State of The Market, How to Value Hyperliquid & Tempo Launches Mainnet

Nothing said on Empire is a recommendation to buy or sell any investments or products. This podcast is for informational purposes only, and the views expressed by anyone on the show are solely their opinions, not financial advice, or necessarily the views of Blockworks. Our hosts, guests, and the Blockworks team may hold positions in the companies, funds, or projects discussed. Monitoring the situation, to say the least. Uh, why don't we just start there? Polymarket announced it's opening a bar in New York.

Uh, it's in DC. It's in DC.

Oh, it's in DC. There you go.

I'm going to DC to monitor the situation next time.

So when is, uh, when is it opening, by the way?

I think it's opening either this week or early next week, sometime next week.

Yeah. When I think about all the things that you could use the cash that they've raised, that is probably one of the better things to do. Uh, looks pretty cool. Yeah.

Have you ever been— there was a, um, a bar or like a restaurant in New York City, like in Times Square, called ESPN Zone, which I'm guessing you've never been to, so I don't even know why I asked you that question. You do not look like an ESPN Zone guy to me. But when I was like younger, like the, like the first time I went to, to Times Square, like I went to ESPN Zone and it's like literally like a million just like screens everywhere showing everything and you can drink and eat. And like, this is that for all of, all of Twitter. Uh, and that actually sounds like a lot of fun. So I'm, I'm, I'm in it.

Uh, I thought you were going to say there's a bar, I think in Germany that tracks the price of beer and it's a real time like consumption. And so you could see like how many people are like, if, if a particular pint or craft is getting more traction, like it's basically real time markets. Um, but yeah, I mean, again, like the name of the game here is like customer retention.

And can I just say something to that before you, before you go into that?

Yeah.

There's nothing that highlights the difference between you and I more than I'm like, hey, have you been to ESPN Zone? And you're like, have you been to this esoteric bar in Germany that tracks the price of different beers?

Yeah. Well, Converge on Polymarket, it's, uh, like the reason I bring it up is, um, We got to start with macro. Uh, we are not geopolitical experts, um, but it's pretty, um, I mean, oil is sitting at, uh, on, on, uh, what is it, $116 or $120?

Um, yeah, traded up again this morning.

So try to get in this morning. So yeah, what's a read on macro? What's a house view out there?

I mean, obviously, did you read Balaji's, uh, tweet, uh, yesterday? And, you know, he talked a little bit about the, um you know, what the broader macroeconomic effect might be of this war. Clearly the market has been trying to digest what has happened, and I think originally when the war started there was a perspective that, okay, maybe this will be like Venezuela. Um, you know, clearly that's what the administration had been saying, and this will be over quickly, and that's probably good because there's more— you know, we've had a little— we've you know, killed a lot of this leadership who might be looking to destabilize the region. Um, and as time's gone on, it looks very clear that that is not true. And not only is that not true, I think we, we clearly did, did not foresee that the, um, IRGC would look to harm and attack a lot of the infrastructure the region, right? And so, you know, we had this period of time where the market was like very shaky. We traded down, but it was still clear to me that the equity market expected that we were probably going to get a relatively good resolution within, you know, maybe 4 to 8 weeks. I think the administration at one point said 4 weeks, then they said 8 weeks. Um, and then what happened in the last, you know, call it week, is that the straight-up moves has been closed, uh, which, uh, you know, significant amount of the world's oil supply goes through the Strait of Hormuz. There's— the administration has been trying to get a, you know, other countries to come and help open that, the strait, um, and that hasn't happened today. And so there's been, of course, a supply shock in oil. And so that's why we had the initial, you know, oil trading up. I think we traded up to about $110 Um, then the, then, then the administration came out and said, hey, listen, like, you know, this will be okay. Like, we're opening up, we see that there's potentially going to be a resolution. Oil came back down to like $90, $95, and the market, you know, kind of really traded up at the end of, of last week. Uh, and we saw crypto really rally on this. So I think Bitcoin ended up going up to about $70— maybe it was earlier this week, but it went up to about $75 or $75K. And, um, you know, Hype went up to over $40, $40. Uh, as we saw pretty much everything up 10%, 20%, 20%, 30%. And it was clear that there was a bit of a relief and an expectation that now this is over. And then all of that changed yesterday, or I guess the last two days when the, the IRGC struck a— I think it is the— it is called the South Pars field in Qatar. That, um, is part of the same reservoir that also Iran has a piece of, that is 20% of the world's liquid natural gas supply. Uh, it's estimated to have cost like $70-80 billion to build the infrastructure to take that natural gas out of the ground. And then we— I mean, we're denying it, but some version of us, Israel, you know, etc., looks to have then struck the Qatari side of that same reservoir. And we've now— it looks like potentially that the, you know, something like 20% of the world's liquid natural gas supply might go offline for a very extended period of time. And that has downstream effects that are in every way inflationary and, uh, and, and bad for growth, right? And so now you've seen it happen. We, we, you know, the, the Fed held rates steady. Yesterday, and they, uh, now the market is only pricing one rate cut this year, which is obviously bad for risk assets. And the— if you looked at the front end, uh, of the UK Treasury market this morning, like, it was clear that there— a lot of macro funds were really struggling with what was happening, uh, in, in the market as well, and if we were going to see a lot more inflation and how they should react, should there be rate hikes. And so I say all of that to say that this is a really an Iran inflation growth story, and all of it is downstream from what's happening in the energy markets. And we just really do not know. And I do think crypto has a good backdrop right now, um, more broadly, and Bitcoin has traded relatively well. But, you know, if there continues to be this macroeconomic shock and we have this downstream effect that is, is, you know, quite impactful, I don't know if we're going to be able to have risk assets really take off in the near to medium term.

