Should you sell your ETH? Fundamentals, L2s and Solana

Transcript

GM good morning welcome to the milroad show The Daily crypto show where we explain crypto like AI explains everything confidently even if we're not 100% sure I'm your host Jay Hamilton and today we are joined by Michael NATO founder of the defi report an industry-leading crypto newsletter and onchain data research analysis that they break down tons of what is happening on chain in a very detailed way honestly one of the greatest a access is research and resources out there we're going to talk about is it time to sell your eth Michael wrote a deep dive on the ethereum ecosystem earlier this week and so we had to get him on the show to break it down and talk about what he's

seeing and is he bullish or bearish on the long term of eth we're also going to talk about Michael's short-term Outlook Trump AI macro there's been a lot that's happened in the last three months that has really led to this leg up in where we are in the market we're going to talk about how does Michael see the Outlook short-term long-term for the rest of 2025 and why he's rebalancing the cash right now and then we're going to wrap up with some of Michael's highest conviction tokens as well we got to bring up we're going to talk about Venice and vvv token new token that just dropped earlier this week want to make sure you guys are up to speed on that before we jump in favor for you guys if you like this show wherever you're listening podcast YouTube if you could give us a like a subscribe a comment all

that helps us grow the show make it better for you and get better guests on in the future before we jump in we're just going to take a minute to hear from our sponsors meet odos the defi aggregator that makes your token swap smarter faster and a whole lot easier tired of trading like it's 2019 odos finds the best prices for your swaps across 900 liquidity sources and 14 blockchains so you always get more bang for your crypto Buck whether you're swapping setting a limit order or just avoiding gas fees like the plague oos has you covered it's like having a genius Trader in your pocket minus the coffee addiction join 3 million wallets already using odos to power over 6 billion in monthly trades start making

smarter swaps today at milroad docomo Michael welcome to the milroad show great to be here Jay I should say welcome back this is your your third time on the show but your first time where it's you and me because you've always been on with Kyle so excited to jam with you today yeah man glad we got the a team for this one oh ouch tell okay let's start with um just zoom out what are your thoughts in terms of where we're at right now uh kind of evaluating the past three months the bull that we've had so far and where you think we're going for the rest of 2025 yes uh quite a bit going on out there in the markets right now I think you know from

my perspective what I'm trying to do is really kind of assess I would say two things from from a very high level so you've got basically Trump and the Trump Administration coming in and there's some very like direct impacts to crypto there obviously with what's what what's happening with um you know a new SEC chair coming in you've got Hester Pierce was just appointed as the SEC uh division for crypto you've got uh the Strategic Bitcoin Reserve or stockpile and then you have like deregulation of the space and potentially new regulation for stable coins and and crypto broadly so you have all these direct impacts to to crypto that Trump is is bringing to the market and I think the we've essentially I think the market has been

pricing that in right over the last I would say going back to even probably like middle of October when it started to become clear that Trump was going to become the president or at least in the poly Market polling uh was winning you started to see crypto starting to move even at that point so so from my view that part of sort of where we're at in the market has been priced in what what maybe is the one outlier there in terms of what could push the markets higher is the Strategic Bitcoin Reserve piece which you know we did see an executive order on this and what it's basically saying is like it's it's going to be a a strategic stockpile it could have Bitcoin it could have other Assets in it

as well there's basically going to be a 180 day grace period where this uh team is going to come decide on what to do there so it's probably not going to be until sometime in you know June July where we get July 23rd is the 23rd yeah that's the date when the report has to be submitted okay so we won't know for sure what's going to happen until then that doesn't mean we we we're not going to see a big move in this area it's possible another Central Bank or something tries to front run you know the the FED here or the US here and that would potentially kick off you know a you know a move for Bitcoin so that's like the one out I would say was is like not fully priced in I guess you could you could say um with Trump that's kind

of how I'm thinking just about about Trump and what he means for crypto right now the other piece of this is just sort of the indirect impacts that Trump has on crypto and this is really through you know how his administration and you know basically what's going to happen with the broader economy and and policy and how he's going to get along with Jerome Powell as the FED president bringing in a new treasury secretary with Scott bessent um you know what does that mean in terms of like interest rates in terms of you know Global liquidity and the things that really matter for for crypto and so I'm kind of like looking at both of these things and then sort of peeling back and saying okay we've gone bitcoin's up 6X

