TETHER USAT, GEMINI IPO, SOLANA DATS AND USDH | 0XRESEARCH LIVESTREAM

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And we're back. Welcome back to another episode of the Zerx Research live stream. It's a wonderful Friday morning. Happy to have on my co-host Bacio. Uh Salv Bacio, Triple Bacio, Pocket Picacio, River Bacio. Uh, and we've also got uh Noah from Thea as well as James Kristoff. Uh, both prominent members of the Xerx Research Telegram. How are you guys doing today? >> I'm doing well. Happy to be on. Thanks for having me.

>> James, you have to unmute to speak, bud. >> James, you muted. >> Oh, sorry. You double muted me. Yeah, I'm good. Just uh waiting for Gemini to start trading. Very good. I'm very happy that we have on Noah and James because these are two men who are very disappointed in crypto but who I think spend most of their waking hours also thinking about crypto. So I'm very excited to see um what we're going to talk about which I think we're going to kind of rage bait the two right with the Gemini IPO just like as a precursor. I don't understand finance that well. So, I'm very excited to hear James' take on the IPO in general and then we can go from there.

>> Yeah, I guess we have some history here. We had James on a few months ago um when initial news about the Gemini IPO came out and he famously crashed out. So, we're hoping to repeat that again today. Um but maybe before we talk about Gemini, I do want to just give a quick shout out to Appto for sponsoring the stream today. You'll hear more about them later. Um, also a couple of things Bach that we have to run through as per usual. Um, D London is coming up next month in October in London. Uh, a few of the folks here from the research team and the Zerox research uh, main stays, Picacio, Mark Arjun, a few others I'm sure will be there. Um, and you can get tickets, get 100 pounds off with code

0x100. Also, uh you can get a free ticket by having by sending 15 referrals uh over to uh our newsletter. So, check out links in the show notes or on DS website or the newsletters. Um you can find it. I'm sure you can find it out there somewhere. But giving out a free ticket if you can get enough referrals uh to the newsletters. >> Ian got his ticket that way last time. Did you know that? >> And he didn't even fake it. He just straight up >> reaked. He created like 10. He faked it. >> Oh, he told me to fake it.

>> Sure. >> Um, >> they'll be mad if you fake it, but >> I don't know. I guess if you're really good at it, maybe. >> No. Are you going to come to dance London or is it >> not really New York? >> That's fair. That's fair. And we did also I mean, we're going to have it in New York as well, so I think it makes sense. New York people don't want to get out of New York ever. Is this >> Well, yes, but also ever since the change in administration, so many more conferences are happening in New York. And so, like, do I want to spend a week traveling somewhere to like speak to the same people that are now coming to New York every three months? Like, probably not unless I just want to go to the place that it's at. So, I don't know. I

like London, but I don't know. I'm trying to stay locked in for at least the next few months. >> That's fair. Not the glowing recommendation for DS London that I was hoping for, but >> I'm going to be there. It's going to be a lot of fun. Everyone should go and buy tickets. >> Very good. Um, >> beautiful. One more thing, uh, we are also hiring, Blockworks is hiring a research data analyst. Um, Blockworks, the business is built on data. So, if you love digging into onchain data, um, familiar with SQL, know how to work your way around through uh, onchain data, make dashboards, all that kind of fun stuff, uh, reach out to us. find the links on our website on the blockwork blockworks website or in the show notes uh and reach out because we are looking

for more data analysts and several other roles as well uh of course but data of course is the foundation of block works so reach out we'd love to hear from you if you uh got that dog in you >> very good >> I think that does it for some of the top of the show shilling uh let's get into it I think before we get to Gemini though maybe just some chatter about the market. Um, I think, you know, Soul and the Soul Eco is doing well right now. Hyperlid is doing well. Um, I guess for hype that's sort of just been like a continuation of, you know, it's it's one of those big names. They actually make money. Uh, it's been growing. U maybe a lot of reasons there. Um, Soul is is

maybe having its sort of DAT trade season right now. Um, I guess the big news there is like forward or ticker Ford just raised 1.65 billion um for a Datco to buy Soul. Um, I think what's interesting and and I'd love maybe if we dive into this one a little bit, but like the messaging around like Solana has been like maybe very on top of the narrative. Um, you know, I think maybe a month ago it was sort of like, okay, these are frontr run already. Everyone knows what happened with ETH DATs. So, um maybe this this trade doesn't really work out. Um but we've seen like I've seen some tweets already from people putting money into uh some of these sold outs or this forward rate.

>> He's gone. >> Something just something just broke completely. Yeah, I think it's fine. Um okay. He was getting daddy. >> I'm back there for a bud. Um, do you want to finish off or >> Yeah, I was just saying there's been strong messaging around like, you know, I think there were worries about, oh, this trade is already frontr run like they're contributing sole in kind and now we're seeing I'm seeing a bunch of tweets and announcements saying, no, we're raising cash like this is a, you know, I put in 50 million that is in cash, not in kind. like they're trying to very much get ahead of like some of the the narrative that was um I don't know pro maybe prevalent a few weeks ago. Um curious what you guys think about like soul maybe sort of like a

mini soul season here similar to what ETH had and like this sort of soul dat that's that's kind of playing out right now. >> James, you want to go first or do you want me to? >> Yeah, sure. I mean I I mean I was totally wrong on it, so I kind of bought into the the inkind narrative. um and thought people were gonna frontr run it and price it in, but obviously that's that's not the case. They they raised a ton of cash. So, I think um like Monday morning quarterbacking at the price action makes total sense to me. Um if I just think about like who's involved in it, I think like the solds have a relative advantage over ETH because they're spokespeople are much more intelligent in my opinion. Like to say

what you will about Kyle Sani like he's extremely polished. He's very intelligent and he knows how to speak properly. Um, so like I think one I think he's going to go on CNBC next week. Um, so like if you compare him next to Tom Lee, like I think he's just a much more polished and for lack of a better word professional person that can sell the narrative way better. Um, so I'm not long sold because of that. I but I mean I I I can totally get why people are bullish on it now. Um, if Sani is kind of leading the charge for this, >> I I'll add some context there too because we're seeing seen both from Novogat and Sani that their tagline it seems to be at least for going on you know into the media tour is that Salana can settle every global securities

transaction today. That seems to be like the narrative that they're going with here. >> Interesting. I mean like I I won't get into the tagline. I I think it makes sense given like Salana is trying to be decentralized NASDAQ. I think there are a lot of like uh lowhanging fruit technical innovations that need to occur before you can like really put a material amount of securities transactions on chain. Like for example, there's like regulatory constraints as a financial institution to expose your end users like transactions on a public blockchain as opposed to settle on a private database. Um, but otherwise I think it makes sense. And yeah, I agree

with James. I think the market was um underpricing how much of the 1.65 billion was cash versus inind. And I also think that at one point there was discussion around it being a billion dollars. So it seems that that got up size as well. Um, and it's felt like just watching soul since like late July, early August, like there has been like this very continuous slow buying demand that's kept like a floor on price. Um, so yeah, it seems like the other like solds have been in the market and you see that just based on the data um that's been accumulated and now you have this 1.65 billion that's being thrown

into the market. I I'll be honest, like the up movement after the 1.65 billion announcement all in cash has been like a bit lower than what I would have expected if it wasn't like at least somewhat priced in. Um, so I I'm like still skeptical of like whether we have like an Ethereum type run where this thing goes up like 3x or whatever Ethereum did. Um just because I think that like Ethereum had a lot of like upside reflexivity opportunity because like at the lows it was essentially like left for dead. Um and also like I think people underestimated like how including myself how strong these DOT flows could be on the underlying asset. Um,

but I think this time around at least some percent of the market is thinking like what probability is there that soul has this like Ethereum type run and some capital has been allocated under the assumption that like some percent of the time that will occur. So I don't think you get the same pump but I think it's definitely possible that like soul can continue to do well and I think soul ETH is like a decent trade right now just given the current dynamics at play. >> Yeah. Yeah. And also just to clarify like I I also don't believe the tagline that transactions are going on Salana, right? Like anyone who like has any experience in professional financial markets knows like that is just many many many years away from even being a remote possibility. But I think it's like a sexy tagline that people can

sell. >> It is a sexy tagline. And I agree with you James that um but like one thing that I brought up to Ryan was I thought Tom Lee would probably be a bigger figure just because like he's very big on CNBC and like I feel like he speaks to a larger portion, but he quickly corrected me saying that Sani is a much better speaker and that he will be very very capable. >> I also think the the Worldcoin thing with um >> yeah, >> Bit mine was just terrible. like it was just it was just it was such a narrative derailment um for them to do and especially when he like chirped at that guy on Twitter of like do you want to make money it's like guy come on like this is not this is not the narrative you were selling

>> I mean he had one job right and that's to shell one token that to um Noah with regard to the solds um I think when it was originally announced one of the big criticisms for Salana and I think in general Salana always receives receives this criticism is that everything that is happening on Solana is kind of front run. It's like an open secret. Everybody else knows but you you know people are already involved in whatever but you are not. Um feels like this time around it wasn't as bad or do you think it's purely because like it's cash and previously there were questions about it being in kind and that's why it went better.

