🚨LIVE: No Bipartisan Deal On CLARITY?! Circle's Q2 Numbers! HYPE, ZEC, PUMP Strong. Arca & Tapir In

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[music] [music] [music] >> Sanity. Sanity. Floor. >> [music] >> We'll see you around the timeline.

[music] Feels good to be back. >> I think The [music] Rollup is one of the most premier media brands in crypto, and Andy and Robbie are great [music] experts at everything they talk about, and it's my favorite podcast. >> I add it to my library as [music] we speak. >> Potentially multi-chain deployments. >> We are at Devconnect day one here at the station from space. >> [music] [music] [music]

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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. >> YOU SAID IT. YOU FINALLY SAID IT. >> I'M SO BULLISH. >> And he's bullish. I'm bullish. We're bullish. >> [music] [music] [music] [music]

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>> The 5 D new mouth. These institutions aren't coming, they're simply here. >> Taste the Roll Up, ladies and gentlemen. Get the max. >> Get right. Let's go. >> [music] >> Welcome to the nest. See you on the show. >> We are live here in South Florida, August 5th, at the Roll Up, and there is a flurry of meetings happening right now in the Senate, in the Congress, to try and make a last-ditch effort at saving the Clarity Act. It is do or die time. It is now or never time. And we have about 24 hours for this thing to either get put on the Senate floor, or there's going to be a recess on Friday, and uh it's not looking good for Clarity. Uh

Eleanor Terrett uh reported that there is no vote happening this week. There's no cloture vote because Senate Majority Leader John Thune did not file cloture on the Clarity Act this afternoon. That gives bipartisan talks just a few more hours to land on something something resembling consensus. It is Wednesday, August 5th. I am Robbie Clagus and this is the Rollup. We've got a fantastic show for you guys today. As always, big shout out to Plume, building the future of on-chain capital management. These guys are powering the tokenization tower and we will be live from the tokenization tower again very soon. We also have lots to cover today in the

next 30 minutes or so. We're going to cover everything from the Clarity Act to Saylor dumping to gold up 4 and 1/2% today. The S&P erasing its entirety of gains. Like I said, the Clarity Act does not look good. Bitcoin's holding the line. ETH looks fantastic. The entire altcoin complex seems like it doesn't even want Clarity to go through. This is what we have on the docket for today. Guys, hit us up in the chat. We're stoked to have you here and we're going to be chatting with a couple of uh couple of guests in a little bit. We've got Katie from Arca chatting about Uniswap and Aerodrome shenanigans. These two were just going

back and forth at one another. And then we've got uh Marco from Tapir and uh yeah, it is quite the day, quite the market and uh it feels like there's a ton happening despite rather apathetic market conditions. Everything you guys need to know is going to be brought to you live today right here. And before we get into everything, we're going to tell you about Frax. They are our stablecoin sponsor. Uh Frax is building open, stable, and borderless money. Uh they stand to benefit quite a bit as a result of all of the lawmaking from the Genius Act. Uh the Clarity Act is now coming through. Sam is an incredibly intelligent and thoughtful person as it

comes to designing protocol mechanics. Uh he does this with regulation in mind, essentially front-running a lot of the regulation so that he is prepared and the protocol is prepared for what's to come. I anticipate Frax being one of the few stable coins that is considered money. That is what we have for Frax today. And now, our weather segment. Think I got that right. Let's go ahead, keep things rolling. Today's topics and weather powered by Relay. Weather is 91°. It's hot, it's sticky, and that is what the market feels like. It feels like the market's hot, and it feels like

the market's sticky. Feels like this is actually a foundation that we can leverage, not taking leverage, but we can use the foundation that's being built right now and use it as the foundation for the next bull cycle. This is what's happening. We have tons happening in the market, so we're going to kick it over to markets. Uh first, let me tell you about our next partner. These guys just launched tokenized equities in the United States. Denari is doing incredible things in the tokenized equities world because they brought the entire S&P on chain. This is the first of its kind uh innovation. They did something that none of the existing broker-dealers were able to do, and none of the existing

tokenization players were able to do. And they took a broad approach, able to tokenize everything. Previously, the only way that you were able to tokenize without going directly to the issuer, which was a very narrow tokenization mechanism, was that you had to do it You had to do it with all these crazy SPV wrappers. Denari doesn't do that. Shares are actual shares, they're actual equities. You can go to app.denari.com and trade the entire S&P. Uh you can connect your wallet, you can choose exactly what network you want those assets deposited on, and uh they've got tons more coming out. Uh we had Gabe on the show yesterday and he was talking

about some of the partnerships that they have on the horizon. Man, I am more bullish than ever on Denari and the future of tokenized equity. $60 trillion at stake here. Bitcoin eats Solana up, Chainlink near flat. Man, I am just looking at the market today and I mean, it feels like it's still sideways, but the macro environment here just seems friendlier than ever. Equities appear risk on. S&P had a nice surge to start the day.

S&P as well as QQQ, QQQ up 3.33% to start the day. S&P recently, just in the last few hours, retraced the entire gains that they had today and gold made just an enormous move, something like 4 and 1/2% in a matter of hours, which is pretty insane for an asset the size of gold. So, we're monitoring the macro environment. Guys, I'm curious what you think. Why do you think gold is rallying midday today? Um also, it seems as if they're doing some yield curve control. Uh they're steepening the yield curve. I read a fantastic article from Arthur Hayes.

You guys know that guy well. I don't know. Um I tend to trust his uh his macro calls a little bit more than his altcoin calls these days. So, uh you know, the the Treasury intervened in the Japanese yen. That is helping to devalue the US dollar relative to the yen. They were able to strengthen it. If they're able to continue to do this, you know, they can effectively just take these Treasuries off the books, reconcile them on the on on, you know, the US's balance sheet. That's effectively like quantitative easing, but from the Treasury point of view. Uh they were doing that with intervening in the yen, which had previously caused some troubles, but isn't going to do that if they're able to intervene. The

Fed chose to hold hold rates steady. They didn't raise rates. That shut shot the 10-year and the 30-year sky-high in terms of yields. But that actually means our banks are able to make more money. Based on the higher end of the yield curve, they can lend out more and we're seeing more credit be created. In theory, and and this is somewhat according to Arthur Hayes, but in this is to fund the AI trade. So, if you want the AI trade to continue and in theory that's what we want. I mean, we want it to continue.

Uh it is bullish for the US economy. It's bullish for equities. I'd imagine that Trump at least wants this to continue through the midterms if not all the way through to the next presidential election. And so, what's happening here is look, the main prerogative of this administration is to keep credit flowing. To continue to build out AI, continue the CapEx acceleration of the AI market and keep these AI stocks and hyperscalers punching higher. To do that, we need cheap credit. But you got inflation. You can't cut rates to make cheap credit cuz then you're going to just inflation is going to tear your face off. So, you need to create cheap credit another way. And the way that they're doing that is they're

actually sending the yields higher, but they're relying on the banks, the commercial banks, not the Fed, the commercial banks, the regional banks to create the liquidity, and that is ultimately what finds its way into AI. Arthur Hayes would was arguing that that's actually a misallocation of capital. Uh you want the credit to to get created, but you don't want to allocate it to AI data centers cuz that is decelerating. They're signaling less CapEx, but he thinks that credit is going to make its way into crypto. This is going to make and form the bottom on things like Bitcoin and going to accelerate us to new highs calling for a million-dollar Bitcoin in 2028, $5,000 ETH by the end of 2026. Let me know if you guys vibe

with those predictions. Let's continue. Market looks phenomenal. ETH looks great. Um and so, yeah, I mean, that's what's happening in the markets. Uh risk is getting the green light from tech, cheaper oil, lower yields uh on the short end, longer uh and is signaling higher yields, but that is not slowing down credit creation. Uh we're going to tell you about our next partner who is certainly at the heart of the AI buildout, and that is Near. Near is an AI company that found itself in the crypto world. They have a token.

It's fully diluted, and they're talking about making it fixed supply and potentially deflationary with the latest proposal from the leader, Illia. Uh I'm a fan of this proposal. It's funny to hear how much conversation is happening around issuance. We're going to talk a little bit more about the ETH issuance debacle unfolding. But, this is what's taking place, and I just I would imagine that this thing is just going to continue to rocket ship uh as the AI buildout continues. We're going to talk a little bit more about this coming up later on the show. Let's get into our tweets for today.

First up, we're going to tell you about this S&P Bitcoin ratio, which has broken and held above its 200-week moving average. So, originally, there was a lot of people that were calling for a correction in the equities markets. You could argue that that happened. Leopold got liquidated and burnt out, blown out. And so, now we've actually rallied off of those lows, but it feels as if there's some fractures in the S&P, fractures in the equities market, and people are a little bit less confident that this acceleration is going to continue.

You know, we were looking for just a full-on blow-up of the equities market, and that capital to rotate into Bitcoin. It's really not that simple. It's a little bit more nuanced, and we might have gotten that correction that we needed, and now starting to see the rotation into the Bitcoin market altcoin complex as there are some fractures in the equities market. If you start to see some deceleration in this AI CapEx out, see some deceleration in the amount of new data centers that are being commissioned, that would be the signal that there are some forward-looking multiples that are starting to compress as a result of this deceleration in CapEx, and then that would start to signal this rotation. So, it's not something that happens overnight like

Leopold getting liquidated. This is something that takes time, capital formation to play out. Arthur in his article argued that this is created as a result of the misallocation of capital. You continue to create credit, but it ends up going into Excuse me, ends up going to AI build-out when it doesn't belong there. When it doesn't belong there, this ends up as a misallocation of capital, and Bitcoin sniffs that out and is the first to react to it. So, in this chart, you can see that there was a 200-week simple moving average here that was tied to the S&P 500 or more so the ratio between the S&P 500

and Bitcoin, and uh that ratio is finally now starting to break out. Which signals that Bitcoin is at least holding up. Obviously, we want to see this break out to the upside. You want equities rallying at the same time Bitcoin's rallying, but we want Bitcoin rallying harder. It's not what happening here. S&P corrected, but Bitcoin held up, and so therefore the ratio is starting to improve, and it's starting to supersede that 200 week moving average. I don't pay a lot attention to technical analysis, but it is interesting to just see a technical indicator starting to signal that Bitcoin is beginning to outperform.

