Coinbase’s Listing Frenzy, Massive ETF Flows, and Bull Market Phases | Roundup

If you do it correctly, the market then says, wait a minute, you took a company that had 20% EBITDA margin and within a year you took it to 40%. We've never seen that. It's like the Houdini effect without doing financial engineering, which doesn't work anymore in a normalized rate environment. And if you do that, then people really finally start getting it of like, yeah, Bitcoin's super important and whatnot, but there's this other component of crypto where people haven't really truly appreciated. And that's the insight, that's the secret. And I think if done correctly, like, that's a case study. And I think once you do that very well for one or two, then it's off to the races. Then people are like, oh, okay, so this is what crypto is all about.

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Yeah, it's all— it's only Thursday, I guess, but yeah, uh, it's exciting. See you on Yahoo Finance, you're going on Fox, you're doing the rounds, you're doing the circles. People want to— people want to hear about crypto now.

I'm going— so I'm going on Fox Business in like an hour and a half. I'm talking about the Bitcoin strategic reserve and the possibility of a $500,000 Bitcoin. Oh my God, the bull market is back.

I love how we go from like forget about 100 or 200, straight, straight, straight shot into 500. Like we're just gonna catapult there.

Picture of, uh, No Regrets. He went on Bloomberg and he's talking about 500K Bitcoin and he's looking, you know, he always wears like a jacket or like a button-down. He was looking like freaking Steve Jobs in these like new rimmed glasses and a turtleneck. And I was like, oh, the bull market is so here.

Definitely bad people. It's how quickly how markets— people regain their confidence.

And yeah, give me a, give me a quick State of the Union on InversionCap, just because I know you're in New York, I know you're fundraising. I saw you guys launched a Twitter account. I saw you got— oh my God, looking dapper, looking dapper. Uh, you guys got office space. Um, so yeah, hi, give me this.

We're an undisclosed location in the We're in an undisclosed location in, uh, Lower Manhattan. Um, very good. Uh, I haven't really started fundraising, um, but, uh, I've identified— yeah, it's really exciting. Look, most of my energy is spent on identifying targets. Uh, I've pulled together a really solid team, operating team. Um, I don't know how much I can actually talk about this, but from an execution standpoint, uh, I'm super excited. The more I look under the hood of a lot of these businesses, it's just incredible how, uh, the, the type of value release and transformation that can be had. And that's pretty amazing. Obviously, the opportunity and the challenge is staying focused, right? Because there are so many businesses you can apply this to, but you're working within certain constraints, resource constraints, time, number one, two, capital. But yeah, it's really encouraging. Again, as I said, I think that the reason why I'm so excited about this is that I want this to be a case study. And I was watching like Barbarians at the Gate over the weekend. It's like a fantastic book and movie. You actually find it for free on YouTube because I could only get the DVD version. It's basically a story about one of the earliest buyouts, one of the largest buyouts in the 1980s by KKR of RGR Nabisco. I think I get so excited because I think we're going to— this is it, I think, for private equity as a new chapter where I want to be the first and I want to be the best at transforming businesses with crypto. And I think you've done correctly. This would be a case study of the version and the success here is you take a business, you transform it, you do all the AI, all the other stuff. That's level stakes. But if you do it correctly, the market then says, wait a minute, you took a company that had 20% EBITDA margin and within a year you took it to 40%. We've never seen that. It's like the Houdini effect. Without doing financial engineering, which doesn't work anymore in a normalized rate environment. And if you do that, then people really finally start getting it of like, yeah, Bitcoin is super important and whatnot, but there's this other component of crypto where people haven't really truly appreciated. And that's the insight, that's the secret. And I think if done correctly, that's a case study. And I think once you do that very well for one or two, then it's off to the race. Then people are like, Oh, okay, so this is what crypto is all about. I'm like, yes, we've been telling you for 10 years, but you have to do it. You have to show it. And there's no better way of showing it than just doing it with a very substantial business people know. So I'm excited. That's where I'm spending most of my energy. I have 2 sectors and 3 companies that I'm doing a lot of work under the hood. So, yeah, nice. Exciting.

How are the fundraising?

Back to my private equity days. Yeah, I haven't really started, but I can't talk about that. But a lot of inbound interest, I guess. I'm, I'm really just prioritizing really strategic people at this point. Um, nice. And so yeah, it's good.

Nice. Um, what do the really big— when I know you're not fundraising, but what do the really big TradFi folks think of this?

I haven't, um, well, they appreciate private equity. Um, they appreciate that this is not financial engineering, and this is a way for them to express a view on crypto in a way they understand.

Yeah, right.

Because historically, if you're like a crypto fund, you're pitching to them, hey, these are the— you have to get them over the hump with certain ideas. Like, first, the— is it a hedge fund? These, like, liquid venture asset class is tricky for them. And second, it's like the token component. But this is just like, I'm not underwriting a token. I'm not underwriting investing in that. It's purely like, I'm using crypto infrastructure, and it's almost a bit like, this is blockchain, not crypto crowd. But of course, in my conversations with them, it has— and we all transitioned to talking about this in this pod— the tune has really changed after the election. And all this to say, people have been studying this asset class for a decade. They've been either pitched or have seen it on TV. And they're at a point where they were just on the sidelines waiting for clarity. I knew that in my days of ParaFi. I knew that over the last couple of years, you just get a sense that so many people are on the sidelines. You just saw BlackRock come out and support a bunch of these assets that were deemed securities by the SEC. You have Brian Armstrong using different language as it relates to the Polymarket chain being raided by the FBI. That, that's a very big change in tune. And so, yeah, let's talk about the—

let's talk about the weekend, huh? Yeah, let's talk about the week.

Yeah, but anyways, uh, super exciting. Yeah, there's so much going on, but it's going well. Yeah, I'm busy. I'm, you know, if I haven't responded to all your messages and everything, it's because I'm inundated. I'm just really focused on, on, on, on the acquisitions.

Good. Well, I'm excited for Barbarians at the Gate. I'm a friendly—

you know, on this point, by the way, I just want to make a comment. Private equity has had a bad rep of going in there, slashing the business, stripping it, levering it up, and like firing a bunch of people. What I get so excited about crypto is that the transformations that you make are removing what I call systemic friction. So when you lower payment processing from 5% to less than 1%, And when you eliminate chargebacks, when you fix settlement times to T+20 down to zero, you have all these working capital improvements. That's like a material transformation of the business. None of that requires you firing your workforce. You know what I mean? And for me, that's also really important, which is doing good and these transformations no one's ever done before. And so I actually get really excited about that because it allows you to actually expand it into markets, employ more people. And so I think that's, um, you know, ultimately I think I'm a believer you have to do good, and crypto is that type of technology that allows you to be more efficient, serve new markets. It doesn't involve, you know, slashing and burning, kind of barbarians at the gate type of strategy. But yeah, I love that. This is Barbarians at the Gate 2.0.

Yeah, Santi's at the gate, baby. All right, so let's, uh, do— what a freaking week. Um, Marketing team told me I have to give a plug. We have New York is back. I did see you're getting an office in New York. Kane's getting an office in New York. Irene is getting a freaking—

I already have an office. I'm in the office right now.

This is your office? Nice. Nice.

I mean, like, well, this is part of the office.

Oh, it's brick. Oh, how New York.

Historic. It's like one of the most historic buildings in New York.

All right. Well, anyways, reminder to folks, we are hosting two events in New York next year. DAS is in March. Permissionless is in June. We just announced, actually, this is kind of wild. Muhammad Al-Arian, he was the CEO of PIMCO during the financial crisis. He is now chief, I think, economic advisor of Allianz, which owns PIMCO. They're the largest insurance company in Germany. Yeah. And he is, I mean, he's speaking at DAS. So to see someone like that come to a crypto event is pretty wild. So there's that. And then also Telegram is booming. We have like 600 people. Go join that. Okay, dude, what a frickin week. Bitcoin passed silver. Alliance Bernstein is emailing their clients to get into crypto. We will keep it as simple as that. Get into crypto. ETFs had, I mean, some of the— one of the craziest weeks for ETFs in the history of ETFs. DeFi folks like Blur were talking about turning on their product, their fee switch. BlackRock expanded Biddle to a bunch of different chains. Coinbase launched bank accounts and meme coins in the same week. Um, ETH did their ETH 3.0 roadmap. Uh, there was some M&A.

What is it, like a 2050 roadmap or something like that?

