The Next Bull Market Is Upon Us (How To Position For Success)

Transcript

Some people call me Iceman fighting at the little corner. Dan Masheski. >> People want to complain about like the strengths of whatever [music] the business is. That's like a pure way to do it. And like their only risk is that they run out of money before they can get it done. We live in this world where stuff's moving so fast. I think we lose sight of like the idea like it's just like the streets of Manhattan. I'm going to keep this quick. Over 70% of our viewers are not [music] subscribers. Yes, you. Every week we interview some of the best entrepreneurs and [music] investors in the financial industry. The easiest way to support our channel is to hit the [music] like and smash the subscribe button. Now sit back, relax, and enjoy today's show. Dan, great to have you back. CMS Holdings, big fan OG.

And you know, we got the CPI print today and well, here we are. There's no news. It basically exactly what we thought it was going to be and everybody calm down. >> Yeah. I I hate these periods in the market. like it's just you're you're beholden to a bunch of information that you don't have any edge on and like people are like all wound up for like no reason. Uh it's just it I could do without it. But I we're probably it's probably going to be the norm for a while. Um especially like as people get worried about like things sort of like moving outside of historical ranges and then like obviously we have an election cycle that's got to like play out over the next couple months. It's it's kind of going to dominate the headlines. Um it's a lot more fun when like the

idiosyncratic price moves are just like driven by some underlying reason with like the asset. Um yeah, but it's just it is what it is right now. So we're beholden to it and we got to just like run with it. >> Yeah, it feels like external forces are kind of the driver right now. And like you said, we don't have you know the the edge is that that's another person's game. But something just occurred to me which is like you know typically it's like buy the rumor sell the news but with this current stuff it feels like a lot like fear-mongering and it's actually like you know the bare it's the bearish sentiment it's it's the opposite. It feels like it's you should be buying the news when it actually happens and it's not as negative as people like originally forecasted it to be. We just rip higher. But the fear

suppresses the market in the meantime as we're waiting for the event to unfold. >> Yeah. It's just hard, right? because it's hard to know like in the market in aggregate like what people's level of fear is. I mean you used to back before PERPS got bigger the financing used to be a pretty good direct indication of like sort of what interest level of fear in the market was like that's that's like really not a thing anymore. Um at least directionally like we found that there's not as much edge to like gleam out of it. You get it on the alts just because they can be wound up and pushed a little bit farther but like aggregate funding for like Bitcoin and ETH isn't going to like give you a directional side into like sort of people's like bearishness or not. It's or at least it's not as predictive going forward

because it used to just be >> interesting >> when it was just BitMX. Not that it was just BitMX. When BitMX was like the entirety of the market, like the funding would be negative and you were like you can just get long. Like it was like kind of like a brain dead signal. It didn't happen a ton. And then when the financing would be like annualized over 30%, you just get short because like it was automatically going to like converge. It just like could show you that the leverage was too pushed either way and that people were like feeling too too strongly in one direction or another. But that's not the case anymore. Um, but that was like the best market sort of heristic we used to historically have. It's harder now at least. I think it is.

>> Well, I think one thing changing sentiment, >> Dan, that's interesting is actually looking at the total OI of the altcoin complex versus Bitcoin >> once that threshold kind of flips. So, the total OI on alts surpasses Bitcoin, you know, you're kind of in a >> I mean, just a speculative environment, right? Whether that's the end or the beginning, it doesn't really tell you, but you know that the tides have shifted as far as where allocators are trying to get, you know, outsiz returns from. >> Well, yeah, allocators are speculators. >> Well, yeah, right. Exactly. But you're right. I the aggregate open eye of the alt complex like is a pretty good signal. Probably like I mean you saw it right in a 10-10, right? Like it was like basically at the

highs and it just got >> Yeah. >> wiped. But >> what are you looking at now, Dan? What's your what's your kind of read here? Obviously, you know, we're up off the lows a significant amount. We just got through the CPI read. Obviously, I'm bowled up because I smashing ETH longs the last couple days. People are hating on ETH. It's like the worst token in the world when it's literally like the best L1 smart contract platform in the entire market. Um, it's it's been a layup. It's been, you know, kind of consolidating here. Stronger than Bitcoin. ETHBTC looks great. Where we at, Dan? like what what are you looking at to get to get actual signal on kind of the broader picture here?

