DeFi in the Macro Landscape: Bill Barhydt, Mounir Benchemled, Christine Moy, Dan Tapiero

Transcript

i thought we could start off from a very high level here kind of like i was just saying we've talked a lot about how there's a lot going on outside of our little crypto bubble right in the macro world we hear a lot about inflation we hear a lot about central banking we hear a lot about interest rates currency debasement etc and obviously there's been a lot of pain recently in crypto but also in broader markets as well so maybe we could just start off from a really high level and dan i could i could pick on you here to kick us off uh what's your kind of high level macro framework what do you think is going on out there in the world right now well that's a pretty broad uh question yeah i set you up yeah all right macro framework um well obviously uh right now with the fed

being very focused on um i mean i guess it's inflation but i think really they've entered a phase now where there's going to be pretty serious demand destruction and so they're using a very blunt instrument which is the interest rate tool and they're not even really using it they've been jaw boning i think the market to a place that is unrealistic and so if you look at the first quarter fed funds futures right now today it's priced in at three percent and so we have a one percent funds rate and if we're going to three by q1 is priced by the market that means they're going to raise another 200 basis points so if they do that

i mean i think the markets will be down massively i do not think that's going to happen so i think what will happen is that they'll move they'll shift their focus and their bias after three months of two to three months of obviously negative economic and inflation data so i think we've peaked at inflation already i think there are early signs that the growth numbers are going to be significantly lower in the coming six months and you can see it in the bond market the bond market has started to uh i mean at least trying to bottom around here which i think it is i mean i don't own any bonds i haven't for many years this is the first time

in at least five or six years where i think if you're nervous about your equity exposure you can uh own some bonds and some gold as uh as your hedge so in an environment where the interest rates have sort of the the market interest rates have stopped going up i think that will also be broadly supportive for crypto generally so i that's how i would frame it so slower growth being positive and i think that's coming and you're already seeing it in china and europe so is that that's great that good but for the for those in the audience as well like can you explain why what's the connection between higher interest rates and why certain sectors of the economy tend to get really whacked right like crypto is down

you know 50 or 60 from the highs you're seeing some like growthy sort of tech stocks why when interest rates go up why do we see those particular sectors just getting better than answer the two i mean that's just for whoever flow of liquidity that's all it is and you know when the fed has a posture uh that's aggressive let's just say and they jawbone or push the market through their comments and speeches to pricing a certain outcome um you know liquidity gets removed and you also see that in the dollar when the dollar is strong that means liquidity in the u.s is tighter than it is in other places and so you've had the yen at 130 and the euro 104.

um you know this is a strongest a dollar has been in a very long time um i think that's starting to reverse a little bit because the market's sensing um that the asset markets are at a place where things are beginning to break and i think i put something out on twitter yesterday the the empire manufacturing index and again listen i don't do macro at all now honestly i'm 100 in the crypto world but so you know i don't follow the data as closely as i used to but this empire manufacturing index this is for may it's always the first data point for may it dropped 32 points uh and is now below zero in one month

okay we've we've only we've we've only seen that kind of drop in this index uh in the covid march 20 covet it's much worse than oh eight and this tends to be a leading indicator and i think you'll start to see more of these leading indicators and then when it's super duper obvious the fed will say all right you know maybe we we don't need funds at three percent and then there'll be a view in the markets that liquidity won't be as tight in the future so you got to let somebody else talk now all right all right zooming out even maybe even leave even a little further than what you're talking about here dan uh bill you did a great episode uh on jason's podcast empire talking about

kind of long term here what's really happening short-term debt cycle long-term debt cycle and what that means for the economy we've got a really great framework that i think helps even put this recent sell-off into context would you mind just going into that giving the audience uh an understanding yeah sure look i mean uh post brett woods um the victors went to spoils that was us the dollar became the reserve currency in 71 everything changed uh we all know why and now i think we're in a very late stage debt cycle vis-a-vis you know that post-world war ii era uh i think we're in for a lot of pain but i still think in the short term uh the bond rates will come back down so