Yeah. Just to give people some context, I mean, before this Operation Epic Fury, I mean, oil has traded up roughly 50%. I mean, it started at $70 a barrel right when the war broke out over the weekend a couple of weeks ago, it was traded up to $86 on Hyperliquid. Now it's sitting at like, what, $116, $120? I think it hit a peak of $130. So yeah, I think it's been a deteriorating situation. Um, we're going to continue to monitor the situation. But, uh, what's interesting though is like, um, we should probably have a commodities kind of expert come on. Um, but one of the things is, um, like, what does the curve look like for oil? And I think it's still very much like, um, like WTI futures, like they're like, uh like it's— there's massive backwardation, which means like, you know, the front of the curve is much higher than the, the back end of the curve. Uh, that tends to be kind of like common when there's these supply shocks. Um, but that's something that I am monitoring is like, how does that curve look like and how does it shape up? Because I think typically the market would have assumed like, hey, this is going to get resolved, the Strait of Hormuz is going to open up, and this is going to be like a Venezuela-type situation, but it's starting to look like it's probably going to be a bit longer. I don't know if it's going to be like an Iraq, Afghanistan-type situation, but yeah, I think there's uneasiness in the market, and I think who knows how quickly this gets resolved. But certainly, to your point, like, things have escalated. I was a bit shocked of the retaliation. Like, a lot of these You know, Iran is basically, I think, sent a communication around anyone that is in like these oil fields should probably evacuate, which means that they're going to target them, uh, and want to avoid casualties, but they're looking to destroy massive amounts of infrastructure. Um, there's no amount of like theories of 3D chess of like what this means. Like, um, I don't know if I buy any of those, or nor should we necessarily talk about them here, but What is interesting though is, you know, Hyperliquid continues to get a ton of traction. That continues to be a strong theme as a result of all of this. Should we briefly touch on S&P perps that I think just recently launched and what your take is on that? ZKSync is the bank stack of Ethereum. ZKSync's Providium is the only Ethereum-secured platform that is purpose-built for institutions that demand privacy, compliance, and full control of their data. zkSync enables financial institutions to thrive in the digital assets economy by launching and monetizing their own chains, tokenize real-world assets, build programmable markets, and settle cross-border in real time. Visit zkSync.io to learn more about the bank stack of Ethereum and book a demo. As always, investments in blockchain technology involve risk. Terms and conditions apply. The Blockworks Digital Asset Summit is back in New York, March 24th through 26th. We'll have top speakers from leading asset managers, financial institutions, DeFi protocols, crypto companies, and policymakers all under one roof. Think BlackRock, Coinbase, Robinhood, and more. Follow the link in today's show notes to buy tickets and make sure to use code EMPIRE200 for $200 off at checkout.

Yeah, I mean, super interesting. The, um, the S&P has been pretty forward-thinking around this space. I actually did— I worked with the team over there to do an announcement for— they did a tokenized index fund last year in 2025. I think it actually launched in September. And so we announced that— I helped them do that announcement with Centrifuge and, um, and, uh, I think it was Janice Henderson, uh, like last, like, July or so, uh, and that funds them pretty well. I think it's $500-600 million of AUM right now. And so the clearly, you know, S&P was already thinking about, like, okay, how do they want to be on-chain? You know, what sort of, like, tokenized asset, um, strategy should they be, should they be doing? And to your point, you know, Trade XYZ, uh, with these, these HIP3 markets has just really kind of come to the forefront of, um, just everybody's— like, every trader is thinking through, you know, how do I get access to the things that are happening over the weekend, 24/7? There is no kind of, you know, centralized exchange way to do this with real liquidity. It is hyper liquid today. That, that dominates that market. I mean, we've seen it be on the front of Journal— we've— the Journal, in front of Bloomberg. Like, everybody's talking about this right now. And so, you know, obviously they would have been working on this for a long period of time, wouldn't have started today. But it seems very timely that now, you know, it's not just, hey, okay, well, we're going to launch a HIP3 market that has some sort of, you know, kind of pulled together oracle that we did, right, right, from like a data feed that we're getting from, you know, that we're paying for from, you know, one of the exchanges or something. But now we're going to work directly with the S&P to be able to offer like an official product. And that does to me signal a world where right now Hyperliquid is still very much a prosumer product. And maybe to me signals a place where we can maybe in the future get institutions trading these markets as well. There's still a bunch of KYC and other, other concerns that you need for the institutions, but this is obviously a really good step in that direction. And congratulations to, to, uh, Shoku and the team there for getting this done. Yeah.

No, it's big. Uh, I wonder how much volume, uh, they're going to get over the next, like, if you were to predict like how much volume these guys get versus like the, like some of the commodity, like oil or copper or silver or gold that has been pretty active. Do you think this actually surpasses them fairly quickly?

No, I mean, you look at traditional markets, right? Like, you know, FX commodities, they trade more, right? Um, I, I, I would think that these markets and they've traded more in hyper liquid. I, I would think that these markets would mirror traditional markets because it just mirrors interest. I do think, you know, sometimes you see these like volume blowouts on specific equity names because they become like meme coins for the retail crowd, right? I think for the index, like, I think it'll do well, but I would expect it not to, you know, necessarily be, um, you know, outsized relative to, to other stuff.

So yeah, Hyperliquid sitting at $40. I mean, that's a $37 billion FTV, roughly $9 billion market cap. I've heard a lot of chatter on the timeline around, hey, look, it's kind of over for some of the other networks. Like Hyperliquid just dominated. Perps are a killer product. What's a— I mean, Solana, it's still a fraction of some of the other networks. Like, what's the argument around— can Hyperliquid, um, or the validity around— can Hyperliquid just become bigger than Solana? Could it become bigger than some of the other networks? Uh, or like, what is the argument of it being pretty fairly priced at this point?

