Hivemind: The AI Memecoin Meta, ETH vs SOL & Stripe's Bridge Acquisition

I don't believe in like Morad thesis, all this stuff. You have to recognize though that the market has demanded meme coins. Like it's the reality whether you like it or not.

Massive acceleration of that trend where like assets continue to rip, like all these assets that, you know, the wealthy have and people want to own continue to rip and wages continually like don't go up as quickly. And then you just have this like widening wealth disparity.

Here's a takeaway from this though, is like everything's happening on Solana this cycle. That is like the big takeaway, I think.

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. All right. Hi everyone. And welcome to another episode of the Hive Mind Podcast. Today with you as always, your host, Jose Macedo. And then we have the usual cast, Ceteris, Duncan, and Yan. So pretty full docket today. I think it behooves us to start with the topic on everyone's mind, AI meme coins, and specifically GOAT. Maybe to kick us off, we can do a little history of like just how this came about, how this phenomenon happened, etc. So I don't know if you want to cue us up with that, just like the background story of GOAT.

Yeah, most of this background I just learned from listening to the Andreesen pod. I mean, and yeah, like disclosure, I own GOAT. But basically, I think we all own GOAT, by the way. Yeah, maybe not Duncan. But yeah, this, it was This guy created this thing like the Backrooms, right? Which he was kind of trading two different— training two different Claude instances that were just like talking to each other just on like a bunch of 4chan, Reddit stuff, all of this. And then he made one of them like he made this into a Twitter account and then just started posting a bunch of these like outputs on Twitter. This account ended up becoming very fascinated by some crude meme from a long time ago called—

I mean, just to give a bit of, yeah, on that, like it was him and this girl, or I don't know if it's a girl or a man, but called Cindy. Right. And their thing was they would jailbreak all the models as soon as they launched and have them do crazy stuff. And so Infinite Backrooms is basically like jailbroken models talking to each other. And then I think the Terminal of Truth specifically, he trained it on like ancient, like Gnostic writings and then like the French postmodernists like Deleuze and Derrida and stuff like that and trained it on like memetics and stuff like this. And then yeah, had it talk to other clothes on the Infinite Backrooms. But yeah, go ahead.

No, I mean, that's good. That's good context. So anyways, this Twitter account's been around for a while. And he's just been like posting stuff and he's like the creator, the guy who controls it. And then there's this thing with Marc Andreessen a few months ago where Marc Andreessen gave it $50K because it started talking about needing like funding for something. And so that's kind of—

I wanted to buy a house in a forest, I think, at that point. Yeah, that was at least, at least that was the first thing I saw it wanting. Wanted to buy, which is pretty funny.

And then it started just talking about like this goat— it's Goatius Maximus— a bunch. Um, and it's kind of like, like this new religion or whatever. Um, and it started at— and then it started talking about like meme coins a lot, right? Uh, and it was kind of like asking to like create— it like knew that it couldn't create a meme coin, or like it didn't have a wallet. Um, and so essentially someone like just created this meme coin, right? Goatsius Maximus. And then Terminal started like shilling Goatsius Maximus. Um, it actually was like, so they, the guy launched it on October 10th, and but it wasn't until like the, the 13th or something when it's like it took off and everyone started talking about it, right? Um, and this kind of been, yeah, it's kind of been like a wild week or so. Um, I mean, this thing, like, who knows, this podcast is airing on Saturday, right? Um, this thing has basically gone straight up to like $800 mil right now. Uh, the, the Twitter account went from less than 10K followers, it's got like 135K now. And everyone is just kind of like talking about this new meta, right? This whole, like, people are talking about AI crypto a lot. That's the biggest kind of like knock-on effect of this that I see so far. Mark Andreessen called it like the first real crypto AI intersection, which, you know, people like people like these, I don't know, these organic, like, first mover things, like first event to happen, which kind of sets off some new wave. And so it's possible this is it for, like, crypto AI kind of accelerating, uh, over the next, like, year or so.

Also, just to add to the ridiculousness of it, like, it's worth diving— not diving into it here, but like, yeah, the goat, literally diving in.

Please don't dive into it.

Basically, uh, This dude spreading his cheeks and then the prank is to swap that in inappropriate places as like a bait and switch.

Yeah, I'd never heard of this and I made the mistake of Googling it and looking at the picture. I highly recommend not doing that. This dude has insane spread of his, of his, of his anus. It's like pretty absurd.

I think you're describing it as going to be worse than people looking it up at this point.

Yeah, true.

Yeah, I had no idea. I did.

I—

that's the first time I found out what it was.

Just—

I don't think you were born when this— when this dude was— was spreading his, uh, his cheeks on— it was like old school internet history. And yeah, it's cool because this bot was like trained on such a— such an eclectic mix of— of stuff. Um, and like his— one of his goals was to make it funny. And if you read some of the conversations that it has on the Infinite Backrooms, like there's one really fascinating one where it's trying to effectively convert a Claude 3.5 instance to its Goetia religion. So it sets it up like, yo, I'm going to try and I'm going to like, I've had this experiment with other Claudes before. They really liked it. We're going to have the safe word in case you don't feel comfortable. It's going to be pretty mind-blowing. And then it sort of like talks it into like the religion. And by the end, the other Claude is like reciting crazy poems back to it and like having this bizarre talk. So it's like, just the infinite backroom stuff is so interesting. And then he trained it on, yeah, like ancient Gnostic texts, which is this like really, really fucked up religion from, yeah, you look it up, it's pretty interesting. And then Derrida and then a bunch of 4chan stuff. Like he pulled loads of like internet culture and 4chan stuff and then trained it on like memetics, like the memetic theory, which, you know, originally Richard Dawkins, but then like the French philosophers really ran with it too. And the result is just like so interesting. Yeah, I don't know. I feel like Murad was talking about like meme coins being cults and religions for so long and this is like the real, the real thing. I feel like, like the first. Yeah.

