Hivemind: Can Crypto Bounce, Monad's ICO & The Perp Opportunity

Nothing said on The Hive Mind is a recommendation to buy or sell securities or tokens. This podcast is strictly for informational purposes only, and any views expressed by anyone on the show are solely our own opinions, not financial advice.

Hello everyone and welcome back to another episode of The Hive Mind podcast. Today we have a bit of a different crew. We've got myself, Seteris, head of research at Delphi. We got Jason Yanowitz coming back, head of markets. We got LTR making another appearance on the show on the markets team at Delphi. And then we've got Flip making his second appearance on the podcast on the DeFi team at Delphi. So this is a purely Delphi research Hivemind. I don't think we've had an all-research Hivemind before, so that's good. So yeah, we got, uh, I don't know, it's been kind of like a weird market. It seems like there's not a ton to talk about, but there have been these a few things that have been happening here or there. I guess we'll start just with like overall market sentiment. It's, uh, Wednesday the 19th, 10:30, just after 10:30 in the morning. Bitcoin is— I mean, it was looking okay this morning and now it's back under $91K. Everything is dumping again. So yeah, Jason Yanowitz, what's, uh, how's the market been? Uh, what's the vibe?

Uh, I mean, it's red again for every day at this point for seemingly the last, like, what, week or two? I guess we've had a couple days that were like flat. In like mixed in there, but it's mostly just straight down. We've kind of just gone straight down at this point from like, um, like the top of the range to the bottom of the range, like $90, $89K, right? Um, that's kind of like the range that was carved out in December before the tariff tantrums blew up the market. And then, um, kind of back there again, right? Time's a flat circle. Uh, so yeah, I don't know, market's kind of like, obviously like there's just no, there's just no spot bid, right? Like clearly TradFi is, is is bouncing nicely today. Um, obviously there's still— it's still, it's still weak, but like, it's, it's, it's, it's bouncing and putting in like at least like a sustained rally so far today. And then Bitcoin is just like, the first time you get like one like sell candle in, in equities, you just like immediately puke in, in crypto. So you pretty much are just tracking to the downside and barely tracking to the upside. So it's just like it's just dog shit. Like, there's no— like, pardon my language, but it's just like the market is just like not rewarding holding. Um, it's not rewarding any— like, any areas that like you would expect to see reactions, you're just like not really seeing anything. Um, so yeah, it's just like in terms of risk appetite and, and behavior in crypto, it's just like there's not much to get excited about. And then, I don't know, you like compound it, it's just like, um It's just like, yeah, it's just like you don't— I think the, the big thing is like you, we're just like not tracking with equities to the upside, right? We're effectively decorrelated to the upside and perfectly correlated, uh, to the downside. So it's just like, for me, I'm just kind of like waiting to see like when there is like some kind of, um, sustained appetite to bid risk because clearly It is not here at the moment.

It almost seems like, like Bitcoin has become like a Trump approval rating trade. Like Trump approval has been like nuking Bitcoin nukes, and then like when Trump's viewed as like positive or viewed as doing good things, it almost seems like that's when Bitcoin pumps. So I don't really like how correlated it's, it's been to like the Trump trade, quote unquote. Um, and that's been kind of interesting to see. That being said, this is a much more global asset, so But, uh, yeah, to your point, like, if, if, you know, it's very good that Gemini 3 was, was very good, and it's good that Nvidia— well, I guess earnings aren't out yet, but like, they'll probably hit. And like, because I think, like, to your point, if equities did like actually nuke—

I— yeah, like, equities are just at all-time highs pretty much, you know. They're down a little bit right now, but like, they're really close to all-time highs.

And if they were to actually like pull back a little bit Yeah, I mean, like when, uh, when, what was it, the tariffs or Iran dropped and then equities actually nuked, we literally just like went to like 70K or something. So I could imagine it being much worse this time around.

But yeah, I think the, I think the PTSD for people is that this is exactly what it was at the end of, of '21, is that, uh, I remember like crypto had sold off, was selling off a lot, and I remember all these tweets from people being like, equities are still at all-time highs, like there's no reason to panic. And, uh, it was really just crypto being first, right? So that doesn't mean that the exact same is going to happen this time, but it's definitely something that, uh, is like getting in, in people's heads a bit.

Um, but I kind of want to go back to LTR's point. Is, is, is Bitcoin still a Trump trade? Like, I mean, you, you had Trump and Xi essentially shake hands and markets literally went down. Like, Bitcoin went down. Like, so I don't know, I don't know if Bitcoin still is the Trump trade.

Like, I meant like approval ratings.

Like, oh, approval ratings.

Yeah, yeah, it's a Trump approval rating trade. Like, when, when approval ratings were like really positive on Trump and on the rise, and like people were like, oh, tariffs are actually gonna work, like, I think bounded well. And then like now everyone's calling his bluff consistently, and like I just think there's no, like, yeah, what he says carries less weight now.

Like, we need to see things is what you're saying.

Yeah, I think it's like the boy who cried wolf at this point. Like, nobody takes what he says seriously. And, you know, you get like 40 Bloomberg tweets a day, um, of like his voice or like his excerpts from his speech, and it's just tiring. And I think like, that's just like, people are just fatigued at this point. And so it's like they'd just rather ignore it.

Yeah, I mean, it's crazy because 6 months ago you'd get some notification from the Bloomberg terminal and all of a sudden markets were moving, you know, a standard or two standard deviations. And now it happens and it's just kind of like, yeah, whatever, on to the next thing. What's actually happening in the economy? What's actually happening in markets? Is AI a bubble? What's Bitcoin like? Things like that. Fundamentals now.

Where do you think we're at, Flip?

Uh, I've, I've been, I've been—

yeah, you've been pretty bearish for a while.

Yeah, I've been quite bearish, uh, since the last time I came on. Um, and I kind of hold that, like, I've lightened up on my shorts a little bit here. Um, just given, I think, you know, the, the pullback has, has been quite healthy. And if we continue to go lower, you know, I'm happy being neutral here. Uh, I've got a fair amount of cash, uh, got a lot, a fair amount of stables.