>> I guess it depends what we mean by front run. like fully priced in. I'll count as separate from front running and that like it definitely wasn't fully priced in but it definitely was front run. Like without getting into names like on crypto Twitter the last two weeks of August there were people saying oh Salana September and like what do you know they're participating in the DATs that got announced like two weeks later. So I think you have that I think you had like a number of like or for example Alp and Glow recently passed like I think this is somewhat of been like a centrally coordinated effort of we need to get some buying pressure to counteract like this ETH narrative so like we probably need a few DATs the Salana Foundation has been involved in some of them we have like a material

upgrade coming there seems to be something happening with superstate and like tokenization that will touch Salana so I don't know it felt it felt like engineer Ed and Front Run is a byproduct of how many people were involved in the engineering, but I don't say that in like a negative way as far as like this being engineered. I think that's how things tend to be in crypto. Um, but yeah, I think this is like pretty well telegraphed to the market like a few weeks before the announcements reach the the Twitter sphere.

And I um when we had our last live stream, I thought when it starts getting really really silly with I'm I would say a bit more optimistic than the general population. So I think like we always have a bit more leeway in terms of like you know you see something you're like this is the top. I I don't know we can get a little sillier. Do you think um World Coin is not too bad? Um I guess like they're having a Camino one. No, Camino's getting involved in that. Um, but they're having like sillier and sillier doubts. I saw somebody saying that they're going to start building exposure to fluid through like public vehicles. That to me feels like a little bit silly, right?

Yeah. I I mean, I think that the game doesn't scale. Um, like I think part of the the way that DATs work is like there's a certain amount of market cap that you need to accrete as a part of this like ATM game that you play. And if you don't do that, like the fixed cost to running a DAT as far as like producing audited financial statements, the staff required, like all these different fees just are a massive cash drag. Um, and then like the liquidity on these like underlying tokens that are sub like 10 billion just isn't there. And so yeah, if you raise a bunch of capital and then say I'm going to plow it into 100 million market cap coin, it's going to pump. But it's just pumping to a level that allows you to tap and then once you're done t-wapping,

it just comes back down. So, it's in my opinion most likely an unsustainable game. But I think that's like separate from like can the market keep going up because ultimately I have a strong belief that what's driving financial markets and crypto is like just a broader fiat debasement not like there's like this fundamental like bullishness that's pushing everything up and therefore like when the bullishness like reaches a fundamental like high it's going to turn around. I think it's more so like when macro changes in such a way so that like we're not printing money and injecting into financial markets.

>> So you think it'll sort of be more of like a hindsight thing where you know in a year you could say yeah Tom Lee taking funds from BMR and aping them into octo you know playing like that squared game. That was pretty silly but wasn't the last one. You know, the last one was, you know, when some other big figure, you know, ate a bunch of money into XYZ deadcoin. Um, but it could just as easily have been, you know, yep, the sold was was the last that was the last sort of opportunity here because macro turned.

>> I think there's the macro component and then there's also the micro component within crypto. And that micro component is like to your point, what else is there to do? like you had Micro Strategy is the first example of like a digital asset treasury strategy for Bitcoin. It eventually flowed into ETH, eventually flowed into Soul and like these alts and so like you're seeing it flow elsewhere. Um, but I think it's mostly a byproduct of like the less risky thing working and someone already doing it. And so you need to go into the more risky thing.

And like what stops this could be something specific to crypto or it could be like in hindsight the money printing stuff or like interest rates get raised. But ultimately like the continuation or and like the natural evolution of the market is to like go into riskier and riskier structures just as like all the lowhanging fruit structures get like saturated or at least that's like kind of how I'm viewing the situation. So I don't know when it stops but I expect most marginal announcements to get more stupid than they have been.

>> Yeah, I think that's fair. James, do you have any any last takeaways on on the DAT stupid? >> I'm I'm like tired of talking about them like everyone else probably is too. It's just like they're just not that interesting. Um yeah, that's it for me. >> Yeah, I'll uh yeah, I guess I'll close it out. I just I think it's interesting that like the market has like I mentioned before with the Salana ones like I don't know they've been getting ahead of the narratives um and really like reacting to what kind of the the market the consensus has been saying.

though like the sole like the sole folks or groups that decided to spin up some DATs like you know the sole inkind thing became a big you know kind of quandry there and so it was very much like the messaging changed when some of these larger debts were announced like no we raised x amount in cash not inind like be very clear on that so I I would just expect to see kind of like what you're saying Noah um as the silliness increases we'll probably also see like the messaging silliness probably also amps up and reacts um even more quickly in real time with some of this stuff.

Um, before we jump into the next thing though and before Ryan Connor Cashful Connor joins us, >> Ryan heard James say that's aren't that interesting. He's going to yell at him in a second. >> Before Before we get into that, uh, let me do a quick shout out to our sponsors for today's stream. Aptos uh, Bitcoin DeFi is heating up on Aptos with nearly 400 million in BTC assets on chain. Aptos users can now earn yield on their Bitcoin via Echo ABTC and OKX XBTC without the typical bridge risks and high fees. Thanks again to Aptos for sponsoring today's stream as well as IGEN Cloud. Is your treasury losing value to inflation? Learn how to make digital assets like ETH and Soul productive with uncorrelated

protocol-driven staking rewards. For CFOs, DATs and corporate treasurers, the path to integrating liquid staking and restaking should be riskmanaged and aligned with long-term strategic goals. The productive treasury report from liquid collective and iencloud outlines practical adoption and a forward-looking vision for the role of the modern treasury as a strategic enabler of new technology. Read the productive treasury report today by phone link in today's show notes. Let's get back into it. >> I need Ryan. >> Let's get him in here. >> Well, no camera today.

>> It's really awkward if he doesn't have his camera on. >> Hey, can you guys hear me? Yes, we can, but we can't see you. >> That's okay. >> I do think um glad to have you on, Ryan. I think something that would be great to talk about now would be the Gemini IPO. Um >> I know. >> Can you say something there? >> He said no. >> I want to talk about bats really quick. Can I jump back in on that? >> Yeah, go ahead. Do you have something more? >> I comment on I try to comment on on X and it's like not working and it's glitching and I can't comment on YouTube because it's glitching. So, I had to come on live.

>> I want to live in the comments. >> Yeah. So, you're >> I think that they're kind of interesting and that BMR almost has more ETH than the EF. So, it's like who's running the show, you know, and and and who do you want running the show? Like you know the EF has come out a few times and said like hey we don't care about price like it's not our responsibility and like imagine if like a CEO came out and said that about their stock but like Tom Lee's not going to do that right so it's like I think it's incrementally bullish depending on the entity that's kind of like getting control over these networks. Um and if you know if this Salana one they're

raising 1.65 65 um or or they're they're going to they're going to buy that much soul. What's what's Sana now? 120 billion FTV. Like they're going to have meaningful control. I mean, not not control, right? But they're just going to have meaningful influence and um you know that could really change what you think about like management and then the future of these things. So I think that I think that they're getting actually think that they're getting more interesting. I think you can say that maybe for Soul, but like I I just don't know how like how is it interesting for ETH when everything Tom Lee suggests is is just like objectively not factual and like things he talks about for value

accretion and what he would like to do. >> Oh, wait, wait. It could technically go 56x. There's nothing that says it. >> No, no, no. I I don't I don't even mean stupid stuff like that. I'm actually I'm actually not like not being sarcastic right I just mean like when he's selling this narrative of stable coins and like you know who's the guy ex black rockck guy that went on the bank was podcast and describe like the value accretion to ETH for every $2 of dollars that go on the blockchain you increase by a dollar of ETH and everyone nods their heads as if it's real. Like it's it just cheapens it and that's why I think it's so frustrating. Like >> it'd be one thing if you just had the 56x thing and it was kind of like funny and goofy like cool I get it. Let's all

like meme it. But when you're trying to like just lie about value accretion in weird handwavy ways that everyone knows is not true, like it's just stupid. I don't know. I'm just tired of it. I don't think I That's what That's why I said I don't think it's interesting. >> But that's the Eve dream, right? It's selling you have Yeah, I guess so. >> Everyone knows it's not real. Like it's just stupid and like that. That's that's why I think like this is a great opportunity to sell all of your ETH to Tom Lee. Like great. Like I would make that trade all day.

