🚨LIVE: Hayes' Trifecta Flying. Crypto x AI? Chainlink, Upshift & Superstate, FT Crypto & Relayer

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[music] [music] Heat. Heat. [music] [music] Thank you Lord.

[music] We'll see you around the timeline. Feels [music] good to be back. >> I think The Rollup is one of the most premier media brands in crypto and Andy and Robbie are great experts [music] at everything they talk about and it's my favorite podcast. >> Adding it to my library every potentially multi-chain deployments. Here we are at [music] day one here. I'm testing from base. [music] [music]

[music] >> [music] [music] [music] [music] >> Heat. Heat. [music] >> [music] [music]

>> JP Morgan, Black Rockck, DTCC, Fidelity, the entire thing was just institutions. 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. >> I'm bullish. >> He said it. HE FINALLY SAID IT. So bullish. >> It is bullish. I'm bullish. We're bullish. [music] >> [music]

[music] >> Heat. Heat. [music] [music] Heat. [music] Heat. [music] [music] >> [music] [music]

>> Corola [music] is headed to the top. If we're not already at the top, we're going to the top. >> Roll up is my favorite. >> From all [music] walks of life, all over the world, all over this industry come together for the roll up. [music] [music] >> [music] [music] [music]

>> Zoom out. The institutions aren't coming. They're simply here. It's the golden age of crypto, guys. Get right. Let's go. [music] Welcome to the next. See you on the show. What's going on guys? Welcome back. Happy Friday to all the Zcashir hype believers. Ladies and gentlemen, we are ripping. We are ripping. Robbie is at a family graduation event. So you guys will be rock with me all day. Happy Friday. We are live from the financial capital of the world. You're watching the rollup. Today is Mon Friday May 22nd. We have a great show ahead. Before

we get into it, shout out to our friends at Plume. We are at the Nest by Plume. Let's give them some love. They're doing great job. They got their Bermuda license. Plume's crushing it. Stoked to be in the office here in the Empire State Building. Ladies and gentlemen, we are at the tokenization tower. We got Chainling God joining the show. He is going to be talking about the billions of dollars migrating to channeling CCIP following the kelp incended. We got upshift and superstate calling in as well and Franklin crypto head of their new Franklin crypto division will be at the nest. Uh and then we also have the

AI supercycle with relayer capital founder Austin Barack. good friend of mine. Um, also been very very right as of late with his thesises and with what he's seeing in the market. Let's get right into it, guys. Before we do, let me tell you about Fracks, our premier stable coin partner, building the future of digital money, open, stable, and borderless. For more information to start using the future of digital money, visit fracks.com. It is a beautiful day in New York City. 65 degrees, partly cloudy, but man, it's sunny. It was supposed to be a rainy, shitty Memorial Day weekend, but I think we're starting strong. Not so sure how

the rest of the days are going to come. But today was amazing. Walked outside in the morning, got a nice sandwich, uh, coffee, and went for a little walk, and it was just perfect weather. Perfect weather. So, I mean, it's hard to not be happy about the weather when Hyperliquid's at all-time highs. Zcash Fly near ripping. We've been harping on these for a while. They keep doing well. The weather is powered by our friends at relay relay.link for your favorite crosschain swaps and anything else in the digital asset landscape. Let's keep it rolling into our friends at near. We are we are powering the show with our new

tokenized equities partner dinari. Bring them up. Infrastructure for tokenized equities and bringing real world stocks on chain. Do more with your stocks with dinari. Ladies and gentlemen, the market is looking pretty damn good. We need Bitcoin to hold this level. This 77 level. What's up one arm bandit? What's up my dude? Get in, send it, pump it, huddle it. Just don't miss it, man. Good to have you back, man. Uh, Bitcoin 769. We need to hold this level. Uh, if we don't hold this level, it's going to be hard for the market to really be able to get more out of this hype Zcash near

trade near at the bottom at 2.17. I mean, we were covering this thing before we left on our conference trips and it was 1.3. it was at 1.3 and so I mean look I know I know people wanna let's get you know the 100x and all of that but near is wildly undervalued still and doing quite well just holding that 86 mark chain link up a little bit as well Ethan Bitcoin just continue to kind of mull around um don't really have an understanding or reason why here I'm honestly not paying that much attention to either of them other than just making sure and hoping really that Bitcoin

holds that 7780K level. Man, if we get any action on Bitcoin, like I mean anything, the slightest hit, things across the entire market are going to fly. Today's digital asset market prices are powered by our friends at Zama. As always, visit zama.org org to learn more about their confidential transfers and confidential private payments with their new Zama portfolio product coming out very soon. All right, guys, let's get into the news. Before we do, let me tell you about our premier AI partner, also ripping face, Near. The blockchain design for AI native applications and autonomous agents start developing today at near.org. Use near.com for their

multi-chain confidential intense product as well. Let's get into the news. We had Zama today come out and say over the last couple of days I I I believe this dropped a couple days ago. Zama acquires Token Ops. Token Ops previously handled about $2 billion in distributions, vesting and compliance flows, but they did it all publicly. Zama integrates FHE, fully homorphic encryption, plus ERC7984 confidential token standard to make auditable unlocks, airdrops, and token allocations in a private fashion. This is huge. Play the video. There's an

institutional angle here designed for token managers as well. RWA's needing confidentiality without leaving the safety of public blockchains. Again guys, Zama is leading this shielded narrative. They are an absolute slept on team of course a partner of the show. However, they are slept on in the privacy space. This acquisition of token ops further deepens their ties into the actual use cases. payroll, payments, token unlocks, airdrops, distribution, vesting, all of this is going to have to be private in the future of this onchain economy. Zama's doing it. I think the

token is undervalued. I think it looks great. If privacy is getting a bid, Zama and Zcash will probably be be doing quite well. That's Zama. That's token ops. Let's keep it moving. Our boy Michael Sailor is honestly not leaving me with much hope. I mean, I I just wow. Just play the video. This is just unreal. Unreal. >> Let me recap Q&A. [laughter] >> I too too good to be true.

[music] >> Let me tell you about Bitcoin. >> Turn it up. Business as usual. Candles [music] go red, timeline screaming, we just nod our head. Business as usual, no despair. All we really want is [music] Bitcoin per share. Not too fast, [singing] not too slow. Let that orange engine go. Not too fast, not too slow. If the stack keeps growing, [music] let it flow. Digital credit, digital flame. Old Wall Street still learning the game. They say, "Wait, how you pay that yield?" We say Bitcoin, baby. Bitcoin, baby. Good to be true.

Let me tell you about Bitcoin. [music] >> Hardest money. No coin. Bitcoin [music] per share. >> This guy owns the most Bitcoin in the entire world. The largest corporate holder. >> As usual, >> orange everywhere. >> They call it magic notch math with drip. Orange coin under the whole damn ship. Waves hit hard, but we don't bail. Flex, don't fail. Ride that gale. So they panic cell. We calculate. They refresh charts. We educate. [music] They ask, "Is this some kind of trick?" Nah, bro.

It's credit with a Bitcoin kick. >> Do no harm. Protect the chain. Flex through pressure. Rise again. Do no harm. Protect the chain. It run it back. [music] >> Let me tell you about Bitcoin. >> Too good to be true. >> Hardest money. No [music] coin. business as usual. >> Bitcoin per share. >> All right, I've had enough of this. >> Oh my goodness. AI generated recap of strategy retail investor Q&A. The Q&A recap. Where's the yield come from?

Bitcoin, baby. Okay. Fong Lee, Natalie Brunell, Sailor absolutely polarizing the entire video content landscape saying that basically Wall Street is assuming that this stretch product is completely and utterly Ponziike and Sailor's description and explanation for it is Bitcoin baby. New type says, "Now I wait for Zcash versus Bitcoin AI music fiddle."

Oh my goodness, man. This uh Zcash being the better Bitcoin narrative is definitely is definitely interesting. So, I wanted to talk about that because I mean this guy is the biggest holder of Bitcoin in a corporate treasury fashion and the meme ability is just it's kind of unreal. It's kind of unreal. Like I I I would not have expected Sailor to come out with anything similar to that at all. So I mean this is like the internet culture taking things to the next level consistently and memeifying being a financially or being a steward of

financial capital memeifying to the max. I I don't have much else to say. All right, we're going to keep it rolling into Jane Street and some quants. Before we do, let me tell you about Infinifi, our local DeFi partner. Building DeFi infrastructure for simpler access to onchain yield liquidity, capital allocation. To learn more about efficient onchain finance, visit infinifi.xyz. So, our guys at James Street, these are the types of quants that you're competing against trading in the stock market. This is why, you know, this is why I've crashed out after trying to trade commodities and just fully back all in on the big major Zcash hype near.