And right, like, that's exactly like my point, right? Like, I, I was talking, I was on that Milk Road podcast, and like, we're down like $3K from where Bitcoin was, but like, right, like, it's like not really much at the grains. It's like, yeah, it's like if you're short from like, you know, if you, if you were, if you were, you know, if you flipped the bias correctly and you, you, you flipped short either, you know, with hedges or just net short or whatever, anywhere in that like range high, like $110 to $115 or some somewhere up there, right?

Yeah, I mean, it was also quite— it was like somewhat obvious too, like after 10:10, like there was something clearly wrong Yeah, you had no, no bid, nothing. And then you were getting good news from the White House and Trump, and markets weren't reacting positively. So like, good news was not equaling upside. So it was like, I feel like it was quite clear. And here, like, we're, you know, yeah.

So if you're just short from up there, the question is, where do you lighten up, right? And like, that's how like I generally try to like look for where I think like bottom positioning should like form. And like, if I was short from $110, which I wasn't, or $115, right, um, I would definitely be taking— and if I didn't already, you know, take, take, take some off at like mid-range at like $100, like, I would definitely be lightening up, if not going relatively full flat. Because if you're not going full flat or lightening up, right, you're like expecting— you have to be expecting more than a couple more thousand dollars of downside. Like, the rate— like it's just not worth holding it for like another $2-3K downside if you're risking like a range low bounce back up to $100K or higher, right?

Like, yeah, it's no longer a fat page, it's no longer easy.

Yeah, it's like, that's kind of like one thing I look at is like an area that like you should start to see something happening if it was going to happen. And if it doesn't happen, like, you'll know, right? So like, I think this is an interesting spot, right? This $88K, $89K, $90K range low area, right? Obviously you can probably puke lower if like you get some liquidation or whatever, but like, I don't know, mid-80s to 90s seems reasonable right now. So I'm just kind of like waiting to see any kind of spot bid return. Like every day it just seemingly like Asia opens and Binance nukes, New York opens and Coinbase nukes. I mean, Coinbase actually has been buying today on the spot side of things, which is Maybe it's a good time to record the pod too, because we've got two big events coming up.

We've got NVIDIA earnings today and then tomorrow, like, NFP got moved up to Thursday and EUR/USD. So, you know, these are, these are the first prints since the government shut down.

So basically whatever we say today will be outdated. Yes.

Yeah. Yeah.

Yeah.

We'll cut it out. Just kidding.

So yeah, I don't know. Market obviously sucks, right? And like the easy trade has obviously been, been shorting and you've been rewarded for it and you know, at this point, like, as objectively as I can say, since I wasn't short, it'd be like, I don't know, the risk-reward isn't, isn't there anymore like it was a week or two ago. So it's like, I don't know, if you haven't already been completely blasted by the market, I think like you might get some relief relatively soon into, into Q4 and stuff, or into Q4, into December.

Imagine you say that Nvidia just misses earnings.

Yeah. And then Nvidia misses earnings and we just—

everyone just gapped down.

Yeah.

And I think, I think an interesting data point about Nvidia Nvidia earnings is, is retail is actually, uh, you know, they haven't just been full throttling Nvidia every earnings over the last 4 quarters. Like, they've, they've been buying when they beat and they've been selling when they miss. So like, we might actually have like a rational market reaction after the bell today, um, just, just to keep in mind is like, okay, yeah, if it, you know, misses are gonna be bearish and, and beats will be bullish, like, it'll be pretty straightforward.

Yeah, definitely.

So yeah, that's pretty much like a, yeah, it's not really a great view of the market is just like, yeah, just not, I think there's just like a weird sense of unease right now.

Like perhaps like not like, like to your point, like I don't, I don't know many people who are like wanting to like short here 'cause they're like very, very directionally bearish. But I think people are just like almost worried or like uneasy about bidding or shorting 'cause it's just like there, there's no clear like path now. You know, even like the Bloomberg podcast is posting like all these, these bubble watch podcasts. I don't know, it's a funny time because like everyone's so worried about the bubble and it feels like we're all highly alerted towards the bubble. So I think there's some like adverse signal there, um, and like perceptive bias where like you're gonna find things that look bubblish even if they aren't there. Um, but yeah, it's just an interesting and like uneasy time in crypto.

I guess the bull case or like comparison would be the equity market in 2019 that went through like this pretty bearish few-month period and everybody thought the big bear was coming and then ended up being okay. I think it was 2019, maybe it was 2018. It was before COVID though. Then obviously COVID kind of changed stuff around there and then that's a, that's a whole history there. But yeah, I don't know. I mean, there's been pockets of stuff. Like Zcash, we can, I mean, we can move on to this. Like, this is such a polarizing topic. It feels like, I really don't know with Zcash. I think there's like a realistic upside case, but at the same time, you know, if the market really does, it seems like a lot of people might be hiding out in Zcash too, because it's been doing so well. And, uh, if the market really does turn, maybe that kind of goes with it.

Uh, it kind of reminds me, funny enough, of like, if you remember pre, like, um, Iran War nuke, everyone was hiding out in HYPE and it was like, I don't know, $45. Um, and everyone got slaughtered because it like dipped down to like $20 again, I think. Um, and that's like what everyone held because it was like what was strong, it was what was like up you know, green every day when everything else was nuking. And so everyone's like, I'm just going to go into this, be saved, and lo and behold, it gets slaughtered. I mean, it's eventually back, so like, obviously, uh, you would have been fine if you held through that, but I don't think a lot of people did. So to your point about like a safe haven asset, like, it does kind of feel like that right now, which, I mean, if we pump and we, we bottom, like, it won't matter. But, uh, if we do nuke, I could see like maybe a delayed, uh, reflexivity to the downside.

