Why We're Uncomfortably Bullish on Crypto | Roundup

just to share like how I am uncomfortably bullish at this point. I really am. I'm— I'm—

look at the man. Look at the man and his eyes. I am really fidgeting on the chair.

I really am. I'm coming back from Token and Breakpoint being like, these people online have no— are so disconnected from reality because the loudest people on crypto Twitter are the traders and they have been sitting in the midst of just choppiness for 6 months. And I am here. I'm in the trenches with 20,000 people who are building really cool shit. This episode is brought to you by Anoma, the universal intent machine introducing a new era of applications where you define the outcomes you want. To stay up to date with Anoma, you can follow them at x.com/anoma or sign up for the newsletter at anoma.net. Special thanks to Anoma for sponsoring 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. Supercontainers offers dedicated customizable app spaces running on Supra's 500kTPS Layer 1 blockchain, giving you complete control over gas tokens and fees. Get notified when Supercontainers are ready for builders super.com/containers. Hey everyone, I'm excited to tell you about FBTC, an omnichain Bitcoin asset being used throughout DeFi today. So far it's accumulated about $157 million in TVL, making Bitcoin more accessible and useful. Be sure to check out Sparkle, the rewards program where you earn points just by holding FBTC. Get started at fb bit.ly/TC.com/ongoing-campaign.

Sir. Well, what happened? Now we're not in a room and I look like a midget. Now we're at the same stage.

I actually got to make my chair a little taller here. You fucker. There you go.

Oh man, I'm fucking tall too.

Oh my gosh. Oh my God, okay.

Who's tall now? Right. I love cursing, by the way. So like, you know, if we— I don't know if we get like a little rating on Spotify that's like censored content, explicit content, you know, that sticker in CDs. Yes, I'm showing my age. Like adult, like explicit content, that little black sticker on the bottom. Yeah, that's—

I'm going to pull up the— I'm going to pull up the comments. While I'm doing that, how was the trip? How was the trip?

Yeah.

How was the Breakpoint and Token? And what did you think of Singapore as it wrapped up?

Oh, amazing. I tweeted about this. Two of the kindest things people have ever done to me happened this week or that week. This guy Kai published, here, actually, I'll show it to you. I was gonna say, I think my bookshelf might just collapse in itself, but he gave me this book. He now open sourced it. But for anyone that's viewing this, it's like Wrecked: Mistakes from the Trenches. He went by 0xChancellor. Now he's kind of still pseudo-anonymous. But anyways, he assembled this, and I think time is the best investment that anyone can give you. So he basically interviewed probably, I think it's like 50 of the most degen people in crypto and asked them, what are your top 3 mistakes? And then he assembled them, collect them, and then just publish, like created this book. And anyways, I had a really fantastic meeting with him in Singapore. He's based in— I guess I won't say, but yeah, we— then he dedicated the book to me. He's just— this book, I mean, he's— yeah, no one's ever done a book. Like, I guess I've made it in life. Jesus, it feels—

that's cool. What are the big mistakes? Have you read it yet?

No, I have. Yeah, of course I read it while I was in Singapore and then on the flight back. He published a great thread on it summarizing it. And by the way, people want access to the book. I didn't want to like force him to do it. I just sort of kept it. I didn't name names. And then he came out and said, yeah, I'll publish it. So he open-sourced it, but it usually runs around common themes. Leverage, you know, don't play leverage as a ticking bomb. Not forming your own thesis, selling too early seems to be a common error, which I sort of don't think is that big of an error. It's just sort of like, again, error process or outcome. But process errors are definitely leverage. You know, a couple of people obviously had hacks and, you know, FTX, money in FTX. Sizing is a common mistake that a lot of people really point to. So yeah, and then just listening to friends and like not doing their own research. Yeah, seems to be a common denominator here.

All right, so give us your— maybe tell us about how you're feeling about things. Market's ripping, right? So Solana's up 9% in a week.

Yeah, back up 5%. Now, oh yeah, WIF is back above $2. Maybe let's start there.

Where are you in terms of— so yeah, WIF is up 22%. But last you said on this podcast, you were— this is a couple months ago— you were thinking about trimming some meme coins. I'm not sure what you did there. So where are you sitting in with these meme coins? Did you end up taking the money off the top? Did you—

I did not off the top. I did take some size off. I put it back on. I'm kind of in my private books, you know, sort of fully allocated, so to speak. I've said this in my panels that I took in 2049. I generally think that the market's too focused on the election, and I think I am of the mind that it's— it is important, but I think people are pricing it too conservatively. And so, like, very binary— it's either going to be really good or really bad, and I think the money's in the middle. Um, and so I'm willing to— I was of the mind that I should— I felt, I felt compelled to put on more risk. Um, you're also seeing the Central Bank of China inject more liquidity into the system. And I think people— I've been observing China a lot. Uh, people should go listen to Joe McCann's interview November of last year. He also references China and like the central bank and, uh, injection of liquidity. They're obviously having more systemically like the US, like it's an untenable situation. They have basically 2008 on their hands. They have like a bunch of like underperforming loans in the real estate sector. Everyone knows it. The question is like a lot of these like internet Chinese internet companies are trading at like distress levels, like sub-10 PE ratios. Like that's just bananas in my mind. It's like I look at that and the coupon that you can get some of these like structured products. And to me that's just a signal that the market is incredibly bearish on China. And I think you just get paid whether it's crypto or in some of these other alternatives, so to speak, when people are just, as Howard Marks likes to describe, the pendulum swings to extremes. Crypto is very much like that. And it, yeah, I just think it's just topical. I think I'm very encouraged by what I'm seeing, particularly coming out of Singapore, you know, like talking to founders that I'm an investor in or just not an investor in. A lot of energy in the Breakpoint conference, a lot of product shipping. I still need to catch up on a lot of the videos, but I've been very public. I'm very— and I think you have too— I'm very bullish on certain categories that are going to, you know, be pretty impactful to showcase people what crypto is all about.

Like what?

T-Bit.

T-Bit?

Deepin.

Oh, Deepin.