or so from you know the the lows in 2022 I think salana is up you know if you go all the way down to the bottom when it was $10 or so it's up 28x or so you know you've got a bunch of other things that have transpired already this cycle with with mem coins with with AI coins um we've seen Innovation play out we've kind of seen all of the things that you typically will see in a crypto bull cycle that does not mean that the markets have peaked and I I'm not making that call right now um what I what I am saying is like I think it's a fair time to look at it if you've been in the market from the lows or even maybe from prior Cycles as well I think it's you know perfectly reasonable to be rebalancing the cash here and sort of

setting yourself up potentially for a correction you know Bitcoin is only had 13% correction so far in this cycle there's a lot happening right now with sort of this Trump transition and I think the markets are trying to sort this out we've got the dollar is still almost up at at 108 interest rates are still high uh inflation is still scaring people so there's a chance that we get like a you know sort of liquidity trap here and a little sell off and I'm trying to position myself for that and then be ready for um the rest of the year because I still think there's a number of you know bullish catalysts uh later later this year so yeah super interesting because I I I'm feeling very similar on the Trump side I I'll I'll agree with you that it feels like the

only so it feel it feels like Trump effect is kind of priced in we've had the trade right like that that happened basically as you said leading up to the election and it really kicked off once he won and we we we we basically got that the only thing is we had uh Matt Hogan and Ryan um the bitwise boys on the show last week and they made a really good point which was that um there is a lot of Corporations professional investment institutions and then other governments as you you said those three as as Matt called them three Horsemen he was like I don't really know what they're going to do how fast those three will move right

so if those three move fast and want a front run right then we could that could be Catalyst that comes tough to know when that Catalyst comes it could come soon or it come could come later in the year so that's the only thing I'm not sure of because I know that there is a lot of there's a lot of people that you know a lot of Corporations sitting on the sideline because they're like I don't want to mess around with holding crypto right like but now they see even though the regulation hasn't changed yet and I know we're not getting the regulation necessarily anytime soon and everybody seems to agree that regulation is probably a Q2 Q3 thing is by the will like actually start to see some stuff come through uh so that's the one thing I'm not sure of the the macro side is

the side where as you said that's really what like that's what's really going to affect the markets and make that's the biggest Catalyst for sure and that's the side where the timing is keeps getting pushed back it feels like it feel you know liquidity is going down right now not up it's going backwards like that's not what we want to see yeah that that's what I'm looking at is you know China is in you macro is a is a big picture to to sort of paint but you have things happening in China with with basically in deflation I mean if you look at the yields in China right now so you've got like liquidity coming out over there you've got the FED is still doing quantitative tightening right we were rolling off assets on the on the balance

sheet so um we're still still tightening we're not seeing the liquidity injections that we saw uh with like the btfp um program after the Silicon Valley banking crisis some of the other programs uh that were that were in place so liquidity is kind of coming out of the market right now we know that that uh Trump wants lower interest rates he he said it in a press conference the other day and they asked him you know is Powell gonna listen to you he kind of kind of said yeah he thinks he will right so he there's gonna be pressure he won't yeah exactly so there's gonna be pressure there we don't we don't know exactly how it's going to play out but I do think that from the macro perspective that Trump's policies like like sort of onshoring businesses tariffs the these things that are like

sort of pro like American except exceptionalism these things require a lower dollar uh to me and so that is a thing that I'm really anchoring to so that is one of the reasons I am actually bullish like longer term for for 2025 is I do think that um we are going to see a lower dollar I think rates are I think the market is actually off sides in terms of the number of rate Cuts I just saw the GDP now forecast came out for Q4 it was 2.3% it was expected to be like 3% so the economy might be slowing more than we think um and so I do think we may see more rate Cuts uh in 25 than we expect more liquidity injections we have to um refinance about a third of the outstanding treasuries as well like

who's buying all of that I think the FED is going to end up being a buyer of that in as QE so that's kind of the longer term picture like there's almost no way out of the sort of fiscal situation and then that's the the key thing to Anchor to I think yeah so and and that's why everybody I still have yet to get somebody on the show that's like it the bull runs over we've peaked like nobody has that it's the short term that there is a lot of there's no consensus on the short term so just play out uh play out how you think 2025 goes I know you don't have a crystal ball and I'm not gonna play this back for you next year and expect that you were perfect but just right now what do you expect from the markets yeah so so you know I guess