Let's play this video. You're running big models to in in the middle of making trading decisions. >> I think the thing to understand here is there isn't one time horizon. There are many time horizons. Uh there are trading systems we build and trades that we do where in order to be competitive you actually have to turn around a packet in in under a 100 nconds and like that's a very different regime right you know people sometimes talk about like oh can you guys write high performance stuff in Okamel it's like we can but like for this kind of speed it's like it doesn't matter if you write in Okamel or Rust or C++ you can't use a CPU right you are going to be on an FPGA that's like direct wire attached to the network and you're going to be turning around the

package so fast that if you like attached an oscilloscope to the wire on the way in and the wire on the way out, you would see the packet start to leave before it's done being consumed. So it's like a very different very specialized regime, but like when you're in that time regime, you really can't do very much computation. The decisions you're making are going to be very simple. And in fact, there's this kind of whole curve of trade-offs between how smart is the decision that you're making, be it a model or some other kind of maybe even like handwritten decision-m process, and how fast the turnaround is. And like the the right way to build uh an optimal trading strategy is really to have a kind of ensemble approach where for some kinds of decisions you're making very s simple decisions very quickly. for some

kind of decisions you're operating at the scale of you know instead of thinking of a 100 nanos maybe like a handful of mics or tens of microsconds or hundreds of microscs or milliseconds and in some cases there are processes where if you can get that decision turned around you know in an hour or that day that's totally fine and you're you're kind of competitive on a time basis at each of these horizons uh but you're making very different kinds of decisions at all of them Maybe you can't say but what what is it exactly these models are predicting like surely it's just not the next thing in the order book or maybe it is >> right we're definitely like dancing towards stuff that's hard to talk about but I think the simplest and most important one that we've been thinking

about like we think about it now but like also 25 years ago when I started at James Street when I was building like models out of linear regression you know and stuff like that like a very useful kind of thing is to predict a fair value for a thing like what do we think this thing is worth and that fits in in a very kind of composable into lots of different trading processes. That's not the only kind of thing that we use as a prediction target, but it's an important one. >> Yeah. >> So, I'm just glad that Jane Street is out of this market because they were nuking Bitcoin at 10:00 a.m. every day like clockwork. Um, pretty much every day like like clockwork. And they're now out of it and they are not nuking Bitcoin every day like clockwork. They

are not. Um, and I'm glad that they're not because they were always every 10:00 a.m. shift in Bitcoin, they were they were nuking the market and now they're not and it's better. Bullish0cash is private quant proof and still a chance to be a neutral asset for sovereign funds. Bitcoin is tied heavy with USA so other countries may be hesitant to invest in BTC new type. Um interesting. Uh your favorite stocks are now tokenized crushing at 10 cents a time. Something amazing one armed. Yeah they are. They are and they're coming on

chain. So pretty excited for that. All right let's keep it rolling. Uh we've got I think poly market got drained 660K compromised internal key. uh platform says that there's been no smart contract exploits that users have to worry about in these instances. I always kind of tend to just want to pull back and pull out of smart contract platforms like this. So, not what you want to see from the world's largest prediction market, but I did make a $100 last night on Kouchi. Um let me check. Let me just check that actually.

So, I took the Knicks to win by over five and a half points and I put 100 on it and bang. Yes. Got 194 now. So, let's go Knicks. Great win last night. I am not going to gamble that tonight cuz that's how I will lose it. Just for the Knicks. So, all right guys, we've got Zack Ryan, the the leader of strategic initiatives at Chainlink. He's gonna join the show next. Um, and Zach is a friend of his show and and he is a longtime partner of Chainlink and and community supporter.

So, we're going to get Zack up, but before we do, let me tell you about LeFi, building infrastructure for crosschain swaps, bridging routing across the onchain economy. To explore smoother crosschain execution, visit lee.fi. Bye. Let's get Zack up. He's going to be our next guest here live from the tokenization tower at the Nest powered by our friends at Plume. It's been a crazy week in the markets. It's been a wild month for Chain Link. Let's get Zack up and let's get him started. >> Hey, Andy.

>> All righty, Zach. What's going on, man? >> It's doing well. How about you? >> You must be busy, man. Been uh it's been a wild wild month. Yeah, to say the least. I I mean it seems like every everybody's getting hacked. It seems like what's happening with uh AI. I don't know if that's what's accelerating it, but across the industry, it's feels like it's it was a flood. I think April was the biggest like number of individual exploits in that month alone, which is just absolutely crazy to see. Yeah. I mean, we just covered Poly Market had an exploit today. I saw another one on a bridge earlier. TAC Finance. I mean, it's every day. And you know what it feels like, Zach? is that it feels like

it's just feels like it's just like these old like less uh taken care of GitHub repositories or code bases that you know these protocols have a couple million bucks in TVL or something and they just haven't updated the codebase or thought about or touched it in a while and it just feels like there's like this all knowing intelligence that is just like seemingly scanning across all these potential honeypotss and just looking for opportunities and just picking thing off picking opportunity is down like flies. It's just a really weird dynamic.

>> Yeah, I feel like there's there's different categories. You have definitely the projects that are, you know, it's a bit of a bare market. There's not much development support going on. They don't have a lot of security asurances going on and people find, you know, code uh bug exploits and code that's been deployed for years, maybe AI assisted. But then you have a category of teams who don't have proper operational security and you just see private key compromises happening left and right. And it's I think it's insane that in 2026 that a single private key getting compromised can destroy hundreds of millions of dollars in value. But that seems to still be happening in our industry. And I think that's I think that's the biggest shame is that the these were private key exploits are preventable issues. Code exploits, you can do audits, you can try and protect

around it, but you know things happen, but private key compromises it. There's not there's really not an excuse for those situations. >> Yeah, man. I mean, obviously what happened to layer zero about a month ago has led to a significant uh kind of reshuffleling of the crosschain landscape with regards to quite a few different teams pouring over notably most recently Turtle Club to using Chainlink CCIP. So I'm just curious man from in the last month like take us through what's been happening uh behind the scenes talking to teams talking to security researchers talking to founders who you know want to secure their crosschain landscape what

has been happening from the chain side over the last month. Yeah, I think the the layer zero exploit was really a wakeup call for a lot of the industry. I think a lot of people never thought or really looked into the differences between different crosschain infrastructure providers, but I think I mean over the past month or so, we've seen about $4 billion worth of crosschain token value migrate from layer zero over to CCIP. That's teams like Kraken, Lombard, Solve, teams who have these these tokens that are worth in some cases billion. Kelpo themselves migrated over to CCIP. And I think that people are realizing the the difference in security philosophy that these different infrastructures provide. Layer zero is a bit of a ad hoc

do-it-yourself. You can you configure it, you can secure it yourself, which can work if you're an experienced team, but a lot of devs are not crosschain infrastructure security experts. They just want to bridge for their token so they can distribute across multiple chains. They'll stick to the defaults or whatever is recommended to them. And when the defaults are unsafe, as the layer zero team themselves have said, they're unsafe, then that leads to just immense centralized points of failure. CCIP is designed fundamentally differently. It's secure to be secure by default. Every bridge lane is 16 nodes, native rate limiting, multiple layers of defense implemented into the network by default. And if you want to add additional security and configure it, you can do that, too. But you're not

expected to be a security expert just to use CCIP. So a lot a lot of these teams, you know, they saw the layer zero exploit and they started to review their own infrastructure and their own bridge security assumptions and a lot of them are reaching the same conclusions that infrastructure that they thought was secure was actually not secure and when they evaluated the landscape it was obvious that CCIP was was the secure by default solution that they didn't have to spend time money resources trying to build their own infrastructure when there's already a secure solution. So a lot a lot more of these teams are reaching these conclusions and they're and they're shifting their infrastructure stack over. So that that that's been the major shift that we've seen over the past month and more teams continue to re-evaluate their security posture and it's not even necessarily

just crosschain. There's been uh price oracles that have been having issues over the past month. Chaos Labs was compromised. Pith just went down for four six hours this morning. like multiple different types of infrastructure providers uh across data and crosschain have been having issues and chain link keeps operating as it always does with without without incidents. Crosschain transactions keep processing. I mean at this point uh chain link secures over 110 billion in value. I mean that's that's 70% of DeFi plus 60 billion in crosschain tokens. So, it's it's it's dominating the the uh uh market value and the DeFi TVL market uh by a large margin. Yeah. And I think right now I'm seeing some some reports

that DeFi insurance is now pricing layer zero uh three to five times higher in terms of ensuring the crosschain architecture than chainling CCIP. Um, you know, I'm just curious like how how much more how much more risky are a lot of these other oracle designs than chain link? Like realistically, like is 3 to 5x fair for those names that you've named? Like let's just let's just be objective here, right? Like I know big chainling bull, but like when it comes to pure risk understanding and analysis, how how do you what is the right way to

think about the the the the risk spectrum in oracles right now? >> Yeah, I think there's one of the primary differences is that when you're integrating with a chain or service, you're getting a strong security floor. You know what your security assurances are. They're standardized across all integrations. So if I'm a token that is integrated with CCIP, that security assumption is is the same across all CCIP enabled tokens. So if I'm an insurer or I'm a market curator or I'm you know whatever kind of DeFi operator and I see a CCIP integrated token, I already know what the security assumptions there are. I don't need to do a lot of due diligence. I just do the due diligence once and the model is the same for everyone who integrates with that infrastructure. infrastructure like

layer zero is fundamentally different in that because it's do-it-yourself, bring your own security model, you you can't just assume that every the integration is the exact same. You have to analyze individually each integration which becomes very difficult because if you have when you when you're configuring a bridge, you have to consider every chain lane, every connection between different chains as an attack vector. You just need one bridge lane to be compromised and the whole token can be exploited. Infinite Min attack, a bridge contract getting drained. The RS ETH issue was just one bridge lane between Uni Chain and Ethereum. You only need one chain lane to get compromised. So you need to not only investigate and do diligence in every single little configuration, you need continuous monitoring because it could change at any time. That configuration that was one way on