I do wonder how exposed it is. I haven't really, um, gone in and seen how much OI and stuff has been built up since it's— it's been like people have started relisting it too, right, over the last like week or two. Um, so I don't know, I, I could see it. Um, it's obviously one of the only coins that isn't completely devoid of a bid, so like that is something. That you have to like keep an eye out for. It's just tough. Like if most— so like the thing is like most people are long biased, right? Most people don't short, most people don't do that stuff. So like when you're looking at assets to buy, right? Like what are you going to buy when the market is like really apathetic at best? And there's just like, obviously people are going to crowd into this. So like it makes sense. And like, Would I, would I personally buy it here? No, but that's because I bought it a bit lower maybe. So like, I don't know, like I think Zcash pro— I don't think the top is in on Zcash, to be honest. I think it probably goes up to like $1,200 or something, um, assuming the market doesn't just like— Nvidia doesn't miss, Bitcoin doesn't drop to $75K, right? Like assuming we avoid like a full-on just 10/10 redo and we just nuke lower across the board, like It seems pretty clear, like, it seems pretty clear to me that Zcash is like where some of the only money that is bidding crypto is right now. Like, hype barely— like, pump is just dead at this point, right? Like, just down only. Like, um, so when there is— like, even in like, you know, bearish market conditions, like, rallies happen. Like, bear market rallies are a thing. Like, you do tend to bounce after drawing down 30% on Bitcoin. Like, it's a very standard thing across like you know, historical samples like 30% drawdowns into, into decent rallies, right? Like it's all very standard. So like if I'm trying to like be open to catching something like that, which most people probably are since they're all long biased, like what are they going to bid when that time comes? To me it seems very obvious that most people are just going to go buy the thing that's recovered well, has shown strength, and will probably break all-time highs. Because I still don't think it's something that's like Um, well, like, it— I think supply is relatively cornered on it. I think there's—

I—

yeah, I don't know, I just think it seems like the only obvious trade if the market bottoms for like a—

I feel like, I feel like the trades I get burned on the most are the ones that I think that like supply is cornered. It's like I'm very like cautious of like doing that, especially with like things like the smaller cap tokens. Anytime I've thought that, you know, supply was— there's always— there's always— exactly, exactly. And then you always see, like, you know, late cycle, you see these pockets that do quite well. Like, you know, Zcash privacy is obviously one now. Hyperliquids held up relatively decent compared to others. And it's like, okay, where are there going to be other pockets? And if so, what are those?

Are they—

are they the, the, the applications with, with buybacks and revenue and, you know, a constant bid? Or is it something completely new like privacy?

Yeah, I mean, I think to Jason's point though, like, if we do bottom, everyone's just gonna plow into Zcash because it's gonna be like the highest beta to the upside. So I could easily see it making like new highs on like a giant spike, honestly. So, um, but, uh, yeah, like, as far as going forward, it does feel like— I don't know, it feels like very much hot potato in the market right now. Like, you're either in those assets that, that like Flip mentioned, those little pockets, or you're just like eating, you know, crap day in and day out, just, just getting whipped. So It's always funny to see.

Yeah, I mean, um, some of these coin prices, man, you compare them to the 10/10 and they're below like wicks now, you know, which makes me cautious bidding like ones that are like haven't filled the wick yet.

Like we love talking about filling the wick to the upside and like these stronger coins that have held up well that haven't filled the way to the downside gives me like, like I'm not ready to jump in. Also, like, if we're in a K-shaped economy, I don't think we get a V-shaped recovery. Like, we, we become accustomed.

Yeah. Like when 10.10 happened, I was saying how, you know, it was definitely painful, but somebody that doesn't trade perps and just holds spot, it's like not terrible. But then basically I've just had to sit through the last 5 weeks of it slowly dripping below those number, those wicks now, you know? And so it's almost worse in a sense where at least 10.10, if you got blown out, you got blown out and you move on. And I'm just sitting here every day, like, just looking at a little bleed, a little bleed.

We had a quick death. You're having a slow bleed.

Yeah. So pick your poison.

Yeah.

I don't know. I mean, there's been some bright spots though. Um, I think, you know, MetaDAO has had their ICOs have been pretty successful so far and we'll see if it keeps up. I think, uh, The, I mean, the, the one that's done best is Avicii, and then, which is like this neobank thing. Um, and then I think yesterday they had one sell out, but I think the, the one yesterday was kind of interesting. I'm not sure if you guys saw this, but Polymarket has been adding these prediction markets for MetaDAO raises. Okay. And so you're basically, there's these prediction markets on what will the total amount of committed capital be on a MetaDAO raise. So the Solomon one was like, I think it was like $12 mil they had committed for a while. And then in the last hour or two, it got up over $100 mil. So then a bunch of these Poly market traders were all pissed and now they're calling MetaDAO a scam because, uh, the, it like cleared that $100 mil threshold at like the last minute. But that, but that's like the, the way these raises kind of, kind of work on MetaDAO. It kind of makes sense that you see these massive numbers because, you know, the team, the team ended up raising $8 mil and there's over $100 mil commitments. So people get like 92% of their money back. I think one of these days on the MetaDAO sales, you're going to see a team take like a lot more in the raise than people maybe expected. And then that'll maybe 10. Temper this kind of activity. Because the way now is like, if somebody wants to get a big allocation, you know, if they think this thing is going to be like 10, 20x oversubscribed, then to get the amount you really want, you kind of need to put in 10, 20x above that. Right. And so it's like a pretty big capital commitment. And then you don't actually know that the final amount that they're going to raise until after the sale. So, you know, one of these days, if you're expecting a team to raise maybe like $5 mil, And then it gets like $75 million commitments and they keep $50 million of it. Then you might see kind of like behavior change here. So I think that'd be kind of interesting. But yeah, I don't know how much like attention you guys have been paying to MetaDAO. I know that a lot of people are kind of skeptical of it working. But from my perspective, it's like the one part of the market that is somewhat interesting these days. Like, they have a lot of legit projects launching there with good kind of like token holder rights, um, and they have some pretty good momentum.