So, let's continue. The next one is a little bit more on the nose. Polymarket's revenue today $271,000. Pump Fund's revenue today $1.49 million. Kind of makes you think. One of these raised at 15 billion. They're talking about Polymarket. Polymarket actually there's rumors that say $1 billion dollar raise at $20 billion dollar valuation on $271,000 of revenue. Not really making sense. That multiple is insane. And so, people are arguing that Pump Fund is undervalued relative to Polymarket.

There's a couple different ways to look at this. I think that's one argument to make. I have friends of the show, co-hosts of the show that are long Pump Fund. So, they would argue that Pump Fund is undervalued relative to something like Polymarket. I think it's important to remind people that Polymarket isn't really out there trying to monetize, trying to capture revenue. They would much rather just continue to raise money, get a ton of revenue, get a or excuse me, get a ton of market share, grow a lot in terms of user base, and not charge people for that user activity quite yet. They want to try to undercut Kalshi, gain more of the prediction market's market share, raise a ton of money based on their daily active users,

and then go get partnerships, go get integrations with the ATP, the official tennis partner, you know, FIFA, tennis, Robinhood. Like there's so many financial applications, so many news integrations, media outlets that Polymarket is going to want to integrate into. And to do that, they want to show a ton of daily active users, use those daily active users to go raise more money, and then spray a ton of money at all of these potential partners and integrations, and they're not really recouping a lot of that money back from their user activity cuz they're just grow, grow, grow. They're in total grow mode. They are not in, "Hey, prudent business model, charge our customers,

make sure we're profitable" mode. They're not quite there yet. I'd imagine Polymarket is going to time a US launch with an IPO of sorts, and uh potentially stay private for a while, but I think these guys are going to be targeting the IPO, potentially doing an IPO plus a token. They would be the ones to do it. I think it would be an insane play. I think Shane is one of the ones to pull it off, and I do think that they are born out of crypto nativity, haven't launched a token yet, one of the largest companies by size as it pertains to this industry at large. Think Polymarket is one of the few companies that can pull off an IPO and a token.

Maybe clarity helps them get that. Maybe SEC rule making helps them get that. I don't know how far along or far away they are from doing such a thing, but I would love to see Polymarket be one of the first and only token plus public equity companies in the United States. Uh New Type Trader, welcome to the show, brother. It's good to have you here. Let us know what you think about a Polymarket IPO and token launch. Also, Pump Fun 1.49, uh Pump Fun is encroaching upon Hyperliquid revenue. Uh Hyperliquid is bouncing significantly today, which is great to see. Guys, we're going to keep things moving along.

The next one that I want to tell you about is the newest shared liquidity protocol on the block. So, let's play it. We're going to tell you about 1 inch. 1 inch is just launched their aqua product. They let you approve one wallet balance back to multiple positions at the same time. The The cool thing is that these these coins, you can use them for multiple things. They don't ever have to leave your wallet. The thing is that you can effectively passively provide your liquidity as you want it. You can provide liquidity that you don't even have cuz it's just allowing a balance to be spent. And what that allowance does is 1 inch will pull those coins out of

your wallet if they're in your wallet if the liquidity makes sense. And you're going to be paid if you do provide that liquidity. It pulls it, it provides it, and then it puts it back in your wallet. You can continue to do things with those coins. And it's just going to pay you all along. So, it's a totally different way to keep your liquidity active in more markets. You can apply the same liquidity across way more markets versus just depositing that liquidity into a single liquidity pool. Very cool to see some of the OG builders in ETH DeFi continuing to make innovations across the liquidity provision sector.

Let's keep things rolling. We got our next tweet up. We're going to bring you SpaceX. SpaceX posted second quarter 2026 financial and operational results. These guys beat earnings. Elon told you not to short. He told you not to short. Why would you co- counter trade Uma? Why Or Or excuse me, why would you counter counter trade Elon? I'm reading the the chat. Waiting for more regulations for prediction markets. Personally, I still don't like how Uma token holders have the final say when settling events. Yeah, Newtype, I hear you on that, man. I remember seeing some sort of partnership. It was like EigenLayer plus Uma plus Polymarket.

They were going to allow you to deposit not only UMA tokens but also ETH and more tokens into this pool and then anyone who deposited into this pool was going to be able to vote on the the resolution of these prediction markets. It felt like a great way to increase the level of economic security backing some of these prediction markets, but then it never came to fruition. And then we saw just another market after market after market was like, "Hey, this is corrupt. This is too low of liquidity in order to back this much in market share." I think that was around the strategy selling Bitcoin um um market.

So, yeah. I I agree. Polymarket's got to do something. UMA's got to do something if they want this to continue. Uh but it would really be cool if we could get a public company with a token. Don't think SpaceX is going to do that. Maybe Tesla would do that. Uh but at the very least we do have these equities tokenized and you can trade them on app.thenr.com. Uh SpaceX reported $7.8 billion in Q2 revenue up 92% year-over-year EBITDA expansion. Uh they also announced a partnership with Nvidia. Think they're going to exclusively use Nvidia GPUs. Uh they they have a new name for it like Star Miner something like that. Uh which is very cool to see and uh yeah, they have $100 billion of cash and they

reported the 16 or excuse me 60 billion-dollar cursor acquisition. So, that's very cool to see. These guys don't short Elon. That's the number one thing I can tell you on that front. Um next up we've got friend of the show Don Alt. Never been on the show, but been following him for a long time. Sailor selling holders getting drained AI trade correcting / imploding. Sentiment's horrendous.

Sentiment's apathetic. Bitcoin has been selling off for months whenever it's been given the top tiniest reason. And now it's not moving. And so we've been talking about this. Um Yeah, new type. I know, don't short SpaceX after Elon tells you not to short. It's kind of like the same Trump factor. Uh but definitely, I mean, especially today, I think there was something like something like double the amount of supply that was coming into circulation. So, um I don't know. I wouldn't That thing is so volatile. Uh there's probably a short in there somewhere, but it's uh it's pretty tough to find.

Um yeah, guys, we've been talking about this thesis for a while now. Uh this is the idea that uh Bitcoin, which had been selling off repeatedly, every bounce was a dead cat bounce. Um at a certain point, these things do go up. Macro seems to be shifting. It seems as if AI is decelerating after um uh what, you know, we saw happen at Leopold. Kenny G from Citadel came in swooped up all those assets. He liquidated our boy. The equities market is correcting. It is bouncing, but it erased all the gains on the S&P today.

Gold is signaling that things are getting a little bit higher. And so, these things are starting to shift. It feels like there's a transitionary market right before our eyes. What that means is that as Bitcoin starts to recoup some of the liquidity that had been previously going into the AI trade, it slowly starts to form a bottom. Obviously, before you go up, you have to not go down. That is what we're seeing happen right here. Bitcoin is not going down even though Sailor's selling, things are happening, Clarity Act's not getting through. Another take on the Clarity Act, someone someone said this while while we're in Vegas, which was just that, you know, the market likes certainty. Right now, it's a very uncertain time because we don't know. We simply don't know

whether the Clarity Act is going to go through or not. The fact of the matter is that it doesn't matter whether it goes through or not. It can It can go through and the market's going to pump. It can not go through and the market's still going to pump because market wants certainty. They just want to know is this thing going through or not so that we can re-rate and re-price the market accordingly. When it's uncertain and confused, that's when we are sort of low liquidity environment, low volatility. We're going to kind of stay on the sidelines cuz we just haven't seen the trend yet. But once this thing ultimately reaches consensus, we're going to see the trend emerge and that is when liquidity returns to the market.

So I think Don Alt is completely right. This is sort of what we've been seeing on our side as well is that it does feel like there is now a uh a return uh of liquidity to the market. So very very cool to see and we are very excited for this pre-bull phase, guys. That's what we're in right now. We are in the pre-bull phase. And we appreciate New Type. We appreciate Freedom God for rocking with us throughout this entire transitory phase in the market and uh I welcome you guys to the pre-bull phase. Uh everyone here watching this stream today is pre-rich and I just want to congratulate you on that. Uh we've got our next partner.

Our next partner is Zama. I'm drinking hibiscus tea. Zama would keep that information confidential. And so if you are a little bit concerned or if you're just a private person and you don't want the government or you don't want the powers that be looking at your wallet balance, looking at your account balance, if you're RWA centric, if you're an institution, you can use Zama to protect your assets. You can keep them confidential. This is something I anticipate will continue to grow because an asset on chain stays on chain and a confidential asset stays confidential.

Big shout out to Zama, one of the leaders of the privacy trade. Next up, Hyperliquid is looking like it solved one of the biggest threats to its value accrual thesis in a long time. So, people were speculating that Trade XYZ was raising money. This was a problem for Hyperliquid because Trade XYZ handles a significant amount of the revenue that is going into Hyperliquid. And so, um with Trade XYZ handling so much of the HIP-3 revenue, so much of the RWA thesis on Hyperliquid, it was like, "Whoa, if Trade XYZ is raising, they're thinking about accruing value directly to their

entity, maybe launching a token, generating stakeholders, you know, all of these kinds of things. They're going to be looking for growing, they're going to be looking for growth, and they're going to ultimately be looking to verticalize and monopolize some of the perps volume here. They could even build out some of their own back end and start to run some trade execution on their own, rather than just sharing, sending all of the order flow directly to Hyperliquid." Here we have, reported from Hyperliquid News, "For the first time, Trade XYZ using HIP-3 revenue to buy hype."