Yeah, well, we'll talk about that. So where, where do you— here, here's, here's where I would love to start. If I had— I was thinking about, I mean, you know, usually leading into these roundups, I take notes and I'll send them to you like, hey, here's what I think we should talk about. There's usually, what, 3 to 5 topics I think there were 17 on the list this time. So I was trying to think about a theme for this episode. And the theme in my mind is crypto companies do not care about the SEC anymore. The reign of terror is over and the shackles have basically been torn off of both the investors, the financial institutions, and the founders. And when I look at things like— we can, you know, we can talk about all these news stories one by one if we want, but, you know, Blur, There's a Blur proposal to turn on the fee switch for Blur. Um, BlackRock's Biddle Fund, um, which is tokenized by Securitize, is expanding from just Ethereum to Aptos, Arbitrum, Avalanche, Optimism, and Polygon. Coinbase launched meme coins. Brian is saying fuck on Twitter, right? Coinbase also launched bank accounts. These are all one big theme of the shackles and the kind of tirade of the SEC has come to an end. So I don't, you know, there's a bunch of other news things this week, but it was just a very— I listened to this podcast with Ben Horowitz and Marc Andreessen.

Horowitz Show.

Yeah. Talking about the impact of Trump and Marc used this. He's like, look, it felt like there was like a foot on my neck for the last couple years. And it's funny because, you know, Marc Andreessen seems like he's got this great life, but like, I think if you talk to a lot of the founders in the industry, my friends and your friends too, like it, that is what it's felt like for so long is like there's this— there's, you know, people— it's really frustrating because people say, look, what is the use case of crypto? You're like, I can't give you a damn use case because you're pinning down my arms and my legs. So this week was really cool because it was, uh, all these things. I'm like, yes, these are the— these are the freaking use cases. We just haven't been able to do them for the last 4 years. So, um, yeah, that was my theme of the week for the roundup.

Yeah, absolutely. Couldn't agree more. Like, one, you have to really update your thesis very quickly because it is materially different environment. And the second component is, yeah, let's definitely now talk about the amount of use cases that we know are there and we just haven't been able to explore because of this hostility. And people may ask, well, what about other places in the world that have been more pro? I'm like, no, you sort of fail to appreciate that the US will always lead. And if the US changes its tune, the rest of the world follows. It's always been like that. That is unequitable. Politically true. There have been some jurisdictions that have been trying to take advantage of that, but it just doesn't move it as much. And so when you think about the timing of things, there hasn't been a better setup in this industry ever. The prior Trump administration was not pro-crypto. The Obama administration was not pro-crypto. The degree of hostility has gone up as this industry has grown. Absolutely. Like, you have to update your thesis, and you've been in this space for a while. You may have grown cynical, which is the worst. And I had a tweet around this idea of, um, you have to always be skeptical. That, that's what makes you, I think, a good investor. But you always have to be willing to update your priors and with new information. And, and I think that's the difference between being cynical and being skeptical. And ultimately, yeah, if you've been in this industry and you haven't really updated your thesis or your targets, then you probably should do that because it's a vastly different environment. When I think about what I'm doing now, it's like, yeah, the timing is right to then start exploring all these things. Right. And let's just talk about the crypto business model. I'm actually super excited now. One, there's increasing M&A activity that we should talk about. How many more companies can go public now? Also interesting to observe. Kraken and Bitwise and a few others. The amount of M&A is going to increase, but also the amount of coverage from Wall Street will increase. And so I'm actually excited to see someone start comparing Uniswap with Coinbase or some other crypto-native business with a traditional business and saying, wait a minute, These are vastly more profitable businesses. You know what I mean? So anyways, you pulled up the Bernstein memo. Maybe we—

so I just pulled up this Bernstein. So Alliance Bernstein is one of the largest financial advisors in the world. They are— there's a, there's a, there's a big survey every year of who are the most trusted financial institutions in the world. And it's usually like, um, uh, JP Morgan, like, no, it's like Vanguard and then Fidelity. Anyways, there's a list. Alliance is always top 5. Alliance— I guess they took the Alliance off of Alliance Bernstein. Now it's just Bernstein. They're always 3rd, 4th, or 5th, usually behind Fidelity and Vanguard. Um, let me read to people if they missed it. This is from their global digital assets team on November 11th. November 11th. So people remember Bitcoin went on this big run over the weekend and then, you know, Wall Street can't really get access to Bitcoin over the weekend. So everyone's waiting for what happens on Monday morning. Monday morning, Bernstein sends out this list to their clients, the digital assets memo, "Welcome to the crypto bull market, buy everything you can." Quote, "Bitcoin is at $80K. We will keep it simple. Don't fight this. Add crypto exposure ASAP. Call us if you need help." I mean, that was a crazy, crazy, crazy thing to wake up to Monday morning. Yeah, actually, it was interesting to look at their, their— what they said. They said institutional people— this one didn't get as much coverage on Twitter because like the headline was obviously the most interesting thing. But if you actually scroll down this, you know, it's like a 20-page report. Institutional investors have a few choices: Bitcoin and Ethereum ETF, Bitcoin miners, AI-focused miners, Bitcoin corporate treasuries, crypto exchanges and brokerages. So as Bernstein puts it, there's only like 5 or 6 different ways to get exposure to this industry, which again, just reminds us how early we are. There's Bitcoin. There's pure-play Bitcoin miners. There's AI-focused miners. There's MicroStrategy. There's Robinhood. And then a digital asset set basket, which includes what they said was Bitcoin or ETH, or you could go to the 9 high-beta assets, Solana, Arbitrum, Optimism, Matic, Lido, Uniswap, AAVE, Chainlink, and Ronin. Um, and so I just thought this was a really interesting thing to see how the large financial institutions are talking directly to their clients about this.

Yeah, by the way, um, really interesting on this point, uh, on Hood, there's a great, uh, interview by Vlad, the CEO of Hood, uh, Robinhood that is, and he, and he talks about— people go listen to it— and he talks about how vastly He says we operate two businesses, traditional, like brokerage firm, and then we have the crypto side of the house. He says operating the crypto side of the house is an order of magnitude cheaper than the traditional one. I mean, I hear that and he's like, you're pitching my fund right now. And it's so true. Like, how many more businesses do you think are like listening and saying, wait a minute, and looking at that? I found that to be really interesting that he sort of commented on that. We know all these efficiency gains, but to hear Vlad talk about that is very interesting. They relisted Solana. They delisted it when it was $17. They relisted it when it was $220.

I have some very retail friends who just got forced— they were forced sellers of Solana at $17, and now they're like—

It's like the FTX estate.

Mentally, I can't buy back in. I was like, honestly, I understand that.

We should talk about the mental paralysis of seeing an asset do that and buying back in. But before we go there, The other interview that I want to highlight people's attention to is Solana posted this on November 12th, and it's that clip that you're referencing, Mark. I think Ben Horowitz talks about just basically how different this is, and people should go listen to that. I retweeted it.

We'll link it. It's a new one. Ben and Mark. The Ben and Mark Show on Spotify.

This one is just that Solana retweeted it. It's a clip, and it's Ben talking about He's like, the case of why crypto is so important— he loves music and he says artists, creators have been really in a tight spot in the current paradigm of these monopolies to get 5, 10, 20 at best percent of revenue share. And with crypto, it's like 98%. And if you don't appreciate where this is going, all you need to do is understand that economics, that drives everything. And so now that the regulatory— there we go, that one. Maybe you can play it. I mean, it's a minute clip, but I think it's worth people listening to it.

Yeah, let me, let me play it. Hold on.

I think, um, you know, Ben is— and Mark both have, uh, are incredibly good at, um, lending their perspective. Just came out.

Yeah, I mean, at least they were in the internet. So every crypto project, uh, that's out there has kind of gone up in value, but I think much more importantly than that In talking to founders, the number of things that people have wanted to build, and some of them so important, particularly, we have a lot of friends in the creative businesses in Hollywood, in art, in music, and they have been waiting for a technological platform that gets them past what they've been dealing with in these distribution monopolies and very difficult take rates from the people who are in charge of distributing the music around the world. Now, here we have this technology that lets the creatives basically, instead of getting 2% or 10%, depending on what platform you're on, or 20% of the money, get 98% of the money. We saw that Early on, before the crackdown, my friend Nas put out an NFT of a song that had been out, the album won the Grammy, and the song NFT made more money than the album, even though it came out late. That thing was so exciting for so many people, and all those projects shut down. Now, they're already starting to come back just in the last 2 days. I think that's tremendously exciting.