>> Well, what do you think about like like there's going to be a day where Tom Lee says all these things to the market and the market or or the retirees that you know subscribe to Fund Strat for a few thousand bucks a year. Like they are upset that ETH isn't going up anymore. It's actually going down. And like none of those promises are fulfilled. Like I think now you have at least someone who owns a lot of ETH who can like crack skulls and get people to do what's right for the price of the asset potentially. I'm not saying that that's going to happen, but like that is that is the interesting idea I think around a like proper like steward of capital like actually owning more of this asset than the foundation

which you know you could argue hasn't been hasn't been a great steward of the asset for a few years now. >> Yeah. Yeah, but like that that kind of like that presupposes and like kind of gives up the game um in my view of like Otto is going to go around and what like get every single ETH core dev to like what raise the gas limit or like move things to L1 or L2s and L3s like the the whole road map is like so convoluted and like fundamentally broken in my view that like I I don't know having Tom Lee there to change it and like tell everyone he's got 5% of ETH now so now they need to listen to him like I don't know is is that going to happen?

>> Does he have 5%? Is that the number? >> I'm just making up a number. Is that's probably directionally close to it. 2% 3% I don't know. Something like that. >> Yeah, it gets more interesting as the as the stack gets bigger, the stack of ETH. >> But does like does actually controlling that much ETH give you any actual leverage? Like like why why would like the Ethereum Foundation care now is my point. Like they haven't cared for the last 5 years. So like now some guy on Wall Street has a bunch of ETH. Like what what's he going to do? Threaten to sell it? Like I don't know. Like you're going to shoot yourself in the head for it.

>> Well, the EF would have sold it anyway. So the threat to sell it isn't really that relevant, right? >> Yeah, exactly. That's what I'm saying. He has no leverage. Like he's going to yell at Vitalic and Vitalic will write a white paper. I don't know. >> Yeah, those are all very good points. I'm I'm presenting admittedly I am presenting the optimistic view and why I do think like that I do think that Tom Lee in the picture like it's not controversial to say this him being in the picture is like incrementally bullish but I think it's bullish in a way that um perhaps not everyone appreciates but yeah you're probably right I think the scale of ETH ownership is still too small but you know you like whereas the ETH foundation like won't

use DeFi right like Tom Lee will and will funnel profits and revenues to the teams that hopefully deserve it. That's the hope. Um so that's probably another interesting way that he can influence things. >> They >> I actually agree on this point. um like it and you see the same thing in Salana and in general like when we underwrite a lot of these DeFi applications like one of the main drivers is like what percent of the native asset is like deployed into DeFi just given the size of these assets like Soul and E specifically and so like the the trend for ETH and DeFi continues to like be up and to the right and this is a great way to like take capital out of passive ETH holders hands put it into someone that like needs to justify their existence and they're

going to have to deploy that DeFi and like there is this like reflexive cycle of play where like you do activity in DeFi while then the chain is like earning more fees or seeing more activity on it. So I don't know I you know I'm not saying that's like the most likely outcome that this is like very bullish long term but there are benefits to these dats on the underlying ecosystems. Yeah, Ryan, do you think it's meaningful then that um with the soul that and the Camino kind of positioning themselves to be the like a market for that? Do you think that's a meaningful thing for the Camino side then or do you think it's just like buzzwords on their end >> or you mean Camino receiving soul?

>> I need to pull this up but it's like >> are probably just not familiar with the news. Well, I'll I'll pull it up and then I'll pull it up. >> Should we talk about the Tether thing that just broke? >> Yeah. >> Yeah. I was going to go to that next. Um, since stable coins have been pretty big. Uh, big thing that just got announced. Tether is entering the US market with a USAT stable coin with Bohines uh, supposedly as CEO. Let me pull this up. We've got scoop from our boy Jack Kubak here can share this.

>> Um, but apparently with Anchorage as issuer Canifer Fitzgerald for handling treasury reserves, um, seems to be their way to like enter the US at scale. Um, which maybe puts a question mark like I don't know, we've got some plasma enjoyers in here, but like I don't know, does this put a question mark on like all of these stable coin chain raises um as of late or you know USDH on Hyperl for example, Circle making their own chain like >> isn't this good for the stable coin chain? The stable coin that is the underlying for the stable coin chain. I mean like I'm not getting into how are these stable coin chains going to make a

lot of money um if like all the transfers are free etc etc but like if the product underlying all of it is now legit in the US then that's fine right like that's a good thing >> I think it's a good thing >> also plasma I don't sorry finish it right >> no you go >> like the stable coin chains don't care about the US I think they mostly care about well they care about the US for DeFi and stuff but I think they mostly care about at least how they're positioning themselves is like for payments and I mean in the US you have a million payments uh like ways to do payments and stuff but in other countries you don't it's hard to get a

hold of US dollars. I think that's like their main goal there. Um so I don't know how like this to me just feels like it's good for Tether. I didn't even I'm and I don't see how that could be bad for plasma or stable or I'm sure there's like a few more that I'm missing that are are doing funded. >> I think like ignore any of the questions of like what's the value accretion to this stuff and how do they actually make money. Um it's like obviously objectively good if there if tether's building a US-based like blessed stable coin for sure.

Yeah, probably the onlybody or the only person that clearly suffers is USDC side circle if going going to zero. Y >> they started buying Hyper Liquid this morning. So I think they're going to make a post. They bought like 5 million hype USD. >> What's the what's the strategy for Circle here? Like if you see Tether coming to the States like what's your move? >> Did they already cash out? I have no idea what they're >> Jeremy Lair still works there, so I don't think he cashed out. >> I mean, he had like a eight figure secondary a few weeks ago given he still has a lot more money, so it's not that meaningful, but there is some some secondary being taken off.

>> Let him buy a house, man. Let him have fun. >> Let him have fun. >> You can always be worth more. So, I don't know. I don't know. It >> That's true. It feels like that's, you know, that feels like that's usually not the right argument for, you know, people operating or managing companies that are worth multi-billion because then, you know, probably the next step for them is to then be worth a h 100red billion or a trillion. Um, I guess just like operationally like as circle, I mean, they've kind of I feel like they've been sort of fumbling the bag for years now on really like dominating this space as the kind of deacto US stable coin.

Um, but there's it's there's seemingly so much more pressure now, right? So surely you have to like amp up efforts in some way or another. >> Can I save something very short and then we'll let the actual people who know speak? I think Circle got away with just because Tether was not trustworthy in the US for some time and because the West doesn't like Tether, they just got away with it. They got kind of lucky and then they ended up signing a massive deal to share 50% of their revenue with a company who doesn't innovate that much as well. And now Robin Hood is like going into crypto. So Coinbase, I don't know how they'll do and Tether is anointed and allowed in the US and has the like regulatory backing or whatever.

Like they're more and more trustworthy that I can't imagine. And USC is one of those companies that's extremely slow, right? It's like Circle, Coinbase, Ethereum quite slow. They move very slow. They don't really do the pushes that they have to do in my opinion. Um, so I just imagine Circle very slowly fades into obscurity. I think that's the reasonable base case, but I think that that is probably a pattern that you see in general for public markets over the past 5 to 10 years with like fintech IPOs where like a lot of them it's that's like the cash out moment and a lot of the growth prior to the IPO is when like the cap to LTV

ratios make sense and then right around the time when like their growth seems to be stopping they'll or like they see competitive pressure, they'll go IPO. I think like the issue now, and maybe we can talk more about this when we discuss Gemini, is that like it's one thing to have all these growth companies be private and be selective with what information they share as to not like reveal how weak they are, but once you go public and you're forced to like continuously share information, your negotiating leverage really changes. And so I think that's like the main issue with Circle is that like if you didn't know what their average distribution deal was and like what take their distributors were getting, now you do.

And if you were like as a distributor thinking like, oh, I was only going to give them like or take 10%, now I'm going to say, well, I want 50 to 75%. So I I just think Circle in general is is challenged. Um, and they need to like build out more products as to not like fall under the label of like being a money market fund long term or like have the economics of a money market fund, which is kind of like what it looks like today. >> Yeah, I agree. I think it was kind of like disingenuous to like really market this thing as a technology company to begin with, right? And I think a lot of people are kind of getting wise to that now. Obviously, the valuation doesn't reflect that, but like long-term it seems probably most likely to me.

>> What other products do you offer? I've I've always thought the same that um kind of the stable coin should be free and then you monetize in other ways. I don't know what is what are the takes on those like additional business lines like what what makes sense? >> I am uh not an ideas guy. I'm good at listening to ideas and trying to assess them. But yeah, I I don't know. Um, I think like going into the payments market could have made sense. I I think ultimately like we'll figure out what the the best tangential products are because it's going to be those companies that offer those tangential products that like start to integrate into the stable coin market. Um, so yeah, I probably if I were them would have like been more inquisitive um as to like build out a remittance business or

something of that nature where like the the take rate they can justify on volume is is pretty high. Um, but even then like that's like a slow fee compression to zero. So I don't I think payments in general is like a hard market and same with stable coins. You just need to take such a large percentage of the market in order to like be generating a real amount of cash flow. So kind of a copout answer, but I don't know exactly where they should spend their time, but remittances and payments is probably like the most immediate place that I would be focusing.