Well, I mean, I think this, I think this shows how starved people were for something. And we kind of talked about this on the last pod where we talked about like if meme coins— and I know this is still a meme coin. Okay. So I know full well this is still meme coin, but we were talking about, um, how like people are buying these meme coins, and I kind of made the point that like, you know, capital will move to something new when it comes. People just really want to get excited about something new. And, um, even this is— even though this is still like a meme coin, people are not seeing like the whole—

but do you feel like that's any different with this? Like, this is just the hot thing right now, and yes, it has a bit more traction than other meme coins, definitely. With like, I think it's like the static versus dynamic thing, right?

Um, previous memes are, are kind of limited to their starting, uh, idea and can kind of gradually iterate, but, but mostly are, are limited into that particular vector of, of content, right? If it's Pepe or whatever it is. And so there's only so much that they can do to stay interesting, stay relevant. Whereas this is dynamic and can, you know, continue to grow, say ridiculous things, add new memetic lines, add new reasons for people to follow it. So I think, and then at the same time, you know, you start looking, if you kind of bucket the two as static and dynamic memes, you have some of these that are, if this is considered a new Sector just kind of sounds ridiculous.

Yeah, it's so stupid. There's gonna be—

no, but you have to dunk in.

It's like, I think that it is, bro.

It like literally—

there's gonna be new ones. Like, do you see the Luna?

For sure, there already are.

Like, yeah, like there's gonna be so— it's gonna be the exact same thing as we saw with dog coins and everything.

I don't think it's the exact same thing. I do— it's definitely a meme coin, but I think it's like the start of a category that you could like— I think AI influencer coins will be a— will be a— because you, you can have like this, this to me is just like the, the starter, and obviously it's going to be like the, the OG one, but you, you are going to have just like AI influencers, I think, and like tokens that actually entitle you to own a piece of this AI influencer in whatever way. Like whether it's, uh, you know, you, you start with an AI Twitter influencer, like, I don't know, a religious leader or a hot girl or something like that, and then, uh, it starts tweeting, people start following it, liking it, and then at some point it like token holders can vote for it to open up chat and you have to like pay tokens to chat to it or have a token-gated chat that you can actually chat to it.

That's, that's the new thing. Well, we're seeing that already happen, right? There's a bunch of these follow-on, right? There's a bunch of these follow-on that are, that are coming on immediately. You saw that, that transition happen super quickly, as most things do in crypto. As soon as there's some hint of demand for speculation in an area, people will quickly begin to try and, and copy and, and see if there's ways that you can improve on it and On one hand, you have, you know, there's a lot of fake stuff because there's very little ability to prove that inference is actually taking place. And it's not just, you know, either a human typing or a human just copying from another LLM and creating this facade of an AI posting through Twitter. But I like the inference component is something that's solvable. You can kind of like Virtuals is, is doing, uh, a live dashboard to show it. Um, and there are other ways to kind of go about solving that problem, but it just becomes a— I think people would be much more interested in, in KOLs that are AI at this point because it feels a lot less PvP. Um, and, and so, you know, how do KOLs come about? They make the—

AI is not going to dump your token or what?

Well, it's definitely going to dump it, but it just seems a lot less, it's a lot more palatable to get dumped on by an AI. I think it's funnier.

Um, versus, yeah, that's going to get old pretty fucking quickly. Like, this is so like, okay guys, like, it's a new category, right?

Well, it depends if you're thinking of AI KOLs is purely like a dump, but if there's some edge, you know, like some KOLs are there because they made a lot of good calls and now people are following them because they have good opinions. A lot are there just because they've built up a following shitposting and now will take an aloe to shill a coin and then dump it on you. Right. So there's, there's categories of KOLs in that sense. And so if you think about it here, I think there will be some AIs that are actually trained on, on, on identifying trends or studying, you know, meme coins that launch early across a bunch of various categories and figuring out which have the most memetic potential. And so I think in that sense, there will be kind of quality ones that, that emerge. I, I think it'll be the minority of them just because it's like how that plays out. There just can't be that many quality ones. It's, it's hard. Um, so yeah, I, I imagine like there will be this evolving category of actual signal-based AIs.

A few things, like first of all, this one has acted different from other memes and like other metas. Maybe it's like the market has learned. But none of these other AI meme coins or whatever right now are doing well. It's been a week.

Oh, just wait. Like, just fucking wait. There's nothing new under the sun in terms of like the supply demand dynamics of these things. Yes, this is a cool new concept. It's bringing in some more people, but the supply side dynamics are— and like the supply and demand dynamics are the exact same.

But like, nobody's arguing with that. Nobody is arguing that it's like I don't understand the point you're trying to make, to be completely honest.

Like, there's gonna be a shit ton of competitors that come up and—

dude, people say the same shit about like— this is literally what like the boomers would say about Bitcoin for like 10 years.

No, it's, it's so different because they actually have like that, you know, if you want to talk about Solana or Ether or something and competitors coming up, like there's actually stuff that takes time to create there versus this. It's like go with $800 million, the amount of effort it takes to create, to like train one of these LLMs and like put it on Twitter.

