15 Years For Do Kwon, DTCC No Action, Markets Down, Frax, Infinfi, ChainOfThought

Transcript

[music] [music] [music] How about the [music] How about [music] the [music] [music]

How the [ __ ] [music] [music] JP Morgan, Black Rock, DTCC, Fidelity, the entire thing was just institutions. [music] It's just it's next level. This industry is going to the next level. And guys, I I don't know what else to say. Bush. [music] >> He said it. He finally said it. So he's bullish. I'm bush. We're bush.

[music] [music] [music] >> [music] [music] >> How the mother [music] [music] down.

I'm the buff [music] [music] above the [music] How the mother [music] [music] is headed to the top. If we're not already at the top, we're going to the top. We're on fourth floor today. We're

going to be on floor one and then we're headed straight to the moon, boys. [applause] Jesus that's goodbye to your bags. Na na. Sing with me all n. Welcome to the bare market of 2026. 15 [ __ ] years for Do Quan. Steady, lads. Welcome back to Roll on TV. It's Friday, December 12th, and I don't know what to tell you guys, but if those Framework Ventures guys come back on this show, bull posting,

the market dumps 8% the next day, I think we might have to put it put them in timeout, boys. What do you got to say about that, Robert? >> Yep. So guys, if you're on Coin Gecko, let's just recap things. Um, Bitcoin is up a half percent in 24 hours. Ethereum is down 3.2% 2% 24 hours. >> Yo, what chart are you? >> Hyperlid is up 4.8% in the last 24 hours. Zcash >> holding Salana right now. I am scared. >> Zcash is up 2%.

>> If I'm holding Salana right now, I am scared. >> Everything else I see is down about >> anywhere between one and four and a half percent. So guys, as you can tell, it's all over. We're gonna be shutting down the rollup. Um, shout out to everyone who's helped us on the journey up until this point. We're broke. We lost it all gambling on prediction markets and pers. >> Guys, guys, I just want you to know that I went to the Bucks game last night and I hit on my overbat. I'm back.

>> So, >> I'm so back. Andy, I did not watch the Bucks game, but I did see the post I saw the postgame interview of the Bucks head coach dropping seven fbombs. >> No way. >> He talked about what he was going to tell his players in the locker room the next uh when he when he went in there after the press conference because I guess they blew a pretty nice fourth quarter lead. Maybe you could tell us about it. Bro, they're up 28-20 with like three minutes left and the coach is having them throw the ball. Hella, because they wanted to like score, I guess a field goal to put it out.

Freaking Baker throws. He's been throwing terrible all night. Throws a terrible pick at the 50 yard line. Dude, the Falcons run like four plays to kick a field goal and end it. It was just >> But they were up 28-20, you said. >> Sorry. They they Sorry, sorry, sorry. Yeah. So they they had 28 like six minutes left. Throws the I think he throws the pick then they score. >> They went they go down and score >> and then he comes back turnover on downs or I think maybe it was vice versa. Turnover on downs and it was a punt and then they scored and then they threw a pick and >> and then they threw a pick and then they got a field >> and it was just and they were off sides.

Third and three first quarter they were off sides. I don't know. It was just silly stuff, man. That then it turned into a touchdown. Anyway, let's get some stuff up on the board. We got some stuff to talk about, Leo. So, let's get some stuff off. Um, and let's get after it here. >> Yep. I'm not sure what is going to come up on the board first, but I do >> What's that, >> bro? I want you to just go. >> I'm going to give a little prelude. Tell us what's coming, baby. Whatever comes up on the board, we know that it's going to be in this this new neointech category.

>> It's probably going to be Doan, buddy. >> Could be could be Duan. That's the old >> tweet tweet went so viral. >> It's such a thing. There's no words really. I mean, it's so wild. >> This is what I'm saying. DTC's not action letter from the SEC to tokenize certain DTC custod by leveraging laughing in the background. I hope it does doesn't happen. It does [laughter] happen. It's not that bad. >> There's a lonely thing happening behind our team. [laughter] So, >> our technical crew is going to have to take a look at that >> and [laughter] we're gonna have to figure out figure that one out.

>> This is Martin Shreley telling Docoin that jail's not that bad. >> All right. So, we know that's going to be coming up next. Um, by leveraging blockchain, DTCC aims to bridge tradi and defi. This is what we've been saying. Chain link picked it up from our show yesterday. This is the new barbell. It's no longer web two and web three. We're no longer building the next evolution of the internet. We are building the next evolution of fintech. This [snorts] is the category that is poised to explode over the next year to five years as the institutional capital and the institutional T-W takes place.

DTCC. Andy, take a guess at how much volume, settlement volume, the DTCC does annually. Take a guess. >> Uh, six quadrillion. >> That's pretty accurate. I don't know if it's six, but I know it's in the quadrillions. Quadrillions. >> Let's go, bro. Let's go. I'm a Chad, bro. >> Volume in the quadrillions. And now DTCC has clearance from the SEC to tokenize assets that they're settling. Absolutely incredible developments happening in this category. Look, they want resiliency. They want reliability. And we know where they're going to go.

They're going to go to the category of DeFi that has been here building since 2017. It's the chain link a cabal that is poised to benefit from all of the enterprises, all of the Wall Street banks, fintexs, neo banks, settlement venues, exchanges that are now getting into crypto. >> It's pretty insane. >> They've had their eye on this industry for a decade, five to 10 years. They've been seeing it. They've been watching it. They've been having their their team research into it and finally they have regulatory clearance to enter the space and not just make announcements about

announcements, announcements about researching and exploring. No, this is actually a fora into the space to practically do something. >> Okay, but let me ask you something like how does this affect the market in the next so does it? >> It depends what market you're looking at. If you're looking at the private markets and you're looking at and we can take for example Bitwise and you can take Fidelity and you can take like the existing fintexs that are private and some of them are public. If you're looking at that market, that's where they're trading. Those are the things to keep an eye on. the altcoin market, all this infrastructure that is trying to

sell to the ones with distribution, the ones that already have product market fit and consumer brand trust, all of the infra is going to be battling for these companies. These are the companies that are poised for success and they're going to have their pick of the litter when it comes to the infrastructure and all the altcoins that went public and launched tokens too early. >> So, you're looking at if you're looking at the altcoin market, you're looking at the wrong market. I just don't know how this affects anybody's bags at all [clears throat] >> because no one has DTCC bags. No one has Fidelity bags. No one has Bitco bags.

The VCs that funded Bitco, you know, Fidelity's Fidelity is a public, you know, publicly traded banking stock. So, you can buy them publicly. These are equities and these are companies that are private and they're probably going to IPO before they launch a token. I think the market to have an eye on is the IPO market. I think we're gonna have dozens of IPOs over the next two years, a lot of fintech crypto IPOs. And I think a lot of them are going to do very, very well.

>> And I think the altcoin market is not going to do very well at all over the next two years. >> Oh, let's see what Jerome Pal has to say about that. All right, let's move on. DCC is awesome. I'm bullish. [clears throat] It's really cool. Big news. [snorts] >> Jerome Jerome Pal is done. He's cooked. >> No action's cool for the industry. That's for sure. Um I mean Jerome Pal is definitely You think Why do you think he's cooked? Because he's out of the >> Well, he's going to get replaced. What is he? He's going to be laid up on a beach drinking a martini somewhere. >> He's balling for sure. Huh?

>> He's doing just fine. >> Yeah, >> he's doing just fine. Um but he no longer has a has a material impact. What chain can realistically handle the transactions that go through DTCC? >> Yeah. I don't know, man. Um, >> they uh they built their own hyperledger consortium chain. >> Oh, really? >> Yeah. And so it's like a permissioned blockchain, >> but they're going to have to they're going to make it composable with the rest of uh DeFi. >> And so, >> of course, they have to >> take a guess what company is going to help link them with the rest of DeFi.

uh a chain link. >> That would be my guess. [clears throat] >> That chain link clip was fire, dude. And look, I mean, obviously we were talking to we were talking to Will, the head of uh sales and CFI, uh over at Chainlink, and you know, he was telling us about their partnership with Coinbase. >> Yeah. >> Um which was, you know, obviously a step in this direction. Coinbase, for what it's worth, is more of a fintech company than a crypto company. Obviously, that is >> that's the line that we're drawing here. centralized exchanges, uh, fintex, neo banks, these are the companies that are most poised for succession.

Steady lads, get [ __ ] doan. >> Oh my god. I This closes out the 2022 crime cycle. >> Yeah. Yeah. And it opens up the 2024 crime cycle. No, this is Docoin steady lads rouchy manage coded GG's GG's >> Duan sentenced to 15 years for $40 billion Luna fraud to serve second half of sentence in South Korea.