Um, I mean, if you look at like a traditional, like, you know, exchange multiple and, and, and decide that like fees are, you know, entirely just revenue, fees and revenue are the same thing, which I think is probably not the right, uh, the right way to think about it, but, but some people do, uh, both Hyperliquid and Lighter actually trade at discounts to, uh, on a multiple basis to traditional, um, exchanges. I think the, the Syncrasy guys put out, uh, um, you know, some, some data around this this week that I saw. And I, I haven't looked at my— I haven't checked their work, but I'm just assuming they're right, um, based on the data they put out. Uh, and so I think there is obviously, you know, a world where these markets continue to get— I mean, these applications should continue to get bigger. Like, I think it's very clear that, you know, perps markets on-chain offer very good product, and they will continue to grow. They will continue to take market share from the, you know, centralized exchange venues, um, and over time the real headwind or the real risk right now is definitely regulatory and what that means over time. But, um, you know, it hasn't, you know, in this, uh, with these regulators who definitely want to be pro-innovation, um, you know, I think that's less of a risk than maybe, you know, at another time. And so they're going to continue to grow, right? And obviously they're— and what they grow, revenue will grow. And there hasn't been a you know, a fee compression or anything yet at this point. Uh, yeah, but, but then your, your question is, okay, well, what does that mean in terms of like a broader network, right? And I think on the broader network side, it is— it's interesting because applications can definitely be more valuable than some of the networks. Like, there's no doubt that Polymarket and maybe Hyperliquid and, you know, some of these, these big guys will be more— like, Polymarket is, is worth more than than Polygon is today, right? And yet they, they have all of their, um, all of their volume on Polygon. I think that will— that type of flip will continue to happen where the best applications accrue more of the value. Um, but do, do I think Hyperliquid is gonna, you know, HyperEVM is gonna become like a huge Solana competitor for like the everything else that happens on-chain? Like, probably not, right? But they're going to continue to build this incredibly robust and a really great application and ecosystem around trading that they're doing.

Yeah, I mean, just to give folks some perspective, over the last 90 days Hyperliquid is, um, uh, top of the leaderboard in terms of REV. Um, uh, they've, um, even total revenue, they pulled in $140 million over the last 90 days. Second of that is Tron at $82 million, then Solana at, you know, $90 million, then Ethereum at $60 million. The L1. So on that basis, Hyperledger continues to be probably the— and my estimation is it likely dominates over the next 12 months in terms of fees, just given the— I continue to be very encouraged by HIP3 and the activity you're seeing there. So I don't necessarily would attach that much value to the HyperEVM. I actually don't necessarily care that much about that other than like, do you continue to believe that people are going to trade these things? And if so, they're likely going to trade on Hyperliquid. And so, yeah, I mean, you know me, I'm curbing it on a revenue basis. But yeah, it's pretty impressive what they've done.

Yeah, I mean, literally, like their ability to launch markets quickly, to bootstrap liquidity quickly, to build a really great product from a technical perspective, and the way that they thinking through, you know, how fees are, how trades are ordered, and, um, you know, how people get, um, uh, are able to— how the matching works. Like, like, very clearly, like, they've done an incredible job, you know, great product. It'll continue to grow. There's definitely headwinds around the regulatory side, but there's people like S&P who are willing to put their institutional stamp on it, which is, um, which is awesome. Uh, and I do still continue to believe that, like, you're wrong about, like, how these— the broader networks get valued. Like, it's not— or nobody's going to— like, if— what do you think HTTP is worth today, right? Like, you tell me what that— what it is worth. But it has no value.

So it's an irrelevant question because the value accrual just was not there or designed to do that, right?

Um, but, but I think I would argue that, like, Solana wasn't really designed to accrue value either with how low their fees are.

Uh, but yeah, but when you look at the, what the composition, like my, when I invest in these things, I don't assume fees are going to be the bulk of, of the revenue. It's actually MEV, right? So REV, like collectively, like if you're creating like heterogeneous markets, it will always allow for MEV, right? There's always going to be someone that wants to pay for block inclusion and that allows for, um, higher margin products. In this case, like I'm never going to make my assumption that just fees being the dominant, uh, in fact, over the long term, fees should encompass less and less of a share of how much value gets captured by the L1. I do also agree with your point, like apps should collectively, the apps sitting on top of the L1 should be worth more than the L1 itself.

Um, but that doesn't mean the L1 itself should be directly compared to its revenue. In terms of value, right? And how you think of it through the value of, you know, what that token is worth or what the L1 itself is worth.

Uh, I mean, you could argue that a lot of it is, uh, I mean, clearly the market sees value in some sort of memetic component and wealth creation and brand and goodwill. I just don't like underwriting that. Uh, but I am like, if you look at this chart, for instance, I am encouraged by Hyperliquid. You know, revenue continues to grow up, grow quite a bit. Um, you know, you have a reasonable price-to-sales like here that is not totally disconnected from reality, right? When I look at should I actually put a position on this thing or not versus go buy something in the real world like Figure at $7 billion, you know, market cap and growing and pretty interesting like that, that's what I'm saying. Like, um, it— I want to bring on the Frictionless guys who've done a lot of thinking around valuing these things. I'm not saying like you strictly should look at it through its lens, but I do think that, um, it is a forcing function of saying, okay, what do I need to believe for this thing to actually eventually shows up in revenue? If you're not capturing that much revenue, all this hypothetical discussion around moats and, uh, you know, if you can't accrue value, then that is, uh, you know, representative of the quality of the product, the community, all this stuff that people talk about.