right now I'm looking at sort of what's happening with liquidity sort of com coming out of the market I think Bitcoin is actually been holding up pretty well there which is which is interesting to me and it signals to me like something could be going on there could be some a buyer of bit a large buyer of Bitcoin in the market that it could be a central bank that that's actually not it's smart for central banks to not talk about it if they are going to be buying Bitcoin so possible you have something like that going on I'm I'm looking at that bitcoin's holding up very well the rest of the market is is not and you can see like just the performance of altcoins and Bitcoin dominance uh is still almost about 60% which is which is pretty high so the way I'm looking at this is like I

think we may see a little bit of a liquidity trap here sometime in in q1 that may be a good time to step in and be a buyer of of risk assets um because I think ultimately that's going to kick off just more liquidity uh injections and so that's kind of kind of my base case in terms of what I expect to see with crypto is there's still some major announcements coming like with monad you know later this year with mega eth with with bar chain like there's more Innovation coming there's there's interesting things still happening on The Cutting Edge of AI agents and and sort of that sector so you still have like that Innovation stuff happening if you get a bunch of airdrops with some of these new projects that creates that sort of like creates a wealth effect in

crypto that we we haven't had one of these in a little while so that can kick things off a little bit so you know I'm still bullish um and like my base case that we would get to like over seven trillion uh of total market cap for crypto so that's still a big move um from here and you know the sixth through the ninth Innings of like a crypto Bull Run are when the the massive move happens and that's why you have to be in the market um because most of bitcoin's like appreciation happens like over like 10 days uh in a year there's been some interesting analysis around that kind of a convoluted answer but but like bullish long-term shortterm um I see I see some risks out there yeah we're at 3.6 trillion total market cap as of this recording today so you know

your base case is a 2X from from here uh I know we've we've had people predict anywhere from seven six six is probably the low and then lots of people saying 10 even up to 12 on the high end so I mean we always have a big range with predictions and you know everybody knows what what predictions are we we do our best but we don't have a crystal ball okay uh let's go to to eth you wrote a report earlier this week I mean you write you write a ton on eth you are deep diving on them like constantly I think once a quarter you're coming out with a new report uh so um let's talk let's talk about eth and the big question on everyone's mind is like you

know should you sell your eth right now right um or is this the bottom and you know people everybody saying they're changing their name from do eth is the the finally the bottom the bottom is in it's obviously very difficult to know I'm gonna bring up well you give us give us your your overall take and your thoughts and then I'll I'll bring up some charts here that we can talk through sure yeah so thoughts on eth I mean this is like uh it's it the chart just doesn't want to capitulate like I've been talking about this for a while expecting eth BCT chart to basically capitulate and to bottom out and it just keeps making lower lows so just recently like we made an even lower lower low and

I've been I've been looking at this and just waiting for the trend to reverse um what we're seeing here is like I've just kind of squared off like where we were exactly at this stage uh in the the 21 cycle and we were actually lower um the ebtc ratio was lower and at the time Bitcoin Maxis were like basically rejoicing you can see it was at the bottom of a downtrend in that box right at the end of January of 21 and Bitcoin Maxis were like dancing on E grave and people were like capitulating on eth which is kind of similar to what you're seeing today with do e dropping their name to do well in markets you cannot be with consensus and so the big question here is are if

you're with consensus and you're selling your eth right now you're in the herd you're probably in the herd the the non-consensus move is to to actually flip from Soul to eth right now um and and maybe catch the uptrend I I don't have strong conviction on this uh I still have about 10% of my portfolio in in ethereum um so I haven't like been one of these people that just like totally moved to salana I think that for me the way I'm thinking about ethereum and we can get to like sort of what's happening and the fundamentals but you know they they've essentially disrupted themselves from the perspective of this L2 road map and you know what's what's happening with

with fees are basically moving to l2s and ethereum l1's value capture has essentially moved to the l2s and and with some technical tech technical upgrades such as EIP 4844 the fundamentals have sort of disappeared in the short term this is something we've been covering we've expecting this to happen what we didn't expect to happen was like the sentiment to shift as harshly um as it has as a result because you know I'm deep in the onchain data I'm looking at it and I'm just kind of like all right everything's on everything moving the way we expected it to it looks like everything that the ethereum foundation laid out for the market has essentially been playing out you know I don't think they came out and said hey you know um like ethereum fees L1 fees are going to go down the the