Yeah, I mean, it's always cool seeing like new experiments in crypto, and definitely like MetaDAO has, has seemed the most fresh. Like, it feels more akin to like the cool shit we saw during DeFi Summer and whatnot, back when like people were actually like exploring frontiers of crypto. Um, so I really like it from that aspect just because like it's a breath of fresh air. It's not another perp dex, it's not another, you know, You know, very fun website or whatever. Like we've just seen too much of that. And like, so from that aspect, I think it's really cool. I think it has worked very well for getting money to these teams and it's a great place to raise. That being said, like we mentioned in chats before this, like, you know, startup, startup returns are, you know, they follow a J-curve. So like we won't actually know how well it'll work for like these startups until probably 2 or 3 years out. Um, and like, I think that's worth knowing, obviously from a trade aspect. Like, I did mention on, on a recent like podcast I did that, uh, if we do get like a prolonged bear market, I would be really interested in buying MetaDAO stuff because their, their treasury is like locked away, right? So the team is basically forced to, to continue to build throughout the bear market to see their return on capital. Um, so from that aspect, like, yeah, I mean, if we get a bear market, I'm probably going to be looking to like buying all of that stuff. Um, just because they kind of have to meet their metrics to unlock capital.

I think those performance-based unlocks, like, one of the coolest things that MetaDAO— yeah, definitely, definitely. Like, the linear unlocks that crypto has, like, we've done for the last 5, 6, 7 years, I think are— they've been pretty bad because they, they're not the right incentives. Like, the team, investors, community aren't all aligned. And now what MetaDAO is doing, and there are other teams leaning into this as well, I think is, is very good. And I think LTR makes a good point. Those are the teams in a bear market that you want to be watching. Those are the ones that are going to be super interesting and might have those asymmetric, you know, Solana-like runs when we get back to a full scale.

Yeah, I definitely don't think that MetaDAO is like the right structure for every project, obviously. I do think though that it is a really good way to actually get a community versus like airdrops or other kind of methods. Um, I do think that for MetaDAO to really be deemed a success, I think you need something that launched on MetaDAO to be worth like multiples of MetaDAO itself. Right. I think that's kind of the point. That should be the point of a launchpad is to actually create valuable, um, projects, right. And like valuable tokens. And So yeah, I think I've just been impressed with, you know, these guys have been doing this for basically 2 years now, gone through a bunch of iterations. They moved on from like the pure futarchy and thinking more about like these practical things of basically making ICOs better. I think there's an interesting one coming up that I think Flip is pretty bearish on this idea or sector. But I kind of wanted to talk about just this in general. And it's like this is so it's this PERP aggregator called Ranger Finance. And we don't have to talk about Ranger specifically, but more so just like the idea of PERP aggregators. You know, we've seen aggregators basically show up in like every sector, right? Whenever there's enough, whenever somebody launches some primitive and it's very successful and then a lot of competitors come around and then people are using all these competitors. And as much as we've had perp DEXs in the past, Hyperliquid kind of actually kickstarted this new meta, right? Like, it's, it's funny that like the perp DEX meta is now, while we have had perp DEXs over the last few years, it was like Hyperliquid was the first one that was, I guess, really good and actually started competing in a realistic way with the centralized exchanges, right? And so now you have people doing all these delta-neutral farms on like, you know, they're using Lighter, Paradex, Hyperliquid, Drift, whatever else. So yeah, I think the idea of like a perp aggregator is, you know, you can kind of lower price impact by, I guess, putting this trade on multiple venues. And then your collateral and everything. So there's a few projects coming in this area, perp aggregation. Um, but I think, yeah, I don't know what you guys like, if you guys have strong takes about these.

Yeah, yeah, I like— I don't want to FUD like Ranger or anything like that because I mean that team's OG, they've been around a long time. But I think PerpDex is one of the things like they're gonna do really well, and this is where they'll beat a lot of the centralized exchanges. It's just that they're They're very, they're very composable, and they're able to unify margin in one account. And I think that's one of the big unlocks from Perp DEXs. Like, if Perp DEXs really do become like the Wall Street of the on-chain economy, and in 5 to 10 years, I think you're going to want all your dollars in one spot, and Perp aggregators won't do that. I think one of the superpowers is that all, all the liquidity is already somewhat aggregated and siloed in, you know, 3 to 4 Perp DEXs, these big financial hubs. And if you end up using a PERP aggregator, then all of a sudden the capital efficiencies that you get from portfolio margin are gone. And I think, you know, people, that's not a great user experience because one of the big unlocks is the efficiency in capital. And I like using the example like the portfolio margining. If you're a delta-neutral fund, like a professional hedge fund, like delta-neutral, you know, you make 7% a year and you're doing pretty good. And all of a sudden you get 70, 90% capital efficiencies through, through unified margin portfolio margining. All of a sudden, if you want to be risk-averse, you can take that extra 70-90%, uh, inefficiency gains and just go put it in UST bills, and all of a sudden you're annualizing at 10%. That's a lot of carry, and that's quite meaningful. And so that's, that's one reason I'm not a big fan of PERP aggregators. And then also, PERPs are very different instruments than spot. Aggregators work for spot because spot markets are quite simple instrument, and, and perps are not. And perps vary by venue. So like, if you have 10 assets on hyper-liquid Binance and Paradex, the same 10 assets, the, the way in which they calculate funding and things like that are very different. So even those perps are different. So I'm not, I'm not super optimistic on these perp aggregators. Like, they might be a great trade, and Ranger team has been around for, for quite some time, but long term, I'm, I'm not sure that's sustainable, or the business I want be a part of.

Yeah. What if, um, what if it's like you using it, do you think they're useful for like, okay, maybe you're not going to put on the same long on like 3 different exchanges, but if you're running like these people that are running these delta neutral strategies, you know, is it, do you think it'd be useful just to do that from a Perp aggregator in a sense?

No, I like, I like the trading terminals. I'm a big, I'm a big fan of the trading terminals and you know, I think they've made a great business for them. The first one that comes to mind is TreadFi. David— David's built a great product there, and I, I use it, um, and I think it's, you know, a good product. And I don't think you need an aggregator for that product. Also, a lot of these trading terminals that are coming online remind me a lot of like the meme coin trading terminals. Like, you're starting to see them pop up, starting to get DMs about them and things like that. Um, and so like, it kind of reminds me like peak frothiness.