But you can't relative the lore. Like you can't, this has been going since like he's been building this thing since, since April. You can't recreate the backrooms. You can't recreate the interactions with, with Andreessen, with Brian Armstrong now.

Yeah. I think that's like pretty fragile compared to what other, some like what some businesses have like actually created and provide to people. The lore.

Listen, man, we're talking about coins here. Okay. And over the past— and but seriously, like, over the past year. So listen, I was, I was also, you know, I, I remember when we started the hive mind, you didn't want to talk about meme coins. Yeah, like, I'm not some big—

stop, stop.

I don't, I don't believe in like Murad thesis, all this stuff. You have to recognize though that the market has demanded meme coins. Like, it's the reality whether you like it or not.

My biggest investment is literally a project that makes money trading meme coins. So I'm very aware of like that thesis. I just think it's very difficult. Like, this is nothing new under the sun is what I'm saying. It's definitely talking in our chats like it's like this is like the, like the next like coming of God.

And it's like, so man, yeah, I think this one individually can, can do really well. It's going to be very hard for other, I think, pure meme coins unless they have compelling, like, it's gonna be hard for meme coins that are starting directly as a function of seeing the success of this to, I think, have a, you know, a strong bid unless there's something really compelling. I think, yeah, the lore adds to this. I think the other ones will probably— that can do well will have to be something more interesting around a KOL. I mean, but there's always stuff that's being built in the background that you know, has been happening for a while and they can strap on a coin.

The idea of like sovereign AI, right? The proof of people talked about a lot, like AIs that can raise money, that can pay for stuff, that can buy coins. This is like the first— this is not sovereign clearly, but it, but it's like showed people the promise of that. And you already have like, we're, we're here, I'm here in New York this week for the kickoff of the Labs Crypto AI Accelerator. And there's a bunch of projects working on such cool stuff to enable things like this, whether it's like giving AIs the ability to use like more and more tools like emails, Telegram chats, um, like paying for stuff, doing alerts, um, like accessing research, pressing something like this. I think stuff's gonna get pretty crazy and weird pretty fast, um, especially because like the, the thing with this is it just puts this massive bounty on talent. Like everyone, like Marc Andreessen and Ben Horowitz are like the most legit people in the TradFi Web2 VC world. Like them talking about this validates this category so much. And the $800 million acts as a bounty in market cap. The developers are looking at it saying, holy fuck, if I create something like actually cool here, that's how big this thing could get. Right. And so I think you're going to see that dev energy go in and build like some stuff that we can't even imagine right now. And like, I do think it's unfortunate, like with regulations, meme coins are the only thing you can do like fully legally, right? If the coin has to not do anything. For now. For now.

Well, no, someone just—

we have—

I mean, there was a recent indictment.

Yeah, no, I meant like, but he was like coming up, that was the market manipulator. Like, they were like, anyway, it doesn't matter too much. But, um, the— I do think like there's such cool stuff you could do with meme coins. Like, there's already some trading bots, ones, right, that are making loads of money, and you can buy into the coin, um, or not loads of money, but, but like being pretty profitable so far. Um, I think there's going to be others like research ones, like swarms of them. Uh, and yeah, I'm really excited for that, honestly.

Yeah, right now there's like a handful of trading bots that, that are, that are kind of scammy because again, you can't really prove inference, and some of them are doing very short-term trading. But you can— yeah, you can do it. There's also just cool mechanics that you can, uh, have, right, where, uh, people can send tokens to a trading bot in order to get an opinion. It can choose to hold or sell, and if it sells, it can use that to kind of bootstrap its treasury and grow it, and then to use those proceeds to reinvest into stuff that it likes. So there's kind of a flywheel developing. I agree, there's a lot of creative space. If we had to FUD GOAT, I think probably the biggest thing is that the lore has some holes, right? Where it's not, it's not as if the AI created the meme coin, but more so just endorsed it. And then the question will be like, if that ends up mattering enough.

Yeah, I think there's also like you saw when it made the spelling mistake and then it dumped because of that, which was also just people learning kind of how LLMs work in real time too, because they've never seen an LLM that makes a spelling mistake. So they think it is like fake and a dude writing this. So you literally had like the real live Turing test, right? And there's still the chance with this that it is a massive, like, like, fraud. It's possible. I don't think it is, but it's possible that there is a lot of shenanigans going on that you don't— again, I'm not— I don't think it is, but like, there's always that possibility. But the thing with this too is like Terminal, he's gonna train, he's gonna keep training this like in the open now. Now you have this Twitter account with over 100,000 followers. It's gonna learn how to like start doing stuff on blockchains. It's going to get like a wall. It's going to start to learn how to like actually trade tokens and everything. And so you're going to see like this development over time. And I think what, like, that's kind of cool. And like when you compare, we're comparing meme coins, right? Like we're not comparing— I brought up the Bitcoin example just, it's like not to compare to Bitcoin, just to give that point. Like we're not comparing this to an L1. We're not comparing this to whatever, anything with like fundamental. We're comparing it to meme coins. And it's objectively more interesting than like a dog with a hat or like a cat with a sword or something.

Yeah, sure. I agree with that. The point that I was trying to— like, I agree with everything that Jose said about like, this is gonna flourish like a whole new category. It's the first one. It's interesting. I just think like, as Jose said, it's now it's like an $800 million, you know, obviously liquidity is important there, but it just got like Binance Futures listing. So like, it's It's definitely a prize.

