Trump's Win, Portfolio Positioning, and Crypto's Return to the US | Roundup

what happens when you let founders and entrepreneurs operate to the full extent of what they think that they can do. And, you know, on the founder side of things, like, we've all been kind of handicapped by what we can do in this industry. And I think that's like the— that kind of power is about to get unleashed.

This can actually be way bigger than $10 trillion or way bigger than digital, like a gold market cap. Yeah. How much value do you think gets settled on the fucking internet? How big do you think that is? You mean like that's not $10 trillion? Sorry, I hate to break it. It's way, way bigger than that.

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God feels good.

Trump wins, you go to Hawaii, huh? Or am I not supposed to? We can actually wrap this up.

Too late for that. I am, I, I am in still in America, the land of the brave, the home of the free, or what is it? The home of the free, the land of the brave.

Close. Yeah, close.

God feels good. Oh, the probability of me moving back just goes up like through the roof. I love this country.

Wow, we got a new Santi today, man. What a, what a crazy week, huh? First off, first off, how was, how was the marathon? I gotta do the, I gotta do the friendly.

No, no, none of this is about me. Like, the marathon is an afterthought. I'm like, I don't—

it didn't even—

I wasn't even thinking about the marathon. I was thinking about the fund. I'm thinking about like the election. But honestly, like, what a great week. I mean, I've been sleeping so much better You are— before this recording, this is— I woke up at 5 in the morning blasting EDM Avicii music. I mean, I got to think that most people in the industry are feeling a combination of euphoria and such a relief because, I mean, it's— when you think and look back, yeah, it's, it's, it's just, it's been tough. It's been really tough to like feel like you're, you know, you don't feel comfortable telling people about the space. It feels like dirty to say that you're in crypto. Forget about the bear market. It just feels now it's like, God, feels great to have someone that actually believes in this. And I don't know, it was a landslide win. So let's— should we just unpack the election?

Yeah. Yeah, let's unpack it. And I would focus on Yeah, yeah, let's unpack it. I'd be curious to get your general takes.

Well, I was going to lean on you because you're the political expert.

But I mean, look, I just finished our monthly kickoff and what we said to the— what Mike and I said to the company is, you know, there's two ways to talk about this election. There is the societal element of Republicans versus Democrats and Trump versus Harris and the societal impact and the economy and taxes and abortion and immigration. And, you know, I don't think that stuff really should, should enter into the workplace. I think companies are better when they're focused on their mission and their vision and making an impact on the world through those things. And so I, you know, on the kickoff, we said, look, I think it's important right now to have there are a lot of people who are really happy. There are a lot of people who are really upset. And it's important to have empathy for both sides. That being said, there's another way to talk about this, which is just from the light of the impact on the industry and the impact on— I mean, we had our— it was our all-hands. So the impact on the company and it was— I mean, it's about as good as it can get, I will say. So, I mean, it's only been 20— less than, you know, it's been 36 hours since the election and what, Bitcoin shot up 7% overnight. It was actually interesting. It wasn't even overnight.

It was when the market started to realize that Trump was going to win, which was the odds of the market went from when the odds of the market, it was, was a direct movement with the odds of the market going from like high 50s all the way to 69 or 60 and then 70. Like you could just— the market was just moving in line with that.

So it was really interesting. So I'm from California, I'm from San Francisco. So I've got a group chat with my high school friends who are all pretty liberal. Then I've got— then I was watching MSNBC and like flipping between CNN, MSNBC, and Fox and just seeing how the different channels were covering it, then Twitter and then Polymarket. And these things, you know, you would think that these things would all be kind of in line or kind of similar with maybe a lag. But the market realized basically Polymarket and the market moved to Trump like a solid 2 to 3 hours before media did. And before, you know, my group chat from home with, you know, fairly liberal friends moved to that conclusion. And so, yeah, I mean, look, the market is— the market's telling us what it thinks. Bitcoin went up 7%, all-time high. Coinbase shot up like 20%. I hope you— I hope you bought that Coinbase when we had breakfast. And yeah, it's just like you saw me confirm the trade on the phone. Oh yeah, you're right. But I mean, like, zooming out for a second, we have operated in an industry where for the first decade of the industry it wasn't partisan nor bipartisan. It wasn't like people didn't like us or liked us. Nobody cared about us. So first 10 years of the industry, nobody really cared about us. But the last several years we have operated as in an industry where people didn't like us, right? Whether it was this recent administration, but even people forget when Trump and 2016 to 2020, he didn't like crypto either. So for the last, you know, 8 years, we've, we've, we've tried to build this industry with the, with a political, um, you know, administration and House and Senate and, and, and kind of the, that side of things, uh, you know, just not liking us, just making it much harder to build and to invest in this industry. And so I think what's going to be really interesting to see and really fun to see is like what happens when you let founders and entrepreneurs operate to the full extent of what they think that they can do. And, you know, on the founder side of things, like we've all been kind of handicapped by what we can do in this industry. And I think that's like the, that kind of power is about to get unleashed.