>> Yeah. So I think there's a couple things like one is there's like a basket of outperforming names um that's continued to outperform and I think that's a pretty good proxy in the market of like whether people are like d-risking um right so like it's it's hype lit near Zcash uh VVV what do you like what do you technically call VVV like what is like is that that like how okay um because I was like do you say it's Venice AI I don't know um anyway like that basket like if people are continuing to bid that like on dips and like that sort So strength that that gives the idea that there's money sort of still flowing I think in um that so that's like one proxy as long as like the winners sort of keep being bid that's like an interesting one. I think like the bigger

one though is just you you unfortunately have like equity market sort of driving things in the short term here. So like really just paying attention to like where that's going. Not that you're going to like predict where it's going but just seeing what it's doing on a day-to-day. Um, and this just like drives more into the macro thing where like crypto like doesn't there's not enough flows inside of crypto just unique to crypto to sort of drive it still in my opinion. Like I I don't think you've had like a lot of people like raise like follow on funding. I don't think there's been a lot of like new funds formed. I don't think there's been like a lot of people like raising money. Um, so and retail is flighty like it sort of comes in in pockets but uh there hasn't been sustained inflows for

like a really long time. So, like that's that's made the market a little bit sort of on its own. Um, like not being able to like support itself on its own. Like there's not enough money flowing in to be like, oh, like if equities are 10% off, which would be like catastrophic, like it's fine. Bitcoin and ETH are humming because there's like inflows coming in. The DATs were like really the last time like we sort of had that um I actually think the DATs have a resurgence here where like if the markets stay up No, no, they should, right? Because they should be able to like a raise like they should trade with a beta to the upside. Um, they also trade to a beta to the downside, right?

Like that's like the big problem with them. I'd like to see those things consolidate and then like start trading at a premium. If they like consistently while they're like raising capital to like continue to like buy the underlying, that would be material. I think that'd be like a big signal in the market too. >> Yeah. Yep. >> Speaking of DATs, I mean, we were talking about Tom Lee and Bitmine a little bit before the show. I just found the chart and you're right. Uh, the rule of the 10 best days and uh, you know, Tom says this applies to Bitcoin, ETH, and equities. Basically since 2014 on average the 10 best days of the year have returned 162% of the market uh and then this is on Bitcoin since 2014. Then the other 300 and we know how you know how much Bitcoin has gone up you know

since 2014 but the other 355 days of the year goes down 14% on average >> each year. So just I mean incredible. And then and then like you said, you know, time in the market beats timing the market because you don't know when those 10 days are going to happen throughout the course of the year. So do you do you kind of you know you agree with this? Do you follow it yourself? How do you just how do you incorporate it into like your style? >> Yeah, I think you want to be allocated like I think you just want to be long in general. I think that's like in life just sort of like a good sort of way to go about it. Like I don't know it just like tends to work um like over a very long time horizon. Uh, so I think that's

like the general takeaway is just like own things. Um, I don't know like don't >> don't get super worked up on like picking the exact pico like bottoms of things. >> Um, I think it's also like what causes a lot of anxiety in the markets is because like there'll be like a big move up like today and like people aren't participating in it and they lose their minds. Um, I think that's like part of the problem because like so much of the return is generated on outside days. Uh yeah, I look I think the general takeaway is like you should be sitting on your hands and you should just be like owning assets like more than trying to like trade every like little idiosyncratic move of it.

>> Yeah. >> Yeah. So Dan, on this note of kind of the winners here, right, if thinking about this kind of spending time in the market, um you know, we didn't play the top perfectly. We got some really good advice from, you know, just Wales last year, end of last year that, you know, there could be an earlier top. So, we were able to kind of get out, you know, not in full ever, but Robbie and I had a decent bare market. Like, I think maybe took a 20% draw down from portfolio alltime high in the bull. And I didn't I didn't really play around in other markets. I kind of got smoked on a uranium trade, but then I I made it back and I kind of just sat on my hands. And Robbie did the same. And Robbie just kept kind of like, you know, allocating,

allocating allocating. >> The DC. Exactly. And then through this, Dan, we started to uncover these winners kind of like sooner than the rest of the market, I guess. We were in hype, you know, from like the 20s, 30s, 40s on. Uh we were in Ze, you know, 400ish and we're still holding a lot of these. We were in Venice, you know, around like the $10 markish. Obviously, you can't play all these, right? And so we started to see this and we started to kind of like develop this portfolio theory of like the winning portfolio for this bull market is this barbell. And this barbell is storev value assets that are highly correlated to what's happening with the macro environment. Bitcoin, ze, you can put gold in there. You can put ETH in there. These four, we think, are going to be highly, highly receptive to things

like what happened today with the CPI print. It was hot, but maybe not as hot as everyone thought. Boom. Ease up 10%. Zcash ripping, right? Bessant buys more bonds. This is kind of like your fiat debasement side. And then you've got these onchain businesses that are kind of like printing money and returning it to the token holders or doing some form of buybacks and a lot of the names kind of that you mentioned and then you know I know you're a big investor in you know some of these kind of like newer era blockchains too monad etc and they probably have a place in there too right and we did a lot of seed deals that are zeros so you know I'm not one to really talk here but we kind of came to this idea that I don't want to allocate any of my capital into anything that's not