this kind of macro thesis that um the the bond market is just going to fall off a cliff i don't i don't buy it in the very short term i think the bigger macro problem that we have right now is is that when you after post-canceling russia right you know february 26 or whatever day that day was um will be the day of infamy because that was the day that the mark you know certain countries realized uh you know that they could basically be completely shut off from the u.s banking system so working backwards from that i think it's going to create a long-term structural problem where the cost of u.s debt is going to have to either have to go up which means we're going to have to absorb significant pain at some point

right or you know the uh the federal reserve continues to become the buyer of first resort which is what they've been for the last you know i don't know what how many years basically since the end of the the decade right petro dollar right exactly and that's gonna break eventually because effectively from everybody else's perspective our debt will become worthless and the only people that will buy it will be the banks because they're forced to buy it um and so you know i think the question becomes okay what happens for the next two years clear i think we're in recession already uh and the fed is a trailing indicator uh pretty much on everything now because they just i'm sorry but they basically just lie because it's easier to

basically keep people at bay and as opposed to like you know like like trump would say we don't want to panic well that's ridiculous but i'm pretty sure we're in recession now and i think they're going to basically decide hey okay the bond markets did for us and oil markets did for us but we wouldn't do for ourselves okay so okay great uh fastest credit tightening and history to my knowledge and they're gonna have no choice but to basically say oh we gotta pause and watch what's happening here and i think when that happens it could be really like game on at that point because then everybody you know the the institutional investors are gonna realize okay it's it's back to don't fight the fed again um whether that happens in july or

august or september i don't really know i don't really care but but i don't see how it doesn't happen and the only question is how much pain are they willing to inflict before they do that and then the longer term question becomes like i said how do we how do we deal with the fact that these debt cycles and you know dalio is the master at explaining this and his new book is fantastic if you really especially if you're into the data how do you get out of these long-term debt cycles without basically what has happened for hundreds of years unfortunately which is war and and we can see this playing out again right i mean if you you know finland basically is now saying like it it is no longer safe for us to not be in nato and hours later russia's expelling

finnish you know uh diplomats this is scary stuff right and so the other question becomes is it all playing out again the way it's played out for a few hundred years or does this global movement towards decentralization which has been happening in parallel in my opinion for the last 40 years culminate in a way out of this mess because we can basically eliminate uh centralized trust which has been the backbone of the problem for hundreds of years because everybody keeps saying the same thing over and over again trust us we're going to make sound money and at the beginning it looks great and eventually they say you know it's still sound money but the basis for the sound money is just gonna be your

trust and that is that human frailty injected into the system has been the problem for literally 500 years does crypto and the crypto model d5 which we're supposed to talk about here and you know bitcoin as potentially pristine collateral represent a way out of that and and that's what's really exciting about this space to me help me make that concrete let's connect these because there's this enormous problem right that's building up in the system debt driven system we have too much debt uh the economy has essentially leveraged the debt which has led to low interest rates asset bubbles all this kind of wacky stuff that we're seeing and we talk about this idea of especially in crypto sometimes i think we're guilty of saying decentralization will solve all of this right that's our way out that's our silver bullet our

problem help me connect these two ideas of decentralization and how that's going to how that could potentially be a solution to everything that we're seeing in the macro landscape sure i'll go first i'm sure over here everybody has an opinion i think look to me silver bullet means potentially solution but i don't think there's any way out of the pain right i mean you look at japan as a guide and basically they went through what 30 years of of of deflation to basically deal they took the pain but that's a different culture we have a very difficult uh time getting our arms around short-term pain in the united states right uh and and so i think that there's no way to avoid the pain that's coming it's simply a

question of what happens at the end of of that pain and i think we end up with a more fragmented world i don't think you end up with a model which is just um you know a single global reserve currency anymore i think you end up with uh yuan you end up with a dollar and you probably end up with crypto and and gold is like a transitionary asset uh and and so that could be 10 10 years it could be 15 years i don't know um but um i think a lot of countries and and and i don't know how many people here have been paying attention but 45 countries met this week and with a primary topic being bitcoin adoption as a reserve asset now the gdp