>> Yeah, you got I think it's payments first and then some suite of financial products. Yeah, >> it's interesting that like Stripe has made acquisitions in that area and you know as of late and you know Circle has never taken the steps really into that ballpin feels or maybe it just speaks to the maybe it just speaks to the operation of the business there. Um we know Stripe is a is a behemoth and they move quick. Epheri makes a lot of money from their like Epheri cash product increasingly more and more money and they show all of the transactions live as well. So it's like it's a broken product that makes a lot of money. So I imagine Circle could have just made that not broken and probably made a lot of money.

>> Like a like a social product where you're showing off how much you're spending. >> Well, I don't think that's what unintentionally that is what they're doing. I don't think they were imagining that people would build out Dune queries to figure out who's spending how much money on what. Um, but that's like what it's ended up becoming. Um, but I think Circle could have done that, but like private potentially. Um, feels like that would have been a good use of time. Like I would have probably used a Circle card. I trust the USCC as much as I can trust any stable coin. So I would have >> I think they could have easily done a Circle. Like I mean Coinbase has their own card. You could have easily done very similar product roll out with

similar rewards offerings. >> But what about instead instead we hire too many people and then we make Coinbase do the work and give them 50% of the only revenue source that we have. Does this also make sense? >> Okay, speaking of other maybe crypto companies that uh are in the IPO market um outside of Circle, Gemini is the big one today. Um so they priced at 28 a share raising at or being listed at a valuation of um targeting 3 billion or so $3.3 billion valuation uh raising 400 some million dollars. Um James, we've talked about this one before. Um I don't know Ryan, I saw some comments from you

as well on Gemini. I'm just curious like to me it seems like this is like way down the list of like central crypto centralized exchanges um that you'd want to be looking at. I I don't believe they're profitable. Um I mean is this really just like crypto narrative is hot like circle IPO did well, bullish IPO did well, throw some money at at Gemini, hope it pops, but otherwise there's not much there. >> So I'd like to ask a question and all four of you give me your best guess. So, over the last 24 hours, what percentage of Bitcoin trading volume was done on Gemini?

>> I'll go first. Um, 75 bits. >> Yeah, I was going to guess less than a percent. >> Yeah, I'll say 25 pips. >> I'll say 5%. >> So, most of you guys are off by an order of magnitude. So, it was 06%. So yesterday BTC dollar value traded I'm just pulling this from Coinbase 46 billion and Coinbase or sorry Gemini has done $31 million on the BTC USD pair. So like to Noah's point before of like yeah you didn't know about the distribution deal of um like when when circle was was more kg about their financials like you can just look at the volume that is done

in this exchange and just objectively say that this is not a real company. Like Buck, what does H what does Hyperlid do for like BTC spot now? Like daily volume? >> Uh definitely more than that. >> No. Yeah. Yeah, of course. But I'm just saying like this is just not a >> this business is not real. >> Yeah, for spot I'm actually not sure. One sec. Something I find interesting as well, like I think just anecdotally, the only people I know that have used Gemini have used it for their um what their rewards card that gives back like an absurd

amount. Like they've I think they've historically given maybe 4% back uh for using their card like in crypto. Um I don't know, maybe maybe they're just giving I can't I don't know like fundamentally if that's them burning money to subsidize that rate. Okay. I assumed it was by like a percent or two, but um yeah, I don't know. I don't know how you can have a loss leader and then also the exchange doesn't make money. That just feels like it's >> if your business is credit card points, like you got a you got a [ __ ] problem.

>> James, I have an answer for your question on so unit Bitcoin, which is Bitcoin on Hyperlquid, did $456 million of volume over the past 24 hours. This is based on Coin Gecko, so it might be a bit off, but should be fine. >> Okay. So, do you think it will My question to everybody now is, do we think that it will pop at launch and go up over the next, let's say, week? I mean, it's 20x over 20 or 30x over subscribed. Um, and Robin Hood's getting an allocation, right? So probably seems like every crypto IPO is going up.

Uh you know I think you know we were at a dinner where we all thought about the circle price and all bet that it would be lower than the IPO price uh by the end of the year and I think that's pretty realistic as well. I think there's a lot of euphoria in the market right now. The counter I'll make was that supposedly Clara's IPO was oversubscribed by up to 25 times, but it only popped 10% on list day. So, I just I don't know that over subscription really means anything, especially when it's you know, if you're indicating interest on a an amount of size and then, you know, it's it I'd have to imagine like retail users on Robin Hood like

you're you're kind of playing the game, right? like it in in essence this IPO market is something of a lottery. So it's like sure I'll set aside five grand and maybe I get filled for five shares, but I'm I'm probably not going to buy more. I'm not going to push the price up, but if I, you know, got my five shares, I'll try to flip those for the 2x. Um I just wonder how much of an impact it actually has on, you know, once the market's actually open, um that over subscription stat feels a little bit meaningless. >> Okay, so up or down? Let's play the up or down.

>> Danny, you didn't give an answer. Up or down? >> Uh, I think it'll probably be up, but >> that's fair. >> You want a percent? I don't know. >> I think it'll trade flat. I think it'll close today around 28 bucks. >> Okay. No, I don't know if you're able to stay up or down due to your position, but if you want, you can just point and then we'll just guess. >> We don't have a position in Gemini. I I uh I think probably up in the short term, but I'm like quite negative on it at 3 billion over like any longer term period of time.

>> Okay. What like crypto IPO would you guys be excited about or like cryptoreated IPO would you guys be excited if you were like wow if these guys like go public? I would scoop up as much as I can. I mean depending on price and stuff obviously but >> I feel like objectively more interesting ones would be like Kraken Phantom. Not saying that like I mean what's the valuation relative to their to their actual numbers but more more interesting than Gemini for sure. >> Yeah. >> Yeah. Phantom's interesting, but I feel like it's going to be a long time before that happens. Sorry, Noah.

>> Yeah. No, I I agree. I think Phantom's interesting. I think Fireblocks is interesting, but I would have to like see the business uh because I haven't looked at it for like a year and a half. But I think they're like reasonably positioned. Um, you know, Stripe is probably a bit of a copout, but I would like that to be public. Um, >> yeah, those are a few that come to mind. >> Fireblocks the custodian. >> Uh, yeah, they they play in the kind of like tokenization space where like they work with a lot of um like traditional players. Um, and just on that line of logic, I think Anchorage is probably also like directly interesting.

>> Yeah. Anchorage and consensus I think are all really good trap by stories. It's like you know get the picks and shovels. >> Consensus as in Metamas consensus. >> Yes. >> Yeah. Joel Luben. [Music] >> Why is that a good business? Right. >> Consensus is an interesting one because I think Picacio's reaction tells you how CT would feel about it. Um but maybe it would still perform like Circle did at >> I just I guess >> they own like too >> they own a bunch of stuff. The score is really good. They've got a good They've got a huge portfolio. Yeah.

>> Yeah. >> I forgot what >> I could see that MetaMask and I was like "Dude what?" >> Yeah. No, spin-off MetaMask. I'm looking for the MetaMask. I feel >> um >> MetaMask Prince or or did last cycle, I remember. >> How did you guys feel about Bullish, by the way? Is that was that like a nothing burger? Like it's just it's whatever. It's CoinDesk and the associated exchange that nobody is familiar with. >> Yeah. I didn't even look at it to be totally honest >> cuz that one got I mean just comparing it in terms of like what an outcome might be like bullish went two or 3x at list and then it's down since then obviously but I think still above the IPO price um not that meaningful but I

don't know if you want to try to pattern match a potential Gemini outcome here. Not saying that it's going to pop that hard. >> Yeah, I don't have an opinion on bullish prior to it IPOing. never really thought about it. Um maybe towards unlocks I'll do some research and form an opinion. Um but I think in general like the opportunities for crypto exchanges are as acquisition targets. Um and to a lesser extent they have to pivot into offering like a full suite of products. Um whether that's like they go the cryptonative neoank route or they go the traditional brokerage route and their entrance is via crypto trading. The second one I don't think is like an easy one to do. I think it's much easier for like interactive brokers to like add

crypto support as opposed to like Coinbase adding equity support. Um but yeah, I think like below a certain valuation in like public markets um for like some Trapfi companies are going to be able to justify like buying some of these companies. Like that's kind of like my only logic for why Gemini could potentially be worth three billion is that like someone values some of their IP or licenses. Um but I haven't looked under the hood to like understand what that's actually worth. Yeah, that's like the NASDAQ I mean that's the case for the NASDAQ investment, right? It's like they have infrastructure for staking that they think is useful and a distribution to a new like customer set probably not worth three billion but >> oh with I wanted to bring this up but

Anchorage is doing the Tether USA dollar thing just um in case anybody else hasn't seen it. I just saw it. Um Danny, what else do you have in store? Uh, if we're going to jump to something else, let me do our last quick shout out to our sponsors for today's stream. Thank you to Aptos. Uh, with nearly 400 million in BTC assets on chain supported by a secure, fast, and affordable MBM environment, Aptos has become the BTC growth chain. Apttose users can now earn yield on their Bitcoin via Eko's ABTC, OKX's XBTC without the typical bridge risks and high fees. With support from Echko, OKX, and STAX's SBTC, Aptos is the place to go for best-in-class yield on Bitcoin. Appreciate the support APOS

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Um let's get back to it. I think one other topic, something that James wanted to talk about which I think is good um just when it comes to our space in general is like the cyclicality of narratives. Um it in the sole space like one of these has been like this kind of launchpad war meta rotation where um obviously like pump is still kind of like the dominant leader here but over the past few months we've had like you know you had believe launchcoin pop up for a bit um bonk kind of made their run for a month we saw light go for a week or two um I'm seeing some other smaller launchpad like new ideas of the same like kind of game um popping up again.