Wednesday could be completely different by Friday. So you need to have this continuous monitoring which for markets that are listing hundreds of tokens, it's not super practical. So the best risk reduction move is just to have more conservative risk parameters for that asset. Whereas with CCIP, you don't need to worry about that because you know it's a standardized security model across all integrations. So that that that that's a huge difference just in terms of numbers. A lot of the bridges that are operating on layer zero, you know, kelp was a one of one, but a lot of these bridges are two of two, which is not that much better, particularly when CCIP is 16 nodes by default. So CCIP is eight times more decentralized than the default configuration of layer zero. And even the best 404, which we've seen some of those bridges come out,

that's still four times less decentralized. Like there there's not even a single slayer zero bridge that's half as decentralized as CCIP. So you have to take these things into account when you're analyzing the risk of a token. You can't just consider, you know, market curators will look at liquidity, they'll look at volatility, you know, they'll look at, you know, the supply distribution because those are all economic risks when you're lending and borrowing and using assets in DeFi. But the bridge risk is significant like that that could completely zero out a token or cause it to become under collateralized even if it's like a crypto commodity native asset. So these are all risks that market actors and insurers and curators have never had to really consider before but now they're being forced to consider and the the most straightforward path is you have to put a discount on riskier more ad hoc

infrastructure that's much harder to monitor over time. >> Yeah, I mean I think that's what the market is kind of adjusting to. That's why we've seen this migration and that's why you know these larger node architectures have been you know were the output of the initial smart contract era. If you remember Ethereum's claim to fame has always been the most resilient immutable blockchain. However, we kind of went through this phase of time where we took it to the logical extreme on the other side and we ended up, you know, frankly with some with something that I'm extremely bullish on, which is Hyperlquid. But all Hyperlquid is is a 16 node blockchain, right? a lot of them in Asia and Tokyo and and it's a great

product extremely performant amazing technology but it's like the whole industry went down the path of performance and UX over decentralization and I think there may be kind of some steps back from there even lighter as an example for a perex has very interesting or just launched very interesting zk technology allowing effectively emergency mergency escape hatches without the need for um the actual uh you know admin key or multi-IG etc. And so I think that this trend is like ever growing this kind of like returning back to the other part of the spectrum. And a lot of these things Zach are actually as

with anything specifically in crypto especially though and in crypto investing the path dependencies become very very uh clear in hindsight, right? like this event is very clearly a path dependent event that is going to favor a more a stronger outcome for chain link you know and it's just like you couldn't have sure you know you've been harping on this but until it happened it it wasn't so obvious that chain link was you know in a stronger position and so I'm just curious more about like a longer term outlook understanding the spectrum understanding like how kind of path dependencies affect investment performance in affect the way that industries are really just created,

right? Like this event has ramifications on the way that this industry is going to evolve. How do you how do you anticipate this kind of broader trajectory within the industry and then as well as chainlink specific position as it pertains to this kind of path dependency returning to fundamentals kind of event that's happened. How do you think about this going forward? Yeah, a trend that we have seen historically is that in a bull market, it's move fast, land grab, got to get the users, got to get as many chains as possible, got to expand, expand, expand.

And security, reliability often takes the back seat in those situations, unfortunately. And a lot of the users, they might not be the most technical or the most sophisticated. They don't need to be, but they don't necessarily realize that there are corners being cut, that there's been compromises made. And unfortunately, some of that infrastructure is able to obtain market share. And then an incident happens like the layer zero exploit and now all of a sudden everyone go realizes okay security is actually an important property particularly in an industry where the whole value proposition is automated programmatic finance. If there's an issue in this automated financial ecosystem that creates cascading effects and then you combine the composability of DeFi with that and it creates contagion and now you have the whole ecosystem at risk and that's

that's the biggest risk of DeFi is is not even necessarily like token prices. It's that there's some dependency that breaks and causes a cascading failure. That's the biggest risk by far and I think going forward security will be in an heightened importance particularly for infrastructure. But I think the way the industry is moving is that while DeFi has played a very important role in the past, I think it's pretty obvious now that institutions are stepping in. Stripe has their own blockchain, DTCC has their own blockchain. And when these infrastructures are looking at what oracle infrastructure they want to use, what crosschain infrastructure they want to use, they're going to look at the historical track record of these infrastructure providers. So I think that reason alone puts Chainlink in a

very, very good position. I mean, just a few weeks ago, we saw DTCC announced that they're using Chainlink infrastructure for 24/7 collateral management on their DTCC collateral app chain, and that was in large part chosen because of Chainlink's historical track record in addition to its platform services. But I think that institutions, their bar for security and reliability is just exponentially higher than anything in DeFi. And not because DeFi doesn't care, but it's because they're managing trillions of dollars in assets. they manage quadrillions of asset flows and volume per year like they they have to care because if they don't all of society is at risk and so that their stakes are much higher and then you throw the compliance and the regulatory liability risks on top of that like

they're going to prioritize security. So like you know chain like getting integrated with a D5 protocol that could take a day you know you you you kind of just swapping some contracts getting integrated with a trify institution is like a multi-month process because they have to you know cross the the the dot the eyes and check the check boxes and look at the compliance sheets and like make sure that you have the right certifications and the right audits and like it's a whole it's a whole thing. It's a completely different world out there. So I think as as the use case of crypto has become finance and moving assets and trading assets and financial applications and the obvious next step is to bring more traditional assets on chain. You know the SEC has the exemptive coming out for tokenized stocks. Uh you have more and more

equities, money market funds, all all these kinds of financial products coming on chain. All of them are going to look at what's failed and what's worked in the past and apply that to their own strategy. So I think that's I think Chainlink's probably the best position from a from a security reliability perspective by far. >> You know, Zach, I think I totally agree, right? And I think a lot of people agree with that and I think the only thing that people are fussed about is $4 billion in transfers from layer zero to link as far as the infrastructure transfer Kraken solve Lombard yet the token barely moves a couple percent like what what's the investment thesis for the holders? Tokconomics are not looking aligned with usage. people are really just looking at how how is this thing not moved, you know, with the

likes of some of these other assets. Why? Why after all these years of success is the link the asset still not being prioritized by leadership or by the community or by the team and like what really is the investment thesis here and I think if you zoom out it's it becomes clear but you know speaking to the community here speaking to the holders how do you how do you you know rectify uh this massive migration that's happened that's going to continue to happen with kind of uh uh not not a strong reciprocal effect in the token market.

>> Yeah, I think that link as an asset is relatively difficult for a lot of people to understand because when you look at like the top 30, top 40, everything's pretty much a blockchain or a stable coin and people understand what a blockchain gas token is, how that's used. People know what a stable coin is. It's not really an investment, but like that's the other asset. Chainlink is the only non-chain infrastructure within the top 50. And unlike chains which h like hyperlid which is fantastic don't get me wrong I love hyperlquid but all their revenue is onchain and everything's programmatic and visible onchain chain link's economics are fundamentally different in that it's not just dealing with onchain value flows but also signing enterprise deals with banks and so that has that requires a completely fundamentally different economic model that requires the ability to take in

fiat payments convert that into link and use that towards the network operations. So it's like a fundamentally economic fundamentally different economic model that no one has seen in the crypto industry before and I think a lot of people have a difficult time wrapping their head around it. But I I think that the market would event will eventually catch up and understand that the fundamental value that chain link provides is undeniable and the value capture is not any different than infrastructure we already see on the market. I mean Hyperlid the most prominent example what's their economic model? They generate revenue they buy back their token. It's fantastic because they make a lot of revenue and it's a great case study. Fundamentally, the chain link model is not any different.

