Claude Code, Stablecoin Adoption, and 2026 Trends | Weekly Roundup

I think we're going to continue to see this sort of existential kind of hollowing out of the middle in crypto venture, uh, and we're going to see more of the things that work get gobbled up by, you know, the generalist investors. The crypto VCs are going to have to figure out how to adapt to that.

Nothing said on Empire is a recommendation to buy or sell any investments or products. This podcast is for informational purposes only, and the views expressed by anyone on the show are are solely their opinions, not financial advice or necessarily the views of Blockworks. Our hosts, guests, and the Blockworks team may hold positions in the companies, funds, or projects discussed. Welcome back, everyone. I do exist. Sorry I missed the first pod. I heard ratings were pretty good, but Nikita Beer crushed crypto Twitter, so I don't even know why we're recording, Rob. Even if we're—

He can't crush the pod though. He cannot crush the pod no matter what he tries to do.

We're gonna have to go direct to our listeners and, but yeah, man, I feel like, I mean, Kaido, obviously we should talk about that, but I don't know if it's 'cause I'm tweeting less or my tweets are less relevant, but I'm getting very little engagement and my timeline is just not crypto related at all. Like I'm seeing more Warren Buffett and AI and, cloud work and stuff like that. But is that true with you, Rob, too? My, my experience with Twitter has totally changed.

So, well, it's different for you than it is for me too, 'cause you've got like, what, 150,000 followers, right? And you know, your engagement is like some level much, much, much higher than mine, right?

But you should, you should track it as like followers to engagement. That's when you know people bought a lot of followers. I think you get pretty good.

Did you buy a bunch of followers?

No, not at all. I didn't even do the, the pomp hack of like follow, unfollow, you know what I mean? Like that was like a, a thing back in the day.

What, what is that?

There was this hack where you could like follow a bunch of people and then unfollow them so that once you follow them, people would follow you back. So that was like a growth hack back in the day. But I, I, I've not done any of that.

Got it. Okay. Well, I've not done that either. Apparently I need to learn more about how to, you know, grow my, my follower accounts. I got a, I got a measly, Like, like under 15,000. So, you know, measly like 10% of you.

Prediction of the year, that goes to 30.

That's your prediction of the year?

Uh, unless markets nuke and like there's no sentiment. Uh, but that, that grows a decent amount, I would say.

All right, let's go. All right, you gotta follow me. Um, no, so, uh, but I will, I will tell you, uh, so I mean, it makes sense that everything is AI right now. Like that is just like generally true, right? Like AI is like eating everything. I mean, Um, I don't know if you've used Cloud Code, but like, I earmarked a bunch of time this weekend to play around with it.

Have you?

Uh, yeah, so we're, we're playing around with it a little bit at the firm and it's the first time where, I mean, you've seen a bunch of people tweet about this, but you don't have to be technical at all and you can like build something that, you know, is really works. And you know, it's not, you're not gonna build the most complicated thing in the world, but you can, take, you know, what would take a software engineer a week or two, and you can do it on your own, uh, in an afternoon, uh, with Cloud Code and not be technical at all, right? Like the world of software engineering has completely been upended and changed with Cloud Code. And you know, we, we've talked a lot about Cursor and, and maybe not on this pod, but you know, more generally. And these things are obviously being used like very broadly by engineers. Cloud is the first time that you can be a normal person, you and I, never done any software engineering, and you can build something that's really cool. And so like, that is my, you know, my expectation is like, that is going to like eat a lot of the conversation 'cause it should, absolutely. And then I think Warren Buffett is just because you're in your, you know, fundamental like, you know, value investor, you know, era right now. This is, we should like superimpose Warren Buffett's face on top of you in the next, the next empire.

All right, well, I missed for price to sales, insert Patagonia vest meme. Here's a little price to sales for everyone out there. You didn't think I was done with this, right? Look at this. Talk about cloud work and what AI is doing. This is, you're seeing, for anyone listening, this is a chart showing 2021 to today multiples price to sales for SaaS companies, software as a service. You know, you have Salesforce and Adobe and HubSpot and Okta and Workday, some of the best sales, like back in the day they were the darlings. That multiple's gone crushed since, like you could draw a line of when OpenAI like started and like when it really accelerated and multiple is now, back in the day it was like over 30, 35 times price of sales. It's down to 5. I'm paying attention to that. I think, uh, I think there's some, some value there potentially. Um, but I've also heard a lot of companies like on renewal saying, wait a minute, they're trying to jack up price. Not worth it. Um, when cloud is, you know, I don't know, like, what is it? Manus is like $40 per month per user. It's like a bargain in my opinion. But yeah, this is pretty crushing by the way. This one from 40 to 5. Who knows where it goes from here? As a gentle reminder, crypto price to sales for most networks are in the hundreds range. Maybe 60 is like bargain levels, but I'll leave it at that. Interesting observation on Cloudwerk. How are you, what would you prototype? Like, I'm curious, like maybe we should save this for another episode, but I'm actually really excited 'cause I'm not technical, but I do have a lot of ideas and like I talk to my engineers and be like, hey, I want you to build this. This is like how a financial product would look like for a company we acquire, like go and show me a demo. And now like you and I can do a demo. Yeah, it's great. A demo would have taken, I don't know, 6 weeks or 4 weeks to do. Now it's like a day less.

It's, it's actually crazy. We, we've been doing some like little stuff, like, you know, just managing and automating certain workflows, like being able to take, you know, all of my notes from some calls and you know, build a, you know, kind of a, a really interesting like CRM and, um, digging out like tidbits that maybe I wouldn't get otherwise. We've done some stuff around like an actual pretty, um, interesting tracker of like our deployment pace and our categories around our deployment and, you know, some, some different things. And no longer do we need a software engineer to do it. We, you know, we, we have software engineers here. I mean, uh, both Asiv and, and, uh, and Tom have, have coded in the past, um, but we like— now I can do this stuff, right? And you talk to the guys at Anthropic, and like, they're— I, I heard this from somebody else, not from someone directly at Anthropic, but that, um, one of the engineers Anthropic was saying now 100% of the code on Claude was being written by Claude, right?

So Claude Work was built in 10 days, 100% by Claude.

Claude, yeah, it's, it's crazy, right?

Um, you and I talk about hiring at the board level. I will say like, we are obviously paying for these tools, which I think are bargain because we get so much productivity and everyone on the team is like, you need to be an expert on this. You need to be on top of it because you get so much value. But I think we're, it does beg the question of like, I've always like in my venture investments and talking to founders, they always will tell you that they have one or two when things get tight and they need to cut budget and they need to cut staff, unfortunately, they'll say like, there's always that one or two engineers that they're like, we just cannot let these guys go. Like they're 10x engineers. And I'm like, well, why didn't you just hire 10x engineers? Right. Um, but you know, I think, uh, it really forces the question, like, I don't know if you're seeing it across your portfolio, but what is, What does the pace of hiring look like from here? And how do you think about like building teams? Because before that, it would have been like a very important thing that you would discuss, like, hey, you need to have like this organizational structure to support the backbone of a company. And typically this is what, you know, these functions that you need to fill. I can tell you from my perspective, like we're lean and mean and I don't necessarily You know, there's certain roles that we're not needing now, for us at least. Are you, are you seeing that in your book, in your portfolio?