in these two buckets. And obviously we're getting a bit more speculation now. You got some memes, etc. But for the sake of like spot, ride, size, buy in the, you know, in the beginning part of the bull and try to, you know, trim out exits. It feels like this is what makes sense to us. What are we missing? Like what are we wrong about? What how should we think about allocating here? Do you agree? Yeah. >> I don't think it's I don't think there's wrong, but I just like it's the one thing to watch is like it's crowded, right? Like this is like basically everyone's paring the same narrative now. Um doesn't mean it's wrong. it's been right and it's gone through, but like you you do have to like watch that like if everyone's in the same thesis, then it sort of starts to like crowd out

the edge of it. That's like just the only thing to be concerned about. >> Okay. And so is that like a midbull cycle thing, a late bull cycle thing? Is that already happening now? Kind of like how's your >> See, that's that's that's where all the money lies, right? Like >> you're I mean you're the fun manager, man. I'm just a podcaster. Like >> that's if you do that, you got the whole game, right? Like that's always the hard part. But right, you got to you got it's hard. You got to like think back historically too, right? Like there's like been other periods of time where people are like, "Oh, like this is like clearly the future like this is like the basket you own and then like it does like really well like through the whole cycle and then like all right remember 21, right? What was it?" Yeah. Yeah.

Right. Like that was everybody was patting the table and everybody was loan the whole basket and then like it obviously unwound violently. Uh, and like Solano was able to like recover and come back, but you still like you basically eight zeros on the other two-thirds of the book. So, it's just it's something to be like cognizant of is like if everyone's in the same thing and then people do hit the exits, like you get hit hard. Um, just it's the only thing to be concerned. It doesn't mean it's going to be wrong, right? And they can keep compounding and they keep going and like sort of if there's incremental part of the problem crypto has is there's not like equities have constant flows, right? Like there's always new money flowing into equities. Like you have to structurally own it in the US.

like we have like an entire complex of like investment products for people's retirement that like are predicated on like money moving into equities. Like this that is not true for crypto. Like there's not like the whole asset class can like shrink or grow depending on like how much like inflows or outflows there are into it. Um so you have a little bit of that problem where it's a contained pool of money um for like periods of time. So like if it's all sort of everyone's in the same things and like the whole thing contracts like those will contract the hardest. That's like my biggest like thing to just be concerned about is like there's there's a lot of crowding inside of like crypto names and books. Like I would bet you every liquid fund manager is like long the same basket of names at this point.

>> Yeah. >> And it's worked. It's good. It's it's right. It's not necessarily wrong. It's just like something be if things do turn then like everybody suddenly scrambles for liquidity in the same names. >> Yeah. >> Yeah. Do you think there's any element of like as we continue if these names continue to compound there's kind of like the the rotation hey these things already have had so much price appreciation I'm going to buy like the second to the and like you know lighter doing extremely well kind of the second to the hyperlid like those who haven't quite ran yet you know people flood into those because the other ones are already up so much >> yeah I mean that's a dangerous game to play though but yes it does happen but I would say in general people shouldn't try to like you shouldn't you shouldn't not own a good name

because you think the second name might have a beta move, right? Like I understand the logic to do it, but you're basically playing this game of like expecting where you think other flows are going to incrementally go. So like I would Jay in general just like don't do that. >> I would I I agree with you and I think once we start to see that happen more and more that's a signal that we're getting later and later stage. >> Yeah. No. Yeah. People definitely start like violently like moving between sort of stuff. Yeah. People just start speculating more. >> Yeah. Yeah. So Dan, >> well it's a function of like incremental capital coming, right? Like if retail suddenly starts coming in in like earnest, right? And they're just like sort of just they're much more likely to play that game, >> right? Exactly. And it's kind of a

signal or indicator that retail it's retail flow rather than stickier capital that is leading that charge if we see that play out. >> Yeah. >> Yeah. One of the funniest things on the vein is like anytime there's like positive news for Ripple like you always want to buy Stellar and it's like it doesn't you're like this doesn't really make any sense and you're like yes but it's like it's Ripple but cheaper and like it just >> no coin pumps. >> Yeah. >> Well no there just been a g like it's this beta trade that like doesn't it shouldn't be there but it is every time. >> Right. And it's like >> right but cheaper and then people start paying attention to that and we kind of lose sight of FDV and circulating valuation and >> Yeah. Yeah, [laughter] like if the headline is like >> Garlic House like cures cancer, like you

want to buy Stellar and it's like kind of hilarious. But yes, that does like happen. >> So, I'd like to get into where I think retail is going to come into, which I think is actually more likely to be FOMO and social trading than it is dinocoins like we've seen in the past. But before we get there, I want to talk about L1's and Monet. But I want to talk about the next marginal buyer first, which is I think there's still a lot of sideline capital. So if I'm holding these names, I think there we're gonna get FOMO into like these names from, you know, crypto natives, liquid funds, etc. There was no private round for Ze. There was no private round.