You pay for services in link, you pay for services in non-link, it's converted to link through a buyback model. Staking will continue to expand. Uh link itself is a store of value just like every other crypto asset in the space. So, you know, people have different stories that they tell about different assets in the space, but at the end of the day, what really ultimately matters is that you create a product that's good that people want to use. you're able to obtain dominant market share, you're able to monetize that market share, and then you're able to apply that monetization back into the token. And I think where Chainlink will really shine is as institutions continue to step in because that's where the money is. Like DeFi is broke, unfortunately. Like a lot of the monetization that's taken place to date has been through chain integration

deals. And that's worked very successfully thus far, but there's not an infinite number of chains. the real money maker is coming in and doing revshare deals and different kind of deals with institutions as they increasingly come on chain and then that gets diverted and flows throughout the system through these different economic models like the the actual economic value distribution flow is like a solved problem. It was solved like 150 years ago through buyback programs and you know dividends like that's that's how you acrew value to an asset. The hard part is creating a useful product that has lasting stable power that people want to use, people want to pay for and becomes the standard. like it it's been I think it's taken longer than most people even myself has anticipated to get to this stage and get you know I thought 5 years ago everything would be

a smart contract you know I thought everything would be on chain many many years ago but yeah you know it's it turned out to be a little bit more nuanced than that situation but I'm still fundamentally bullish on the the idea of blockchains and smart contracts and ultimately like if crypto blockchain smart contracts as a technology wants to succeed it needs a platform like chain like otherwise If you know chainlink doesn't succeed, neither does the concept of smart contract applications in in in my opinion. [clears throat] So they're kind of the these destinies are intertwined with each other. And in the short term markets are irrational. I mean I just point to XRP and I I still don't understand where the markets head heads at with some of these coins that have nothing going for it other than the mimemetics and the you know cult

community which is valuable but it's just a you can't really quantify the value of that but it still exists. So that's kind of where I'm coming from. Obviously, I would be a beneficiary of of seeing seeing link do well, but I I I have strong conviction that's the market will recognize the importance of chain link. >> Yeah. Are you um are you um of the mind that this growing like growing situation in the market of look this token has this fundamentals this revenue you know it it has this many flows it has this much emissions this token is such that the net value flow in terms of like the P or like the

plus minus here right so The plus being revenue coming into the asset and the minus being effectively everything from unlocks to emissions to inflation to team payments to salaries to payroll etc. Like are you of the mind that these that the market is starting to really accept this net token value flow with regards to hey we're going to analyze assets based on their emissions based on their plus minus and kind of like a debit and credit outlook towards these assets like do you see that as being a very sticky part going forward in this market like a sticky way to invest and

think about these assets? Is it really like this plus minus kind of like credit and debit uh way of assessing whether a token is investable or not? >> Yeah, the way the way I look at it is who is going to be the next marginal buyer and what is their model going to look like? And I think retail is dead currently. That money is not coming in. It may come back, but you never you never know what that's going to trigger that. I didn't think it was going to be NFTs, but that's what happened in 2021. But I think the next marginal buyer are the more of the institutional archetype. Like they're going to be looking at they're going to be looking at the flows. is they're going to be looking at the revenue. They're going to be looking at the value crew model and they're

going to want to see a model that makes sense even if it's not necessarily uh net positive inflows in the short term. If there's a model that works in the long term and really it's effectively only two things, some kind of dividend which is a staking reward or some kind of buyback model which is just a buyback model is the same in crypto and are you able to achieve the monetization and the network effects required to uh get that flywheel engine running? I think that's going to become increasingly important and I think a large reason why hyperlquid is going to keep getting more and more attention because it's such a straightforward model especially as they continue to expand into tradi and trady recognizes hyperlquid that model of it generates revenue and buys back its token is just intuitively obvious and I

think more and more projects are starting to shift towards that direction. Chainlink took that model and applied it to not just onchain revenue but now also off-chain revenue as well. So, I think there's a lot of different ways you can actually take this economic model and and explore it. But I think the idea that like my token is money and people are going to use it as a store of value. I think that story is dead for most assets. It it works for Bitcoin, kind of works for Ethereum. For everything else, it's dead. Like that story of being a memecoin, I don't think is going to entice the next marginal buyer. Um >> Yeah. >> In my opinion, personally.

>> Yeah. You know, Zach, one of the things that we've been really pushing on the show is look, we've been thinking about this industry in this in that lens that you kind of speak on with the next marginal buyer token value acral token flows. But we've also been extrapolating that and that concept into well, the reason why is how you said, right? It's the institutional allocators, these people that think about these assets in a certain way. But what also is happening is a lot of us have been thinking about the industry for the hundred billion dollars on chain three to4 trillion dollars in the total market cap and that all the D5 protocols exchanges oracles lending markets etc etc etc are all just for crypto assets

but very obviously that kind of notion is being shattered in front of our eyes right like this industry is building an alternative onchain ecosystem for tokenized assets of all types. And so the scale that we're talking about, you know, goes from a couple hundred billion to a couple hundred trillion like relatively quickly when you start to think about it. And so I'm just curious like how your current mental model is shaping up about how to think about the investable opportunity and the framework for an oracle like chain link, a DeFi protocol, a lending market, a DEX. How how are you thinking about heruristics

for valuing these protocols and assets in a future of hundreds and hundreds and thousands of different types of tokenized assets on chain to the tune of trillions of dollars on chain, right? I think a lot of our mental models will be shattered in terms of sheer scale. How do you how do you reconcile thinking about where the industry currently is, where we're probably going in about 5 to 10 years on chain and how to kind of like value these things? >> Yeah, I think the market historically has been very biased and honestly still is biased towards the fat protocol thesis that the L1 blockchain because it's the base layer is going to capture all the value. We can see that just by the insane price sales ratio of pretty

much every L1 compared to how much value it captures today and just the relative like I mentioned every coin in the top 50 is basically a blockchain for the most part. So the market thinks that that's going to be the central area that acrews value. But I think Ethereum is a bit of a warning story that that's not really the case. Ethereum at one point was the cash cow making billions a month and not so much anymore. Now who makes all the revenue? it's the apps and it's the vertically integrated chains. You know, it's the pump fund and the hyperl liquid as well as the asset issuers like stable coins, uh, tether is an obvious story there. So, I think it's clear that the idea that everything would acrue to this base layer just isn't really the case. You need to be able to control the

economic flow and you need to control the users. So, like anything that's able to capture me has done relatively well. So, you know, chain like has chain like SVR for capturing MEV revenue in in that sense and being able to work directly with the client. You know, something that's trying to be a credibly neutral generalized anyone building mechain can't really set up enterprise revshare deals, right? Like if if lighter is building on Ethereum, that's fantastic. There's no rev share between Lighter and Ethereum. Lighter pays a little bit in DA and proof verification and that's all Ethereum gets and Lighter keeps all the revenue for itself, right? Whereas with chain link, because it has this organization associated with it, it can go to Swift, it can go to whoever and establish a revshare deal in sustainable economics that that work like you know there's deals between chain link and GMX

that are like are revshare deals. So like there's you have to be agile when it comes to the economics and I think it's becoming increasingly clear that uh the apps and the frontends that control the user flow is capturing more of the value because they have the leverage and the middleware infrastructure that's able to abstract away the increasingly commoditized blockchain ecosystem is also set to benefit as well. So that's not a super popular view. At least I don't think it's popular because look at look at the market valuation of all these L1 gas coins on the market. But I think the market's increasingly recognizing that uh you can be an L1 and succeed, but you can't just be a generalized smart contract chain. You need to have your own native per deck that has trading fees. You need to have your own stable coin that has interest

on reserves revenue. You need to have revshare deals with your interfaces. I mean, look at Hyperlquid's builder codes. was genius of a distribution strategy and they've made them and their partners a lot of money through that strategy. So I think the market's starting to wake up that you can't be passive on the economics. You need to actively aggressively either capture the user and or establish revshare deals with the uh apps that have the the user capture. And I think that's that's something that as more and more assets come on chain tokenized funds commodities securities natively issued securities come on chain it's not going to be any different. you know the the venues that people are trading on, the apps that people are using, the middleware infrastructure the institutions use to connect to 100 chains um easily like that's the infrastructure that is able to acrue

value and then the the next commoditized L1 EVM fork like I just don't understand why that still gets funded >> in this market besides retail or VC wanting to sell tokens on retail but why is retail buying this tokens? I think that they're going to be the last ones to catch up but I think the next marginal buyer understands that this this is shifting. >> Yeah. Yeah, I mean I mean we've seen that just in the market performance like Zcash is getting a bit. It's like this private store of value. So there's clearly like this like there's still like a appetite for like this like store of value, no utility other than just like reflexivity. Um and then obviously Hyperlid and then some like AI stuff, right? But, you know, I think David Hoffman just crashed out and like sold all of his ETH, he said. And then like

Banklist had like some weird like I don't know. I don't know what happened with the company, but some like weird like dis like dichotomy of opinions between them two, I think. Maybe you could say. Um, and a lot of people are just like nuking on ETH as well in general. I I hold some ETH, not really a lot. Um, I I don't know. like Santiago Santos is on Empire again today saying that 255 billion is like way overvalued for this thing and now you're telling me that you know your view on a lot of these L1s is like you know they're commoditized or they're commoditizable and they need perexes they need stable coins they need revenue etc. Has your view on Ethereum changed and has your view on ETH the asset changed? Yeah, I

mean I I used to be definitely a bit of an ETH maxi in the past. What really sold me, and I'm not ashamed to say this, was the ultrasound money story. The idea that Ethereum would be adopted and that would lead to revenue and directly lead to a deflationary native coin was a story that just made sense because it directly connected adoption to token value cruel in a very direct way. But now that Ethereum's revenue fell off a cliff by like 99.9% because they uh shot themselves in the foot. They took the most valuable part of the stack which was me contention fees and congestion fees and forfeited that to all the L2s to capture and then focused on the least monetizable part of the stack which is data availability and settlement that like they kind of shot themselves in the foot in that regard.