Absolutely. I mean, there's a couple of things to unpack. Brian Armstrong had a great tweet. Says, welcome to the new members of America's most pro-crypto Congress ever. 219+ pro-crypto candidates and counting have now been elected to the House and the Senate. Tonight, the crypto voter has spoken decisively across party lines and in key races across the country. Americans disproportionately care about crypto and want clear rules of the road for digital assets. We look forward to working with the new Congress to deliver it. This was a day ago. So, you know, the full tally was not counted, but nonetheless, it is now up to over 250 folks. Yes, which to me, that candidly is probably more impactful, um, from a legit— because when I think about, to your point around what's been handicapping the industries, we don't have clear rules and regulations. And so a lot of resources have been focused on trying to get that. Every team that I've invested in spends at least 10 cents on every dollar that they raise on sort of legal advice. And, uh, forget about the things that they haven't done or the, you know, the design space that hasn't been explored, because there's just things that we haven't— not because we, we don't have the imagination to innovate, but it's just you just don't know, you just don't go there. Um, and so I think it's, uh, it's going to be really exciting to see that. Um, of course now It puts a lot of emphasis on delivering and executing at the project level. I think that's another point that I wanted to make. It's great. It might take a little bit of time, but if you're a founder in this space, then accelerate. Right now, it's fully on you to build, to execute. And I think that's really liberating. But yeah, the other thing I want to point out is Polymarket. Amazing what they've done. I think I had the privilege of meeting Shane very early on in his journey, invested when I was at ParaFi. ParaFi has become one of his key partners, but it's just been amazing to see how Polymarket has become the news. And that was the thesis back then, you know, the prediction markets, you know, surface the truth and are higher signals when you put money on the line. And it was very interesting to see. I mean, I think they had a great tweet to the effect of, you know, like the Office meme, which is corporate wants you to identify differences in the two images. And it was Polymarket's October '24 prediction of the election outcome and the real outcome. And it was like the same. It's like the same picture. And I think that just goes to show how powerful that was because Everyone got it wrong. I was tuning in on even Bloombergs of the world, they got it wrong. Either they have a lot of bias because they spin on one side, they're either very pro-liberal and they don't like to report things as they are. But now we have what is a more credible source of truth in real time, combined with Twitter being owned by Elon, which is surfacing a lot of these insights. And so, I think that was just very, very powerful to see. It was also the fact that it didn't go down. You know, it's pretty amazing as well. There's a lot of volume on the line. And I think it was very, very good to see that. I mean, I think, again, yet another crypto application that is providing a lot of utility. We talk about stablecoins a lot. Prediction markets for this election were essential. So shout out to Shane and the entire Polymarket team for just becoming so embedded in the election and really showcasing yet another, another use case for crypto that is really useful for people. So that was, that's pretty awesome to see.

Yeah, I mean, the success of Polymarket then, I mean, Robinhood just launched prediction markets as well. Like, this is it, you know, I was watching, flipping between, like I said, MSNBC, CNN, and Fox, and Fox was I mean, Fox basically turned, turned off their coverage for a little bit and was just showing Polymarket. Like, yeah, you know, one of the real— I've really fought this, what I'm about to say, for years because I'm a real believer in media. I'm a real believer in journalism and, and strong reporting. And I probably underweight the impact that Polymarket and Twitter has on the world. And I have for the last couple of years because I'm a real believer in media. With that caveat, one of the biggest losers of this election is mainstream media. Mainstream media just, you know, if you don't think that they are— I almost am. I'm still in the processing phase of it for me. Like, I think I have come around to this later than most people have because, you know, running a media company. And I think, I think actually there's— I want to make a clear distinction between like what I'd call niche or B2B media and then mainstream media. And mainstream media just completely, completely flubbed it here. I mean, they just, they just missed and they missed really badly. And I've been reading the coverage after the election specifically, mainly from The New York Times and from The Atlantic. And they're continuing to miss. They're just continuing to say, you know, half the country is misogynistic and sexist. And that's why— that's why the Republicans won. And it's just really polarizing. It's very polarizing.

The point, because people like my mom was getting alerts on her phone. You know, I landed and I'm with my parents here this week and she was like getting notifications from New York Times. Only mom, just turn them off. Like, just look at Polymarket. I was like, I'm gonna win. She's like, you're really calm. I'm like, he's going to win. Like unequivocally, I've been telling, like, for me it was, it was a no-brainer. Like I just never, like, obviously the odds kind of fluctuated a bit, but I mean, um, for a variety of reasons, I just felt he was going to win. But the, the, the media coverage, like, you remember what I told you when I invested in you guys?

Yeah.

A big part of my thesis was you have an opportunity to create a new media company and show the world what that could be. And That might be through different mechanisms that you can leverage some elements of crypto to create just a better organization. I think eventually you have to wonder, like, is there a probability where you turn into— like, there's a very good— there's a couple of paths here. One, that you continue to grow and the path towards growing is becoming very polarizing and clickbaity and appealing to a particular constituent base. Is that the right path? That's certainly what, like, the New York Times and even Fox, like, they become very political. They become very biased in their reporting. But there's another avenue here where you can actually— like, growth is not incompatible with being objective and being balanced. And I think you guys have proven that over the last 2 years. Like, you have been— I go back to that moment where one of your reporters published an op-ed piece. I forget it was about—

not a reporter, an opinion writer.

It was an opinion piece.

My bad.

And you guys published it. It was controversial. Most people didn't like it. But, you know, opinion pieces are important. You should be kind of doing that. And so I think it's been— from my standpoint, I think it's been very refreshing to see you guys kind of try to build and restore some of that balance in reporting and media organizations. The question is, as you keep growing, like, can you Can you like avoid that trap that every influencer, every large organization, some says in order to continue to grow, you need to resort to these clickbaity things?

Why?

Because I don't know, for a variety of reasons. If you're an influencer, you know, the value that you get, you know, it's a very small percentage of the cut that you get from YouTube and Instagram and all these things. So in order for you to kind of, it starts with very pristine content and then over time it just gets co-opted and you have to do brand sponsorships. And, you know, all this stuff. Is that really bad? No. Is it objective? No. Um, so as long as you have proper disclosures, right? So anyways, I think that, um, I'm optimistic. I don't think media— let's just be realistic— media organizations will continue to have a really big influence in the world and how people consume information, right? Um, but you now have prediction markets that surface the truth and can at least be, can at least be a, a thing that you can point to and say, no, actually, well, how do you reconcile what you're reporting and what's the market's telling us, like, how do you bridge that gap?