>> No, that's not true. There was a venture round for Zcash. >> Okay. Sorry. There there was a venture round for >> Z tax. There was a 20% tax for I'm not trying to fund it, by the way. Like I'm this we're forget history sometimes along the way. Yeah. This was this was had a massive venture position in it. >> It was bootstrapped. Okay. I I guess the I guess more of the point is that it went through 10 years of hell and got left for dead, right? Hyperl had Z. >> Dude, >> there's a lot of stuff that's left for dead. That's not That's not an argument. >> That's not a thesis.

>> Most stuff is left for dead. I'm not >> No, no, no. I'm just I I want to make sure that like we're getting the >> the podcast is correct. Okay. Okay. Appreciate [clears throat] it. >> I'm going to push back where I think it needs to be. >> Okay. All right. So I guess what I'm saying is I think a lot of liquid funds miss this and crypton natives they miss these outliers that they've been bare holds which is fine and I think they're the next marginal buyers. Then I think you get smart high net worth individuals allocating to ETFs and larger institutional allocators kind of like down here in Wall Street and then retail. So that's kind of like my next marginal buyer profile. I think we're about halfway to the end of crypto natives being fully allocated. Like I still think there's a lot of sideline

people. Am I right? Am I wrong? Like I'm always trying to think about who's buying next and I'm just trying to think about, you know, what that may look like over the coming months to year. >> I would say it's you kind of can't like it's hard to figure that out, right? Like it's hard to understand like especially I think what gets lost a lot of times with crypto Twitter is like there's like really loud people on there and like some of them like have fairly large like positions in mit but there's like an incredible amount of money that just like is not participating in there like even in the crypto universe. Um, so like it's you can get lost thinking that everything you're seeing on crypto Twitter is like indicative of like where the flows are. And the only reason I know this like particularly is because

like I ran an OTC trading desk for four or five years through like 2017 which was in my still opinion like the greatest bull market we've gone through. Like the the amount of money that would be moved by participants that you have no idea who they are is like tremendous and it like dwarfs like the lit stuff that you're like seeing all the time. Um, so like that's like just like in that stuff you're never going to have like good visibility into. Um, so it's hard to play that game. I would say like the idea of like there being like institutional adoption of any of this stuff is like pretty still a joke. Like there's really not like people are not putting this stuff on balance sheet at any of like the larger sort of like places. Like maybe you've gotten hype in like a fair like number of like venture

books, but you do not see it in like traditional sort of larger allocators of capital yet. Y >> like the only thing that can make an argument that's breached that a little is like IBIT. Um, yeah, and like that's still taking a couple years to get that. So that like there's like a big tailwind of all of that potentially coming in still. So that that's and that takes a very long time to move. >> But that's like a multi-year thing. That's not like me trying to get out of my Zcash >> at like 5,000, [laughter] you know, in 2027 right? >> It still sounds like you think it's coming. Like what do you think is the obstacle to overcome? >> Time. It's always time, right? Like it's like it just it takes people get used to it and we we live in this world where

stuff's moving so fast. I think we lose sight of like the idea like it's like it this goes back to the conversation we're having like about you talking to your kids at like pickup and like the stuff like they're discussing like it's just they're not like plugged in like if you showed them the FOMO app they'd be like the [ __ ] is this like it's just like it's completely foreign to them. So like for them to just get comfy with like owning Bitcoin is like taking a very long time like let alone like ETH and then you'll be like here's Salana and like here it just it takes time and like it it's all like working slowly and happening and like I'm less pessimistic than I think your average sort of participant when you talk about where I think it's like all happening. It's just

people's timelines are so short. It it's funny that you mentioned though ETH and Salana because that that was sort of the gap that I think we were missing in this barbell thesis like the Zcash Bitcoin hard >> money and Salana it's like >> but everybody well ETH has been hated on for a very long time so but like Salana was like the only thing you should own last like two years ago right like I'm just saying like people people change their mind minds on this stuff like very quickly >> and so yeah you think that this is going to continue and like there is like there is [snorts] kind of like still catalyst and momentum in these things. Even though frankly from like the cryptonative standpoint it feels like

it's like we've played that game. It's been ran through like from the outside looking in the institutions still haven't really like that tailwind still exists because it's a it's a much longer game. >> Well, we got into ETH at what $50 in 2017 and saw soul at a$150. So now it's just like you know what I mean? It's it feels like They're also big assets now, right? Like they're >> right >> 100 500 billion sort of dollar assets. Like they don't move. They're not going to triple on you overnight. >> So I think that's like part of also like why people are like crypto Twitter's like level of like risk tolerance is like this is not interesting to me.