So what's like the difference with the terminal and the aggregator? The terminal gives you the view of all them, basically.

Yeah, you can—

so like back in the day with Insilico, right, like the first maybe like Perp DEX, you just get your keys. Like you can go to your exchange that you use, all of them— Hyperliquid, Bybit, Binance— like if you KYC, whatever, and you can get it, get a trading key, and you just input that in the terminal and you can basically swap in between them. And so like on Insilico, if you have a Bybit key and an Hyperliquid key, you can see all of the assets across both exchanges and then just like trade on each one and it'll just auto route. Um, and then they also have like, uh, cool, uh, you know, order types that are like specific to Insilico that can then execute on like the, the API key, like Iceberg and, and like tons of cool stuff, like, you know, limit chases or, or swarms that people love. And so I agree with Flip here, like those, those are basically aggregators, like they are.

Yeah.

Um, it, but they're just like better, I think. And it makes more sense.

Yeah. I don't think you're gonna, like the way, like if you were to use Jupyter, like your, your, the, the trade you put on to go, you know, buy Bitcoin or buy Solana or whatever, it go— it might go through 3 different venues. I don't think you'll do that with perps. You go through one, and I think the trading terminals are fantastic products as they stand today.

Yeah, usually like terminals— I mean, like when you go talk to people in TradFi, right, like they have their trading terminals and then they like build out their own infrastructure that will actually manage the risk that they have across the different venues, right? So they can balance all of their different positions, hedge things out. Whatever they're doing, right? And so like, to me it seems like that's probably the route it'll go here, right? Because it seems like it worked there and it, that's how it's done there. And I don't see like, yeah, I don't know why an aggregator would do better than, than that. But, um, I'm curious.

I don't think it'll be able to handle like the risk well.

That's, I, I, I think the main thing, because most, most, most sophisticated shops will build out their own risk engines beyond the terminals to manage the things themselves. So it's like, I don't know what the aggregators would, would do better than the terminals right now. I mean, I, I've used Insilico for years and years and years, and it's, it's fantastic.

Um, yeah, I think to your point, like, I think a lot of the risk that's being managed, I think, is— will be also quite complex. Like, when you've got vaults that have spot perp equities, perp futures, crypto, spot crypto options, binary options and prediction markets. Like, I think, I think that's quite a complex thing to do, and I think a lot of people struggle with that, especially if it's consensus-based instead of something more akin to ZK and Cairo VM. I think, I think they'll really struggle. And so that's why I think specifically the Perp DEXs who leverage some sort of zero-knowledge proofs to help the scaling of the unified margin are probably a little bit better suited, uh, to do this. And manage risk appropriately.

What's the latency on like a perp aggregator? Because obviously like the— in Silica there's not much latency because you're going directly via like API keys, but like I'd imagine an aggregator would probably have more latency for trades.

No, it makes sense. I would assume so. I'm not sure what Ranger is.

Yeah, I'm not sure either, but there's probably different levels of permissions I guess you can give them too.

Yeah, speed bumps.

Yeah. Yeah, right on. Well, yeah, I mean, I guess that makes sense. Um, but there, there are a few perp aggregators coming to market, so I think worth keeping an eye on that sector. I know Paradigm invested in one as well, I saw a few months ago. Um, but yeah, yeah, it's like interesting just with like the purpification of everything.

Uh, yeah, I'm starting to— I'm starting to get DMs about like perps on like Pokémon cards and stuff like that, CS skins. I think that's, you know, I'm not sure like how well those works and specifically like the, like the, the private, private market like perps. Like, I'm not— as it stands today, I'm, I'm happy to be proven wrong. I don't love that idea just because like coming from traditional finance, I know fund managers underwrite individual positions differently than a different fund manager. And, you know, there's not a huge delta there, but there is a delta there. And the delta between those guys and what Bloomberg and these other, you know, news sources will put out, that is, are quite wide. So I'm afraid that you're going to start to see some of these private companies, uh, that have perks. So you're going to see big mark-to-markets, I'm afraid. And this is by no means to FUD them. I'm just like happy to be proven wrong and, and see their methodology. But I'm quite concerned that you'll see a fair amount of mark-to-market there. I don't think you need to purpify everything. I really don't.

Yeah, I would agree. I feel like I'm a bit overboard on that.

Um, well, a lot of them actually like introduce like, so they have like their, their, it's like for the private company stuff, it's like they, they get their actual valuations from whatever's like posted, right? Like, oh, they raised it this and this, but then like in the delta in between those times when they can actually get like valuations, they basically like introduce like a 30-day SMA or something that just like simulates volatility. Um, so then like the perps are more interesting to trade, quote unquote. And so like, I agree with Flip here, it just, it just doesn't make a lot of sense, at least for these like very non-fungible illiquid assets that are mostly traded via OTC or whatever. It's like, uh, you know, you could suddenly have like some standard deviation outlier on a Pokémon card that gets bought for, I don't know, 3x more or whatever, uh, for some asinine reason. And suddenly like the perps will, you know, basically shoot up and then basically get nuked back down and probably just liquidate a ton of people.

So yeah, I'm not even sure who would market make that, like who's providing the liquidity there for something that, that niche. Like, I don't know, I think maybe there's, maybe there's people out there doing it and they're like, there's already a market maker for it and I just don't know about it. But that seems like a lot of risk that market maker would take on.

Yeah, fair enough. Um, Flip, you were in Singapore recently. Yeah, right. Yeah, I think you met with a lot of the perp teams, right?