So that ultrasound money narrative completely died. And at this point I I've talked to quite a few like Ethereum people and the pitch is essentially well as the Ethereum blockchain gets more adopted ETH is going to be used as a store value in DeFi. like that's a given assumption which it maybe it will maybe it won't I don't think that's necessarily a given assumption that ETH will be a store of value that people will use particularly as more and more tokenized assets come on chain those markets are denominated in stable coins and tokenized deposits no one's using ETH you know hyperl doesn't use ETH as the currency uses USDC same with lighter lighter uses USDC they don't use ETH in any way not as a store of value and barely as a revenue generating asset like it's so the stories just kind of change for Ethereum

I think that the way that Ethereum can make up for it is either it's able to scapse people into believing it's money in the same way as Bitcoin which you know look at Zcash has done a fantastic job of doing that. It's not an unviable path or it's scaling the L1 aggressively and generating fee revenue through volume like just immense immense amount of volume but it's kind of in this weird path where like it's trying to scale the L1 but it's just not where these other new generation chains are. It's trying to be a store of value but it's just being dominated by stable coins instead. It's kind of just like this identity crisis mode that And then the EF I mean I I don't know what's going on.

>> What's going on there, man? >> I wish I had left. >> Yeah. I don't I don't know what's going on there. Like they brought on Tomas. I thought things were going well. >> Same. >> Him and a lot of other people left and now it's back to the idealism that's been running the EF for a very long time. I just I don't know. I I was starting to get bullish when Tomas came in and the whole, you know, focus on pragmatic adoption and build what users need and now it's back to what they were doing for the past few years. And so I don't know what's going on there. It's like I and I don't think what's happening with Ethereum is necessarily unique to Ethereum. I think this actually applies to a lot of other L1's. The difference is that Ethereum is worth $200 billion. So like it's it's

going to be held to a very high standard. It's the same reason I talk about XRP, not because I really care, it's because it's worth so much relative to what I think the fundamentals are. like there's there's a long trail of L1s that have problems way worse than Ethereum. It's just that they're valued >> relatively speaking to to reflect that. So, it's I think that uh there's like a changing of guard happening in the industry. There is, man. And honestly, it feels like uh I mean I'm obviously bag biased here, but it feels like hype Zcash are kind of like part of that in a big way. Like we're making a ton of money on one side and you know this entire industry was built for trading.

here's a great trading platform. We make a ton of money. Arthur Hayes was on the show yesterday. He's obviously, you know, left, right, and center with his takes. But he was like, "Look, like I was an exchange owner. Exchanges make money. We know this. Like we know this is something that makes money. Uh things valued at depends on like the market caps or how you look at it. But um and then you got something like Zcash which is just like privacy Bitcoin, you know, getting to be quantum resistant. And so I don't know, it's just like weird that I find it interesting that the that the rhetoric right now is around only a couple assets and also it feels like everyone's just forgotten about the old

guard of L of the L1's and L2s. Um, I don't know. It's like healing in a way, but also like depressing in a way because a lot of these teams are still going to just keep building and working. But, uh, the market can be so cruel in the way of like new asset, good asset, like new trend, new narrative, good narrative, good trend. And there's just been such an explosion of in of assets. And consolidation is just the only way that makes sense in the industry going forward. And that's going to be a bit of a brutal reality for a lot of the industry.

>> Yeah, I I think the pendulum has pendulum always just swings from tokens are amazing, we need a million tokens to tokens are useless, we don't need any tokens and like we're kind of in the maybe a few tokens. And I think we'll kind of swing back, but I I think that bifurcation of your your your project needs to have fundamental value to be taken seriously by the next marginal buyer. I don't think that dynamic is going away. And I think it's healthy cuz some of the biggest issues with crypto in the past is that garbage was funded with billions of dollars for years and there was no incentive to build useful things. If you could just launch a project, sell a token and then do it again 10 times over. Like there's no reason to build anything real. And the projects that were building something

real like I think Jane is kind of gets ignored on the by the way side because it's not the big new shiny thing anymore. It's just building financial infrastructure which is >> going to come back that that pendulum's going to swing back. I think as well. >> I think so. I don't I don't think it's going to be like 2021 where everything just goes mayhem. Maybe seems very unlikely, but I think the idea that it's only like two coins that are going to succeed. I think it's going to be a little bit more than that. And and it should be for industry successful. We need more than just a trading deck and a privacy coin. Like we need >> there's a whole many whole lot of other use cases we could do with blockchains.

Uh you know, you need you need things to trade on Hyperlid that have value. So, I I I think it's kind of just one of those temporary uh reflexivity of hypervatile crypto dynamic. You know, it's four year four year cycle stuff. >> Zack, thanks for your time, man. Have a great long weekend. Um sure, it's going to be a nice little break. Um we'll see what happens over the weekend. I'm sure there's going to be some antics. There always are. And pleasure to have you on. >> Appreciate it. Thank you, Andy. >> Cheers, Zach. All right, buddy. Man, Chandling just continues to get into the right spot at the right moment and continues to just get where institutions are going to be placed in

the right spot at the right time. As I was saying with with like the path dependency side of things, it's really how this industry works. You get very path dependent outcomes based on events that are far out of your control and you're either on the right side or the wrong side of history. Um, pulling up the chat here. Greetings from Bulgaria. Plume belongs in the top 10. What's up, Christian? Feels like another example of unis swap. New type. I don't know if they're on the IR page. Um, didn't like that answer as much. I had to ask that for you though. New type. Guys, if you're on YouTube, I'm watching the chat. I will ask your questions. We've got ya and and fig from superstate. A is the co-founder and CEO of August digital

powering upshift [snorts] and our lovely friend fig is a core core personnel from the uh superstate team and they have just launched a new product called upshift clear. It is instant redemptions for money market funds. I used money market funds this year for the first time in my life [snorts] after selling a lot of crypto in 2025. And I learned this year that it does indeed take plus one settlement to get out of a money market fund. And that was an annoying learning. So we're going to talk to ya and fig. Guys, welcome to the show. Good to have you. Welcome to the rollup.

>> Andy, thanks for having us. Thanks for having us. It's good to be here. >> Yes. Did you guys hear that little um analog there of my money market story as a fully onchain investor for six years trying out a brokerage account? Terrible. Absolutely awful. >> I'm glad you sold at the right time. One of us did something right. >> I was going to say you're holding hype though. >> Yes. Yes, of course. Of course. Been bullish for a while. Good to have you guys. I It's good to have you back fig. First time on the show, man. would love to hear a little bit about yourself before we get into this. Uh what do you do at Super State? And uh does Jim ever dunk on you in basketball practice or No.

>> No. I I don't dare step on the court with him. I I wouldn't let that happen, but I'm sure he could. Uh great to be here. Thanks for having us, guys. I am on the business development team at Superstate leading our protocol relationships and and working with great partners like Upshift. So, been there for a little bit, been around the crypto world, tons of different types of crypto companies, and excited to be at Superstate and working with Upshift. >> Yeah. Beautiful. Well, I I think last time you were on the show must have been four to six months ago or so. We were talking about kind of this tokenization growth and how Upshift was really positioning for that. But let's just get caught up on your side. What has Upshift been up to the last four to six months?