Yeah. So one of the questions, I mean, one of the questions I ask, uh, all of the founders now is, uh, you know, not, you know, really early, but as you know, we talk about Series A and Series B, Series C is, you know, how many of your commits are at least AI-assisted, right? And at this point, it should be close to 100%. Right? It shouldn't be, shouldn't be far off from that for, you know, people that are generally, you know, uh, just software companies. It's always been true in crypto that especially on the open source protocol stage, you just needed less employees, right? Like there was the, the, um, the type of software engineering here did not require you to have, you know, a huge organization, right? Um, and so that's coming down even further for sure. Uh, and now we're seeing this happen in, you know, traditional SaaS. We're seeing this happen in, you know, uh, across AI. There's a lot of hand-wringing right now, and I, I don't invest in this space, so I'm not as deep as, as maybe I should be, but there's a lot of hand-wringing right now about the fact that potentially there's, you know, all of these organizations, organizations are spending a bunch of money on, you know, Microsoft Copilot and a bunch of AI tools. and then they're like not using it. Nobody's using it like appropriately. And so there probably won't be all these re-ups. And so we're a little ahead of ourselves, but it sort of feels to me like the pace of change, the pace of additional productivity is outpacing like anything to do with, um, you know, hey, this, this, you know, piece of Microsoft Copilot or whatever doesn't work very well. It's just going to get good enough that that won't matter and companies will keep spending money on it. But yeah, it, it should be changing the way every single person is doing work. Totally.

I always tell people, you're not gonna get fired by an AI. You'll get fired by someone. You'll be replaced. You won't be replaced by AI. You'll be replaced by someone that really knows how to use AI. Yeah. I am, one, one other thing that I was thinking about is like every time, like there's like a race, right? In AI going on, like every LLM, like from ChatGPT, Manus, all these companies. And I feel like it's, it's having like this creative destruction in real time where like, I have kind of sympathy. I think about like venture funds investing in AI, like how many of them have like portfolio companies of theirs have gone to like zero because there were wrappers and all of a sudden like ChatGPT enabled that functionality and you're kind of cooked at that point. It really begs the question of like, what is the moat? For certainly like existing businesses like Workday and Salesforce and HubSpot. And what is the mode for like on the venture side? Maybe the question relevant for the audience is like, how does it impact like crypto? I could tell you from my standpoint, there's like 5 or 6 portfolio companies of mine that I invested in that were like doing automated like threat detection on smart contracts. Now I think there's like a larger player, traditional player coming into the space and I forget who it was. It was quite notable. And I was like, okay, well, you could almost see the writing on the wall for that type of very niche-specific company. But it is chaotic. I do wonder like if you're, what's going to be the performance of these AI-focused venture funds that made a lot of investments and maybe the better investment would have been just like punt the S&P.

Well, I, I will tell you, I bought, um, I don't trade a lot of equities. I'm usually just like kind of long ETFs generally. Uh, the thing that I actually bought today for the first time, and this is the first like kind of sector-specific ETF I bought in size for a long time, uh, and it was SHLD, uh, which is the, like, it's the defense technology, uh, defense technology ETF. Because I really think there's like two things, there's like three things to go long right now, which is innovation in crypto, innovation in AI, and seems like global unrest. Yeah, those are the things to be long right now, unfortunately.

Goddamn it, Rob, we're just starting the year. You can't, you're all, you quoted, you tweeted me about, there's something about your prediction for the year is all positive and you're calling me a bear and all of a sudden you're telling us here the world's going to be—

Positive in crypto.

Yeah.

Um, AI and defense.

But even, even then, like, so I, I'll tell you, I've been doing a lot of thinking over the last couple weeks. Uh, I've read like just a ton of books on like really off of social media. I don't think I'll ever come, like, I'm tweeting way less or just reading more and just focusing on what I'm doing. Um, it's crazy to like read like historical anecdotes. I'm like, I read like the guy that ran the banana trade, Ted Turner, or like Boone Pickens, like all these guys across different centuries and eras and sectors. I read this really good book of Zam Sell that I've talked about on the pod, and they all kind of say the same thing of like, you really need to deconstruct an investment thesis with supply and demand. And I tell the analyst teams, like, if you don't understand supply and demand, the curves and shocks and what can really— then you haven't really understood a company really well. The reason I bring it up is like, this creative destruction is very real on the supply side. Like, the demand side for AI is like super strong. The demand for crypto is you could argue, tied to macro and other stuff, uh, but it's growing. So like, I feel like most people don't disagree, like the demand, the aperture of crypto is growing, stablecoins are going to grow. So that demand is super strong that you can, you can underwrite a hockey stick of, of stablecoin growth as an example. And you've been very vocal about that. But really, I think where you make most amount of money is if you really understand the supply, the, the supply curve, like what is, how How inelastic is it? Maybe a company has a different slope than a, than a, an enco— like a, a disruptor. So I, I, I like now of, of the mind that like supply is the most important thing to understand for you to make money. 'Cause the demand is fairly easy to underwrite as stablecoins as an example, you know, like for instance, for instance, Rain, right? Like what does Rain supply curve look like? 'Cause I think that forces what is the moat of that business in a world where everyone will want to kind of, play a part in that. And you have legacy players that have some sort of business that can eat into that. And I mentioned Rayn because it just obviously raised a great round. You guys are investors, like one of the fastest growing companies in crypto. You've been talking about constantly on the pod.

Yeah, listen, I think you're right. Where I'm speaking at a leadership summit for one of the largest asset managers in the world next week. Around like broadly what like stablecoins and tokenization are doing to their business and what that could, could mean. And I bring that up because I think a theme that I'm going to have in that conversation and a theme that I've— that's been around more broadly, we've been talking about it a little bit also on the prediction market side, is that there is so much demand for new novel financial product, new asset management, new wealth management, stablecoins, Uh, there's so much demand for prediction markets, right? And it seems time and again that for these things that don't necessarily have really deep moats in terms of the tech, or really deep moats in terms of, you know, some sort of like regulatory moat as well, which are also are going away, that a lot of these things are are more and more than, than I've had in probably my entire investing career. It's really just been about like, how do you distribute? Who— what is the top of funnel? What is your aperture to bring people, um, into your product? And Rain's a very interesting story because I, I think I agree with you that there are very few businesses that I look at today where I, I say nobody else is doing this and will be able to do this in the near term. in any way as effective as this company. And so they have a quote unquote supply moat to your point, right? Rayn is kind of that company. And, and we can talk about like, you know, where there are others in crypto, but on the prediction market side, like obviously a lot of people can launch prediction markets. Kalshi and Polymarket are by far and away the biggest. Um, they have, you know, I would say a head start, but they wouldn't have what I would say kind of an indefensible moat. Rayn, uh, on the other hand, has kind of this full package of like the best tech. They have the regulatory moat in terms of having their, their MTLs. Only a few people have that. And as well as their, some of their international relationships and, uh, and kind of regulatory licensing, as well as this, you know, kind of preferred principal member relationship with Visa, which is very hard to get. And you bring those three things together and they have like a head start that essentially nobody can, uh, in the market can compete with at the moment. You see, Bridge and Stripe have been trying to launch a product for a year that, you know, still they haven't really been able to, and it doesn't really work. Um, and because of that, because of the fact that they are essentially, you know, it's not a sustainable long-term monopoly, but this kind of short-term monopoly, um, they've just eaten the entire market and they've grown by— I mean, I think they publicly announced that they've grown over 40x on the year. I can tell you in the 15-month frame, it's actually a much bigger multiple than that. And they've— because of that, they raised in, you know, over the last year, they, they raised over, you know, $330 million, right? Uh, from a company that was, you know, call it a million dollars of revenue, uh, 15, 16 months ago.