Um, and, and So, um, there are a lot of technologies that are sell for very high valuations or worth very high amounts of money, uh, who don't accrue a lot of value, right? But they enable a lot of value to be—

what's a good example of that?

Um, I mean, like, obviously, like, we talked about HTTP, right?

But there's a significant amount of value of HTTP, like, no one ever attached value to that. They provide it, they provide a useful service. It's a common good in the same way that, you know, but there's a lot of common goods, right, and that are worth something, right?

And there's a lot of— I mean, there's a lot of businesses. I, I don't want to name specific businesses, but you and I both know there are a lot of businesses that have, have sold at 300 times revenue, uh, because of the, uh, revenue, the value that they allow someone else to accrue, right? Or the synergies that they allow for somebody else, right, who by themselves— and we've seen this in crypto, we've seen this in in AI that by themselves they actually don't capture a lot of value. There are a lot of, of companies, uh, in our space and AI right now, some of the deep tech spaces, who are not by themselves good businesses, but they are really good technologies that enable other businesses to be built on top of. And that is worth something. What is that? What is that worth? Is it worth— is it Moore's Law? Is there, you know, network value? And, you know, the— it's some, you know, call it, um, you know, multiple of the amount of value that exists in the amount of nodes or the amount of value that, that is built there. I don't know if that's true, and, and exactly how to value them is, I think, still very up in the air. But I think what is true is that, you know, assigning a revenue multiple to an L1 is the wrong way to think about it. Uh, sure.

I mean, look, uh, you and I can have different opinions on that. I think about railroads.

We have to agree on everything.

No, no, I mean, railroads are a good example of this. Like historically, you can look at that and like who actually accrued the most amount of value? It wasn't railroads. It was the cities that were connected and all the values and services that were built on top of that. I do think that this is like one of the things like I'm not going to go out and short L1s because crypto markets defy rationality by any stretch of the imagination. And so, you know, I don't think it's a useful exercise to go out and short these things. but I'm not going to put in a position on them. I'd rather invest in applications sitting on top of these networks that are reaping the value of that. Like, you know, fees, going back to fees, like the average transaction price has gone dramatically down, even in Ethereum L1. If you were to have built your analysis around, oh, that fees being high, it actually like just Jeevon's paradox, right? Like fees should continue to go down to allow for more transactions and what have you. But it's probably something that over the next 5, 10 years, I don't think that a lot of value will accrue to L1s unless they diversify. And like there's growing MEV, but like let's talk about tempo because I think that's something that we should, we should just kind of like not, not have this theoretical discussion on price to sales, price to revenue, like who cares, right? Ultimately the market believes there's a willing buyer and seller at that price. So, you know, We're not here to fight that. But Tempo is interesting because I've heard a lot of folks just converge on this idea that stablecoin transfers in and of themselves don't accrue much value. It's the values, the other things that are enabled by having stablecoin, like instant settlement and instant payouts. So yeah, why don't we just touch on Tempo if you want to give us a rundown and then Yeah.

Yeah, I mean, I think everybody at this point knows about Tempo. Obviously, it's the Paradigm plus Stripe collaboration for, you know, really trying to build a payments-focused or payments-first blockchain. The ways they do that are a couple of different things, and there's some technical nuances to how they have built certain products that are embedded into the chain. Uh, the main thing that I think matters is that they basically preserve the majority of the block for stablecoin transfers, and they basically deprioritize any non-stablecoin transfers. Uh, and they also provide— it's also, there's like a fee schedule, and they do kind of dynamic fees, which— and so it's, it's very much trying to incentivize stablecoin transfers. And the idea is that, like, instead of being permissioned, you're just putting the right economic incentives in place so that the only thing people actually want to do on the chain, or the thing that people will hopefully want to do on the chain, is do, you know, payments, essentially. Now, you know, it launched yesterday, mainnet launched, and I think within 10 minutes there was an Epstein-related meme coin on Tempo. But maybe that's just crypto. But clearly what they've done is they've built it in such a way that's supposed to be like, this is for payments.

Right?

And all of their business development around what they're doing with Stripe, Bridge, Privy, the entire ecosystem there has been about how do we bring people a package of doing on-chain payments inclusive of, of this thing, right? And so they launched yesterday. They also announced, uh, uh, I forget, it's called MPP. I forget exactly what MPP stands for now.

Machine Payments Protocol. Open source payments protocol. Yeah.

And so that's like an agent payments protocol that you can use you know, stablecoins or, or, um, cards or a bunch of different types of payment mechanisms and trying to be kind of an open standard for, uh, for, for, for, for, you know, agent payments and agent, um, economic activity. That is, anybody could technically extend it, but most of the, the governance, like basically all the governance right now is done at the, you know, the tempo level. And so it's not quite an open source you know, project yet, but, um, in terms of like, you know, actually being able to have, you know, other people, um, impact the way it works. Uh, but I think, I expect they'll do that over time, but that competes, you know, kind of directly with, you know, some of these other protocols or these, these kind of standards. It's really a standard, uh, for, you know, agentic economic commerce. So things like X402, which, you know, Coinbase is obviously behind, um, and, you know, OpenAI and the foundational models all launched their own. Google launched their own. Uh, and so there's a lot of these people who kind of have these standards out there. Uh, and so, you know, that's also, I think, somewhat interesting at the time when everyone's thinking about agentic, uh, agentic activity. But all of that to be said, that brings it back to your original question, which is like, okay, so this is an interesting piece of the, you know, Stripe, you know, pie, right? But does Tempo itself accrue value, right? And that was kind of what you're asking because it raised at a $5 billion valuation, but will the fees and all of the economic value accrual be done by other Stripe products or, you know, other bridge products or Privy, not Tempo itself, unless maybe it launches a token. So I don't know, what's your perspective there?