You cannot argue reasonably with a person if you tell them, would you switch your mobile operator if you can save 50% and it's the same plan or even better in terms of reliability? Same speed. Like, you know what I mean? We, we've never had that. We've never had that clear, coherent, no-brainer argument for crypto.

So what is the— if you are listening to this and you say, oh man, okay, Santi, I know he said think for yourself, but I don't want to think for myself. I just want to follow Santi into these trades. How do you put on a deep end position? First of all, I know he said the biggest mistake that people make is following other people in these trades, but I don't—

thank you. Thank you for, uh, Yeah. First of all, none of this is legal or any advice for that matter. I am highly unreliable, should not be trusted. I can change my mind on a whim. So anyways, now that that's out of the way, here's how you should know.

I'm kidding.

I mean, there's public, obviously my—

You know why you can't listen to people, by the way, about what they— you remember in— actually, I won't actually dox anyone. Well, you know, people change their minds all the time and they don't always announce it. So let's say you see on Twitter, or let's say, yeah, let's say you see on Twitter that someone sold a bunch of their WIF. Well, you might want to go home and sell a bunch of your WIF because you trust that person. But then the next day they changed their mind. They said, actually, I just saw a bullish signal and I bought back my WIF. But you— but they didn't— but they never updated you on that. So now you're, you're caught and WIF is up 20%. And you're—

it's selective announcement of— and probably survivorship bias and all those biases, right? Look, some of these traders like are LARPing and like, if they're actually correct, they'd be like the best investors of all time, which they're not, uh, because they're running like private paid groups like on Telegram. I'm like, huh, there's a big disconnect here. I don't have a paid Telegram group, ladies and gentlemen. If you ever see one, it's a scam. And so, you know what I mean, like these self-proclaimed like the best traders on crypto like have these paid Telegram groups. I'm like, well, if you're really that profitable, like why do you need to like sustain yourself on paid Telegram groups? Nonetheless, I digress. Um, Deepin I express it through largely private investments, you know, the likes of GeoNet. Well, actually GeoNet has a token, but like, look, my investments, I guess I'll tell you, like Andrina, you're an investor in Andrina, you know, it doesn't have a token, but that's one way to express it. I guess if you're like more practically speaking for people that are investing in tokens, like you could look at, you know, no surprise, Helium, very encouraging, the mobile carrier offloading is huge, I think. So that's something that I'm really tracking. The other ones are like, you know, you have Hivemapper, you have— I'm just listing like in no particular order, like just the public, the largest DePIN projects. You could buy a basket of those. I would caution and I would encourage people, like there are very meaningful differences amongst these, particularly the thing that I would focus on in terms of doing diligence. So I'll give— I guess this would be useful— is focus on like the token economics. For instance, I met a lot of projects who are like, hey, we've been able to, you know, cert— like, we've been able to, you know, map like 50% of the roads in India. And you're like, wow, that's great. And they're like, so you basically penetrated 50% of the market and you've only generated less than $1 million in fees. So you're telling me the market opportunity is nothing. So I think that's a challenge in both the opportunity in Deepin that like not all models are going to really work. Not because— so like traditionally infrastructure has been very much like monopoly, regulated monopolies, or just artificial, like natural monopolies in the sense that like they're very capital intensive. So like because of that, it's very concentrated. And so insofar as like Deepin lowers that CapEx cost, allows small incumbents to like come in and disrupt the market. Again, doesn't necessarily mean that like the TAM is that— the TAM may be very big, that like the total addressable market is saying, okay, like you can build a next cellular mobile, like a next, next like telecom in the US. Well, that's multi-billion dollars. But like the fallacy might be, how much does that actually translate into revenue? Because either the price comes down because you're undercutting, right, as a monopoly comes down, then you might not be able to charge as much. And so the revenue trend— I think the market's not dumb in the sense of like, there's a reason why a lot of these steep-end projects don't trade at multi, you know, multi-billion dollar stuff, right? Um, and so it's either tokenomics are off or the monetization is unproven, right? They might have been able to scale the supply really well, but the demand's not there. The users are not there. The usage is not there. Like, again, you could really incentivize people to get on the network and mine a particular token. That doesn't necessarily mean they're going to stick around or they're going to use the product. So, you know, Helium, for example, probably the most— I'm not actually an investor, uh, but, you know, probably the most interesting project in terms of traction. They are trading at a $1.6 billion valuation.

Hmm.

So, and then there's like vaporware that trades at $7 billion.

Yeah. Have you seen the metrics of Helium's metrics recently?

Like the— I'm mostly looking at the carrier offloading.

Yeah, the carrier data here. Let's— I just, I just found this on Twitter. I don't know the source of this, but this is the, this is the chart I'm talking about. The chart looks something like this. I don't know if this is the exact right chart, but like Yeah, I mean, it is, it is, uh, it's working. Yeah, it's working.

A carrier would not offload traffic onto the Helium network if they didn't think it was reliable. They wouldn't risk their core business, right?

The, the TL;DR on it is 130,000 signups, right? Right. Offload 59, 50, 60, 60 terabytes of data, right? Offloaded, which has gone parabolic, and 143,000 daily subscribers. So these are subscribers, other carriers that connect to Helium. Yeah, pretty crazy.

Look, everyone should go read Primer on this stuff. No one will, I guess. So the TL;DR is networks rely on other networks to share coverage, right? If you're a subscriber to AT&T or Verizon, you might go to a particular region that AT&T itself doesn't have coverage, but then they rely on other networks to provide service. And they're always— the challenge is always like the peak load balancing is like they need to have enough capacity for like peak usage and consumption, but of course not all the time you have that. And so that's why it becomes important to be able to offload some of that traffic. Uh, subscribers, whether because they're in a particular region or just too much traffic and congestion, they use— and they're starting to use more so the Helium network to solve for that. And that's very encouraging. Yeah. So I, that obviously translates into, as you just brought this up, how much helium is being burned, right? Hmm.

How do you think about when you see metrics like this that are good, but helium's, the narrative around helium and the soft stuff around helium have been like soft in the past. How do you think about those two things?