Yeah, exactly. It's like, I mean, these, these things were just crushed. You couldn't actually build what you wanted to build. So, all right, let me, let me go over to— there's so many news stories, I want to make sure we hit on a couple of these. The other, another interesting one from two different angles was the BlackRock Biddle thing. So, um, this is, uh, the— first off, this is the chart of tokenized, um, tokenized treasuries right now. So you can just see this, this is going up into the right. RWA.xyz does a good job. BlackRock has now overtaken Franklin Templeton and Ondo for on-chain with, with Biddle, right? They have 544 million of tokenized treasuries. If you click into this, you can start to look at it. So they used to just be on Ethereum. They're now on— the big news that they had is they now are on Optimism, Avalanche, Polygon, Arbitrum, and Aptos. So a few things I want to talk to you about is— so one, you can see Optimism is the only one that's gotten real capital in here. They all have about a million. Optimism has 26 million already in their token supply of BIDEL. So Optimism seems to be up to a hot start here. Why do you think that Base and Solana were left off here? So both Base and Solana were both left off. Why do you think that is?

That's a great question.

Yeah.

No, no, no. I mean, I was with the Aptos guys this morning. They were obviously super excited about it. I can think of why they chose Aptos. I mean, obviously they sort of benefit from— they've been very institutional focused since spinning out of Facebook. You think about the Libra Consortium, then became Aptos.

Aptos seems to be winning a lot of these.

I mean, look, I work very closely with them and I'm an investor. And so I think Movement as a programming language, my thesis has been, and I've said it here before, is very well suited for— it's a more secure environment. That's not to say that Solana is not a secure environment. I just think movement as a talk, I could appreciate why it would be more interesting or easier for an enterprise to appreciate and get. I actually don't know why Solana and Base are off this list. I don't know if you have theories, but it seems like in what version of this world would you pick Arbitrum and Optimism and not Base. Base is an implementation of Optimism using the OP stack. Solana is a more interesting head scratcher. Why not? I don't know. There are always people like I tweeted some of the effect of like Solana is 30% of Ethereum's market cap. I see no compelling reason why that shouldn't be at least 100%. And there were some folks in the comments saying, well, Larry is not going to deploy in Solana. So people were sort of intimating of that. I don't know if they had some sort of inside knowledge or not, but I don't really know. Do you have theories? You're muted.

Thank you. No, I have no theories. I mean, there are a few names that keep showing up in these institutional deals. It's Aptos, Avalanche, and Polygon. Those three just keep winning these institutional deals. Base, I would have thought would be in here because I think BlackRock and Coinbase are so joined at the hip on a lot of these deals. Um, and so, because I mean, uh, Coinbase does the custody for them, right? So, so I, I, uh, yeah, exactly. So I only, I spoke with two folks about this. Um, their take on why Solana was left out, and I have zero clue, I have no idea if this is right or not, is the meme coin stuff is actually hurting Solana with some of the institutional players. They're like, look, that, that's That's kind of— that's like we can't really touch that chain right now. So, you know, the counter is like Solana has won a lot of institutional deals too, but the meme stuff might actually be hurting Solana when it comes to the institutional deals. I have no clue. Ben would probably know, or Akshay or Austin or something like that.

But I'm catching up with them later this week, so I'll ask.

Yeah, get the take. Get the take.

Who else? Like this meme coin stuff, how would we be able to quantify it like that? Like, have you heard it from actual institutions? Many institutions? Do you think it's actually It was the—

yeah, it was the head of blockchain at one of the big— at one of the big banks with a decent-sized blockchain team. So yeah, that was— well, and maybe we can bring someone— maybe that person would come on the podcast. We could talk about that. The other interesting thing I thought was— so first off, Securitize is crushing these deals. Securitize is on all of these. Seems like an interesting battle between like Securitize and Ondo maybe. I'm not sure if they do the exact same thing, but the other interesting thing is BNY Mellon. Is actually the custodian for Biddle. Uh, so it's not Anchorage or Fireblocks or BitGo, it's actually BNY Mellon. And one of the things that is going to happen in a Trump admin is these banks are actually going to be able to unlock the custodianship of a lot of these digital assets. So it's cool to see BNY Mellon. I mean, is it good? Is it bad? I don't know, but it was, I think, I think it is a big unlock for the industry seeing BNY Mellon as the custodian there. Um, and then the last thing that I thought was interesting is this, some of these chains and tokens are under pretty heavy SEC scrutiny, right? They've been mentioned several times in, you know, in different SEC filings. And for now, the BlackRock stamp of approval has basically been extended. And they're like, sure, sure, Polygon has been mentioned in SEC, or sure, you know, a lot of these other ones have been mentioned. And now BlackRock has— it's just another sign that this SEC reign of terror is ending.

So on that point as well, Coinbase listed this week Pepe with a bunch of the meme coins that they haven't historically. Yeah, let's talk about that. Kraken did as well. It's just, yeah, you have the chief legal officer of Coinbase tweeting exactly this, which is we're going to list. Yeah, it was Paul, I think, was tweeting that. About the Pepe listing. That's just a big, uh, big F for you, I guess.

Yeah, I mean, two big— I'd love to talk about two big Coinbase things this week. So one is they started— they listed what, Pepe and, and WIF. Um, and I thought this guy Pickle Crypto had a good, good take, uh, which is significant for two reasons. One, Coinbase and Robinhood don't care about the SEC anymore. This is the Trump effect, uh, going into play. And two, if Coinbase— I think he said lost, but it's— I think he meant to say list. If Coinbase now lists PopCat, it becomes a serious player to rival Binance dominance in the meme liquidity. This forces Binance to start listing legit on-chain stuff without charging fees, slash a cut of the native token. The context there that he didn't say is, you know, if you're, if you're, if you're a token, you oftentimes have to actually give Binance like between 5 to 15% of your token supply. which is an egregious amount, right? Let's say you have a billion-dollar FDV, 10% of that is $100 million. So Binance is just printing on these listing fees. And so what this— this is actually a really interesting second-order impact that I hadn't really thought about, which is Coinbase starts to get the meme liquidity, forces Binance to start to list other stuff outside of just memes. Really not good for the industry. So yeah, hats off to Coinbase for doing this. I mean, also, if you listen to our meme episode from 2 weeks ago, those 4 memes not doing too shabby. Not financial advice, but my God, if you listen to us.

Yeah, I should say, man, we didn't talk about Peanut. Uh, yeah, we'll see. WIF is doing okay.

WIF is doing all right. Um, the other interesting, uh, on the complete other side of the spectrum, so this is Zach from Bridge. I think a lot of people miss this because it's not really a number-go-up technology type of thing. But this was, in my mind, even bigger than them listing meme coins. So Coinbase actually launched free US bank accounts so users can open a bank account which is automatically linked to their non-custodial wallets. This is Zach, the founder of Bridge, saying another big launch. Consumers across the world can now use Bridge to create a virtual US bank account. All payments land in Coinbase's wallet as USDC on Base. So it's really hard in the world to get a bank account, and it's really hard to move to connect the crypto world to actually the US banking world. And this is a really big step forward, I would say, to do this. Um, and so just, yeah, big, yeah, big shout out to Coinbase for— and, and big shout out to Bridge, obviously, for launching this.

Yep.

Um, anything else on these meme coins?

Well, Peanut was ridiculous, uh, run-up. I mean, my God, it went from basically zero to $1.7 billion. Obviously Peanut was very tied to— you had Elon Musk, you know, talking about it. It was important in the election. It'll be interesting how it performs like over the next subsequent weeks. Uh, there's been a lot of profit taking from people that basically— this guy pumped it like $17, profited $3 million, like crazy, right? Um, I think it's just sort of— so that was obviously, uh, the, the latest flavor of meme coins that you probably missed. Um, and you have the Murad sort of coins haven't been doing as well. Um, I find that to be interesting. Uh, of course it's all— Uh, I think animal coins are like now back on the menu. Like, I think it's just something about like Doge, like Department of Government Efficiency. You have like Doge just is capturing and sucking all of the air of meme coins in many ways. Um, and I sort of think that that's going to be the case for the next couple of weeks. I mean, there's a credible way, a credible scenario where Doge flips Solana and then flips like Ethereum. Like, I, I'm pegging that probability higher. Like, Doge is now sitting at $56 billion, 6th largest market, uh, crypto asset by market cap. Uh, 2x from here, it flips BNB and Solana.