>> Where's he serving now? America. >> Oh yeah, straight in the penitentiary. Probably right in New York in the maximum security penitentiary. It's crazy how they put up all the financial crimes people with like the biggest murderers and and armed robbers and child molesters of the world. Like they put them all in the same camp. It's like they they take the all the white collar extreme financial fraud and they put you in with the people that just want to take your little body and just run you around and just don't pick up the soap though. But hey, Martin said the jail's not too bad. So I don't know. I don't know, man. Honestly, man, I feel for the guy. I truly feel for the guy. I truly feel like he [snorts]

had good intentions in some capacity. He lost control and he's going to be paying paying for it. And I mean, people committed suicide because of this. People lost their life livelihoods. I lost 40k in in this. I lost $40,000. I vividly remember I was at my rental property in Florida. I was setting it up for the first time and I get this alert that Luna's collapsing. I literally go on MEXC or some crazy centralized exchange and I short it. I short Luna the token.

So, I end up making like 10 grand on shorting it, but I I then go into my Kepler wallet to try to get my US and nuke it. Then I realize that my US is bonded with some terrible random euro token and it's a 14-day unbonding window. I had about $45,000 in it. I ended up getting like six grand out. So, I lost about 40 grand. So, thank you, Docoin, for uh thank you for making me lose $40,000 as a 22-year-old kid fresh off of a great bull run as I'm building out my rental property to start renting it out and collapsing it and causing me a whole week and a half of stress. Um 40,000 was nothing. I have friends that

lost hundreds of thousands and millions of dollars. People, funds and and other large players lost tens of millions of dollars. This thing had a multiple billion dollar market cap at a time at one time. So, man, this is a long time coming for Mr. Doco Kuan. Um, and uh, it's GG's, man. Uh, is what it is. >> Easy come, easy go. I think our first guest of the day, we've got a double guest for you guys. Sam from Fracks. We've got Rob from Infinifi. And we're gonna be talking stable coins. Let's bring him in the back. Let's get them loaded up and let's have a chat. You know what? I think it's an appropriate time to be

talking about Algo stable coins given Doco Kuan's sentencing. [snorts] I think we need a status update on on um on Algo stable coins. I want to hear about yield coins. I want to hear about Genius Compliance stable coins. I want to know what it means now that we have Ripple, Bitco, and Fidelity as national banks and what that's going to mean for the category of stable coins as a whole. Guys, we're going to be right back with Sam and Rob. >> Beautiful. Let's do it >> for our stabled up segment. Don't go anywhere. We'll be right back.

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Go to habachi.xyz XYZ. [music] >> Welcome back to another episode of Stabled Up, our premier weekly show covering the ins and outs of digital dollars, stable coins, and the future of decentralized finance. >> Show is made possible by FRA. And FRA is powering the financial engine of the internet, powering FRXUSD and genius compliant stable coins. This is the stablecoin super cycle made possible by fracks. Now enjoy stabled up our weekly stable coin shows 365 days.

>> Gentlemen, gentlemen, gentlemen. Welcome to Stabled Up episode number 13, our premier weekly stable coin show presented by our good friend Fra. We happen to have Sam on the show today with Rob Montgomery of Infinifi. Guys, a lot going on in the stable coin space. Um, we've got uh Standard Chartered news. We've got DTCC news. We've got Dcoan news. We've got a lot going on. Sam, Rob, welcome back. >> Thank you guys. >> Hey, always a pleasure. >> Good to be back. >> All right, guys. Where should we start? You want to talk about Docoin a little bit? Now go.

>> I just did the math for you. >> So Andy, that 40,000 you lost. >> Yeah. So Do Quan is the 15 years he's spending in prison every seven minutes is equivalent to that 40,000. >> Wow. >> Yeah. >> Wow. >> That's how much money he lost >> in terms of like the total market cap that he like >> Yeah. the 40 billion you convert it back to minutes. Every seven minutes he's paying society for $40,000 that he lost. >> Wow. Sam, I gotta think you got a uh US story over there somewhere. I don't know how much you want to share, but I I gotta think you were in the trenches,

man. >> Oh man. Oh man. I uh yeah, I don't know if this is the best time now that it's all the the book is thrown and you know, all this stuff, but I think I think it's good time to put some some of it out there. Uh as as people might or might not know now, it's been years, right? Um, you know, FRA is and and was back then uh the second largest essentially like decentralized like quasi like hybrid algorithmic stable coin. Now, you know, we have our FRAUSD genius compatible stable coco. In fact, I would say that event really really shaped us to create a safer stable coin as our flagship product rather than uh a decentralized one. The way that I would

actually put the collective consciousness of the industry is until Terra blew up, right? Everyone in crypto from like early like 2018 ICO era and like basis, if people even remember that name, uh, FRA and then Terra were trying to find the holy grail of stable coin design as like this hybrid algorithmic kind of stable coin that has all the best properties of Bitcoin, right? It's decentralized. It has no blacklist. It's all onchain. and it doesn't need a bank account to to work. But it also has the USD unit where the the unit that everyone needs, wants, they they uh do their accounting in and all this stuff.

And the the the holy grail stable coin, you know, design of algorithmic, you know, scalability. And the stable coin trillemma, if you if you guys remember, was like this is like, you know, did Terra solve it? Did Frack solve it? You know, maybe like someone else can solve it. Um and then it imploded with, you know, like you guys said, 40 billion of of capital. wiped out and it was like no actually maybe the best design for a stable coin is extremely safe digital dollar and that's just what a digital dollar needs to be on the blockchain is it does need a bank account to work and for real decentralized assets that people want to be fully non-custodial and fully in the crypto ethos you have BTC and ETH so I think that's a important caveat that actually left in

people's minds but where should we start the four pool the other pools the the OST uh backstories like I am uh I'm a multi- saga volume book of you guys can open wherever you want on whatever chapter. >> Yeah, I think the forpool uh on curve is particularly interesting because that was the initial tell that US was having some issues. So this was like in in June 2022, we saw that the uh balance between US, USDC and USDT in the three pool started really getting imbalanced and that's when like you know the the sirens started going off on Twitter. So maybe we can start with some of the four pool

you know you were pretty deeply involved like did you know before other people like how did you see this play out? Um how did you manage risk for fracks? just talk to us a bit bit a bit of like the war room stories there. Whatever you feel comfortable to share. >> Yeah. Uh first of all, it was May 2022. Um and no, we actually had no idea. Uh it was equally as surp I I would venture to say it was more surprising and and like uh the entire thing was basically um literally in an instant, right? When you look at the chart, it's like like the crazy DeFi charts, it's like right? Just straight up, straight down.

And the the interesting thing about the whole like Terra saga is that I think unlike FTX, everyone kind of understood that this is how it worked, but that it like didn't it shouldn't work in a pure in fact like it shouldn't work at all, right? Like how did it even get get to that far? And that's pro pretty much I think the point of the whole story that people are like it it had to be some kind of um you know uh lying and things like that to get people to be there. In fact, FRA's entire premise with the original design is that a raw algorithmic stable coin does not work

like the do not actually go in that direction because that is absolutely ridiculous, right? And so, um, our actual premise of like existing in the original design of the first product that we built was that literally, uh, this is the the one that's the raw algorithmic stablecoin is crazy and it's not going to work, right? And so, um, I guess, you know, we saw that unfortunately in May 2022. >> We, yeah, we did. Yeah, we did. Well, Dwan's got 15 years now. Um, he's going to serve half that sentence in South Korea, half of that the first half in America. Uh, kind of an end the end of a chapter there for um the industry. And kind of SPF's behind bars, Mashinsk's

behind bars, Dcoan's behind bars. Um, that's it. I mean that was those were the three culprits amongst you know you ought to think a lot of people got off kind of uh doing similar things at smaller scales or not you know blowing up as bad as those three but there's always the scapegoats and uh those are the guys that that got it. Let's move on to uh DTCC getting a no action letter from the SEC um uh yesterday afternoon. Uh so about like 15 hours before this. Um Rob, maybe you can just set the stage here uh on your side >> for what this means and then we can hear from Rob M um from his side and Sam.

>> Yeah. So I I think first and we talked about this a little bit before Sam and Rob joined. Uh it's important to recognize the scale of DTCC. This is the largest settlement platform by volume in the regulated markets. They do quadrillions of volume. So, we talk a lot about trillions, but DTCC does quadrillions and now they've got clearance from the SEC to go and tokenize some of those assets. Um, I think this is huge. I also realize that they have been building out this Hyperledger consortium chain. And so there's not really an L1 that's poised, and maybe Sam and Rob have have their own opinions on this, but from my perspective, it's not really an L1 that's poised to gain a lot of settlement volume. They're going to be

doing it on their own accord. But what this does show is that we're going to get composability between the regulated markets and the DeFi markets. And I think this convergence is going to lead to a an absolute just significant increase in the amount of liquidity that are flowing into the assets that we have. And I I do think this is going to be mostly contained to stable coins, Bitcoin, ETH, and maybe a hand select few other assets that are going to benefit from this rise in liquidity. Um, Rob, Sam, maybe you guys have other other perspectives here. Would love to get your thoughts.

>> So, I definitely agree that it's going to see a uh [clears throat] a lot more capital coming on chain now. There's a much clearer regulatory pathway for that to occur. I don't know a terrible amount about how this hyperledger setup is designed. What I do know is that in my opinion, most of this will eventually acrew back to ETH L1. However, that's done uh synthetic bridging uh various people, you know, setting up their own bridge between the two.