Yeah, I don't think like, uh, stablecoins alone carry the boat to justify that valuation. It's what it allows, um, like value-added services on top. Um, um, so Is it worth $5 billion today? Probably not. Is it going to be useful in the aggregate for Stripe? Yes. You know, providing better services to their customer base. What was interesting is, I mean, part of the benefit here is the muscle that they have. I mean, out of the gate, they have Visa collaborating with them. We have a bunch of other ecosystem partners. You know, I quote, for example, our design partner Visa has already extended MPP to support card-based payments on their network. Stripe has extended it to support cards, wallets, and other payment methods through their platform. Lightspark has also extended for Bitcoin payments over Lightning Network. And I think like that's, you know, we've talked about it here at length, which is like, this is kind of like when Libra launched with a very impressive set of partners and never got off the ground. Obviously, I am very curious about what, how much traction they get I forget, but I saw a chart around like, was it x402 payments or the activity there has like kind of been declining and it was all the rage a couple of months back and now like there hasn't been that much activity. I am, I am curious.

I mean, there's been basically no organic x402 activity ever. So there was like some people, there was some like people who were like launching on top of x402 that If you look, it looks like wash trading and people thought maybe there would be some, you know, base or x402, like, you know, value, you know, token value accrual at some point, but there's basically never been any real activity on x402 yet anyways.

Yeah. Yeah. I, uh, I'm looking here at cumulative stats, 75.4 million transactions, 24.2 in total volume, uh, less than 100K buyers. Uh, I, I am, uh, when you look at that, like, Does that, um, I don't know if you guys made an investment in like Agentic Commerce. It is a key narrative, right, around like, you know, people get excited. Like the common thread that I'm hearing now is like, you know, blockchains were not built for humans, they're built for robots. And, you know, this is crypto trying to be relevant in an age of AI. But how do you see, um, I actually do think it will, it makes sense to spin up an agent and give it you know, for an agent to use stablecoins, uh, when it can't KYC and whatnot. Like, I do buy into that narrative. I think it's quite real. Um, but what would you attribute the, the— is it just the X402? Like, was that just— there's not enough use cases, people are not thinking about it, there's not enough—

there is no agented commerce today like that. There is no agented commerce at all. Like, it— like, we are all talking about agented commerce. It does not exist. Right now, it doesn't mean it, I mean, not zero, obviously, but like it's de minimis, right? And all of the agenda commerce that is happening today is happening through traditional Rails using Stripe's APIs for the most part. Right now, does that mean it won't exist in the future? No, that does not what that means. Uh, but X.402 and the Google and OpenAI and Anthropic and now MPP, all of these standards exist, but nobody has agreed on a standard yet. Right? And there needs to be some agreement on a standard in the future for us to continue to build, you know, more economic value around that and, you know, products around that. So we're going to have to see one of these things win over time, right? We're also just going to have to see agents get better because agents are great in a lot of ways today. But the near-term, you know, activity that we're seeing is things like enterprise use cases, for, which is like really like advanced RPA, right? It's like automation work, right? Or it's, you know, helpers to you and I who on research and on, you know, maybe, you know, some of our workflows, right? But even, it was not really a way for us to do, I mean, there are a lot of people who have like Perplexity launched a product and other people launched a product around like, oh, could we pay with an agent to do something? Those, those products are still very clunky today. And, and also the reality is, is like, because of the amount of approvals that you have to do on those today, it, you, it would take me longer to buy, you know, toilet paper through Perplexity than it would just to do it myself and click into my Amazon app. Right. And so it's like not a great user experience yet. And also there's, for a lot of things, humans want to buy, they want to be buying things. And so I think the story that you were, you were referencing earlier, which is the better story, isn't about merchant acceptance from agents. Uh, it's more about, is there an, um, an economy that exists outside of human to merchant, you know, payments or business to merchant payments, um, that is net new and that agents are doing? I think that's the story. That market is very, very far away from actually existing. There are a lot of people building around it today. But we haven't done a deal there yet because it feels so far out in the future and so unclear how that market will exist that we're doing— we're having the conversations, we're meeting the entrepreneurs, we're trying to be smart about it, but it just hasn't yet felt like the risk-reward is there relative to how hot the market is and the valuations that these companies are getting when, you know, when it doesn't exist yet.

Yeah, I got a— I had to really look at a deal that this particular individual was leaving one of the larger card networks and said, hey, I'm going to, I feel like this is going to be a big thing. I want to launch my own. I didn't end up investing that because I do think that distribution is king here. And it's very, what Tempo's gotten very well, it's like they just have an impressive BD muscle and distribution partners out of the gate. And it doesn't mean that other, you know, there isn't an opportunity for other folks to thrive, but it's just hard to compete against a super well-resourced, very human capital dense organization that has a lot of partners out of the gate. But we'll see. I mean, I think, um, um, um, are, have there been projects that have come to you in the kind of early stage and said, hey, we're going to build on top of Tempo? Um, cause that's an interesting stat. Like if you look at like the, for instance, the, uh, there was a time where like there was 99% of the projects were just purely Ethereum. And then that pendulum swung a little bit more towards Solana. Now you're seeing some activity in Hype, like Hype, like Hype EVM, like, you know, that ecosystem being built out a bit. Have you seen major changes or people come to you and say, hey, I want to build on top of Tempo? Is that even a thing? Or is it mostly closed source and people are just not building on top of it?