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Well, that's something that I— perhaps it's a topic for a whole episode, but I've seen it in so many cycles that people— how many people do you meet? And it's like 9 out of 10, I think, on my side, that you meet and they tell you, oh, I saw this super early on, and then I just saw that candle that is vertical, and I, and I didn't, I didn't buy then and there. I just couldn't get my head around buying an asset that went vertical. Uh, this chart, you could have looked at Bitcoin in 2012 and said the exact same thing. It's like, my God, Bitcoin was like less than a dollar. And it's now like $80. I missed the train. I'm an idiot. Ethereum, no different. Solana, no different. Every asset in crypto and most people that come into the space, the brain is not programmed to think in nonlinear exponential terms. It's just not. And it hurts when you see something and you don't buy it. We've said it before in these— in time and time again, and none of this financial advice, but I do prescribe to this idea of Stan Druckenmiller, which is Buy first, analyze later. If you have an inkling, if you want to pay attention to something, size it appropriately. Buy a small amount so that psychologically you insulate yourself from this paralysis that is so often when you don't buy something, you're like, it eats at you in a way that it paralyzes you and you can't re-underwrite the thesis. So let's talk about Doge here. Doge has gone up over the last 7 days 100%, right? It's sitting at $56 billion. The question is not so much why, like, oh, it's gone up 100, I missed the move. It's like, no, can this do another 5 or 10x? Because by the way, if you're in crypto, that's, that's like your return profile. It's still down 47% off the high, which was $0.73 over 3 years ago at the peak of last cycle. So the question is, can it reclaim that level? If so, why? And so you zoom out and you say, okay, let's think about what we just said at the beginning of the episode. It is a very different environment. I don't think there's a better setup for crypto ever. You have ETFs, and you have what has been a choke point for this industry has gone away and is going away. You have a president, incoming president, that launched an NFT collection, and you have institutions that are now more willing to allocate to the space because you have more accessibility and the infrastructure has come a long way. You combine all that and you say, are we going higher than last cycle? Yes or no?

Yes.

Okay, you make up your own mind about that. Sure, sure. And then the question is, then from an asset selection standpoint, whether you want to do top-down, bottoms-up, what will outperform? What is the best way to play this industry? And then, and then you ask the question, is it going to be means? Do you believe means, yes or no? Do you think they're going to outperform Bitcoin? Yes or no? And from there, you kind of do this peeling of the onion, right? And you say, can Doge— I know it's sitting at $56 billion. What do you need to believe for it to go to $100 billion or down to $20 billion? Just make up these scenarios and ascribe probabilities to them. I think it has lasting power. People appreciate it. Like Moonshot, which is this wallet, the exchange that makes it super easy for people to onramp and buy A lot of these meme coins and just crypto assets in general has had record inflows. So have exchanges. Coinbase was down yesterday. So I don't want to instill FOMO, but I do think it is just important to like, when you see a chart like this, yeah, I know there's like mean reversion and people take profit, but you have to ask yourself, and it's difficult to do this analysis in a week time, like who knows where Doge is going to be in a week? But I think it becomes easier to understand where's Doge going to be in 6 months or a year. Yeah. So if you have a longer time horizon, I think it's easier to make up. And then you just sort of position yourself that way and say, okay, maybe I'm going to cost average into asset A because I think it can do a 10x or a 5x or a 2x. And this is a risk profile and this is how I'm going to measure it and weight it in my portfolio.

That was going to be my next question is around entry points. So, okay, let me actually tell you about a text conver— I'd like to hear how you would respond to this text conversation. I get a text from a friend. She owns zero. She owns no crypto. She goes, Jason Yanowitz, what is a, what is a good meme coin? Or is there a Reddit forum I can read? I say, they all just got listed today on Coinbase. Bit late. She goes, way to be a downer. So is crypto over? Should we be selling? I said I said, look, we— I own, I own 3 meme coins, but I don't know if I'd be buying those because look, you're, you know, you're not like— I don't want you— I don't want it to go down and you lose, you lose money. She said, what's the crazy new thing to do? And I said, I would just buy some Bitcoin and Solana, small, small amounts. And she goes, isn't, isn't Bitcoin and Solana really high? And I think that's the mentality of a lot of people is it's exactly what you were saying, which I said, I said, that's not the right way to think about that. People have been saying an asset is high since Bitcoin. And I mean, not even crypto— Amazon, Apple. You know, you could have looked at a chart of Apple 5 years ago, said, isn't Apple high? So I'm curious how you would recommend someone like that if they're like, I want one mainstream asset like Solana, Bitcoin, ETH, something like that. One meme coin. Do you tell them, hey, just go buy Doge right now and like, this thing could fall 50%, but like, just hold it for a year and close your eyes?

You could say that, but why do that when you can have and invest in a number of assets? Like, like, it's not like you're buying Berkshire stock that is like $100K plus. Like, you can buy a basket of these things. The question is, are you going to pay attention? Like, keep your normal— if you have a normal job, you have cash flow coming in, that's the best position to be in because you can allocate to this asset class And like, you mean like not have to stress day in, day out? It's not— you're not doing it for a living. It's all upside, I guess, because you're going to pay attention, you're going to listen. And if you lose all of it, then I guess it doesn't hurt you as much, or you survive, right?

Yeah.

And you can be aggressive if things fall. Like, yes, I would be prepared to see a lot of these assets fall at least 50%. So however you want to think about like allocation, then There's no winning formula here. Ultimately, investing is such a psychological sport. What you don't want to be doing is overtrading, and what you want to be doing is not having to be a forced seller. Just position yourself so you can be aggressive when others are not. I mean, I know I'm saying obvious stuff, but honestly, I've seen time and time again people in every cycle just over-lever, or it's always like the, oh God, I want to find the next Peanut because $17 can turn into $3 million. I'm like, yeah guys, but like, like, no, like, just, I appreciate that. Maybe you want to buy a basket of like sub-100 million, sub like 20 million meme coins and punt all of that. Does that outperform Doge? I don't know, maybe if you catch one of them, one in a million, uh, but it carries 10 times more risk units. So it's always like this trade-off between how many more risk units are you taking versus the return profile. I know people want to hear specific asset selection. I'll tell you my asset selection, how I approach this space has changed dramatically. Yes, the size matters. I can't buy sub-$10 million, sub-$50 or sub-$100 million coins as easily, like in size. No. But historically, Doge has been and has survived many cycles. It has brand power. I mean, it'd be I'd be dumb not to mention that Elon is, you know, it's— he's going to continue to use Doge because it's now, you know, embedded in the sort of like the government agency.

And so, I mean, we've got an actual government department called the Department of Government Efficiency. There's a new account on Twitter called— let's see, Department of I mean, this thing is—

oh no, it's the, the handle is Doge. Look at it.

Look at the logo. It's a— it's Doge.

No, I, I'm not sure. It's— is it that? I thought it was just Doge. No, no, no, that's not it. Go to Doge. No, it's literally just this.

No, this account is verified because it's an official government organization. This is—

oh, I see it. I thought it was not affiliated. Oh, don't— yeah, okay.

Not affiliated with, with Doge, but Department of Government Efficiency.

Oh wait, community. Yeah. Oh, oh, oh, no, go to Doge. Just Doge.

Doge.

@doge. Yeah, that. Yes. I thought it was that one.

Oh, oh yeah.

That's like zero followers. What?

I thought that. Yeah, you're right. Yeah. Okay, you're right. I'm following that one.

Yeah, you're on that one. Yeah. Anyways, um, listen, I think— listen, yeah, there's a lot of that. Listen, listen, I'm not here to tell you how you can construct your portfolio. Um, just bear in mind that you're not a genius. The market goes up, Keep that in mind.

Have a heart to heart with a Blockworks employee who just made some life-changing money on, on one of the meme coins and discussed quitting. Listen, some good heart to heart before the episode.

You make life-changing money, change your life, but also appreciate that. I've seen so many people think that they've made it and want to retire, and it's just like taking a vacation. Fine, after 2 weeks you want to go home. And you want to get back on it, and sometimes it's hard to get back on it, just do the— I heard it from Jeff Bezos. The best thing about money is that you can position yourself so that you can take time to do whatever it is that you want. You own your time, and that is the ultimate definition of wealth and financial freedom in my mind. And then it allows you to just play the game that you love in the way that you want to play it, not how other people are telling you to play it. And that's so liberating. So Lean in. And if you're not there, well, I'm not here to tell you what to buy. But I am telling you categorically, there hasn't been a better setup in this industry ever. And I've been here for a while.

Yeah. Speaking of that, ETFs with a monster freaking week. Let's get away from the meme coins. I love this term by Eric Balchunas, the Bitcoin industrial complex. It's fucking amazing. I got to stop swearing. We get demoted in Spotify. I learned if we swear.

I'm not swearing anymore.

No, honestly, I'm just taking after our Lord and Savior, Brian Armstrong, who swore on Twitter for the first time ever.

Then he deleted his tweet. Oh, did he? If only you shaved your head. But, you know, here we are. Next. Next.