Um but we we I think outside of Launchpads as well, like we continuously see like little narratives and metas like pop up for a few weeks, maybe a month here and there. Um I don't know, James, you you said you had some thoughts here. I want to kind of give you the floor a little bit to open it up. >> Yeah. I know. I think they're like, look, I think for like an individual that can take advantage of them, they're they're very interesting because like we just keep repeating the same pattern over and over and over again where these things get crazy amounts of hype and they put out one or two little tweaks to their like I'll just call it a Ponzi game like Lights, you know, fee burn mechanic that everyone came out and was just like, "Oh my god, this is the

second coming of Christ." Um, and like obviously like you can't do this as a fund or anyone, but like for a retail person like you can put a decent amount of size into this kind of stuff and and and do quite well on it is I want to say repeatable, but like you can predict a little bit like the hive mind of CT is going to go crazy over what are fairly stupid and like not novel concepts like what what Heaven did and um other kind of launchpads like that. But I just think more broadly it's just it's just very instructive of how quickly we're like speedr runninging stuff and getting super bold up and sending these these launch pads to I don't know what light topped that like over like 150 mil FTV I think.

>> Um like >> really okay maybe I'm doubling. Yeah. >> Um which is just like obviously idiotic and stupid. Um but you know I was like I was super bullish on it. I you know didn't sell all of it at the top but I sold a lot of it. Um, so yeah, I think it's great. I love it. Like keep doing more of these things, but I think it's a little depressing that we just like speedrun these things in like 5 days. >> Just as a stat, if you pattern matched it to Launchcoin, um, that topped at 343 million. So, not too far off there, at least in terms of kind of where that went.

>> Every four months we do a flywheel exchange and you get to sell it at 300 mil. And you're upset about this, James? Come on. >> I'm not upset. It's just it's just goofy. Like there was another one that I bought um Star. So like this was like probably like was this in like July? So like they did an ICO and if you bought it you were instantly underwater and then like the team realized that they had no product whatsoever and then it kind of just chilled for like I don't know maybe like a month and a half doing absolutely nothing. And then like last week I don't know what happened but like the thing just went up like I don't know like 40 50x in like 3 days. Um, and then it crashed like 98% in like two days.

They did a new token launch yesterday. I think they did an ICO for some new vaporware company and they raised it like 350K and then they started trading and then that token was down like 75% instantly on like the first wick. Um, like it's just funny watching this stuff happen. Like it's then like Star was even more condensed than than than Heaven was. Like it happened in the span of like two days. Yeah, markets are a sum of their uh like the characteristics of their participants and in these like ultra niche corners of the internet like you have very different participants and I think you know we found like I I I can remember a decade ago in small cap stocks like my I mean not small cap

stocks like like penny stocks you would get these like similar runs around like social media narratives like things claiming that they were the next Facebook and they had like one registered employee and um you're just seeing and now now now the friction to launching those things is so much lower. So you get these games and people want to play those games. Um and I will come to the Star team's defense. Uh I I know them. They are good people and they're they're building a real thing and some of it and a lot I think a lot of it's cool. But yeah, I agree. Like there's we're all there is a corner of the internet that's playing a narrative game, you know?

>> Yeah. I mean, look, look, I don't mean to call out anyone specifically like like I just I think there's a problem with like how rapidly these things come to market and like same thing with believe like there just is not a completely you know you don't need to be a completely thoughtout company to to launch your product. I get it. But like there is still where is the flywheel for example for believe? Like it's just it's just like it's just kind of embarrassing at that point. Um that teams should have this stuff pretty well fleshed out I think before they raise money. Like this is this like real money these people are making, right? Like these these small teams of less than a dozen people >> are walking away with like eight figures sometime in in real cash. So that that's

my problem. Yeah, you need a mechanism to keep teams honest and I don't know a lot about futuri but I think >> metadal mentioned metadal mentioned >> but I I do think that there is a or I think of like the layers that you could apply to these raises to keep teams honest. Um I'm getting more and more interested in something like futarchy to you know when the biggest holders can say like hey you guys aren't fulfilling your duties like give us the money back type of thing. So, so there needs to be layer and there needs to be a back stop >> disclosure as an investor in futur. Um, but yeah, no, I I agree. I think that

there needs to be more transparency. Um, although I think that's like somewhat separate from like memecoin launchpads just because like it doesn't feel like the coins that are using these launchpads are like real companies or pretending to be. Like I recognize on launchcoin believe like there that was kind of the premise and that's why like I personally thought it was like quite insulting to like people's intelligence. Um, but like the rest of them it just feels like they're just meme coins and you know the launchpad has like a token underneath it and so as it goes up in price it participants get wealthy. They speculate on memecoins flywheel then you know everybody realizes oh this now 300 million and you know this is a small team and an ephemeral that's like easy to build. No,

>> they give the game away right away because like heaven all they talked about was how the flywheel works to increase the price of the token. And I think I saw zero posts like when they were launching the deck the decks and the the launchpad product of like these are the types of products that we would like to incubate and what we want to build on the platform. It was literally just talking about their fund that's going to buy random coins on the platform and then how much that's going to make the light token go up and zero lip service given to what they're actually going to build.

Guys, dare I say Pump Fund is actually probably the best implementation of this system where you don't really know how much the team is going to buy and they have multiple applications going live or am I going to be shot to death by >> I think I mean like pump funs Lindy now like I don't think we need any more launchpads like it's it's kind of like over like totally totally don't even talk about like do you think launch pads are good or bad that's like that's irrelevant here um but like I don't know how you could raise money from a VC now to build a new launchpad. Like if you're funding a new launchpad, like I'm very curious what you think your edge is um to do that on like >> I don't know, man. Football.f fun popped

off like three weeks ago. >> Yeah, but it's died since then, right? >> Yeah, but then they they went through alliance. They got a little they got a little >> They go for Alliance. >> That was so funny. People were like people were showing me that and I remember one of the logos was like the the New York Jets team with the [ __ ] Houston Texans logo on it. It's like no no no one even cares to put like the most basic level of like solder research and proof reading into this stuff. I think the counter there though is just like I don't know people see the outcome of pump and so naturally I think there will be funds that want to chase that and and you know invest in a a story that can maybe follow it whether or not the chances of success are are really

there >> and and at this juncture you can compete with Pump Bonk proved it and they still don't have like the sufficient moat where that I think they can run away with it. Well, Bonk proved it for a week until their money ran out, right? Like >> they proved it for a month. >> Okay. They they did it for a month and probably spent way too much money and then they got really really loud in my in like everybody who was still posting about pump. They got really loud under their tweets and then the check stopped coming in and they just stopped. like they did it for one month, but there's no like I mean I'm sure there will be a competitor and I can see there being like a reliable competitor eventually but

>> if it was a cash burning exercise though then it does I mean it does prove that like with enough funds like if someone really really wanted to displace pump they could come in and just do exactly that burn the funds and repeat what what Bon did and until maybe enough time passes and now you're the Lindy platform I don't know. I think it would very much be an exercise in like, you know, let's >> we're maybe not going to make money for a long time here. >> And I actually do think the social stuff on Pump is interesting. Like I think they're I think they're intelligent and dedicated to actually building something outside of like just launching coins.

Now, will they be successful? I don't know. But I I think it is it is actually quite interesting. >> Can I say something about the social stuff? Wait, Ryan, you go first and then if I say it after that, it'll be much fun. >> No, just go for it. >> No, please go first. I was going to ask how many Pump Fun streams have you watched this week? >> No, me zero. I never will. Like I think it's all stupid, but like I'm not the I'm not the marginal consumer of that, right? Shockingly, but like I think a lot of people will. >> I I heard that's getting a lot better. I heard the content on on on the live streams are are a lot better. It was like a ghost town. I It was a ghost town a few months ago. So, we'll see. I think

the Gainy Pod is hilarious. >> They improved um they improved payouts. uh to creators. The rewards to creators are higher than they were before, which maybe was part of an incentive to get more. >> And I listen to I listen to that podcast with Noah, not not this Noah. Um like there it's pretty cool. Like they they will if you if you send them like cursory level information of what you're going to do, they'll send you like a streaming kit to your house. Like that's pretty cool. I think that's like a um like they'll send you I think like 500 bucks worth of like a mic, keyboard, I think like a very basic PC. Um >> pretty sick.