yield for ethereum staking is going to be dropping like I think those things are spooking the market and people are not really looking at some of these fundamentals which we'll get to but this chart that we that you just pulled up is just looking at um total transactions um the l2s combined that's the the pink line and then you have ethereum L1 which is the purple line and that's pretty much been steady really going back to like you know 2020 or so it hasn't really changed much but all the transactions are moving up on L2 and that's where things are scaling so ethereum's doing about 10x the number of transactions on a daily basis on l2s as it is on L1 right now that was about 3x um about a year ago so like you know things are things are playing out it's

scaling interesting stuff happening with Bass um some of the other l2s and to me like ethereum has to win the institutional game here like that's really what this comes down to like if I start to see I will capitulate on ethereum if I see Larry fin come out and and he's been talking about tokenization and how important this is he comes out and says they're going to do stuff with salana and it's like exclusive to salana right that would be like the moment that I think the market would repic very fast I don't think that's going to happen uh and I haven't seen any any signs that it's going to happen and you know we've seen other sort of Challenger um protocols or Assets in

crypto like do what salana has done to ethereum in the short term and then not really you know followed through in the real like fullness of time you know people forget that like sushi swap like sort of was like flipping Unis swap one point like in the last cycle um and that didn't sustain and like so to me like this going to play out with what happens with the L2 road map and whether or not institutions come into eth and and build their own l2s I think there's an incentive for institutions to do it on ethereum um because they can capture value actually more cleanly through an L2 versus doing it on salana if if there if there isn't like an L2 road map on salana which there probably will be that's that's a separate discussion um

but to me that's kind of how I'm think about eth it's it still has a strong fundamental story it's executing on the road mapap but like the crypto markets are incredibly impatient The Narrative has flipped there is the fact that salana is sitting there and has basically caught up on a lot of the important fundamentals has essentially um you know basically got the market completely offside like the pendulum is completely swung to salana so to me that opens up an opportunity for eth potentially but I I I can't say I have real strong conviction on it just yeah I think I need to see see more uh in terms of like what are institutions going to do with the tokenization story real world assets so yeah it's it's it's it's a very interesting moment for E because

the the sentiment in the fundamentals could not be any further apart right so you know if you if you weren't listening to Media or crypto Twitter you'd look at ethon chain and you'd be like great Road map's going according to plan the scaning of l2s is working sure there's an issue around fees going to the L1 which I want to talk about in a second but but fundamentally looks great and and it's still beating salana salana is definitely catching up on a lot of the fundamentals but it's still being Sal and I agree like to me uh we've been trying to get uh Sony on the show for a while um because I want to ask them the direct question like why did you launch

an L2 on eth because if if they can explain that to to us and tell us that story then like that is a a massive Catalyst that that could come is all of a sudden as you said if you're to me if you're an institution whether you're a financial institution or you're a consumer product company like a Sony or or whether you're a retailer like a Walmart like all of these companies are moving on chain it's there's it's that's a given I think we all know that how are they going to move on chain they'll probably want to control their own ecosystem and they want their own chain what's the best way to launch your own chain right now an L2 like you using either the super chain or using using one of the outof the-box solutions right

so that feels and salana doesn't offer that as you said salana will eventually need their own l2s which kind of makes me think that like you know a few years from now we might be sitting here having the same conversation about salana right so you know I don't know it's it's very hard though right because like everything is I I admit myself like I've I've done I've sold some out I've rebalanced out my eth I've had to right like I think but I can't deny that man it feels like it also is the only one that has the ETF right now yeah we're going to get a salon ETF and we're going to get other ETFs for sure when don't know we just had James saart from Bloomberg on the show he said you know basically if they

if if Hester Pierce came in and uh and this new subcommittee that's currently running the SEC right until Atkins comes in then we could it's possible they could do it in 45 days with some of these applications so like maybe I think the first uh I think there's one in March there's a deadline in March like maybe but he was like that would be super weird we don't even have Salon of Futures we don't have any futures for any of these ETFs yet so I don't know like I don't know it's really tough let's let's um let's take a look at uh the fees the fees situation though because this is this is very interesting yeah so this is you know what I've been trying to do here is like okay if we agree that the the road map

is playing out the way that the ethereum foundation had sort of set set it to and we say okay they're executing on that then we have to start to look at the data and say like what do this what does this mean in terms of value acrel to ethereum L1 and which really is going to impact the yield that validators earn that stakers earn for for holding eth which you know you just mentioned the ETFs I think the ETFs eventually I don't know if it's going to happen this year but we'll start to be able to pass back that yield to the ETF holder which I think is a big deal as well and that make you know Wall Street likes yield so so oh most of people would in Wall Street would rather own something with yield than gold so we'll see if there's

