeah. Well, Dino, congrats, man. Uh it's been a long what has it been? Four years of building this three, but still >> three years >> since that is much longer than most um token projects, if you will, blockchains uh take to launch and a lot of people take shortcuts. You guys built real real tech, innovative ideas on chain. Um and now you get to kind of go into the next battle, man. So, I I wish you the best of luck. It's going to be fun. Um, it's

going to be even more challenging than launching the thing, right? Is is is hitting product market fit, scaling it, all of that. >> Now, the fun begins. Yeah. >> And next time I come back, you guys will be on the on the roof. [laughter] >> Ladies and gentlemen, that is Dino. Let's give some love to Fluent, man. They just launched their mainet, guys. We'll be right back with our next guest here in the tokenization [music] tower. Uh, happy Friday. Thanks, Dino. >> Thanks, man. >> Cheers. Heat. Heat. [music] [music] [music]

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70. Welcome back to the rollup, ladies and gentlemen. We have Melody Heath, the deputy CEO of CESOP Asset Management and none other than Teddy himself back from a road trip. Guys, welcome back to the nest. Well, welcome to the tokenization tower for your first time. >> Thank you for inviting. >> Thank you for being here. >> Thanks for having us, man. I'm finally home.

>> Yeah, you're back. [laughter] >> Yeah, I'm back. I'm back. >> You're so back. Um, well, great to be here, guys. I know that you guys have been working closely together ideulating uh all different types of of RWA's onchain just this kind of just this broad what we're calling a convergence. It's this convergence between uh the onchain asset class and the traditional finance asset class. We'll get into that. I'd love to hear a bit more of of your background kind of how you got into this role uh what you do and and kind of how you're thinking about this convergence as well. Melody, thanks for being here.

>> Yeah, sure. Um, so I actually started my career in Goldman Sachs. Um, and CSOP is actually one of my clients. So I moved to CSOP in 2012. So it's a while back. >> Um, now I head up um, a few functions. So I look after business development, IT as well as trading. Um, I think for CSOP, um, currently we're the largest ETF manager uh, in Hong Kong. Um, assets under management about 36 billion US currently. Um and the product type I think spans from um like very traditional type of ETF uh like broad-based indices um like you know including like Hong Kong China names um including Asian including US to um the more uh I think alternative style like

we have reads we have uh very interestingly like leverage and inverse products. So that's something that is actually quite popular now uh in the Hong Kong market. So lever inverse indices as well as lever inverse single stock uh products. So for example this year I think what has been really popular is because of the me like the whole memory super cycle. So we've seen a lot of inflows into some of our like memory related Korean names like SK high. Yeah. So it's um you know we have uh I think more than 60 uh products out there. Um many of it is uh Asiaentric though we do have like US underlyings, commodities and other asset classes as well.

>> Awesome. Yeah, I um I had a a great guest on this week talking about the emerging emerging markets thesis generally how we're doing a lot of this um bringing all different types of US assets on chain specifically um but not thinking so much about trying to bring other types of asset classes globally on chain for US investors or or other investors to get access to. And I think this is like a a growing trend that we'll see. You know, I'm curious kind of how you're thinking about this Asian emerging market. um you know just from a pure like stock or uh ETF perspective the emerging the EM is pushing through to all-time highs uh I think it broke out of a 20-year range so clearly investors are thinking more about

emerging markets how are you thinking about this in Asia and and and then Teddy on on your side curious how you see this developing from more of the kind of cryptonative side >> yeah so I think um the market has been always looking for like US plus one in the past especially two years um geopolitical ally side um there has been a push um for this right um there's a lot of uh I think concerns and then also worries about the market in general and then there's a need for diversification although of course diversification has always been very very um important but I think because US assets has performed so well and um you know there's just a lot of focus um actually internationally just on US equities fixed income so for example even in Asia markets right if

you look at uh some of the domestic markets like Hong Kong or or Korea or Japan. I mean majority of the investments um sure there is a local component but majority of the investment or or um like a lot is into the US right so that has been a trend that has been um just going on for the you know the past decade or so um but I think you know as geopolitical things change and then also there's um you know just more need for diversification and obviously performance is very important as well right so if you look at last year performers of performance for example top performing is is uh China is uh Korea right this year Japan's doing well um so you know some of these returns