Yeah.

And it's an incredible story, incredible business, incredible founders. Charles and Farouk are awesome. And I think the Jason's actually doing a pod with them next week. Okay.

Yeah, I met him at the Avalanche Summit, which is a small gathering you were part of too. And we actually have talked to them a lot. And when I think about like using stablecoins in a way that consumers can use them, like not just hold them to speculate and trade in and out of pairs, it's very much a Visa card that, and when I find myself explaining how do you use stablecoins in a traditional business, it's always you close that loop by saying, people can receive dollars in a wallet and then spend them day to day. And that was, I think, one of the missing pieces that was needed to really stimulate the demand for stablecoins. So I'm actually very excited to, you know, we think about that a lot. What is, for anyone that just is kind of waking up to Rain, like what is, what is the double-clicking on the moat? Like they have a partnership with Visa, right?

Yep. And so they're principal member, so they do their own issuing, so they don't need a bank. So, so the way your credit cards typically work, if you have an Amex, Amex is the bank, they're the issuer bank, um, and they're also the issuer processor. If you have a, uh, say a Visa or MasterCard otherwise, usually it's a Chase, you know, Visa, right? Or it's a some other bank. And like, this is true for, for Bridge, like, Lead Bank is their issuer. So Bridge works with Lead to, to do that. And so there's, you know, different people in the value chain that has— you have to— the fund flows work a little bit differently, the way the economics work a little bit differently. Rain, because they're a principal member with Visa, in the places where they are the direct issuer, which is not always true with all of their customers, but in the places that they are, um, they hold like almost 100% of these called like interchange economics that would go to maybe different counterparties, and that they control, or the customer can control. In some cases they have managed and unmanaged but they can control 100% of the way the fund flows and you don't have maybe an extra, you know, quote unquote bank hop, it's just their entities, specifically. And so they then settle with Visa in stablecoins. Visa's doing, I mean, we talked about this, but you know, Visa announced that they were doing, you know, $3 billion of annualized direct stablecoin settlement. I think that's going to grow, you know, tremendously this year. And they can then—

You said $30 billion, I believe. I said maybe $10.

But yeah, I said $100 billion.

Oh, you said $100 billion. That's right.

Yeah.

Yeah.

So I, I think it's going, I, I think it's going, you know, way higher.

So what, why maybe the layman question here is why wouldn't Visa do this directly?

Well, Visa doesn't issue its own cards ever with anybody, right? And why don't they do that? Because they, they're the network. The idea around Visa, right, is that they take all of these issuers and all of these issuers have to use Visa to, for authorization and for, um, essentially like the passing of information around, um, KYC, and then use it in their network to settle from like the issuer to the acquirer, right? And so they want everybody to use their rails because, but they don't want to compete with, you know, the issuers themselves, right? Because they want all the issuers to want to use Visa. Now it's a little bit interesting because, um, Visa Direct is the fastest growing part of their business today, at least in terms of the transaction volume. So, uh, their services business is growing faster, but on the transaction side, Visa Direct is the fastest growing part. And Visa Direct is their— call it like alternative, um, off like the traditional rails system where— and they actually just announced a, a deal with BVNK where they can do these kind of like direct payouts through Visa Direct, and a lot of the Visa Direct business in like emerging markets, not through their traditional network rails. Um, uh, and so they're, they're really what it seems like Visa is doing is they're future-proofing themselves a little bit because they see that a lot of fund flows are moving off traditional bank rails, correspondent, um, bank flows, and especially for cross-border are, are getting, um, are getting eaten away at. And so they're saying, okay, well, we want to have these, call it, you know, stablecoin direct settlement with somebody like a like Arrain, and then we also wanna do Visa Direct, which is, you know, off our traditional, uh, network flows.

Yeah. Where is most of the growth from Arrain coming from?

So for them, it's, uh, they, they don't actually have a lot of customer concentration. They have a lot, just a lot of customers. So they announced publicly they have 200 cus— over 200 customers. Wow. At this point, uh, people that are, you know, and it, by the way, it doesn't have to be true. To use them that you have a, you know, a stablecoin or a crypto wallet. So yeah, I mean, they, they're publicly issuers of, um, like EtherFi's card, the public issues of RedotPay's card, um, they do it for Cast, they do it for, there's an Avalanche card. And so these are all people that have like a stablecoin or crypto wallet, right? You swipe it and it spends down your stablecoin balance. But they also have clients. I think they've announced, um, a, um, a Western Union partnership. Who, they might have stablecoins or they might have fiat. And if they have fiat, they have the capability to swap that fiat into stablecoin and still 365 days a year, 24/7, settle with Visa and stablecoins. So they're doing both. And so they're the only one who's able to do both with a direct, being their own issuer, who have the licensing and also have really, really good documentation, APIs, and the, the, the right kind of like wallet and logic infrastructure, uh, to do these kind of fund flows really seamlessly.

Who are the other principal members in that Visa network that could potentially compete with Rain or against Rain?

Well, so, so right now there's— I'm sure there are a bunch of people trying to get principal memberships today. The vast majority of people doing there's really kind of 3 players who are doing stablecoin-backed car. I mean, that's not true. There's more than 3. There's some others, I think Monovate in Europe, Exo I think is also a direct issuer. I think there's a business called Reap out of Hong Kong that is trying to do that, but they don't have the same abilities on the, on the like B2B2C side. And then Bridge is trying to do it, but today Bridge is using LEAD as the issuer. Most of the issuers on the Visa network are banks, right? And that's pretty typical. Rain's got a, I don't have to go in, they'll talk about it next week, so tune in on the pod next week about like how they differentiate between some of those other players. But they, you know, built this business for, you know, basically 2.5, 3 years with very little, I guess, revenue. They were, you know, building traction and proof of concepts. Um, and then we're able to essentially turn that on in a way this year that just, you know, accelerated like an incredible, incredible amount. And so, you know, I mean, when is the last time— and so for anyone who doesn't know, maybe we should start at the beginning, but, you know, Rain raised a $250 million Series C led by Iconiq, who is a legendary fintech investor. Um, and we were part of it.

Google guy's family office.

Yeah, originally, yeah. And then it— and then they turned into like a much broader, um, you know, LP base. Um, and, and we've been an investor, Galaxy's been an investor, um, and then the—

everyone else has been pretty much Sapphire Ventures, which is a pretty good fintech investor, software investor, I believe.

Yeah, so everyone else was a fintech or, or traditional or generalist investor. Sapphire, Norwest, Lightspeed. Um, Lightspeed's obviously done a lot of, a lot of crypto as well, but then call it the more like only crypto-native funds have been Us and Galaxy have been investors for a few rounds now. Um, and so Iconiq coming in in a big way in a $250 million round, we, I mean, maybe correct me if I'm wrong, I don't think we've seen a round like that with that kind of stamp of approval from that type of investor, that big of a, uh, of a capital push since '21. Like it's a, it's a real statement in my mind that we've seen since '21.

Yeah, I, Ribbit did maybe GA has done some in the space, but not for a while.

Yeah. Not since '21. They did Talos in '21.

Oh, Fireblocks.

Yeah. But again, Fireblocks, the last raise. I mean, great rounds and great business, but not since '21.