I'm not an expert. We'd have to bring in maybe Kyle or someone who's very much into it. Because I think again, the nuances, like, okay, the tokenomics and the revenue, the monetization piece, I still haven't dug enough. As I said, I don't have a position, but I'm looking at this as a case study into just DePIN as a category. But to me it is, I would guess, so said differently, if you were to describe Helium to someone and you probably could tell them, hey, listen, it has all these usage and stats and like, where do you think it would be trading on a fully diluted basis? Over, under? By the way, high, like circulating to total token, like, you know, market cap is 1.2, fully diluted is 1.6. A lot of those tokens are already in circulation. So it's like 75% of those tokens are in circulation. So a lot of it's been vested and in the market. Um, I would probably guess that most people would estimate that it, it's over $1.6 billion and fully diluted, right? Right. Particularly if you kind of frame it in, I don't know, let's look at Ondo, for instance, flavor of the month, $8 billion. Yeah. Which I'm bearish on, by the way, for a few reasons. Like, I just think treasuries become less and less interesting. In a world where rates go down. So that—

well, and there are so many people offering treasuries into the on-chain market that it becomes a very commoditized—

that's a commoditization. The appeal of punting treasuries goes down as rates come down. And so I think the more interesting opportunity that I think the market's waking up to is what are those— it's like money markets, right? The Avis of the world, the Caminos of the— Caminos have been on a tear for full disclosure, investor in both. But I think there's a reason why that is. And I think the market's sort of waking up to that idea that like the higher yield opportunities and the ability to capture fees is going to go more towards less tokenization of treasuries and real estate, some of this stuff, more so money markets, right? That people are doing recursive leverage and spec, like, you know what I mean? Like that, that is where a lot of the fees, you know, end up in a higher risk environment. So to speak. Yeah, this is a pretty—

by the way, RWA.xyz, I don't know if you've ever been to this site. It's a really good resource to look at all these treasuries.

So who has the highest? For instance, it's BlackRock, right? Biddle.

So treasury product metrics, it's Biddle, which is BlackRock, then FOBXX. I think that's Franklin Templeton, I would assume. Okay. Oh, here we can look at it here. So top entities. Okay, so they break it down by protocols. So Ondo's at $600 million. Securitize is at $500 million. Franklin Templeton's at $400 million. That's their Benji product. Then it— there's a big drop-off. It goes Hashnote, Open Eden, then Superstates around $100 million. Then it's a big drop-off, right? Centrifuge, people know that name, $35 million. The issuers, if you flip over to this tab, yeah, BlackRock is in the lead at half a billion. Yeah, um, this will get shaken up because there's a huge program, it's called Grand Prix. It's MakerDAO Grand Prix. It's a billion-dollar incentive program. They're basically taking a billion dollars of like unallocated, I think, USDC. I'm sure I'm botching this, but they're taking a billion of USDC and then allocating it to some of these people and buying treasuries with it to get the yield on it. So I think some will flow into— got to imagine Ondo, Superstate, BlackRock, folks like this.

Yeah, but you know what I mean, back to Deepin, like, I guess it would be interesting if we were to do a poll and be like, where do you think Deepin, this particular name, trades knowing the backdrop of some of these metrics, actual usage? And I guess, yeah, I don't— I actually would invite listeners or someone that would like to come on the pod next week, like, explain to me why, what has been challenged, or like, I'd like to have a debate of like the bull case and the bear case for Helium as an example, or GeoNet. But let's, let's talk Helium because I think that's like the, the, like the, the most important DePIN protocol right now because it is just— that has the most amount of traction and visibility. Or I'm happy to construct— no, no, no, no, no, let's just do that. My brain and that— I'm happy to like come prepared. I'm not as prepared next session.

Would you take the bull case or the bear case?

I could take both. I'm going to construct both arguments in my brain.

Who, by the way, switching gears a little, who won the debate with you and Avicii?

I actually think Avicii did a more, was more articulate. He presented more facts. And I think he did a really good job. I think he won actually. The polls say that I win, but of course, I mean, you were at a Solana conference. So I was at a Solana conference. We both had to take both sides of the argument. So We just came at it from different perspectives, but I think you do a really good job.

Nice. I have a, I have an investment I'd like to put in front of you. Oh, yes. We got the Polymarket live. Hoffman. Hoffman versus Warwick. Yes. I got Kane versus David.

I caught up with Kane on Singapore.

That dude is looking good these days. In terms of his— he's been bulking, he's been training, he's ready for the fight. I actually— he's sober too.

I've been trolling Kane. Like, he was— they did this part of this InfiniteX event with Omega ETH. I know you're an artist in InfiniteX. And they texted me before the event, like, they had these F1 simulators. And, you know, Kane was like— Kane's talking shit. He's like, I'll crush you, man. Let's put one Solana on the line. I'm like, Fine. And he's like, I've been training, you know. I'm like, okay, not because you have a fancy car does it mean that you're gonna be good in the simulator. I'm like, you're training— he's like, you're training for running, you're training for karate, you're training for like simulators. Like, you know, the— you know, you're like a mile wide, an inch deep. And he's like, oh, you get all triggered by that. Funny thing is though, that in this, in this event, there's— they had these two simulators. I think Kane was like, okay. And then his other partner Igor was okay. And then the, the Andre and Miguel from Second Lane, they're actually professional like Porsche. Really? Yeah, yeah, I didn't know this. So they told me this when we were in F1, and of course they smoked everyone out of the water. They're like really good drivers. And so anyways, um, just as a reminder, anytime you talk shit, there's always a guy that's quiet in the background.

There's always a guy. Yeah, yeah, yeah.

Well, anyways, back to this. Who do you think wins?

Oh man, don't pull up the market.

The market's already— the market's good.

No, I— you think the YouTube comments are good? Look at the— look at the poll. Pretty sure David Hoffman's a proud drinker of Soylent. Oh, David's popping off. David goes, I eat more steak than you. Oh, this is funny. All right, so the— we are recording this Thursday afternoon. Uh, Hoffman is a 35% chance.