The Bitcoin industrial complex. ETFs, MicroStrategy, and coin. So it's an amazing combo. Saw $38 billion in trading volume. This is November 11th, which was Monday. Lifetime records being set all over the place, including iBit, which did $4.5 billion. Robust week of inflows. Just an insane day. It really deserves a name à la Volmageddon. Eric Balchunas, he's nailing Twitter these days. Good, good job, Eric. Look at that. Look at that chart. Just a monster fricking inflow for the Bitcoin industrial complex. Bitcoin.

That's a Bitcoin ETF, not the Ethereum ETF.

Yeah, but the Ethereum ETF is also—

Ethereum ETF also had decent inflows.

Is doing all right too. Let's talk ETH. Let's talk ETH. Oh my God. I got absolutely destroyed in my DMs. People were very upset with me. Um, I'll pull this up.

Why were they upset?

Oh, by the way, NFT bull market 2025. What do we— what do we— we'll come back to that. Um, I tweeted— hold on, too many damn tweets these days. I tweeted, I said, okay, so basically, um, uh, what's, uh, Justin Drake— Justin Drake shared this thing at, uh, at DevCon, and the context to tee up this presentation was he's like, this is the most ambitious thing I've ever worked on. Like, this is going to fix Ethereum, etc., etc. So everyone's really excited. So he shares this thing and this is the timeline. And I looked at the timeline and I said, I tweeted this out. I said, I'm sorry, but does this actually say Ethereum 3.0 ships in 2029? Nothing ships on time. So realistically, it'll be 2031. That is 7 years from today. And that is— and by the way, this, the proposal is just to improve the consensus layer, not the DA layer, nor the execution layer, nor the EVM. I said, that is actual insanity. Go ship a damn product. And I got, you know, basically I have 50 DMs saying, lol, this is the best tweet I've ever seen. And 50 DMs saying, you're a clown. What does a podcast person know about launching products, et cetera, et cetera. What I'm curious if you have takes on this, or I can just give my takes right out of the gate.

Please do.

I think that I— okay, I think I have a couple takes. One is I do think I was being a little harsh, like a little harsh, because this is actually really tough. Like, you know, David did actually— David Hoffman David Hoffman, did have a good response, which is, which is fair. And Cygar, who's building, um, uh, I forget the L2, Abstract L2, also had a good response, which basically says, look, this ignores the fact that this product must be built 5 separate times, one for each Ethereum consensus client. I acknowledge that. I acknowledge it's really hard shipping, shipping, like updating the Ethereum consensus client is much different than You know, we shipped better notifications at Blockworks and a better data dashboard this week. Very, very, very different things. I totally get that. However, what I— David said, David asked this thing. He said the process is much slower. Decentralization, client diversity, just saying ship the damn product is asking Ethereum to look and feel like a single client centralized organization, of which it's not. This is what decentralized looks like. It has its costs. I agree with all that. And then he says, what do you value? What I value as a startup— let's remember, Ethereum is still a startup— I value not dying over every other thing. I value not dying. And Ethereum—

what is not dying?

I think Ethereum is facing this existential—

is it facing into fading into irrelevance? Or I guess the path here of dying would be cutting corners, having a catastrophic bug because you're moving too fast. Or fading into irrelevance? Two versions of dying in my mind.

Market share, in my mind. So if you fast forward 10 years from now, if ETH has 1% of the market share and all these other chains make up 99%, but ETH has never had a bug, that's, that's dying. ETH died. So look, should it take one year? Should you just max centralization, ship this thing in a year? Definitely not. Absolutely not. But should it take 7 years to go ship this thing? Absolutely not as well. Absolutely. Like, you know, you've got a year and a half for pilling, a year and a half for speccing, 2 years for building, 2 years for testing. Like, give me a break. You got to ship something faster. I do not care. Like, yeah, keep the decentralization, all that stuff. Just figure out a way.

How do you— faster? Well, that, that's, I think, the response that Justin would say. It's like, you want to be truly— this has always been the line of defense. It's like, if you want to keep the centralization, Ethereum's to a point where at the product level is decentralized because there's multiple clients, there's multiple organizations. And so is it the chain— is the layer 1 is really decentralized? I guess you could argue how you measure that, but it's just, just call it, it's decentralized. The product is as well, and it just becomes incredibly difficult versus other projects that might, by the way, still have the same or similar level of sufficient decentralization. Notice I said sufficient decentralization, but have a centralized product organization or one client or maybe two. Like Solana's going to two clients now, maybe more. How does Solana look in 2, 3 years' time? Is it going to face the same level of challenges? I'd argue probably not, because— but then you have to wonder, at what point do you harden? I think the issue with Ethereum—

yeah, at what point do you harden the protocol?

Yeah, but the key here is if Vitalik were to re— and the initial creators of Ethereum were to re-architect the protocol today, it would look closer to a Monad or Solana, maybe Monad because of the hardware requirements and whatnot. But I think if you were to ask Vitalik, hey, if you were to rebuild it from scratch, he would do it quite differently knowing what he knows now about other implementations and other projects. And that's the issue with Ethereum that I have, which is just the backward compatibility issues of No matter how much you want to change, it's very fragmented. And I think this is both the beauty and the curse of open source, right? By being first, there are less, I think, first mover advantages. Bitcoin, certainly, yes, because it's pretending to do one very focused thing. which is being non-sovereign store value. But Ethereum is an expressive general open source contracting platform. And I know that's a jargon, but there's other competing platforms around that. I just think that, can we agree that if you ask Vitalik to do it again, he would do vastly different parallelization, a few components that just can't be implemented. And the question becomes, how much can you actually innovate with the current set of constraints? um, and limitations around convincing people, right, and backwards compatibility and all this stuff, there's only so much you can innovate. And whereas if you look at something like Solana or maybe some of these new other chains, Aptos or Monad, then you wonder like, is this going to matter? And for everyone out there that says, well, Ethereum is really hard and it has no bugs, It has had bugs, by the way, and pretty big ones at that in the early days. It's just sort of hardened. Yes, it has the most amount of developers. Yes, it has the most amount of users. But I sort of think it's sort of like a mute point when you think about where's the slope of the curve and where are the next 100 million, 200 million users going to come? And I just think it's to your point, you wonder, like, are they prioritizing the right thing?

So here—

and no matter how much you want to build, and even if you can figure out convincing everyone in the community and all the different clients and whatnot, is it going to be a marginal piece of innovation? And how is it going to compare against some of the other chains? Um, and are you going to be at a— just a technological disadvantage?

Yeah.

And I don't have good confidence in that, their ability to pull that off. I admire and respect the effort, but I am just seeing a clear line of path in other chains.

Yeah. So Saigar had the best response to this. I really actually do want to do like a bull case for Ethereum episode.

Is this xMaker?

This is your ex, Saigar. I don't know.

So I've never met Saigar or Cyrus. Anyways, go ahead.

He's building— no, not Cyrus— building Abstract. But he had the best response and we're sharing it if you're watching on YouTube and maybe we can actually have him on. I want to do like a bull case for Ethereum thing. Maybe we can have like Hayden and Saigar because, you know, Hayden kind of subtweeted me and said, lol, people dunking on Ethereum thinking 5 years in advance. It's like this industry is allergic to long-term thinking. Also this is a vision subject to change and input. Um, and my quick response to that would just be, this is not a vision, this is a tech roadmap. So like when we build something at Blockworks, like we will lay out a vision. We want to become the best on-chain data providers by the end of data, uh, 2025. That'd be, that'd be a vision, right? And then we sit down with our CTO and we figure out how we're getting there and we make trade-offs. And you know, that, that is the That's the tech roadmap. That's the product roadmap. The vision here, like a vision is very different than a tech roadmap. And Justin laid out a research-driven tech roadmap that is going to ship in 7 years when this industry will look orders of magnitude different than today. So I would love to see Ethereum have a clear vision. I agree with Hayden, but what I saw at DevCon is not a vision. It's a tech roadmap.

Again, I would like to have more sophisticated, knowledgeable people here because I think it ultimately comes down to, do you believe that— like, put aside the TVL and the users. I know it's important, but I just don't think that's like the moat. I think the more fundamental question should be, can Ethereum maintain or compete not in the super long term, in the, in the near term, as you have, um, as you have, uh, these chains like Solana and, you know, some others that are launching or live, like Aptos. Um, and I think we're gonna— as I've said before, we've all been beta testers for the last decade in this industry. It's like sort of like a speck of dust in terms of TVL and users. Yeah, but you when you think about where most of the activity, recent activity, most of the recent project launches have happened, I appreciate there's some good ones in Ethereum, but the vast majority of them have not been on Ethereum. Base is encouraging. Of course, it has a lot of distribution from Coinbase. I'm not here to discredit— I'm an investor in many of these projects, but I'm just objectively— and if people disagree and think that I'm not being objective, please call me out on it. But I'm just observing most of the best projects be interested in Solana or some other chains. And it's the slope of the curve that I'm interested in. And can you build a thesis around where the next 100 million developers and users and billion users going to exist and live? But then the counterargument to all this is like, well, look, BlockRock made a clear signal and maybe that's you know, that's going to matter too.