Yeah. No, you're right. I mean, look, it, it's, it's very impressive what they've done and I think, um, it's very interesting. I, I will tune onto the pod or help record that, or just be there to ask him questions. But yeah, very impressive. That is the highest signal in my opinion. You know, in spite of—

Yeah, well, and it tells you a lot about, I think generally what the perspective is for the demand for, you know, retail use of stablecoins, which people have been, I think, pretty dubious about. And a lot of people still are, but we're seeing the proof in the pudding. But to your point, part of the reason that they've grown as quickly as they have is not because, is not just because of this kind of retail demand. And the Artemis guys actually put out a really fulsome report on crypto cards today. Definitely, definitely check it out.

Okay.

But the, it's because they're also basically the only one who is able to do this full suite of things that the providers need.

Totally. And it obviously helps that Visa as a company, Kai, and every, like, has been very I guess a question for them is how much of it, like to your point that they weren't able to turn it on so much this year, like Visa I think made some key unlocks like that may have facilitated this in a very meaningful way. Like, and I think it's a very synergistic symbiotic relationship I would think that they have.

Yeah, 100%.

Yeah, yeah. And then the other piece, the Artemis guys, I remember that report that came out last year where you guys I think collaborated with them where the fastest growing sector of stablecoins was not B2C is B2B. Of course, Rain cards could be issued, like, could also serve a B2B, like, or most of their business is just B2B2C because you would cross— retail.

Yeah, so, so most of the volume in these things is actually B2B2C. So it's, um, it's an end customer. They're— they actually— Rain actually started as like a DAO tooling, like, business expense card management business, like a Ramp for DAOs in 2021. And that's actually how we—

I don't know about DAOs.

Yeah. And then DAOs don't really work. And Ramp actually, not Ramp, sorry, Reap, which is one of the competitors out of Asia, like that's kind of their core business. And you know, they're a sizable business as well.

But how many of the best companies in, certainly like not just in crypto, have like pivoted in a very meaningful way? Like poly market was always prediction market, but yeah, I don't know from your portfolio how many of them have had these kind of pivots.

Well, I was— there, there's probably one that we're, uh, gonna announce a large kind of Series B into relatively soon that has had, um, that had kind of a real pivot. Uh, but it was all— I, I actually, I would say this, they're, we've had a lot of companies pivot. All of the companies who have pivoted have pivoted and done well, have pivoted not that much. It's like a degree of change, right? So for like the Rain guys, it's okay, well we're gonna serve DAOs or businesses. Well now we're gonna do a B2B2C product and we still can do that other product, but the B2B2C product is the one that's like really exploding, right? And it's a, there's changes but it's not, it's very related, right? Otherwise. Mm-hmm. We've seen, there's a, you know, another business of ours that was more like, you know, doing stablecoin-related stuff that were, they, you know, before doing the stablecoin-related payments, they were doing more like, you know, interoperability for like DeFi, DeFi APIs. So it was a, a lot of the infrastructure they had already built could be used. And so, you know, that has worked for them. there's like a trading firm that kind of turned into like a DeFi protocol, right? And so, but they were already, you know, very deep in this thing and were building, kind of like this quantitative firm that they could then use a lot of that infrastructure for DeFi. So, so there's stuff like that, but you know, people do pivot and there are success stories, but I don't know if there's a single person in our portfolio who's had a wholesale pivot and, you know, been a big outcome.

Yeah. I can think of Slack as like one of the best pivots. Mine actually have a good one. PathDAO, I was an investor in that. I obviously, at least 10% of my venture book was like in gaming, like Axie and Illuvium and all this stuff. And I invested in guilds and PathDAO was one. And so they reached out to me and said, hey, listen, we were paying attention to this AI thing and agents and thing. We want to make a pivot. I didn't think much of it. And then that turned into Virtuales. And it's long forgotten. And, you know, of course you can argue, but, you know, the token at least has done very well. And I think it was one of the probably the hardest pivots I've seen. But I would say at that point, it's like the founders had a core technical competence that, you know, allowed them to— like at the end of the day, like that trading firm going into DeFi, well, like you're investing in a large part of it is like the founder skillset and like their financial guys, so like they're going to figure something out and just, I think, I think not uncommon for people to pivot. Maybe not full hard like pivot, but soft pivots to figure out a viable business model. How much of when you make a, because you guys traffic in seed, Series A, Series B, does the weight Like if you were to like have different criteria in your scorecard, like Chamath, like obviously everyone saw the memo that of Grok and he was like, is this a special person? And you know, that's sometimes you just kind of really simplify investment. Like, is this person have the, you know, the capacity to build something great? Yes or no? Like it could be distilled into that. There's a number of other things that factor into that, but like how much of in your investment committee process, like how much weight do you give to that? Versus like market supply dynamics, demand dynamics, like all the other stuff that you could, you know, you're looking at and thinking about in an investment?

It all matters. I, I think at the end of the day, the founders matter the most no matter what stage, right? But you know, maybe they matter less at B or C than they do at, you know, seed. That said, I mean, like, look, we, the two fastest growing things in the portfolio, uh, right now Um, at least, you know, most recently I've been Polymarket and Rain and, you know, these things, both of those companies, the founders built something that was ahead of its time. There, 2021 happens and, you know, the bear market happens right after in '22 and it seems existential to both of those companies.

Mm-hmm.

And the founders in both of those companies were steadfast and like, I know what I am building is the right thing. This is going to change the world. This is going to be a humongous business and the demand will come. But neither of those founders, I would say why they were, uh, they had belief when other people would've given up. They were smart about making slight changes here or there, being reactive to, you know, the demand side as well. Right. And so, um, I, I think a really underappreciated, you know, founder quality is just grit, right? Like, you know, can you go through a 2 or 3 year, you know, bear cycle where nobody seems to want your product or, you know, it's unclear and not only continue to build, but like be responsible and thoughtful and forward thinking enough to tweak things for where you think the space is going to be right on the other side.

Yeah.

Um, and so like, you know, those guys, all the hats off to them. The amount of resolve that both those guys had in '22 and in '23 and then, you know, in '24 before I think they both started really accelerating into the end of '24, like that takes an amount of, of grit that just is extraordinarily uncommon.

Yeah. Yeah, I would definitely echo that in my early interaction with Shane and some other founders. It has been, I think, particularly a very impressive cohort of builders in crypto because to your point, the demand was not necessarily there. Like, if you're going into AI right now and you want to copy X, like you have tangible demand proof points to apply and say, I'm just going to be better at building this type of product and I'm going to win business against something that's already very proven and you can underwrite that. And in crypto as an investor, but also as a builder, it hadn't been that case right now. Of course everyone wants to build a prediction market because the data is there and there's tangible demand that you can latch onto. But I think it requires a different set of, of, of founder that says the demand's not here yet. You just have to believe that it will be, and then I'm the right person to build this, and then I'm going to actually have enough money to see it through, and then I'm not going to spend it all. And then like, it's like layers and layers and layers. And that's what makes crypto venture has been very asymmetric if done well and very much power law, right? Those kind of rare outliers, 'cause you know, when it works and like hyper liquid, Hyperliquid was probably like an interesting example, and I know you guys were, were prodding there and like trying to get exposure there early. I made a number of prediction market investments because everyone was like underwriting the same thesis, right? It's like exchanges make a killing with prediction markets. There should be an opportunity to do this on-chain. Someone's going to figure this out. So like almost like take a bucket approach and invest part of your book into credible builders that are going to figure this out. I would say most of the bridge— we talked about this, I think last year, but like, why didn't— why did Hyperliga was successful when others weren't? And by the way, there's like many, many others that weren't. I think there's like team-specific reasons attached to that. And then there's also like infrastructure reasons behind that, regulatory considerations around that. But I would say like, Hyperlink could launch at a different time. Like obviously Jeff and team are phenomenal. Talk about a small team, by the way. But more so—

Did you read the, there was like a Forbes article about him or—

Was it?