>> I guess I Yeah, that is true. >> If you like be like if you're like Yeah. Well, no, it's true. If you be like Bitcoin's going to go to 100,000 people like I don't know that's like a 20% like that's not really that interesting to me. But like it's just it it's so had it just like a different pool of people, right? But if you go to like an asset allocator who's like running a couple billion dollars and be like we think this thing can do three and a half% over equities for the next 5 years be like all right that's great like I love that. It's just a different world. >> Yeah. >> And so I guess what my question is to like put it succinctly. I don't really see the the you know thesis for like an ETH or Salana or like you know these

kinds of things because it feels like they've got caught in the middle but maybe the cat and maybe they don't need one. Maybe they don't really need like a real thesis or catalyst other than like look there they are of a market cap and of a size where there is some institutional money that is like capable of deploying them into because they don't see it as risky. >> Okay. So what you're telling me right now is exactly the other side of the coin of where I saying when you want to tell something's crowded, right? Like if you want to tell something's not crowded, it's because nobody can figure out a reason why you should own this thing. Still this evaluation. >> I like it >> because they're valuable. They have Look I >> I've had this conversation definitely, but like this happened um this happened

with BNB, right, when it first like hockey stick up where CZ was like, "We're going to do IEOS and you need to have B&B to do it." And like suddenly B&B had this like moneyiness to it where it was like you needed to do this thing and it rocketed. ETH had it with ICOs and then DeFi because it was like the asset you were basically using like inside the system and then Salana had it because it was the reserve currency to trade like memecoins and there was so much of it getting locked in like these like pools. These L1s in particular have a lot of like surface area of like where the native asset can become like incredibly useful. And I think that's like ultimately like what you're buying.

Oh. Oh, that just made me so bullish. ETH, >> so I couldn't They have value for a reason. >> Yeah, I absolutely agree. I just couldn't really put my finger on it. >> But then, Dan, look, I don't want to own and I nothing against these names. Suie, Aptos, um, a lot of these L2s, Optimism Token, um, a lot of these names that even supported the channel that I'm not going to name. Like, I just don't want to own these names, right? I mean, I would even argue that Monad is a tough name. So, like what's the Monad thesis here?

Like why is Monad a buy? Why is Monad a hold? Like why are you so bullish? >> I think they're going to consist consistently iterate on the thing until they give some value acrruel mechanism back to the token and I think they're just like going to do it forever and like their only risk is that they run out of money before they can get it done. >> You know, a couple of names that um >> they do and they could go raise more probably. I'm just like I and they're I think they're going to incessantly keep trying to iterate on it until they like get it somewhere. >> But what about these other L1's and L2s?

Like are these >> They all sort of have this Well, it depends, right? Like they they all have sort of the same risk, right? Like your risk is that the founding team gets fed up and no longer wants to do it and like there's just attrition or like they actually just like run out of money and then like there's nothing really sort of supporting it, right? Like those are like the two ways that these things sort of like die. But as long as like like look at Ty, right? like he's on Twitter constantly and the guy is involved in every asset of the thing that I can seemingly see, right? Like he cares about every project on it in some way and he's like life mission is to like make he doesn't have to be doing that anymore. Like there's the guy's got more money than God. Like he doesn't

need to be like in this thing but he's incessantly going to keep iterating on it and I think that's like a value prop for Salana like long term. >> Yep. Yep. Okay. Yeah. Yeah, this is my and like it people get people get very concerned because they can't immediately see like where the value acrruel comes in. But like this was the same argument people made about ETH for like the first year of its life where they were like why do I need to own the asset? I can just do smart contracts like I don't need to like actually like use the native token for anything and then like you had this ICO boom and like suddenly it hockey stickicked up like tremendously and like it gained some like money like quality. So >> I don't know. Yeah, >> I just like I'm a little broader in

scope of what I think these L1s can like >> accomplish to get value back to the token. >> It's it's funny though what you mentioned about the moneyiness too, like ETH kind of had that as like the base asset for ICOs and then DeFi to a lesser extent. And I'm curious what you think about this because ETH kind of did it in like a decentralized format where people sort of defaulted to that as the native asset. There's other companies that do this a little bit more directly like chain link. just curious like do it in a more centralized way and I think everyone is aware that you know they were they had a whole BD team they were going out closing deals but the whole thing was that they made you pay in link so it wasn't program programmatic or anything but it was still using their