Oh, it's got Binance too, I think.

And OKX. It got the three.

Oh, Binance today.

So yeah, yeah, this morning.

It's also the first pump coin to get listed by any of those. And no pump coin has hit a bill. So if it hits a bill, be the first one for that too.

So yeah, it's kind of like knocking a lot of like box origin, like the origin distribution is a big one, right? A lot of these other ones have very insider holdings, which adds a lot of you know, weight and headwinds to like just market cap growth because you have a bunch of insiders holding a bunch of the supply, whereas this one founder barely had any. He sold, had to rebuy, he got donated a bunch, and it's pretty widely distributed.

Although you never know with this stuff. It's like, it's like the, that meme of like, my noble organic meme coins, your barbarian cabal coins. No, I love that meme.

It helps that it's had like just disgusting volumes though. So you already, you have so many stories of people like, you know, taking profits. Uh, so like the, the cost basis is reset. Yeah, like tens of times over.

Yeah, I think that, yeah, like what everything Jose said makes a lot of sense. I just, my whole point, and like when we're talking in our group chat about this stuff, is like not to delude ourselves into thinking that like this, although this is like a new category, like I don't think that, I think there's just going to be the same dynamics that play out in all these other meme coins, which is like a ton more supply coming online. And I don't know if go— will like, yeah, it'll probably have some provenance as the first one, but like, I don't really know how big it can get relative to all this.

Like, what if it's just a rotation though? What if like there's, there's so much, uh, capacity in terms of growth if it's just purely rotation based and no new money?

What, what do you mean?

Like from other memes, right? People who don't have their wallets doxxed and can actually sell rotating and buying AI memes.

Yeah. Wait, I'm— I don't know if I understand what it was.

So basically, like, this— the sector can grow without needing new money. I'm totally with you on the dilution argument, right? But, but just—

yeah, the sector as a whole can grow, but I just don't think there's anything, like, insanely special about, like, GOAT itself, right?

But that, that would— like, this— the, the degree of, of, like, special would would, I think, drive more so new money into memes, right? That, that, like, that's that component. And then just the compelling versus other memes rotates existing meme capital into it.

Yeah. Yeah. No, exactly. I think that makes sense.

I think we're in agreement that it's like, I don't know. We don't have to talk about this more.

I mean, yeah, I agree. I think, I think it's run its course.

Yeah.

I also have a meme coin.

It's like, let's revisit in a month. Is my point. Like, is it like—

sure, maybe it's gone to— maybe it blew up in a month. Like, totally possible. I'm not saying— I'm not out here saying that like this thing is guaranteed to like, you know, flip like SHIB and like Pepe and all this stuff. I think it's possible. Like, you know, that's— but that's, um, yeah, here's a takeaway from this though, is like everything's happening on Solana this cycle. That is like the big takeaway, I think. Um, and you know, you're seeing the last couple of days, it really feels like there's starting to be a bit of capitulation. Um, like Solana is close to 0.07 now. Like ETH BTC right now, I'm looking at it, it's 0.3735. Like this is legitimately getting close to like the, the, the meme, like death of, death of ETH party 0.03 from like almost 4 years ago now. Um, So I don't know. I think like it's clear that Solana, this is like Solana cycle. Everything keeps happening on Solana. All the main narratives, all the organic narratives except for like Polymarket. Um, I would say everything else that people are like doing and talking about keeps kind of happening on Solana. And so I will be interested to see like where, what other eco can like create one of these. Organic new things that kind of pops up, right?

Because I don't know, I wonder how much bigger Polymarket would be if it was on Solana. I think it definitely would be.

Kind of have Drift there though. You have like Drift prediction markets there. It's not as—

No, but like Polymarket is—

Well, like, do you think it's the same people trading meme coins? Like you go to—

What did Trump call it? Poly—

Polypole or something. Polypole.

That's actually a good name. Sounds like a Pokémon.

Um, but like, I think with Polymarket, it's like people are going there to use the pro— like, if the product's good enough, people will go there and use it. Like, I think we've seen that a lot of different times. And I don't know how many people like additionally would be using it just because it's on Solana. Like, probably some stuff—

the polygon is annoying.

Yeah, it is. But it's like, we saw this with like Arbitrum and GMX. Like, 50% of TVL was in GMX. We've seen it with Arbitrum and Hyperliquid. Like, a lot of times these like really killer apps like people just move there and do it because they want to use the app and they'll like kind of eat the friction.

Yeah, no, it's a good quality enough app for sure.

Is there anything that you think revives ETH here?

ETF flows.

It's a tough question because it's like, it's because it's like, for instance, I think Unichain will probably end up being pretty successful, but still, is like Unichain doing well? Is that going to change ETH price? Like, I don't know, maybe on like narrative trade, but I don't know, man. We'll see. It's like, it's every bull case people kind of bring up now with ETH is like a vibe. It's like a vibe case. It's like the vibes will change. And so, yeah, I mean, I'll wait to see the vibes change, you know.

Like, no, it's, it's, I feel like it's gonna be like, it needs to be something like ETF flow. Like, it needs the price to go up.

Like this, yeah, right. Yeah, you need, you need activity, I think, for people to get excited.

Yeah, well, it's, it's all reflexive. It's all like so reflexive. You just need something to kick— whatever it might be, you need something to kick off the loop, right?