I think it was Forbes or was Fortune that was just like, you know, a little bit about him. It was really good. Read it. Look it up.

I'll read it. But yeah, of course, like the infrastructure is more further advanced that would allow for just more performant. Protocol on chain. Not the only reason why it exists, they proliferated, but just interesting, right? All right, well, enough of the theoretical. What else is going on? I mean, obviously, before this pod, we were just talking about maybe to round out this segment of like, how's the year starting off? I hate to think in calendar years, but whatever, we have to do it for the sake of this. But are you, are you guys actively investing and are you guys like, you know, you have the dry powder, like, are you seeing good teams? What categories are popping off? Like, how are you thinking about deploying this year? Like, just what's going on in committee?

Yeah, our general perspective. So, I mean, we're, we're 2 investment committees into the year, and those 2 investment committees, we haven't had a new deal come up yet. I mean, that's also not surprising that, you know, there's not typically a lot of, you know, deals that happen like right after Christmas. We did, um, we did fund something the first week of January that we had been working on for a little bit that will get, um, announced, you know, next few weeks probably. And, um, the Rain, this version of Rain, we had funded a little bit before, um, uh, Christmas. Um, But when I look at, you know, we, we always go through the pipeline every week as well around investment committee. I look at the pipeline and it's not short there, but it's not the longest I've ever seen it either. It is still very heavy DeFi, very heavy payments, very heavy, you know, stablecoins. There's, I, I think we're seeing, a lot of things around still the, you know, the trading economy, the degeneracy economy, you know, iGaming, um, you know, the, uh, things like that, wallets, um, and there's some AI stuff, but there's not a lot that I would say has been, you know, maybe completely like net new categories that we've been, you know, I, I think We haven't seen anything that has seemed like really outside or different yet than, you know, what was topical last year. And so, you know, I think right now our expectation, and this can change quickly, is that this year is probably a lot more of the same. DeFi, CeFi, infrastructure, stablecoins, payments, you know, wallets, um, you know, fintech type stuff. And we probably expect that we'll— that there'll be— we'll be doing less investing this year than last year. I'm putting like our check in the rain into last year because we funded it before the, the holiday. But yeah, um, we did actually probably a pretty decent— there's all this talk about like, oh, ventures slowed down last year. And we— I mean, one, the data doesn't show that, but two, like We put a lot of money to work last year. Now we put last year—

you got one of the most active—

go ahead.

Were you guys one of the most active VCs?

I, I think we were probably top 5. I think us and Paradigm were probably the most active from a dollar out perspective, if you don't include DApps and like these like liquid token— yeah, yeah, you know, like Pantera went out and said, hey, we made our biggest investment ever, bought a bunch of TON in the open market, stuff like that.

No, no, No, no, no, excluding DATS. We don't talk about DATS anymore in this pod.

That's what I said. No, so I think, I think, I think it was, I think it was probably us and Paradigm that were the most active from a dollar out perspective, but I don't, I don't have that data.

So yeah, yeah, yeah, for sure. Um, speaking of funds, uh, A16Z raised $15 billion. I think they, uh, surprisingly, I think that encompassed, what is it? 15, 17%, 18% of all venture dollars raised.

18% of all venture. Yeah.

Wild for one firm to take that. There's all the screenshots going around of like their DPI and their fund performance across vintages. And some funds have done quite well and I think their LPs are generally happy. But then there's always that person that says, wait a minute, you could have just bought the S&P and outperformed. Will be interesting. What is, I don't know if you want to comment on that. What was interesting in their letter was I think a couple of things that they kind of, they have a list of things that they want to invest behind and they specifically obviously called out AI and crypto, which I've always respected them for being one of the first to like a traditional VC stepping in and through and through over the years they've they've kind of like held a specific vehicle called A16Z Crypto and the Crypto School. And, you know, honestly, like a ton of respect for that 'cause it was obviously through a very different regulatory environment. And yeah, this is very interesting that they put it a specific call out to AI and crypto and yeah, you know, it's, it bodes well obviously for a number of reasons. They do a lot of regulatory, you know, work, which has, I think you guys do too, but Yeah, they're the most active, like them and Coinbase are the most active in DC of anybody in the space.

So yeah, you know, what I thought was interesting about that, so it was great that they called out crypto. What I thought was interesting about that is they didn't raise a new crypto fund. So they're, uh, yeah, they didn't raise a new crypto fund yet. Um, I mean, the last fund was $4 billion if I'm remembering, maybe $4.5 billion, right? And they raised that in '21. So it's not surprising that they have money left in that fund because like that is just way too much money to put to work unless you're doing—

how much of those were just, were they, they bought like a bunch of like Eigen and a few of their like venture positions. They like doubled down, I think.

Yeah. And they, they, but the, the liquid stuff they can, uh, they can recycle, right? I don't exactly know how their funds are, are structured on the 16Z side, but they're, they're obviously doing liquid, but the team is not big. I think their investment team is 6 people, right? And so with, with, with 6 people, one of those being Chris, right? Who I'm, I'm sure Chris is not like hunting for new deals. You know, they're, uh, gonna, they're putting to work, you know, over, you know, $4 billion. So it's not surprising that they have more money to, to put to work. And, you know, their first crypto fund was, you know, incredible in terms of, um, you know, from an investment returns perspective. But I imagine the, the fourth fund, although they own 10% of SUI, so you know, that, you know, ran up to $40 billion at some point. But I imagine that that $4 billion fund has been harder to get the same returns just because of, you know, that's how the correlation between size and returns. But I thought it was funny that they talked about it. They still very much believe in it, but they didn't raise a new fund. And then they had all of these other new funds that were, you know, they had like a $2 billion apps fund and like You know, all these other funds that didn't talk about those.

Biotech is a big one. Like Martin Casado, I think, runs that. Do you, well, I guess we could have theories around that, but it may be true that folks like Alex Rampel, like the fintech team is going to now step in. The growth team is not going to step in to do deals like Ramp, like, sorry, not Ramp, but Rain. Theoretically, like the ACC Growth Fund could invest in that. And if Iconiq is doing that, then certainly they can do it out of the growth fund. And you know, they've done fintech investments. And so, you know, it could come out of that. So maybe it could be true that they just have appreciated that the investible universe is skewed more closely to what their fintech team would be looking at. So, hey, let's not raise a dedicated team. Or maybe they just want to fold the a16z crypto team within the broader mandate.

I think they just have, I just think they still have a lot of money. Yeah. And they're going to raise a new fund eventually, but they just have a lot of money still.

I would, I personally, I would never, commingle them. Like crypto's just a very different beast from a capital account statement reporting LPs. Uh, so, but yeah, interesting.

Yeah. But no, I, I, I also agree with you that one of the things that we've seen happening in, in crypto ventures that a lot of the stuff that is working does look like fintech again.

Yeah.

Right. And so it is much easier for theoretically like traditional fintech investors to invest, right? You look at, you know, what are the biggest rounds of the year? I mean, I guess we— I talked about Reigns, $250 million, and I said what has happened, uh, that looks like that's a '21. Well, obviously the thing I, uh, stupidly missed is the other thing on our portfolio, and, and, uh, is which is Polymarket with the $2 billion ICE round, right? Like, that is obviously incredible. And then, you know, there's Kalshi raised, you know, a billion dollars, right, as well. These rounds are getting done by like non-technical investors mostly.