Yeah, I tried to meet with as many as I could, a few funds, a few market makers and things like that. It was, it was a lot of fun. The energy out there in Singapore, uh, is, is quite good. Um, it's, it really is like this like hole people go into to like just grind for years and like really just lock in. And it was fun being in person with some of these teams. You know, they're, they're all grinding, they're all, they're all in the trenches. Um, got to meet with Bullet, um, and, you know, got to meet with, with Tristan and the crew, and it was, it was fun to see them work. Uh, they're really excited about mainnet. Um, I've always thought those guys were incredibly sharp, so I'm very excited to see mainnet come, you know, hopefully by the end of this year and get to use their product a little bit more, because in testnet there's only so much you can learn. Um, but very excited for what they're doing. And then also, and like, I think they, they really understand, like architecture. Like, they built their, their, uh, their chain really well, I think, and they're gonna be able to scale with unified margin, with transactions and whatnot. So like, I think assuming they can execute and the founders stay on top of— or like, you know, they don't get behind the 8-ball, I think they'll do quite well. And the other team that I spent a lot of time with was Paradex, uh, and I, I've, you know, written a report about Paradex. I follow them quite closely, uh, friends with Anon now and Rob and the team there, and I continue to be impressed there. And it was really telling when I came into the office the first day and worked with them. They, they operate with such urgency and intensity day in, day out, from, you know, 6 AM to 9 PM. They are, they are grinding, and it's very intense. Like, they are all, they're all shipping, they're all locked in, they know what they're doing. Uh, and the team is, you know, very diverse. It feels like a football team was put together. Um, so I, I did enjoy seeing that there weren't many copycats. They're very efficient. Um, so very excited for what they're building, and I think the architecture and microstructure designs that no one wants to talk about because they're quite nerdy and in the weeds. I think the benefits of those are going to really start to come to light, and you're kind of already seeing that a little bit now. Uh, you had Binance announced they're doing RPI orders, uh, yesterday, uh, which is what— which Paradex does, and they've really leaned into. So I'm quite optimistic for that, and I think, um, they're an incredible team that ships at an incredibly high rate, and I'm excited for dated options and multi-leg strats to come to the platform. So very excited for, for what's happening there as well.

Right on. It's interesting that all the perp guys work out of Singapore. Singapore is a weird place to me. It's like, yeah, it's far, kind of like, yeah, but it's like, it's, they have a lot of strict regulation, but then also they don't, you know, it's like, like maybe to build out of it, it's okay, but then you don't want to like maybe use some products out of it. I don't know, it was cool though.

It was fun. Like, the culture there is fun. The team's there, there's a lot of energy. You know, you're in a WeWork, you've got Falcon X, you've got Spartan, you've got Paradex. You pick— like, it was fun. Like, the energy there is good for perps. It was fun. It was, it was, you know, plus EV trip, good to meet these guys, and incredibly excited for the products they have coming. And then, I mean, you had, you had Lydre raise too, which was cool. Um, Lydre just raised from Robinhood. And a bunch of other people. They missed out, they raised $68 million, so $69, but you know, we'll let that slide. Um, but like, that's an interesting product that'll be coming to market, or like, the token will be coming to market soon. Um, and I think, I think it's— yeah, go ahead.

$1.5, right?

Yeah, yeah, which I think was— I thought was quite cheap. So they must be doing— and so like, DeFi Llama just came out, uh, with revenues, uh, for, for LIDR at like $250 million annualized. I think that's quite high. I think that should be cut by at least a half, maybe more. Uh, I've done some estimates and I think their premium flow of volume is a lot closer to like 25-30%. Uh, it might be closer to 40 today just given people are farming premium accounts. So for people who don't know, their premium accounts, accounts that pay for flow and they, they get, you know, latency advantages. And generally speaking, that's user market makers. But recently after 10.10, they increased the points distribution to people who had the premium account. So you've got retail users paying for premium accounts to farm points, um, and that percent of flow I think is much closer to like 20-25%, um, and if that's the case, their revenues are, you know, closer to like $80 to $90 million annualized. So I think, I think, uh, the investors actually probably got quite a good deal on LIDR at $1.5. Like, if I had been offered that, I definitely would have taken it as well. I think there's a good team, and it's clear that Robinhood wants, wants that connection, uh, to, you know, hopefully at some point integrate LIDR into the Robinhood platform.

Yeah, I could see that.

Uh, I think, I think, I think you saw, I mean, you saw Binance really rush to market with Aster too. So I think you're seeing these bigger centralized, uh, parties realizing that they need, they need a, they need a perp arm.

Yeah, yeah. I think like this is actually something we're writing about in our year ahead is like the super app idea. And I think that the super app is going to be from one of these centralized entities, right? So I think like Robinhood is one that could do it. I think Coinbase is one that could do it. I think Twitter X is one, right? Like they have, they don't have the, the finance or like the tradfi or the crypto integrations, but they have arguably the hardest one to get, which is the large social network. Right. And so I do think that this whole super app idea is coming. And so yeah, Robinhood investing in Lighter makes sense there. If they're going to— I'm assuming that they would probably do something with that with Robinhood. And so yeah, it will be interesting to see kind of like how, how we go here with these more centralized entities. Coming in and how they kind of navigate, uh, crypto. I think, um, a few other things like, um, Monad is doing their raise now. They're going next week. Seems like they haven't tapped out demand yet on Coinbase. I'm not sure if that's like all just Monad specific or just people just like don't have money, right?

Uh, I think it's also because of the, the, the way the sales set up with like the, the lowest contributions get like priority to the most amount. And so like it's kind of discouraging like the power law, um, funders to like full send, you know, like we saw with like MegaETH, we saw it with Plasma. Like a lot of these sales end up being just like a gas war to who can send 50 mil or whatever with whales. Um, And so like, I do kind of like the monad system where, yeah, maybe they don't fill their entire ICO, but like Kean came out and said like that they're basically— their goal is to achieve widest distribution. So I think it's like an interesting experiment at the very least. Like if you do reward, um, the lowest contributors with like the most tokens, um, could be kind of interesting.

I didn't realize that. What do you mean the most tokens though? Just like they get the allocation that they ask for?