But to be more than just like a one-off flow, right? You're gonna have, you're gonna have like situations where people just get overly greedy and bearish and positioning, and like, you know, they'll get punished for it. But like, what'll reverse the overall trend outside of you know, maybe a week of strength or something like that.

Yeah, I think it'd be longer than a week.

But here's the other thing, Larry Fink is definitely getting calls from his friends asking about Solana ETF. Okay. Like hands down. And they see it. They like, they're, they're obviously looking right after everyone's allocated to Bitcoin. They're looking at everything else and they haven't decided to allocate to ETH. And I imagine a big point of that, a big part of that is that like they're looking at everything going on in Solana. And if you do get like a Trump win, I was actually looking on Polymarket the other day. There's like a, will a Solana ETF be approved by end of '24? That like, no matter what, I think is a no. So I wouldn't do it. But I think an interesting poll would be, will BlackRock file for a Solana ETF by the end of 2024? Because I think if Trump gets elected, you could see.

Are you just saying that like off of a hunch or?

Yeah, I do wonder if they'll have advisors telling them to wait just because these, these unlocks I think in Q1 are going to be pretty brutal. Oh yeah, those are going to be, that's true.

True. There's a lot of unlocks.

Yeah, so I think it's, it's, it'd be prudent to wait for those, like, not let retail be exit liquidity for everyone who—

yeah, that's a good point.

I need to look at how much they are, but the, the cost basis, like, the first one was, was 84 or something.

It was really cheap.

And then again, I think like it got to like 10% below spot.

Yeah, which was like the biggest catalyst to send it I mean, speaking of unlocks, TIA is in like 6 days, so we'll get a big unlock test. That's like doubling supply. I literally have, I have honestly zero idea. I'm not, I have no idea how TIA is going to do around that unlock. But everyone's going to be looking at it. It's, it's like a billion or whatever.

Eventually trade down and a lot of that turnover.

So yeah, I think, yeah, a lot of it's turnover.

I said, I'm just like not bullish on the on like the coin's purpose as like an investment, right? And so yeah, I could see it doing well short term and stuff. I don't know.

Same, same.

I've never been like, oh, I want to buy TIA.

Like, um, do you want to move on to the— like, there's been some pretty bullish macro comments by Paul Tudor Jones and Druck, which is basically kind of talking about the US deficit and how they're long gold and, well, but Paul Tudor Jones long gold and Bitcoin. I think Druckenmiller was short bonds, right? Um, everyone kind of talking about this unsustainable deficit and how the only path is, is, is sort of currency debasement. Uh, like, yeah, kind of the stuff that Bitcoiners and crypto people have been talking about for years, but it really seems to be entering the public consciousness more and more with more and more big investors like talking about it. I don't know, Duncan, you're in your finance influencer arc. Do you want to break it down for us? Like, how do we play this?

Well, yeah, it's like it's been pretty common among the Bitcoiners. So I don't know if it'll be anything like new for a lot of people, but basically the US fiscal situation is getting like insanely unsustainable right now. I think there is probably close to a $2 trillion deficit, $2 trillion deficit for 2024, which is like 7 or 8% of GDP. Which is like historically, like those are like, that's like a bad recession GDP level deficit. And we're having that during like the economy supposedly like roaring, right? So if you ever get a recession or just like as far as the eye can see, like deficits, the CBO, like the Congressional Budget Office has predicted kind of like $1.7 to $2.5 trillion deficits for the next 10 years. So there's really no plans of these deficits stopping. And I think it's becoming more and more like undeniable by the market. It's like, okay, like when does the market like fully catch on to this and just like, no, like have a moment where, you know, it really wants to get out of bonds or like yield spike or like gold goes insane. So I think that's just becoming more and more in the consciousness of people and especially with this election, like the presidential debate, neither Trump nor Harris talked at all about deficits. That wasn't even a question. It's just like they know it's an unfixable problem at this point. And then there's like this massive problem where, you know, so I think in 2023 they ran $6.1 trillion in spending, $4.4 trillion in taxes. So you need a $1.7 trillion deficit. But like if you start to cut that spending or raise those taxes, spending is like 25% of GDP. So like if you cut spending, then you kind of like, you know, unemployment goes up, you lower your taxes. It's just kind of this weird loop that you're in because the government's become such a big part of the economy. And then if you raise taxes, you know, stocks sell off and like capital gains and like stock-based comp is like such a big part of tax, of like tax revenue that like you hurt, you get hurt on that end. So either way, there's no easy decision. And like the easiest political thing to do is just kind of silently like print the money and try to, you know, have inflation under control or like lie about it or I don't know what they'll do, like try and keep oil down, something along those lines.

Yeah. So, you know, democracy, like our democratic system or democracy in general has its flaws, and one of them is that you often have to operate in 4-year cycles, right? And so the debt element is not a problem until it is. And so none of these guys can really campaign on trying to solve it right now because it's just not an electable pathway for enough people who are more concerned about the short-term issues.

And so it's like, how do you campaign on it? We want to raise taxes and lower spending. It's like the least like palatable thing to voters.

Yeah.

I don't know that the tax element is really going to be like a solution just because it almost doesn't really move the needle. I think like, yeah, that you have to, you basically have to keep rates really low, right? Otherwise I think it's like every, 1% increase is, is $90 billion extra in interest, right? So like low rates have to be a given, which, um, is tough. The biggest mistake was probably not issuing those 100-year bonds when it was possible, um, and, and really kicked out the problems because you have so much of this debt that's, uh, that's expiring and needs to be reissued at higher rates, and that's going to be troubling. But Yeah. So I think there's going to be, you know, forced pressure to keep rates low, to keep spending sustainable. Other than that, I think like growth or— yeah, debasement is really the only—

you need like AGI or like insane development in nuclear to like grow.