Kalshi, Paradigm, and A16Z, or who did Kalshi?

Yeah, Paradigm led the most recent, and then they were part of the round before that. And Dreesen's in there, Sequoia's in there. I think the only other big crypto investor in Kalshi other than Paradigm is Multicoin. Multicoin was in the $5 billion round, I think. Yeah. Um, they've been at it for a while, I think. Uh, maybe. I don't know. I don't know. So. Yeah, but they, um, but obviously those are, those are the other two things that have had these big rounds now. But you're seeing like the things that are growing really quickly are getting interest from the traditional investors again. And so that does tell you, right, or, or should, you know, you should be wondering, is just being very crypto-native, um, still going to get the types of returns? Is it a place where you can still, uh, Is there enough things to do? Is there enough, you know, tokens that are going to do well? Do you have to broaden your aperture? Do you have to broaden the, you know, things you're investing in and, and are doing well? Um, and then if you do that, are you actually able to compete or is it adverse selection, right? Because I, I think somebody else, I've seen this where, uh, a lot of people have been joking like, oh, every crypto fund's a fintech fund now, which is kind of true, uh, in many ways, but it's always been true in some sense. Um, but the question is, is are you gonna get adverse selected? Against or not, right? Like, are you able to compete against Lightspeed or, you know, somebody like that? And I do think we're going to see more and more traditional generalist or specialist investors come into the space, uh, in the next year. We're going to see more of these big growth rounds get done in these like core pillars that are working. And if, if that happens, uh, yeah, this was a super interesting one.

And I know Mercedes from, uh, from the Lightspeed days I wanna, I do think when you're saying that, I saw this, I now I'm in the habit of bookmarking stuff because I can reference them during this pod. Uh, Yano typically does this, but now, you know, he's rugged us. Nonetheless, this is an interesting chart I want you to take on, which says for anyone listening, there's a tracker over 2015 to today, over the last 10 years, the average time it's been taken to raise VC funds. I don't know if they're including crypto funds, but That has been—

All VC. It's everyone who reports on PitchBook. Yeah.

Okay. Got it. All. So it includes all VC and that has been grow— going steadily up across average, fastest quartile, median, slowest quartile. The difference between the fastest quartile. So the fastest quartile is now raising, takes 8 months to raise a fund. And the slowest quartile takes 2 years. The average and median are kind of the same. It's kind of 18 months, so, you know, year and a half or so. Um, how do you— is this true?

Well, yeah, I mean, and it's— I think it's especially exaggerated within the crypto funds because like, if we were to have a line of crypto funds, like, how would it track? I think that— I mean, it would definitely track. It'd probably be the same or similar, but, uh, there's just less of us. But it might be— it might be worse, to be honest. I, I don't know if anybody in the space of any real size is doing 8 months at this point. Um, but you know, it's, it's taking everybody longer than that. That said, um, I think one of the GPs— so, so of course Andreessen goes and raises $15 billion, and every single GP at Andreessen is on a podcast, uh, in the next like 2 days. And so one of those podcasts I was listening to with, I think, the GP of the guy who runs the Apps Fund, um, is a 20VC podcast. And he was saying like, listen, like we're kind of having this like death of the middle, right? And I think we've talked about this before in the past, but like you either have to be a big platform or you have to be a niche, like, you know, general, a niche like specialist who has like really good deal flow on the thing that you do really well. And the middles get dying. And that's a lot of what you're seeing here. That's happening in crypto as well. I think like the middle generalist crypto, um, is probably going to die out. You either need to get big and scale and platform, or you need to be smaller and be a specialist. And in crypto, it's really exaggerated because like, if you think about the LP landscape, especially for the people who are raising institutional capital, LPs are, are the way they're deciding allocations is they're saying, okay, well I need some PE bucket and within that PE bucket I need a VC bucket and within that VC bucket I need probably generalist VC. I definitely need AI. And then, you know, that kind of, kind of it. And so they have to have somebody on the team who's like, oh, I also need crypto. And so if 20% of your portfolio is private equity, 8% of that is VC, right? And then, you know, what percent of that is in— or 10% of that's VC, 5% of that is, you know, generalist, 3%, 4% is AI. How much does that leave for crypto? Yeah, right. Um, it's tough. And so there's just this like dearth or it's just like much harder. There's a much fewer LPs who want to put money into, into crypto funds. And so you, and the ones who want to have size, they want to either go with the platforms they know that they've already been invested in or that have name brand like entries in. Yeah.

I'd heard, uh, I'd heard A16Z has, it's, it's been interesting from my perspective. Like obviously when I was fundraising for like, when I was at ParaFi, even at Sageview, I got to look at how difficult it was. Even for super established tenured folks, uh, Ned and Scott, you know, first associates at KKR left, raised a fund, second, it all in many ways through this process, I've talked to a lot of fund managers and they've said, hey, it's not the first fund that's hard. 'Cause the first fund you typically raise from friends and family, people that know you, you're coming off of another fund, you know, it's either the second or the third fund. And a lot of managers that I've talked to, like emerging PE managers that started off doing SPVs, then raised $100 million fund, now they're at like fund 7, $8 billion. Um, they're like, it was the third or the fifth or the third or the fourth one that was the hardest because you didn't have DPI. And you know, DPI isn't a big issue now in private equity. And, um, but yeah, it's, I would almost want someone to do a chart that shows, we talk about the four-year cycle here. There's always a running joke, of course, in venture, which is people want to give you money when you shouldn't be investing. They should, and they don't want to give you money when you should be investing. So It's an interesting time because for instance, say that Bitcoin hit an all-time high last year. Naturally easier to pick up the phone and cold call or get introductions. People want to talk to you, right? Hey, stablecoins, Rob, you're talking about stablecoins. Yeah.

Okay.

I want to talk to you. You go in there and it still takes a year maybe to convince a large university endowment or foundation or a family office. Family offices are faster, right? But still, some of the larger sophisticated ones might still take time. They want to get to know you. So if it is true that it takes like at least 12, 18 months, forget about the 4-year cycle. It's like pick a time where the market's starting to rally in a meaningful way, maybe not the all-time high, and then that's when you're going to raise the fund. And then it's like, okay, when is the dry powder going to hit? So I almost would want to see a chart that says like, when is the— one of the funds like raising one of the bigger funds like raising? And then how does that track like over the next like 12 or 24 months? Like when do we peak and where's the bear market? I wonder if that's a better correlation than other stuff that we kind of see point to and kind of point to in crypto, like 4-year cycle and stuff like that.

Yeah, I mean, that's almost certainly true, right? Because like the interesting thing about that chart that Mercedes put out there was that it, I mean, she says this, but it's, the amount to— or the time to close is during, um, it's from when the Form D is filed. So that's when you do first close, you have to file this regulatory Form D, and it says, hey, I've done first close, this is how much I'm raising, etc. And then you eventually file, uh, an amended, uh, one in an ADV in the future when you show that you're, you know, kind of final, you've had your final close of the fund, right? And so what you're seeing there is that like when it says It takes 18 months to close a fund that actually is 18 months between first close and final close. Oh wow. Which means that you were raising some period of time before, before that.

Which, which can be, by the way, another 18 months or more.

'Cause it's, it's usually not 18 months to first close. It's probably like 6 maybe. So say 3 to 6 to first close typically.

Um, 3 to 6 from when you kickstart fundraising.