currency as a form of payment or money do you think those despite being more centralized have a do they stand a chance they have a case to make for moneyiness >> yeah I I think like the big the arc of sort of like crypto's industry over the last three or four years is that like we've just become like tremendously much more comfortable with like centralization and sort of like on a regulatory footprint and just like also as a user um with these things. So I think that's like a big trend that you're seeing where like people expect Salana to like do things right not like be a hands-off sort of like market participant. I think ETH has struggled with this in particular because they had such an ethos of the decentralization that they like don't get in the weeds and like sort not pick winners is like

the wrong thing but like get more active sort of in what's being built on the chains. Um, and that's like been to their like that's hurt them like longer term like versus like >> obviously when you first get started like so much of like the L1 is just like run by the foundation and like the sort of the team that built it and like over time you try to like decentralize it but we've gotten incredibly more comfortable with like I mean hype's a great example of this, right? Like I mean it's effectively centralized but like we're very okay with it. >> 24 nodes or something. >> Yeah. And like everybody's very comfortable with it. >> I I think so. But it's a great product and like we're okay with that sort of like trade-off.

>> Yeah, I totally feel you. I thought it was And dude, this led to this led to this abandonment of the space and this kind of like um there's a term for it. It's like you this identity crisis, right? Where it's like we built all of this for this world, all this products, no one really used them. All right. Well, [ __ ] We better build something that is going to get used whether it's centralized or, you know, quasi decentralized, whatever. We got to like do something. Stable coins, tokenized assets, per prediction markets, right?

all these things kind of like stemmed from this like identity crisis era almost like the last two years man has been even in the bull even last bull people were just kind of fed up with all of it you know and so um yeah I mean I just want to close up the loot the loop um on the kind of like the middle trade so I put the L1's the L2s in there's also like bridges and like >> bridges >> zk and like uh interrupt and you know uh name your kind of in for a stack that's like crucially important to the whole operation of what we're doing here but like makes no money has a market cap between 50 and 150 million they're kind of you know gone through their unlocks

or they're close to the end now what happens to them I think it depends right it depends on the team and if they want to continue to like iterate on it if like they want to keep moving forward and building like new functionality and products it really like it's a it's a lot of these like you have to remember like I think we forget because like there's a price on this stuff and we kind of like treat them like larger liquid sort of like companies but these things are basically startups and like they they should be pivoting and changing what they're doing like constantly and a lot of them have and a lot of those successful ones like have like is a great example of that right like that thing did not start out as a >> RWA asset sort of thing like that was a

god when we first were doing it it was uh they had like I think it was a way to like hedge IL in like LP pools and they just like completely changed it on a whim, right? And they it was a great sort of pivot. So if the teams are willing to like see it out and that be like this is a finished product and they continue to iterate, you want to like own those teams and you want like the upside on it. >> Yeah. >> I got I got torched a little bit because I said those teams that are still figuring it out, pivoting and you know should be pouring all their money into growth shouldn't have tokens. Do you think you know they should have do you think they should have a token in the liquid market if they're still in the figure it out growth mode?

>> Yeah, they shouldn't. the pro I think we are [clears throat] past like that. I mean like we're probably like at fault for some of this too cuz like we would just invest in anything with a token but like that like has probably got to stop like I mean we see like there's no there's no interest in it anymore, right? Like it is Yeah. We're working through the tail end of it. >> Yeah. So Dan, I'd like to just get to the fun stuff, man. I mean, we I really appreciate the whole kind of portfolio thesis and market theory here, but dude, we're pairing memecoins with stocks on Robin Hood shame and pumping the [ __ ] out of single name equities on the stock market, pissing off, >> don't do that. That's a that's a really bad idea.

>> Multi-deade long companies that power our movie theaters. >> What the Dude, what's going on? There's like a really f like I forget like how the exact phrase goes, but it's like when you finally like make it and you're like in the room with people, you like you need to act like you belong. And like crypto is just like really bad at this. Like we come in and we just like >> it's like finally like we're like having conversations with people and like doing things and then we just ruin it for ourselves. Like we just like act like children and we like you. It's one thing to be like [ __ ] around in crypto.