a rotation from BTC there so really what I'm doing here is I'm looking at the L2 fees paid down to L1 there's basically two fees you know the first is the publishing costs that's the first chart we're looking at there and really the new one is the blob fees this is basically the impacts of EIP 4844 where there's a new type of fee that l2s are are paying to the l1s to to store data there it doesn't cause congestion with other L1 transactions um and it does allow for data availability for the rollups and we can see there that like things are picking up like basically the the l2s are now doing blob fees versus the initial publishing costs so that chart's down and to the right the other one is up and to the right and

so I'm starting to forecast out like okay if we look if you go down to the blob feed chart like what's the best day we've had so far in terms of BL fees it was like January 6th and the entire you know l2s all the l2s combined paid about $277,000 to the L1 which is like which is nothing right that's it that's it yeah that was the best day we've had so far you know ethereum was doing $70 million in in fees per day at the peak of the 21 market so so this is the the story um and we have to say Okay well of the if it did $277,000 in fees on on January 6 how many transactions did the l2s process and and passed down to the L1 to to

create that and it was about 16 million transactions uh and so we can start to like sit back into okay if we're going to get to $70 million you know how many transactions would that take and it's about it's over four billion transactions per day on the l1s if you just sort of use that point in time for what the blob fee cost was there over 4 billion that's a 256x in terms of the combine L2 transactions of what we're seeing today to get back to to like you know $70 million in fees per day for E that seems like crazy probably but I think people I think it's very doable actually like I think considering how much how many new like use basically with regulation and institutions coming into crypto I do

think that that's like very reasonable um for for what we could potentially see and the tech is kind of getting to the point where we we could see that in the future but that's a decent exercise I think people should understand like as you're looking at the L2 growth like what does that actually mean in terms of value value cruelty L1 um as we kind of model this out a little bit yeah I mean you you said this uh before we started recording which is e basically disrupted itself which is such a funny problem to have like right you know like they they created this road map so they could scale they've executed on the road map everything's been going great and as a result of it they they their

revenue and so they have less Revenue now and and and they need way more scale in order to get back to that same Revenue which is good like because now they're prepared to scale but question is will will will l2s take us there it's it feels like they will like it really does feel like look at base B is doing yeah bass is the standout of the LT the way I kind of think of this is like you could like think of it as a J curve right so it's like they've disrupted themselves to allow for this curve to play out but we're sort of at the bottom of the J curve where like the disruption has happened but we haven't seen all these new Builders come into crypto and and build interesting use cases that have millions of users on l2s so it

hasn't fully played out but we'll see base is the story of the l2s they did 84 million uh in Revenue last year which was um double what arbitrum did so um really standing out that does that make you like coinbase as an investment right now I think that's I think it makes coinbase an interesting investment I really I really do I think I think that that's sort of the something that like the Wall Street Market like probably isn't really paying attention to they're still too focused on like trading fees and stuff just on on the coinbase exchange so yeah I do think that's this is very bullish for coin okay so you haven't sold all your eth you still you're you're keeping some in the game because you still believe

that it could it could go where we all think it could go and it could have a great run yeah it's just you know I've seen it we saw it last cycle we saw that big rotation the difference with this cycle is that salana is sitting there right so like last cycle like we didn't have Clarity on salana so like when the markets took off last cycle in January of 21 there was a massive rotation to eth and then we saw the longer tail we saw nfts and everything came later that has really played out on salana in this cycle and so that is really the key thing is like are people going to still look look at pullup coin market cap and they're looking at it and they're saying okay like Salon is up 28x but it's still only a third of ethereum and that's

wrong and there maybe they still allocate there so that this is the the key question I think it's a very tough um thing to develop conviction on one one way or the other right now what about if you what about if you ask a classic investor question which is risk reward if you were to compare uh let's just say you're GNA compare salana versus eth you might even be able to throw Bitcoin into that conversation because of how well it's performing right now although I'd say most people would think that SL and East have most likely have more to go for the rest of this cycle but if you were to compare them which which do you think has the highest risk versus Roar which has lowest yeah so um I would say Bitcoin has like the the lowest like Risk risk