Uh, yeah, probably 3 to 6 when you first start running for first close because you'd first close with like, Typically, like, call it anywhere from 30 to 50%, but you only first close with friendlies. You first close with, with insiders, right? Yeah.

Typically. Yeah. So like, I, for instance, I always think first close should be at least 30 to 40%, 40% of the capital that you, you're targeted.

People first close a lot with like 25, 30%, especially if they're near the end of their fund life on the other one. Well, we should talk about the previous end of, January then.

Okay. But okay, that, that would make more sense because I've, I guess you want to close a deal, you want to show momentum, you want to have some dry powder. And then, and then, yeah. But I, I hearing you say that, I was going to say I would've thought that the second close is usually faster than the first close, but I, I, I see your point. I actually don't think that would be true.

Yeah. What, what, what typically happens and what we're seeing happen in the space is that like, You know, most people, they— so you go, if you're raising the same size of fund, um, it's usually much easier than if you're trying to raise a bigger fund. Because if you're a good manager, 80 to 90% of your LP should re-up in the next fund. It's always easier to get a re-up than it is to get a new investment, right?

Totally.

And a lot of these institutional allocators, the way they work is that once they've gotten the manager approved, you have to suck to like not get kind of reallocated over time. But it's that first check that's really hard. And so you get, if 80 to 90% of your LPs are going to, to re-up, you get, you know, kind of some of the largest ones, the anchors to re-up, you get them closed, you start to, you continue investing on that new fund, you show some momentum. And then, you know, you get a little bit later into the fund and then people say, oh, they, they, they like that, the new investors, because they can look now at, oh, you've already deployed a fifth or a fourth of what you expect this fund size to be, and I can now actually underwrite what you've already put in the portfolio, right? And I can see if I like what you've done and if what you've done is showing momentum. Um, and so—

go ahead, go ahead, go ahead.

No, but so it's— it becomes, like, um, really interesting that, like, you're seeing that, like, it's taking people sometimes 2 years to raise these funds, which— what it's essentially telling you is that because of the lower levels of DPI, the LPs are demanding that they actually underwrite what's already in the fund a lot of the time versus like giving you money ahead of time. Yeah.

I was an— I'm an investor in a number of funds. One of them is raising another fund, and I— two of them, two of them actually wanted to do their first close and I think both of them took profit in some of their early bets in the prior fund and to show DPI, which look is great. I'm not complaining. I do wonder, is that a, was that the right call? Do you think they sold too early? Well, you know, it's always, of course, look, everyone, this is a common question. Like Peter Thiel goes out saying, look, I sold Facebook too early, but you, you know, you have to do share responsibility to, to return money to your investors. And unfortunately, that is just the nature of money management. And it's hard to look at in a vacuum, like you sold Facebook too early. A, it was a great win, no one's complaining. And then you could, LPs can recycle that money elsewhere. Then B, there's like countless other examples where you didn't sell at all and it went, you know, you could have profited, right? And so I always think it's like unfair characterizations of like cherry picking. But it, it, I, it did leave me wondering, like, I, I hear you. DPI has become a way, way bigger component now 'cause you know, there's not a lot of DPI. Some of the A16z team funds coincidentally have some interesting DPI even though they didn't outperform the market. So you could say again, why are people giving them money if they're not outperforming the S&P? Is because A, allocators don't think like that. They need to invest in certain buckets to do portfolio construction. So they're, they're going to have a venture bucket. They're going to invest in names that they're not going to get fired for and approve managers. And as long as they're showing some DPI and not sucking, they're going to continue drew up, right? It's like, yeah, if you're like a pension, A16C, you got to like— it's almost like the reverse now. They're in a position where if you're a big allocator and you didn't invest in the A16C funds, like, wait, why didn't you have access to them? You know what I mean? It's like 15% of that.

But there's also like, you know, there's a lot of hurtful— if you're an LP, you're never going to get fired for, you know, investing in Andreessen, even if the Andreessen fund is not the best performing fund, right?

Right. Well, if you're not an LP, if you're the the pension manager— again, it's very different. Like, if you get raised money from endowments where most of the capital— if I forget the MVCA data, but like most of the— if you think about the $15 billion, if you were to slice up how much of that is pension funds and endowments where the decision maker is not the principal, it's an agent, most of the $15 billion came from I, I'm, I'm, I'm, I'm hypo— I will check with the data, but I, I would say at least 60% of the money is like pension funds and endowments at that scale.

I mean, it's probably not even— I would say it's pensions primarily, and then endowments are, you know, presidential. Yeah.

Yeah. Which at that point, it's a very different decision, and what drives the decision to allocate is very different than a family office, even though obviously I read like JP Morgan's report a lot of family offices are increasing their allocation to alternatives and illiquids. And a lot of that of course is private equity and ventures. So the decision driving a decision of family office, I think is more, is very different than like a pension fund, right?

Yeah. That's right. Yeah.

Interesting. Um, well, I will more dry powder, I guess this year. Um, hopefully.

Well, listen, in crypto we've only seen, you know, I think we'll see another announcement or two, but we've only seen announcements of new funds from Paradigm announced an $850 million fund, I don't know, a year, year and a half ago. And we've seen some smaller funds get announced. I think Archetype announced a new fund, as I understand it, like a $100 million fund or so. But we haven't seen any of the other large funds. Uh, Hashkey announced a fund. Yeah, that's right, $50 million fund. What? I thought they just announced that they raised money for their IPO, not a new fund.

I don't, uh, no, I think, because they're— I read that to congratulate them. I'll check really quickly.

Yeah, but, um, but we haven't seen anyone else announce, call it, large new funds. And that, you know, does, does trickle down to the, you know, VC landscape, right? If you haven't You know, if the, if the VCs aren't raising big new funds, or if they're raising smaller funds, there's less money to be invested in VC. And so I think it's— I think we're going to continue to see this sort of existential kind of hollowing out of the middle in, in crypto venture, uh, and we're going to see more of the things that work get, you know, gobbled up by, you know, the generalist investors. And where the crypto VCs are going to have to figure out how to adapt to that.

So, yeah. So Hashi raised Fund, uh, 9, no, Fund 4. Uh, sorry, Fund 4, $250 million in commitments. The rest of them focus on blockchain infrastructure, mass adoption use cases, and emerging markets. That was announced December 23rd of last year. So $250, that's fairly sizable, I would say.

Yeah. All right, anything else?

We're on the—

Nikita Beer nuking InfoFi.

Yeah, agree, would end it. We're gonna have to end with content of the week because that's not a good way to end the podcast, sir. Um, there's, there's a new term, word of the day, by the way, or word of the year, I would say, because people now dub me as a pessimist or whatever. I'm just an optimist, but I'm also a realist. There was a word of the day as a, as an interlude here. Word of the day is What the hell is this? Pronoia, which is the opposite of paranoia. And I just learned, it says most people, successful people I know, all, almost, almost all of them have an irrational belief that everything will work out. Something you said earlier. And I just recently learned that the word for it is pronoia. So less paranoia, less FUD, more pronoia.

Pronoia 2026. That's the word of the year. Oh yeah.

The banner year for Noya.

Okay.

But anyway, so—

That's another week.

Why don't you talk about it? I mean, our engagement sucks, probably 'cause I'm tweeting like shit that no one wants to hear and I'm a perma bear now. So I get why my engagement's nuking, but what's happening on crypto Twitter land, Rob?