beat NASDAQ right so people are looking for uh alternatives as well so yeah so I think there is a trend for for emerging market so in the past I think when people think about like em emerging market it's more a risk on uh type of investment so for example if everything is going well and there's a very strong need to risk on then people invest into emerging market but perhaps right Now it's it's not the case anymore, right? Because maybe we're not we're not risk on at the moment, but still because there is risk. So there are needs for diversific diversification. So I think that mentality um and also um like the nature of investment has indeed has changed. But with that being said, I think there are still a lot of hurdles

into um you know investing into these markets because um investors are not familiar with the currencies uh how to hedge these currencies. A lot of these markets are ID markets. So, uh, and there are tax implications. So, I think all of these would actually may, uh, hinder, you know, investments, uh, into these markets. >> Yeah. No, I I think Melody brings up, you know, pretty good points, at least from what we're seeing from more of the cryptonative side, is that a lot of these onchain allocators right now, whether they're retail or LPS, they're looking for around, you know, the risk-free rate plus like 100 bips or so.

But if you look at the opportunities in Asia like Melody mentioned like in China and Korea and in the emerging market sector uh I think like institutional grid uh you know bond type products are around like the risky rate US plus like 200 it's around like 5%age um 5% or so or higher. So you know I think as credit opportunities kind of come to play more so in Asia and like default rates are are lower and um you know basically the entire landscape shifts more towards these branded typed assets. I think players like, you know, CEO really stand out because of their huge presence in the actual trady world. You know, a lot of the players we're speaking with now with everything that's going on in DeFi, there's definitely a flight to safety.

So, what we're seeing is, you know, with a lot of our Asia partners, especially with uh you know, CEO, um if they're able to bring on and they and they are bringing on like these very institutional grade types of products, whether ETFs, treasuries, equities, whatever it is, um there is definitely demand for that onchain now. >> Yeah. Yeah. Yeah, I'm curious on your side, Melody, then kind of on that point, how you are thinking about what the advantages really are to bringing your, you know, your asset management business on chain, right? Is it simply just more global exposure? Is it a distribution play? Are you guys, you know, looking at more of like an arbitrage opportunity across price uh prices of, you know, gold or um oil, etc. onchain versus offchain? How are

you thinking about like your strategy holistically here as it pertains to kind of what Ted is saying here now also with some of the elevated risks that we've seen in DeFi as of late potentially being an obstacle curious how your strategy holistically looks and then you know more specifically how you're thinking about that problem as well. >> Sure. Um yeah so I think the distribution landscape definitely is a important part of it but I think more or so the the more important part is actually the ecosystem buildup of everything. So um you know for for example I think in the Hong Kong market um recently it has announced like two stable coin issuers and uh in the Hong Kong market it's a very permission market. So um you know there are uh for example uh approved uh VATPS right uh like uh virtual asset trading platforms

that allow retail investors to trade on right so um when you bring like assets on chain right whether it's ETF or funds or or whatnot um actually it makes it available for these clients to trade now uh internationally right I think there are different uh jurisdictions and different regulatory frameworks that um you have to go through but I think in general right across the board I think there are more adop adoption um both from I think the cryptonative or web 3 uh native clients to even uh just kind of like the web two clients like um who are looking at more onchain because of efficiency. So I think that ecosystem part is um something that is important because you know we are an ETF player we know how important it is for efficiency for

liquidity right like uh you know like 12 years ago or 15 years ago right when we uh started our business in Hong Kong I mean there was a lot of doubts about ETFs that has already been very popular in North America but uh in Hong Kong market or in you know greater China region there has been doubts right because you know it it was a huge push for like active management it was a huge push for like mutual funds. Uh we really believed in uh ETFs because you know we see it as a wrapper or a vehicle that is very efficient right so I think back then we weren't thinking about okay is passive returns really going to beat active returns right it's not just that perspective it's the vehicle itself it you know there's a transparency in terms of pricing um it trades on the secondary

market there's two layers of liquidity it's the secondary market liquidity and the primary market liquidity so I think now uh looking at that right like nowadays is um like ETFs is no longer passive, right? There are single stocks ETFs, there are leverage ETFs, there are alternative ETFs, there are active managed ETFs. So again, ETF is a rapper. Now, I think looking at onchain like tokenization, RWA, I think again it it it's probably another like wrapper that is potentially even more efficient uh or equally efficient than let's say ETS, right? Because it offers 24 potential 247 trading. Of course, there are a lot of hurdles currently still with pricing because a lot of these underlying assets are still priced in Tati, right? So,