of these 45 countries and the aggregate is very low but the fact that they're even having this discussion is astounding right i mean it's incredible it was a premise of a talk i gave 11 years ago when bitcoin was trading at two dollars and everybody left and now 45 countries are meeting to have that discussion so i i still think you know it's it's it's seven to ten years out from a macro perspective at least but you know we have a way out yeah i'm gonna um monir and christine start calling on you for some of these as well uh you know one i'm sorry sorry actually just to add to bill's point i think the like at least from my perspective the

key takeaway is market volatility ahead in the next few months given all of the uncertainty and the macroeconomic headwinds uh you know i think uh as a builder uh as a investor company like you know just if you're if you're not already fiscally responsible which i'm sure you are like it's time to batten down the hatches and just be ready for anything um you know we hope that it's you know kind of we will you know find our ways out out of the situation but you know there is uh certainly risk of recession or as bill said could already be in one so i think that would just be like the key takeaway from my perspective great reminder yeah absolutely um you know when it comes to

decentralization like a lot of people like in bill you're just saying about bitcoin the need for sound money right something that people can actually store their value and not have it be worried about uh getting debased one other interesting thing that you said a date that you pulled out was when the united states seized you know some 400 billion worth of assets from russia's central bank right as being a very important thing and i think sound money is one part of what we need but also we need this decentralized financial infrastructure right as well to accompany that sound money or maybe i could call on you here as the the founder of decentralized exchange you know when you think about why defy is important why we need this you know kind of way to transfer value that's not beholden to any one country bank etc like what's your kind

of framework for why why we need that well i think the reason why we have crypt in the first place is to create a separation between um value and and any kind of centralized control so decentralized exchanges is a continuation of that philosophy is uh it's not just about uh the decentralization of the asset itself but the usage and the exchange of that value should be neutral should not be under the control of any centralized party so that's why decentralized exchanges took off in the last two three years so i think that's that's the main approach is the this separation of value value exchange uh on top of value value value uh holding yeah yeah

absolutely um christine i could uh poke you here just as a representative having previously worked at large bank jp morgan now working at uh starting at apollo congratulations on the new role um i mean how do how do banks kind of look at defects there's this funny contradiction we talked yesterday about d5 having this huge potential for disrupting banks but also when you explain defy to people in the banking system they're kind of like oh yeah i understand this so like how you know how do people kind of inside the banking system that we're institutional part of the market how are they looking at d5 decentralized financial infrastructure yeah uh you know i think from my time uh you know running blockchain crypto at jpmorgan in the past half decade and seeing how the space has evolved

uh you know essentially i you know when d5 defy summer and you know now the next generations of d5 that were watching emerged uh you know i was basically like running around like waving my arms around like this is this is crazy like everybody needs to pay attention to this right now because this is incredibly more disruptive than we might think it could be um and the reason why is because um you know i think what's really interesting is that with defy like essentially what you're able to do is do like all of the functions that a large financial institution may be able to do like fx market making price discovery

uh you know margin management and collateral management uh you know secured loans etc in what's you know prominently been emerging but all with a close to zero if not zero cost basis with like a few lines of code right something and and these are functions having been inside large financial institutions uh these are functions that take hundreds if not thousands of people to support multiple systems and it's definitely not you know it's it's it would be disruptive in that in that way uh if for example you know everybody's talked about like the d5 mullet like if for example like an enterprising fintech or neobank would you know basically be like

a regulated entity that would be the face of like using like these this d5 protocol back end as an example right because essentially these entities would be competing at a very lower much lower cost basis than um you know some of the established uh institutions that have already uh their technology and operations built out and then you know furthermore and and bitcoin and crypto as an asset class is definitely disruptive but you know i would say that if you're a trader at a bank like you kind of can navigate the market infrastructure that has emerged around bitcoin right it looks actually quite similar to fx or commodities in that you know there's the futures markets there's etf there's spot there's you know options

and so you know i think that uh from a from a large financial legacy financial institution perspective there's probably like a less clear path on how to navigate what to do with d5 how to play in d5 what is our role if this uh you know if and when this emerges to be a thing versus you know like being able to interact in crypto markets as at large that are more mature um so yeah i mean and and so and and the thing is it's moving so fast uh and the reason why obviously i don't need to tell you guys the reason why it's moving so fast you guys are moving really fast um but you know the ideas are like basically there are three reasons at least from my trad five