Yeah. So, you know, yeah, like, I'm actually very excited to work closely with Polymarket in the, in the coming years because I think that the media and prediction markets serve two sides of the same coin, which is trying to get to the truth. So what media is really good at is actually contextualizing something like, again, not the New York Times and the Atlantic of the world anymore, but I think like someone like Blockworks, like our our editorial team, I think, I think is probably the best in the industry and really, really, really good at what they do. And they're very good at contextualizing things and adding like background and like thinking through things and like and sourcing things and actually just reporting on the facts. What media, just because of like what media is worse at, is quantifying, quantifying the future and quantifying the facts. So media can add context, but it's very tough for media to be like, there's a 71% chance that Trump is going to win. And you saw The New York Times start to try to do this, which is like their, you know, little— they had a like The New York Times needle, they call it. But, you know, they completely, they completely whiffed on that. But that is them trying to quantify the future instead of just adding context. And I think that is where But the problem with that is it's just an internal team of people there doing that, or it's some model they've built. And what you need are the free markets quantifying things, dollars backing, backing the predictions. And so, like, I think the future will not be, oh, it's only prediction markets or, oh, it's only media. It's these two things kind of working in tandem where the prediction market helps quantify the news and the— You triangulate, you contextualize.

Yeah, I think you triangulate on the truth. But in a world where you don't have prediction markets, a world is better in a world— the world is better when you have prediction markets to at least fact-check, to focus the discussion in this podcast and in other— there's a lot of debate around, well, which prediction market's better? There's a big divergence that we talked about in the prior episode. Well, who's right? PredictIt says one thing, Polymarket says another. There's a big gap. Trying to explain that gap is useful. That's where we should focus the conversation. The question will be, of course, what is the future viability of a prediction market? The election encompassed a lot of volume. You do need to have— for prediction markets, I think, to surface the truth, it goes back to this great book called Wisdom of the Crowds. And in order for the crowd to surface the truth, meaning a market to surface the truth, I think you need to have sufficiently large number of participants that are also heterogeneous. Meaning, if you all have left people— in an extreme scenario, you have— imagine it's a soccer match, who's going to win the Champions League. Well, if you have all Real Madrid fans only betting on the market, and if you have many millions of Real Madrid fans, well, obviously that, that's a very, um, homogeneous market— large but homogeneous. So that skews it. So that's not surfacing the truth. What you want to have is a sufficiently large n, like, number n participants in the market and dollars backing it across a very diverse group. That surfaces the truth. That's like the criteria that I think is Jim— forget his last name— in Wisdom of the Crowds. So that would be interesting to— maybe this is like from a product idea of Polymarket. It would be useful for them to kind of maybe try to quantify that. And so because there's a lot of different markets, people can go to Polymarket, you can pull it up, and they have on all kinds of stuff, sports, discrete events and whatnot. Some of them have very shallow liquidity. So Is that going to be useful enough? Arguably not. Yeah. But I think it still, it still allows us to— it's still better marginally, irrespective of whether it's sufficiently large or heterogeneous. I do still think that it is a good thing to focus on, just to, like, for a conversation starter to say, well, what's the delta? Like, why is this phenomenon occurring?

Right. Yeah, the last thing and then we can move on from this is if you— the context that— so I think people think of just media as news stories, but like I'm really, really, really bullish on podcasts and newsletters, obviously, as people know from Blockworks and Empire and stuff like that. But like, you know, we didn't cover the election actually that closely relative to some other Blockworks channels, but we have a show Forward Guidance and like Quinn Thompson and Tyler and Felix, who's the host of Forward Guidance, like, if you listen to them, you would have made a tremendous amount of money. Like, they have been so early and so right on the Forward Guidance podcast. And actually, the other thing that I missed out on mentioning was like, I was just plugged into that. We, we launched all these Telegram channels across the Blockworks, like, podcast. So there's an Empire channel, we can link it in the show notes. There's a 0xResearch, there's a 1000x channel. And I think the best source of information for me during the election was actually the 4th Biden Telegram channel. So yeah, that's true. So anyways, yeah, let's, let's get into crypto. Well, how do you think about just how are you repositioning your portfolio? Are you rethinking your investment? Are you— do you feel like you're perfectly positioned? Do you think, you know, I mean, it was interesting looking at what went up, right? Bitcoin went up like 7%, ETH went up 5 or 6%. The meme coins went up like 15%, Coin went up 20%, and the DeFi tokens, like the probably blue chip DeFi, went up like 15 to 20% as well. So how do you know some of the L1s like SUI, Aptos, Solana, Avalanche went up 10 to 15%? Like, I think there's a really interesting thing to do, which is look at the performance in the first 24 hours which should actually, I think, give you some signal into what will happen over the next several months. So I'm curious how you're thinking about this.

I didn't make any changes. I was very well positioned coming into it. I was as long as it could get. And so I was fully allocated. So as we were recording this, Bitcoin is at an all-time high of $76,361. ETH is at $2,800. Solana is about to hit $200, it's at $194. Um, and so yeah, I think you're right, it was really interesting to observe which ones, uh, rallied the most. Um, particularly DeFi tokens. And I think there's a category in CoinGecko that talks about like SEC securities. I want to look at that and how that performed. Let's, let's go quickly there. Um, categories. So CoinGecko has a nice filter, says categories. And there's one that, uh, in particular that I'm really curious about. Um, apologies here, where is it? Alleged SEC securities. That includes Solana, Tron, a bunch of others. So that was, that was up. I'm pulling it up here for one sec. That was up over the last, um, Oh, over the last 7 days, that's been up quite substantially. Um, and that includes SOL, BNB, Tron, Near, Filecoin, Matic, like, and then you go down the list from there, you know, a lot of DeFi tokens.

So these ones are— these are up actually less than, you know, like Filecoin's only up 6%. Near's only up 4%. TON is only 2%. Tron's down 5%. The things that are up the most actually tend to be—

well, memes are up the most, right? The memes.

Yeah, the memes and DeFi. Like, Lido is up 12%, um, right?

Oh, on the— you're quoting 7-day, not 24 hours.