Yeah, I guess I think that's a very smart like move on their end to onboard people. >> That is cool. I will say only people who are like really interested in the streaming product are they're usually like over 30 for some reason. Like everybody else I know is like oh the streaming product is that interesting. Like I don't see how it captures versus like people over 30 are like wow this is like the future. This is going to do fantastically. So I don't know how >> just called me old. >> Why do you think that is? I don't know. I >> the generational divide.

>> I don't know. I'm nearly Freddy as well, so I can't I don't really have much to say but >> I don't know. Like >> I don't know if anyone in this call is really like the true target audience of the creators that are streaming, but uh I think there maybe is something of a point there. But I do agree that like I mean they need to onboard creators that otherwise like you know if you're turned off of like a Twitch or a YouTube because you get one viewer like you can probably get four or five if uh Alon sends you a mic and a and a camera and you know maybe if he reposts a clip that you put out on your second stream.

>> Yeah. >> Yeah. And what I love most about it is like they're not they're clearly at this point not going the route of like going to like Kaisen or something and saying like here's a million dollars like $100 million sorry they're effectively like building their own quasi like venture portfolio of streamers like they're just onboarding thousands and thousands of random people the vast majority of which will never make any money but to the extent that they actually get like one or two of these next people like that is going to be a level of brand loyalty and exposure for those streamers that like will will pay off far more than than it costs the cost of acquisition for the for the failed ones. I think >> I I wonder if they should do at least one acquisition though just to get >> I don't think they I don't think they

should and I don't think they will. Like I think I think they're smarter than that. Like >> I think it's a waste of money. >> Yeah, totally. >> Really to get like Kaisen for a year. Let's >> Too much money is they're like those those are like recurring revenue deals. Like if you get Kaisen for a year and then he then he leaves like I don't I think that's just like a terrible look. It's it's just the way that it would work is like the viewers you would get would all leave when he goes away and the amount of money you'd have to pay for that contract like >> would actually be like greater than that of like an NBA or like pro football player. Like it would just be a stupid amount of money to get him on your platform for one year.

>> That makes sense. >> I think it's a different status game as well and one that like might not even work. Like I kind of there's like a fork in the road. I think it's like, okay, it's a different stat, like live stream plus token is a way different status game than live stream. So, I think you need new creators for a new status game. But then like the fork in the like the other side of the fork is that um like I don't know, live stream plus token like kind of sounds silly and like we could all be here in a year like thinking like why did we think that this was going to work? I don't know. There's experimentation around it. Like I think like a multi-token kind of live stream where you're like kind of trading against like an outcome or like a a yes

no market or what whatever like maybe that's maybe they can set something like that up. I don't know. It just seems kind of far out there and it's a it's a blank canvas for a lot of experimentation and who knows if that's going to work. >> They should onboard Mr. Beast. >> That's Zora is doing that right now actually. So we need >> Oh, I forgot. Yeah, we got to do the math on. So, like what are the odds that Mr. Beast goes? >> Who posted that? Who posted that? >> Is anyone talking about how Zora has stopped?

>> No. >> Like I don't think it's fair. Everyone talks about when Zor is doing >> No one talks about when it stops. It stops all the time. >> This is not a good idea, right? >> The first person on the internet to have acknowledged it. >> Define stop like the the meta stopped. I'm getting the data >> like the like the trading volume is back to pre Coinbase base bankless marketing campaign. >> Yes, I'll give you >> anyone. >> Which is when a token trades low enough and it starts going up in price and it's users own the token, they start to generate activity on the underlying application.

And if the application has product market fit, that activity will be sticky. And if it doesn't, you will see churn. Getting the first part is somewhat of like a path dependency. The second part 90 plus% of the time is going to like have it go to zero eventually. So like that's all to say like I I don't think the outcome here is like bad. I think it's like always to be expected that 90 plus percent of the time this thing is going to go back down because it didn't find like true product market fit. Um, but yeah, I don't like the like disingenuous like shilling around it where like people can't be honest about the fact that like we're experimenting, it may go wrong. Like the reason it's

going up in price is partially a function of like ETH going up in price rapidly. This being like a quote unquote beta play. Um, so I know that's my rant, >> right? Yeah. No, it's the future. It's changing the dynamics of creator monetization right before your eyes. Coinbase will be the next social app. >> I think that's a bit unfair. Sorry, James, finish up. Yeah, I'm being I'm being sarcastic. Yeah, I >> it is kind of the pump story with streaming as well. So, >> yeah, >> all I was going to say is like we we keep I keep saying it. I feel like talking to people about this stuff is like normal people in the world do not want every single aspect of their life financialized. Like they just [ __ ] don't. And people need to just stop.

>> I stop trying to monetize your social media networks. It's just [ __ ] never going to work. It's why it's why Gamefy didn't work because people don't want financial like people hate making financial decisions. So when you when you force them on people, it's like creates a negative experience. >> Like think of how much people in the US hate math. No one wants to do math. >> Okay. But this is also like the wrong I think in my personal opinion there's like two things that can be said to this. First of all, most of the internet most of the content created on the internet are created by professional content creators and not by everyday people, right? So like realistically you only want to onboard those people and then those people tip or watch. So I don't know if this works in the Zora thing but like with streaming you can

clearly see this. The second thing is more people broadcast their life now than they did five years ago than they did 10 years ago. So there's no like I'm not saying I'm not doing the Jesse Pak we're bringing the whole like >> no but the but all the modifications but >> I'm just saying there is a reality in which V2 of this product of Zora is better than the V1 and in 5 years 10 years >> oh it's fine but like the monetization for all the stuff you're talking about it's it's all real but it's all abstracted away from the end consumer like no one wants to come home and Like it's just like no one's going to come home and they're doom scrolling in bed and they're going to say, "Hey, I love

that post. Let me buy 0.4 Zoro worth of the the post that was coined." Like it's it like it it's just such an absurd concept for a normal person to understand. >> Technically though, that is already a thing. Like I think has a part here about it. It's on every platform nearly like if Reddit you can, you know, gold pay to gold a post on live streams. who can, you know, explicitly pay to donate to a streamer like this type of thing. Uh, I know it's different than like having it be a token and a coin that you like buy and maybe then that coin goes up. Um, I think that's a bit more different of a dynamic.

>> Just thinking of like what I I don't have the numbers in front of me, but like the the data consumption of people on Tik Tok and Instagram that are scrolling through those types of feeds just like dwarfs anyone that's on Reddit and like tipping on that stuff, right? >> Yeah. And I would agree with you. I think there's like two I think there's like two markets here. There's like a general market of like the mass media consumer who just like wants to watch the funny video and then there's like you know the people that trade CSGO skins and that's like their whole life and you know there's the CSGO skin marketplace is like you know multi-billion dollars for just think you know items that are traded on the Steam marketplace >> to be fair. So I used to trade CSGO

skins. That's how I got into crypto. um a lot of that activity is money laundering by like financial uh criminal organizations in Europe and like there are other aspects to it but I don't know I wouldn't use like CSGO as justifying the existence of like financial speculation in games and and media like I I think there's a very big difference between like the user behavior of like tipping people and paying for something that they enjoy versus speculating on it. And I think the main difference is that if you're speculating on something you enjoy, like your enjoyment of that activity is going to be intrinsically linked to like how

much money you're making. And like more likely than not because these like tokens like generally get rugged by creators and like these creators launch coins on multiple networks, etc., etc., like they're going to have bad price action and so that's like very hard to like bootstrap a network with. So, I'm I'm skeptical of the behavior of like allowing people to speculate on like social media where like the things they're speculating on like just don't really have value. Like you may get like an occasional path dependent like, oh, this picture pumps to like a few million bucks and some loyal users, but I don't think that's like something that people should count on.

>> What is CSGO? >> No, >> it's a it's an FPS. It's a shooter game. Counterstrike. >> Counter Strike. >> 55 shooter game. know what percentage of of that activity you think is money laundering? >> I couldn't say exactly. Um I'm sure if I went on the internet I would have a perspective. Um but like I haven't traded CS GO skins in like 10 years at this point, but like back when I was trading it a lot of it was transitioning away from like loyal users of the game to like nefarious activity. Um, and so they like on the Steam marketplace made changes in order to reduce some of these like >> issues within the game. But like today CSGO is not played as nearly as much as what it was like 10 years ago. So you

have this financial market as like this game like kind of slowly fades into relevance. So it's kind of interesting that it still has such a large market cap associated with it. >> Yeah. I think the point it highlights though is that like you can have these like niche financialized products that appeal to a select group and if those if that group is willing to you know like whales in video games, right? Like if if there's if you get a thousand players that are all willing to dump 20k a year into your thing for whatever reason, they're addicted to it. They just love to gamble. You know, it's their favorite game ever and they're rich. like that's great and you can make money, but it it might not be a mass market appeal app for a billion users. Like there can be two different games there.