>> [snorts] >> Which was then used to purchase a new ticker. This is a new development in the Hyperliquid world. Previously, fees generated by Unit XYZ were converted into hype and used to buy spot tickers for Unit and HIP-3 tickers. Using HIP-3 revenue, Trade XYZ purchased 2,000 hype for approximately $108,000. So if revenue from Trade XYZ is going into buying hype, and they're not using that revenue internally to build out some of their different business lines, using it to verticalize their own stack, using it to pay equity holders, using it to pay token holders, this is a massive development. This means that Trade XYZ and Hyperliquid are ultimately on the same team. Kobe was right.

There was massive panic in the streets that said Trade XYZ was raising. But Kobe said 0% chance that is accurate. And this piece of news confirms that they are not raising. And so I tend to trust Kobe. I tend to think that, you know what? It's probably the case that these guys are actually aligned with Hyperliquid and this is a tremendous partnership that they're going to keep rolling. And so here's the chart. You can see it right there in the in the explorer there. You can see the trades. They bought the hype, 2,000 hype for $108,000 and this is what they're using to you to buy new tickers. So, big big development out there in the Hyperliquid

world. I have a feeling Beef is going to talk about this on the Grill Report on Friday. So, big shout out to Beef. Excited for our Grill Report on Friday. Next up, we've got our daily equity segment. These guys, I mean, like I said, I'm just more bullish than ever on Denari. Um I mean, there's no one else out there that is tokenizing the entire S&P. It's as simple as that and you can do it everything on chain. Uh let's go ahead and start our daily equity segment for today.

All right. So, that's the daily equity. Today, it is PE Equity Research, a good read from Counterpoint Research on the optical transceiver ban. So, if you guys are unfamiliar with this, what we have here is saying that um there is a ban on this GPU cluster. There is effectively this like divide. Obviously, US and China are just fighting, right? To win the AI race. And so, this copper wall problem is that as the AI race shifts towards the genetic AI and massive GPU superclusters in these data centers, traditional traditional copper cabling hits physical limits. Uh this means that data centers have to adopt high-speed optical

connections. And so, the ban that we had over the last day or so is that the US FCC is drafting a ban on imports of new Chinese optical transceiver bottles to secure critical AI infrastructure. And so, what this means is that it's going to become more difficult to build out these data centers effectively. Optical networking is a critical AI infrastructure, but it's a choke point because right now we're getting all of it from China, and the US does not want Chinese infrastructure in American data centers. And so, if you continue to scroll down here, uh there is this interdependence. I mean, we've manufactured so much infrastructure in

China for so long and then ship that over to the US that Chinese manufacturers collectively supply roughly 2/3 of the global volume and about 60% of global optical data comm transceiver revenue. So, this is a massive market controlled by China, and the data centers everywhere, including in the US, are reliant on this infrastructure that we currently get from China. And so, how are we going to build out these data centers if we're not able to manufacture these optical uh receivers, but we also can't get them from China? We need to get them from somewhere, or we need to build them ourselves. And right now, we're trying to build out these data centers so fast that we just don't have time to build

out some of the underlying infrastructure. And so, the leaders right now are Chinese companies. Uh they lead the global data center optical transceiver market about 27% revenue or excuse me, revenue share. And then another major Chinese supplier is Eptolink. And so these are deeply intertwined supply chains. And the US data center build-out is totally reliant on Chinese infrastructure. So this hardware loop is symbiotic rather than independent until we build out more of this infrastructure here in the US. That is what the US is incentivizing with this ban. I mean they drafted it to potential ban, but it feels like, you know, this might go through and this

would be one of the few pieces of regulation, not deregulation, that this administration is focused on. Uh, so we can continue to scroll down. But this would raise costs and delay hyperscaler AI data center build-outs. It would create upside for western suppliers of this optical cabling. Uh, so we know, you know, AWS, Microsoft, Meta, Google, these guys are building out data centers. Arthur Hayes is arguing that this is effectively just a real estate play, but he has you hoodwinked hoodwinked that this is a technology play.

And so we need to continue to build out these data centers for the good of our bags and the equities markets. But if we don't have the underlying infrastructure and supplies, we can't build out the data centers. This does have a potential to just kind of stretch out the build-out. Which could make it sustainable. I mean people are saying that, you know, the idea is that this is just going to continue to get kept afloat, you know, through the rest of the midterms. I have a feeling they're going to try to between Warsh and Bessent and you know, these sorts of hyperscaler build-outs, we're going to keep trying to keep this thing afloat through the next presidential election. Um, and so the conclusion here is that, you know, this this networking is becoming an AI choke

point. Uh, typically we've invested in these choke points like memory, like CPUs, just got further down the supply chain. Now the bottleneck is becoming these optical networking cables. Um, and it's not the same because there's just shortages and demand, it's because there is regulation. Uh, and the regulation uh, is a result of policy restrictions that may hurt near-term hyperscaler deployment speed while reshaping the equity winners across the transceiver supply chain. I'd also imagine that there's going to be a narrative at play here in the midterms, which is going to uh, slow down the AI data center buildout because we're going to have Democrats that are saying, "Do

you have data centers being built out on your farmland? Are they causing too much noise and hurting the environment? We're going to put a stop to data centers." They're going to come out and be so anti-AI during these midterms and during the next election that it is going to be just full-on, you know, narrative media bonanza against AI. Could slow down uh, slow down the buildout from a narrative standpoint. But from a financial standpoint, as long as, you know, the current administration is in power and controls the narrative, this is going to be uh, front and center.

So, let's uh, let's continue. We've got just a few more minutes before our first guest comes on. Uh, and so we're going to be talking about what a lot of you are talking about. Ethereum researchers propose to cut validator rewards to zero if half of all of ETH becomes staked. So many people came out against this proposal. Uh, the proposal is that it would gradually reduce uh, ETH rewards reaching zero if staking rises around 34% to 50%. Uh, warn that the move could force out solo stakers, giving larger operators even more control. This would centralize the Ethereum stake. That's something that people don't want to do. It would also

hurt DeFi protocols significantly because these guys rely on staking rewards. That is like the most fundamental of fundamental in terms of like risk-free rate as it pertains to the Ethereum ecosystem. There's nothing more baseline than the staking rewards rate. >> [snorts] >> Um and so people came out in force against this proposal. I really didn't see anyone for this proposal. Um you know, there might be some and I'm just going to play, you know, try to steelman this and say there might be some Ethereum ossificists that are looking to ossify, you know, the protocol. They're looking to centralize and ossify.

And if you're someone who wants to centralize and ossify the Ethereum protocol because you think it's too decentralized, you think ETH is money, and so, you know, you don't need a ton of, you know, validators. You don't need to be paying a ton of ETH to these validators. The network is just as secure with 100 validators as it is with 1,000 validators. One, you might be against the core, you know, philosophical ethos as to why Ethereum exists. But two, you know, you would probably make be making a case for ETH value accrual as it pertains to money, and you just want the protocol to function as fundamentally simply as possible and just pass as much value back to the token as possible.

And so you would be interested in lowering the amount of emissions paid to validators, lower the amount of expenses by the Ethereum protocol for economic security, and just just burn more tokens and just maintain and accrue more of that value accrual to token holders. So, I think that's the steel man for the argument here. I don't necessarily agree with it. I think the heart and soul of the Ethereum ecosystem is its DeFi ecosystem and that is really just starting to hit its stride with tokenized equities.

Um and you don't want to cut that uh that cut off um you know, that new vector, that new market that's emerging. Um right now when it really feels like it's heating up. You don't want to cut that short. You don't want to just, you know, handicap the DeFi ecosystem by lowering the risk-free rate um when you've got Tom Lee cooking and you've got the DeFi ecosystem cooking and it feels like the market's starting to heat up again. I understand wanting to make this thing a little bit more deflationary, but right now issuance is kind of fine. It's kind of fine.

Um maybe do this in the future as ETH continues to scale. So, we'll we'll see. Uh I'm interested to get our next guest uh Katie from Arca is going to talk to us a little bit more about the Ethereum DeFi ecosystem as it pertains to um the Uniswap Aerodrome debacle um and also uh I want to get her take on EIP 8363. She is the director of research at Arca. And um so, we are going to uh get her in in just a moment. Um and uh we're going to get her uh going here very soon.

Um Alex, could you send me live, please? Hey. Okay. Sorry about that, guys. We're back and uh we're going to bring Katie uh up in just a moment. Uh I just had a little fat-finger moment, but that's okay. Let's go ahead and bring up Katie. Uh we can send her live and uh and uh we're going to get her take on all of the things happening in Ethereum land today.

And so, I'll give her a little bit of intro while we get her ready in the back. Katie is the head of research at Arca. Arca is a digital assets investment firm. Also contributes to research with Blockchain Girls. With years of experience in the industry, she focuses on crypto token valuations, tokenomics, and market metrics, notably advancing concepts like adjusted market cap uh as a more accurate alternative to traditional market cap and fully diluted valuation measures. Uh this fits in very nicely with the revenue meta and everything that we've been talking about on the show today. And so, we're going to be bringing up Katie, the director of research at Arca, so that we can talk about everything that's happening here in the

decentralized exchange landscape, in the Ethereum landscape, and beyond. Katie, you're on the show now. Welcome. Thanks for coming. >> Thanks for having me, Robbie. >> Absolutely. It's a pleasure. Uh you're the director of research, so uh I'm excited to hear about everything that you are researching these days. Uh I think adjusted market cap versus traditional market cap is definitely something that we want to get into. We've been monitoring like token value flows, right? It feels like the conversation at hand here is all about issuance. I've seen this on Solana, Ethereum, Near. All of these guys are pushing proposals to lower the issuance of their tokens, make it more uh make it a fixed supply or more deflationary.

