How to Invest in the Intents Economy with Haseeb Qureshi, Avichal Garg, & Matt Kummel

Transcript

I basically agree with your description that it seems demonstrabably most the value sits either at the bottom or at the top, but you don't really want to be sitting in a middle the payment methodologies are are extremely fragmented, right? If you've tried to move money a legacy system around, so everything just gets hyper hyperfragmented. >> The sweaty moment when you're waiting I just remember moving something from ETH to arbitrage and then trying to move it back and it's a 7-day wait and you got to put a reminder in your calendar. >> Isn't there going to be a lot of people coming for this market? You know, how do you think about that? uh playing out as as we scale from 10 billion to 100 billion to you know trillions. H >> how do you think we see this market structure evolve you know as we continue

to see intense protocols scale more and more with more volume? Welcome back to the rollup. I'm Robbie. >> I'm Andy. Rob and I met at the University of Florida in 2017 where we first found out about digital assets. >> We learned a lot along the way and we're bringing you face to face with the leaders of our industry. >> Sit back, relax, and enjoy today's episode. >> All right, gentlemen. investing in intense hash A Matt guys great to be back here Matt I think it's your first time on the show would love to just get a quick intro about who you are what you do and then we'll get right into it >> thanks Andy uh I'm Matt Kmel I'm the chief commercial officer for the near foundation um I joined over the summer in July I have been in crypto since 2021 I spent a long time at DCG uh prior to

that long career in consulting and traditional finance hedge funds banks and and that world so uh this is the place that I'm most excited to be. The whole concept of intense is the reason I joined uh I joined near. So I'm really excited to be talking about this today. >> Beautiful. Jent we're going to talk about investing in the intent stack where where we see value occurring generally how we're thinking about it. We we framed this to a set of application builders earlier on the show and just kind of speaking about how it seems like the industry has conceded that intents are indeed the endgame for interoperability for payments for crosschain swaps and just generally the best form of bridging that we've seen since the inception of basically the

multi-chain world. We kind of had a good debate about it going back and forth about there's a lot of nuance to to that take. You guys are obviously very very familiar with Near Intense and just generally the crosschain landscape. I'd like to get each of your takes on why or what you believe the the current status quo for interoperability and for crosschain uh value acrruel. Right. I think a lot of these applications in the in the interop stack have struggled from kind of being in in the middle kind of you've got base layer the L1's acrewing a lot of value and you've got the applications that own users acrewing a lot of order flow as well. in the middle has been kind of a sticky spot for a lot of teams. How do we think about the current state of the status quo of

investing in this kind of in the middle stack with regards to intents and I'm sure we'll go from there. Hib why don't you kick it off? >> Yeah, so we're longtime investors in Near. Um we actually invested back in 2019 it must have been in the seed round and near obviously evolved quite a bit since then. Well, you you did a you did your metastable back at Metastable. Correct. >> 18. >> Was it 18? Yeah, it must have been 18. That's right. That's right. >> We we did it at 18, too. >> Yeah. Yeah. Yeah. So, I think we were in that same we did that round with you and >> that's right. And uh at that time, I mean, near was totally different. And so, intense was something that really evolved out of the explor the product exploration of Near in that time. And

it's one of these happy accidents. This often happens in startups is that you start you know trying to do something and you end up finding this auxiliary thing that actually ends up becoming the the real thing that that consumers want and and pull out of you. So from from our perspective investing in intense um like our original investment in near was not predicated on intense but it's now become increasingly clear that as you mentioned a lot of the middleware you know if you're investing particularly in like a solver or uh you know these are these are not where the value is primarily acrewing if you think about the Zcash rise over the last few months so much of that the rise of Zcash has been captured one obviously by Zcash itself second by Zashi which is the application that actually routes