I think you eventually see it trickle over to ETH just because that's where there's the most liquidity currently. That's where there's the most uh long-term well support and stability. People are kind of getting tired of the L1, the L2 games and they see that yeah, this really is the biggest store of value, the most secure venue for these sorts of things to be executed on. And I think the main impact for the world that I'm in at least is going to be that we're going to see a lot more RWA uh borrowing, lending and borrowing against these assets in this next year.

For me at least with Infinifi, that is very exciting for what we're doing because one of the new yield sources that we're aiming to tap into in 2026 in addition to various different lending products that we're exploring is both the direct subscription to and the liquidation of RWAS. direct subscription too. Obviously, we can make a pretty good yield from putting money into these things and creating almost a sort of hybridized structured product where we're earning the yield on them and able to scale our returns that way. But also, the liquidation of is really interesting to me because it's a completely unsupported part of the sector right now and that

there's not a lot of people who can warehouse the duration on these assets. That is to say, when you have an RWA that's been tokenized, it usually has some sort of a redemption period associated with it. Most people are not going to set up curb pools on these assets. And so, you need somebody who during a liquidation event can come in, buy that RWA at a discount, warehouse the duration until that redemption occurs, and then pocket whatever the spread was on that liquidation. Infinify is purpose-built to hold assets to maturity. That's our entire line of business.

And so with the scaling in this well we become one of the uh the lynch pins to facilitating that scaling and we can also make a very very large amount of uh you know spread off of that. We're talking like 40% average >> yeah sort of liquidations. >> It it's actually interesting here guys uh on that note uh Rob it says DTC is authorized to offer a limited production environment tokenization services across L1 and L2 providers. DTCC will provide more details about onboarding requirements including registering wallets as well as the approval process for L1 and L2 networks in the coming months.

>> So like one one thing one thing I want to just say about DTCC for for viewers that aren't familiar uh they literally hold and settle 99.99% of US securities. And that's just a funny fact to just like think about for a second is like how did regulation get us there where there's one private company that literally entirely settles 99.99% I think it's like something like over a 100red trillion or something of because every single stock in in in the entire US stock market and then most of bonds like literally the story is that the physical certificates when when like they used to trade them on the actual

New York Stock Exchange floor when things started to get digital with like actually like tapes and then later the internet and stuff. Literally DTCC held the physical stock certificates and then they would move them around instead of just literally hand by hand every single trade. But it's just really funny that uh regulation, right, like the the SEC, all of these things that were like, oh, it's like, you know, orderly markets for competitions that well, it's like, well, here's this example in the settlement arena, right, where there's one private company. You you could maybe say this needs to be a public good. It needs to be like nationalized, owned by the US government or whatever. But this is a private company that literally does the

entire settlement. not the vast majority, not a not like a sort of monopoly, but the entire thing. And so what's interesting to me with now with this tokenization stuff is how will the tokenization uh actually look? Will it be like the the same way that they do paper certificates uh and like tokenize them like kind of right in in the digital aspect of settling them between like broker dealers and things like that or uh is there some way for them to free float like float around freely in these L1s and stuff like that? And you know one thing with with us at FRA is we're we're an issuer obviously of a stable coin FRAUSD but we also have our Fraal blockchain. And one of the interesting things is if these stocks are like

whitelisted like restricted, if we can actually get uh the the Fraal like chains uh proxy bridge right on on Ethereum actually whitelisted to move these assets there uh because the chain is is by by a issuing company then those could be traded on Fraal chain. uh they're not literally securities. They're obviously representations of the securities, but they are literally backed by the DTCC's like own securities token, which is literally how the US financial structure works exactly in that way, right? And so we've been thinking a lot about how to get really good pairing uh of like FRAUSD liquidity against these new assets because that's

where I we think the market is actually going, right? Like if you think about uh why Tether is so big, USDC is so big, they are the pairs. They are the liquidity pairs for their generation, right? Like that's why USDT is the centralized exchange. Liquidity pair, it actually that's the problem it solved, right? USDT made all of the BTC and crypto pairs on centralized exchanges way way way back in the day trade instantaneously instead of having uh arbitrageers have to send wire and then withdraw it two days and then send it to another exchange plus two days and then try to arbitrage over four days prices that move in crypto uh 365 247. Tether made them immediate. You withdraw the

tether, you send it there, right? And then USDC did that for DeFi. Well, who's going to do it for this next generation of stocks, bonds, as Rob said, like assets that have duration? What are the liquidity pairs there? Um, and I think we have a really really interesting um few things to release in in Q1 that uh will answer that for FRAUSD, our own stable coin. >> Yeah, very, very well said. And Sam, I just want to fill in one one thing that you mentioned there, which was essentially this this stamp of approval. Wherever the security, the financial security goes, whether it lives on DTCC settlement network, their own internal blockchain or if it starts to permeate into the DeFi ecosystem, that stamp is called the CUSIP.

It is a nine character alpha numeric code that identifies a North American financial security for the purposes of facilitating clearing and settlement of trades. And so this was this is a regulation standard that obviously DTCC has and they've internally done it for their own settlement engine for 99.9% of the financial securities that are out there. Hundreds of trillions of dollars of securities. Now that same stamp is going to apply to assets that they can that will start to permeate into the blockchain ecosystem. >> Yeah.

Tokenization, man. It's it's it's happening. Um and it's happening globally. Um Sam Sam, you also, you know, in your in your kind of uh outline of the frack suite, you didn't mention Fracknet, but I wanted to ask about this Korean wand stable coin that you guys started to collaborate with um from uh the trying to, you know, basically trying to make the the Forex onchain um market more liquid, more available, more kind of uh transparent, global. Um, so you guys recently announced that you will be working with KRWQcash, which is the most traded Korean wand stable coin. Um, and so they will be joining into your genius compliant stable coin network.

I'm curious how you think about this forex market and from both of your perspectives, how big this can really get, right? So obviously we've seen the proliferation of US dollar stable coins. I think next year is going to be the year of non US dollar stable coins. Uh there's five or six European banks that are getting together to launch their own uh European kind of like mandated the euro stable coin. It's it's looking like the end of summer next year. Obviously KRWQ is is on track for Korea. We were with Fede and some of the guys in Buenos Aris uh a couple weeks back. They're launching an entire slew of stable coins for uh Argentina, Brazil, Colombia, Venezuela. I just think next year is the

year of the nonUSD stable coin. How do you both think about forex onchain? How do you both think about bringing this massive market onchain? Um, and how do you kind of see that happening? >> Yeah, for sure. So, the KRWQ Korean Juan stablecoin is by the IQ team. Fracks is the issuance and infrastructure uh provider for it. just like how we're doing stable coin as a service for uh mostly USD but but a uh Korean one uh stable coin is exceptional um and we've integrated it into FRA at our neo bank layer where people can sign up have wires in and out uh stable coins like FRAUSD but also soon KRWQ which is super super cool. I think that exactly what

you said is true where 2026 will be the the year of non USD stable coins. I don't want to make this mistake that I made with prediction markets. Prediction markets, I've been in crypto since 2014 that every single attempt. Uh, you know, Augur was the first uh Ethereum ICO, you know, then there was like Omen and then there's a bunch of others that I don't even remember. But every single time people tried it and it didn't work. Uh people were like, "Oh, you know, prediction markets are a niche um thing. Maybe they'll blow up every four years because of the, you know, worldwide kind of event that everyone pays attention to, which is the US election." And then actually Shane at at Poly Market was like, "No, hold my beer. It's actually the biggest thing on on the entire world, right?" And so, uh, I think that,

you know, everyone keeps sharing the chart of like 99%, you know, USD, uh, stable coins is like the stable coin dominance. I think like it'll still obviously be like 80% dominance because that's literally what the dollar is right now, 80% of global trade. But that means that non-USD stable coins will 20x if it even looks anything similar to the global trade of the classical you know analog assets before they they were tokenized right and so it's going to be huge particularly Korean wands are actually uh if you didn't know this they are last year they were the top trading asset even more than USD they were the most fiat trading asset because all of Korea trades against Korean want I think

it's actually like a regulation thing and so like up and bit and all of these Korean exchanges they have to have KRW pairs and so I actually think the the second biggest opportunity after non-USD stable coins is actually the Korean walk which is why we thought this was so exciting of an opportunity to be uh KRWQ's like issuance and infrastructure partner but everything else is going to be growing uh you know euros um you know Singaporean dollars etc etc and so I think once those come on chain we're already seeing DeFi being built around them. Like the other day I saw someone was doing um I think it was uh I think it's called Autonomment and I I just saw it. I don't not affiliated at all. They are doing

like um carry trade with FX to get it's like Athena but with different um FX pairs as like the collateral. Um this kind of stuff is going to grow a 1000x um onchain. And so I think 2026 will be the year like prediction markets it was 2025. Um and so we're really excited to be at the forefront of that with FRAUSD and KRWQ all integrated into our uh Neo Bank platform. >> And real quick there uh is KRWQ then a Genius compliant stable coin is >> No, no, no. I mean, Genius only applies to stable coins, which basically means you could go in and out into KRWQ with Genius compliant stable coins like