Flip or someone might know better than me because I didn't look into it too deeply, but So the way the sale works is like it prioritizes distribution over money as far as capital commitments per person. And so this is me off the top of my head. I think the mechanism works like they're basically trying to give people who give $1K to $10K allocation first. Basically it's giving them the allocation first. I don't think they get more per dollar per se, but like it's incentivizing—

like, yeah, the price is fixed, so it's just like they get filled. That is interesting. So they're prioritizing giving it to more people. But yeah, that does make an interesting game. If like, if you do the full allocation, could you actually get zero because there's so many of these? Smaller ones.

Uh, it's going to be interesting. And there's like the game theory of like getting your, your Coinbase ICO score up. Cause like they mentioned, like you might have less access to next ICOs. Like it's kind of like how Robinhood does their IPOs, right? Like if you just like do an IPO on Robinhood and then like full stack, once it comes out, like you don't get access to IPOs on Robinhood for a bit, I think. So like there is that element to it. So like where it's like a little bit of game theory where maybe you want a good rep score on Coinbase for future Sonar, Echo, or just like Coinbase ICOs in general. Um, but like, I don't know, I'm pretty optimistic to like see both MegaETH and Monad come out because like tech-wise, like they're pretty good chains and like there's some cool app ecosystems on them at least. And so it'll be fun to say the least to have more of like another fast consumer-ish chains launching. So it's going to be fun.

I still don't understand like what's, what's like the pitch for Monad. And that's so one, like I also don't like follow it super closely. Like what's the, what's the thesis there? What's the narrative?

Uh, just that it's, uh, the most performant EVM L1.

General purpose. So they got like an app they're really putting weight behind.

Uh, they have a big lineup of apps. They don't have one that they're like championing. They do. That is one of the critiques I think from people is that they don't, they haven't been picking winners and pushing them. Right. Um, so we'll see. They do have a lot of apps going day one, which I think gives them a pretty good shot. And, uh, yeah, I mean, I think, uh, I'm pretty bullish on that ecosystem developing over time. Uh, I wouldn't be surprised if like there's rollups on Monnet at some point, just because it is a good place to launch rollups because it is performing as like single-slot finality and everything. And that's kind of what you need in a, you know, a layer that's going to facilitate rollups, although that's like nothing to do with their roadmap. That's just something I think you could maybe see one day. And then yeah, MegaETH 2, they're doing their mainnet in December. So we'll see how liquidity kind of gets shifted around all these different venues. Do you think that like, so it seems like throughout the years we always have these long tail things that bring in retail, right? Like Monad and MegaETH launching on their own is not going to change the amount of users in crypto, like everything equal. So you'll kind of just expect liquidity to shift from other areas. But we always have these things like DeFi summer and then NFTs and then meme coins and then perps, you can probably say, that are like net new, bringing new people in. Um, I don't know, what are you guys kind of thinking like this next? And then basically, because like basically once one of these long-tail games gets played out, it's kind of like over, you know, like the DeFi games don't last long anymore. The, the meme coins do not run anymore. NFTs have been in a bear market since 2021, right? Um, it's like once people figure out the game, it's kind of like over and that game is figured out. And so obviously it's hard to predict exactly what the next big retail onboarding event is going to be. My inclination is that like I'm hoping there's some sort of social thing and maybe Monet or Mega Ether, one of these to do it. But I'm curious what you guys think would bring retail in. And I'm not talking about just, you know, do you have, do you have like these Tempos of the world that are going to have people starting to use blockchains in the backend. I mean, like actually bringing net new users.

I mean, I think prediction markets have been that, cause it's like a safer way to grow a smaller stack. Like everyone shouts about liquidity, right? Like, oh, there's not enough liquidity for Power Law users. And while that's true, it also means that they're very friendly to someone with like $200 or $500. They can easily like 2, 3, you know, 5x their stack in relatively quick succession, which is like, it reminds me a lot of how I got my start. Like flipping whitelist NFTs because it was kind of similar. Like, you, you kind of know, like, okay, this is like a safe mint, probably going to make money on this. And like, sure, maybe you weren't like having these huge power law outcomes like you did with meme coins, but it was safer to like grow a small stack, and it felt a little bit less like gambling. So I think like the appeal to prediction markets is definitely there, um, because like there are certain ones that are like, you know, you can basically just put $1,000 into like a 70 percent, 80% market that you know is basically guaranteed to be 100% and just make a quick 20%. Um, that being said, on like the more power law outcome side, yeah, I don't know. Um, I think like the upside of crypto is that it's basically an entirely free market, and as such, like we've seen in the past with NFTs and meme coins, like when there is a lot of profit to be made, more firms enter, you know, classic economics, like, you know, economic profit goes to zero, market becomes too efficient, all the new tools launch, botting, multi-wallets, you know, vamping and stuff, and then like there's no profits to be made anymore. And so whatever the next thing is, I don't know. I think there will be a next thing. I think it's just going to look much different, um, whatever it might be.

Yeah, I, I tend to think, uh, what we've seen, like we had, we had DeFi Summer, we had meme coins, we got prediction markets, perps. I think it's just like the next iteration of those as those products become better, uh, specifically perps, as like the on/off ramps get integrated into the the platforms, as risk and the risk you're taking becomes more understandable and visible, I think that brings on a lot of, a lot of users. Like, from my TradFi background, I've got a fair amount of friends who, who do like Perps, who do like that trading interface, because that's very, uh, you know, what they're used to. But like, they still haven't, they still haven't come on-chain yet. They're still not trading on these platforms yet. And I think as, as the onboarding friction, uh, slowly, slowly goes away over the years, a year, hopefully. I think, I think those bring on a lot more users because that's something people are used to. Um, I mean, it's kind of why people come into crypto in the first place. Like, I remember when I first got into crypto, it was trading Doge on Robinhood. Like, it's the trading aspect, I think, for a lot of people. And as the friction to get onboarded, uh, to these, to these platforms continues to go away, I think we continue— we see a lot of, uh, user growth there.