Yep, yep. Um, okay, let's, um, let's, let's move on from ETH. We should have, uh, I'm gonna text, I'm gonna message Higar and like maybe Hayden. We could do a, or we can do like more of a like Vance and like bull case for ETH or something.

But yeah, I think, I think Kane had really good takes here on as well, by the way. Um, he's— Kane should probably be part of that discussion because he's more balanced and He's come over to quote unquote— when I met him in Australia like a year ago, he was like, I really need to get up to speed on Solana. This thing has really just been interesting. Now what he's doing at Infinex, I think, is that right philosophy, which is make it sort of very friendly for users. And he's taken a very practical approach.

Yeah, cool.

By the way, practical doesn't mean cutting corners or not valuing decentralization or security. Yeah.

Kane said, in my IMO, the reason for the reaction to the 2030 timeline is we already have a long-term roadmap for Ethereum. If we're going to propose radical alternatives, they should probably optimize for speed and deployment, speed of deployment. Also, any proposed timeline in crypto gets blown out by like 2 to 3x minimum. So most people are, most people are internally adjusting this to be like mid-century. Lol. All right. Moving on from this interesting news of the other thing, two acquisitions and a merger all in one day. This was on Wednesday. There were three deals that were done. Obviously, these deals are not done on this day. They all just announced on this day. But really interesting to see M&A speeding up in the industry. And I tweeted, I'm thinking that we'll actually— this will actually be the cycle we get substantial M&A. For context, I'm sure you've heard this even longer than I have. As long as we've been in the industry, people say this is the cycle we get M&A, this is a cycle we don't get M&A, that we get M&A. And the reason we got no M&A last cycle was because there were blowouts in the valuations. So if you had a really good tech company, that was for sale, your valuation expectation was so egregiously high because maybe you raised it 100 times revenue that the buyer says, there's no way I'm buying this for, for your valuation expectation. And the seller says, well, my valuation is way higher than you want to give me. There was this massive mismatch that was driven by ZIRP, which caused excess funding in the venture ecosystem, which actually really drives down M&A because of valuation mismanagement and misexpectations and differences in expectations. So this cycle, I think, is going to look a little different. So there are 3 deals I want to briefly touch on all of them. So the first one was Coinbase acquired the Utopia Labs deal. And just for full disclosure, I don't know if you're an investor in Utopia or— no. Okay, cool. So the best take I saw was actually by the products lead at Avara, this guy Jeremy Black. He said Coinbase buys Utopia Labs they need to get rid of bridge. Anyone serious about stablecoins needs to own the entire stack from issuance to liquidity. It's the only way to architect for scale and give customers a good UX. The stablecoin team is an internal platform team. And, uh, someone said Utopia used bridge themselves, and Jeremy says, not surprised. The hurdle for on and off ramps in the US has always been about finding adequate bank sponsorships. This is why nearly all of the stablecoin payment infrastructure players that started in 2022, got stuck doing only off-ramping for the first year or two. Coinbase solves this for Utopia by bringing them bank sponsorship while Utopia accelerates Coinbase's roadmap to seamless stablecoin payments. And for a really good take, really interesting analysis of the acquisition. Seems like a good deal for all parties.

Yeah. Who's next? Next we have Next we have, like, next to me, like, who, who do you think is kind of— and you remember, oh, who's next on the M&A? Listen, when Coinbase was trading at $40, I mean, that should have been, that should have been acquired then and there.

Like, it was, dude, my prediction was that JP Morgan would try to buy Coinbase, and we had that both as a prediction, uh, 2 years ago. Now we got freaking Coinbase is gonna buy JP Morgan.

Come on. Yeah, like, come on, maybe we should talk about— maybe we should talk about like that, because Coinbase is launching some really interesting products. Uh, if nothing really stops it from being a full-fledged financial institution.

Yeah. Next up, uh, Bitwise bought Ether staking— Ether staking service Attestant. Um, Bitwise will manage $10 billion in assets after the deal. I don't know how much it was, uh for, but, uh, Hong, the co-founder and CTO of Bitwise, put out a good thread. So Bitwise is acquiring Attestant. I don't know why I can't pronounce that. A non-custodial institutional Ethereum staking provider with $4 billion in staked ETH. They're ETH staking experts, open source contributors, engaged community members, etc., etc. They're rebranding Attestant— I gotta stop saying that— to Bitwise On-Chain Solutions. Um, Yeah, really. Basically, the second— I would guess the reason behind this is that Bitwise believes that the Trump administration will unlock a new thing for ETFs, which is the ability to stake from ETFs. I think staking—

huge, by the way.

Yeah, I think Ethereum ETF staking is now on the table, which would obviously improve the ETF products. And so I would guess that Bitwise is preparing for that world.

Right.

Yep. Yeah. Last deal. I would love your take on this one. This is ARCA and BlockTower are merging. So Jeff Dorman's fund ARCA, Ari Paul, who's been very quiet recently, but, you know, was definitely one of the bigger characters in the 2017 market. Yeah. BlockTower and ARCA are merging. First time I've seen something like this. Would love your take. Obviously BlockTower had that big hack. Arca never really got as big as— They have very contrarian ideas like activist investing in DAOs, and they were really early to fundamentals investing, probably a little too early. Just very curious to get your take on Arca and BlockTower merging.

Is it just them combining forces? Like, I have two funds, full equity.

Yeah, full equity deal, just merging.

Yeah, yeah, um, yeah, I mean, I don't know what they're— yeah, good for them, I guess.

Um, no hot takes, right?

No, no, no hot takes. I mean, it's just I, I don't see synergies. I just think that, you know, maybe it's a combination of resources. And yeah, both of them, to your point, having in my mind like they're good organizations, they're just not tier one. And maybe they just want to combine assets. And there's something to be said around— like BlockTower has credit strategies and also directionally long token strategy. And so Arca does mostly just like a traditional fund, like long only, but some activism, but long only and no credit strategy. So yeah, I mean, good, you know, Jeff and Wishing Jeff and Ari continued success.

What a weirdly polite response.

I don't know. I don't know what to say. Like, I don't have any insight as to why they merged or why they didn't merge. I'm like, yeah, I wish every manager in the space success and not blowing up or doing dumb shit for their LPs.

You know what I mean?

We don't need more chaos. Hey, I mean, we don't need more chaos or blowups.

Uh, it's like people who write all their emails like, hi Santiago, I hope this email finds you well. All, all, all of the best. Wishing you a, a, a happy and nice, uh, productive—

it's like the holiday card. Well, you know, you know, like the, I've saw like the meme of like, I hope this email finds you well. And like, it's the meme of like the guy just burning up and like, this email does not find me well. This is, this is not a fucking email found me well. Oh, sorry. There we go. I cursed. My bad. Sorry, Jar.

5 bucks. All right, let's, let's zoom out. Talk about all these, uh, the very last thing is, um, actually Blur. I'm less interested in the actual Blur proposal, but I think this is going to be a thing that you're going to start seeing over and over and over again. So, uh, there was a proposal to turn on the fee switch by Blur. It was proposed by Split Capital. Basically, if you kind of run this one by the numbers, they're doing what, like really low volumes, like $3 million in daily volumes. I think the fee was like half a percent or a full percent. That's like roughly $6 million in fees at their numbers today. Blur trades at like $900 million FDV, so that would be sub-1% of the yearly fee revenue. If it was shared with the whole supply. 1% of fees on like no revenue is obviously not super compelling. So, you know, the token didn't— like Blur didn't really do much on the news. I think it shot up like, I don't know, 5-10% on the news, but now it's pulled back already. You are the most interesting— there's two interesting takes that I have here or takeaways. One of them is I think this is just going to be a theme. Like, I think you're going to see all of these DeFi apps start turning on the fee switch, like one after another, after another, after another. Um, and I think that's a really good thing. The second thing is I hadn't gone to Blur's— I hadn't looked at Blur's FDV in a while. It's sitting at like $800 or $900 million. Uh, that is only $100 million less. I gotta re-pull this up. Let me make sure I get these numbers right, because this doesn't seem right. Blur, CoinGecko. All right. So Blur is trading at— oh, all right, $700 million FDV. Blast is trading at $850 million. All right. So Blur is only a $200 million FDV lower than Blast, right? The L2, both built by Pacman. I know you're an investor in both of these. Just kind of like a narrative violation seeing this, an app almost flipping the L2. I don't know if you have any thoughts on that, but yeah, it's, you know, uncommon because I'm an investor.