reward right it's kind of like the the index in this case right it's probably going to go down left um and up a little bit less um and then you have e and and soul sitting there and this is the the key question is like when you if you're going to forecast out you know where the total crypto market cap is going to go the last few Cycles Bitcoin was about 40% of the the peak of that and so you can kind of take the you know if you think Bitcoin if you think the Market's going to seven trillion or so double what it is you can back into what that is for for Bitcoin at 40% and then you can kind of look at where eth was relative to that at the peak last cycle and then you can look at Soul relative to that and then you can kind

of decide where is the where does the probability rest and I think if you take the position that ethereum has essentially been sort of I don't know if it's been disrupted by salana but basically the um amount of capital that would have gone to ethereum in the past is a lot of that's now going to salana and so you could you start to figure out where where the sort of probabilities lie there um haven't done that exercise to tell you like this is what I think of it but I think that's the proper like framework to to bring to that and say like okay you know if you think if you think you're going to seven trillion btc's 40% of that eth is certain percent of that and then you say okay salana gonna be 50% of eth at the peak or is it going to be 100% you know and you kind

of do your your probability analysis um that way so do you do you think everybody that is going to has the has the salon sorry the eth to salana rotation is that done has that already happened or is that because that's another big question is if that rotation happened in a big way which as you said one Catalyst would be Larry thinkink or other large institutions saying hey we're building on salana but just without any Catalyst do you think that rotation has happened I think most of it has happened I think if we see another leg down for E BTC or E Soul like to me that is the final Cit a of like the do eths like actually doing it right with

and this is like this is what happens at bottoms right like you saw this final leg down even when you were looking at when I was studying salana uh at the end of 22 right it was you know this is after FTX and everything like there were these final just capitulations and like if I see something like that like that's I think you want to buy that for for ethereal at some point it just gets too oversold that um the risk the risk reward flips you know to the to the upside and like that would be like it's a tricky it is it is really a tricky one because to me like that could be the moment that salana like gets closer to flipping eth as well right like because

it could happen faster because you know you could look at it and say okay e salana has to grow like 3x as fast as as a theum to flip it um or you could say well what if all these people that are holding eth these like really long-term holders that have a lot of it flip to salana then Sal then ethereum's dropping at the same time salana is going up and it can happen like faster um so I think for me as a market participant and investor looking at this what I'm really doing is looking at like what are institutions going to do to me that's the the the thing that's really going to matter if institutions go to ethereum and they don't go to salana like salana is not going to like play out the way everyone thinks right now I I don't I

don't think anyways I'm just pulling up uh EF yeah negative outflows of uh 130 million yesterday that's not what I was I was I was hoping to have to have something to say the ETF was ripping I mean it it has started the year off fairly well and it's it is up to net inflows of or sorry net flows of 2.7 billion so yeah it's it's not a dead Rock like everybody thinks it is right but it's still it has good days and it has has inflows and outflows so yeah yeah yeah the other go ahead sorry I was going to say the the other thing to think about here is just like Bitcoin dominance and like are we fooling ourselves like something I've been thinking a little bit about it's just you know we tend to think that Bitcoin

dominance is going to drop and there's going to be this all season and and like that hasn't played out just yet and like it's possible that that doesn't happen this this cycle so um and that sort of what you know Bitcoin Maxis have been preaching for a long time and I think they've been right so far in this cycle is that like bitcoin's the alpha asset it's different it's the the fully decentralized thing it's proof of work and these other things are governance tokens they're kind of useless and like we've kind of seen this in you're seeing meme coins and just like Financial nihilism play out you're sort of seeing that play out where all coins are kind of getting killed so that's something to keep in mind and then if if central banks start buying Bitcoin to me that actually makes

Bitcoin no longer a risk asset uh it actually becomes a safe hav haven asset almost immediately if that starts to play out so that's another thing to and that will totally change like Bitcoin dominance I think over a long over the long term as well yeah yeah it's tough it's tough it's tough out there interesting time markets for sure very interesting yeah very interesting uh let's go to before we wrap I want to talk about a couple of assets that you do have high conviction on right now what you like uh and first I want to talk about Venice deep seek AI all the talk crash the market over the weekend or on Monday uh with Nvidia and the NASDAQ losing a trillion dollars uh we've talked about that on yesterday's