banking hours. So, then like on Saturday, Sundays, how do you price an equity, right? RWA. I think that there are still questions and issues to be solved. But, you know, we had similar issues um or questions uh on ETFs in the past as well, right? Like when people talk about active ETF, it's like how do you price active ETFs? How do you market make active ETFs? you know when your underlying uh composition always changes and is dependent on you know the portfolio manager to adjust the positions like how do you value it or like alternative ETFs PE ETFs how do you actually make valuation but I think once you pass that stage of um a lot of these questions then you know the ecosystem uh potentially for onchain is you know a

lot greater right just instantaneous settlement uh a lot of those can be solved um I think what you mentioned on you know defy space collateral is very important in PFI space because of um I think the blockage of intermediaries and a lot of additional layers for banks for settlement for brokers for clients um actually like moving around collaterals um getting the most return um out of your you know equities fixed income holding actually is very difficult especially for individuals right so for institution it's it's easier you have your prime broker your custodian who because you give them a big business they focus on you but for individuals is very hard but I think a lot of this can be solved on chain right so which is why

I think um you know the potential RWA rapper if you look at it as a rapper uh could be very efficient and I think at the end of the day if it's efficient it creates value that's what the client cares about >> yeah honestly Melia hit a pretty good point there I think you know the advantages of bringing these assets onchain especially like what we're doing the plume ecosystem right now is really going to make um you know the next few months very very important for onchain users especially with you know the shift to safety that we're seeing you know at Plume you know our vault and our chain you know we run AML at the sequencer level we have freeze and seize capabilities whit listing blacklisting on our nest vaults when you couple that with the different liquidity opportunities you can build on chain

such as like instant redemptions like Melody mentioned you know we're building a few products inhouse to allow us to instantly redeem different uh types of asset classes you know um using um different RW assets as collateral to borrow against uh for looping or whatever um I guess use cases folks want to do these opportunities you know in the real world they are pretty hard to access um for you know some traditional players so for them to bring this um you know opportunity on chain actually creates a huge flywheel especially for the folks uh that are sitting with a bunch of stable coins at home whether it's like in Asia or in the US you know they actually don't have opportunities like this even in the US like if you're trying to buy um like private credit opportunities for example you need to be

like a high net worth individual you you know, envo with like Morgan Stanley getting their private wealth arm. But, you know, what we want to do with this CSOP team is essentially build like an onchain private wealth management arm, right? Where we can bring everything onchain and then once everything's on chain, we have the different opportunities that Melody mentioned on the liquidity side on, you know, on the DeFi lending side that really opens up the world to basically everything that's, you know, Tradify, but replicating that onchain. >> Yeah. Yeah. on that point. Um the there's been a couple folks who who've came on the show and you know expressed that they actually believe that the next iteration of ETFs are what are you know currently called vaults in the onchain landscape saying that what ETFs kind of did to mutual funds vaults will likely

do to ETFs and and kind of you've been talking about this rapper and Teddy you're kind of talking about this private wealth uh wealth management arm all on chain. I'm curious, Melody, how you think about the evolution as a large asset manager into a like a vault-like product, something like Plume's Nest, other products. How do you think about, you know, allocating to these? How do you think about the value proposition of a onchain asset management vault type product comparatively uh in the sense of like it being a a wrapper as you described?

>> Yeah, sure. Um so I think the you the terminology for a rapper is a generic terms on just um kind of a bunch of underlinings and you wrap it and you put it on chain. But of course you know I think currently um we're still at like very initial stage when you think about putting uh like um assets on chain you need to go through like several stages of for example uh for example you maybe you uh in Hong Kong uh we issue something called like a tokenized share class. So you basically kind of you for an ETF you open up another share class unlisted that's specifically for tokenization. Um so you know from a onchain offchain ledger it gets matched right so I think you know that's you

know one method of course there are other methods for example maybe you use another um like fund or a trust vehicle and or a brokerage account right you buy into the underlying and you hold it and you tokenize that portion. So of course there are these different methods of actually bringing assets on chain. Um and then you know in the US we see that um there are a lot of developments and discussions around for example on like DTCC right or on the clearing kind of settlement front you directly take that shared depository and then do tokenization as well. And of of course I think ultimately what would be interesting right like you what you could describe on a vote setting or on on chain would be then actually um you know purely uh issuing it from an

onchain perspective from a digital native kind of perspective but I think that also requires like a lot of things to come into play. So for example, okay, if I want to hold a basket of stocks, right, like Korean names, Japan names, you know, um, and put it together, right? Like are there actually already tokens of that available as underlying assets on chain? And if so, then I can simply just, you know, put it together in a portfolio for people to trade, right? If not then maybe you need to go through like other vehicles and ways to manufacture the product to put it on chain which uh you know you can argue that it it may still create additional layers and may not be purely you know digital native right but I think

ultimately um it like from a client perspective um you know from a retail or institutional perspective it's looking at the value that's created and if there are efficiencies So it actually doesn't matter what the layering is or what how you wrap it but ultimately is it cheaper is it easier to use uh does it make sense right and if the answer is yes then that way will work right um no matter how complicated the structure is um if it makes sense then people will use it so I think in the trafi world you you see um you know iterations of this as well right so for example you have like mutual funds you have like swaps right you have notes notes, you have um