Yeah. Oh yeah, you're right, you're right. Yeah, well, it's more than 24 hours is the thing, but yeah, yeah, yeah, absolutely.

I mean, I think it's, um, though, I mean, everything is going up, right? But I do think, uh, so what I—

of course, I, uh, if you look at Aave, Aave is up 30% in the last 7— 28% in the last 30 days— in the last, uh, 7 days, excuse me.

What's like— WIF is up— WIF is down, actually. On a 7-day period.

Why is WIF down?

I had no idea.

I mean, it was—

it rallied quite a bit from the bottom. It was like a $1.90 or so. Now it's at $2.38. Gold's up quite a bit. Yeah.

So Ryan Watkins had this tweet, um, or I can pull it up. He said, there's more opportunity, uh, single greatest setup for liquid tokens, uh, we've had since 2021. Global liquidity is expanding, regulation is radically easing, a potential U.S. strategic Bitcoin reserve could spark a sovereign Bitcoin accumulation race. Crypto is unambiguously becoming the election trade and will likely be the fastest horse in the race. A few powerful alt narratives are accelerating: AI autumn, SOL supercycle, meme coin mania, DeFi renaissance. How do you think about like, are you trying to pick any new winners right now? Are you relooking at things? Are you basically just sitting in your Solana meme coins, Coinbase stock and just kind of sitting on that?

Yeah. Yeah, I'm not, not doing— like, Chris Burniske had a tweet around like, if you've been sidelined, you have— the window on allocating is closing. And so yeah, he's had something to that effect. Yeah, actually, I actually would take the opposite argument here. And I responded to his tweet. I'll tell you why. We'll read his tweet first. I mean, he said, he basically said that It's a bit further down. Um, if you've been sidelined, you have a narrow window of time to fix your mistake. That was a day ago. My response to him says, I'd argue you have plenty of time because it's still very early, and this industry will grow much more than most believe. We're still at a point where most businesses don't appreciate how crypto works or how it can help them. I think you'll know we're no longer early when most businesses leverage crypto and yet their users may not even know it or care about it. And that's the point, because I do think that like many transformational technologies, crypto will be invisible but its impact will be felt. Like, again, going back to the discussion, like Polymarket was very visible, it was very useful for, for many people beyond the crypto kind of, um, what is still a very small ecosystem I would characterize, even though there's millions of users, however you want to slice it. But you know what I mean, like Okay, we talk about the biggest opportunity I think ahead of us is if you're a project, the design space hopefully just opens up dramatically in the things that you can explore and the way you design your token economics. And then the inverse of that is, or the alternate point is, a lot of businesses have been sidelined, like from people that want to invest in the asset class. We've heard it from multiple institutions like BlackRocks of the world, like a lot from an allocation perspective, many banks RIAs can even— most of the flows into ETFs are still self-directed accounts or not managed accounts, meaning the banker's not calling, can't recommend an ETF product. But I'm quite excited, obviously, from my vantage point. And what I'm trying to do now with the fund is you ought to wonder how many businesses I think at this point understand this, have a good sense of what crypto can do for them, but they haven't really been comfortable getting involved because of the regulatory lack of regulatory guidance and clarity and a very hostile environment, right? So I mean, I think it— this is a perfect setup. Obviously you can play it in the short term. There's a huge— I think the markets continue to, you know, I would sort of agree with Ryan's take and Chris's take, like, you know, it feels like 2025 is going to be a great year, uh, for a variety, variety of reasons. But if you extend that to 5 years, 10 years, like Yeah, a real shot that, that— I mean, you mean like it's not a $10 trillion opportunity here. If this really works, it's going to be way bigger than that.

SKALE is the blockchain that is simply built different. Let's face it, other L1 networks have costly transaction fees that increase as the network gets busier. SKALE has solved this problem with a gas-free, scalable infrastructure where users never pay gas fees. SKALE was awarded the most active gaming chain in 2023 by CoinGecko and hosts 5 of the top 25 games on DappRadar. You should definitely check out SKALE. I was using it the other day. It really is incredible to use. That's SKALE spelled with a K. Hit the link in the show notes or head on over to scale.space/eco to get started today. Hey everyone, Jason Yanowitz here. I wanted to quickly talk about Kronos zkEVM, a next-generation zero-knowledge layer-2 blockchain network focused on scalability, security, and innovation. Secured by Ethereum, it further expands the Cronos ecosystem using zkSync tech. Cronos zkEVM has launched its Pioneer Program, offering early users loyalty points for engaging with Cronos zkEVM and its dApps. Join the first quest by depositing CRO in the Cronos zkEVM bridge to receive zkCRO and loyalty points at mainnet launch. And that's not all. In addition to receiving zkCRO and loyalty points, you could also win part of a $30,000 zkCRO giveaway by depositing in the bridge. The more you deposit, the better your chances of winning. Visit zkEVM.chronos.org/bridge for more info. Now let's get back to today's show. Are you a project founder struggling to pay your team in stables or even just giving them token grants? I've seen this issue firsthand throughout the space. Traditional payroll or EOR providers don't support crypto. Even if you wanted to do it yourself, it's really complicated to figure out all the tax withholdings, report to the IRS or any government, and manage local filings. Toku simplifies every part of global token compensation. Everything from paying full-time employees in stablecoins, issuing token grants to your team and investors, all in 100 countries on one platform. You can plug Toku into your existing payroll setup or even choose a fully managed service. No guesswork, no missed deadlines, no complexity. Reach out to their incredible team at toku.com or by hitting the link in the description of today's episode. Let's face it, building on crowded L1s or expensive L2s is just not going to unlock the next generation of applications in crypto. That's where Supra containers come in, offering a completely new solution that transforms your development control. Imagine dedicated, customizable app spaces running on Supra's 500 kTPS Layer 1 blockchain. You get complete control over gas tokens and fees with the freedom to use your own token, create local fee markets, or even go gasless. Scale on demand and build with better customization than appchains. All at a fraction of the cost. Plus, with multi-VM compatibility, you can easily deploy your EVM, Move, and SVM smart contracts. It's time to rescue your projects from the costs, complexities, and fragmentation of traditional solutions. Get notified when Supercontainers are ready for builders at super.com/containers. Earlier in today's episode, I mentioned Ledger's latest products, the Stax and Flex, and I wanted to take a few seconds to tell you more about them. These wallets feature the world's first secure touchscreens, which don't just simplify your digital transactions but also keep them extremely safe. These wallets are virtually impenetrable to online attacks because they store your private key in a secure offline chip. You can manage more than 5,500 tokens and install up to 100 apps. Choose the most trusted name in hardware wallets and take control of your digital security today at ledger.com, or hit the link in the description of today's episode to check out their latest wallets. So I think you both are right. Chris is probably right that we're entering the stage of the cycle where things get really frickin crazy. Like 2025 could be really, really, really crazy. And like, do you really want to be buying if you're kind of trading the cycles, you know, do you want to be buying Bitcoin at like $120K or something? Like maybe not. Like late stage cycle if you're holding for a decade. Yes. What I think nobody is thinking about is we had a massive out— what's the opposite of influx? Departure of developers actually to AI about a year, maybe over the last 2 years. And what you're about to see, I think, and we're kind of positioning for this with— we just announced Permissionless 4 today, which I can— I know you're probably 7 AM there right now, so I don't know if you've seen it yet, but we're bringing Brooklyn. Yeah, we're bringing it to Brooklyn. Well, you already saw it. Yeah, okay.