Okay, ladies and gentlemen, there's less than $7,000 in this market, so I can go in here and punt the odds. Like, I think—

oh man, this is, uh, I think there's some money to be made in this market for sure.

There's, there's, there's gross, you know, for context, Kane, Kane boxed back in the day.

So if you put $1,000 on Kane right now, it's a 30% return. You put $1,000 on Hoffman, Yeah, 65%.

Oh, okay. Yeah, the market's saying that— sorry, I got this wrong— the market's saying that Kane—

no, the market's saying Kane will win. Yeah, yeah, yeah, 65.

Um, I actually think it's closer than that, 50/50.

50/50. All right, put your money— so, so then you should bet on Hoffman.

I'd look— no one— listen, I'm not gonna make a prediction on this, but I, I mean, I sympathize. Kane's my friend, so I'll put money on— I'm not gonna bet against my friend. Damn it. I have a lot of flaws, but loyalty is not one of them.

Yeah, true, true, true. So we had some regulatory stuff this week. So like regulatory policy, public, public sector. So Richie Torres had some epic comments. Maybe we could play that and listen to them out loud. Nick wrote a great piece. Nick Carter wrote a great piece in Pirates Wire, which for anyone that doesn't know, what's that? Pirates Wire was a— is an independent media company created by this guy Mike Solana. Really took off during COVID as I think there are a lot of people fed up with like— fed up with like either government overreach or, you know, maybe they're pro-libertarian or they're fed up with the mask mandate or they're fed up with lockdowns or they're fed up with like the woke movement or like it was all that, you know, kind of crowd, I would say, needed a place to consume information. And Mike Solana created Pirate's Wire. I don't know when he created it, but I associate it with like coming up during COVID And yeah, it's a, it's an independent media brand. So nice. So what was the extent of his post, Nick? Basically. So I've skimmed it ahead of this, but I need to— it's a very— it's a long piece. I need to actually sit down and read it. The things that I wrote, like the bullets that I wrote down as I was like looking through it. So One, one is that Silvergate— basically Silvergate. So Nick's been writing about Operation Chokepoint. Obviously, Chokepoint 1.0 was, was Obama basically debanking a lot of the like— I think it was marijuana companies, gun companies, things like, things like that. Nick has been talking about 2.0, which is purposefully debanking a lot of the crypto companies. So when Nick wrote this piece, he said, look, I feel very vindicated. A lot of what I called out back in March when there's this banking crisis has actually come true. So reading through some of the bullets I wrote down, so Silvergate voluntarily liquidated in March 2023. It wasn't a forced liquidation. It was a voluntary liquidation where they were crushed by regulatory pressures. And one of the takeaways of this piece is that there was, there was a bank run, but they actually survived the bank run. It was the regulatory pressure that forced them to liquidate. So that's one. Second is that the Federal Reserve allegedly imposed a secret 15% cap on crypto-related deposits, which killed Silvergate's business model. So the Fed put this 15% arbitrary and secret cap on crypto-related deposits. Silvergate obviously has a lot of crypto deposits, so that, that really hurt their business. Nick called out Senator Warren's public letters, which kind of questioned Silvergate's practices, said that her letters, her public letters questioning Silvergate's practices started to fuel the downfall. And then Nick calls into question a potential alliance between Warren and who's the short seller, Marc Cohodes, where they kind of like targeted Silvergate together.

And Marc And Cohodes, a notorious short seller, he was, he was very much vocal on this for a while.

So I think when Nick calls out— and again, I have to like fully read the piece because this was just me skimming it— is that Cohodes was kind of fueling Warren with some pieces of information and Warren would just publicly write, you know, kind of write out what this short seller was saying. And he, you know, she'd kind of write it out in these public letters. And so Silvergates collapse kind of then triggered this domino effect which took down SVB and Signature. I'm trying to think if there's anything else in this piece. I mean, is it really— I mean, I'm not doing the piece justice. There's an amazing piece that Nick wrote. We will link to it and you should actually go read this full piece. It'll take you, take you like 30 minutes or something, but it was a good one.

So Well, I guess on this point, not to— how do you think about all of that in the context of just the election? Just, I want to touch briefly on that, just if you have any updated views based on where you sit and also based on your conversations with folks over the last couple of weeks.

Well, so Kamala came out and had these two pro-crypto statements this week, which were what I would call the the minimum viable positive crypto statements that she could make. There was like the— I mean, I'll just candidly, the lamest. It was, it was better than not saying anything. So where she's been right now. So here's my summary of this. She— everyone, everyone didn't like Biden because Biden was kind of in cahoots with Warren and Gensler and hadn't really done anything to help the crypto industry. Then obviously there's the hot swap and Comely gets put in place and the whole industry, I think, was kind of anxiously awaiting maybe a pro-crypto Democrat in Kamala. And it's been disappointing the last month or two because she hasn't said anything. She's been very quiet and hasn't really laid out her policies. Now, she hasn't— it's not like she hasn't laid out her policies on crypto, but she's laid out her policies on a lot of other things. She hasn't really laid out any policies on anything. Right. I was with a health care executive earlier in the week and he's like, yeah, we haven't heard anything about health care. We have no idea how she thinks about health care. And it was, you know, same, same as crypto. So this week she spoke at a Wall Street— at a thing on Wall Street and made one statement about being, I think, pro-crypto or something like that. Then yesterday, yesterday she came out and I will share. I added— Factoring in aerospace, remain dominant in AI and quantum computing, blockchain and other emerging technologies. So, right. So what she said was we will remain dominant in AI, quantum computing, blockchain, and other emerging technologies. So you've got a couple of people on crypto Twitter. I think it was Hayden Adams. David said, you know, this is the pivot. Kamala is officially pro-crypto. I don't— I'm— I don't think that is the case. I'm— I'm waiting for— I think to be— I think to be pro-crypto after so many years of being anti-crypto, you need a much stronger you can't just throw block— first off, what is this word blockchain? You can't just throw blockchain in with quantum computing and AI. You have to—

I need a year. I want to launch a token on pump.fun to be convinced.