or not that sources the demand from users. Um and then third near itself which facilitates all the solvers coming together and actually settling transactions through their MPC network. But although there are other startups and other companies that sit in between somewhere along that stack, I basically agree with your description that it seems demonstrabably most the value sits either at the bottom or at the top, but you don't really want to be sitting in the middle. >> Is Yeah. Yeah. I think I think about it a little bit differently. I think there's like four players when you're talking about an intent. Um you have the app and the or the wallet that owns the owns the end user that owns that that that relationship with the consumer. Um you have the intent protocol that is

coordinating and solving and and finding uh the path between the the user's desire and uh and the liquidity. You have the solvers, you know, and then you have the the other L1s and protocols that are there. And so um having looked at this hive like the app absolutely like deserves to get a lot of the a lot of the value acrruel here because they own the relationship with the user. There's a lot going to the solvers as well. If you can if you can run an efficient solver we have 40 plus solvers running on intents. Um there is a lot of value that gets captured at at that level. Um there's a little bit in that middle piece in the intent protocol. We're trying to to figure that out right now.

Um we have done $10 billion 11 billion of of trade routing through there and um and we're working with our partners to make sure that that we get the right uh part of that. And then yeah, the protocol the L1 at the at the at the very bottom is is actually not getting as much as as you as you might expect. They're kind of getting gas fees and that's about it. >> Yeah. Sorry. So when I was saying the solver the solver network in what I was referring to as the bottom layer which is actually like managing and routing all of this that would be near in this case not the chain that you're moving from or moving to those chains obviously are getting almost nothing. Yeah.

>> Well, I think there's there's a market structure thing here too, which is in a lot of markets this is the case where you sort of like I I can't remember if I published this or if there's an internal thing, but I've talked about this on a bunch of podcasts where you kind of have this like x-axis which is users on one end and and like heavy capex infrastructure investment on the other end and you put a y-axis on it for who captures the value and you do get like this U curve in many markets. So you know uh Nvidia captures all the value, AWS which has a hard capex problem captures all the value and Facebook will capture a bunch of value on the front end or claude you know will capture a bunch of value. Cloud code will capture a bunch of value and if you're like in

the middle and you're systems integrator you're you're in a tough spot. I think there is there are two things though that are sort of asterisks on this. One is um even if that's the relative shape the the total size of the market is a consideration here. Right. So if you're talking about a really tiny market, yeah, like the middle is not going to capture that much. If you're talking about something that's like trillions of dollars, actually the middle could still be like a $50 billion company, right? So, so one thing to think about is like what is the scale of what you're talking about? So even relatively speaking, okay, great. Bitcoin is going to be worth 50 trillion, but actually that might mean that something that that we would sort of call middleware might still be worth hundreds of billions of dollars, right? So there's a scale

question. The second thing I think to note is that that's not universally the case. this the sort of U-shaped curve. Um, and I think it's a little bit of a function of how fragmented are either ends. So, one example here would be Stripe, which is Stripe captures a crap ton of value. And it's because it's so fragmented on both sides, right? There's millions and millions of apps app developers and people that need to do this sort of processing. And on the other side of it, if you're trying to do this at global scale and you're trying to do this with real users, the the payment methodologies are are extremely fragmented, right? if you've tried to move money in in a legacy system around so everything just gets hyper hyper fragmented or like um Twilio used to be a good example of this the market structure has evolved over the last 15

years but um you know so many so many app developers on one side and so many so many places to route the messages and like the nuance and complexity of doing that is to do it reliably is quite hard and I think you can make an argument that intents look a little bit more like a stripe or a Twilio than like traditional middleware which is if you believe they're going to be millions and millions of developers trying to route stuff through networks and actually there's going to be you know thousands and thousands of chains between L2s and L1's and specialized chains and permission chains yada yada you actually have a fragmented market on both sides which actually suggest that maybe intense could capture a lot of value in the middle and and near as the routing mechanism looks looks a little bit more like a stripe or a twolio um than it