I know obviously this kind of tokenization wave, if you will, has significantly increased in terms of things actually happening as well as attention. How have you been capitalizing on this? Catch us up until the clear announcement. >> Yeah, so uh again, thanks for having me. Great to be back. Uh I would say at a high level, vaultification still very much here and it's for all different types of products and it really is a capital raising initiative. And so why we're super excited about Superate is if you look at I think it's no secret you mentioned you sold all your crypto you know back in 2025 DeFi more broadly TVL is down roughly 30% year to date but RWA TVL is up 50% roughly and so if you think about where capital is going you

know it is going into those money markets it is going into more institutionalized products and RWAS in whatever facet but to your point you know it's really really painful to have T+1 T plus 3 and So, how do you really create that flywheel with the 247 market by having the instant redemptions by allowing for, you know, seamless accessible liquidity both in and out? And this is one step in that direction. >> Beautiful. All right. Um, USCC has been growing significantly, FIG, and you guys have done a good job. Why why does this make sense? Why is this kind of unlock with upshift clear? What does this provide to superstate customers, clients and kind of how do you think about this

evolution of the seamlessness of these RWA products on chain? The core benefits there obviously being you know 24/7 instant redemptions which we now have. How do you kind of think about this at large? >> Yeah. Uh USC has been phenomenal this year in terms of growth and it's been a really interesting product. Uh that's interesting about clear and why it's important for USC is it typically takes T+1 market days to get out of USC. So if you redeem on u Thursday at 4 p.m.

you're getting your cash back on Friday morning. Upshift clear is a great sort of use case for weekend liquidity and afterhour liquidity. I think it gives investors a lot of comfort of when they can use these RWAs, what sort of applications they can use this these RWAs knowing that there's liquidity 247 uh behind the scenes ready to be used in a in a protocol like upshift. So, uh we've got a ton of really interesting clients. Uh Bitwise is actually coming on as the asset manager for USC. That's new news, which is awesome. And Upshift is giving investors and and future investors a lot of comfort of how they can use this product and how quickly

they can go back to cash. >> Love it. And then I could you just break down how this Clear Vault works from USDC deposits into the instant redemption functions. How exactly does this work? >> Yeah, absolutely. So, um, you know, behind the scenes, this is the first time that we've launched our atomic redemption vault. And so what happens is we have a number of different LPs. We've raised now interest in over hund00 million of LPs that are comfortable and willing to underwrite a number of these RWAS. We're starting with USC but it looking to expand across a number of different superstate current and future products as well. Uh and so really what happens is there's two sides of the market. There is a market from the LPS.

They deposit into the vault. They lend their liquidity that uh they get the receipt token on the other side. the liquidity goes into safe yielding assets with instant liquidity capabilities and whenever on the other side a redemption comes in um that atomic vault will essentially atomically withdraw the funds redeem plus fee the redemption request and then the LP itself in terms of the RWA will then be manually processed through a redemption cycle with superstate directly. Um, and so obviously, you know, that's a first step for us to making this fully atomic across both sides. Um, and also to support a number of different RWAs. Like I said, we're super excited about the different tokenization um, mechanisms

that Superstate has both for the products they have today, but also there's so much interest in, you know, expanding the RWA footprint um, more broadly and to tokenize more existing assets and bring them into this 247 ecosystem. So, we're very very excited about expanding, you know, what this uh instant redemption vehicle can support. >> And then somebody has to, you mentioned through Superstate there's kind of the reserve management here. Somebody has to take the the the actual assets into a money market fund and then also process the redemption there. you know, given that these things may happen on a long weekend like, you know, this weekend here, how how do you guys compensate the

LP or the or the holder of this product? Um, right. So, let's say I go and, you know, Friday at 4:45 p.m. I'm like smacking the exit. I get my 100K out of this product instantly. the LP of that money market fund of that 100k theoretically wouldn't be able to pull that out of a brokerage even until like Tuesday and then they would not be able to get those funds until like Wednesday or Thursday. How do you reconcile the difference of time uh and the yield that is like lost or generated because the product is still in that fund but the user's already pulled their funds out. How does the reserve management work?

>> Yeah, it's a great question. So, if you're looking at, for example, overnight, then I would say average market both demand um in terms of what people are willing to pay and looking to get paid is around two bips. Uh if you're looking for some of these larger weekend plus holiday uh timelines, I would say it's closer to five bips. Uh and so the goal is obviously to make that pretty dynamic. I think on average it's closer to three bips just based on the volume that goes through and then the time at which it's requested. Um now again that can you know extend to be more dynamic over time um depending on the duration. Right now the duration that we're looking at is really just t plus one and then weekend.

Great question. So that fee is currently paid by whoever is looking to instantly redeem. So, you know, that also has to make sense on the other side in terms of what someone's willing to pay in order to, you know, get that 24/7 liquidity. Uh, you know, that I there's always a wide spectrum of how price sensitive someone is. Um, and there's always the long tale of when people want to get out most, it's typically, you know, uh, market cycle or black swan event and they're looking to rebalance and they're, you know, maybe willing to pay more than in a market like today. And so I think that price scenario is very dynamic but currently really just keeping it within the 2 to five BIP range depending on the time at which someone's looking to redeem. Uh and you know again just for the T+1 T plus3 but

that that's exactly right. We basically are just the vault infrastructure provider. You have the LP that's getting paid the fee on the other side. They're taking on duration risk and then the redeemer who is looking to get that instant liquidity. and and fig are you seeing real demand from superstate USCCC you know clients and customers and holders for this and you know who who are those archetypes of of you know people or firms that actually you know care to have something like this >> yeah there's a lot of variety in USC clients we see stable coin uh providers issuers who are looking for yield behind the scenes we see DeFi native hedge funds that are looking to enter into the

the carry trade themselves and and don't want to trade it. Uh we also see high net worth individuals who are pretty active in their DeFi positions and and actually using RWAS. I think that second and and last bucket are perfect examples of users for this product. People that want to move positions as they see new opportunities come uh come on chain, people that are rebalancing for market opportunities or just changing market conditions. So just getting started and we're excited to have Upshift as a partner.

>> Yeah. And then F, do you think that this is going to be possible for other products in Superstates kind of repertoire? Like I know that there's a USD USTB or US >> Yeah. USB is our treasury bill fund. That was our flagship uh money market fund which we launched over two years ago. Uh it's been really fortunate to have a really liquid product there. But we've launched a new product line called fund to us that's allowing existing asset managers to bring their funds on chain and for us to tokenize them using our technology and a lot of these asset managers that don't have the same T+1 or T plus0 liquidity and I think this is a a great use case for upshift clear is

enabling investors to take on new exposure on chain holding it in familiar infrastructure but having the peace of mind that they can get out when they need it. >> Yeah. I anything to add there as far as like other potential types of products that could be useful in a vault structure like upshift clear with instant instant uh redemptions. >> Look, I think uh at the end of the day, there's a price that someone's willing to pay to take on duration risk of any asset. And so it may not necessarily all live in the same vault or subset. I think you know what we've seen is obviously you know USC is a different type of risk profile than some of these

tokenized fund structures um and underwriting those really depends on the risk and pricing it also depends on on different risk and so I think that we'll probably see a subset of different risk profiles for different duration um you've seen 90-day duration we've seen six month duration uh and there's always a price that someone's willing to pay to put that on their books but it is really exciting to see that come on chain because historically in order for you to be able to, you know, get instantly in and out, you would probably have to OTC this with um for some of these more complex products, you'd have to OTC it with a prime desk. You'd have to be onboarded there. You, you know, wouldn't have great price discovery. Slippage would be crazy. You know, um you'd probably pay enormous amount of fees just because, again, you're desperate to

get in and out of a situation like that. And so bringing that on chain is going to hopefully one make it a lot more transparent, two hopefully make it cheaper um and three enable you to get access to the 247 uh credit market which for example morphone a supply and the only way for you to do that is to have you know collateral that you can actually liquidate as a secondary price for. So I think we're super excited about this. Um, and then there's a lot going on, you know, on some of the the more interesting pieces um for price discovery where it's um, you know, we talk about like ETFs, we're talking about, um, commodities, uh, pre like IPO products. I mean, there's a lot of interest in some of these RWAs and tokenizing them and bringing them on

chain. Superstate is leading a lot of that that charge. And so, yeah, we're we're super excited to see how we can plug in that liquidity venue within these different products to make them more accessible and usable on chain. Love it. Last thing about the product and then I want to talk more broadly here. Question from uh one of the listeners. Is is USC a product that's open to anyone? KYC accredited investors only. What are the requirements to be able to participate in this vault with USCC? >> Good question. That guy's doing my job for me. So, thank you for asking the right questions. Uh USCCC is a private fund. It's only available for qualified purchasers. So investors with more than $25 million in assets and above. So

that's USC today. We've got more coming in the fundos pipeline. Just announced a fund with Coinbase asset management called Kushi. That's a stable coin lending uh mandate and we're excited to bring more on. Beautiful. So guys, I had um Carl from Sixman Ventures on I think it was on Tuesday following this innovation exemption potential rumor from the SEC talking about the rules for tokenized equity specifically. And I think the core the crux of it was essentially you have to have um the dividend rights, shareholder rights, voting rights, full kind of rights that a typical stock or equity would have offchain onchain to be able to

potentially offer these on trading platforms or venues. And the other kind of big thing was you can tokenize equities without direct permission from the issuer themselves. So third party issuers can kind of tokenize these equities. And so we had this conversation about the different types of models native versus wrapped uh uh equities and kind of like how this works. And through this we kind of came up with this tokenization barbell which is like often a word that is used in crypto investing. and we came to the idea that there was like these very highly useful parts of the tokenization stack and they're kind of on the opposite ends of the risk curve and of

like the liquidity curve. And so on one side you've got tokenized deposits, stable coins, products like T bills and money market funds. And then on the other side you've got equities and kind of like very liquid tradable products. And in the middle where it's not so likely to have a lot of value were things like venture capital, real estate or these types of kind of like more illquid mark tomarket once a quarter twice a year types of assets. And so that was kind of like the framework that was laid out by Carl. And I'm curious how you guys are thinking about this to this tokenization evolution. we've thought about it, Rob and I on the show is we started with like the most high

quality non-speculative assets, tokenized deposits and stable coins obviously grew massive and then T bills money markets and now we're getting into equities and and other products. So, we're kind of think of it as like an evolution, but as far as like the value proposition of tokenization itself, do you guys align with this spectrum concept? How do you how do you both think about where tokenization actually provides real value to a given set of assets? you can probably take a stab first. >> Yeah. So, um, first off, major shout out to, uh, Carl from Sixman. We love him.