Yeah, I mean, there's been all this talk about Nikita Beer trying to, he's been like de-emphasizing like niche groups, I guess. Um, but then it seems like he kind of backtracked on that. People were getting, you know, some engagement again. I think the reality is, is like, if you're— they've obviously been deemphasizing the following tab and for the For You tab because they want you to kind of discover new things. And it's caused this, uh, kind of— and the same thing we talk about the funds is like hollowing out of the middle where like you either go viral and you go really viral, or you kind of stay within like a small band and Um, and so if you have, you know, 150,000 followers, which I think is how many you have, right? Like if you don't, uh, go and get something that's picked up really quickly on the For You side, then you're just kind of getting no engagement whatsoever. Um, but then the interesting thing they did today is Nikita Beer came out and he was basically like straight up, um, saying that they're now changing the way that the X API works. And so, you know, they, they're basically not allowing apps that reward users for posting on X or like apps that, you know, use the, um, that, that use like the X API to, um, you know, maybe like bet on, bet on or something like anything that like might have some sort of like financial activity around, um, just like who's posting and what they're posting. They blamed it on like there's too many bots and like, you know, etc. Um, I, I think they're trying to— I'm sure that's part of it, but I think they're also just trying to, um, maybe in some way kind of up the level of, um, quality, right, over quantity on X, because the quality has been pretty bad recently. But I don't, I don't know if this is it.

Um, yeah, it feels like that. I don't know if it's the old adage of they're taking a chainsaw where they should be using a, hey, what is it, a tweezer or something like that to fix a problem. They have a bot problem. We all kind of have seen it in the replies.

It's gotten way worse since.

It's gotten way worse. Why? Because, you know, they're not paying out. And so it's sort of like, blow me a hole, crypto has this problem. Civil resistance, you know, airdrop farming, also relevant for, you know, X. There's a, so yeah, it's, it's interesting. I, I've certainly noticed my engagement cliff off. I think they've deprioritized that type of content and I think a lot of folks in crypto are upset. I don't know. I think it's important to listen to your, I don't know, obviously there's, we seem to think we're in a bubble and crypto Twitter is the most important like aspect. I was thinking about like who actually funded Elon's deal. CC is quite a I think he put like a billion dollars in the deal or something, which of course I don't think he has any, any say in the matter. But anyways, there's a Polymarket, which we were showing earlier, that was a prediction market on like, will Nikita Beer remain as head of product at X by, you know, at the end of the quarter, March 31st, fairly low liquidity. There's what? Can't see. Shane, if you're listening, man, you gotta put it on the top for us. You're making it hard. But it hasn't moved. I mean, it just launched. It kind of went down quite a bit. Probably, I don't pay much attention.

I don't know why people thought he was going to be out. It didn't really make any sense to me in the first place. This felt very much like crypto people like misreading what was happening.

So yeah, yeah, yeah. Um, but yeah, I think it, it's interesting. Um, that had an effect on Kalshee, right? Sorry, not Kalshee.

Uh, Kaido had an effect on Kaido, obviously with the apps. Well, they announced a new business today. Um, there's another one called Noise.xyz, which is sort of an attention market. Thing, which Paradigm just announced an investment into that. I think my guess is they're gonna be affected, um, as well. Um, so there's a number of businesses that are gonna be affected, but I, I think we'll have to see how this plays out.

So, yeah, totally. Um, all right, man. Content of the week.

Uh, we just got new seasons of Industry, one of the best shows on TV.

Okay.

It's a, You gotta— we have to be watching the industry. And, um, there's also another HBO show, uh, which I really like, uh, which is called, um, uh, oh gosh, I'm blanking on the— or The Pit, sorry. It's like the, um, it's sort of a— it was one of the main actors, um, from ER from the '90s, uh, oh, and it's kind of a, you know, They follow you around like 10 hours in an ER and some, you know, crazy stuff happens that's like super unrealistic, but it's kind of a fun, uh, I guess like, you know, guilty pleasure. So called The Pit, season 2, both HBO shows.

I envy you, man. I don't think I've turned on my TV in the last year. I know I did for a few shows, but this is my best friend, pocket Kindle. Probably had this for 10 years. Favorite color is blue, ladies and gentlemen.

That's great. That's old school and I love that.

I've been reading a ton over the, over the holidays. So I just started and I really liked The Fish That Ate the Whale: America's Banana King about this guy who like saw an opportunity in the banana trade and pretty fascinating how bananas are like amazing cash cows if done well. Like they, they grow everywhere. They're super, like the yield is super high. You can, like, they're not, they're berries technically, not fruits, but like they basically grow in tropical climates and they can, they grow super fast to the point that you can almost hear them at night grow, which is like daunting. But amazing story about someone that saw an opportunity, an arbitrage opportunity in market. 'Cause a lot of times, to give you an example, he back in, I forget, like early 19— century or like early 20th century, they, he would be on the dock where the banana, like the ships would come in and they unload the bananas and they would kind of inspect very quickly if they're good or not. And they would discard a bunch that were consumable, but they would just go ripe very quickly. 'Cause soon as, soon as it has a dimple or whatever, like the brown spot, it, it, you have kind of 7 days. And he was like, okay, that was interesting. And he basically built a massive business based on that because he said, there's too much waste. And he said, I can actually sell that. So he, with $150, goes to United Fruit, which is a massive player in the space, says, I can make money off of that. And if you sell me for pennies on the dollar, and then he was like, all I need to do is I have 7 days to sell this shit. So he built an empire out of supply chain, like just basically logistics. And I thought that'd be pretty, I always find fascinating stories of people that like can build a lot of value in commodity, seemingly commodity industries. And in that case, he just built a supply chain that no one else had. So I'm really enjoying that book and I highly recommend it.

Cool. All right, maybe next week we'll get the whole group, you, me, and Jason Yanowitz.

Yeah, it's probably going to take me to go to New York to do this at this point, but I'll be in New York, I think either end of month or early Feb. But yeah, Hopefully.

Yeah. We gotta get an in-person pod. The in-person pod hits different. It, it really, maybe the end of the month.

It really does. We should definitely, I'll check the calendar. I, we're opening an office in New York, not far from yours. Finally, finally, we're just kind of like getting everything set up. Uh, so I'm really excited. I'll be spending way more time in New York. Um, less than 183 days, but I will be in New York.

Hear the tax authorities.

It's like the Peter Thiel filing. Like we have an office in Miami.

You gotta get the app on your phone. That like tracks you, right?

Oh, I saw. Do you have that?

Right.

You posted it.

Well, so I don't have the app because like I'm, I'm in, I'm in New York. I pay taxes in New York. But, uh, a lot of the people who do like, you know, back and forth to Florida, the app will like track the, the, you know, geolocation on your phone. And then it'll say like where you were on any given days. Uh, and then you can actually, uh, give, it's, it's unable to be edited and you can actually give that to the tax authorities. Or you can edit it, but it shows when you edited it. And then you have to, you can go and say, hey, this is why I edited it because XYZ reason.

So it'd be great if we can have a zero-knowledge proof on that. So you don't have to share exactly your location, but no problem. Ledger gets hacked or Coinbase gets hacked and we still have your information anyway. So it's no problem. But, or this application gets hacked and they have your entire location history.

Privacy is a meme. The consumers just do not care.

All right, ladies and gentlemen, we'll come up with a better meme next time. What is it? Proanoia. Remember that word. We're optimists in this podcast, ladies and gentlemen. No more paranoia. No more FUD. We're starting off the year optimistic. So anyways, great to be here, Rob. Thanks everyone for listening. We'll tune in next week. Thanks, Elti.

All right, take care.