FRAUSD. But it is uh it is entirely Korean thing. Yeah. >> Right. Rob, what what's your take on this uh from more kind of like DeFi side? Do you anticipate >> these kind of tokenized versions of these non USD assets or stable coins coming into Infinifi to other DeFi platforms? How do you kind of see this playing out? I wouldn't see us directly having them as deposit assets um at least not in the next 6 to9 months but the way that I see this as interesting is global trade and uh particularly trade receivables so [sighs] the forex market is definitely starting to proliferate on chain and what that means is as somebody who does duration assets I've been on the lookout for

people setting up things that look kind of like what I think Huma was trying to do earlier in their life. I'm not sure if they're still doing it, but I know that there is a market here because I did some research into it a few years ago. And the long story short is you have what's called invoice financing. You have what's called trade financing. These are relatively short-term opportunities uh frequently denominated in a foreign currency where a traditional wire actually loses a lot of efficiency because of you know local fees because of um inefficient forex. If it's a small denomination like a lot of these invoices are around $2,000 a $45 wire fee is going to eat up the

entirety of the profits you can make off of performing that trade. But if now you're able to do this these recealables financing, this trade financing using stable coins and if you have efficient onchain forex that allows you to open forwards, you've created a really good duration asset that can yield somewhere between 12 and 24%. Depending on what the cost of your hedge against that uh currency's volatility is and I mean this really ties back into the RWA sector. You want to know what the the really most exciting avenues that stable coins and foreign stable coins in particular are going to be opening up. It's these duration opportunities for short-term loans to

countries that have much higher interest rates in their central banks than we do mean that there's a lot of money in these trades. It's just not profitable to run them without stables. like a Turkish stable coin like a Turkish LRA stable coin could be an interesting thought experiment with regards to how what you're describing because it's so high or or maybe like >> Brazilian realale was actually what I did my models on when I was looking into this like years ago. It was showing 24% APR. >> Yeah.

>> And you try to run that with a wire fee. You're talking about a $45 fee for an international wire. Your average receivable is $2,000. What you're doing is you're basically like someone's going to deliver goods with their truck for the next month. They deliver the goods, they get paid 2,000 with an invoice. That invoice won't be cashed in until the end of the month. They need the money now to go make more deliveries. Yeah. Front them, you know, >> $1,800. You You're making 24% off that 36% in Brazil.

>> But if you got that wire fee, that kills your profit. $45 is 24% APR if you're having to send it every month. >> And the time cost of money too with the, you know, couple days in between as well because usually those people want the money like now. Like the whole point is so that they can reinvest into their business or go pay their suppliers or whatever it is. >> And if you've got really good onchain forex, you can automate pretty much the entire thing. So Robbie, we heard from um um Luca from M0 and Hanoen from Codex about why like Hanoan was bullish on uh on Jane Forex, Luca was bearish. Sam, I'm curious to hear your opinion on on this bare thesis. Uh Robbie, I think you can probably say it better than than I

can, but but I can give it a stab. >> Well, I Well, I can put it pretty simply. It's that there aren't a there isn't a lot of liquidity in certain forex pairs. For instance, you can take two countries um with, you know, rather esoteric uh currencies and they don't have a lot of liquidity between them. So, they have to route into the dollar, the US dollar, and then route to that other currency. Um and he used, you know, uh South American and I think a Eastern uh Asian currency as examples uh that of a currency pair that they would have to go from currency A into the dollar and then to currency B. they couldn't go to A to B directly, but we have DeFi, we have AMMs with stable coins and enough liquidity in those

assets, it could make more sense to go directly to the the second foreign currency rather than routing through the US dollar. Um, and you know, the point here was essentially that this takes an incredible amount of effort to unravel because there is so much of a moat in the US dollar. And you know part of the benefit is that you have all of these flows routing through the US dollar. Um and it it really is uh this denomination and reserve currency in that aspect. So we we heard some conflicting opinions.

You know some people said that this could happen onchain and it could happen onchain sooner rather than later. Other people thinks you know think that this is not able to really get unraveled at all. If so it's going to be a decadesl long process. So Sam, have you thought much or or Rob, you know, maybe we'll start let's start with Sam and we'll go to Rob. >> Yeah, I we've actually because of the KRWQ guys that that were helping uh issue this thing, um we actually have an intimate understanding of this because every single country has their own esoteric like capital controls or sort of capital controls. Like for example, Korea like you can't move Korean Juan into a outside bank account. you need to

actually have a local bank to hold Korean Juan. Now, there's interesting ways around that to create a Korean Juan uh stable coin by holding Korean uh treasury bills in uh accounts that are um not in Korea. But every country has their own like uh requirements. And so the US dollar is basically the most most free asset in in the entire world that basically has connected to all of these as like a literally routing pair, right? And so I think that there's there's two types of uh things this says about the structure of the market and and non-USD stable coins. One is it's a winner take all even more than what people are seeing in the USD uh market with like

tether and USDC. Um it is literally there there's going to be like just a tether of Korea, a tether of Brazil or you know tether of Turkish lera because these use cases are extremely important and and being like the Korean one routing pair or the you know um Brazilian real or you know the Turkish LRA routing pair and there isn't a long tale of niche you know uses for like a thousand USD stable coins like there's going to be right like like the Clara USD this USD Starbucks USD this and that and uh that's not going to happen with all of these other uh countries that that's why being first for example with KRWQ is so important. they're all going to have onchain liquidity and it's just

going to be more and more uh you know powerful, right? And and no one else is going to need or want or should even to create a second uh Korean Juan or Turkish LRA and that that token that stable coin is going to be so liquid it's going to be able to trade onchain against other non-USD stable coins. It's going to be in DeFi and it's going to become a very you know consolidating asset. If you think Tether is dominant right now, just wait until like these non-USD stable coins really get going in 2026. And whoever the current first mover is for each of these units, um, I'm willing to bet that, you know, we can come back in a year, December 2026 from now, and look at the the chart and

I will bet 99% dominance of one single issuer for each of these pairs. >> I would agree with Sam on that. I think it is really a winner take all scenario at le very least winner take most >> DTCC style DTCC style >> oh Jesus Christ crypto is meant to solve that no to me I don't see any reason why the onchain market wouldn't eventually dominate and supply the offchain I definitely don't see any reason why at the very least it wouldn't start up you have you're going to have a decent amount of flow just because people want to do I mean Like Sam's talking about basis trade, you okay, who's going to take the

other side of that? Well, if someone's doing trade receivables, they're the one taking the other side of that. You have genuine organic demand for the ability to long and short these assets already. Right now, it's having to route through off-chain systems, but a decent amount of the capital flow already comes through onchain. People will want to make that even more efficient. If you go and you look at one of the other big uses of stables at the moment, it's store of value. I ran into this a decent amount down in Argentina. I ran into it years ago in Colombia. People do not like uh at least people in our generation, actually people in the old generation too, they don't like keeping their money, their life savings in uh in their local currency because their local

currency has a bad habit of going under every like five to seven years. They don't keep it in their banks. Um if they kept it in their own currency in their banks, they lose it when the bank goes under. They keep it in cash in US dollars often and they keep it under their mattress which is a really terrible solution. So you've seen is you've seen this proliferation of people who are allowing you know these normal everyday folks just keep their money in US dollars via whatever app it is whatever wallet that's hooked up to you know a credit card I'm sorry a debit card. That debit card converts the the dollars to the local currency at point of sale and it's a very easy user experience. Those sorts of systems right now rely on Visa

and Mastercard to perform that forex swap to perform that conversion. And I don't know the exact fees involved, but I would be willing to bet that Visa and Mastercard are taking a very pretty significant cut to do that as they do with any foreign exchange. The minute you get onchain liquidity and you can go from USDC that you're keeping your money in or tether as it's quite common overseas to your local stable coin then go through your local payment provider to uh convert it back to your typical currency. You're going to get a lot lower slippage. You're going to lot have a lot higher efficiency. These

onchain forex pools get flow. Uh so they're very happy and the only one who loses is the uh the existing giants of the payment processing world. >> Yeah. >> And I think they feel that and I think they're coming on then they're coming around to it. I mean Stripe with Tempo um I think uh Interactive Brokers is starting to accept stable coin payments as of today. Like they can feel it. Um >> they're going to keep taking their cut. It's just going to be >> Oh, for sure. But I think you you bring us to a nice a nice uh a nice segue here which is uh our boy Sam has been recently appointed as a advisor CTO shadow founder of stable. Um we are investors in plasma. We were euphoric

for the first couple weeks. We are now the uh butt joke of crypto twitter. [snorts] Um tempo's test net has came out. Stable mainet launched and token launched. Lot of drama. a lot of people mad about the token and the allocations and the pre-eposits and yada yada yada. And then ARC is still kind of like this little, you know, thing in the corner that's just kind of watching it all unfold. Tempo's like the big brother here and like stable and plasma fighting. Um, let's talk stable chains, guys. We haven't talked uh stable coin chains probably in for I mean Sam maybe since like the first episode that we did. I know you have a kind of like not like a bias but you have a role. We have a bias. Uh, so just putting those out

there. Um, but I think let's start with with Tempo and then we'll get to stable and then we'll get to plasma and we'll get to Arc. Tempo testnet launched. I just can't help but think Tempo is going to mog all these and that Tempo is going to is coming straight for all of the payments chains and I'm scared. Um, I'm scared that that Tempo is going to come in with Stripe dist like their distribution is massive. Their technical team is insane. their entire uh uh fleet of uh product decisions in terms of their um subblocks, their uh consensus mechanism, etc. is really really solid.