Um, we're up by 5 AM. What are you talking about?

Yeah, you're out here.

I'm drinking great Hawaiian coffee. This is—

this is the thing that nobody is— that looks, that looks phenomenal, actually. Um, the thing that nobody's thinking about, or I just haven't seen people talking about, is what happens to the industry when you get a 10— when you 10x the number of developers. And these aren't crypto developers, these are Shopify developers and Stripe developers and developers coming from traditional capital markets and from, from Airbnb and from Facebook. And look, it takes them some time and maybe they're not as— what they, what they lack on the crypto nativity and the ability to launch a token and have that token go up, they make up for and more in their UI, their UX, their ability to think about customer acquisition. And yeah, just build a really good consumer product. And so I think people forget what happens when you 10x the number of developers in an industry, and that is about— that is much more important in 2025 than the price going up in 2025. We are about to 10x the number of developers.

We hit a— just an all-time high before the election, and maybe the market was feeling that. I'm talking about Bitcoin. Um, it's sort of like we've gone this far in a very hostile environment, no matter how you want to talk about it. Lance Vance from Framework had a great tweet around how difficult it is to run a US-based investment firm in crypto. From one day to the other, and I've seen it, your bank account gets shut down. It's very difficult to have service providers. People constantly discount you. So, from that standpoint, it's very hostile. Most teams left the US and went to Dubai, they went to Singapore. They've just gone even to London because that's marginally better. So, I mean, certainly, like, you're going to have more developers coming into the space. But from my standpoint, like, there's a lot of really good tech that's been built. It's just, it's just it hasn't been adopted because it's legal.

It is legal to work in crypto now. Like, it's, it's been, it's obviously been, you're not going to go to jail for working in crypto, but they make it about as hard as, as you can make it to work in an industry. I mean, everyone was getting debanked last year. It's hard to set up a fund. You can't accept tokens. Everyone's setting up these Cayman entities. There's no rules around how to issue a token. Like, it is damn hard to operate in this industry. Even hosting conferences. Look at all— like, Consensus used to be the flagship US conference. They're hosting their event in freaking Toronto next year. Yeah, like, they left the US. And so here's a—

here's a— here's an interesting take that I agree with with Xiao. Um, he said if Trump wins, ETH loses its regulatory moat. Mind you, ETH— he's referencing ETH has been dubbed as a non-sec— like not a security, accelerating the timeline for the SOL/ETH flipping. We actually agree with— it's interesting take. I, of course, have talked about Solana flipping Ethereum because I see more developers, I see more activity there, some of the— like the slope of the curve. And if you go listen to the debate that I had with Avicii, Avicii was actually the one that described it like this. Shout out to Avicii. He said the slope of the curve because they put out the developer report. There are more developers in Ethereum today. There's more TVL in Ethereum today. But the slope of the curve is what you want to be looking at is from the best new teams are building on Solana, the best, most exciting projects are building in Solana, more users, the newer users and developers entering the space are going to Solana. One of my portfolio companies, Time.fund, just announced that it was going to move over to Solana. There's plenty of examples like GeoNet, some of these projects, they all realize the activity and the attention is in Solana. Because it provides just a more seamless, frictionless experience for the user. So, actually, Xiao framed it from that lens, which I thought was interesting, and I agree with. So, Solana responded much more than Ethereum after the election. Solana is now— it was like at 160, now it's close to 200. Ether has gone up as well, but Solana— like the SOL/ETH chart, pull that up. I'm not a chartist, but I do appreciate—

I'm not a chartist, but when I see the SOL/ETH chart going up, I will want to—

I'd be remiss.

Look at here. Let me get out of the prices for a second and show you what I think is more interesting, which is not actually— I tweeted this. I said US Congress is back. So Toly tweeted Breakpoint USA 2026. Jill said, hear me out, DEF CON 2025. And Rushi said, can we finally have more conferences in the States yet? And the thing that is interesting is, I mean, Santi, you've been in— how long you've been in the industry? A decade, right? Every 2 years we ebb and flow between Asia and the US. Asia and the US. It's like, you know, US is super hot, US cracks down, everything goes to Asia. Then China does the Bitcoin mining ban. Everything come back to the US. Then FTX blows up, Gensler cracks down, everything goes to Asia. And this marks the US is back on, I would say. The US trade is back on. People are reminded that New York is the crypto capital of the world, the hub of all the, you know, of all the capital. And I just think that's good, net good for the industry and net good for the United States. Like, it doesn't make sense necessarily that this industry should— I mean, I'm biased, I'm a US person, but like, it's a good thing to have a strong and vibrant US ecosystem.