OTC options, you have listed options, you have all these different um kind of ways to um get exposure to an underlying asset. But you know there are for example like we talked about you talked about private banks, right? So private banks they like to distribute OTC options maybe because of incentives or because maybe their clients are more familiar with the structure or um there's more flexibility in um you know different ways of striking the underlying asset, right? Um, so does that mean it's a more efficient structure? No. But maybe it's because it creates value for the client. So that's why it's used like OTC derivatives. But you can say, oh, but OTC is less transparent, right? So why why why don't they these clients trade listed

derivatives? Um, then I think it's about okay, do they understand how to trade it? Do they have an account to trade it? Can their relationship managers, the sales to help them to trade? Or maybe OTC is easier because you talk to them, they buy it, and that's it. It sits on their account. So sometimes a lot of it has to do with uh at the end of the day what the clients are looking for, what the demand is and um how to actually uh put that on chain. >> Yeah. So you would say like you have a pretty openminded perspective on what ways tokenization can improve your business or this you know these general flows. It's definitely not a one-sizefits-all, but where there's direct value uh improvement to a given product or to a process, that's really where you guys are focused because I

think there's a there's a push back, right? It's like we're going to tokenize these assets, but why and for what? Yeah. >> Um like what's okay, now great, they're on a blockchain. Awesome. Right. So I think like that's something that people push back on and I think it's important to have like a very clear uh productdriven thesis around why you guys are you know going out of your way to embark on this kind of newer digital first world right >> yeah and I think um actually the structure is very important I know for RWA it's growing it's still small compared to um trafi assets obviously um and I think there's a lot of people who have tried different ways for example there's a lot of money market funds out there or tokenized deposits, tokenized uh money market funds, tokenized

treasuries out there and people have tried to use it in different ways like collateral right people try to use it uh like uh for example looping right um you know some found that there are issues with these uh product natures uh some found that there are advantages of these product natures right so um you know I think that structuring is very very important like constant nav right like corporate actions like things like we can like extract appolation of um you know the net asset value on the weekend so market makers then can trade you know these kind of things like I think it all comes together to like like precisely what you said it's not just about putting something on chain and people will buy it it's actually if you put it on chain does it make sense for people to buy it right I think ultimately that

is the question that um I think asset managers like ourselves need to answer and think about >> yeah that's also been our thesis from the start like I think tokenization of like different assets is becoming commoditized you know when I was uh working at LA before starting Plume I saw a lot of folks bringing anything on chain but the question is like what are they going to do with these assets who's actually buying these assets right so I think what Melody is saying makes a lot of sense because when you start from the demand side really understand the buyer base whether they're more retail they're more LP based and what their risk and reward parameters are then you can really hone in on like the exact assets to bring onchain what use cases to provide them and then actually drive value in that sense.

>> Yeah. Yeah. kind of coming to a a close on this on this kind of tokenization first front. This is all this could be kind of a delta neutral strategy. It could be improvement of processes. It could be efficiency based. We haven't really talked much about whether or not you know your firm has a more broad uh let's say a directional thesis on on digital assets. I'm just curious like whether it's it's your personal thesis or uh representative of the firm generally. How do you guys think about the asset class as a whole uh in terms of the size or TAM and uh you know what kind of trajectory you would expect this asset class to go on for the next decade or so?

>> Yeah, I think from a firm level um and also a personal level um you know we we are a firm that are very innovative. So you know in the very beginning I talked about like we have like we lobbyed for leverage and inverse single stocks. We we issue those products. We are always the first to issue a lot of quite innovative type of products. Um you know we have like for example cover call products you know we're looking at all these like optionality how do you put it in a product right put it in ETF put it you know uh to be able to be traded on stock exchange um you know we have uh we also cover like asset classes that are very hard to trade so we have like middle east products Southeast Asia products so a lot of these markets harder to trade maybe illlquid sometimes