It's tough, right? Like, I mean I don't think the next massive wave of people coming into crypto are coming in for like financial, like apps, like trading and stuff. I just like, it's super popular for us, right? Because like it's, it's the world we live in. It's like our backgrounds, a lot of us like prior to crypto, like finance, trading, things like that. But like, I don't know, there isn't much of it. Like when I talk to all of my friends who aren't finance people or crypto people, like trading is not something they, they entertain the idea of doing at all. So like, I think it has to like, like a real like driver of like new blood into crypto, I think has to come from something other than trading products. I just don't.

Yeah, that's my thing. It's like one of the, uh, I did this podcast with, uh, Apriori, who's a Noma guy, coming out this week. And like, we talked about all this stuff and the biggest, you know, I guess, issue with crypto historically is that whenever we onboard people, we onboard people as traders. And that's just like not sustainable. It's like not—

yeah, because it's zero-sum, right?

And it's like most people are not traders, man. This is like not— and so that's why, as much as, you know, the, the streaming meta and everything and the content creator coins is— yeah, it— you need gambling for it to all work, for the wheel to run. But the people coming in don't need to actually be doing that gambling themselves, right? And so it's like a baby step on getting somewhere where you can actually have people come in and just earn and not have to become traders. Right. So I do think that that's kind of the, the only way, like we've probably onboarded most of the trader types, you know, in like mid-teens to, you know, mid-thirties at this point. I think if you're in that age group and you haven't come on yet, then you're probably not for like pure trading stuff. And so yeah, you kind of need— and prediction markets is an interesting one, but it's still kind of like, it's still like, you know, gambling in a sense there.

So yeah, I mean, like, um, as like a college student, like, I think fundamentally people don't realize how financial adverse— like, most normies hate finance talk. Like, that's why they have an FA. That's why they have an accountant do everything to do with their money. They have like, you know, Rocket Mortgage. They have auto savings app that auto-direct money because they just hate it. And it's not because like, I don't think— I mean, the lack of financial literacy is there, sure. But it's also like they just don't want to spend the mental acuity or bandwidth on that kind of thing. They'd rather spend on what they actually like doing. And so like, to Sutter's point, I think you do need to like hobbyify it in a sense. Like, and like, I think again, like they try and force trading to be that hobby where it's not. Like most college students at my college, they all play sports, fantasy, fantasy sports, right? Like they all gamble on fantasy sports, low stakes, whatever. But they don't do it to like make more money per se. Like they're not doing it to like try and make it out the hood or whatever, quote unquote, or to like trade or hit that big parlay. Like they literally do it for like social fun. Like, you know, they gather their homies around on a Friday night and then like they're all bet and it's like there's the skin in the game and like it's fun and like that's for sure.

For sure. My fantasy league is year 16 now.

And yeah, exactly.

I give zero shits about winning the money.

Yes.

Like, it's not the money. I don't, I don't care about that.

But like, I think people see like how big FanDuel is or whatever, and then they extrapolate that to mean like all these people are like trying to make a ton of money on these platforms and like are traders. And then they, they put that into the TAM of these like social trading apps or whatever that are inherently very zero-sum and PvP. Um, so yeah, to your point, like I think probably the next thing will probably be more socialified, um, I'd imagine. But like, I think, I think you'll kind of know it when you see it if you've been in crypto long enough. Like, a lot of these trends are very easy to spot, like, culturally.

Yeah, yeah, I agree with that. Um, all right, well, I think that's like all our topics for today. I don't want to run this too long. It's been kind of like, I don't know, the last month or so just feels Uh, it's just such a weird environment. I do think things will eventually turn around and, uh, you know, sometimes people could sometimes lose interest during these dead times, but I always think that these are important times to like keep paying attention so that when things do change, you're like fully, um, engaged and like alert of like what has actually been happening, right? You don't have to play catch up. So, you know, as much as these times can be boring or they suck, I also sometimes see them as like an opportunity, um, to like set yourself up better when things come back.

LTI— LTR and I were chatting about this yesterday. The best part about bear markets and why we like bear markets is it's so much easier to find teams who are actually building and grinding in the trenches, and you don't get distracted.

Yeah, you, you had— you have way more time to like do stuff. You don't feel— you don't feel rushed.

I always bring up like, man, like I bring up this to Flip in this exact conversation, like Pendle and Maple, like two like DeFi blue chips now were at like zero post-FTX and like their teams were just like grinding through that bear market or like Virtuuls was like a gaming DAO and they pivoted to be, and now they're like the, the biggest, you know, crypto ACP, a generic protocol. Like, so I think like it is, it is like really good selection during a bear market. So if you do have that cash and you haven't just been absolutely dog walked in, in spot, then, uh, I think it'll be pretty clear, like, eventually, like, oh, this team has really stuck around, probably a good bid, you know, it's not really going to go down anymore. And that's kind of why, like, I think, like, the MetaDAO Futarki stuff could be interesting during a bear, or just anything that does have, like, a carrot dangled in front of them, so to speak, so that they want to continue to build.

Cash is king, right? I remember, I mean, it was a different environment, but in 2021 I was working at a uh, TradFi shop. And one of my mentors, his name was Scott, and he— his profile name on Slack, he changed it to Cash is King. And it's just like, in, in bear markets and drawdowns, regardless of what the dollar is doing, like, having cash is king. Uh, so always have some cash on the sideline.

Yeah, cash is king, and then cash is trash, and you just go back.

Yeah, it is. It goes through cycles, but right now cash is king.

Uh, well, all right guys, good app. Next week is US Thanksgiving, so all the Americans, happy Thanksgiving. Sure, it'll be a quiet week overall. Make sure that you shill crypto to all your relatives because I think we need all the support we can get.

Everyone should Zcash to their grandma.

Yeah, we really need all the support. Yeah, maybe, yeah, maybe coalesce around a few coins. Don't like, you know, we have too many tokens.

Like, Grandma, you can play bingo privately and you can like Tax evade. It's gonna be so great.

Yeah. Um, but yeah, cool. Thanks for, uh, joining, guys, and we'll see everybody— see everybody again in a couple weeks.

Awesome.

Thanks, guys.