Absolutely. The US, in my mind, like, when people ask me where I'm from, I identify American. I'm not American, but I identify American because it's the best place in the world for two reasons. One, it has a system that works.

Why?

Let me elaborate on that. Crypto, you've still had a very hostile You know, the branches of government, what makes a democracy great, you know, you have executive, legislative, and administrative. You know, even in a very hostile administration, you still won most of the biggest, most important court cases. When it went to court, then the constitutional interpretation of things, like, there was a bedrock there. Like, you— and we have talked about it how many times in this podcast— is you have to believe in the court system, because if the court system fails, and it fails in many other countries then that's a problem. So no matter who the executive is, no matter how the administration, the legislative composition is on one side of the aisle or the other, you believe the courts will interpret the Constitution and the key values and principles of a country and what it stands for. So I think from a systemic standpoint, countries are great from that reason. Like, the interpretation of the law needs to be sound and predictable. It has been in the US for crypto. I appreciate it's been very regulatory, like the hostility has been at an all-time high, but the courts have ruled in the favor of Ripple. What is it? DCG, Grayscale, right? You have the ETF approved. We had to sue the 3-letter agency to get it approved and we won. You know what I mean? So that's really powerful. And the second one is just from a cultural standpoint, like it is a place that it is aspirational still for most people around the world. Like you go to the US. Because people care more about what you think and what you stand for as opposed to where you come from, if you come from money or not. And you can actually fail, and people allow that. There's so many cultures where it's not very pro-innovation because as soon as you fail, it's like seppuku, like your family, it's a disgrace. And I'm not going to name the countries, but there's many cultures like that. And so I think I came to the US and for me it was the biggest opportunity that I had because you are in the most competitive markets, whether it's New York, whether it's elite institutions. And also, people care more about what you think. And that's so refreshing, incredibly refreshing. People that don't appreciate that live in the US, go and travel, go meet people, ask people, ask immigrants where they come from and how they're treated in their country culturally. For that reason, I think America, in my mind, has always been the greatest country, for at least of our generation. Uh, is it on it? Is it, is it at its prime and peak? No, but I'd argue where this is a big inflection point to recover marginally what it lost. Um, and I'm really excited to see that. Heck, I'd move back. I told you this, I'd move back. I'm not sure I'm going to move back.

You think you'll move back?

Said differently, I have, I have office space here. I have office space in New York now.

Let's go.

That's where, that's where most of the people that I'm hiring are going to be based. The strategy and most of the businesses that I'm already looking to acquire are based in the US.

The other thing that people haven't mentioned is the IPO market is going to open up. It's been really tough to raise money as a crypto company. I mean, we're not raising, but like talking to a lot of founder friends, if you are a seed and Series A, like you've probably actually had some success the last couple of months, but Series B, Series C, and Series D are completely hamstrung from fundraising right now. And there's two reasons for that. One is the IPO markets are closed. They've been, they've been closed.

But they've never been open for— they've never been open for crypto companies, really.

They've never been open. It's more of the companies working big enough.

The last fundraising environment has sucked. You haven't really had new money come in or being allocated to crypto funds.

Well, all the funds are really struggling to raise, as you know. There are some, some tiny fundraisers happening right now with, with these funds.

I think most of the success have been like sub, sub $100 million funds. Some break in like $200 million. There's few that have raised more than that.

So there's just no new money. And, um, you know, uh, 10T, Dan Tapiro and 10T led our last round. And I saw that Dan said something on stage at an event yesterday, said they got like 30 to 50 inbounds yesterday from, from folks. And, you know, we had our board meeting this week and he was saying similar stuff. Yeah, just about like what would happen, which is there's a lot of allocators who are now on the sidelines, just woke up and they can't allocate to the liquid crypto markets like they're not just buying Ether, Solana, Bitcoin. So they need to allocate to these funds. That'll take them, you know, what, 6 months to do. And so there's actually this, like, there's a real lag in the fundraising markets from an event like this. And so it's— I would watch it, you know, maybe we'll see it like end of Q1 going into Q2. Like, I think you'll start to see—

it might be sooner than that, actually. Well, what's different now, of course, is, well, to what I'm thinking about is how many of these allocators haven't allocated and were waiting for the outcome of the election, waiting for, you know, and so now that that's been resolved, where are they going to allocate? Are they going to buy an ETF? Did they do that before the election? And how much of their allocation of crypto from a portfolio standpoint is going to go to funds? Historically, it's been this idea of like, I'm going to allocate in a fund and that's how, you know, I'll let them handle a lot of the complexity. And now you have an ETF in the picture, right? But we've had it for a while. I think, uh, the ETF— the people that were on the sidelines, I would argue more of that capital will flow into funds, less so on a marginal basis into ETFs, because people, I think, for the most part kind of like were comfortable buying the a Bitcoin ETF, maybe an Ethereum ETF. Um, but you're right, I mean, we should, we should track flows. But I, I do think I got like 2 or 3 emails from different funds. They're like, we're opening the subscription window all of a sudden. And you're like, yeah, of course you are, which is good, you know, like, yeah. And I think they're— and I think to your point around Dan and 10T, like, a lot of them are getting inbound interest from people that, that were just waiting for this to be resolved to then saying, okay, I want to do it. I do want to have exposure and now I want to find the right manager to do that for me.

Yeah, yeah. We just talk about this, how crazy thing. I have two friends who are down in Mar-a-Lago and actually, well, I'm not going to— I mean, basically Trump was just saying extremely bullish things about crypto to them. Um, like outlandishly bullish is what I would say. Uh, just outlandishly bullish.