show so we don't need to dive into that uh but we did not talk about Venice and their VV token that they just aird dropped earlier this week if you're in the base ecosystem or you own any base assets you should check if you're eligible to this airdrop because you probably are um but tell us about can you break what what is Venice tell us about Venice and VV token and if you have conviction on this yes um so haven't done a full deep dive on on Venice in terms of like the token economics and how this all like play how this all works my understanding of this um is it's a project from Eric Vorhees who's Like A og in cryptospace OG Bitcoin um and really what he's trying to do here is like make AI um private so I think my understanding of Venice is it

basically allows you to tap into other llms and access those the insights coming off of those but do in a way that you're not like giving your queries away and like someone's stealing your data or spying on you in some way I believe that's what what Venice is I haven't used it just yet um I did see that I think if you own virtuals and like some of the other base um assets like you can qualify for the um airdrop here so I think I will be looking into that since I own a little bit of of virtuals but in terms of like the the token economics that's something I want to look into and I would say like generally speaking with AI my Approach here has been to make very very small bets on this stuff um what I like to do with new stuff like in

a bull market like this is um if I see a a meta forming or something invest in like the leader uh of that and just a small amount I kind of just W it just allows me to put skin in the game which is just going to make me pay more attention to it essentially that's what I've been doing with some of these AI things my intent here is to um go deep in the bare Market that's when I really like like to you know kind of get much deeper on some of the research with with AI like it's it's unclear to me what the business models of these things are ultimately um going to be and like H especially something like the Venice AI token you know is there some connection with people using that uh application

and are you paying for it and the the token this is something I haven't I haven't don't pay for it in the token uh the the connection is so so what's what's unique about reason Venice is getting all the the hype right now is because everybody's talking about deep seek and uh and once I think it happened on Monday or what some point after everyone started talking about deep seek and everyone's like it's better than cat GPT it's the new AI right developed it for way less money blah blah blah um everyone was like okay great let's go use deep seek right but they their their like UI is now restricted to only China so if you're outside of China you can't access deep seek but Venice jumped in and was like hey we'll we'll allow you

access to deep seeks llm through Venice and so there's there's like a free you can use Venice for free is like the the entry level and then you can pay if you want access to deep seeks llm and like other stuff but the unique connection with the token is that if you uh it's something around staking the token I don't remember exactly I looked into it very briefly uh before we record today but basically it's something around if you stake the token uh then you get you get a additional access or something like that but it's not you pay you pay like their subscription is Cash like you pay in USD okay okay yeah it's interesting I mean I think like I said uh I'm following all this stuff I'm especially these a AI agents which you

know they're they're not really agents I don't know if there's some going to be some connection here with with Venice and and AI agents as well they're mostly like Twitter Bots you know for the for the most part these a but I'm interested to see where this this goes and if a business model model forms here but like I think for me right now I'm mostly focused on like what which ecosystems are these playing out on it's interesting that Bas is attracting a lot of this um within within ethereum they're doing a I think what's what's become sort of interesting to me is like base is becoming this onboard for ethereum and and and this is like something we didn't talk about earlier but like ethereum does not have a business development team like a centralized team and this has really

hurt them I think and like basically Jesse from Bas the leader of bass has basically become this uh for for etherum in some ways and so that's that's something I'm watching is it really where which ecosystems are attracting these types of projects um and then you know digging into the business model is probably a little bit more in the bare market and figuring out is there like a category winner here somewhere yeah yeah I think vvv caught the narrative and and clearly I think they were ready to launch and I think they saw deep seek and they were like now let's go right that's why they surprised everybody with u well they they've been around since March they've been around for a while but they launched their um API access and and access to the deeps LM so uh smart smart

move on their part um definitely I think the there is a lot of interesting investments in AI coins VV virtuals AI 16z but as you said they're incredibly volatile and they none of them have product Market fit proven yet none of them have a moat that would make them the winner I think short term they'll probably the as you the leaders will probably do well shortterm but they'll probably drop 99% at the end of this bow you know buyer beware basically uh other than let's let's take a step back what other uh you've been doing a lot of research on memecoins you don't have to talk about mem coins if you don't want but what what other we we've talked Lots

about BTC Ethan Soul which everybody knows what else do you like right now yeah so my portfolio I like after the FED cut rates in September that was kind of the moment for me to kind of move things around and put a little bit more Capital into the markets and my portfolio is mostly like a barbell like or at least that's where I structured it to was like Bitcoin e Soul um Bitcoin is the largest of that right now actually um and then sort of like went into meme coins and like what I've been doing with with meme coins is identify trying to identify things using onchain data where see something that just sort of looks like it's standing out to me so we've been doing some pretty interesting I