Um they will not launch their own stable coin. They will support a lot of of stable coins likely including FRXUSD. Um what's our take on Tempo Testnet? Uh what do we, you know, what do we like? What do we dislike? Uh and then we can get into some of the others. >> Yeah. So, uh, obviously, let me let me take as many hats off as as possible as you guys said. And, um, same thing with probably everyone on this call. I didn't know you guys were investors in plasma. That that's, uh, pretty pretty cool. I I think there's going to be a lot of these things. I did take a look at Tempo uh, test net fra uh, is a FRAUSD will will be an issuance partner. This is all in in my opinion. Positive sum if people want to play the positive sum game. not

obviously uh everyone is um you know bear hugs and and things if if there isn't a you know both sides interest tempo has some really cool tech uh stable will also unveil their ve very interesting roadmap that uh we we do think is is novel that no one else will will do and not even uh tempo um but tempo's tech if you go look at it the the way that the actual uh payment lanes works the the tip 20 standard and the reward streaming that they've built and the actual gas market where in tempo there's certain things that I actually um as like a engineer and like someone that uh still writes code I'm very very intrigued about the decisions that

they've made and I'm excited to see how that goes. Like for example, there is no ETH payable gas in the EVM uh in Tempo. I don't know if you guys have looked at it your listeners, it's super new. It is literally the the actual low-level call to like pay gas is it can be denominated in any preferred stable coin or the validator quotes in uh whatever stable coin that they uh want to accept. And like if you low tempo network on MetaMask and or like Rabby or any of these things, you know how all of the networks they're like gas like quoted like token says like this ETH balance for your wallet that doesn't even exist in in Tempo which is really mind-blowing there there's no such thing as a single

uh gas like token and like the it is EVM though, right? And so there's so many changes um there obviously like I'm I'm excited to see stables. We have one with Fraal that has zero gas and and things like that for FRAUSD and some of these other products that that we're building. It's going to come out in Q1. There's just going to be so many. I think the most interesting thing is who gets the actual um distribution and the and the customer base because that's where all of the flows are. These are these are things that are monetizing flows rather than uh aumumumumumumumumumumumumumumumumumumumum right chains monetize flows and settlements. So >> Sam help me understand something. Um people are futing stable coin chains in general and saying okay so plasma set

the standard already saying gasless everything. So there's not going to be any transaction fees on stable coin transfers. Um that's going to be probably ubiquitous across all of them. Uh so like the revenue or rev from a typical L1 won't won't exist like you you won't be paying ETH fees or soul fees or you know L2 fees to you know use these. So then how do these things make money? Well it's like okay then they can be valued based on volumes I guess almost like a settlement layer engine kind of like a DTCC like does that make sense? Like how do how do you think about stable plasma tempo arc? How do you do about these things making money?

um they're if they're doing these gases, stable coin uh transfers, what metrics should we be paying attention to to like uh measure their success? Obviously, TVL is one. I think Plasma is like top six or seven right now in TVL, but of course, they had this massive liquidity uh you know uh generation event uh that has now kind of uh subsided. How do you think about uh the difference between normal L1's and L2s versus what these things are doing for like metrics to watch and how to value them? Yeah, I I think I think the true gasless fee transactions, whether it's like stable, plasma, tempos, payment lanes, you know, yada yada yada, they're all limited, right? Like you there's no such thing as

infinite uh free transactions is literally physically impossible. So I think the most important thing is those are subsidized ways to get more flow into these these uh networks and some of them are by issuers like ARC by uh USDC Circle, right? And so if if everyone's using USDC right and and ARC is super fast and super good and mostly free not like infinitely free then basically USDC is is and I think in their uh view dominating because they are able to monetize the stock the TVL the AUMUum of their their stable coin and so um same thing with the chains that have relationship with tether right if you give a lot of very very cheap fast uh

movements of of tether tether Tether benefits a lot and it is an interesting question of like what are the chains doing? I think the chains are literally monetizing flows rather than the stock or the TVL uh which is what usually a stable coin issuer uh monetizes and so the the relationship between the issuer and the the chain team is the most important like answer of like how they're going to make money. >> Gotcha. Very cool. Rob, any anything to add there?

>> Yeah, personally I would say [gasps and sighs] my look on these chains, it really varies across the different chain which one we're talking about. Uh, obviously I am still a fan of Plasma. We are going to be deploying some crosschain infrastructure in the new year for Infinifi. And as everyone who's been following us knows, we had planned to deploy to Plasma in November. Obviously, the yield situation there got a little bit uh well rough in the fallout from the stream incident. So, we basically let the dust settle. Plasma still seems to be going just fine. So, we're planning to be there sometime in the early new year and we're also

planning to start deploying across some of the other chains that are flying around. >> [sighs] >> That all said, when I think about plasma, I think about their angle is more of, [snorts] at least from my perspective, it's more of a neo bankank one versus when I think about stable, I think about transactions. I think about settlement. I think about uh more money moving around. Plasma is a great way to access the entirety of DeFi. It's their selling point is you are looking to deposit into DeFi. You don't know where to start. we can help you. And that's why you have these sort of single point of origin vaults that Plasma just shows right on their homepage.

They're selling to a different person than somebody like Stable who's really looking to engage with these payment processors with and ARC is also taking that exact same tack. Tempo, I mean, they've got, you know, they they uh is it Gon. They're really good. No, it's it's uh Dankrat. There we go. Dank sharding. They got Dankrat. And I've interacted with Dankrat before. He's brilliant. Um long time ago helped me keep uh self-destruct from getting totally deprecated, which I was very grateful for for my protocol at the time. Would have bricked the entire thing. A really smart guy.

But from what I can tell of Tempo, it's basically it's the incumbent trying to show up and trying to basically grab market share in something they view as challenging their market dominance. If we look at historical attempts to perform those sorts of operations, usually they don't work out well for the incumbent. There have been entire books written about this. The uh the one that I would recommend most people read is uh the innovator's dilemma.

And the general thesis there is that by the time the incumbents realize that a new technology is challenging their hold on power and begin making moves to dominate that technology, it is already too late and the new winners have already been chosen. >> Yes. >> Yeah. >> Ethereum and Bitcoin coded. >> You get it? >> You can see this with Caterpillar. You can see this with IBM. >> Yes. >> Like those are just the two first examples I think of. Caterpillar, they crushed everybody who was doing like, you know, cable construction equipment.

>> Yeah. >> Uh IBM, they got crushed by the personal computers. Oh, mainframes of the future. What's this PC? Who cares about this? >> Yeah. >> Dead. >> Yeah. Well, I'm looking forward to seeing how this kind of race continues to play out. Um I think we'll have to continue to monitor monitor the situation. Uh what's that meme? I'm monitoring the situation. Um Sam Rob, guys, I I think we're coming up on time here. Um didn't realize that we had a had a had a tight one here today. So guys, thank you so much for joining. Um Sam Rob, it's been a pleasure. Uh stable up episode 13. Shout out to the amazing people from the FRA team. Lots to cover in the stable coin verse. So uh glad that we could make it happen today.

>> Thanks guys. I will keep monitoring. [laughter] >> Monitor the situation. Pleasure guys. >> Cheers boys. See you next time. >> See you. See you. >> Monitoring the situation. >> I am monitoring. >> All right, guys. We'll be right back. We're going to get back to some of the new stuff. Take a quick pause. See you in a sec. Peace. [music] Yet is built for big moments. The most fun you'll ever have with your crypto.

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Go to habachi.xyz [music] to start trading today. [music] >> [music] >> Welcome back to AI Supercycle, our premier AI show airing every single week presented by Near. We cover the ins and outs of decentralized AI, privacy, and the future of this massive technology. Near is the blockchain for AI and the execution of AI native apps. You can check out Near's latest AI product at near.ai. AI. Sit back, relax, and enjoy the show.

>> Welcome back, Yan. Welcome to Rollup TV, man. Good to have you. >> Yep. Hey, thanks. Thanks, Andy. Like, um, glad to be here. Like, uh, yeah, I I think like this year 2026 has been just like, um, very exciting on the AI front. So many new things are happening. Um, very excited for the year ahead as well. So yeah >> definitely, man. I mean, it's been the year of AI. I actually tried to um predict on on Kshi that um uh this was going to be AI was going to win the time person of the year award, but I think something just leaked yesterday and it's not. Uh but we're on AI super cycle.