But yeah, Blur is at what, similar valuation?

Blur is at $650. Blast is at $850.

And mind you, that's where NFT volumes have really come down quite a bit. So we'll see. I mean, it's, uh, so I would categorize Blast L2 trading in similar territory as a few other L2s. Um, like Scroll is at, say, $700, $600, $700.

Um, yeah, $600 now. Oh my Lord.

And then you have, and then you have a few others that are trading in that territory. Um, Yeah, we'll see. I mean, obviously it's a very competitive L2 environment and I—

All right, maybe let me pivot the question. Do you think that we see NFTs start to come back? You know, I was seeing on my timeline, it's like, you know, Dudis is tweeting about buying NFTs. People are talking about Punks. You know, Bobby, the founder of CoinGecko, is like, my penguins are going to rip. I had a little tweet talking about Pudgies, but everyone's got— you got to remember, everyone's got bag bias, right? I've got a bunch of Pudgies that I want to see up, you know, go up, obviously.

Um, would you sell them if you— if, if— I don't know if you're down on them or not, but would you sell?

I am. I'm up pretty big on the Pudgies still because they, you know, they're doing quite well. They're still sitting at like—

yeah, they're one of the collections that held the most value.

Yeah, so if you look at nftpricefloor.com They are— so Punks are sitting at 33 ETH, um, Bored Apes are sitting at 11.5 ETH, Pudgies are at 9.

By the way, Punks, the top was 105 for the floor, so— and I bought probably the top for one.

You bought right here, right about that.

That was me, ladies and gentlemen, right there. Well, the, the Punks that I have, like, in public, uh, the bandana Punk I was 105, ladies and gentlemen.

That was half a million bucks.

And I, you know what, like, I have it walking in the corner of my house. Like, I have it straight. I have like a couple of my points. I have that one front and center. You know why? To remind me, you're not that smart of an investor. By the way, I collect, I don't invest. I don't— I've always said it. That's what everyone who's— that's what everyone who's down on there, that's the coping. I'm like, I'm a, I'm a curator collector. You know, I mean, there's all— to be fair, there was always a price. If someone came in and said, like, yeah, I want to buy your Bandana Punk that you bought for half a million for like 10 million, yeah, yeah, I'll have it. No, don't have it. Um, there's more productive use of capital. Uh, I, I wouldn't get rid of my Hody Punk, to be fair. But, um, where are your punks?

Where can we see what, what punks you own?

Uh, there's two of them that I display. The Bandana, the one that I have in my PFP and the bandana one.

I haven't seen the bandana one. That's cool.

Yeah, yeah, yeah. But here's— you've probably underperformed on ETH terms. Maybe not, but like— or Solana. Like, if you— the— yeah, now let's go— let's not USD, let's go on ETH terms. I don't know how much ETH you put into it. Yeah, yeah. Are you— are you out— have you outperformed the underlying, meaning ETH?

Well, yeah, yeah, yeah, yeah, yeah, because I didn't buy—

yeah, you bought 2023.

I bought— I know exactly when I bought because I bought right after we did that episode, Luca Nets Empire podcast. Yeah, we I don't know. I don't know when we did this. Yeah, July of '23. I bought probably 3, 2 to 3 weeks after this because I went back and relistened to this episode and I was like, oh my God, this guy's actually going to— this guy's actually going to do it. So that was July. Yeah, I think I bought for like 4, 3 or 4 ETH. Yeah. So, you know, I'm, you know, I'm up, I'm up 3x. But anyways, not to talk about my Pudgies. What do you think happens with NFTs? Do you think these come back or is that just cope and it's all just floods? Still floods into meme coins.

Let's go. Look, I think, I mean, yeah, are they going to come back? Yeah, that's a wealth effect. As soon as people start making money, they want to buy watches, cars, check Zillow. NFTs is part of that behavior. There's some scar tissue that you have to overcome from people that are way under on their NFT bags. So you're going to have to clear that to then maybe break new ground. But meme coins are easier. Meme coins are better versions of NFTs, right? They have, they have more liquidity. They have— they don't have the, the, the unit bias, right? Um, and they, they're, they're just— are they on the spectrum of like, what do you value, liquidity and then emotional cachet? Like, you feel really— you still feel part of a really good community if you're in Peanut and Doge and WIF. Um, but you— the, the sense of ownership is— I'm not going to pretend like it's as much as you own one rare piece like your Pudgies, um, but there's a whole subset of people that are just, you know, still are there for the entertainment value in the community, and you get that from memes. And so I think, uh, I don't think— I think NFTs have probably bottomed here, but I would probably— I, I would argue that most of them will not outperform memes as a basket. Yeah, at least not this part of the cycle.

NFTs maybe towards the late, late, or late, last real late cycle, the real late.

And that's the issue, right? That, that's the issue with NFTs that you have, is like you don't have the liquidity of a meme coin. And so you always have to think about, you're never going to be perfectly timing these things, but if you're going farther out in the risk spectrum, you're buying, you're trading more risk units for more potential return. You always have to think about You're not going to be able to time it, but can you get out? And what's the size of the door on the way out? For NFTs, it's this size. For memes, wide open door. And so like, you have some of these assets, by the way, memes have way more liquidity than like the majors. It's, it's incredible.

Yeah.

Now you, you haircut that by 50, 60%, it's still a ton of liquidity to get out. NFTs. Yeah, no, you, it's just structurally very difficult to get out.

Yeah. Um, all right, we can wrap with, um, there's like 2 or 3 things. There's, um, Bitcoin Strategic Reserve is, uh, I just want to call it out, it is trading at 32% right now in Polymarket. That is the United States buying a, you know, creating a Bitcoin strategic reserve. There's, uh, news that just broke while we were on this, which is that, um The state of Pennsylvania— the Pennsylvania House of Representatives just introduced a bill that would enable the state to hold Bitcoin as a reserve asset. I would just say this is currently the most interesting market on Polymarket is now, will Trump create a Bitcoin strategic reserve? That is the market people should be watching. The other thing that happened was shout out to Shane, the founder of Polymarket. The feds broke into his apartment at 6 a.m. and kind of raided his apartment and looked at his phone and just, yeah, shout out to Shane. He posted a legendary tweet that I think will go down as one of the greats. He tweeted out, new phone, who dis? Right after the, you know, at 4 o'clock in the afternoon. But then he said a more serious thing. He said, it's discouraging that the current administration would seek a last-ditch effort to go after companies they deemed to be associated with political opponents, etc., etc. I'm also proud to say that the future of America, and in particular American entrepreneurship, has never been brighter. In the face of adversity, we build. So yeah, the, the feds broke into Shane's apartment in New York and, uh, yeah, went through his phone and took his phone and stuff like that. And, um, Jesse, uh, from Kraken, who also was subject to a raid, had a pretty damn just retweet about it, which I, I quote, I said, having gone through, I said, it's insane that some of the best founders of our time are accustomed to FBI raids. Uh, Jesse said, having gone through this, number one, counsel is probably going to advise to stay quiet. Shane's already broken that, obviously. Two, search warrant would have been provided with some crime statute cited, with some crime statute cited. Three, they claim evidence of any crime could exist on any electronic device. This is the crazy one. So they take every electronic device. They can hold them for up to 5 years without charges. Obviously, this is insanely abusive in an era where everything is digital. 4, we won't know what they told the court affidavit to get the search warrant approved until much later, if ever. And 5, we won't know if they have other secret FISA warrants to monitor his online accounts and people around him. So just to, just to, you know, I'm, I, I think the reason they did this is because They are accusing him of letting US users use Polymarket, and that's a big crime, you know, if so. But what I would say to that is, why are you going after this, you know, 27-year-old founder who's decided to— he could have moved to Dubai, he could have moved to the UAE, he could have moved to Singapore. He has decided to still build his company in, you know, out of SoHo in New York, which is the, the literal worst place to build a crypto company in the world right now because of not only the US, but because of the BitLicense. Which is still ongoing, by the way, which no one talks about the BitLicense anymore, but it's also criminal. And yeah, he's decided to stay in New York City. You could go after the myriad of shady Asian exchanges that let US users walk into them and build accounts, and you decide to go after Polymarket. Like, it's a, it's a shame that these great founders are having the FBI raid their homes.