does like a traditional middleware company. >> You guys are nodding so I assume nobody disagrees with me. I mean, I think I I I just feel right now it seems like based on what Matt said, like there's just been like like the qu like the issue now is okay, how do you meaningfully monetize this? Like like there's a moat from the perspective of like Near has some of the best chain routing infrastructure, right? You can go from Zcash to Bitcoin to Salana to Ethereum to all a ton of L2s, other non EVM chains. Um but but but but as as a user like am I gonna is my interaction with this application going to change if there's a a uh additional fee added and like how that kind of uh plays out from

the perspective of like is there a moat that is monetizably defensible or is it just because right now it's a really great spot to go and do this crosschain action but if there's if there's you know somebody else who has a very similar application with smaller fees you know it is there going to be a discrepancy in terms of like where users want to go. I guess like what I'm trying to ask here is like is it just the best product on the market right now for people to use to go from Zcash and you know kind of like these silos or is it a really really good product that can also then start to like charge and actually create a sustainable kind of like revenue source from this?

This I mean the story on these kinds of things is always that you get to scale and you make it up on scale. Um, it's very seldom the case for I mean, unless you're Coinbase that you're going to have super high margins and that's how you're going to end up building a big business. Um, if you look at the big exchanges in the world, you look at the Binancees, the OKXs, the BBITS, they have very low fees. They they compete on fees. There there's there's constant fee competition. Uh, but that doesn't mean that these are small businesses. Actually, they're tremendous businesses, extremely profitable. So, I think the story for Neo Intense is no different than that. is the demand for assets moving crosschain and basically the kind of you know the problem with dexes historically has been that okay you can do spot dexes spot dexes are great but

they're constrained in the number of assets they can list if you go on Binance the kind of assets you can trade is basically everything in crypto but if you are on you know uh if you're in DeFi and you're trading on unis swap you can only trade assets that are tokenized on Ethereum so you can trade WBTC you can trade ETH obviously rep soul some there's some of that the further down you get on the list once it's no longer Ethereum based you're kind of screwed or the liquidity is so thin and it's so annoying to have to wrap and unwrap and figure out exactly you know what you own and how to get it out that what really people want is the centralized exchange experience which is just I'm actually trading the underlying and that's I think part of the reason

why Near Intense has taken off is it's so simple it's you're actually trading the underlying and that's what people want in a spot experience Havachi is fast and private per trading secured by ZK with Celestia underneath. Go to habachi.xyz to start trading today. Not your keys, not your coins. From the team that pioneered cold storage, Treasure has just released its new wallet. Guys, if you are still using hot wallets in 2025, 2026, you are missing the entire point. Secure your coins. Get a treasure at treasure.io. Yet is built for big moments, the most fun you'll ever have with your crypto. Go to yeet.com to yeet into your next game. And this this uh this holds true to the neo finance

thesis that we have here, which is sort of this maturation of a lot of the old crypto infrastructure that never really found product market fit. And then on the other side, you know, the legacy finance that we think is going to be forced to innovate, whether through regulation or or the disruptors that are out there. Ultimately, people want the centralized exchange experience. But thinking about value across the stack, you know, we we do have some data behind this. Uh Matt, like you mentioned, 10 to 11 billion dollars of volume flowing through Near Intents has generated $18 million in fees. Uh this over 500,000 unique users in the last 30 days, uh 100,000 users in the last seven days, over 16 million total swaps. So I I'm curious about how these how the market

structure evolves when we have sort of this multi-dimensional market between like this intense protocol and the solvers for instance as one as one dimension of this like where how do those negotiations take place? Are are we running these auctions behind the scenes and and it's a matter of you know these solvers holding inventory and this is how the market structure shakes out or you know what are these are these kind of like B2B like people sit down in a room they hash this out face to face in terms of negotiations h how do you think we see this market structure evolve you know as we continue to see intense protocols scale more and more with more volume >> it was funny you know just just taking a