And also, you know, we've got this thriving DeFi ecosystem, airdrops coming online, Uniswap. These guys are going at one another. So, I'm excited to jump in, but first, it's your first time on the show. And so, I just want to get a little bit more background on yourself and ultimately how you found the space and what you're focusing on and most excited about these days. >> Sure. Um so, I started in crypto probably back in I think it was the end of 2017. Um I've uh worked in the fintech and VC investment space before that. Um and that's kind of when I learned about crypto. And as I was consulting, I met some of the founders of Arca at another project. And they actually decided to leave and start their own project um with all of their experience on Wall Street. So, I ended

up joining as the first employee. Um and since then, we've, you know, launched several funds. Um I oversee all the investment research into each of these fund strategies, built the research team from scratch, and I've continued to, you know, research as the space has developed. A lot has changed though since 2018 when we launched. And uh you know, we're initially doing liquid token investments. Um few assets, you know, there's some still some assets that are the same, Bitcoin, ETH. Um but even this is before so launched. So, um things have definitely changed a lot. Um it's great to see the ecosystem evolve, be taken more seriously. Great to see that we're finally getting regulatory clarity. Um and that's kind of a bit about me.

>> I hope we get regulatory clarity. I mean, it's do or die time, and we'll see. It It feels like we're on like the last ya- like the one-yard line, and who knows? We're going to need a buzzer beater for uh for this thing to go through. Um and so, I I'm, you know, we've been here, you know, since 2020 is when we started the roll up. And so, we've seen how this industry has gone through the ebbs and flows, and you know, the market uh the market evolutions uh just just as you have. And so, I'm curious, you know, you mentioned some things have remained the same, Bitcoin and ETH. Feels like those things are never going to change. We'll get into, you know, Ethereum and and the DeFi ecosystem. But I'm just curious, like you know, we were here it felt like, you know, when we first

started with the L1 trade, it was the alternative, you know, al- alternative all L1 trade was kind of taking the world by storm. Um then you sort of had, you know, DeFi summer. You also had, you know, the modularity supercycle, if you will, that kind of came and went. Have you picked your spots in all of these things at Arca? Or like, was there one or more market cycle that was just like really, really favorable to you guys? Like, just curious like what were what were some of the biggest winners and losers at Arca? >> Oh, gosh. I mean, I have to say like really if I pick one of the bigger, you know, winning cycles, it was definitely like DeFi summer 2020. And then going into 2021 just with like all of the on-chain activity,

kind of the giant presence of retail. And also we just had better volumes at that point. So there was a lot more you could do in terms of investing in really diversified manner. Now that's part of the challenge is that volumes have dried up, especially in a lot of, you know, longer-tail assets, not necessarily, you know, Bitcoin ETH. But as a result, you end up having, you know, this problem where liquid funds are struggling to operate because they can't, you know, easily invest in and out of certain projects. >> Yeah. >> But to answer your question about L1s, we've typically actually not been like hugely favorable about L1s. Like for me, I've always said what is important is like what's built on top of them.

There's obviously been, you know, this race and this competition between all of the different smart contract platforms. But at the end of the day, like if you don't have something that's going to attract end users, what's the point of having a billion-dollar protocol? >> Mhm. Yeah. Yeah, I mean that's that's exactly what is happening in the AI space now these days, too. I mean, it's like, you know, all of this messy middle conversation, the frontier models aren't, you know, capturing any of that value. It's all going to the compute layer. And people are realizing, wait, we can do all of this with open-source, open-weight models for like 2% of the compute. Can be catered a little bit more obviously a little bit more than that, but like, you know, it it all feels like it's accruing to the to the application layer in the AI world as well as what's

happening in the blockchain world, uh, which is a pretty fascinating development that this thing is just continuously kind of replicating where we've been. It feels like we've been here before. Um, and so, I want to talk a little bit more about this Uniswap Aerodrome I don't even know what to call it. These guys just continue going back and forth at one another. Um, Uniswap V4 came out. Uh, there's also like this data that seems like people are pointing fingers like, "You're lying about the data. No, you're lying about the data." And it's like totally disingenuous. And so, maybe you can just help us understand like the reality of what's happening here. Um, we've got some some stats here. Like, on on Base, it seemed like Aerodrome was

leading, but then Uniswap was claiming that they were, you know, basically at par. These then there was like this conversation about a lot of AI spam tokens and a lot of potentially wash trading that was at play here. Could you just help illustrate, you know, where the decentralized exchange space lives today? Let's say on Base, for example. And then maybe Aerodrome is launching on mainnet, that's another conversation. But let's just start with Base, you know, Uniswap being there Aerodrome being there. What is happening with the market dynamics between these two leading decentralized exchanges?

>> Yeah, so for people who haven't been paying attention, Uniswap recently, um, pushed forward the fee switch, which this has been debated for so many years, like since they literally released their token. Um, in the meantime, you also have Aerodrome that kind of has a fee switch built in or a revenue, um, a way that the token, um, return or the project returns revenue to their token holders. Um, and so, inherently, you're just always going to have this kind of push and pull. If people remember back to like 2020, um, this rivalry previously existed between like Uniswap Uniswap and SushiSwap because Sushi gave money back to their token holders, um, from what they earned. Um, Uniswap purposely, when they launched their token, were very careful about saying, "This is a governance token only and maybe in the

future it can have rights that allow them to give, you know, to put that revenue back to token holders. But at first they were very clear about like we want to grow the product, we want to grow the market, we don't necessarily want to be pigeonholed into, you know, giving out revenues early. Um part of it I'm sure was a regulatory thing, part of it was that they uh you know, we're focusing on growth as a lot of startups are, you know, expected to do frankly. Um but now that they've, you know, years later they're trying to essentially change their core user behavior and that's why it's just getting a lot of pushback.

Specifically though to base, um I mean the big thing is that, you know, a lot of trading that's on base has been from a lot of meme coin specific projects. Um and then the wash trading stuff that we're seeing, this happens in all of crypto. Um you know, there there's so many reports again and again that show a lot of volume is by bots, it is by um you know, it's it's not true actual user volume and um a lot of the time they're doing it for whatever reason, whether it's to, you know, um decrease in permanent loss, maybe it's to give, you know, projects a sense of credibility. Um maybe it's because there's people who are um farming on chain rewards. So it's really hard to kind of edit out some of this wash trading, especially since for years we kind of

took a lot of that data at face value. We didn't really drill down into much of it and say, "Hey, like is this legitimate? Is this not?" We also have only in the last like I would say 18 months started to hold like projects feet to the fire and say, "Hey, like you actually have to give us, you know, accurate data. You are responsible for this." Um and we've had, you know, a lot of great voices in the space such as like Blockworks, DeFi Llama, um uh Artemis, a lot of them that have gone and said like we want to actually come up with the real numbers like sans wash trading just specifically for volumes, but even with other, you know, projects and other data they're trying to do the same thing. And we're finally kind of getting to that point where we have like

a clearer picture and we're then able to actually make real, you know, investment decisions based on that real data. >> Yeah. >> And so, you know, as we're kind of thinking through, I think there's two sectors through the maybe two lens through which people are looking at, you know, kind of the debate between Uniswap V4 and and Aerodrome. One of them is through the lens of a liquidity provider and they're thinking, okay, you know, I have to choose. Do I want to provide my liquidity to Uniswap or do I want to provide it to Aerodrome? And so, they're going to look at who is going to give them more rewards. And then, I think there's another cohort of people that are looking at this through an investor point of view and they're looking which protocol is giving me more value accrual. And so, maybe we could

just approach that, you know, as it stands today with Uniswap V4 and I mean, there was a a tweet that Hayden put out which probably be a whole another question on its own, but you know, he he kind of quotes a lot of FUD or misunderstandings around the V4's fee switch. You know, one of these is that the LP fees are getting reduced as a result of the fee switch, the protocol is taking 25% of the LP profits. And so, is Uniswap V4's first uh fee switch reducing the value that ends up going back to liquidity providers?

>> So, from what I understand for V4 specifically, and this is separate from the V3 fee switch, which I know can get very confusing, is that V4 is specifically going to keep um liquidity providers um the same in terms of the revenue or fees that they earn, but that that fee is actually going to be added on for traders. Now, at face value, that doesn't seem like a lot. I think Hayden quoted um that, you know, five basis points on a trade, like nobody's ever going to notice that, especially when they're paying two to 300 um basis points on a centralized exchange. However, um from what I've kind of understood and I we honest, I'm not LPing, that is not something that I do in my free time, but for LPs, this means that it actually um it still cuts into some of their profits in a more

roundabout way, which is that um when they're thinking about how to um arbitraging between pools on centralized exchanges and in Uniswap or Arrow or wherever they're providing liquidity, um they have to think about that arbitrage. Now, basically, if you've increased the amount that they or decreased essentially the amount that they can earn by five basis points, it doesn't seem like a lot, but it does cut into some of their earnings. Again, this is kind of harder to calculate, um you know, especially when we're thinking through of like, okay, what do we think the value is going to be in a year from now? How are volumes going to be impacted? Um there's a lot of variables there, but those five basis points does make a difference. So, maybe not to me, the end user going and trading and using Uniswap, I'm not going to maybe change

my behavior that way. But, for the liq- the liquidity providers, that does cause a bit of a problem because it means that, "Hey, I have to now think about the fact that I'm not going to earn as much on the arb you know, on that arm." >> Yeah. Is there any sort of data around how much volume is retail volume, sort of just like one trip off trade that, you know, they they might do on a centralized exchange or they might do on a DEX versus like the amount of liquidity provide- or excuse me, the amount of arbitrage volume that you're describing where people are going back and forth, centralized exchanges. I mean, I have DeFi Llama open and I'm looking it says $6 billion of DEX volume over the last 24 hours. $6 billion a day is a massive market.

Um I mean, any idea on how much of that is like retail volume versus arbitrage? >> I mean, it's kind of hard. I haven't seen any recent reports on it, but I could tell you just from anecdotally what I understand and also when we've looked at kind of retail flows recently and how many retail participants are in the market, it's definitely not coming from retail at this point. Um especially since if you think about it, a lot of retail investors, they're still using centralized exchanges. Like even though DEXes have become more popularized, Uniswap um and you know, MetaMask have made it really easy to trade on chain.