perspective uh first it's all open source code uh second it's multi-threaded innovation so hundreds of teams uh you know around the world working on you know or able to draw from each other's code or be able to work on each other's projects and kind of compound uh you know each of the d5 lego blocks on top of each other and then third tested with real money now let's think about how financial innovation used to happen before all of this uh used to be close source right like uh at a bank like would definitely have like a secret lab where we're like developing our proprietary technology and like no you cannot see it and it's highly protected and top secret and definitely can't have any

competitors know about it right so it was close source then it's like single threaded right because if you don't tell anyone what you're working on then like people can't contribute ideas to it you can't like innovate like it's just basically like you know waterfall type uh thinking right it's like oh this one team thinks this and so now we're gonna just like build upon you know what we're already thinking as opposed to collecting the ideas from the world and then the third thing is you know if it's not fully baked and you haven't gotten like 100 approvals from like risk compliance legal cyber um you know 10 times over then you're definitely not going to put any real money in it and you're not going to have any clients using it uh whereas you know i think you know it's almost like a feature and

not a bug that some of these uh you know protocols are being tested with real money it it hurts and we hope that everyone is involved in the market knows what the risks are that something that could be in the billions can go to zero in days hopefully if that's not clear it's clear now but that is actually what contributes to the exponential speed of innovation that we're seeing um and so you know it's quite difficult for a large regulated institution to even be able to participate in that and yet despite how difficult it is there's a there's you can tell there's desire right from these institutions to participate and defy unlock some of that

value even if regulatory uh kind of constraints don't make it possible today guys i want uh there's a very clear line i feel like in between the macro driver for bitcoin uh and kind of like money printing right it was the money printer gobura meme i was a bit of a joke but honestly in people's minds it forged this very simple association when the money printer goes bur and the fed is printing and adding liquidity then that's good for bitcoin i feel like in d5 we still need to flesh out what is that narrative right so when you guys kind of look at the space what are some of the things that kind of stand out to you right macro drivers maybe it's yield maybe it's when assets get seized on a on a basis globally like what are some of those like signpost things in your

mind um that say oh that that should lead to more adoption for for dpy we're one of the largest users of defy as a centralized institution and i can give you in the trench's perspective that's both good and bad right you know we also do we have our collateralized lending business to institutions retail and miners is much bigger than our d5 positions but we spend an outsized amount of time i mean order magnitude more time on risk relative to the d5 positions than we do on the lending positions not that we i mean our risk management um models for the lending is are very clear there's it's it's there's not a lot of room for interpretation in most of those discussions because as it relates to d

phi it's 24 7. no borders um you know sometimes we're coming out of positions at 2am on a saturday night and that's the way it goes and we have clients who use abra earn to earn yield which is you know an amalgamation of all these things that we're doing that you know that we're very transparent about and they'll say oh you know i have a lot of money in earned but i'm thinking about putting some money in tara luna and this happened a lot in q1 you know what is your take on this and i would i would never give an opinion to them directly on tara luna because it's not my job but i would say here's what we do to assess risk right and all of my money is in this

product all my liquid cash is in this product here's what we do to assess risk are you in a position to do this for yourself right and if and if you're testing it with you know one percent or a half a percent of your assets okay but if you're going to use this as a bank account right which is what i heard over and over again you know and i'm saying to myself okay no this is a bank account has risk management processes it should be hard to do the things you're talking about as a bank and at least for us right as a you know regulated lender and you know paying through interest through a trust right the risk management processes need to be

commensurate with the actions that we're taking you know and and the average consumer even the average techie in this room who's writing the contracts can't do that you know it's funny there's an irony i remember like a year ago uh all these yields in crypto are very high and everyone would always ask where all these high yields coming from and all the kind of the kind of more trade five folks in space would say these these yields aren't sustainable and all these crypto people would say all these boomers they don't think the yields are sustainable a year later it turns out many of the yields weren't sustainable honestly um well that's not exactly true i mean the very high yield stuff but i mean anyone who's rational would say look if i have a 15 or 20 yield there's some risk there so