and you know currency hard to hedge maybe like for example Middle East is opens on Sundays don't open on Fridays right it's like these type of things actually make product design quite difficult. So I think we are a house that are always uh trying to move ahead and be very innovative. So from our perspective uh we see the trend uh for RWA we see the trend uh right for the blockchain technology we see everything that's happening. So you know it's uh it's kind of a push and pull factor like we want to uh move first. We also want to understand the market and be ready for that right because if um the endgame or or eventually is um the ETF may be replaced by something else that is more

efficient then we want to do that we want to be there. So that is kind of our thesis now. Um I think everything needs to be still from uh one the demand side and two um in line with regulatory uh side as well right. So um I think uh you know the the whole um um digital asset space is getting more and more regulated is moving towards regulation which is always good because that also means more clients may come in more people will come in and the pool will be become bigger right so I briefly talked about like stable coins in Hong Kong I think that's a good example right it's it's always a starting point um people talk about oh there are already very successful stable coins globally so Hong Kong uh what is kind of the advantage actually it's key because uh you know if

Hong Kong is pushing it, the banks are pushing it, then more people will understand about it, more people will be um like adopt the concept of wallets, of the technology of trading digital assets. I think that by itself is very very important. Um so you know we see that trend we want to be there. Um but you know it it has to be demand driven again. Um it's not it's not everything cannot just be forever proof of concept. It needs to be you know people actually want it. So I think in the very beginning I talked about some of the products that we have like for example like memory chip right actually a lot of cryptonnative clients um they want to trade these type of names in the trafficy space um because they're there's it's just not not available on

chain right so if you put on chain maybe it's interesting for these clients as well there a lot of them are technology background a lot of them are looking at AI are thinking about AI right so I think it combines with what the client wants and what asset class should be brought out there. >> Yeah. >> Yeah. >> Yeah. >> Teddy, um, close us out here, man. Just final thoughts. >> Yeah. Yeah. I mean, I was, uh, you know, I was going to say I think I, so I actually just flew in from Hong Kong a few hours ago, and I was actually giving a keynote at the main event, and I was giving some market stats kind of like what Melody was mentioning. I think the stats came out, too. I think it's like 10 or 15 bibs of like the actual real world. It's only on chain now. So, the I

mean, the opportunity is massive. And with all these different asset classes, all these different opportunities, um, you know, what we want to do is be at the forefront of offering these types of products to, you know, not only like purely crypto people, but like web 2.5 folks coming into the space, working with different distribution channels. Um, you know, we recently announced our partnership with, uh, you know, a neo bank, Etherfi, not too long ago. We have a bunch of exciting announcements along that realm, uh, coming out soon. So, you know, I think the main thing that Melody brought up that's, you know, um, kind of been our thesis from the start is that you need to start where the demand is.

You know, you can't just bring on assets. Just bringing on assets on chain just, you know, if there's no true demand, no real use cases for it, then why would someone buy this? Why why wouldn't they just do in the real world, right? But when you can create these different opportunities of in a more ecosystem play, then you can actually see true demand. And that's why, you know, I think for Plumemer now, we we're the number one chain by retail Art of Bay wallet holders. Um, because of our Nest product and how we're able to permissionlessly deploy these strategies yet still have a pretty firm regulatory strategy behind it with our SEC licenses, what we're doing in Abu Dhabi, what we want to do in Hong Kong as well.

So, I think just to sum it up, um, you know, it's still pretty early, but this year is looking pretty promising. >> Yeah. And I think um you know to both your of your points on the demand side there is a cohort of investors who live on chain. They do all a lot of their financial activity on chain. They do not want to you know go to a brokerage and you know offramp and all of that. It's so much easier >> in this entire life cycle of you know people like myself operating on chain. solely been to develop a crypto portfolio to have a kind of very risk on part of your broader portfolio.

>> But now where we're heading is this is not just going to be like the risky part of your portfolio. There's there's uh you know stocks, commodities, T bills, etc. It's actually the home for the portfolio now rather than just the home for like the risky part of of the portfolio. And I think that's the major change that >> onchain investors who are native to the technology will really appreciate. So guys, thank you for being here. Awesome end of the show today. Teddy and Melody. Guys, that wraps us up for the week. We will not be live on Monday, which is rare. We have been doing it every day.

We have a special guest. >> Kathy Wood is dropping on Monday. We will be posting her episode on Monday, taking a day off, cooking that, and then we're back Tuesday. So, we'll see you Tuesday. Stay tuned for Kathy, guys. Thanks again. >> Thanks for having us. >> All righty, [cheering] guys. See you. See you Tuesday. [screaming] [music] >> [music]