That's still like a step for a lot of folks that they're not necessarily taking. >> Yeah. It I mean, it certainly seems that way. It seems as if this is you know, coming more from, you know, professional traders is the bulk of the volume. They're doing much of the you know, the the fees that this is this is getting back to the liquidity providers and they're going to feel it. And so, um what what you're saying is that, you know, this could be felt by these guys and they might make a switch as a result [snorts] of the added fees, uh this is going to impact some of their business. They're going to be more sensitive to it.

>> Yes, and for a lot of liquidity providers, they're running, you know, crazy calculations on not just what they can arb, you know, they're trying to take into account impermanent loss, realized volatility. Um a lot of them are having to, you know, short their LP tokens as well to, you know, kind of compensate on the back end. So, for them, it's a very complex kind of business that they're running. And I would assume in most cases, they're not just running liquidity on Uniswap. Maybe they're running liquidity on, you know, on Solana, on Jupiter, on other, you know, non-EVM chains. Um Uniswap is still kind of that this dominant force in the market just cuz they've been there so long. Um but, they aren't the only, I guess, venue. Um so, for a lot of them, it's going to be looking at kind of the full scope of where they

are, you know, providing liquidity and deciding, okay, where am I going to, you know, maybe shift funds around um or am I not going to maybe be participating in certain pools as much anymore. >> Yeah. I we we've got our chat here and uh someone uh new type trader has a question uh who says, "Has the rise of prop AMMs affected liquidity providers on decentralized exchanges or are they one in the same?" >> I think from what I understand about prop AMMs for now, um is that most of them are on Solana just because of Solana's inherent design. Um and I think that they are definitely taking over on that chain specifically because they're based on how Solana's blockchain

operates in terms of ordering transactions in a block and because of the speed at which their system operates versus EVM, the prop AMMs are going to be better for them. So, I think in that ecosystem you are seeing those prop AMMs do a lot better. I haven't tracked as closely the ones that are on Ethereum. I do believe there's one, but I don't think that they have been quite as successful to date. >> Yeah, I've seen our friend of the show Fede Intern talking about one and I actually spoke to one on the show just a couple of days ago called ByeBye.

We angel invested in M Team who's pretty deep in the MEV ecosystem. Young guy, I think they're coming to market with it next week. So, we're going to see you know how how the prop AMMs fit into the market share of decentralized exchanges as a whole on Ethereum here pretty soon. Okay, so that is a great analysis Katie of how liquidity providers are looking at the Uni V4's fee switch. I think the other perspective here is around you know looking at the Uni token and then looking at the Arrow token. And people are kind of weighing these as you know two of the major decentralized exchanges. They want to bet on you know volumes increasing especially with tokenization tokenized equities

increasing. There's a lot of volume here at stake. They want to know which DEX's token to own. As I understand it, these are two fundamentally different models for value accrual. One of them is you know the Uni token which you know they have this fee switch. They collect these fees and then it those fees go to burning the Uni token. And then Aerodrome returns the revenue from the Aerodrome protocol and all these all these pools to its lockers. Maybe you could just talk us through like the difference in value accrual between these two coins and kind of your reaction to these different methods.

>> Sure. So, I actually think the best way to think about it is actually in terms of how they've aligned their user base. So, again, I can't speak for all liquidity providers on Uniswap, but Uniswap essentially gave out their token to most people via their airdrop in I believe it was end of 2020 or 2021. And at that time, yes, a big chunk of tokens were given to limit to liquidity providers. But if you think about it, most of them are looking at it like, "Wow, this was a one-time payment." and a lot of them ended up selling. Some of them did you know, continue to earn tokens after the fact, but it wasn't really they weren't really being aligned. And there at the time, right, yes, you could vote in governance with the tokens, but there wasn't a huge incentive to really hold tokens that you

received. Now, on the flip side, the way that Aerodrome has structured their product is that if you're providing liquidity, you are also receiving Aero tokens as part of your payment for that liquidity like provisioning. And then those tokens the best you know, return for you is to lock them to earn revenue. So, what you end up doing is you create a cycle where you know, the people who are providing liquidity for you are the ones that are also your biggest token holder group. And they're also the ones who are generating your revenue. And so, you have this really nice feedback loop on Aero because you've got everybody incentivized to essentially, you know, not just be a participant in the ecosystem, but also be like an owner of the protocol in that sense.

>> Okay, so you'd say that the proportion of liquidity providers on Aerodrome that look provide liquidity and also own the token is much higher than that on Uniswap. >> Yeah, because basically, instead of giving revenue to liquidity providers on Aerodrome, the way it works is that Aerodrome liquidity providers, they earn the fees in Aero emissions. And the best thing for them to do is actually lock them in vAERO and then receive the yield, which is the revenues from the protocol through that kind of that I guess you could call it flywheel.

And as a result, what happens is that, you know, I believe in some cases people who've locked for VE VE arrow right now for the maximum of 4 years, they're earning like I think about 30% annually, which is a huge amount if you think about it. So, for most people, this it's a no-brainer to if you're you know, already providing liquidity, you're already getting these tokens, why not, you know, lock for the 4 years? >> And so, is would you say these protocols are kind of talking past each other? You know, these are like somewhat different models. Aerodrome, you know, kind of is going to give you all this value accrual, but you have to stake. Uniswap is going to give you a lot less value accrual, but you don't have to stake.

These are just different models, different If you want to stake, you should probably own arrow and stake it. If you don't want to stake, maybe Uniswap makes more sense. >> Yeah, I mean, I think especially if you in the case of arrow, if you don't believe that arrow will go up in value, yes, you should stake it because in this case, I'm kind of stripping out the actual, you know, increase in value of the underlying asset. I think what you said though is right on the nose about Uni. I mean, if you look at kind of just the annualized burn rate, which I believe is, don't quote me, like I think 50 million annualized based on the last like, you know, 30 or 60 days of revenue, that compared to Uniswap's like $6 billion market cap, like we're we're you know, that you're you're really not looking at you know, a really

favorable valuation there. You're I mean, it'll take 100 years at that rate to burn all the tokens in existence. And so, you're that's not nearly enough of a I would say supply sink for tokens in the Uniswap ecosystem. Now, on the flip side, Aerodrome, you know, again, it's just different mechanics. They're you know, a lot of their supply is locked. A lot of new emissions do come on the market, but they are are of recycled into this locking period. And as a result, you know, you just have that positive feedback loop. >> Got it. Okay, I want to I want to go for another couple of these misconceptions or fud that Hayden had from this tweet a few days ago. Um the last one here, he says, I'm just

going to quote this, "And to the fork that talks about Uniswap more than its own product." He's obviously talking about Aerodrome. "Takes 100% of swap fees and compensates LPs with uneven token inflation set by token votes." Is this just the same like VE model that we've seen, you know, kind of time and time again? It It It's something that, you know, we we tried it and it works in DeFi summer. That's effectively Aerodrome's model, um if I understand correctly. Um when it says when he says take 100% of swap fees and compensates LPs, like what is the misunderstanding there?

>> I mean, that's exactly what Hayden is describing, which is basically that any revenue or swap fees that are generated at the protocol level, they're not paid out in, you know, the swap fees that are earned in that particular pool to LPs. What they're getting is a proportionate amount of Aero tokens, because Aero has a continuous emission uh emission schedule. And then those fees, they essentially get kind of like I would say you can say sucked up into the kind of VE Aero um engine, and then they are emitted every epoch to the VE Aero stakers. But again, because in most cases you have the stakers and the LPs as the same person, the LPs are earning more.

Um according to calculations that I have seen on this, um technically the stake those who are staking are going to earn more in emissions uh sorry, the LPs are going to earn more LPs do earn more proportionally in Aero emissions than they do if they they to just earn the swap fees from the protocol. >> Got it. Okay. Okay, I mean that sounds favorable to those who are staking Aero. Um and so I mean as I'm kind of looking at the stats here, I at least on base uh base makes up $650 uh of that 6 billion that we talked about earlier and over half of it is Aerodrome.

Uh in the last 24 hours they've got 373 million in volume. Uh PancakeSwap on base is actually second and Uniswap is a close third. Um we know that Aerodrome is coming on mainnet very soon. Um do you have any insight into like maybe not when Aerodrome is coming to mainnet, it is inevitable, it is going to happen at some point. When it does, how do you anticipate the division of order flow to be on mainnet? Right now Uniswap is number one index volume on mainnet 1.28 billion dollars of volume over the last 24 hours.

How much market share do you think Aerodrome is going to take from Uniswap? >> I think that the question of market share, that's going to not happen immediately. I mean maybe it could, but I think that you have to think about every time that even think of Uniswap, they launched their V4 what like 9 months ago or more and they're only now making around they're only now seeing around the same volume as on V4 as they are on V3. I think the same goes for any kind of new launch on a chain. You're not immediately going to have you're not going to immediately have 50% market share day one. Um and I do you know I don't want to cold you know throw cold water on things. I'm excited for Aerodrome to get this launch underway, but I do think that it takes a few

months to kind of build up um and get either liquidity providers to you know switch. You're also going to be compete The big thing though also that they're going to be competing on which I do think they have an advantage on is that the end of the day users don't care about anything other than depth of liquidity. And so, if Aerodrome can manage to offer better liquidity on mainnet and on other, you know, EVM chains than Uniswap, they will start to see that market share increase because that's really the only thing that end users care about. >> Yeah. I mean, in this sense, capital is completely rational, right? They the liquidity providers will go to where they can earn more fees and generate, you know, more on the same unit of liquidity. And so, I'm curious, you know, because Uniswap and Aerodrome are

both both deployed on Base, that's kind of where we can, you know, do some of this foreshadowing. What do you think Why do you think Aerodrome is beating Uniswap so significantly on Base? Is it because they've just developed a more lucrative model? They have a more efficient AMM? Like, what do you think is the reason Aerodrome is winning so so much on Base? And I guess the the ultimate question is, do you think that's going to be replicated on on mainnet?