and but the 7 8 on stable coins that you can get pretty much anywhere or six to eight on bitcoin stable coins it's been pretty stable i would say so and i think it's largely really straightforward there's a capital shortage in the space and borrowing for someone in the space to borrow at seven or eight percent given the returns that are available in the space it's very reasonable and that's the cost of funding innovation and so i mean i see it in in our world and you know there there really isn't enough capital to fund all the growth that's coming so that's why the yields are higher and

i think the yields stay high for a long time and the banks won't service those other banks yeah and they don't have the skill set to you know even understand why i mean this is a very simple explanation but right i don't know i disagree definitely understand this like definitely have the skill set to understand understand why but just not well positioned to action on it or participate in it or being explicitly told you can't lend to a minor even with 120 collateral right because we don't recognize bitcoin and by the way those of you who've ever taken tried to take out a mortgage and are holding a lot of crypto it's no different right what's happening at the institutional lending level is exactly what's happening to you if you're holding crypto and you're

trying to get a mortgage but yeah hold on also i would say if they had the skill set like you they would leave [Laughter] hold on a second hold on hold on hold on a second hold on a second i'm still staying in shred fight y'all though i'm staying in traffic someone's got it someone's got to fight the good fight from the tragedy really i mean morgan and apollo are very different entities one is a risk-taking you know entity that seeks you know high returns on their capital jp morgan is just a large bank yeah anyway so on my move from apollo i'm super excited to join so those of you

who are not familiar with apollo apollo global management is a half a trillion dollar alternatives asset manager that uh basically has a variety of different businesses private equity credit credit markets uh recently has also built retirement services insurance uh low cost of balance sheet and very entrepreneurial fast-moving culture uh and um yeah so basically i'm joining as a partner to run their digital asset strategy uh hoping to build our practice alongside the different businesses that i mentioned um you know really excited because you know we'll have the opportunity to invest in this ecosystem but furthermore uh you know i'm like

enterprise blockchain queen over here uh still trying to realize my dreams of you building real world use cases in the crypto ecosystem um so you know it's kind of like a take two with like a different approach and a different platform uh and um and you know different resources to essentially be able to figure out what are the best projects protocols uh and teams that can enable us tech enable us uh to be asset manager of the future so holler at me if you got something good but you know i think the key thing is uh you know real world use cases um you know we play in a variety of space spaces you know uh if you think of blockchain as a ledger of assets all we

got are assets uh and so you know super excited to you know see where this next chapter goes ben smiling like thanks for teaming me up you're you're in crypto now that's what i heard i've been encrypted i mean you're deep now yeah you're gonna start getting a lot of them oh but yeah i'm with it okay yeah i got it i got it uh guys how important are those higher yields into drawing capital into the space right like at a high i mean because on the one hand right six or seven percent doesn't take a genius is better than you know the whatever uh you know two or three percent or whatever it is in tradify but we haven't really seen that kind of max as a mass exodus of capital moving into to see

so i would say from our perspective like if you were to ask our private client services sales team the yields that we're able to generate uh to dance point definitely get us in the discussion the risk management keeps them and when we're getting a net inflow in the last week or so when everybody else is getting in at outflow they're saying okay what are you doing differently here why are there no losses and well it's what we've been telling you all along there's adults in the room that are actually analyzing risk reading smart contract code saying if you're paying 20 and doing no lending right you're basically printing money in order to pay that yield and and so you know

that's what people want to understand at scale so yeah there's a lot of places where you can go to earn eight percent on on dollar stables right now and and you know that's great uh but the question is is if you're going to use this in a banking model what are the risk management processes and how are you yes how are you using defy and i'm a i believe that the biggest banks in the world are going to be d5 based in 15 years i mean biggest market cap banks in the world and i'm actually almost 100 i wouldn't say 100 but as more positive with that sentiment as i can be um without leaving room for like you know some crazy next-gen thing that i haven't thought of yet right um and