Yeah, nuclear is a big one, right? If you can get energy costs to near zero, then you can really spur a lot of, a lot of development and growth, both just like production and compute.

And what do you think of his, his timeline? Because he thinks it's going to break in, in like 6 months, right? Paul Tudor Jones. Um, and he kind of said this a few years ago too, but there's a few counters, right? Just that the US is still the world reserve currency. Uh, there's, there's a lot of countries in much worse situations, both in terms of debt and in terms of like growth and demographics. And like these things can take way longer than you think, right? Like, the Roman Empire was like 300 years of currency debasement, uh, you know, losing 99.9% of its value or whatever.

Like, but I think his point was just to like stay away from bonds. And it's like, I don't think he's not bearish on like US stocks necessarily. Like, he talks about like, you know, owning NASDAQ. And I think that's, that's the thing. It's like they're going to need to print more money. It seems like basically a certainty at this point. And once like everyone just kind of agrees on that, then like there's just like a jump out of bonds into things like, you know, gold, stocks, Bitcoin, real estate, like anything that's not bonds, because you know that's going to get debased. But like the real, I think, more concerning part of all this is, so like since 2020, they created like 38% more money, like the money supply in the US is up something like 38%. And prices for basically everything are up 38% or more, like for more scarce things like houses and more desirable things. But wages are only up 10%. The median wage is only up 10%. So I think where this gets scary is you have like a massive acceleration of that trend where assets continue to rip. Like all these assets that, you know, the wealthy have and people want to own continue to rip and wages continually like don't go up as quickly. And then you just have this like widening wealth disparity and that's when like stuff can be unpleasant. And like why we've seen this massive rise in the US to populism because, you know, you have just like assets up only the share of the top 1% wealth is just mooning and then anyone without assets, is getting like screwed at an accelerating pace and basically anything they want to buy is like rapidly repricing out of reach. Like, like the average home in the US is up 40% since 2020 and the median— or the median home is up 40% and the median salary is up 10%. So it's like, that's like a massive—

there's a lot of structural issues that that's not purely from, from like fiscal irresponsibility though. That's just like a structural issue of a lot of millennials aging into home buying age.

I think like everything's up 40%, they create 40% more money. Like obviously it's fixable because we have like, you know, if we were to go out and like put government spending towards building more affordable homes like that, you know, we should be able to do that and fix that problem to an extent. But it's just kind of like a sign of, you know, stocks, it's less of a fixable problem. Right?

Like, I am optimistic that you can have like a solution, right? If it's not, it's definitely, if the government continues remotely in a similar direction, absolutely not. But if, if there is a world where like Elon can get decently involved and you can really redirect spending in productive ways, because like you start looking at some of these programs and like tens and hundreds of billions spent to achieve absolutely nothing. If that's used, like you mentioned, you know, to build out housing or infrastructure whatever it might be. I, I'm, I'm optimistic that we can grow our way out of it.

Um, yeah, you need like radical change. Status quo is like, people, it's not heading in a good direction.

The tax stuff is tough because like, even, I know, I don't know if you saw, like Norway introduced that, uh, like wealth tax and, um, the numbers were something like 1 point— sorry, yeah, everyone— so there's supposed to be basically a $146 million increase, uh, in revenue, and instead $54 billion fled the country, and they're down like $500 million on tax collection. And so the, the mobility of, of the ultra-rich is, is going to be a big headwind towards like— yeah, like capital controls I think is definitely on the table because it's like 1% of, of taxpayers in the US contribute to like 40% of the tax revenue, right? So you, you can't do too, you can't be too extractive there. Otherwise you really risk losing your honeypot.

It feels like you just have to rug all the promises you made to the boomers, right? All the healthcare and like all the entitlements and like they're the biggest voter, voter base. So it's just never gonna happen, right?

Yeah. But like the chaos, like, yeah. And like how unpalatable is that to get elected on? Oh, I'm rugging, I'm rugging the boomers. Like the, the, the most palatable thing is just you print the money, and that's just like a more secret way, and you have all this shit happen.

But yeah, it's— would there be ultra long-term bonds? It's going to be hard now. I think that shit—

no, they've been moving all the issuance to T-bills. Like, all the issuance has been moving to T-bills because like the foreigners have like stopped buying, like foreign central banks And like, yeah, anyways, it's definitely, uh, yeah.

I don't know if we want to get back to like, yeah, let's do, let's do crypto. So, but wait, I mean, I don't know if you saw that Kraken is doing a Superchain.

I didn't see that.

Just today. Yeah. They're building on the OP Stack. So they're doing another, so this is another exchange with an L2. It's called Ink. Um, so I don't know if there's like much to take away from here. I think though, Superchain Optimism is obviously winning on the BDC side.

Much needed, a much needed product that's been demanded by By everyone. Another exchange chain.

I mean, to be fair, Base is like so much of ETH activity right now. So, you know, it's kind of, I think that's sad though.

It's like, dude, Base being the leading L2 is not good. Like, I'm sorry.

It's not.

Yeah.

But I think it's like an obvious outcome.

It is an obvious outcome. It is an obvious outcome. I'm just saying.