So, so we haven't seen a lot in the way of like net new entrepreneurs yet. Um, there are obviously people I was sitting next to. Dinner last night next to the founders of one of the largest DeFi protocols. And, you know, I don't, I don't think they've publicly announced it, but they've already been deployed there for a little bit, and they'll, they'll do some work there. And there are obviously a lot of people deploying there in tempo. And yeah, on tempo, uh, they just haven't announced it yet. Um, but, but I, I— the thing they did do is they like enshrined their own DEX, right? And so they will, I think, in the same way that, you know, some of the other more commercially minded L1s have done, they will just create create winners, because if they create winners, then liquidity will aggregate. And if liquidity aggregates, then like it's a better product, right? Yeah. And so I, we haven't seen much in the way yet of what I would say developer, uh, net new, like, you know, call it projects building there that are trying to raise capital. I'm sure it'll happen, you know, uh, over time. But the, the business, you know, the, the way it's built, which is really around payments. Like, they do not care. They, they are very opinionated about what they want to be, and they don't care if, like, the latest DeFi, you know, person or latest DeFi entrepreneur wants to build there. Like, that is not their business, and they've, they've explicitly said that, right? And they've made design decisions to do that, right? And so if that's the case, like, you're just going to see less new net new entrepreneurs. And what it is going to be, though, is it's going to be focused on this one use case, really focused on this one use case. And it's probably, at least in the near term, going to live or die based on the BD motion of Stripe, right? Yeah. Eventually, maybe it'll be broader and there's, you know, referrals and there's liquidity, um, uh, sort of like liquidity beats liquidity and being on the same chain as the partner, you know, is a good thing, right? But, but today it's, it's, uh, it's going to live or die based on Stripe.

Yeah. Who, um, There's a lot of opinions on the timeline that we don't have enough time to discuss, but who stands to benefit other than Stripe, uh, equity holders? I would argue who stands to benefit and who stands to lose the most in a world where Tempo is successful. I can think of who loses, um, but I'm curious. You always go to this podcast, Rob, since you're the newest member here.

You, you just want me to say the, the spicy things so people—

well, you know, I, I've sort of stopped competing against who's gonna get the first 10-second clip of like, you know, that, that's your role, Rob. I'm, I'm happy in my lane. Just, I don't deliver that. I'm like an old dog, man, you know. My takes are washed down. Like, you know, I'm, um, you're like that, um, that meme of like the guy in the hot tub, you know, like unbothered, unbothered, moisturized, in my lane as the world blows up. No, Um, but yeah, like, who— I mean, you and I share— I'll— maybe I'll start. You and I share this investment prison, Codex. First, you know, it is top of mind here. Very sharp guys, a lot of really, uh, very opinionated as well. I think they have really unique insights, uh, but they've, again, super specific on this. Like, um, you could argue they, uh, are now going to compete against Tempo, right? And I can think of others, but yeah, how do you think about the—

Yeah, the Codex guys, obviously there's more to that story in terms of like the partnerships. They've actually pivoted. They announced it today. You probably haven't seen it, but they're now entirely focused on FX business. And so they kind of launched their rebrand today. And they're actually doing a few hundred million a month in FX bit right now. So they're— and that's growing quickly. So kind of a different business, uh, and I'm like, to your point, I'm big fans of Haonan and Momo. Um, I, I think on the loser side, obviously, like, you know, who's competing the most? Like, who has dedicated payments teams that's competing on payments, right? Solana has a big dedicated payments team. Uh, Moned has a big dedicated payments team, and they have very good people there. Raj, who, um, came from Visa, uh, and then Portal, uh, runs that business for them. Um, you know, there's a— then there's kind of like the— it's like Circle Arc, right, which hasn't launched yet. And there's, um, you know, and then there's the— you know, you can debate whether or not— it's not clear to me that like Plasma or Stable or any of these guys actually wanted to be payments. They just wanted to be kind of like places for, for, you know, Tether to sit. Um, but there's definitely people have like, you know, pitched the stablecoin chain before. Probably actually the one that the, the other two that are people talk about less, but that have been done more of the work there have been Polygon and, um, uh, and, um, Tron. No, Tron, yeah. And then there's the one, the first one that Stripe invested in, um, which is, um, uh, my name is— I'll remember the name earlier, but the PayPal, the ex-PayPal head of crypto, um, is there now. Uh, those are actually the guys.

That's, uh, that's, uh, Polygon.

No, no, no. Uh, Polygon took somebody from Stripe, a guy named John Egan.

Yeah. Oh, PayPal, you mean? Yeah, yeah, yeah.

But the, um, uh, listen, Polygon is actually doing like a lot of payments volume today and they have a bunch of institutional payments partners. Like they are now directly at— and they, they did that acquisition or two acquisitions, I guess it was early January or, or December that made them kind of a fully verticalized payment stack. Right. And that's essentially what's happening here with Tempo and Stripe and Bridge. And so, you know, they're that— they're going to be a real competitor, right? Solana is obviously taking a little bit of a different approach because, um, they started, I think, leading some VC deals. So they're definitely trying to, you know, continue to put money into and, and, um, you know, work to get the right people building on top of them. Uh, but they're— they haven't necessarily owned, you know, that call of, uh, a fully verticalized stack. Today. Um, and so, you know, that's the competitive set, right? And those are the people who obviously are going to be, uh, going to be worried about, about Tempo. Um, I think to your point around, okay, well, well, what happens in a world where they're really successful? Like, who accrues value? Well, yeah, I mean, clearly the Stripe equity holders accrue value. Um, theoretically, the Tempo equity holders accrue value, or if they launch a token. Uh, I, I do— a lot of economic activity happening on an EVM chain is probably just good for all of crypto. In some sense, it is a rising tide, but it's, you know, it's probably less good for Ethereum than it is good for Tempo, but it's not bad for Ethereum if more economic activity from corporations is happening on Tempo, in my mind, right? Maybe it's bad for the payments-focused guys, or, you know, the, uh, the L2s. I don't think it's bad for like Ethereum mainnet, right? Because that was never going to be a place where you did, you know, a large-scale amount of traditional, you know, payments, right? So I actually think, I mean, I think there's a rising tides lift all boats thing that's happening here.