clip at clip from what HB said, you know, we'll make it up on volume. Um there's there's a funny thing there where it's like we have not been taking fees on a lot of this stuff. You know, we've been creating the relationships, creating the network and um you know, it was mentioned earlier sort of the Zcash moment was the was the catalyst for for intense for us. Um I was really worried that um the analogy I use and this is kind of a gross one, but I thought it would be like a snake swallowing a hamster, you know, and you would just see this lump of Zcash thing going through and then we would have collapsed back to where we were. And I think the team that I work with here at Near did such a tremendous job capitalizing on that moment and finding those partners

and building relationship. So >> a lot of it Robbie is >> onetoone negotiations. It's not exactly where I want to be. I'm trying to get to more standardized relationships and and more, you know, fair sharing of value between between the different parties that are that are in the ecosystem. Um, I want that value to acrue in a transparent way. I want I want a I want investors out there to see what we're doing. Like, you know, my dream is for someone to be able to do a DCF on the near protocol. And so, I want that I want the the revenue to be acrewing and to be to be visible. And so, that's what we're working on right now is um going

out and working with our partners. >> There's no specific agenda, right? It's everything just >> it's price and it's value that you're delivering to the end user. Like that's how the decision gets made. That's how they choose their routing. No one is sitting there in the ledger wallet or the trust wallet going I'm a near intense user. They're going that's the best price. I'm going to bang it and that's and I'm going to and I'm going to close that. >> Um >> thank you. >> Thank you so much. >> So we have to be competing on value and and that value has to be you know shared across that those network of partners. And so, um, it's going to be really fun next, uh, 3 to six months as we go and have those conversations. Um, it's it's amazing, you know, for us to have our

real piece of product market fit for for near and to be to be seeing it at work and to have, you know, >> runs that you can put up on the board. Um, but also know that you're providing tremendous value for the end user. And >> I I mean, all of us here have been around long enough, you guys have bridged assets. It's a it's a sweaty moment when you're waiting. I I just remember moving something from ETH to Arbitum and then trying to move it back and it's a 7-day wait and you got to put a reminder in your calendar. Like that's that's not good UX. And so, um, that's what we're trying to do is provide a fantastic user experience and, um, and provide a a thing of high value to them.

And I think we we can and should get paid for that. >> Yeah. Yeah, definitely. AL kind of coming back to your U-shaped curve idea here with regards to the to the market structure specifically within near intense but let's just kind of zoom out to the broader uh crushian landscape and the intense landscape and perhaps this is a silly question but is this just a winner takes most or all market right is it going to be something where um you know we've seen so many kind of like what Vance from framework calls t-u copycats of successful applications that get VC dollars because they think that they're able to kind of you know, take take a small share of a big pie that's been created by the kind of number one here. Near Intense being the the leading

kind of intent crushing provider amongst tons of other uh crushing providers, how do you see the competitive landscape for Intense playing out? If if if we're uh convinced that Intense are are likely going to be the um you know, at least part of this endgame of the crosschain abstraction that we've been looking for. Um, isn't there going to be a lot of people coming for this market? You know, how do you think about that uh playing out as as we scale from 10 billion to 100 billion to, you know, trillions? >> Uh, yeah, I think there will likely be people that try. I think with these kinds of things though, there's a real network effect. Like if you assume that the market is going to be fragmented on both sides, then there is a true network

effect phenomenon. Which is why I really agree with what I was saying, which is I think you don't want to worry too much about value capture on the front end. You just want to get to scale. um and and sprinting as hard as you can to get to scale means you lock in the network effect and then and then if there is a true network effect which I think there is here uh between the applications and all the chains across which you need to route um then then that almost always results in some significant efficiency could be depth you know depth liquidity pricing advantages settlement times there's like a lot of dimensions of efficiency you might get but that network effect will give you all of that efficiency and then at that point you have you have pricing power um and I suspect this is going to be a winner

winner takes both like it's likely some sort of power law where the winner for whoever is routing across all the chains and across all the devs and settling all of this stuff. Um that likely is like the winner takes 70 or 80% of the market and then there will be some specialized you know 20% that's scattered between a couple other folks but it's going to look you know like uh social networking or payments or or search like it's going to be a power law. Um and and I think um that's that's what I'd be focused on if I were in your team right now is just like market share. How do you just get to max market share? Because you know the market here is going to be 100x, a thousandx, a millionx bigger than it is today. We're still very early days and that early network effect will compound.