It's like a completely other thing to be like transcending that into like another market. Like we really we really not need to not do that for a while. Like we need to like know our role and like sort of play nicely is my guess. Like we should there should not be like 200% equity moves that are tied because of something going on like on FOMO. Like that's a bad that is a bad thing. >> Yeah, I think they figured it out for the most part. like it seemed like they had really low inventory during offmarket hours and then they arbed it back by minting a ton of the the stock once the market reopened and then then following weekend they just preminted a ton of tokenized stock so that you know they didn't have that low inventory and they were able to service that prices

didn't get super uh disjointed >> but do you think like because now that Robin Hood seemingly has a little bit of a sustainability crisis there's like lower volumes there than they've had since they launched launched. How sustainable do you think Robin Hood chain is? Do you think it's been like that juice has been squeezed and like how how how do you approach the whole tokenized equity thing in general? >> I think tokenized equities are just going to go straight up for a very long time and I and I think it's different actually than the reason you guys think it is. Um like trading them for like you and me like we can just go like trade equities, right? It's not like we don't really have to think about it, right?

You can just go on a Robin Hood regular and sort of trade it. Um, like there's value to having it on chain, especially if you can like plug it into like other components of DeFi. Um, or if you can sort of like just access it constant 24/7. Um, that that's like very useful. But what is incredibly useful with this stuff is there's an entire like portion of the world that like cannot purchase US equities, right? This is very much like [laughter] akin to how like Tether got really big, right? Cuz if you like look at Tether at face value, you're like, why do I need this? Like I can like pay people now. Like I can just use Venmo. Like it's like what's I don't understand. And it's like, no, like you're missing the force here. Like the there's a portion of the world that

wants dollars that can't own it. There's a there's an even bigger portion of like the world that wants to own Nvidia but can't own it for like a whole bunch of reasons. And if we can suddenly like tokenize that and like let it be a bear asset, that's like incredibly powerful. And it's also incredibly powerful for like US companies, right? Because suddenly you have an entire capital base like open to you that you can effectively like have without giving them really governance. Uh which is like super super useful. Um, so I think this is like beneficial to US companies and I think it's going to be gigantic. I think it's going to be bigger than stable coins. >> I mean, so I take it you watched the quick Vlad clip on CNBC of him talking about this because he was kind of squirming, right? And when he said what

you just said, the producers and the hosts finally understood. They were like, "Oh, okay. Okay. So, you guys aren't just like trying to scam public company CEOs by not having their stock be purchased on the actual brokerage where it actually helps them. You guys are opening up the whole TAM for these companies to be the global foreign investor base. Oh, so you guys are going to actually help us get more exit liquidity for the boomers who have been riding these stocks since their [laughter] inception. >> I don't think that's on anybody's thought process. >> Oh, okay. That's been the whole that's been the whole thing, right? Like people talk about the greatest export of the United States. We don't make anything here, but we export the dollar. Now we're extending that to the equities market. That is becoming another export

of the United States, our financial markets. >> Go look at the the Chinese equivalent of the S&P 500 over like the last 20 years. And it's just like it's flat. >> It's like it it's like incomprehendable how much better like owning US companies are for like compounding wealth. Well, because like China specifically doesn't like want to just be like giving money to like equity owners. So like they it's structurally there for a reason. It's not that the companies are like worse. >> So like that is like an idea of like what we're sort of like in the market exporting if this like works out and it will. I think it's going to happen.

>> It's a good narrative. We're exporting wealth creation. >> Yeah. Via Robin Hood change shitcoins. But what about >> the mecoin thing is just how you bootstrap it, right? cuz like you got to get people interested like day one and like this is like it's just a lightning rod and it's like a good like fast way to do it but it's it's it's really not an interesting thing longer term. >> Yeah. >> Okay. Then how about this kind of just broad stroke wave of the growth of tokenized assets. I think we hit 35 billion on chain yesterday. I saw a post from A6Z crypto. So we're at 35 billion now of effectively high quality non-crypto assets. Isn't like half debt though like like circles like

>> bond thing? >> Treasury. >> Yeah. Token treasury fund black rocks. >> But I guess what Amy might be asking is like you know we we anticipate that this is going to be a straight line up similar to what you said about tokenized like who are the who are the beneficiaries of that float of the chains. Come on man. That's the same problem people have with stable coins, right? Like until Circle got public, there really wasn't a good way to put that trade on. Um, okay. So, that's a good question. I think, and you're going to maybe you want to own the L1s they sit on. Maybe that's like where it's all going to come out, right?

I don't know. Maybe that's what I mean. >> Uh, yeah, the oracles probably have some value in it. Um, I mean, there's obviously like the issuers like that you can own. Um, some of those are sort of public to get into it. Um, I don't know. I think that's like the big question. I think that's like where a lot of money is going to be made is figuring out like who wins this stuff. It'll probably be a bunch of stuff that doesn't exist yet, too. >> Really? >> Really? >> Yeah. Why not? >> To me, part of the onchain business, not the hard money stuff, but the onchain business stuff was like that bucket seems to be benefiting the most from what I call the legitimization of the industry, which is like Trump saying hyperlid and like the CFTC hosting this innovation advisory committee and all

the industry leaders up there shaking hands. like the those guys in that room, their companies seem to be the ones that are benefiting from like quote unquote tokenization. >> Uh I don't think anybody's really like outside the stable coin sort of issuers is like really carved out like it's >> too early to tell. >> It's very early and I don't think anybody's like really doing tremendously well yet. Um, I think they will, but I think that's like where a lot of money is gonna be made is figuring out like what this like has like what are the knock-on effects of it.