>> I I mean, I think all of the above, like you mentioned. It's it Like I said again, the liquidity is a big deal. They have a better model to incentivize those LPs versus, you know, just the basic Uniswap model that's available on Base. And they've been They were pretty much the first DEXs on Base if I recall. And so, you know, sometimes it does help to have that first mover advantage. I do think that they're going to be successful on Ethereum, though, because Ethereum has so many more assets. And so, there's just going to be greater availability for things that people want to trade. And I do think that for them, this is like the natural, you know, expansion of their business. I'm you know, not investment advice, obviously, but very, you know, excited to see them launch. Hope, you know, do think that

they're going to do really well expanding, especially since, you know, Base right now, in my opinion, they're going to suffer from, you know, not really having like a niche kind of set out for themselves where they can grow over the next few months. >> Yep. Yeah, makes complete sense. I mean, we're we're excited about this launch, too. Just from the standpoint of like how this dynamic and the the market share is going to play out between two of the leading decentralized exchanges on mainnet where, you know, like the show. Like, that is that is where you know, the the big players are.

Last question for you, Katie, from you know, again, not financial advice, but we talked a lot about the you know, where we think liquidity providers are going to position. A lot of the people that watch the show are, you know, they're more okay, well, sure, but what what token should I own? And so, would you rather own Aero at $830 million market cap or Uni at $3.5 billion fully diluted? >> I again, not investment advice, but I always say, you know, the underdog, look at the one that's kind of, you know, if they've got the same amount of market share, but one's got a smaller market cap, that should be kind of obvious in which you should choose.

>> Yeah. Okay, makes sense. Katie, thank you so much for joining. Really, really appreciate it. And terrific insights. We also, you know, we we love chatting with people that have a unique vantage point and can speak So many people love coming on the show, they talk their book. If we had a Uniswap person, they would come on, they'd talk about Uniswap. We had an Aero person, they would come on and talk about Aero. I appreciate your perspective and your insights on both of these so that we can, you know, we can sort of work these things out in real time. And I would love to have you on again, maybe when Aerodrome goes live on mainnet. Um

>> Maybe. we're going to we're going to see some some seismic shifts in the way that liquidity providers are allocating their capital. Um and uh I'm very excited to see how market share shakes out. Uh so we talked about the market share on base. For on uh DEX volume broadly, it's Uniswap, PancakeSwap Pump Metric, who I've never heard of, and then Aerodrome. So Aerodrome on base is number five in total DEX volume on one chain.

Uniswap number one on 47 chains. And so if we just look at mainnet, >> [snorts] >> um let's see. DEX volume by chain. I'm on DeFi Llama pulling this, by the way, and I think there might be, you know, a discrepancy in terms of depending on where you pull your data from. I mean, Aerodrome is almost immediately, I'd imagine, going to rot you just, you know, vault into the number two spot. Fluid is the number two exchange with 66 million. Um Uniswap is doing almost half, or no, more like a third of their volume on mainnet. Uh they're doing I think it was close to a 1.2 or 1.3

uh billion in volume in total. Uniswap is doing $500 million of that volume on mainnet. The the closest runner-up is doing 60 million. Uh that's Fluid, and then uh Curve as well, doing about 60 million on mainnet in the last 24 hours. Aerodrome is doing uh over five or six times that on base alone. And so I'd imagine Aerodrome is going to almost immediately uh get into the number two spot on mainnet, and it's just a matter of time uh before um you know, we see how much market share they're going to take from Uniswap on mainnet. I'd imagine it's going to be quite a bit and then obviously uh we

know about the the revenue and the value accrual story for Aerodrome uh as Katie just explained to us. So, interesting developments happening in the decentralized exchange space and shout out to New Type in the chat for a great question, especially after a guest that we had yesterday around prop AMMs anticipating that those are going to take uh some market share from these decentralized exchanges as well. And so guys, we are going to continue the show. We've got our next guest. Think we've got him ready behind the scenes. It is Marco from Tapioca Protocol and we're going to be chatting with him about stablecoin yield, safer stablecoin yield especially. Um you know, we've got more

on this issuances conversation as well. And so tons happening in this world uh and it's a stablecoin supercycle out there. So, let's go ahead. Let's bring up Marco. He is the co-founder and CEO of Tapioca Protocol. Hope I'm saying that right. Uh Tapioca is a depeg protection marketplace for DeFi yield assets uh and it's launching on Zerkit in July 2026. I haven't heard of Zerkit chain but I remember Yiannis from uh uh he was at Quantstamp I believe, was a great friend of the show and he came on several times talking about Zerkit. So, I'm I'm excited. We've got Marco, you're on the show now. Welcome and uh yeah, it's a pleasure to have you.

>> Hey, yeah. Thank thanks very much. I'm happy to be here. >> Absolutely. I know we've been trying to make it happen for a while so I'm glad that we could do it. And uh Marco, it's your first time on the show so I'd love to hear just a little bit more about, you know, everything that you guys have going on at Tapioca and uh learn how you got into the space and how you ultimately uh ended up finding this company. >> Yeah, uh so basically how it everything started or what is my crypto journey? uh I've had some e-commerce startups startups before, but kind of the highlights within my crypto journey is I co-founded Marinade Finance. Basically, that's that's our first liquid staking protocol on Solana. Won couple of ETH Global prizes.

Was doing developer ecosystem lead at SSV Network. Um yeah, mechanism design tokenomics at Diva Foundation. And basically tokenomics design, risk research, and analytics in token dynamics. As you can see, basically my background is mainly in staking in analyzing protocols, designing protocols. And yeah, basically that's that kind of uh let me especially my later works basically analyzing mechanism design and tokenomics modeling for Diva Foundation. I was analyzing the protocols. This the same

was true for token dynamics. I was designing some protocols, analyzing others. And that brought me to the idea basically that from the risk protection, we don't have good tools in in DeFi to you know, to as in traditional finance where a lot of derivative space is basically about how to transfer risk, how to be able to like separate risk from the yield itself. And that's what we are doing with the peer. You know, we are building a protocol that basically is helping DeFi grow up and is bringing risk primitive to be able to separate risk from yields in various investments.

>> Fantastic. And I have to ask, why Zircuit? Did I get that right? Is it only Zircuit? Why why are you doing this on on a blockchain? >> Maybe that's Well, Zerqaad is our first launch partner. So, we were supposed to be launching at Zerqaad at first. Uh we are close with the team and also with the with the Aqualor Quantstamp, which is basically the the spin-off uh spin-out of Quantstamp to launch Zerqaad. It's no longer a chain, but we are launching Zerqaad Finance is their current product. They no longer run the chain, and we are launching with them as with our first launch partners.

So, they have their own yield product that that gives you quite nice around 1.5% yield on USDC, and we are creating the first market for for that. >> Very cool. Awesome. And so, obviously we've seen how stablecoins have taken the world by storm. I think we're on pace for trillions of dollars of stablecoins in this decade, and it feels like this is truly a stablecoin supercycle. Maybe you can just help us understand the problem right now because Marco, you're talking about safer stablecoin yield, helping to protect yield that is currently in play.

Why is the current dynamic of yield right now? Why is it unsafe out there right now in the stablecoin market? >> Yeah, I mean that's a great question. That's a great question, and I think the DeFi Legos it's like one of the is the main thing that make makes DeFi so much more powerful than TradFi, but it's also kind of the the original sin of crypto that we are able with DeFi Legos just we are able to stack up yield very easily and have like one position, one token that represents a very complex position in the in the backend. You you you have all the different kind of vaults from very

simple ones to more sophisticated ones in that have very sophisticated strategies. Uh so, that's basically a great DeFi unlock that it allows for creation and packaging very complex strategies, you know, that that span across multiple protocols. But, this is also the Achilles heel that we have in crypto that if you are doing this, you are basically uh multiplying the risks of all the underlying protocols that you have in your position. And sometimes we end up in a situation as we, you know, as we have had with Aave and the the Kelp exploit, right? That people on Aave that have nothing to do with

uh with the uh rETH or rsETH were suddenly found uh you know, with potentially losing some funds. Uh I think I'm alluding to a hack that happened and most of the people in your audience probably have heard of it. But, yeah, anyway, long story short, what I'm saying is >> every day for a few weeks there. >> [laughter] >> Yeah. But, uh long story short, what I was saying is that this is this is kind of a problem that we have these very powerful tools, but we don't have good risk mitigation solutions for them.

>> Right. Yeah, no doubt. I mean, there was a, you know, a narrative at play around these prediction markets that said, you know, you could effectively take out exposure uh like insurance. Uh you know, people are doing this. Ice cream shops are taking out insurance against rain and and bad weather. And so, we could take out insurance against stablecoin protocols. You know, especially in a world where there's so many stablecoins, it makes sense that we're going to need some depeg insurance. Um what is the mechanism here? How do you provide this insurance? And where is the demand coming from? Who is saying, "Hey, we hold a lot of stable coins. We're going to want to pay for an insurance against this depeg." Who are the kinds

of protocols that are doing this? >> Yeah, just to clarify, we are not in an insurance business. We don't really provide insurance. The product we are building is a risk protection marketplace. So, we allow participants to basically buy or sell the risk portion of the of the investment. What we focus mostly on is the yield-bearing stable coins that are bringing some some nice yield with them. A lot of time, you know, things are called stable coins, although there is some like derivative yield strategy in the background. This is like the power of DeFi that you can have it like encapsulated in a single coin. So, there is like a huge spectrum of different stable coins from like very vanilla one

like Tether USDT that are secured by T-bills to like more and more complex ones. Yeah, so so we can you have whole spectrum of stable coins. And as you go higher on the yield curve, you should go higher on the risk curve as well. And yeah, what we are doing and how the mechanism works, basically we are creating a marketplace. So, this is Zercurit has like a very nice yielding stable coin. It's let's call it stable coin for for the the practical sense, which gives you yield of 9%. It's basically on the background they are running a strategy.