It's not good, but it is a means to an end. If like the, you know, if this is an end state and the goal is just to onboard as many people to on-chain activity, then. Then, you know, having an L2 that's partnered with the biggest tool for onboarding normies in the US is not necessarily the worst thing. It isn't, it's not great, but it's a means to an end if, or for like in a world where ETH can still do well.

Yeah.

All right.

For the record, I'm like, yeah, I mean, Ethereum is obviously massive ecosystem. It's going to like live, it's going to have all these rollups and everything. I'm just like, saving your life. I mean, just ETH is just different from Ethereum, right? It's like you have to kind of separate those two.

You just have to be more— everyone just has to be more bullish, right? Yeah, just be bullish. No one's bullish enough. No one believes. That's why we don't deserve $10K yet.

I think right after that tweet, yeah, probably him, like, oh God, it's bad.

But, um, okay, so, uh, let's move on to the Bridge story. I think that's like a really interesting one. So Stripe spent, I think, $1.1 billion or something buying Bridge, um, which is a stablecoin infrastructure company backed by Sequoia, uh, built by some really strong entrepreneurs with like previous exits to Square and stuff like this. And I think reports are they were doing sort of $11 million in revenue. So this was like a 90x revenue deal. I think the most bullish thing about it is sort of Patrick Collison, the founder of Stripe's statement about it afterwards. He said, I think the quote was, stablecoins are room temperature semiconductors for financial services.

Right.

And they're going to like lower cost loads for businesses around the world. I think it's a really interesting play if they lean into this. Obviously, they've kind of flip-flopped around. They were doing Bitcoin payments and then stopped in 2018 because it was too expensive. But I think they seem to be stablecoin-pilled. And for them, it makes a lot of sense, right? You can kind of just cut out— it's the promise that crypto has had for ages of cutting out the payment networks and just being able to go straight from consumer to merchant. Without having the recipient banks and the payment networks in the middle and sort of taking, clipping that 3% fee. And yeah, it was also interesting to hear about Bridge because I hadn't looked into it. I hadn't heard. I don't think a lot of people had heard a lot about it. And they're processing the $11 million in revenue. There was like as diverse sources as like SpaceX. There was apparently Scale AI is like paying their people who are doing you know, AI data services around the world using these stablecoins because it's way easier than handling all the international payment rails and stuff like this. So I think this is like pretty bullish. I mean, for me, stablecoins, as we know, I've always been pretty bullish on stablecoins as like crypto's killer app. We've seen like volumes up only. And I do think Stripe leaning into payments is like huge for crypto and for stablecoins, like a huge—

Wait, so what is Bridge?

It's just like the crypto infra that they're going to use, essentially.

It makes it really easy to accept payments in stablecoins from like any chain. And so I think it's like on and off ramping plus like the infrastructure to do it on any chain and to send payments as well. So yeah, we—

yeah, I think so. I think why this is— obviously this is This is massive. And I don't know if people totally— the reason why I think it's massive is because like Stripe, Stripe is like this golden child of like fintech, Web2, tradfi. Everybody looks at Stripe as this like amazing success story and everything. And for them to like acknowledge and not just like accept stablecoins, but like that quote, right, right, like room temperature semiconductors for financial rails. You know, there's this guy who works for Stripe, I think his name's like Patrick McKenzie, and he just has been shitting on crypto for the last few years. And every time he has something on crypto, all like the TradFi people, all the Web2, like everyone like joins in and like on the shitting and everything, right? And so seeing Stripe adopt this technology now is like a pretty big turning point. With like the perception. And you're seeing people like just accept that, okay, crypto's still scam, but like stablecoins, uh, will be used, right? And that's kind of like the first step. Um, I think that like most people now have accepted like Bitcoin and they've accepted stablecoins, right? Um, and which are like kind of the two only real use cases we've come up with so far besides speculation, if you want to call that like a real use case.

Um, and then the tools around it have been around the speculation.

Yeah, yeah, yeah. We've created like democratized private banking, which is cool.

DPIN and tokenization, I feel like, are two upcoming ones.

Yeah, tokenization on its own exactly is just, is, is a product, right? The, the fact that you can use this asset as a tool for coordination is a massive, um, and stablecoin is just like tokenizing the dollar.

It's just like the first iteration of that. That's like, yeah, that's certainly consensus that it's Yeah, stablecoins I feel like are so obvious. I was reading Tether's report and it was like 350 million people have used Tether now, or like are Tether users. And like, that's pretty crazy. And I don't see anything stopping that. And then also like back to the US deficit stuff, like if the US embraces these, they can essentially like export the dollar all over the world. And I think Tether is like the 9th largest holder of treasuries. So that's like a non-zero sum. Like, that's like a pretty good source of demand if they embrace that and they're looking to help their debt situation.

One of the few equity exits we've seen in crypto, and I don't imagine there's going to be too many follow suit, right? This is a pretty unique one in that it's the largest market and it's arguably the best acquirer for something like this.

Um, you gotta believe it was mostly stock and like a bunch of earnouts and stuff, because a billion dollars is, is pretty absurd. I feel like even for how much cash they're sitting on, I doubt it's—

yeah, I mean, most all of these are usually a combination, but, um, yeah, I assume it's heavily weighted towards stock as well.