That's always been the rosy kind of, uh, you know, more activity lifts all boats. And so the, if someone wins in some part of the ecosystem, it benefits everything. I actually think My stance is a bit more, uh, cutthroat now. I think, uh, you know, that there is likely going to be, um, you know, that's always the position of a weak, of a weak player, right? It's like, oh, this is good. But the reality is I, I think probably more concentrated volume, um, even though there's interoperability, even though there's, you know, uh, you know, the user that enters via Tempo could maybe go to Ethereum, uh, prob— maybe. I'm, I'm not sure, um, but, uh, we'll see. I mean, I think the tendency for companies, whether you're Solana or LayerZero or Stripe, is to own that user and not share with anyone else if you don't have to. Um, but, uh, I just have a perspective.

And by the way, it was Stellar I was talking about earlier because I actually today Stellar and Polygon are definitely doing, um, probably the most payments in terms of like actual payments. You know, Solana is there as well, but, um, you know, they've started to get a lot of partnerships on board. A lot of those partnerships aren't really— haven't really scaled yet. Um, but the— if more and more of what you and I do on a daily basis happens to be on-chain, more businesses will build on-chain, and there'll be more RWAs, there'll be more tokenized assets, there'll be more stablecoins, there will be more um, net new novel products that will exist because blockchains enable that, right? And I, I think it's very clear that like there is no one chain that will win all activity, right? Like I think that's a very myopic view that doesn't really make a lot of sense. Uh, we will probably eventually have a fully abstracted, you know, routing system at some point that all of these guys will plug into. That will, you know, give you best price essentially across all of these different chains. Uh, and the fact that, you know, Tempo might— let's say Tempo is really successful and they own, you know, all of the like cross-border payments, right? Um, those— after that cross-border payment's happening, they're being delivered to somebody. If it's going to an end user, that end user will have a wallet. That end user with that wallet will figure out ways to spend and save and do all of these other things. And, um, you know, the design decisions Tempo has made today is not to serve that, that ecosystem. It's to serve the cross-border payments ecosystem.

Yeah. Uh, yeah, I think this goes back to what I was saying earlier. And, and, you know, you've probably heard me say this a year ago when I was starting off at Immersion, which is more value will accrue to, to the applications, the Klarnos of the world, the new banks of the world. They can choose the infrastructure beneath them, right, to lower the cost of, to serve. I think time and time again over crypto, once a new player comes in, it just introduces more competition at that infrastructure layer. And that's always been beneficial for the end customer above anything else. When Solana came in and sucked in a lot of DeFi activity from Ethereum, that galvanized the Ethereum community to say, okay, we got to get our shit together because we're getting our ass kicked here. And I think Tempo coming into the fold, like in the same way Hyperliquid made it abundantly clear to the Solana leadership that they missed, like they dropped the ball on, on perps. Now you have Bulk, uh, a response to Hyperliquid and it launched like this week. And so that's something that I'm paying attention to, but I think that competition at the infra layer is good for the app sitting on top and ultimately the consumer that is seeing that because they have just access to more products. They don't really care what that gets routed to, to your point, right? I mean, it's, you know, going back to HTTPS, like all you cared about was like, oh gosh, I could have access to Gmail, not just Hotmail. And that's good for me. You know, this seems pretty good. And commerce online just became safer. So I think, um, um, that, that's where I sort of mean, like, I think I'd rather be investing in sitting a layer on top because it is just fiercely competitive at the infrastructure layer. And. Um, but net-net, it's good for apps, it's good for developers, it's good for end customers that are just going to benefit from greater ease, uh, and convenience, uh, when they're trying to use any sort of stablecoin or crypto-enabled product for that matter.

Yeah, I mean, there's no doubt it's— being on-chain is better for consumers, right?

Yeah.

And like, that— the consumers are the ones who are going to win, uh, in the end.

Yeah. I got, uh, 5 minutes, frogs. How about it? Expensive call with, uh, with a lawyer here that I don't want to be late for. But there's just a couple things where we get the content of the week, my favorite part. Uh, Kraken, we've talked about it at length. They just came out saying that they're delaying IPO plans.

I think so. They didn't, they didn't say it. Well, there's a CoinDesk article that said it. Um, I don't know if that's actually true or not. And I, I will say that, you know, I know the team there pretty well, and I, I think, um, uh I, I, I don't expect this to be a material, uh, bump in the road for them.

Yeah, I think when they were raising the last round, a lot of— there was certainly like a lot of SPVs, a lot of people that came in. It was a big round. A lot of them were kind of looking at like, hey, there's, there's likely going to be an IPO event. Uh, I don't think anyone underwrote this year. I think most people assumed it was going to be like a within the next 3 years kind of thing. And I would probably think that that continues to be on track. Um, you know, irrespective of like macro conditions and whatnot. Like they've been, they've been like in this IPO readiness track for quite a bit of time and they continue to ship really good products. And so I, I think it happens within probably, probably next year. Um, unless there's some like major kind of catastrophic market event, I think they could probably be ready to IPO next year.

Yeah, I, I, I, um, I still think this year is possible. So really, um, yeah.