but still right how are you analyzing this stuff how are you making decisions on where to allocate yeah and so just to build on to what you're saying uh you know bank or you know your company or not there definitely needs to be if we want to get to the next generation of users there definitely needs to be this layer of like risk management or education uh abstracting the complexity uh and you know probably like curation and security like are probably like the most important things right i mean right now we're kind of in this cambrian explosion of you know new stuff is getting built so you know it's not been battle tested but you know if we're talking like a few years out there are going to be protocols already starting

to be like battle tested and all survived and will be like okay and then obviously you know hopefully more eyes and more money will mean more auditing and more testing and risk management and then at that point maybe the role of a bank or a financial institution is to curate what are these back-end protocols and to you know clearly outline the risks related to the returns from this menu of back-end protocols or d5 protocols that they've curated and then kind of offer it as like in some sort of interface to clients which sounds like what you guys are doing we agree with that right so um perhaps and then and we go one step further we would give you real-time access

to core tenants of of web 3 and decentralization we won't do anything that doesn't give you real-time access to be able to move your funds out of the banking system right and if you want to base if you know what a ledger is and a lot of our clients heard of it but they don't know how to use it they they can do that right whether it's you know what we're doing now with with yield or our trading and in the future uh with some of the stuff we're going to be announcing in nfts and whatnot but they can take 100 control anytime they want and to me that's the bank of the future not necessarily that 100 of people are going to be using a ledger or or you know whatever competitive device or meta mask but that they can whenever they want to

right so that's how we look at it yeah i think that's the other important part of this how many of you guys caught uh josh rosenthal's speech earlier or on the first day i it was a really powerful analogy that he used about like looking back in time imagining yourself living in medieval ages how you thought you were entirely free but in reality you owned really nothing and i think everyone who's tried to explain crypto to people who aren't in the space have this like frustration of saying you those things that you think are your assets are actually not your assets and i mean look at two of the announcements that just uh happened at permissionless this week i mean robin hood rolled out non-custodial um services right uh non-custodial uh trading uh to their customer base and coinbase did the same so munir you know as the operator of a

decentralized exchange maybe we can touch on this last kind of macro idea about the importance of people owning their own assets right as opposed to a centralized exchange where you go and then you get an iou you know people trade on i mean talk to us a little bit about the importance of that and how you view it yeah our user base are mostly d5 natives so they worry they care a lot about having control and optionality and it makes a lot of difference for them to be able to make a transaction and immediately get access to the other party that they are that they were trading um and and instead of a finance or a centralized exchange where the only use case they go there is for fiat on rampant off-ramp so that's only the only

use case so this is for the define natives but to to build on top of what you guys were saying is this optionality that's a user of a centralized service where they can have at any point of time access to their funds without any any guarantee and also all the auditability of that code that is open source and can be seen by anyone so that parts i think makes a lot of difference and makes a confidence on the market and can bring a new adoption that's we may not have seen in centralized services absolutely so maybe to conclude here you know we kind of started off with where we are in the current macro cycle um i'd love to get your thoughts on where we

kind of go from here crypto specific so in the past there's been a tremendous amount of importance around the bitcoin happening right which is a reduction in the supply schedule and that kind of tends to anchor these four-year very predictable kind of boom bust cycles there's a panel specifically on this later this afternoon the verge of the merge but there's an enormous thing happening with ethereum right which is the merge and there's a drastic reduction in supply that's moving to proof of stake and all these other things i'm curious do you see everything in crypto right now as current bear market purely being a function of what's going on in the macro environment with interest rates or are there internal catalysts that are happening crypto specifically that could actually bring us out of uh the current bear

oh you're smiling yeah so that's a wow that's a great question so i would say a few things happening right i think the the bitcoin peaked sooner than it otherwise would have if it wasn't for the china ban i wouldn't be surprised if it had peaked in the 80s or 90s i mean obviously nobody knows but that's i think reasonable assumption i think um there's a few things converging at once right with ethereum scalability post merged and i'm potentially looking at charting out in the future um but the thing i'm really excited about that i think could be a catalyst is um all the talk now about mpc and has how to basically take mpc technology and make potentially applications that really hide key management complexity to