Yeah, I need— you have— you have one—

let's just juxtapose this, ladies and gentlemen. You have one political candidate who wants to launch a token. The other one continues to use this blockchain terminology. That's it. I'm not— you know, I think I'm just gonna leave it at that.

Yeah, yeah, yeah. I'm actually a little turned off by the word blockchain, by the way. I think it's from the blockchain, not Bitcoin era. Yeah, yeah.

Crypto, blockchain, not crypto. Yeah, exactly. So, um, I mean, listen, politicians will do and will say not do anything to get elected. So yeah, you know, yeah, whatever. But I was like, on this point, on this point, um, the odds have been all over the place. I think Kamala has been ripping, actually. 55-45 now, uh, as of late. Um, so take that for what it is. Also, the Crypto Pack has been donating a lot to Kamala as well.

I didn't know that. Far? Yeah. Anyways, really? Where did you see that?

I may have heard it. But I just— yeah, that's interesting.

Yeah, I did not. So anyway, so that, so that happened this week. I think people are, you know, it's, it's just a little behind the scenes. Like, we've reached out. So at Permissionless, we have several congressmen and senators coming to speak and we've just had a lot of political interest in the conference just because it's a week out from— or excuse me, it's a month out from the election. We have sent an equal number of invites to both Republicans and Democrats. We would like to have— we actually would like to make this more of a bipartisan conference instead of a partisan conference, even though I know a lot of people in the industry vehemently disagree with me on that. That's just the decision that we've made. We'd like to make it more of a bipartisan conference. The— there have been several conservatives, Republicans, right, who have accepted our invitation. Mike Lee, senator from Utah, is coming. John Curtis, the most likely incoming senator from Utah who's replacing Mitt Romney, who's replacing Mitt Romney, is coming. Tom Emmer is coming. Right. There's several Republicans who have accepted.

Tom Emmer is behind the stablecoin bill. Yeah, I think so. He usually comes. He's great. He's great. Clips about him interviewing, like, he's great.

Yeah. There's only one Democrat who's accepted our invitation. I have emailed the number of people who we've spoken with, we've had calls with, uh, senators, congressmen. Only one person has accepted our invite, so it was, uh, pretty disappointing. Um, and that is— that's Richie Torres, by the way.

Um, who did a fantastic, fantastic, fantastic— if people go listen to that clip. Yeah, basically corners Gensler. He says, hey, um, you know, is the— is a New York Yankees ticket a security? He's like, no. And then he's like, okay, well, how is that any different from some of these NFTs, right? Right.

So there it is. Can you hear that? Yeah, beautiful.

Play. Mr. Gensler, uh, suppose I were to sell you a Yankee ticket and tell you that the Yankee ticket could appreciate in value and could be resold at a profit in the secondary market. And as is the case with all sports tickets, suppose the proceeds from the sale of the Yankee ticket goes toward paying for the Yankee game, by selling you the Yankee ticket, am I entering into an investment contract with you and therefore conducting an unregistered security offering?

I appreciate the question. I don't know all the facts and circumstances, but I don't think so. I mean, I know where we're headed here, Representative, but I don't think so in that—

yeah, so Yankee ticket is not And why is the Yankee ticket not a security?

Well, it's really a question, and the courts have been clear on this, is the offer and sale—

Specifically with a Yankee ticket though, what, when you're buying a Yankee ticket, what are you purchasing?

You're buying—

Access to a Yankee game, is that fair to say?

I understand. It's been a while since I went to a Yankee game, but that's—

Fair enough.

You're welcome to a Yankee game. I used to live in New York and my 3 daughters were all born in New York.

So in the Stoner Cats case, the creators were selling an NFT that offered access to an animated web series. From the standpoint of federal securities law, is there a legal difference between buying a Yankee ticket that offers you the experience of a Yankee game and buying an NFT that offers you the experience of an animated web series?

Again, I don't want to comment on any one specific, uh, well, it was a settlement, a fait accompli.

It's not an ongoing litigation. You can comment on it, but it's It's about how is something offered and sold.

Is it offered and sold as an investment contract? Are individuals looking to a common enterprise anticipating profits based on the effort?

I'm familiar with the definition. You're avoiding the question. Thank you. Oh, Adam.

I muted.

That was good. Yeah. Yeah, go ahead. That was good. This is what I mean by I'm not as— A lot of the discussions that I had in the last couple of weeks have been around asking a fund manager or just people, "Hey, how do you think about the election risk?" And I just think that a lot of people are giving it too much weight in their decisions. And while it may be true that in the near term there may be some dislocation to the order of 10-20% plus minus, like in either direction. I just think that I can't be but excited about that. Both the short-term mindset of a lot of allocators, you know, on one end, like, people are only talking about the election and the particular movement that that might have, like 10-20% in an asset class that I'm underwriting 10x is nothing, you know what I mean? Like, there's a there's a disconnect there that I think this is why you can make— why I'm excited in this asset class, because there is that time preference and too much weight on near-term things that, yeah, don't factor into my thinking as much when I'm focused on the long term and the compounding effects of like, this is either going to be a zero most likely, or like 10, like very asymmetric outcome. And so I pay attention to these opportunities because I see them as an opportunity in the sense that most people are distracted in many ways, right? And you know, you're looking at all the Breakpoint videos and all the traction and token, and then you're seeing this amount of like too much nearsightedness combined with like this encouragement of like on both sides of the aisle, it's become more and more clear that there needs to be rulemaking, there needs to be policy. And every court case— most court cases are not being won, like, are actually by, by the, you know, three-letter agencies. They're being won by crypto projects. That fair point, you need to be well capitalized, you need the resources to fight it. But crypto continues to raise money to fight it off as a lobby, as an industry. We become better at that coordination. So even if you're not Ripple or Coinbase that You don't— you know, of course it helps to have these coffers to like, you know, pay the legal bills. But I just— this is what I mean by I'm not as concerned about the election. And I just think that it's certainly important, but it's not— I think it's going to be a divided House. And so the worst— I guess the worst case is we don't get enough policies, be a stablecoin bill or some other sensible regulation in the next 4 years. That to me is probably going— probably like I'm just kind of underwriting that. Yeah.