Uh, and, uh, I would say Fig is probably the expert on this, but I I actually will push back on the barbell and frame it a little bit differently. I think it depends on who, uh, what perspective you're looking at it from. Are you looking at it from the asset issuer or are you looking at it from the user who gets access to these products? From the asset issuer perspective, the best piece of feedback that I've received is actually the barbell is as it pertains to opex and cost. And so if you look on one side, you have money markets and then if you look at the other side, you have um you have uh private credit. And that's because uh those two things are either where you can have cost savings.

Um but the in between of like ETFs, index funds, these are products are almost today offered at cost. And so there's no real OBback savings that you would have by bringing them onchain. And so um you know when you're looking to make a difference at least internally at these very large organizations, you're trying to save some sort of operating cost. That's the convincing factor of bringing these onchain in addition to net new markets that you're selling into. So that is kind of the barbell for the asset issuer. Now I agree with you in terms of the barbell for the user themselves, right? At what point did the tokenization really help? And so um in my view, you know, I think one of the things that we're seeing a lot of demand for is directional underlying exposure to these assets. And so, you know, as

you talk about how do we bring tokenized equities on chain, how do we bring more commodities on chain, but also indexes and ETFs, we're not recreating the wheel here. Folks just want a basket of goods. They do not want to make the decisions on how those baskets are rebalanced and made. And the issue is, you know, again, that's what the user wants. But the asset issuers here saying, well, you know, it already doesn't cost me anything to to put this in the traditional market sense. Why bring it on chain, especially when the regulatory overhead is going to be so expensive? And so, I do think that, you know, at least from the, you know, user that is looking to get access to these these assets, I agree with you on that barbell. Um, and it really just pertains to like then once it's on chain, what do

you do with it? And so you how do you make it composable with the rest of your portfolio? I will say like one thing that I think is we're going to see a lot more of is, you know, if you look at just what happened with the preipo tokens, um, Cerebrus was one that, you know, saw significant liquidity on Hyperlid. And what was so crazy um was that uh I believe the preIPO price on Hyperlid was roughly 6% away from the actual IPO price. And so people were able to express an opinion prior to it hitting the IPO price and that is what people want access to. And so then how do you make that composable with the rest of your portfolio? People are going to move to where the 247 market is where can they can express opinions. So I

think at some point we meet halfway but is definitely going to come on chain because that is just where the liquidity exists for you to trade 247 and you know if hyperlquid and tradeex I would see are an example of that. That's where the liquidity exists today. >> Yeah, F. >> Yeah, well said. I I think a lot of people are looking towards crypto capital markets and they're seeing $320 billion of stable coins to compete for and I think that's a really exciting opportunity. A lot of the products that I I've seen personally that came on were a a result of market demand. Treasuries for stable coins. Uh commodities after gold and silver running up. I think equities right now because there's actual interesting companies going

public and and and creating innovation in public markets. So will be interesting to see where we go next and it's really exciting. >> Yeah. I mean I agree with both. I think that there's different ways to approach where the value is, who is actually getting that value from the different perspectives. Um, and kind of the general kind of mental model that I think is being shattered in the space right now is that we're building this entire industry for just the hundred billion dollars onchain of crypto assets and the $3 trillion of the market cap that exists. I think that entire notion is being shattered into well know. I mean, we're going to have tokenized versions of dozens and dozens and hundreds of assets on chain from

non-speculative to speculative. And the total kind of TAM here is starting to look more a lot like chipping away at bits of global finance rather than just kind of this little crypto ecosystem that we've built over the last, you know, 101 15 years. So, Fig, I you guys are fighting the good fight. Appreciate you guys joining. Have a great long weekend. I'm sure you guys will have some nice time away from screens hopefully. and uh thanks for coming on. >> Thank you for having us. >> Happy Memorial Day. >> Yeah, happy Memorial Day. Thanks, guys. All righty, ladies and gentlemen. We've got the institutional segment. We've got Christopher Perkins, a US Marine veteran, foreman, former banker now

leading Franklin Crypto, also a big fan of the show that he runs on Unchanged. We're going to get him set up here in the tokenization tower and we'll be right back. Don't go anywhere. This one will be great. [music] [music] [music] >> [music] [music]

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tokenization tower. I'm here with Chris Perkins, future head of Franklin Crypto after the re the recent acquisition news. Chris, welcome to the tower. Great to have you, man. >> Thanks, Andy. Thrilled to be on, man. >> How about those Hyperlid ETFs? Those those caught a lot of people off guard. >> Yeah. I mean, congratulations to the issuers. Um, Hyperlid is doing awesome. >> Yeah. >> And, um, what they've really done is they've come real out of nowhere. They've been around for a while for crypto natives, but what they've done is they've come on to the mainstream um, set. And why is because 247 markets.

Yeah. Like crypto data is like us. That's what we do. Uh we operate 24/7 markets. Now I think Tradfi is realizing uh oh if I don't have 247 I'm obsolete. >> Yeah. >> And um been talking about this like I'm an old futures guy. >> And you know ever hear about the bun futures? >> Okay. >> So there's this famous contract it's called bun futures. traded in the life exchange and you know all these sweaty guys were raising their hands and trading in the pits and then Urex developed electronic markets and then all of a sudden one night one day everybody woke up and all the liquidity moved >> and so in traditional markets right now I think there's a lot of fear because they look at what happened and and really this is like you saw the news about CME and ICE you know raising

concerns to regulators this heart to people in the derivative space because they've seen this happen already and 24/7 is table stakes Now it's the new electronification and if you don't have a solution, you got problems. Um and then but look what's happening. Like CME is hasing this partnership with Google. ICE is now they went long. They they invested in Poly Market. They had this deal with um OKX. That's looks like it's going pretty well. So I mean it's like an arms race right now. But uh hats off to the Hyperlid guys. Um they've been doing great. >> And to Bitwise, right, in 21 shares. I mean it feels like all the other issuers just kind of missed the missed the ball here. Yeah, it's still early. I think um you know ETFs are a rapper um in a way

like tokens and what makes me crazy is people have been going around saying I don't think there's any value in tokens. >> Um that's just like saying there's no value in ETFs, right? It's not about the ETF rapper, it's about what's underneath, right? And so I I think we're still early in ETFs. I think you're going to see, you know, as traditional finance and crypto come together, conversions. You're going to see all types of new interesting products, seeing the first concepts around like prediction market ETFs, you're also going to see um I mean, god, so many different innovations. I mean, you're going to have crypto native products that have ETFs that become crypto again or tokenized. And so, like, we're at the beginning, right? We're at the totally we're at the beginning of this thing, not the middle or the end.

And you know, yes, I think in crypto now, retail sentiment's all terrible and people are rage quitting, whatever. Retail comes, retail goes, but those institutions, they're marching forward. Uh, and they bring a lot of capital, a lot of weight. Doesn't happen overnight, but but it's happening. >> Yeah. And I mean, it's it's also just kind of setting a new guard, right? Like people have been bullish on Hyperlid for a while. I mean, they've been bullish on Bitcoin and majors for a while, but out of nowhere, you've got like Arthur Hayes saying hyperlquid Zcash near. You've got like, you know, David Hoffman sells all of his ETH and people are like up in shambles about it. They don't know how to react to it.

>> There's like this weird h how do you kind of reason about this changing of guard? Because on one on one side you've got, >> you know, fundamentals, revenue, you know, buybacks, you know, people want real value, and then on on the other hand, the kind of privacy stuff happening feels like a returning to the fundamentals of the industry of kind of like why we're here. >> Yeah. >> And it seems like we we we lost both of those over the last couple years. And so it's like a a natural like reverb back to where we maybe should be. Like what's happening? >> I tweeted about this yesterday. I took a little bit of flack, not too much, but what I said essentially was that in certain cases, the frontier is being settled.