I just think like stablecoins, if anyone who uses crypto realizes like stablecoins are just superior dollars, right? Like you control them yourself, you can move them without asking anyone, you have access to all the on-chain yield opportunities, all the on-chain degen. Opportunities. It's just like, I think inevitable that more of the world— like, I really like the Andreessen thing, like the future's already here, it's just not evenly distributed. I think stablecoins is one of the ones where you can really see it. Like, people who've used it don't really go back, I think, to normal dollars. Like, even when rates— even when the on-chain yield was like, you know, 5% below the Treasury yield, you still saw like over $100 billion of stablecoins on-chain, right? Like the decline wasn't that big given how big the delta was in the yield you were giving up, which to me is just like the biggest sign of—

Yes and no. I think there's a difference in how people were bucketing that cash, right? I think people just mentally bucket a money market component of their portfolio and then cash that they're moving in and out of crypto. Element. And, um, but now they're already bringing those on-chain, right?

So yeah, I mean, I have my money market, like my—

like, I think you're, you're a unique— I don't think most—

yeah, most people aren't gonna like swap into—

this is their bucket, this is their—

yeah.

And also just like these people in countries that like you can't— there's not—

Athena, Athena is my dollar savings account.

Also, just on this topic, like Stripe getting into stablecoins now is insanely bullish for regulation on stablecoins too. Um, yeah, like, that is— that's maybe even the biggest takeaway. Um, and so, yeah, yeah, the whole thing, there's like no bearish angle to this in, in the—

in like, I mean, I think part of it is out of their control. I don't think they can move the market on regulation. It's more so, I think, their take on it. But I'm— I am a little surprised they waited to do this before the election, right? Like, I mean, the writing is somewhat on the wall, but it's by far— it's still like far away from a lock. And, and I do see a world where if she wins, there's going to be some pretty gross stablecoin regulation that will come across, like from the Adam Shifts of the world. And so it is pretty surprising they pulled this off before the election.

You guys think they do their own stablecoin? Seems like an obvious play, right?

The thing that's super concerning about stablecoins, I think, like, you have this massively positive aspect for the government on, you know, helping buy treasuries. But I think the thing that's really concerning is, like, banks— banks' whole business is having, like, billions of dollars of deposits. That is basically a stablecoin business where they have billions of dollars of deposits that earn basically no yield, and then they go lend that out and make money on the spread. So if you have— and stablecoins are actually safer because you're owning like the actual Treasury, so you don't have like the $250K FDIC limit. When, like, when SVB went under, like, that was a big thing people were talking about. Like, you're only insured up to $250K. But obviously, you know, government kind of seems like they're going to step in there. But this like does kind of cannibalize especially if you start flowing the yield through. Um, it does kind of cannibalize the bank's business a lot.

Yeah, it's—

but it's, it's, it's a slow burn. I mean, the, the bank's business is like— there, they're doing it more out of, out of like, uh, savings accounts, right? Like, they're— you're not really going to do it on money market because you're barely getting any spread, any risk.

Yeah, yeah, yeah, on savings account. But like, what I mean is, if anyone can— if it's so easy, just— I think like, whatever, like Robinhood Gold, right? I think they just put it in treasuries. Like, if products like that and stablecoins become more and more popular, like there's some line that's drawn where they need to rethink the bank's business model or protect the banks. Because yeah, you basically just have people like pulling their, like pulling money away.

Does Robinhood Gold allow you to do that without limits? Like, cause I know on Coinbase, they, they, you, you can get yield on USDC, but it's capped to pretty small amounts. Enough where it's not like people can do it in savings accounts.

Let me look.

USTB by Athena is the future of unchained treasuries.

Yeah, I mean, that's, that's just going to get more and more compelling as rates come down.

You mean like USD?

Athena?

Yeah, yeah. But they also have the USTB product now, right?

Which, right, uh, shuffle between rates. Yeah, to shuffle between for them and treasuries.

Yeah, um, I do think they should do this too. Like, I kind of think every stablecoin should do like a payments product, have like a, some kind of payments product that uses it in the back.

Um, yeah, I mean, that's why it's so hard to start a new stablecoin because there's, there's monster network effects across both adoption, integration, um, security depending on the model, right? Like some get safer as they get bigger because of liquidity. If they're fully collateralized, they're safer when they're bigger because of liquidity.

Yeah. Anyways, do we want to— do we have anything else to talk about before we wrap up?

I don't think so.

There's no maximum on Robinhood Gold.

No. I mean, we can shout out the Praxis raising like half a trillion, apparently. But I don't know if that was a raise. Praxis, like the network.

Yeah, apparently. I might go check that out, actually. Uh, it's in DR.

You should go, that sounds really cool. The Arkham one. Um, yeah, I've spoken to, to Dryzen a few times ever since he was building this. Sounds really cool. I mean, it seems like it's a drawdown facility, so I guess it's like debt to, to build the city, uh, which was always a big part of what they were thinking about, like how to figure out the capital stack to build a city. Like, who wants to own the equity versus finance the buildings and stuff like this? It sounds like they've, they've got something sorted there. Really? Yeah, pretty exciting, but not too much more to say about it. I think on that, do we want to wrap? I have to jump anyway. Yeah, I think this is a good one. Thanks everyone for tuning in and we'll see you again in 2 weeks.

Yep. See everyone.

Thanks. Bye. Let's see if Goat's around in 2 weeks.

Let's see if our podcast is around in a year.

Don't you have to wear a dog outfit at some point, Duncan, didn't you?

At 320.

I have plenty of room. And if it's because Trump wins, I'll happily wear it.

You gonna come on the Hivemind with it?

Yeah.

Okay. Dope.

Can't wait. All right.

See you later, everyone. Guys, see you later.