think Cutting Edge uh work with onchain data using Dune um to basically look at wallet cohorts this is in it's kind of like taking a lot of the concepts that you places like glass node and some of the early data anal analysts pioneered in terms of like can you find like something interesting about a a cohort of wallets such as like wallets that have that have reached over $100,000 of of the meme coin like can we just look at those wallets and determine any be interesting behavior that we see that looks different from other memes so I've been doing a lot of that type of you know work and we put out a research report a few weeks ago we're going to have more coming um but I've been trying to identify a couple meme coins that I

think are sort of standouts that sort of have like you know BTC like features is kind of what I'm saying they look like kind of cultish SPX um 6900 is one we've looked at I think this has caught a lot of attention earlier um in Q4 of last year I'm not sure where the like if this is going to become like a much more mainstream thing but I think it does have that potential I think there's something interesting about the just social aspects of this and then the onchain data actually pairs up with it and it's what's very fascinating about this to me is Mirad has been top this is one of this is his you know top coin one of his yeah yeah yeah one of one of the ones on his list what's fascinating to me is he's been preaching about this

like stop trading believe in something you know hold for a year and like have conviction all of these things that he's been preaching I'm seeing that in the onchain data which is fascinating to to me he's sort of like manifesting this in the sort of like community of SPX I think um so that's kind of interesting uh to me if we see you know another big leg to to this cycle I think mcoins will will probably do pretty well so that's that's one thing I'm I'm interested in I'm looking at Celestia um this is a project I've been i' I've written about it a few times as like I thought Celestia and suie would be two interesting like L1 alternative l1s that might do well sui's done very well Celestia has not Celestia's basically

been down and to the right like as The Bull Market's gone on so I think it's actually interesting um to be looking at Celestia that's a very long-term uh bet sort of like betting on you know salana two three years ago is kind of how I look at that one um so I'm probably going to be doing a deep dive on Celestia soon but that's it you know kind of looking at some of these like AI things and just like staying up to speed with what's going on um otherwise just monitoring like the broader economy and like kind of just like you know man what's making you what's making you look at Celestia I mean there's obviously no shortage of l1's trying to get the the narrative and be the next L1 and sui's really captured that and we talked about

sui Lots on the show uh and seems to be you know a a trade that a lot of people have liked I mean it's been a great trade so far in the cycle but could continue to do well why why Celestia though what's the what's the appeal there I think it's it's primarily just a bet on the modular you know thesis essentially and where I think just I think we're sort of underappreciate how much block space is is going to be needed in the future and I'm not fully convinced like if you think ethereum uh If you're sort of bearish ethereum one way to express that is something like Celestia I think because Celestia is offering data availability at like a fraction of the cost of of ethereum right now and so there's a chance that um it captures uh some of the market on

ethereum and also salana and other other l1s as well so I think there's a chance that Celestia becomes this like really interesting like you know we're calling it an L1 I I don't think that's actually like the the right way to to to truly think about it's really more servicing like the the l2s it's almost more like middleware kind of and so there's a chance that like it becomes like very pre like very widely used as salana builds out salana may need this with it if they need l2s same thing within within ethereum so that's kind of the bet it's just like a bet on like the demand for Block space uh in the future very interesting Michael been an absolute pleasure to have you on the show thank you so much for joining us

today everybody listening in let us know what do you think VV token Celestia eth vers Soul eth vers BTC you guys bullish you guys bearish let us in the comments uh Michael look forward to getting you back on the show again uh might have to get you back when you do the celestial report or more meme coin you got so many great reports so we'll get you back at some point enjoy it AJ yeah happy to come on whenever awesome my man thanks for listening in everybody have a wicked awesome day we'll see you again tomorrow as always if you liked today's episode please hit subscribe and make sure you follow us you don't miss out on the next one there's also a link in the description to our free 5 minute daily newsletter will we simplify crypto for you while making you laugh and if you're

willing to step up your crypto investing game we're going to also leave a link for milk Road Pro you get access to our portfolio where you can see exactly what we are buying this is your number one resource to help you invest successfully in crypto one final note this show is for educational purposes only and nothing we say is financial advice investing in crypto or any asset is risky and you should never invest more than you can afford to lose thanks so much for listening in my friends have a wicked awesome day