They are deploying funds to a fund manager that is running this, you know, yield strategy on this. So, obviously there is some risk. There could be some losses. There is some counter partner risk etc. etc. What we allow and how we come to the game is, okay, you could you you are not able to choose any like risk options here. You can either like take it or leave it. You can take the 9% as is or leave it. With the peer now, what you're able to do, you can say, "Okay, I'm okay to getting a little bit less yield. So, not getting the 8.5% but getting 7, 6.5% yield." But, if there is a depeg, if suddenly there are some losses and there

is a depeg, I get the full full money back. So, I get lower yield but I have guarantees. You know, if I get 6% which has guarantees and security against depegs, that also could sound very good to someone. On the other hand, somebody wants to could want to take additional risk. They they have done the due diligence. They trust that the team is executing right and they think that the premium is is good for them. So, they would be taking on around 10% yield for the additional risk.

Right? And what happens basically in case there is a depeg, there is a 5% depeg, the people the person if you're holding the depeg protected version of the token, you're getting less yield, just the 7% but in case of depeg, you are protected. You're not taking on any loss and the other side is taking double the loss. So, that's basically. >> Marko, I've got a little bit of a different question. Like, you know, you see a lot of stable coins. You've been thinking about this space a lot and providing insurance for this space calls for a very thoughtful considerations of these different mechanisms.

Which stable coin do you think or what kind of stable coin do you think is most likely to depeg? >> Yeah. Uh You know, as I was saying, I'm using the the expensive definition of stable coin here. So, any kind of, you know, something which is tracking the USD value uh and it's giving you yield if we are calling that stablecoin, even though I would say it's not technically a stablecoin, but, you know, we can we can say it is for like the uh examples of this discussion.

Uh anything like that can depeg. What I think can depeg the most or has the highest uh chance of depegging is these uh new stablecoins that, you know, represent some kind of a debt strategy. For example, recently we had we had there uh a token APXUSD that, uh you know, seems like a stablecoin, but actually on the background uh it is buying different debt instruments. It was buying the the sailors >> debt products from strategy. Yeah, we're we were somewhat familiar. We had them on the show as well. We were talking about This was back when Stretch was, you know, you know, $100. It was trading

at par. It's a fantastic idea. Uh but obviously we know what happened with Stretch and it, you know, went down >> Yeah, I I I just wanted to like give an example. I don't want to pick on them like particularly. Uh but, you know, any any type of product that is uh that is giving higher yield and potentially is running a more sophisticated does riskier strategy has much higher chance of depegging. I'm not very much worried about USDC depeg these days. Even if there is depeg, uh I think uh it it the the probability of long-term depeg, short-term depeg, yes, you know, if there's a big market dislocation, but long-term depeg, probably not. But, you know, any type of the these kind of

uh yield strategies or uh yeah, bond yield strategies. >> Yeah. Yeah, I mean, it's important to mention uh as you did the difference between a short-term depeg and a long-term one because obviously we had USDC depeg uh when Silicon Valley Bank and Silvergate was going through it's whole debacle but now obviously USDC is just as safe as ever and very much on peg. My my question about Tapear specifically is it permissionless? Like Can it can do you guys provide insurance for any protocol or any stablecoin or is it just a select few?

>> Uh One second a small correction it's not really an insurance. Uh it's it's basically a risk transfer mechanism you know but that's a nomenclature thing but we can provide it for everything. The thing here is that because how the how the Tapear is built we need for well functioning market we need uh enough liquidity. So our strategy our go to market is picking you know the products that we think are the best fit for Tapear and listing those one by one.

Uh anybody you know could potentially launch a market on the factory contract. Currently we are kind of keeping it more on the permission side but just from the from the security uh reasons you know we are very risk averse as you I guess want the risk protocol to be right. Uh so basically mostly from the security perspective but there is a liquidity constraint. So because of how Tapear works we need good liquidity to ensure good usage of the protocol so >> Yeah.

Um it makes sense I you know the question that I asked is because we've seen a lot of these different mechanisms play out. I could imagine a scenario if there's a very illiquid you know stablecoin there could be a way to short that coin and but take out some insurance or excuse me to out you know some some depeg protection so that if it depegs and you force it off depegs, you end up, you know, you you end up making some money. >> Yeah, I mean, that's a great point and uh we basically how we are structured, we are not focusing on the short-term depegs.

Uh our product is mostly for long-term holders. So, if there is a short-term depeg uh and basically the asset re pegs back goes back, uh you are okay, but also you will not uh you could be able to make money with the peer on this, but we have like a maturity and a redemption process as you have with, you know, more uh a lot of traditional derivatives. If you have as you have uh you know, we have some kind of a duration, 90 days, 180 days, and after that the market gets resolved. Uh you also raise a good point, what what happens if like at the very end just suddenly someone moves the price.

Obviously, we thought of that. We are taking multiple price feeds across multiple times, you know, across the couple of last days. So, uh yeah, we are aware of these risks and we want to take like the the very robust price that was held across multiple days consistently at the end to prevent exactly things like these. >> Yeah. >> Uh so, yeah, we are prepared for this and uh yeah, we are for we are uh protecting uh users against long-term depegs. >> Fantastic. Um Marco, just a few minutes left. I mean, tell us a little bit more about Zerkit. You know, what is happening there? Should our community get involved? How can they get involved?

You mentioned it's not a blockchain anymore, but it sounds like there's still lots of financial components, stable coins, uh different decentralized applications. And so, tell us a little bit more about what is happening on on Zerkit and and how our community can get involved. >> Yeah. So, uh with Zer Capital, they currently are running the five strategies. Zer Capital Finance, that's that's their main financial product right now. And it's a nice and juicy yield. We have actually I don't know when I when this goes live, I think we are live. So so >> We are.

>> We're live. >> Yeah, but what I was saying that we are already on deploying everything live and people will be able to you know, have the deep back protected yield of Zer Capital or have the yield boosted one with higher yield. That's one thing. And as I said, Zer Capital is mainly right now the the yield product running basically a yield strategy on that. Maybe another thing I I would say and I would have an ask for your audience. We would be very much interested in what assets or what asset they would want you know, some kind of a deep back protection like this for us to make.

Because we'll be going one by one by one focusing on launch with each partners. We already have some other partners in line scheduled. And we are thinking what what you know, assets would your would your audience would love to see. What we think mainly is you know, high yield assets that have high risk. Those seem like the best fit for us. But yeah, that's that's kind >> I want I want some Bitcoin deep back protection. I want some I want some deep back protection for my portfolio, Marco.

>> [laughter] >> Okay. I mean, we we can we can definitely do that if it's in some of the positions. We are thinking of some good high yields that we have currently that are on yearn and on Pendle. So we have a Pendle input type implementation ready. So some of the nice, you know, fixed yields on there. I have seen some some Bitcoin products as well. We actually have one listed on our testnet that people can play with that they can see the hyper BTC the bundle version.

I may look and you can you can have your Bitcoin D peg protected and get around 2% yield still or 1.5 something like that. So, that's something for the Bitcoin holders out there. >> And those are obviously that's obviously for like wrapped versions. >> Exactly. >> Yeah, yeah. Yeah, we are EVM based. So, we have a deployment on on base on Ethereum. We'll be slow slow launching other things, but yeah, that's EVM based. So, wrappers. >> Got it. Fantastic. Marco from Tapioca.

Thank you so much for joining. Fascinating as always to to just continue to learn how we're you know, making the stable coin super cycle a little bit more sustainable and safer with some good yield. So, really appreciate you joining today. I'm glad that we can make it happen and wish you the best of success in the near future. Thanks so much. >> Okay, perfect. Thanks for having me. Take care. >> All right, we'll see you soon. All right, guys. We're going to keep the show rolling on and get a couple more of our markets and news updates live from the roll up.

And so, there is a couple more things that we're going to be chatting about today. We've got someone who actually pinged us and told us about this chart. This is actually from an ex-Uniswap employee. Figured it's pretty relevant since we had Katie on the show. Let's go ahead and pull this up. When it's ready. So, this is an ex-Uniswap employee is what we're being told. Um fundamentally buyback and burn extracts money from token issuers and gives it to ecosystem holders.

Every token launched has a negative TWAP with all the spoils being taken out of the ecosystem. This cannot continue. Pretty damning coming from an ex-Uniswap employee. Observe on the chart when the Uniswap fee switch turned on. Let's scroll down. When we can because there's just I mean, these guys are just back and forth back and forth. I mean, these are the two leading decentralized exchanges. It feels like we've got a massive consolidation on the market. And so, obviously, and I saw you guys in the chat as we were chatting with Katie.

Um that Marvin Marvin Fluffo fantastic name says that Uni has the Robinhood partnership. That they do. It does certainly seem as if, you know, Robinhood is uh you know, prioritizing Uniswap over some of their, you know, other decentralized exchanges. Um and so, you can see here that, you know, you've got Uniswap V4 V3 V2 um all here. Uh and so, this is, you know, cumulative volume here really on the Robinhood chain DEX volume. And it's uh I mean, it went ballistic in the first few days of July and then kind of tapered off there.

Been declining since. And so, the tweet here is saying how um you know, this decline corresponds with the uh the fee switch getting turned on. I mean, this could just be a result of cash cat declining. You know, we'll see. But I I do think that there's certainly something. You can't just arbitrarily raise fees and then expect, you know, no kind of user activity behavior, no user behavior to switch. There is going to be a switch here. More fees means that bottom lines tighten, they constrain, and then that lends itself to [snorts] switching, especially when there's a new venue alternative available.