Are there, are there on this point, are there other, uh, in the docket? Like, uh, I think we saw just a huge wave last one was BitCo. Is there anything else that's coming on?

There's a bunch of people who might come this year. Uh, I think nobody has decided for sure. I think it depends a little bit. The markets probably need to stabilize. Like, like the IPO market all of a sudden kind of shut again with the, the war in Iran, right? And so, you know, until the risk, risk markets are back, like, you're not going to see any good IPOs, let alone, uh, the, you know, got the crypto ones. You also probably don't want to be going at the same time that OpenAI and SpaceX are going. And so you probably want to avoid that. And so you're probably— your window is like, you know, call it the next 3 to 6 months, or else you want to push it to next year. So, but there's a lot of people— I will say that I do think a lot of people want to get, um, get out before the next election.

Yeah, yeah, we should. Jano is our resident, you know, in-house political expert. We'll save that discussion for next week at Dash, which I'm very excited about. Um, and we should talk about like what it means for crypto, uh, if the war continues and, you know, approval ratings go down. Like, you know, you have a different, you know, shakeup in the Houses, like what that means for the Clarity Act and a bunch of other things.

But I mean, if you look at PoliRock right now, it's, it's, it's flashing to you, uh, pretty clearly what they think is going to happen in the midterms.

Yeah. Does that worry you?

No. I mean, it's also typical in the midterms, right? Like the, uh, the House is almost certainly going to flip Uh, the Senate is in play. I don't think anybody thought the Senate would be in play, but, but now it is. Um, we'll see. I think, you know, the number one thing will be kind of the downstream effects from Iran war and how long the Iran war goes, to be honest. Yeah.

Yeah. Speaking of, as an aside, before we go to content of the week, uh, we— so Token got canceled. I think a lot of conferences— I think Token Singapore is still going to happen, but, uh, you can expect airfare to be dramatically more expensive. Going forward. Just kind of wild how that spiked. So I hope you, I hope you booked your travel in advance, Rafa, some of these conferences. I know you and I are going to go to an event that you guys are doing in an undisclosed location, but I'm glad I booked that airfare well in advance because it's looking pretty, pretty steep now.

I've already got my airfare booked to Monaco to come see you. So yeah, don't worry.

You have, you have a couch, man. You know, Um, all right. Well, that's a, at risk of going down geopolitical route yet again. Uh, I think we've, we've maintained ourselves pretty, pretty good here. Uh, not, not down too much into that. Uh, what's the content of the week here?

Two things. One, the most obvious thing, which is it's March Madness. So like it is, you know, it's college basketball. One of the most fun times of the year.

What's, what's March Madness?

No, you're not serious. You're not serious.

I'm not, I'm not that bad.

I won't let you, I won't let you have that. Um, so March Madness, you know, obviously that's on my mind.

And then, um, are you a Buckeye?

Uh, yeah, Ohio State Buckeye fan. So they have an 8 seed, you know. Um, so we'll, uh, you know, it's a football school, not a basketball school, but we'll see. The basketball team's had an okay season, so we'll see how it goes. Um, and then, uh, you know, I have to get back to, to my horror movie roots, and there's, uh there was a movie called Ready or Not, which was actually like a very fun movie about a woman who, you know, got married into a family. And it turns out this family has sort of a very odd tradition about having to, like, sacrifice, you know, kind of the new— the new bride. And then she kind of ends up beating the— beating the family and ended up not being sacrificed. But the sequel to that comes out tomorrow. It's actually very fun. It's a cool movie, you know, kind of an action. A horror movie. Um, it's all— I'll be seeing that on opening day.

So you're gonna go to the movie theater and popcorn and all that stuff?

Oh yeah, the, the, the, the— there's a, the one you go to serves like old fashions and this. I mean, I'm gonna have an old-fashioned and maybe I'll have a, you know, popcorn, or maybe I'll have a burger, you know.

If you ever want to myself go on Friday, I feel like we leak a lot of alpha. If you ever want to raise from, from Dragonfly, you just have basically gotten a blueprint as to how to approach approach, uh, talk about horror, have an opinion on old-fashioned, um, and, and I'm an old-fashioned connoisseur, you should know that. Yeah, yeah, I know, I know that now. I think the market now knows that. And so I think we use this podcast— if you ever want to raise a round from Dragonfly, there's a lot of primary, like, alpha here, the breadcrumbs that you can just pick up and, and, and, and, like, show that you're prepared. Um, so my content of the week is, is always more boring here. Uh, I started, uh, reading, uh, Karl Malone's book Born to Be Wired. Just a really fantastic— I've always had it on my list. I read Ted Turner's book a while back, and that's obviously intertwined, but this one is just phenomenal. Just a really fascinating story of how they did roll-ups of the cable industry. Of course, they now have Liberty Media. I know how much you like F1. They bought F1, which is probably a phenomenal investment in my mind, but it tells you everything. They laid the fiber, first the cable, then the fiber, which obviously allowed for the internet and whatnot. And then, yeah, really, really fascinating story. It's called Born to Be Wired. I'm halfway through it. I started a couple of days ago and it's just really, really, really good book. So highly recommend.

Cool. I'll check it out.

All right. So what, next week, Das, we're going to be recording live in person?

Yeah, that's going to be fun.

Big time.

And it'll be Yano's big comeback.

Comeback. Yes, that's right. That's right. That's going to be fun, man. I'm excited for that. And if you guys are in New York, let us know. This is probably the time where Yano would be doing a plug to get your tickets to DAS. Prices are going to go up like in 20 minutes.

I think it's almost sold out.

Sold out. Sold out. It's going to be a great event. If you're in the area, swing by, let us know. And excited to hang out with you guys in person.

Cool. All right. See you next week, guys.