>> Yeah. >> I mean like a right like a should I >> was going to say I was going to say a >> Yeah. >> Yeah. >> But like there's Morpho and like I I actually think the L1's will have like a resurgence there if there's like a tremendous amount more that has to like happen on them. >> So >> like trillions of dollars of assets coming on chain, stable coins, T- bills, money market funds, equities, etc. you know, they need to live somewhere, >> right? >> Yeah. And they go onchain. So, they end up in these onchain protocols and then the TAMs of these onchain protocols rerates and it's more activity, more TVL, more fees, more earnings, more buybacks. So, everything does well, but as always, question is outperformance.

>> Yeah. >> Well, this was like always the thing, right when All right. So like DeFi gets built but it's like really just for like existing crypto tokens, >> right? >> But like what if you now suddenly had like assets people were like looking to like actually hold for like longer term periods of time and not just like on a trade and like gave them the same infrastructure. I don't know. I think that's like very useful. >> Yeah, absolutely. >> Dan, I just wanted to kind of close out here and ask you about what you think social trading evolves into. Have you used FOMO yet? Have you downloaded it?

>> I have. Yeah. Yeah. [laughter] >> What's your kind of what's Oh, yeah. Duh. I tailed you on that memecoin. Um, Ch. No, not financial advice. Um, so where does this go, man? Because I've just onboarded a couple friends. I've sent them each like $4500 of memes and a couple of them have already tripled to quadrupled their account. They're avid chronic sports gamblers. Like I'm talking like every week, every day. I mean, I'm I travel with these guys and I wake up to get long [ __ ] coins. They wake up to place parlays. That's just what happens.

>> I'm far wealthier. I'm not trying to be an arrogant dick about it, but that's just how how the world works, okay? And so I'm like, guys, like, this is it. I mean, there is guys hitting 100 X's here. You guys need to be on this and you need to be thinking about it. And so I give them rules. I'm like, no deposits. I'm going to top you guys up. You know, I'm going to get you guys going. No deposits. Always be selling. Always leave a moonbag. Rotate your gains from low caps into higher cap coins consistently and build a foundation. start thinking about this as a portfolio, not as a one-time let me smash a plus 500 parlay. If it hits, I make a blot or if it loses, I lose it all. And so trying to, you know, zoom them out portfolio thinking. Well, we're

talking about memes here. Like this is so silly. But that's kind of my current experience so far. Just curious like where you think this all goes. >> It's clearly here to stay. Um I I think it like just is cannibalizing probably existing forms of gambling elsewhere. Like I think that's pretty much what it is. like it's a substitute good for like sports betting or on some casino game or I mean a lot of perks trading is just gambling too. So like it probably pulls from there. I I would bet you see like a decrease in a lot of prediction market activity is as social trading activity like goes up. Like I think they just like pull from there's just like this whole there's like these x amount of dollars that like people are looking to like gamble with every day and like it's it just gets split amongst multiple

things. Um, I mean I I personally think like sports gambling is probably the worst of it just because like it seems so stacked against you. Um, but like people can do whatever they want with their money, but I think this just like pulls people from it. >> Yeah. >> Isn't Isn't FOMO and Pump Fund like isn't it way more stacked? Like isn't it like 5% people make money whereas like the other things it's like at least >> 48 45% once you take the big out? >> Well, I think the difference Yeah. So I guess like the difference though is um like the house is like skimming way more in the sports or like world.

>> Yeah. So actually you actually do have >> so the house is taking less but you have a higher shot. >> It's more like playing the lottery than it is like sports game. >> Yeah. It's like more like a paramutual sort of like betting setup. >> Yeah. Yeah. Yeah. Yeah. >> I mean you should do neither if we're being completely honest here. Like I'm not like advocating one form over the [laughter] other. And like I'm not like being like this is like the proper way you should be like like you go into both expecting you'll lose money, >> right? >> Yeah. Yeah. >> Dan, awesome. We have anything else? >> Appreciate it, man. No, that was it. This was great. Appreciate it, Dan. As always, love to have you on again soon.

And uh yeah, thanks for spending some time. >> Awesome. >> Cheers, man. >> Thanks, guys. [music]