What's the harm done? I don't understand what was the harm done. I think I always go back to the interpretation of law. It should always be, again, when you're restricting users from claiming an airdrop, accessing Polymarket, what is the actual harm that you've done to users? And that should always be the guiding principle as we think about our administration, where we can probably get some more rulemaking in place. That should be, I think, the North Star. For any policymaking. But what do I know about politics? Nonetheless, um, um, yeah, it'd be interesting. I, I, um, on this point just alone, uh, I think, uh, like, maybe I'll reserve for another time. We can cut this part off.

Last but not least, Do we want to talk? I tweeted this big thing about the stages. You tweeted we're in the everything cycle. Also, um, let me pull up your tweet. So I, I sent out this big tweet that I will spare people the, uh, the pain of going through this long thread live on a podcast, but, um, you should— it's just, it's my pinned tweet if you want to go look at it. I said there's 4 phases of bull market. We just entered the most fun phase. Welcome to stage 3. I won't read this whole thread. The thing that I just want to drill into is I'd say we've got about 6 months here of what I'd call stage 3. And it is a really, really, really fun time because people are— it's really just the industry is making money. It's not like all the outsiders haven't really come in yet and you're not getting a bunch of grifters and shady people and celebrities and like non-serious actors. And by the way, this, this—

I mean, there's plenty of grifting still. There's always been grifting, but there's always been grifting.

But like, it just, it's a really fun time in the industry. And I would just, you know, take— remind people to take a second to, you know, at the end of the day, go for a walk or make sure you go to the gym and just reflect on like how crazy it is to be working in this industry at this point in time. Because at some point this industry is going to get so insane in 2025 that it'll get not fun. And you'll say, who are all these outsiders making all the— like, doing— like, this is clear grifting. And it's just going to— it's just going to get not fun. And I just promise you that. And that's what I would categorize as stage 4. And so stage 3, in my opinion, is, is the most fun time in the industry. It's when all the people who you just like slog through the bear market of the last— I mean, the prices topped out 3 years ago. People think back to 2 years ago, FTX. But prices topped out 3 years ago and we've been logging it for 3 years. And, you know, all your, all your crypto homies are making money and everyone's winning right now. Like, it's just a good feeling. So just take a second to reflect on it and we can, we can link the thread. So, but you had a good, you had a good post, which was we're entering the anything is impossible phase of the cycle. It can be easy to lose sight of the most important things. And do you want to maybe walk through some of these? I'd love to hear your take on this.

Yeah, it's the anything possible phase and it goes back to what we were saying earlier. One, believe. Believe what is possible in a new regime. You got to— I would characterize it as shake off the cynicism calluses but not the skepticism scars. Again, very two different concepts here. Always be skeptical but not cynical. Of this technology, of what crypto can really do. Remind yourself of what drew you into the space and go back and revisit some of the core principles. And for me, it's been illuminating to go through now looking at traditional businesses, looking at systems, and understanding just how much friction exists. And to me, it's, it's just a very good reminder. I'm excited as ever because you truly see how crypto will transform these businesses and, and the industry writ large. And That's incredibly exciting. So go back and remind yourself of that, but be skeptical. I think in this time, you have to kind of maniacally process new information. The election, if you didn't process that, ask yourself why. And then you re-underwrite your thesis very often with new information because information always is changing, but like don't lose sight of that. And if things are working, update the target. Like I remember investing in Aave like at sub-$10 million. And then they got TVL and it kept growing and growing and growing during DeFi summer. And you're like, again, the brain's not programmed to think in exponential terms, but you have to re-underwrite the thesis then and there. DeFi is working, so you re-underwrite, right? And how big can this get? It's not $100 million, right? That was the target for me initially. It's like, oh, can it get to Compound's valuation in the private markets? $100 million, that's a 10x or more than the 10x. Well, no, it could be a billion dollar asset or maybe more. So re-underwrite. Like, how big can this get? If memes work, how big can they get? Bitcoin, how big can— is it what Bernstein is saying at $500K? Is it $1 million? Is it $150K? Is it back to $50K? Think about those probabilities. Update your targets. And I think in this stage of the bull market and just ever, you want to be back in the fastest horse, so don't be afraid to jump. That doesn't necessarily mean something you said earlier. You don't have to make necessarily drastic changes in your portfolio. Be mindful and wary of overtrading. It has tax implications depending on the jurisdiction you're in. But also, it has a cognitive load of anytime you add a new asset in your portfolio, that's less resources you're going to dedicate to your children, so to speak. So you have to have that bandwidth of be mindful of that. Sometimes it's just backing, doubling down on the fastest horse that you already own in your book. But there's this natural tendency and preference in venture as it is in hedge funds to add a new position because people are making money on other things. There's millions of things in this industry. People are going to make money on so many other things or lose money. You don't have to chase them all. And I think the path towards underperformance is trying to catch them all. Stay in your lane, focus on your process. And again, the thing that I'll caution the most is people do really dumb shit when other people are making money and they think that they're not making as much. It's always a relative. It's always my neighbor's making more money than I am, and it just is the path to financial ruin. Envy is a very dangerous force. Be mindful, cherish the success of others. It's a win-win, right? This industry is going to grow, right? If this industry goes from $2, $3 trillion to $10+ in this cycle, possible, you best believe that no matter what asset you have, if it's something of quality, you're going to be okay.

Yeah.

So just focus on that. Don't do dumb shit. Don't over-lever. Don't over-trade. Focus. Time is the most valuable resource. Own your time. And if you can change your life, change your life honestly and do good. I've never regretted taking profits. I've never regretted spending the people that I love and doing some cool experiences. And I'm still very, very long and very exposed to this industry.

That's a good point. I sold some crypto last cycle to do two things. One is help pay for pay for my wedding, and 2 was, um, yeah, and 2 is to buy a house. And I have, you know, Bitcoin's at $90K. I'll be up, what, 3x or 4x, 2x or whatever. I don't even know. I don't even remember the price. I don't even think about that. And so just, uh, just a good reminder too.

Um, yeah, by the way, ask yourself, like, yeah, maybe you're at a number right now and then you 10x that. Are you going to really change your life? What's it going to change? Like, what gives you meaning? I guarantee you it's not going to be having another million or 10 or 100.

It won't.

Marginally.

There's actually a thing that, yeah, my dad said, which is he's like, what would you do if you, you know, had, you know, like, this was, this was at the, when the last cycle was starting. I was like, I'd probably get like, I don't know, massage every month or something, or maybe I'd get like a personal trainer. He's like, he's like, he's like, hey idiot, you can do those things right now today.

Exactly.

He's like, a personal trainer is $120 a week for to have them come once a week. I was like, you could do that. I know, but it's the thing that like, you know, you do if you have He's like, hey idiot, that is that. If that's the thing that you're telling me, go do that right now.

It's, yeah, it's always your parents that drop these truth bombs on you, but it's so right. You can probably change your life today, you just don't know it. And the thing for me, like, that I just woke up one day and I had candidly been feeling this desire to do something more and more meaningful. Yes, we do the podcast, gives me a tremendous amount of meaning and fulfillment when I talk to people, and especially now that we have the Telegram group, it's so nice. It honestly is the thing that it's not to say that doing a great investment in a 10x or 100x on the venture side is amazing. It feels good to be right in the validation, but the thing that I remember the most is specific people coming to me and saying, hey, I listened to your episode 2 years ago. I've been listening to Empire for so long. Thank you. And I love that. That's what I remember the most. And honestly, And of course people might say, oh, because you're in a privileged position, so nice to be where you are, you already made it. I'm like, yeah, I won't lie to you, get to that fucking number as quickly as possible, but just be mindful that it's very marginal at that point. And I just woke up one day and said I would not be able to live with myself if I didn't start something new, which is I'm building now and I'm working harder than ever. I mean, just look at my schedule. I got to drop now because I have 10 calls back to back. So I'm working.

Awesome, man. Well, hope these calls go well today. I just realized I'm talking about this Bitcoin Strategic Reserve on Fox Business, so I need to figure out what I—

Yeah, you got to put makeup on or something.

Yeah, I'm looking a little shiny here. Yeah.

All right, so good luck. Make us proud. Okay. Thanks everyone for listening. Join the Telegram group. We might be doing some events coming up in the greatest city in the world. Let's go.

Cool.

Thanks for listening.

Hey everyone, thanks for watching today's episode. Just wanted to quickly thank today's title sponsor, SKALE. SKALE really is one of the best chain experiences out there today, and I've used so many different chains. There's a reason they are gaining so much adoption in both gaming and AI use cases. Hit the link in the show notes to explore the SKALE ecosystem.