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Update their priors, right? It's like you should be updating your—

just to share like how I am uncomfortably bullish at this point. I really am. I'm—

look at the man. Look at the man and his eyes. I am really fidgeting on the chair.

I really am. I'm coming back from Token and Breakpoint being like, these people online have no— are so disconnected from reality because the loudest people on crypto Twitter are the traders. And they have been sitting in the midst of just choppiness for 6 months. And I am here. I'm in the trenches with 20,000 people who are building really cool shit. Yeah, that is, that is the traders. No, that cover picture, that cover, that cover picture of the people on crypto Twitter and you, Jason Yanowitz, smile on your face. Me, because I am just excited.

By the way, I just say this guy, the way that he knew that my favorite to put in the foreword, like my favorite excerpt of a speech from Teddy Roosevelt. He's like, the book is dedicated to me. And he starts off by saying, the credit belongs to the man, is as scratch as a man's a santee, who is actually in the trenches. In the arena.

Yeah. In the arena. I'm going to get roasted for this. That's amazing. But it's amazing. I mean, at the beginning, okay. China is doing massive liquidity, both monetary and fiscal stimulus. We are cutting rates, and we're about to have a decision on the election where I don't think it necessarily even matters who's going to be elected. It's just the market hates the uncertainty of not having someone elected. It's like, come on, guys, like, be a little more— like, just look, look, look 2 months out. You don't even have to look a year out. Like, just look 2 months out.

So yeah, it's, uh, we're gonna see a relief And most of the times it's like, do you see it up or down? Doesn't really matter. The long-term trajectory, you know, you all see the chart, right? It's noisy, but I just, you know, I can't help but be encouraged by a lot of the traction. And I continue to believe we're entering a consumer application phase of this industry. You're seeing it in different pockets. It's real. And a lot of times it's sometimes very important to re-underwrite your thesis. And I appreciate some of these things might have been tried in 2014, 2016, 2018, 2020, 2022. The space is moving fast. And I think you need to be constantly on top of it. And traders can make a lot of money. I guess the difference is know the game you're playing, either you're a trader or an investor. But if you're going to be investing and you're underwriting the type of return that probably you're requiring to take this amount of risk, you should be paying a lot of attention, but you should be actually paying attention in the right areas. Meaning go look at all the goddamn break— breakpoint videos and less lines on a chart. Go understand what's happening in China, you know, that matters. Liquidity injection matters. Like the market— like China internet's like rally. Like look at BABA. BABA has gone from $70, $60 to plus $100 in like matter of— in this week. Yeah, it's just Wild. Yeah.

We released a good Solana dashboard. Have you seen this thing?

I saw that.

Yeah. Yeah. So we actually made it free. So big shout out to the— Were you at Breakpoint? Yeah, I went for, I went for like a day.

Nice. What did you think of it?

It was a pretty incredible event. I mean, from an event organizer perspective, it was like one of the best organized events I've ever been to. And then I just loved the focus on like, I would say, front-end products instead of infrastructure. You know, obviously they don't have to focus on infrastructure because they are the infrastructure. So it's— I mean, I think— Great point.

You had a, you know, Firedancer announcement, but that was—

Firedancer, yeah, of course. Yeah, I thought it was an amazing event, actually one of the best crypto events I've ever been to. I thought the like sponsorship activations were good too, like John Boat's pull-up bar. Which I got roasted on. Wormhole. Yeah, we're— yeah, we can talk about that later. But Wormhole had the, like, bridge from, like, one place to another. I thought it was— yeah, I thought it was a great event.

I mean, I thought it was the best crypto conference I've been, full stop. The debates were great.

Yeah, we— I mean, we're going to take a lot of— like, every time I go to these conferences, I just take inspiration for how to make our events better. And sometimes I go to these and I'm like, you know what, there's there's really not much here I'm going to take inspiration from, but Breakpoint's one of those events from like, they did the little things right.

They didn't give me any reason to leave. They had good beverages, good coffee. The speaker lounge was well situated where I could, you know, it was, I had all my meetings there. I was, it was incredibly productive. It was just flawless in my mind. It was really good. You know, most of the conferences have crappy food and just give me good coffee and variations of coffee that I want to have and don't give me a reason to leave. You know, I mean, like, it was just good. Yeah, it was very good.

So we're thinking about this from a conference organizer's perspective. The industry is about to have what happened in SaaS, where there used to be these big SaaS events and then you started seeing all the big SaaS companies— Salesforce, HubSpot, etc., Twilio— create their own conferences, right? And so Avalanche has something in like 2 weeks in Argentina. Solana has had Breakpoint. You're going to start seeing more and more of these.

You have side events like Monads probably going to do one in New York.

I heard Monads doing one, I think next week, actually.

Oh, yeah. No, but they're going to have a more developer, like a DevCon of sorts. Oh, basically what you're saying is everyone will have a DevCon of their own.

Yeah, well, I'm not like— Breakpoint wasn't really DevCon. It was it was their own unique flavor on what a good conference should be.

But that's DEF CON, right, for Ethereum? Like, that's amazing. Yeah. You have these ECC events and ETH Global events.

So what are you as an attendee more likely to attend? Like, Solana, I guess, because you like Solana, so you would attend that, but maybe you're not going to attend another ecosystem.

No, I've attended the Avalanche one. I attended the Aptos one in Korea. Um, I'm likely attending one in Amsterdam, but it's more for allocators. Legend for Legends. For Legends? Legend for Legends, yeah. And you have to ask, I mean, I think—

Is that the name of the event? Legend for Legends?

I like to, from time to time, just check into these events to get a feeling for different, like, I think there's value value in going to a developer-centric conference to get an understanding of the developer community. There's value in, you know, going to a more generalized conference like Token24. And I'm like just amazed and surprised with just how big this industry is. As we covered in the last weekly roundup, like just felt like Dreamforce, just really gives you an understanding of like the entire apparatus of crypto, like sales and marketing teams closing business deals and just felt very different vibe and environment, which is good to see. Yeah, I don't know, I'll probably like do— it's always— I'll do a sample size, right? Probably always go to Breakpoint. I'm not going to DEF CON this year. I just, you know, I'm like, Thailand sounds cool, but yeah, a bit over travel.