And uh maybe Noah, just to highlight your point, like uh we we've just seen this several times over with Zoro where, you know, the base and like ecosystem kind of pushes the, you know, the newest update, the newest narrative for it. um they get a spike in the activity, but the coins just don't trade well consistently and we see the volume fall off. And it's not something they've been able to um to fix quite yet. Even though I can pull up the post metrics, but like total posts have continued to like reach, you know, higher highs and higher lows, but um it's not been meaningful to the trading volume.

>> One thing I will say is that point is very very important is that you might just be able to appeal to like a very small group. And to me, like I wrote about GameFi maybe a year and a half ago now, like the only report that I've written on GameFi. And my central point was that I don't think it'll work in the mass market thing. But I think there are games where it's so like like I only play one video game, right? And like I have an embarrassing amount of hours in it, but I it's like a map game and I just stare at it and that's it. But like if you can find those types of communities like and try and monetize that way, I think there's a way to do it. Like CSGO is one of them. Um because people who play Counterstrike, like they

only play Counter Strike and they play the same map over and over again. Um but I don't think you can monetize. Like people are always like, "Oh, what about like FIFA Ultimate Team?" No, nobody wants to [ __ ] do that on FIFA Ultimate. Technically, it makes sense that you can pull up the numbers and like with the pack opening, yeah, there's a loot box element. You know, we could really make some money off of this. I don't see like I know I have friends who play FIFA Ultimate Team. I don't see them ever doing like a monetized gaming thing. Um, I think the same thing with it was with Zora. My perspective on this is that Ryan kind of Ryan and the people like Ryan got into the heads of the Zora people, which was like, oh, you need to have like charts and like coins that you

can trade. But I think Zora would have probably done a little bit better if it was just like the sparks and you get to like them and that's it. Like you get to give people some money and they get to give you some money and that was the whole game. And it's not like everything you post on the internet is a coin and you are inevitably rugging people every single day, right? >> I think the the last part there is the most critical with regards to like rugging people every day. like if you can create like a financial instrument that like doesn't go down and like directly drifts up that probably can induce a fair amount of user behavior and I think like the issue that a lot of platforms and this probably touches a bit on launchpads as well is that like if you're like building a product under

the predication of like it doesn't take that much effort to build this the opportunity is I can make like 10 million bucks you're probably not going to stick around that much and like similarly ly to the people that are launching tokens that like are doing it as like meme coins and stuff like the premise isn't for them to like be valuable. It's for them to pump and then like dump. Um and so I think like if you have like a creator for example that like says this is my token. It's the only thing I'm ever going to use to represent the value of my stream. I'm going to pump value to it and like I as a streamer like continue to find success. That might work relative to like the current streaming model. I just think like we haven't really seen that many people that like actually have the

like morale or ethics to say like I'm gonna stick this token and like find a way to make it work. It's mostly people that are like playing very short-term games. >> Ryan, I want to hear your thoughts on especially the the creator coins and the chart thing because you want them to launch charts in the app, right? Like that's your dream. Yeah, it's my dream. I I think about it often. No, I I think um yeah, the my spiel is um you know, Zora is a launchpad and in order to get alignment with the youth folks, they can't say they're a launchpad. So, there

has to be like for some greater ethical goal, which is often the framing of the products over there. And the greater ethical goal is creator monetization. And so in order to like frame the product in that light, like you strip away all the useful features of a launchpad, which is everything that Axium and Pump have and leave behind something that looks like creator monetization and that actually because it is a launchpad at its core, that strips away all the usefulness of the product because launchpads have achieved BMF. Like whether we like it or not, there are tens of thousands perhaps millions of people around around the world who have engaged with memecoins on this like little game where you try to

make as much money in as possible in a very short period of time and then it goes to zero. Like that's not something that we've had before explicitly, but that's how a lot of games work, right? Where there's some like percentage payoff probability that you're tracking over time and then you either cash out or it goes to zero. we've never like had it in chart form. So like that's like the whole game is trading that chart and that's what a launchpad is today and it is what they built like functionally and a lot of the efforts have been to I think strip away all the useful features. So that that's that's what I think the fundamental problem is is over there and I think that it probably becomes you know bass needs kind of like I think

that that ecosystem like these are all very siloed ecosystem still and I think base would probably really benefit from leaning into like a silly launchpad because that's that's what people want. >> They had a few to be fair, right? They have Flaunchy and Clanker, >> right? But there that's in the context of like UX issues. So like the reason that they all end up being on Salana is like the game is just like it just feels a lot better on that blockchain. So you know you're going to have this kind of like cap on activity on any kind of launchpad product because they are high throughput products.

>> Yeah. And also Bass likes to do this thing where they'll launch a product and then they'll make it like really useless. Like you can launch any memecoin you want but only on Farcaster. And it's like, what the [ __ ] does this even mean? >> I do think um I like what Noah said about like we we we understand inherently and those in the trenches understand that like the exciting part of this is the pump part like when the price of the token goes up. Um and I do feel like the points you highlighted there, Ryan, and I think that we've kind of covered on Zora, um sort of explain like how that's kind of at odds with using the platform. Like if you're a creator and then you have a thousand posts in a month, it's like you can't

keep all of those post coins going up, it's just like not going to be possible. You're probably getting rugged on the daily if not five times a day just because there's so many point posts and the attention is like rolling from one to the next or the bots are flipping in and out of those. Um, but there is something in terms of like kind of having to square this circular peg of like if pump fun streamers for example are now attaching their like identity and streaming presence to this one coin like rugging people shouldn't be the goal. The goal then should be to like pump the coin. the coin should go up like ideally as maybe they grow in popularity, virality um and maybe other mechanisms to where like they do have creator earnings that are sourced from like the

trading volume, fee volume on the token. Um, so I don't know. I think that they'll have to kind of experiment around like, you know, putting those fees back into the token or doing XYZ other thing like for to see a really like exciting successful outcome there because otherwise you suffer the same problem of like if a creator can hop in, pump their, you know, get their token pumped to 200k and then it and then it rugs, um, that's not really going to be exciting for viewers. You want you want the tokens to keep going up. >> Yeah. I and for what it's worth, I am skeptical of the creat the creator monetization framing for Pump as well.

Um I'm pretty skeptical of it, but I think Pump is generating a enough cash that it can be and it has this brand name and it has some degree of distribution. It will it it's best positioned to run those experiments with these like ultrash short-term tokens or just like mass issuance of tokens. So there's kind of like no better place to like run that experiment than where all the users are doing weird things. >> Danny, should we do 10 minutes of USDH or do you want to do something else? What would you like?

>> Yeah, let's talk about it. You you you lead in. You you're way more deep on that than me. Um, actually, let me get a like a Do we want to talk about this, James, Ryan, Noah, or is this not interesting? Because we can do anything else. >> I don't I don't know. I don't know anything about anything technical, so I have no value to add. I'll just listen. >> Um, okay. So, as you guys know, Hyperliquid has a ticker for sale. Um, well, the rights to buy a ticker called USDH. Um there are lots of discussions.

So there were like nine proposals made. Um the big ones were native markets, um Ephina, Agora, Paxos, Fracks, etc., etc. So FRA building out another product as well. Very fun for them. Um and then now there's like a lot of drama because um people are worried that the governance aspect isn't going very well and they don't know who to vote for. I think it's between Pax sauce and native markets now. But if anybody else knows better, correct me. Um I'm just curious like have you guys seen anything about it at all or is this something that's been like completely

uninteresting to you because the stable coins on Hyperlid and you're like I don't care. Yeah, I'll um the most recent stuff I've seen and I'm just going to throw in some of the context that I've seen thrown around on TT for example is that like it seems to be the core of this right now from what I'm reading is like native markets. You have Max who's like um hyperlquid ecosystem, you know, kind of maybe aligned individual maybe well known within the community um running this like kind of new startup to to support this USDH endeavor. And then um it seems like really Paxos has been the only meaningful competition. And from what I've seen from Paxos, it's they've been attempting to utilize maybe their

existing connections to like really beef up a you know, a really attractive proposal is what it seems. So it's like, you know, we'll use USDH and PayPal and Venmo and you know, we got Kraken on board and XYZ this that and the other thing. Um, and it seems to be coming down to like this argument over whether um I don't know. I see a little bit of like was native markets kind of chosen from the beginning. I don't know if that's really true or if it's just like >> I I don't sorry >> just saying people are going back and forth between like do we think Paxos is like meaningful enough as a brand or connections or like their history of success or growth versus like um this hyperlquid native ecosystem guy that

seems to be the crux of it. >> One thing I'm going to say here is which I think this will be a fun one to talk about. I don't think native markets was already chosen because they've already done an already chosen thing with unit clearly gave unit the rights to buy UBDC you soul etc. Um like they they launch they spun it up pretty quickly. Hyperlid very rarely tweets about people but they like tweeted and tweeted about unit a few times. So I think they had the precursor to be able to give some like anointed stable coin. Um, so and they didn't, which makes me think that I don't think that it was like something that's already set to go. Uh, if anybody has anything else that they don't

believe is >> the the big thing is that Hyperlid gets the revenue, right? >> Yeah. Oh, and I'll chat about that later as well. >> Yeah, that's I mean to me that's the I mean there Yeah, there's some controversy here for sure. Um, but the most interesting thing is kind of their the power that they have and if other chains and if other chains like have are probably now thinking that they have the power to do the same thing, but I I don't know if that's true. Like I don't know if the other chains have the power to do that, but we'll see.