Listen, if even 5% of what he said about crypto is true and actually follows through on it, I mean, it's a huge risk.

So like take the bit— yeah, take the bit, you know, Bitcoin went up 7% overnight, but take something like the Bitcoin Reserve. So as a reminder, the Bitcoin Reserve was introduced by Senator Lummis back in June, I think. And basically what the Bitcoin Reserve means is you would use existing funds at the Fed and the Treasury to purchase 1 million Bitcoin, which would make the US the largest—

1 million units of Bitcoin.

Units of Bitcoin, which would make the US the largest nation-state holder of Bitcoin, give us about a 5%.

It still is because of the seized Bitcoin.

Yeah, good point. Okay. It would give us about a 5. That's a good point. But it would give us about a 5% ownership of the network, which people are like, oh, they would never, they would never do something like that. Well, newsflash is that we are 5% ownership of the network is about on par with our stake in the global gold supply, actually. So this would get us on par with where— with our ownership in the gold supply. And, you know, if you look at where we're at as a country, We have $36 trillion in debt growing at about $1 trillion every 100 days. All roads seem like they're leading to inflation. There's a risk of losing the status as the global reserve currency if that keeps happening. And if you have a long-term outlook here, like everything from a macro perspective signals that you should increase your exposure to risk assets. I don't think it's really crazy to think that Trump might actually follow through on something like the Bitcoin Reserve or shutting down the ability for the U.S. Marshals to sell their, their seized Bitcoin. Yeah, these kind of things that it's like, it seems like these outlandish things, but now that it's actually happening, I mean, the head of his transition is Howard Lutnick. Howard Lutnick runs Cantor Fitzgerald, who banks Tether, right? He owns personally hundreds of millions of dollars of Bitcoin. It's just like, I don't think people are really understanding how, how insane this actually could get.

People ask me why I still have crypto is because I tell them very concretely, I am of the mind that I'm earlier now than I was before, because you see the impact of starting to work in many things that perhaps before I didn't appreciate. And the second, I think, uh, it's sort of this quote by Bill Gates, which is, we tend to overestimate what happens in 2 years and grossly underestimate what happens in 10. And I appreciate we've been at this for more than— since the financial crisis. But I genuinely think that this is— I think most of the markets and people's imagination doesn't go that far. So you stop believing because if you've been in an environment where things have been slow, and not all of it is attributable to a regulatory environment that has been hostile. But you become tired, you become more skeptical. Heck, you become cynical. And it's really important. In my time in crypto, it is so important to check yourself in the mirror and say, have I become cynical? Because you got to remind yourself of why you came into the space. You got to also re-underwrite your thesis as you're doing now, perhaps with this. There's new information, there's a new environment. You should re-underwrite the thesis, but go back and remind yourself of observe, talk to founders of what's working. And again, it's like invert and say, if it's been working and we've gone this far with the tech not being as great, that was like, or with the regulatory environment's been hostile, the combination of all that, but you have some really powerful, really useful pieces of tech like a stablecoin or like a prediction market, or then you wonder like, okay, yeah, yeah, this can actually, this this can actually be way bigger than $10 trillion or way bigger than digital, like a gold market cap. Yeah. How much value do you think gets settled on the fucking internet? How big do you think that is? You mean like that's not $10 trillion? Sorry, I hate to break it. It's way bigger than that. Now, is it going to take— like, the challenge is always like markets always get ahead of themselves. And maybe that's Chris's point. Like, you got to underwrite that. You got to move before others do. Um, and a lot of the big moves in prior cycles have been, you know, you had to, you had to be allocated. Like, the difference between allocated in like a month before Compound launched liquidity mining and the month after was the difference between a 30x and a 20x or 15x or a 5x. Like, it was months. And so is that gonna, is that gonna be different this time around?

I don't know.

Markets do react very violently. But man, I just, it is still kind of crazy that money can now move kind of at the speed of light. And, and that's just— we're talking about this, most people like don't appreciate how limited the investment opportunity is for people outside the US. They cannot buy Apple stock. I've had this belief that perhaps the most amount of money in this space will be captured by people that aren't in the space today. But will be in the next couple of years because they, they're coming at it from like that fresh perspective that you came at it like when you started in crypto. You're like, holy shit, this could really transform the internet. But, you know, you spend enough time to get rugged a few times, you get frustrated, you lose patience, you become cynical. But I think the whole theme of this episode, the narrative is I think you ought to rewrite your thesis.

And I think that's a really good point. I mean, take something like tokenized stocks. Like, that will happen. But if you've been in the industry for as long as we have, you hear that and you're like, oh my God, you don't get it.

We have Mirror and Synthetix.

You don't get it. Everyone's tried that. Does— doesn't work. Someone will come and do that. Someone will come and do that. Or here's another one. I want to move these freaking election— I mean, thank God it wasn't a close election. Because, and, you know, thank God it wasn't a close election because if it was close, I mean, the next 3 months in this country would be, would be total hell. Like the election fraud and the votes getting recounted. Like, we got to move these, we got to move these votes on to a damn blockchain or something or some better system. Like some entrepreneur who's never worked in Colorado.

Colorado did this, a pilot.

I know everyone piloted these things, but like all these, like, all these entrepreneurs in crypto who are the really good entrepreneurs, including myself, would be like, that's been tried before, you can't do that. And some, some entrepreneur out there is going to be like, oh my God, we got to fix this.

What makes sense? Yeah, what makes a great founder? You and I have listened to so many founders. You're a great founder. What makes a great founder? I'll tell you what I mean. I'll tell you why. I think The best founders need to be like maniacally obsessive about a particular idea combined with some naivete of how—

I was gonna say naive. You have to be naive.