So we just launched— we just announced— I know we have Permissionless coming up in a couple— in 2 weeks, actually, which, by the way, we just had our 2 biggest ticket sale days ever. So we're probably going to increase the price. So go get your ticket. There's a code. Empire. I actually don't know what we're doing anymore. Empire 10 or 20 or 30. Just start typing Empire. The discount is— Yeah, yeah.

Start from 50. There could be an Empire 90.

Who knows? Yeah. I don't know.

Damn. I think—

Am I going to get a free ticket? Not this year.

I actually bought a ticket for Breakpoint because I didn't know if I was going to speak or not. I bought it like way, way back. And then of course I got a free ticket as a speaker. Anyways, I was like prepping for the debate and this guy's like, oh, you know, I think someone from Coinbase was like, we need to get someone in. I'm like, well, there's no more tickets. I'm like, hey, well, here's my QR code. So, and the bet that I told this individual is like, as long as Coinbase Prime supports withdrawals, USDC and Solana, goddammit. I will. Yeah. Like this is the condition. So hey, by the way, Brian or whoever, like if you listen to this, I fronted a ticket to one of your guys. So support USDC on Solana, please.

I ran into all those guys at the F1. How was your F1 experience? That was good. It was really good.

Shout out. I mean, I went with the Second Lane guys. It was— I mean, I bumped into you. It's great. I mean, the circuit is really special. It's like Monaco, but something about the night makes it—

I like the night, right? Yeah. It was the first time I'd ever been to F1. It's cool.

To be fair, it's not a very good spectator sport when you think about it.

Like, I appreciate it, and then you wait like 10 minutes and then they come.

It's like a fly in your eye and you're like— It's annoying.

So ladies and gentlemen, yeah, but it was fun. We were in the— so I was in the McLaren paddock thing and Lando obviously won. So that was a cool— that like, that was a cooler experience than actually seeing the cars fly by. Yeah, yeah, yeah.

But it's, uh, most people are watching TV or you want to be listening to the commentator. So yeah, it's actually— I'm surprised of like product market fit here, uh, of like I've been in many races, different circuits. It's not a really cool spectator sport. Most people go because of the allure, like, oh, you know, it's like these, like, Greek gods go into these $100 million cars and, like, they're just living the fast life. And it's, like, so disconnected from reality that it's— yeah, you know, you know, there's this phenomenon of, like, if, if it's somewhat, like, attainable, it generates envy and frustration. So, like, imagine— so, yeah, maybe your childhood friends, they see that they grew up with you. And so there's an element of related— like, you can relate to that. And so a lot of times, most of the envy comes from people in your inner circle. You're like, oh wow, this guy Johnny killed it. But you remember Johnny, stupid. Like, we're like, we grew up together, you know, the same school. How this— and because it's so like close to you. But these guys, like these Formula 1 drivers, are like on a whole new dimension. They're like, they're like Greek gods, you know. They're like, oh my God, like, you know, they're like They're dating models and like they're going from country to country racing. Like they're just like the modern-day gladiators. And like, someone about that, like, people love. And especially obviously the Netflix series.

The Netflix series also.

But even before then, it's like not a very fun sport. Yeah. And by the way, like, I've met a lot of drivers here that like, yeah, I think that it's less like necessarily skilled to be in the driver's seat. A lot of the decision comes down to less so skill, more so how marketable a driver is. So there's a reason why you have now a Japanese, a Chinese, an American driver in the paddock. You know, as soon as Liberty Media bought it, like, they made that transition. They added more races in these places, huge markets. Like, certain drivers like Checo are very marketable. Like, the, the Mexican— you go to Mexico City, Checo is—

Checo is more popular than the president. It's crazy.

Yeah, the president's not very popular. But anyways, yeah, Checo's got to be like the most paid guy on that. No, he's not. No, no, not at all. But he's, he's, he's, he's very, very lucrative for Red Bull. Like extremely lucrative.

He's like, okay, yeah, not him personally, but the amount of money that he brings.

No, he brings— yeah, I mean, like exactly, like the amount of merch and viewership that it attains. It's crazy. So like I've met, for instance, uh, the Formula E He's a really good Formula E driver, and he's like, yeah, I was racing with Lando and Max and these drivers, like, and George. Like, like, I was— I— a lot of times I won the race. Like, it was competitive. I was like, so why are you not in the paddock? He's like, I don't know, I didn't have $20, $30 million to like buy a seat. I'm like, oh, okay. So you have to— I mean, there's only what, 12 cars in the paddock? Uh, 18, 20, no more, more than 12, 20, 20. Yeah, it was like very competed, but it comes down to A lot of it just— well, that's why I like Lewis, because like Hamilton, because like the guy, like, come— most of these come from like pretty affluent families.

Like, so you see a lot— or actually, we can skip that. Um, actually, there is one non-crypto thing I want to get your take on, which is you just— I don't know if you can— we can skip, we can cut this part if you don't want to talk about it, but I am curious, like, you just went to this event with non-crypto people, some like investors and stuff, and I'm just curious, like their view on the markets and what— and I don't know if you talk crypto with them at all, and they're very wealthy people. And like, just— I know you're—