Um and Aerodrome has yet to uh launch on mainnet. Uh and so I'm very curious about when they are going to launch on mainnet. Because I think that is when we're going to see quite a bit of uh shakeup in how the the market share of the decentralized exchange volume lasts. Leo, let's go ahead and scroll down some more. I think we've got, you know, some some noise that people are making in the comments. Uh I saw Hayden respond.

So, we must fundamentally rethink how issuance protocols interact with their underlying infrastructure. If the infrastructure is not made for the use case, then then new infrastructure needs to be created. Uh Austin is just pointing directly at DEXes. Hayden is saying that this is conflating correlation with causation, saying that uh you know, you see the decline in Robinhood volumes that has nothing to do with the fee switch getting turned on. Volumes have natural fluctuations, nothing to do with the protocol fees. Austin responds, saying volume has definitely has natural fluctuations, never said they didn't. Personally think there needs to be more conversations with how the protocol fee is captured.

It requires selling tokens for UNI, which puts negative pressure on token issuers. Ah, I see. And so that is a fundamentally different tweet. Uh Austin is saying that uh the fee switch is actually going to be selling off the tokens. Pretty pretty interesting model here, you know, this does put downward pressure on extra downward pressure. People are going to be selling, going to take a fee, you're going to get that token, you're going to sell even more of that token. This is going to take place for all sorts of transfers. Downward pressure on every token except upward pressure on Uniswap.

Uh and so uh yeah, Hayden does point out that this is fundamentally different claim than what is in the original post. On the other claim, protocol fees are tiny relative to overall volumes and liquidity just a few basis points. Yeah, maybe five basis points. Um Katie on the show today made the point that liquidity providers are going to feel that. Ultimately, the market is going to be the arbitrator. People are going to vote with their capital and uh we're going to see where volume ends up. Is it going to be on Uniswap or is it going to be on Aerodrome?

We're going to see the DEX wars play out right before our eyes on mainnet uh in I believe just a matter of days to weeks. I don't know. Rumor mill said July. So, devs are working hard, I'm sure of it. Guys, just one more thing that I want to pass by you. Uh this comes directly from the Arthur Hayes article. I read it this morning. It was posted last night. Uh it's all about AI and it's also about the way in which credit is being created uh with Kevin Warsh as the Fed chair and Bessant as the Treasury Secretary.

Um Arthur argues that uh there is more credit that is getting created. Uh it will continue to get created. They have found a mechanism through which they are able to create credit. Uh Bessant and Warsh, that is. But the claim in the broader part of this article, not the part that we have on the screen here, but is that uh they are going to misallocate that capital. There's going to be a deceleration of data center build-outs uh by the hyperscalers, but we're going to continue to allocate credit and create credit for that build-out. But, that credit's never going to get spent. It's actually going to find its way into the crypto economy. And, crypto's able to sniff out this greater credit when it's just sitting there latent in the

economy. Um, Arthur is signaling that, you know, Bitcoin still has got the strategy, you know, shenanigans weight holding it down. And, so his call is on ETH. Um, don't tend to trust Arthur's altcoin calls these days. Feels like he's bought and paid for. But, when it comes to the majors, uh, I do think he's got some interesting opinions. Uh, rough price target for ETH by the end of this year. Guys, it is August. It is month eight out of 12. That is like I mean, it's less than half the year.

It's like 30% of the year that's left. And, his price target is $5,000 to 2.6x from the current levels. He likes this trade because he can strap on a significant amount of notional to this trade and still feel comfortable the risk uh, because he thinks Ethereum is Lindy enough that it's not going to be There's not going to be some technical exploit of ETH uh, that is going to lead to some 75% drawdown. It's also liquid enough, uh, that um, it's also liquid enough that he can get in uh, for significant percentage of Malstrom's portfolio and he can get out in minutes if he needs to. Uh, he says, "Finally, I will also sell out of the

money puts to earn extra yield and be comfortable with the risk that ETH trades through my strike and I have to buy that bargain prices." So, boy, oh boy, very very very very just fascinating times with Arthur calling 5K for ETH by the end of the year. I think ETH is higher than it is today by the end of the year, hopefully. Uh very, very soon, uh our portfolios could use it. We are long Bitcoin, ETH, hype, and Zcash, uh near as well, closely behind.

Um And so, man, if we get ETH to 5K and Bitcoin is just so sort of just tossing and turning, we're going to get I don't want to call it I don't want to say it alt season. Wow. Um Yeah. All right. Chain is fired up. You guys know the vibes. Uh New Type knew this Robinhood chain was going to be a flash in the pan. We've seen the story so many times. It's literally just a meme coin launchpad rotation all over again. Yeah, which to me is a very interesting aerodrome because, you know, they got base dialed in and they're going to get mainnet dialed in. We obviously know me

you know, Ethereum mainnet is not the the the meme coin rollover launchpad that we see time and time again. Uh Freedom Guy, you're the man. New Type, you guys rock. Uh Never miss New Type definitely catches Never misses a trade. Never lost any money in crypto. He's a genius. Uh New Type lost so much, but hey, I'm going to make it back. Rob, what's the TLDR of that article that Matt from Van Eck wrote? Uh the TLDR is that the AI buildout is more sustainable than the railroad buildout. Uh Arthur actually makes reference to the railroad buildout in his article as well.

Uh Matt from Van Eck basically had all of these stipulations as to why the railroad buildout was unsustainable. It made up such a significant portion of uh GDP. It was also financed by the government directly. And the AI buildout is financed by the hyperscalers. These are private companies. Uh the market would take their stocks down if they didn't believe in the returns of CapEx. They could trade that in real time. They could be more nimble than the government. The government, uh when they print these bonds, they print the credit in order to finance the railroads, it was much less sustainable, it was much less agile in order for them to pivot when it became time for them to adapt their strategy of

how they financed this capital expenditure. Uh and so, Matt from VanEck was effectively saying that AI buildout is a lot more sustainable. This thing still has a lot of room to run in the equities market. Uh and how that's positioned hyperscalers, nodes, data centers, basically just saying that AI is continuing to go. Obviously, you know, there's a lot of contentious debate about how this is going to affect the crypto markets. People Some people are saying that we need the equities markets to contract in order for us to get a rotation into crypto. Others are saying, "Hey, you know, we kind of got our correction, the V-shape recovery, it's off to the races again, more you know, getting a wealth effect, more money in the equities markets means more

money in the crypto markets. Uh it's just more money for it to go flowing around." Um I do think that there's a little bit of a nuance here. Uh and you know, I encourage people to read Arthur's article cuz I do think he's he's knowledgeable when it comes to macro, and he's effectively saying, "Look, you know, we're going to get a crypto bottom when there's an AI deceleration." And I think we're actually already starting to see that. It's not like as clean and correlated as you might think, you know, equities AI equities go down, Bitcoin goes up. These things aren't inversely correlated. It's just that as liquidity starts to decelerate in the AI equities, that's when Bitcoin starts to sniff out and react to that kind of liquidity, and

then you start to see it outperform. The first tweet that we covered today was the ratio between the Bitcoin and S&P. And that was starting to wake up. And so, once you start seeing more signals like that, it's when you do understand that there is sort of this rotation playing out. I do think that the rotation can play out and AI equities can still go up. The question is for how long and how strong. And if Bitcoin is going up more, why wouldn't you just be in Bitcoin or alts because these things haven't pumped, that would be early to the trade, whereas AI equities you would be late to the trade. Why would you try to catch a blow-off top when you can be early to the next trend? So, this is uh

this is kind of the mental math that we're thinking through on this show. Um that's going to be about it from uh me today. And so, we're uh we're uh transitioning to this pre-bull phase. And uh it feels like we're in it now. It feels like I don't know how much lower we go. Maybe we do make one leg lower, but I doubt it at this point. I just don't think it's going to happen. Uh I think we're going to continue to chop. I think the equities market is going to just do these like very volatile like kind of blow-off tops. People are going to think it's all over, but it's it's not. We're so back. We're going to keep going up, and then ultimately we're going to get this rotation trade into crypto. Uh and so, that's kind of what we're betting on. Uh it's just, you

know, no leverage, no perps. You don't need to time it. We don't know if this apathy is going to last another 2 months or another 4 months or another 6 months, right? But at some point, uh you know, the trend reverses and uh we're going to uh Yeah, we're going to we're going to get in there. So, that's what's happening here. Uh let's see. Aton said, "ETH to 5K and we're all getting double meat protein." Oh boy. >> [sighs] >> Pause.

That's it, guys. That's the That's the uh the end of the show. Our quant is talking to us. He's talking about Zcash. And uh yeah. So, New Type says, "I actually have a short limit order at 5:30 chat. Will I get wrecked?" Oh, boy. I don't know. I don't know if I would be shorting Zcash right now. I kind of think this thing does well regardless of AI turning over. I think AI equities are actually going to go through a blow-off top. I think then they're going to roll over. And by the time they roll over, Bitcoin's going to be doing quite well.

But I think Zcash can actually outperform Bitcoin because it's got the sovereign money crypto deflationary, you know, debasement trade thesis and store of wealth and at the same time it's got like the privacy quantum resistant, you know, AI takes over, you know, the world. Well, Zcash is kind of the safer option. You know, at least that's kind of kind of the momentum and the narrative right now. So. Um yeah. Oh yeah.

We're long ETH, we're long Bitcoin, we're long Zcash, guys. Also gold. Have a little long on gold and it's up 5% today. So, we'd love to see that as well. Guys, I'm signing off. It's been fantastic show with you as always. Stay tuned for a ton on the streets. You guys are not going to want to miss that and we will be back with a clarity special. We're going to have definitive definitive say tomorrow on whether or not clarity is real or if this thing is just if the if this thing just is just not happening. So, don't miss it. Fantastic set of guests for tomorrow. We will see you same time and much love.

Stay long. Stay strong. We'll see you tomorrow. >> [music] [music]