So if you can be if you can be like Facebook and just win colleges, you can take that and you can back into everything else and then as the market grows then then you win then you're a trillion dollar company. >> Yeah. So if >> two things two things I want to add to that is that you know imagine alternative world where near was charging super high margins and they were making a bunch of cash uh that's actually the world where you want to be more afraid of competition because everybody's going to see huge target on your back. People are going to come and undercut you. They're going to they're going to try to compete for that margin.

But if you start super low margin and you basically say, "I'm gonna go low margin or even go zero margin and just dominate the market first, then all your competitors are screwed because nobody can come in and really compete with you. And even if they do, unless they get to scale more than you, there's no prize waiting for them at the end." So that, you know, it's hard to compete with free. And this is one of the things that social social networks learned very early on is that like, yeah, don't charge anything, just get to scale, dominate the market. So I I like this version of the world where NAR is basically just completing and dominating the market. The second thing I'll say is that you know one thing one thing one thing to recognize is that we've seen this enormous growth in per in uh Pers

onchain and this is in large part because you know these are cash settle instruments very very easy to do on chain not very easy but obviously straightforward enough because all you really need is to know what the mark price is to have some funding rate to have enough liquidity for the market to clear and boom you can trade anything. But the problem with that theory is like okay yes you can trade anything but you can only trade the price you can't actually get the thing that you are buying. You cannot get Zcash through hyperlquid and if what you want is a property of the underlying thing like if what I want is privacy you don't get privacy by swing trading Zcash on hyperlquid you only get privacy by actually getting the Zcash. And so as we start thinking more deeply about why people are using crypto and what they're

using crypto for, you know, it's like I I don't want to be long a USD per I want a stable coin. And that's a big part of the reason why the the the DeFi story of just the rise of derivatives is not enough to satisfy the whole picture of why DeFi is so valuable and so important. The other side of that is the physically delivered stuff. That's what near intense is all about. So then would a structural risk to the intense thesis being that users don't actually care that that they get the actual asset? >> Yes, that would be a huge structural risk. Um I don't think we're that much worry that that will happen. I think it's pretty clear that people I mean you can see already from the underlying demand that yeah people want to use stuff that's available in other chains,

right? I don't want soul if I want to go onto Salana. I want I actually want soul because I can't pay fees with rap soul. >> Looking for yield that stands out? Infinify gives you just that. Deposit stable coins and earn far more than the current savings rate. Infinify is a battle tested, reliable DeFi platform that is ready to go. Head to infinifi.xyz. Holiday is unified crypto payments. Give your users more wherever they are. Go to holiday.xyz to never write a smart contract again. Trade on anything. Economics, weather, sports, crypto, and more. all on couchy.com 24/7 for the world's biggest prediction market. Um so outside of the competitive pressures then guys um and

the actual asset issuance what are the other structural risks that you see from the investment perspective for intents as a as a category? Is it is it other bridge designs winning out? Is it uh the multi-chain landscape kind of fails and we get a lot of consolidation across activity into just a handful of chains? Is it some sort of structural third-party um you know I don't know like going like uh solvers going on strike and being in a union like what are the other structural risks to to this thesis outside of uh competition fees and asset issuance or asset types >> or is there any I mean >> I I think I think we're on an inevitable path right