>> I don't think they do. Um, yeah, I'll give some like on the revenue side. Um there were some pretty ridiculous proposals like Agora was like oh we'll just give back 100% of all yield and we'll use it to buy hype. Um which is not that meaningful at like low like it's not that meaningful overall because hype already makes a lot of money. Um so it's not like a huge addition to it but it is also like a potential 100 to 200 mil clip at like 3 bill to 5.8 8 billion supply um into hype which is not bad definitely.

What is this? >> Zucky in the chat share um where voting power is right now. So it it does seem like um native markets is kind of running away with this one based on where current like votes and delegations are sitting and the poly market like we I was showing that before. Um, I think there was a little bit more of a battle here a few days ago, but it it maybe since some of the initial like votes have come in, it seems like the market's really converging on on >> Well, if also dropped out. They said they don't want to participate. Um, they withdrew respectfully. Um, and they just said we'll just launch it on our own.

We'll just buy another ticker. Yeah, it I mean from an out I'm not a hyp I'm not an expert on like the hyperlquid kind of like community stuff, but it seems odd that they're all fighting over just a ticker >> if when they can launch their own product if they want. >> I don't see the like I don't know USDH is not the first thing that comes to mind when I want to type in a stable coin, >> you know. Yeah, I I mean it seems like the the piece of this is that you become like the anointed stable coin of Hyperlid and maybe that's meaningful enough to then um build out additional products alongside that and further

monetize within the ecosystem. But um yeah, I mean I do generally agree with the point there, >> Ryan. Go ahead. put it out there that I've had my fair share of experience in decentralized governance over the past five or six years and have worked at funds involved in decentralized governance and kind of have seen how this all goes and same thing and that's all the preface what I'm about to say is not meant in a negative perspective I just think people need to understand how the game works which is Everything is discussed and handshake agreed upon

before it goes to governance. Hyperlquid is not unique. We can argue like how much of the handshake took place like what explicitly was guaranteed to them. Was it just like oh put up this proposal see who else comes. If nobody else comes it's it's yours. I don't know. But like you have a few like pretty successful and meaningful people in this industry that work in native markets and native markets is doing nothing other than uh creating this USDH product as far as like the public is aware and like native markets has been working on this for at least 6 months if not 12 months and it just would seem odd to me that they wouldn't be like using their like Max wouldn't be using his network and hyperlid to like back channel with

validation and say like we want to do this. Here's how we're thinking about the product. This is why we think it would be beneficial for the ecosystem. Um, and I don't think that's like a nefarious thing. I just think that's what like a rational actor that's approaching like a building out a business would do. So, I don't think like they were guaranteeing the win to native markets, but like there definitely was a lot of politics going on before the proposal hit the Discord. >> Yeah, I can I'm not sure. The thing is that every time I've spoken to Hyperlid people, they've always said that they actually have very limited communication with the team to the point that it's slightly annoying. Um, so I

in my my personal opinion is that I the thing is that on the one hand like I know that governance in general is mostly a farce and I'm cognizant that me saying no this time is different sounds silly. But on the other hand, on the other hand, >> I am also like from my experience, from what I've heard, it seems like if this was the case where it wasn't there was maybe some discussion behind the scenes, um but it wasn't like particularly nefarious, I feel like it would be the Hyperlquid team. Um however, I am financially invested in Hyperlquid and this might lead me to be more of an

optimist. um just like in general I imagine it was at least less nefarious than what you would probably see in some of the other ecosystems uh which I don't think is very >> how many validators are run by the team versus not now >> five by the team there's 24 in total so 19 I think there's 24 in total by the way added a few >> you could be right and it and like you could both be right by your both of your statements here in that he could have not been spoke speaking to the team but been speaking to all the other validators up to this point and securing their votes prior to this ever went this ever going live.

>> Yeah. And that's not bad. >> In which case you're both right. It's just I mean that's just how you operate to secure stake. >> But yeah, I mean I agree I agree with I think with a lot of what's said here. The the thing is that I also don't know if Pax sauce is that good of a like is that good of a proposal and that's something that if you guys have read into it we can talk about but like the big names of PayPal, Venmo to me seem more like I don't know it's not like it's good distribution but I don't see why Pax sauce is the almighty great. I like Max I if you guys can can't tell I like Maxvia and I like Native Markets. Um, but I don't know like Paxos's big

selling point is we grew Binance USC to 25 billion. I could have grown Binance USC to 25 billion. Like it's a Binance is USD product. It's not that tough. Um, PayPal and VMO and stuff. I don't know. We'll see. We'll see. >> What are your thoughts there, Noah, on um just on Paxus or do you have any >> strong opinions? Um, yeah. I I don't really have a strong opinion on like who deserves to win this vote. Um, I just have an opinion on like how the vote is determined.

>> Yeah, I think that's fair. Um, I think it probably uh hyperlquid governance is V2 of governance and it's always better than V1. >> No, but I I can't imagine. I was thinking about it. I don't think you could have ever done this in a good like I think just in general governance is not I actually really like the way that Hyperlid did it the original time which was just like you know the team at unit you know they can build it out just let them have it and they just built it out right like I I think that is probably the best way of governance and that the team who you trust who are relatively smart and know their product the best out of everybody else they just get to pick and that's how it goes or you just make it completely permissionless and

you can just buy whatever ticker you Yeah, that's good. >> Centralized governance is how most early stage companies move forward. >> And like sure, Hyperliquid's like the same size as NASDAQ now, but that doesn't change the fact that like they're early in their product buildout and like they probably should have a fair amount of centralization as far as how decisions are made. So that's that's kind of where I land on this whole situation. >> Yeah, I agree. It's I I think this is like these are some of the reasons why you would probably dog ETH right for sitting around and like having the nth vote about should we let Raspberry Pies you know be the most important part of the network. Um you know having a very

like streamlined decision-m process um and you know aligning around those goals is is meaningful. Uh it does give me a little bit of like flashback to Cosmos governance uh quarrels from from last cycle but it's not really quite not really quite the same thing. The difference is that the underlying token here is going up. So that's the big >> big one. Um, >> do you want to do you want to roll us out? >> Yeah, I think we can call it there. Um, maybe I'll let you roll us out. Um, if you want to give a quick shout out to the Xerox Research newsletter.

>> Yes. Um, Ryan, do you want to give a quick but you're not on video so it might not be as good. Guys, Zerox Research has a newsletter written by the Blockworks Research Analyst team. We do a lot of um market updates um as well as we do a top of- mind section where we cover what we find interesting and oftentimes that ends up being um related to the reports or the flash notes that we're going to write. So, you're getting a sneak peek into um the Blockworks Research product itself. Um we use a lot of our own data as well. So, if you want to check that out, that would be very, very good. You can find it by searching up Zerx Research newsletter on your favorite search engine. Um,

and there's a QR code at the bottom right. >> Daniel, check the show notes. >> And you can check the show notes as well. Um, >> I think that's it. Ryan, do you have anything you want to say about the Blockworks Research newsletter? >> Uh, it's very good and shouldn't be free, but it is, so take advantage. We're doing a lot of stuff. Me and Ryan fought about the title this morning. So, it's it's it's a very fun process for everybody involved. So, please make sure to subscribe to it and check it out. >> Oh, actually, you know what? One other thing we um right now, since we were talking about Hyperlid, we are you're getting you get access to uh one of our Hyperlid evaluation reports, recent Hyperlid valuation report if you

subscribe to the Blockworks research newsletter. So, that link is in the show notes. check it out. Um, you can read that report and also read the newsletter. Some great insight there that otherwise would not be free. Um, which Ryan prefers. Uh, but anyways, we can we can close it out there, gentlemen. James, Noah, Ryan, uh, thank you guys for joining today. Uh, hopefully we can get you guys on more frequently when you are available. Um, but I feel like we had a great chat today. Great to get your insights >> and awesome. Thanks for having me, guys.

Enjoy the weekend everybody. Touch some grass. >> See you. >> See you guys. [Music]