I guess I went to a family office event here, uh, hosted by Apollo. Um, no, they didn't— crypto doesn't come in the conversation. Everyone seems to agree the market's really expensive. We're hitting all-time highs. Um, and, you know, they get nervous about that. And so the theme of the conversation was you should, like, as a family office, you have more flexibility to think longer term. And so, you know, you should be investing more in the private market. So obviously you can get that pitch right from someone that their business is private markets. But I think I related to crypto because again, I think you, I've always gotten more clarity. When I know what my long-term investment— The longer time horizon you have on these things, I think it just minimizes a lot of noise. When you start saying, okay, if this business is spitting out 16% cash flow, then it's a good solid business. I'm willing to put it in, set it and forget it. Again, I've been listening to Founders Podcast too, I think. It's great because, you know, the common theme is like businesses that control their costs survive, like Costco, Amazon. Like these businesses are ruthless in terms of managing costs. And so I don't know, it's just really good. I've been hearing, you hear certain like core themes come up over and over again across different investors, different, you know, people in different industries from metals and mining to technology to crypto. It's like the theme is pretty much the same. Um, but I don't know if you— if any of that makes sense. I mean, there was a lot of things that we talked about, but it was just— yeah, it was, it was— it never— there's like simple things, right? Like, for instance, like, uh, private equity as an asset class is challenged. Like, financial engineering doesn't work when you can't saddle a company with debt. When that debt and cost of service at that goes up 3x. We're not going to a record low interest rate environment again. So you, you have to update. Is that, is that going to be a really viable business model? Well, no, right? So, so who, who can win? It's like, if you're still— you need to buy a good asset, right, at a good price. If you've overpaid, like, I guess concretely there's going to probably be a lost Vintage of funds that like are not going to make any money on their investments. Like if you invested in SaaS, like private, took a company private or bought it out in the private markets and you paid a crazy multiple and you were just betting on that multiple to stay the same and just like delever and like build equity value.

Some of these late-stage crypto companies got 100, they're valued at 100x revenue, right? Fireblocks, Chainalysis, like, and they're great businesses. By the way, great, great. Fireblocks gonna do like $100 to $120 million ARR. Chainalysis, $150 million ARR.

But you paid 10, 15, 20 times forward. Like you are— good luck trying to get that multiple in the public markets. Right. So none of these companies are gonna be taken public. Yeah. You're gonna try to refinance that debt. Hey, different, different rate. But I think You know, a lot of times, like, you can make money in any market condition, in any market environment. There's always pockets that are overlooked. And you could say that about crypto is like an arb on like institutions not being able to allocate to the asset class since forever. And now until recently, you can think about meme coins as levered bets on these ecosystems. And so most funds aren't going to touch them. So there's like these structural arbs that arise in any market condition. Right now, most money is being invested into basically leveraged NVIDIA, right? Like you're buying the index, it's passive. So active management actually becomes more interesting. Yeah. I don't know. It's just common. Like nothing will replace doing the work. Like go do your own work. Like, I don't know. It's just like, no, or pay someone, pay someone decent amount of money to do work for you. Like this is why I invested in certain—

Do you hire your analysts?

I'm working through it. Like I'm structurally, I also want to do a private equity fund, but that's a topic for a separate conversation. Breaking, breaking. I tweeted about this. Yeah. Yeah. But I, the last 3 weeks have been useful to—

So did people like the idea when you ran it by them in Asia?

Yeah. The simple description, which I think great ideas or decent ideas can be crystallized in one or two sentences. I want to do business model transformations with crypto elements. Doesn't mean it's going to have a token. I just generally think there's an incredible amount of opportunity to streamline friction points in different business models with crypto elements. And I'm focusing on the cost side of the equation because I know, I can, I know the option value you can drive The top line, but that's the easy part. If I can get comfortable buying a business and underwriting a decent, great return above my hurdle by streamlining friction points and costs. As an example, failed checkout, massive market, I mean massive problem, billions of dollars like at stake. I think something like 20 to 30% of all retention, like churn, and some of these businesses happens because failed checkout or failed like renewal. Think about that for a second.

I know that does not— Audion, I mean, that's like, uh, Stripe, Stripe, and Stripe, like that's their—

yeah, like Streamlit, but it's still an issue. Yeah. Uh, so optimizing on that, like CAC, you can grow LTV, you can like, you know, LVMH has been experimenting with this, but like, instead of trying to convince businesses to adopt crypto, I'm just going to go knock on the door and buy them. Solid businesses. And just transform it with crypto elements. And so the playbook is— it depends for the— the sectors that I'm focused on is consumer retail. So I've identified—

oh, I thought you were saying you were trying to solve the failed pay, the failed—

no, no, no, no, you're saying one example.

I get it, I get it, I get it.

Yeah, so if you're— if your churn rate—

you move companies onto crypto rails.

Exactly. If 10%— the customer doesn't even know—

you're pulling the revenue immediately up 10%. 100%.

That, that is a massive unlock of value.

I had a buddy who bought SaaS businesses and, um, the only thing he would do, I mean, he did other things, but like the main thing he would do, he would just double the prices. Just double the prices.

Yeah. Uh, loyalty programs. Yeah. Um, token gatekeeping. Yeah. Um, uh, you know, increasing LTV. Again, I'm not, that's the easiest part. Look at LVMH and what they've done with NFT pendants, uh, digital twins, you know what I mean? Like, I'm— there's a couple of like core bets that I'm willing to make. Like, the amount of digital purchases will not only go up to par with physical goods but eclipse that because your digital presence and identity is far more visible and important than as we consume and spend more time online. And your digital closet is fucking empty. Why is it that brands are not offering you a QR code to basically have a digital twin? It's like, obvious. Yeah. And so you go in and you do that.

Yeah. Why don't we close that conversation? Because I know there's a lot more there. And then we can do an entire episode on, on the vision for what you're building.

This is not an offer or solicitation, by the way. I'm just fleshing out my ideas. But the simple thesis is everyone's focused on exporting crypto inside out. And I think that no one is doing this, and the opportunity is vast. I'm looking to buy— I mean, it's— you can go and acquire large businesses and transform them. Crypto is just an operating standard.

How much do you think you'll raise?

Oh, I know, probably zero. But, uh, I don't know, it just— I will find out. Yeah, yeah, yeah. Fuck around, find out. I'll be— I'll be fucking around a lot.

All right. Good chat. Good chat. Cool. Thanks, everyone, for listening. We will see you next week. Thanks for watching today's episode. Just wanted to quickly mention that the wait for crypto's killer app wave is nearly over thanks to today's sponsor, Anoma, the universal intent machine. To stay up to date with Anoma, you can follow them at x.com/anoma or sign up for the newsletter at anoma.net. Thanks again to Anoma for sponsoring today's episode.