>> DeFi is 25 26% of of daily trading that's up 6x over the last three or four years, we're going to see more and more people moving into DeFi. As Steve just said, like people want access to the raw underlying asset. They don't want the wrapped asset. They don't want the derivative of the asset. They want the asset. Um they want to hold it in their wallet. They want to know that they that they own it and it's, you know, it's it's safe. Um I I think Intense grows for for me like Intense is not just a swapping mechanism. It's not just a crypto mechanism. You know, our long-term vision is this becomes the commercial arm for the for the the artificial

intelligence agents and transactions that are coming. And you'll see us build out intents in that way. So, we'll move from just a on the spot swap between HB and I to a escrow transaction between Hib and I to a contractual relationship between Aashal and myself. Like that's where we're going to see it going. um we're going to see it move into physical goods and um this was a tremendous proof point but that's the that's the long-term vision. >> Hey, how's it going? >> You know that that intent intent concept.

>> I I would add kind of two things. Um one I think DeFi is obviously is certainly going to take off. I think Trafi is coming in like this is you know when we talk to people in New York and Wall Street like they're going to tokenize everything. It's very clear. >> I don't know if I should and that has to sit somewhere like the I don't think it's going to be that there's just like one chain where all the tokenized stuff sits. There's just too many competing interests. It's going to be complex, right? I think it's going to be many many chains, many many base layers, many L2s, many L1's. >> Uh and so, uh I think that fragmentation creates opportunity for intense. The other thing to think about here is the rise of agents and I think the agentic economy while very very nent right now,

I think if you look at any other financial market, you know, if you look at the stock market, it's mostly algorithms. environments. >> So, we're used to this world where there's like a bunch of humans clicking on buttons on in DeFi. What we're about to hit is this world where it's all bots. Um, you know, there's obviously a bunch of bots at the MEV layer and like in transactions right now already, but like when you can vibe code a bot that just does a thing on your computer, um, or every single app has some agentic interface. Um, I think you're actually talking about like an entire TAM expansion of a millionx, right? Like I I think the actual users of this stuff are not quite here yet. Um, and once the agents are here now, now now you're talking. Um, and I think that happens

over the next two or three years. >> I'm a charms. >> Last thing I'll say, yeah, last thing I'll say just just to put a bow on that is the reason why intense just just to hammer this one more time like even if you just want exposure to the price, right? Let's say let's say I'm buying Bitcoin and I'm not buying Bitcoin because I'm going to be using Bitcoin fees to transact on Bitcoin, but I just want to own the Bitcoin, right? Even in that world where I just care about the price, if I'm an agent or if I am, you know, somebody that just doesn't really, you know, look, Hyperliquid is a great exchange, but if I want to own this Bitcoin for multiple years, do I really want to have an open derivative position on Hyperlid for years? Like, do I know what that's going to look like? Do I

know what the funding rates are going to be? Do I know the exchange is going to stay up? Do I know what's going to happen to my positions? Do I know there's not going to be a Hyperlid V3 or a V4? Um, I don't know any of that. I don't care about any of that. I don't want to know about any of that. All I want to know is I have my Bitcoin and you leave me alone. And so the the instantaneous trust I have to have of simply does this intent network work. Am I getting a good price? That's the only thing I need to know. The moment I I have that interaction with the intent network, I am done. All I have now is Bitcoin. All I have now is Zcash. All I have now is the tokenized stock. Even if I'm an institution, I don't want to have

a long-term position open on some some DEX. I just want the tokenized stock. Give me the tokenized stock. I want no further counterparty risk than whoever actually did the tokenization. The end. That fundamentally is why I think this stuff is going to continue to grow. Institutions care a lot about counterparty risk. To say nothing of individuals. >> Gentlemen, thanks for joining. Uh it's it's the intent day special today. It's a bit of a mega stream. Thank you for being a part of it. Congrats on the success on this investment, Matt. Great work. Um always good to have you. >> Always good to have you guys.

>> Pleasure. Shout out to the clean room guy, >> Alex behind the scenes cooking.