You have to be naive enough to not fully understand how difficult it's going to be, but you have to have both the ability to take extreme pain. That's a quote from the Four Seasons founder. Excellence is the ability to take pain, right? That requires a maniacal obsession about, you know, right now I'm obsessed about friction in systems. It pisses me off. Every hotel, every interaction that I have, I'm like, goddamn it, there, there has to be a better way to do fucking things, you know. So you're maniacally obsessed about something. You're obsessed about media and the frustration with it. But you also have to be naive enough about how difficult it was going to be. You have to keep at it. So your point is, that is, it almost requires, if you've been in the space long enough, you probably lose that sense of, you know, naivete. But you have to be kind of new coming into the space and say, well, shit, why are we counting votes with paper and all this crap? Like, there surely is a better way to do that in an immutable ledger, right? Right. And he doesn't know that there have been like 30 pilots. Like, I'll give you an example. What I'm talking about, mistakes I've made in my investing. Trajectory, uh, which is not very Luminary, but nonetheless, uh, I passed on Helium. Multicoin was like an early investor, and they came and said, hey, you want to participate? I was like, this has been tried way too many times in Web2, like, why is it going to be any different? And it was that, you know, sometimes— or like, a lot of people passed on DeFi because they said Uniswap. Oh, you must not know centralized order book models if you're a finance guy. Centralized order book models will always be superior. I'm like, yes, but let's talk about, you know, some of the benefits of an AMM. So anyways, yeah, to your point around developers, I think in a perfect world you want to understand out of the new developers, how does that quality compare relative to prior cycles or prime? Like, is the quality not just the number of it, but the quality of the founder? Where are they coming from? Are they the exceptional founders? That in moments of time in this industry have come from the likes of Google and the top Web2 kind of companies, are they entering the space? And where are they building? Which ecosystem? Which application? Now, all this to say, some of these founders are not necessarily the best because historically, it's been very difficult to build in crypto. And a lot of the same founders that came from Stanford or some of these elite companies ended up— were the ones that ended up leaving the fastest because they lost conviction and they knew that they could just go and find another job, right? What I'm trying to say is I think most of the people that pivoted to AI or left to space in like in prior cycles were these guys that like, or, you know, um, that came from the, the Googles of the world and like they lost really quickly.

Yeah.

Uh, so anyways, um, I'm not suggesting that everyone on Google and Stanford is soft, but You got to have a lot of grit in this space and a lot of ability to take pain. And, and so anyways, it's not easy.

This week I saw two pictures that made me think of you. I will show them to you.

Oh boy, here we go.

No, no, no, this is one of them. Due to rising costs, all non-cash transactions will incur a 3.5% processing fee. Wait, here's the other ridiculous—

where is that, New York?

Um, yep. And then the other one was, uh, my local, uh, bodega. Cash discount, 2%, baby. So friction in the system, got 2 to 3.5%.

This is my calling. I'm like, I'm just obsessed the same way that you are about media and transforming that. I'm obsessed from a This— there ought to be a better way with just friction and systems. It's crazy.

You want to see something else that's wild? Just because I'm sharing my screen and it says nothing about crypto, I went to, uh, wait, is this a crypto pod? I went to a butchering class. Oh wow, this dude Gary taught us how to butcher a full pig. Isn't that crazy?

Wow. Well, Who's on the chopping block?

I tried to— I was going to tweet it. I was like, Pug Pig Butchering Golden Bull Market. I was like, this has nothing to do with—

You're just stretching. You just saw something that was really— is this really your first time you've seen like this, like the sausage-making process?

I'd never seen how the sausage is made. Yes.

Yeah. Yeah. Well, definitely avoid it. Fascinating discussion. We're both up at 5 AM.

Have you watched the permissionless launch video? If not, I'm going to show you it. It's 30 seconds.

This is Brooklyn, what?

It is. Can you hear the sound? Yeah, I can hear it.

Nice.

I'll be there.

By the way, great song. Great song.

That video— how good is that video? All right, what else is it?

I think that's pretty good, right? Anything else we should talk about?

No, no, go, uh, I'm sure other people have much better— if you guys want an actual political take of what happened, uh, in this election and like an actual debrief of like red versus blue type of stuff, um, I'm sure Quinn and Tyler and Felix are going to do that on the Forward Guidance podcast. But yeah, that's it. Bullish crypto, bullish crypto in the United States. And just, yeah, if you, if you have made it this far and you've been listening to Empire for a while, like, small tap on the back for getting to this, getting to this place. And I know a lot of listeners, like, it was your first real cycle. And a lot of you guys came in in the last cycle, maybe, and braved it through 2022 and 2023. 3 and got to this point. And yeah, just grateful for all you guys for—

we have a Telegram chat. There's some activity happening there, so you might want to join that.

And there's some activity happening there. Yeah, we, uh, let's put a link at the very top of the show notes, make it easy to find. We've got 362 folks. We have, uh, somewhere between like 10,000 and 15,000 listeners per episode here, so we gotta We gotta pump those numbers.

Yeah, those rookie numbers, let's pump them up. Ladies and gentlemen, if we're not at 50,000, I'm quitting this. I'm, I'm gonna be, I'm gonna be way busier going forward, by the way. I mean, I was busy before, but we need to get 50,000 or bust. 15,000, 50,000, and that's like selling short.

Boss, yeah, we go, um, great, great. Uh, we released the Zach episode on the day of the election. So I would recommend going and actually listening to that episode if you guys missed it. It's, uh, Zach, the founder of Bridge. It's his only interview he's done since selling the company to Stripe. Uh, so I'd really recommend going to listen to that.

For sure. Yeah. And by the way, thank you for the feedback. I know a lot of you have DM'd me. A lot of people really like that episode. Um, and this is one of the most diehard listeners. He always sends me feedback on episodes. Um, So again, now is your chance to share feedback live on the Telegram group or on YouTube or on Twitter. We are listening. If you like stuff or you don't like stuff that we're doing, please let us know. We appreciate it.

Cool. Cheers, folks. See you Tuesday.

Thank you, guys.

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