real-world use cases both consumer and institutional and we're spending a lot of resources on this at amber and i'm really bullish on it and i i think coinbase talked about it earlier this week and i i think mike talked about it a few minutes ago and so clearly there's a ground swell about people are starting to get it that hey wait a minute there's actually a way here where you don't have to be a phd in metamask to actually use nfts um and or or more importantly you know ask a 15 year old what an mp3 is they don't know what mp3 is right and and so they just know music streaming and i think that's where this is headed now and there's some new technologies coming out that i think are going to bridge the divide where everybody could be using power swap and not have to know it and

that's huge yeah i think also crypto loves new narratives so during the previous beer market defy was the new enzyme that maybe started or maybe not the new bull markets with compound launching uh farming that's created a whole vague of new ideas and also people discovered things that for the defy community were obvious and followed by nft so i think new narratives maybe will come in in terms of bringing the masses and bringing the next billions of users into crypto that may create this new bullface that may come in two years or few months i i would just say um

vis-a-vis defy you know obviously this luna blow up has i think pushed off adoption certainly of you know people's comfort with yield generally on stable coins of course people outside the space they assume you know all stable coins are the same right so that's probably pushed off that massive institutional inflow you know that exodus from the banking system you're talking about but i mean look nfts were just started you know 18 months ago i think that's probably an area that will boom in this sort of next cycle i mean some of the higher quality ones haven't really even dropped in price yet so um yeah i think that's probably

an important important driver in the next cycle but to be honest i think it's really hard to know space is growing so quickly and so much innovation so i bet i mean it could be something we're not even aware of yet it's like every day in crypto yeah exactly yeah yeah and from my perspective as i mentioned uh definitely strapping in for volatility ahead in the broader macro markets like people that just don't follow crypto markets just follow regular markets think that the next few months could be a little bit challenging uh you know and then we have our own idiosyncrasies like you know things uh happen right things happen around the corner that we don't expect but that's

cool that's part of what we're here to do and part of like you know what we're trying to build and trying to build quickly um and so you know i would say definitely like just need to focus on staying in your lane if you're building something build it you know try to have like a try to be uh you know just try to survive and move forward and make progress if you have like exposure to the broader markets from your token then probably time to work on what your treasury management looks like and like you know like this is what like companies do like if they have like multi-currency fx exposure then they have to hedge some exposure or they have to manage it actively uh maybe not something that you

know teams have started thinking about yet because you're also young and usually uh you know that's something that mature companies get into but something that you're gonna have to learn faster and um you know probably like just try to navigate the uncertainty ahead and but you know the upside is in you know the last downturn of crypto feel like an old dinosaur like for like all like well you know back in the day uh you know in the last down cycle like the companies that kept building heads down really focused really driven eye on the prize i i have the tiger you know shipped product became the biggest companies of this cycle uh and and it shook out a lot of the noise it shook out a lot of the

opportunists and you know the people that just came for the party and you know so there's a silver lining um to market uncertainty you could also have something like you know lightning on bitcoin take off i mean the growth rate there has been huge there are a lot of naysayers but you know when you see as you mentioned before was mentioned before 44 countries going to el salvador and you know i do think that the the the use case isn't really discussed here in the emerging world i mean i keep reminding people this is not an american bet right the dollar is pretty much fine um and there are many countries out there that don't have proper monetary fiscal policy or currency policy so

there's an intuitive understanding there about the value of bitcoin and um you know maybe it's something like lightning i mean again we have to see what the uptake is but yeah the other one that i would flag there too i mean it's funny on the same day that uh you're the same couple of days that the lunatare ecosystem was kind of imploding instagram announced that they were rolling out adoption for nfts uh so i mean i mean when people talk about when's the next billion users going to come to crypto we know where the current billing users is it's in web 2. so how does that migration kind of make its way through i think it's an interesting thing and you've had a lot of focus here on gaming right and they're two billion plus gamers and so there's

that whole view that you know maybe that's the next you know whoosh of adoption so who knows it could be any one of them yeah all right guys that's unfortunately all the time that we have guys give him a big round of applause