Welcome to AI Supercycle Tang presented by Near the Leading AI blockchain. They just released their Near AI chat product as well as their Near Cloud. Uh so you can actually have an LLM that you use and speak to uh that is not storing your data using it for training or giving it to the local jurisdiction of choice to put you behind bars. We are not going to do that today. Tang, we're going to have a fun time. Let's start at the top. Tang, who is Ten? How did you get started in um uh kind of researching and creating content about AI? I'm a big fan. Um so thank you for joining us today.

Yeah, you know, thanks for having me. So, you know, before and not too many people know this, but like actually before getting into crypto full-time, I actually spent quite a bit of time in the AI space and and that was of course um pre-Chat GPT. Um I you know co-founded a healthcare AI company back in 2015 and we were doing very traditional machine learning on very unstructured data which was mostly like clinical notes, doctor's notes and from there we sort of like built platforms that help um pharma companies run some of the studies in in a more efficient um sort of way. Um so that was really where I I spent a lot of time getting to know like the know what was happening in the AI space. Um and then yeah went

full-time into crypto. Um worked with Deli Digital doing a lot of like consulting research um in the space. Um my focus was a lot on the consumer side of things like consumer applications uh gaming NFDs and stuff. Um but I would say like sometime around like two years ago I started to notice that hey you know what was happening in the AI space was really starting to take off. like if you use some of these products at the time it was probably like chat GPT maybe you know GPT3.5 or something like that um and you could see that actually it was able to you know start to do some very amazing things like things I never expected that we would able we would be able to do um so that made me realize that hey you know there's something here that's going on I

need to dedicate as much of my time as possible um to understand what was actually happening in the space um so yeah that's where I I left Deli um started like researching into what was going on. I would say um the thing that really brought me into this space was Bit Tensor. I think it was as I was looking like what people were trying to do with this um it was just like so fascinating. Um and when I started researching about it, started writing about it, um you know, I kind of realized that it was kind of like difficult to get out of this rabbit hole. And you know, it's been a year and a half. I'm still spending a lot of time looking at what's going on and still learning new things every single day. So that's >> yeah exciting.

>> That's the beautiful thing about AI is that it just it it's never ending rabbit hole. Um it's just a never ending rabbit hole. And I mean I've scratched the surface but man is there a lot more to uncover. Um so let's kind of start on a on a on a more broad here broad note here w with regards to the evolution of the last year or so. Um I is there a particular sector of the AI uh category that you feel like has accelerated far faster and far um you know uh more effectively and efficiently than others this year? Like you know has the has the model uh improvements this year just been so much better than anything else

in AI? Has the uh ability to uh have actual like memory in certain LLMs been so much better? Like is there a specific part of the stack that has really really improved this year that you can notably point to and be like this is why uh your tangible experience has become a lot better this year. Kind of give us the uh lay of the land as to where the major improvements across the general LMS happened this year. >> Yeah. So, you know, I think uh it is very obvious that um especially been you've been using some of the AI tools that things have improved a lot like over the last year um >> compared to just about a year ago and a

lot of it has been driven by better and smarter models like the recently released like Gemini tree I think is kind of like blown a lot of people's minds away in terms of just how fast and how good it is at doing um more complex um task. Um and I think a lot of it is driven by just a relentless drive of improvement throughout the industry. If you look at what goes into an AI model, right? There are probably three main components. There is the data um there is the compute and then there's the actual algorithm itself and all three of these frontiers are seeing like constant improvements. We're getting better data.

People are producing more and more like relevant data, synthetic data even to train models around like very certain task. um we're seeing like bigger and bigger data centers being built out to train these large um and larger AI models. Um and then of course like all the researchers are also doing um um looking into how we can improve like the algorithmic efficiency of like training of these models, right? So all in all like it means that the scaling laws of of AI are still pretty much intact which means like the more data we put in the more compute we put in the more um efficiency the more improvements in the algorithm we make like the smarter and better the the models and the LMS will be and we've kind of like seen that with

some of the latest models that out there. So I I think we're going to continue to see a lot of these like very steady improvements. Um I'm going to I'm expecting um newer better models like throughout like 2026. Um many of the major labs like OpenAI have already committed to releasing like um their new models on a more regular basis. Um so I think it's just going to be a good time to kind of like see. So I I think like things are just like fully um [clears throat] fully charged. Um and that has really driven I would say like uh a lot of interest and growth in uh particularly the AI agents kind of like space because like um ultimately um AI agents are very constrained by what the

the models that power them can do and with these new and better models I think we're going to see them be able to do a lot more task um and maintain that focus over a longer time horizon. >> Yeah, I love that. I I haven't tried to use the um Google Gemini uh Pro 3 yet. I'm sure you have. Is it as good as everyone is saying it is? >> Yeah, I I think it's it's to me like um I've actually always been using like many of the Gemini models. Um I kind of like split my time between like chat GBT and the Gemini stuff. I use chat GPT for like easy, you know, easy queries and I use Gemini for, you know, slightly more complex stuff. Um, and I think like definitely what we've seen is that the the new Gemini 3 models have been able

to are much better at following your instructions. Like if you give them a couple of things, you ask them to do a few things in a sequence, it's actually able to to follow the sequence pretty pretty well compared to before. So that was very personally um surprising. Tang um when it comes to actually creating positive outcomes for your sequences of instructions when when uh prompting um a given agent, right? And and you mentioned how these agents are going to be uh much more sturdy and uh have better memory and have stronger performance next year because of the uh consistent model improvement. You know, you alluded to Open AI committing to scaling their models quickly, which obviously means that everyone else is

going to try to do the same thing. When it comes to actually prompting models for the best sort of outcome given a sequence of instructions or a sequence of tasks, how have you found to do it the most effectively? Uh either in specific instances or more broadly like what are some of your you know mustd do prompting instruction hacks or tactics that the audience has to know about? >> Yeah, I I think that's a great question. um you know maybe about like say a year back I think the the the idea and the rage that was um on everyone's minds was around like prompt engineering right and the idea

was that hey if you're able to prompt the model well you know get even better answers I think that has kind of um been proven somewhat wrong in the sense that if you realize that today like many of the models are able to understand what you're trying to do even without very long specific sort of like instructions and I think that's kind of like speaks to some of the progress that's been happening in the model development. I think for me personally in terms of like using in terms of like prompting models I think what's important is to understand what you want to produce ultimately what is the outcome define the outcome very clearly for the AI to follow and then all the intermediate

tasks I think that is really um up to you like if you know very well what the model needs to do you just give it a very specific set of instructions um tell it exactly what it needs to do and then it'll probably be able to do and follow your steps and give through the the instructions as you sort of like determine if you are not an expert in that particular domain for that query, you can give it a fairly general sort of like instruction. For example, hey, find me um um like a particular like research on on this particular sector and topic which you're not particularly familiar with. It will actually go through its own sort of like thinking and reasoning.

It will search the different relevant site websites. you don't have to specify exactly where you want the model to be looking at, what kind of like research papers you want it to find. It is kind of able to sort of like curate a lot of that. I think what I find very helpful in terms of like giving me the best sort of like outputs is giving the model the right context. It needs to know like what you what do you want to use it for? Um the good thing is that like chbt >> could you give >> go ahead >> sorry could you just give a quick example of like um a a giving a model context versus not giving the model context and the type of like output you could expect by not doing so.

>> Yeah. So, for example, um let me see like one of the things I do um I use some of the AI tool is like for example um I have some of these like Twitter lists of uh very interesting like accounts that I follow but there are two 300 of them and then I I I basically cut the tweets. I paste it in the model. I ask it to sort of like um find me the most important tweets um that are relevant for me that I need to know so that I don't need to filter through all the noise and all the um random stuff from that. So I I gave the model a set of examples of like what are the kind of tweets that I think are important and interesting to me. I want you to tell me um um tweets where um the startup has

raised at least five million in funding or they're launching a new product mainet is coming up very important event um that they're sort of like running and then basically with all of that context then it sort of like is able to sort of like help me >> um rank and surface out the more important things of that I kind of like want and need. Right? So basically um if I were to just pass it the whole bunch of tweets and ask it to just you know aggregate all of that um it's going to just try and guess what I might want to see. But if I know exactly what I'm looking for if I just give that additional context to the agent it's going to get be able to give me a much better sort of output.

>> Yep. Yep. I appreciate that. And and I've experienced that quite a bit as well in my in my uh you know usage of his LM. So, so you know, you were kind of building on how context helps a lot in this in this realm of of of trying to get better results there before I interrupted and you were you were kind of rounding out your entire thought with regards to the best ways to kind of uh do prompt prompting or prompt engineering even though it's kind of um maybe not as important or was proven to be not as important as people had had thought. So, just if you want to kind of close that loop there. Yeah. Uh I guess I'll just add a couple of comments like on my own sort of like experiences in

terms of using these AI models. Um I think one is that there isn't really any right answer right now. It just comes down to a lot of experimentation. Um for example recently I saw a research paper that said that you know one of the common tricks that people used to use in prompting models was to say um imagine that you are a worldclass um marketer or imagine that you are a world class basically you ask the you ask the AI model to sort of like role play for you in terms of what you want it to do um and the software research showed that actually it didn't actually improve the outcome. For example, if you ask the AI to role play as a physicist and then you

ask it very hard mathematical questions, it would be the same kind of result as if you ask the AI to be like a lawyer and then answer some of these like questions, right? So, I think we're just only starting to scratch the surface of understanding what's the best way to promp these models. Um, so I think it's a lot of experimentation, figuring out what works best for you. I think the other thing I've realized is that the different models actually have quite different personalities. So the same prompt whether you use it in chat GBT or Gemini or Grock, you could get quite different answers. So it comes down to understanding um which model kind of like works best for which particular situation. Um, for example, I think Grock has u I I find

Grock the most creative in terms of like coming out of his outputs, but sometimes it feels a little bit too unhinged to use in a more sort of a professional um sort of like setting or or answers that I'm kind of >> That's so funny. That is so funny. Um uh do do you do you often check the results of what you do across multiple LLMs? you know, I I think I I would definitely love it love to do something like that, especially for for the queries that um are more important. I think basic queries I think most models even chat GPT is actually doing pretty well and I trust actually most of the answers that get but um for some of the things some of the tasks they ask it to do um sometimes I use tools like there's

there's there's something called like yep.ai AI which basically allows you to run the same query across like you know a couple of different models and you can kind of like see the answers evaluate these things and figure out which model sort of like works best. So that's great. I've even seen some systems where you send in a query and then it has like three or four different models um run the same query and then they have another model that evaluates the answers from each of these uh models to give you the final best answer from there which I think is pretty cool. It just takes a bit of time.

>> Have you um have you tried Near's product? >> Not yet. Which which product specifically on Near? >> It's so it's so if you go to Near.ai on your on your computer there, you can you can click in the top right uh uh try it and then you can click uh private chat. Ah yes >> and then click on it and basically it uses deepsek open AAI a couple other models but it's completely encrypted with TEES and with basically uh some ZK and and it is I think it is the one and only current AI tool that is private today like I I think it's the only one

um and so you get all the benefits of you know using these models models the same models that you would use on a normal day, but your data is not leaked to who you know whomever it is. And um you know your information literally could not be given to the authorities if they wanted to because it just it's encrypted in such a way that is so you get all the capabilities of memory of model training data training etc without actually sharing your data. So anyway, they're a they're a partner of the show, of the of the experience, and you know, I just wanted to show it to you. But I I guess it brings a question, you know, are we

so obviously you've got this like Orwell Orwellian viewpoint of AI from some people where it's like um you know uh we're entering the endgame here. Uh what's that book? Is it is it um >> what's the book? uh 19 there there's a book uh that people often refer to as a result of AI and anyway it's gotten so infiltrated into our lives where people are so comfortable giving away their personal information their financial information their social information etc you know it begs the question of like who owns AI who owns your AI do you own your AI who you know who is in control of the of the responses that you're

getting there's a lot questions that we can kind of like go down the rabbit hole on, but I guess like the broad one here is like Tang, do you think that we have an AI privacy crisis brewing on our hands or are we in a fine spot right now? Is it too late? Where are we at? Like are how how problematic is the current state of the public uh AI platforms that everyone knows, loves, and uses? um and and how does that kind of relate to privacy and some of the I guess blockchain ideals that you know you I'm sure are uh aware of and have been a part of in the past.

Yeah, you've outlined a very great point in terms of like where crypto and blockchain actually plays a part in sort of improving AI and that's really around um privacy um today for sure like if you look at if you're just using like CHIP and Gemini basically um you know it's collecting all of this information and data um from you um the thing is that most people don't see it and because the data right now is just being used to train their next version of the model so it's something that's happening on the back end so you don't kind of like feel it. But I think like what's going to happen um pretty soon and we're already seeing some of this with the chat GBT sort of like shopping features that they're going to start to with all the data and the queries that you've been

putting into the model. The model is going to start to have a very good idea of who you are, what your interests are, what your likes are. And naturally, as we've seen with every kind of like business model on the internet, >> we're going to see them start to sell sell stuff to you, right? advertising is has always been the model um that most of the internet has sort of like drive on. So that is where I think the consumer is going to start to feel a lot about where this privacy starts to become very important because it comes very vis visceral to um them and their lives out there. So yeah, no I think anything that that can be done to sort of like protect that um is great. I think um people don't kind of like care too much about privacy mostly right now

because the value that the AI gives to them is far greater than I guess like how they value their privacy. So that's kind of where it is. But I think like for many of us I think it's definitely a concern. I think in this day of age with so many um [clears throat] in a very chaotic kind of like world I I'm starting to feel that privacy is a very important thing and you know very cool stuff that NIA has been doing on that. >> Yeah. Yeah. For sure. Um yeah interesting. Yeah. I mean I think um the whole like legal obligation that OpenAI has to give your information to the authorities no matter what is is pretty insane.

Um I mean that's kind of what any company has in the world or at least in the states. Um >> yeah I I think just onto that as well is that >> you know we only going to figure out what happens when this really gets tested right like when a government actually makes that request that comes then we'll know whether these companies are going to succumb whether they're going to actually share all of the data. >> Oh they definitely will. Oh they for sure will 100%. You don't think they will? I >> I I think they I don't know man. I think some would maybe would try to fight a little bit but uh maybe it's just for show but ultimately right if the government says they want it I think it's really hard especially if your whole company is is in the country.

>> Yeah. Yeah. Yeah. Um cool man. Uh so let's talk about some of the agents that you've seen um excel like uh is there um so look let's just lay the context here as if you were an LLM. the there there's all these agents that we hear about. Salesforce has got their commercial for an agent and everyone's got these agents and I'm just I'm never going to book a flight again because the agent's going to do it for me and like why would I ever book a flight? I'm I'm way too cool for that. I'm superior. You know, why am I going to ever make a reservation for dinner because, you know, I'm going to have an agent do it and they're never going to make a mistake. They're not going to book the wrong restaurant in the wrong city because they hallucinated. That would

never happen, right? And and so we've heard all about this. Uh but to this day, I have no agents that are doing anything for me outside of like prompting back and forth, creating images, videos, um or just generally like giving me like basically what I'm getting at is I'm missing the uh here's the instruction. I want to get information. Okay, now I got the information. Now go do this for me. and like that go do this for me task outside of like whatever their capabilities are from like generating an Excel sheet, generating code, generating an image video, editing a video or c you know giving me like the right clipping mode etc. like the actual action of going to

do something in the real world um if you will like not within the its own capabilities I I haven't really seen um you know give us an update on the agent landscape where we at um it will 2026 be the year of the agent actually having capabilities as I mentioned to go outside of the internal kind of like uh LLM to human interaction and actually go do something and kind of report back whether that be onchain Whether that be book a flight, whether that be uh email a friend, where when do we get the actual uh fulfillment of this promise of agents doing all of our work and these types of things?

So you know I think u I guess a couple of thoughts on that is that firstly um you know we already seeing like AI agents you know be good at certain things and for example things like research like being able to um synthesize um digest a huge amount of information and present the things that are important um you know agents are getting good at coding I think that that's because like you know code is very clear. We know whether it works or it doesn't work. It's kind of easy to tell what's good and bad. Um so we going to see a continual like improvement um over the next you know couple of months, one to two years of agents being able to

do more and more tasks in a better way. I think one of the main um hindrance I think for AI agents to be able to do stuff like you mentioned being able to book the flight for you and do everything in autonomous autonomous way um is that there is still a bit of that reliability issue where let's say if the AI hallucinates maybe like 1% of the time or maybe 2% of the time which is really pretty good which means like 99% of the time it still gets the task done but then if you chain that over like multiple like different tasks and steps that AI agent needs to be able to do. He needs to search the different websites.

He needs to pull all the information. He needs to go to the booking page. He needs to key in the payment details, right? If you chain all these together, then it becomes you can see that over a series of actions, right, the the failure rate um becomes higher and higher. So, I think that has still been the problem. Um and nobody wants to use a product where you know that you're only going to get the the outcome you want like um 50% of the time or 60% of the time. um we will get there. Things are going to start to improve um faster and quicker. Um and I'm I think the other thing that also we've lacked a little bit is around the data side of things. Um for example, if you've tried out some of the newer sort of like browsers that uh or or computer use

agents that like OpenAI has kind of like you know used, you find that um it's very interesting. is able to sort of like understand what's on your screen. It's able to click buttons for you. But uh it's still pretty bad, right? It kind of like gets stuck. It's very laggy. It doesn't work. And a lot of it is because there isn't that data set out there that shows a human sort of like doing his work and clicking all these different buttons on the screen. That's an entirely new data set that has to be sort of like gathered in order to train the models to do some of these things. So the big research labs are still continuing gathering more and more of this data. And I think at some point in time when there's enough of that data all of these things will actually start

to improve uh pretty fast. >> So the agent problem is a data problem is what you're saying. >> It's a data >> it's a training data problem. >> Correct. Yeah. I think data >> context problemat context. Right. If you need to if you can feed the agent with the right type of data um then I think it's going to be able to do things that you want in a much better way. So, so do you anticipate like middle of next year to see this agent booking you a flight idea h come to life? >> I think we probably see something like that.

>> No, I think 2026 will be that year. I I kind of like think of 2026 as the year of the AI agents, right? We're going to see some of these um use cases really come to come to life at least given the pace of progress so far. >> Yeah. Beautiful. Okay, cool. um kind of completely different topic more on the on the more on the morality and economic side of these uh AI massive massive Goliath companies like OpenAI who's trying to IPO at a trillion dollar valuation Nvidia at five trillion or something or two trillion or maybe two and a half two um you know where where do we draw the line on forprofit AI companies and for the betterment of

society and how these things kind of come together. We saw this we saw this all kind of happen with the internet and you know Elon Musk buys Twitter to try to uh create a place for free speech because he thought all the left all the left wings people were taking it o over Twitter and you know all these different forms of social media now Rumble and other different kind of like interesting little pockets of media. It's also going to be happening with AI. Uh Disney has also just announced that they're going to invest a billion into OpenAI. So looks like OpenAI is just taking checks from whatever rich friends that they want to have a part of this this pie and integrate their stack into their world. You know, I could see an AI

oriented Disney World soon sometime soon. um tank you know I don't know if you consider yourself you know a a capitalist a socialist a narco capitalist a neo capitalist a communist I don't know what you are but I'm curious where do you draw the line between profit seeking for AI companies and um basically human morals morality and not trying to just farm everybody as if they are statistics on a on a spreadsheet Chat GBT is talking about uh introducing data uh that will allow them to uh actually advertise to you in the chat GBT interface. Um this is how a lot of

companies have monetized in the internet. There's a lot of push back on that. How do we where where we at? What is your mental model for the state of the for-profit corporations that exist uh which own a lot of the AI superpowers? No, I I think that's a great question and I think it's something that um you know a lot of people are also trying to figure out what's the right balance around some of these things. Um my my general viewpoint is that um free markets are good for innovation. I think we've seen that sort of happen, right?

Um and a lot of the great like um tech innovations be it like self-driving cars um have come up of like um startups and sort of like private capital and market funding a lot of that innovation um that's come up. Um AI I think everyone can kind of like uh agree that this is probably one of the most important technological developments for humanity as a species as a race. Um the thing about AI that makes it a little bit different from some of the previous tech innovations we've had so far is that AI is extremely um expensive, right? We need to build a lot of data centers which requires a huge amount of like power, compute, memory and chips in

order to continue to progress. Um and and so that money kind of like needs to come from somewhere. And the way that we going to continue to be able to fund these bigger and bigger training runs and data centers that will produce these better models is through you know both a combination of private investors like putting money into a company to fund it but they put that money it never money never comes without like strings attached right so there's always expectation of a future profit future return um for the monies out there so I I think that model will will continue. I I think there's nothing overtly wrong with that. I think what we do need is some form of like check and balances to

make sure that no one monopolizes this hugely important technology for humanity. Um the good news is that um because the entire world has recognized that this is such an important technology like everyone's eyes are on this. So, so far we haven't seen like uh a single company that seems to be that dominant player that's going to rule over the world because it has the most powerful AI that nobody else can kind of catches. We have seen like quite a number of different players have models and AI that are at almost like similar levels of like capabilities and progress and I think that will sort of like continue to sort of like um happen. So at least today I think um I'm not too

worried about the ethics of these um for-profit like companies. U at least they seem to be >> you know I I think we're in the sort of like early days of this whole buildout where you know companies are making these AI models available for free. They're not even charging consumers to use some of these things. Chat GBT's like subscription is pretty cheap relative to amount of value that you get. Yeah. So I I think um it's still in a good place for consumers, but if we get to a point where you know these companies start to charge very pricey fees for you to access this AI or they limit it to only very select group of people, I think that's the time that I would start to get very worried. So SpaceX plans to go public at a $ 1.5 trillion valuation in 2026. The Google

CEO is talking about building data centers in space. You made a really good point with regards to the way that the structures of these VC Silicon Valley led rounds create this need to kind of build out efficient technologies, create innovation, create efficient markets. In addition to that, uh investors are looking for returns. Founders are looking for exits. Um as long as we keep a baseline of democratized access, I do agree that I think that uh we're still in a good spot as as far as um kind of outlook goes. Um but talk to us about this data center uh hype like this data center rush. It's like a space race happening right now. Chimoth Palia just announced he was doing building one out

in Nevada I think uh like about a year ago or so or six months ago. Talking about building space centers or data centers in space. Is this a bubble? Dang. Is this a big freaking bubble? Are we in way over our heads right now? Yeah. So, you know, I I think everyone kind of has the eye on the big prize out there, right? Which is some form of like super intelligence. And the way that everyone believes that we're going to get to this super intelligence is by throwing more and more compute at it.

So, and that's why the data centers are getting bigger. you know this is this is probably the biggest experiment that humanity is sort of like conducting today because we don't know when this um when this sort of like scaling law will stop right is there a point where we've hit a certain limit and even if you build a better and bigger data centers and you throw more chips you throw more compute at the AI we are not going to improve it any more significantly right we hit that sort of like point in time we don't know we only will know once we actually get there and we see it and if we actually see something like that where we actually not able to scale the levels of improvements of AI alongside scaling the data and compute then I think there's a good risk that the

bubble might sort of like burst at that point in time because people realize [snorts] that actually we won't be able to you know all the additional spending on data centers may not work but until that point in time um everyone just has to play the game it's it's it's like musical chess right you just have to keep walking you have to keep building you have to keep racing to build the biggest data center and accumulate as many chips as you can so that you have a seat in this game and you're not sort of out of it especially if you're one of these like big tech companies that want to maintain it sort of like market share and dominance in this uh world. Yeah, man. That's uh that is uh an interesting picture that you paint here, Tang. Um you know, you mentioned some about uh

about some of these uh open-source kind of decentralized inference networks that you like like Bit Tensor. I'm curious like what signals do you are you looking for that indicate real traction in this market, right? like is it cost efficiency model diversity uh specialization techniques like when you're looking at this whole kind of blockchain AI sector what are you looking at right now where are you seeing actual traction and where should our you know investors in our community actually look look to uh you know do more research into and you know what should we avoid?

>> Yeah. So I think the way I would evaluate like companies who are building in the intersection between like crypto, blockchain and AI is is pretty much similar to like how you evaluate a startup like a tech startup. You look at users, you look is there any sort of like product market fit? Are people using the product? Um or if you're building an infrastructure or protocol, are people building very cool applications on that particular protocol? Um overall I would say that we are still in the pretty early phase I would say of uh crypto and AI. Um a lot of teams have been focused on building infrastructure whether you're building

an infrastructure for agentic payments you're building infrastructure to support decentralized like compute or decentralized training of AI models. um you know and once that infrastructure is in place and some of these teams are are starting to get these like um protocols launched and on mainet we're going to see hopefully we'll see people start to build on this. So I'm looking for that. I'm looking for developer activity. I'm looking for users on the platform. Um I'm looking for some of these companies to be able to build a sort of a sustainable business model and actually be able to generate revenue. U because AI is not cheap. like if you are running inference it costs quite a bit of money to run um an application that uses um or

or provides the user with a lot of queries. Um I think bit tensor is interesting >> sense >> yeah bit tensor is interesting because to me I kind of see it almost like an incubator or an accelerator. Um so like by >> buying into Bit Tensor you are sort of like um buying into say 60 to 100 different AI startups that are trying to do all different kinds of things. U most of these subnets and startups will probably not make it. They'll probably fail at some point in time. Uh but hopefully there'll be a few of these that will actually get to sort of like very sizable like revenue and business models. And we actually starting to see like some of these subnets on Bit Tensor

um like shoots are actually like you know producing quite a good amount of like revenue which is subsidized by the TA token of course. So um yeah I think that economic sustainability still needs to sort of like be thought about. Yeah. Yeah. such as the way with all all I would say 99% of these crypto networks the economics sustainability still needs to be continuously improved on and iterated on Tang Yan appreciate your time man absolutely episode absol absolutely epic AI super cycle episode today thanks for your time thank you for coming in answering some hot questions and having some fun man' love to have

you on in 2026 as we continuously explore the proliferation of this technology and the acceleration and improvement. So, thanks for your time, man. >> Yeah, no, thanks Andy for having me here. Like, um, this was fun and yeah, looking forward to chat more. 2066 is going to be a great year, I'm sure, for AI. >> And Tang, where can our audience find you, Chain of Thought? Um, how can we how can we support you? >> Yeah. Um, you know, I write a weekly newsletter. You can find it at chainofthought.xyz. And I'm pretty active on X and Twitter as well. So you can find me at Tengen AI, I believe.

>> Awesome, Ten Yen. Thank you, man. Speak to you soon. [music]