>> And when you look at the frontiersmen and women, the early adopters, people like you and me that have been in for years and years, they want a certain sugar rush, right? They want to take that risk when, you know, regulation is is against them and they're they're like fighting the good fight. That's what really gets them going. And frankly, if you can operate in those environments and you're on the river, um there's a ton of opportunity, a ton of upside, it's a different risk profile. >> Yeah. >> And so I think for some of the more more mature assets right now, like Ethereum's been around for for over 10 years, that's one of the real reasons why it's appealing to the boring institutions because when I was in Tradfi, I needed 10 years of risk. Yeah.

>> And so for some folks, they're like, well, I want something that's like cutting edge and edgy. Is privacy edgy right now? Absolutely. Definitely. >> You know, how many exchanges banned it last cycle because you're afraid about going to jail? I mean, even if you develop this stuff, right? So, they're looking for that next frontier >> and that's an amazing place to operate. But I I you know, and when I step back and I look at Ethereum, I'm like, "Wow, what's its big moat? What's it differentiation?" Decentralization. >> Yeah. >> Right. It kind of is crops. And so if the EF is espousing ideals as a nonprofit, okay, that's what nonprofits are supposed to do. Yeah.

>> Like let let Joseph Chalum, let Tom Lee go out and do the BD. Um but I I think a lot of it has to do with like, >> you know, and and yes, price action is always a challenge, but price action, you know, is really down to like one reason, you know, why the prices are where they are. Has to do with the number of buyers and sellers, right? You need buyers, the things going to go up. Why aren't there buyers? Well, like there's a few things going on. I think retail's pulled back some of the buyers that old buyers have sold. They're like, I want to go on to fresh pastures, new excitement. >> Definitely, >> you've got the institutions marching. You got a lot of geopolitical pressure, you know, that's keeping risk assets down. But generally speaking, crypto is showing a lot of resiliency despite the

pressures, the the idea that rates may be going up, the fact that inflation may be going up. you know, look at the uh the Bitcoin gold chart lately and and since Iraqi Freedom kicked off, they're like, "Whoa, whoa, whoa. Why is Bitcoin holding up so well?" Well, because it has a little more utility than gold, maybe a lot more utility. It's more transferable. You know, bombs start hitting my country. If I've got gold there, maybe not a great thing. I can't really move it. Yeah. Um, and so what we're doing, you know, aside from those frontier assets that, you know, people are now maybe chasing for the rest of crypto, especially the older, it's about fundamentals to your point, cash flow, utility, regulatory certainty, and ultimately we're in a position now where sentiment's bad, fundamentals are

improving. Yes, we've got some geopolitical pressure, maybe some macro pressure. That stuff comes and goes. It's a really good place to be. >> Yeah. Yeah. I know. I mean, it's it is a great place to be. I feel like Ethereum still finds itself between a rock and a hard place. I saw Laura put out Herzsweet about Ethereum that definitely ruffled some feathers. Uh people obviously obviously um Mr. Hoffman ruffled some feathers. Um you know, influencers and like Ethereum's going to zero. Like where do we you know Santi said it's overvalued today again on on the Blockwork show.

Where do what is your stance on like Ethereum the network and then Ethereum the asset? Do do you have a particular view that you're expressing? >> Yeah, I'm not I don't like to put out price targets, but this is what I know. Bitcoin and Ethereum have done something very special and something that's really hard to do particularly in the context of clarity. >> Yeah. >> And they've truly decentralized. >> Yeah. >> Right. That is their edge. That is their moat. Blockchains are going to come along. to be fast and to be fast and to be fast and to be fast and to be fast and to be fast and to be fast and to be fast and to be fast and to be fast Heat. Heat. [music]

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we get we get deep we get deep we get [music] we get deep know we get >> [music] >> All righty, guys. We are back. A little audio hiccup there, but uh Chris, we were talking about Ethereum and just kind of like how you're thinking about the this asset class and also just generally like the framework going forward. I think uh another view outside of just Ethereum itself is kind of like thinking about the types of applications and products that are going to be you

know valued higher than others going forward. And I think there's like this common like apps versus infra concept and also like this fat protocol thesis being kind of like disproven. Um but yet we still sit with you know 90% of the top 25 tokens are L1's stable coins or some sort of like infrastructure. Um you know maybe Poly Market comes out and has a huge launch and it and a token launch and that does well. Maybe uh Hyperlquid kind of comes out even it's like a chain it's an app and it gets in the top five or top seven or something. But, you know, I'm curious if you're looking at any kind of broader like within the market itself trends to identify undervalued sectors or if if you're a believer in this kind of apps to outtake

the infraide given, you know, some of these L1s are still valued very very highly. How do you how do you kind of reconcile this? I >> I think you can find value across the stack. Um, clearly, you know, we found a lot of value in layer 1's. We've found a ton of value in infrastructure over the last few years because we were building something and so you need that foundation. Um we've seen a couple of really interesting apps over the years. I think now we're seeing you mentioned poly market with prediction markets. >> You're mentioning you know there's there's dexes, there's hyperlink, there's so you can find value everywhere. I think when you step back and you look at some of the major themes AI and crypto very important I'd also say start thinking about things like quantum and these are three technologies

that are absolutely correlated they're going to feed off each other um crypto is the democratization of finance in its purest form AI is the democratization of of information needs compute quantum is going to accelerate all these things and so I like looking at the intersection of these various technologies Um, crypto at its heart is a very financial technology. We're putting private property into the internet for the first time. >> Like when you step back and you think about that for real, you're like, "Oh, wow. That that's a big deal."

>> That's probably why New York is the crypto capital of the world because this is where global finance is. So, you're going to see an incredible amount of innovation um and application like repo markets, things that just haven't really been cracked yet. Uncolateralized lending. Um, I'm a huge believer in fixed income markets and so, you know, I spent a career in there. Um, interest rates, interest rate swaps, that's the largest >> largest notional product in the world, like$500 trillion dollars, almost nothing in crypto. Um, and so there's just there's so we're not too late to the party. Um, there's so much going on.

I think those three those three verticals I talked about are going to accelerate each other. Um, and I'm excited. Have you tried um the Venice chat product yet? >> Yes. Yeah, Venice is very cool. >> I I typed in like, "Hey, is this really private?" And it was like, "Yeah, this is private private inference." And I responded. I was like, "That's bass, man." [laughter] >> And then I wrote back like, "Yeah, it's pretty cool, isn't it?" >> Yeah. Like things like robotics, too. Like, >> yeah, >> you know, I know so many adventure guys who are like, "Oh, drones, forget it. Oh, robotics, forget it." And then all of a sudden overnight, it's like, "Whoa, it's the hottest new thing, right?" So you can't just like sleep on any of these verticals. You got to keep an open mind >> on the venture side. It's always about

founders like >> founders who are trying to solve problems and break walls. Like that's what you're on the lookout for. >> Yeah. So I've got a decent sized position in PER right now. The DAT for Hyperlid. And over the last like sixish months, it's outperformed by like 70 to 80% of the spot price. As of late, it's actually underperformed the last like 3 4 days. And I think they're hitting the ATM selling shares to buy more hype. You know, this was kind of like the original DAT and like idea. And it kind of fell by the wayside throughout the last 6 months because this has just not been possible, not even for Sailor himself.

So that's why Stretch came about because he needed, you know, more ways to raise capital. Um, I'm curious if you have a right way to think about for people who are looking at hyperlquid right now or, you know, Zcash or Bitcoin or whatever it is. How how do you think about buying like a micro strategy or a per or a cipher punk technologies versus Bitcoin, Zcash or Hype? How do you like allocate accordingly? And like what are the core differences to understand? >> It's way too early to leave DATs for the dead.

>> Okay. And we saw like many things in finance uh things get um you have bubbles. You have everybody racing to take advantage of a new idea. Um there's bubbles and and what you're left with are there's going to be some amazing DATs that are very very successful. And because when you step back and you think about the thesis behind a DAT, what are you doing? Well, it's it's kind of similar to an ETF in a way because you're wrapping a security. And by wrapping something as a security, it makes it easy for anyone in the US and in certain cases the world to access it.

It's very operationally simple. I go into my brokerage account and I and and and I buy the thing and it just I don't have to worry about anything else and everything else goes away. There's a lot of value in that wrapper and then like an ETF or a token, what matters? What matters is underneath. Yeah. So, if they're acquiring a token, well, you want to make sure that that token has good fundamentals. You want to see alignment with the foundation. In many cases, it helps to have a K, key opinion leader, someone who's able to explain to the general populace why it makes sense.

Um, and you know, we're seeing a lot of these stats. They're not just investing in the in the underlying native token. They're investing in the ecosystem. And like I kind of see a world where they become the labs of that ecosystem. They are the BD arms, right? Because they're the ones who are planting the seeds across that ecosystem to make it grow. >> And so like again, you have to do research. You have to understand the fundamentals behind. Um but it's a ve I think it's a fascinating innovation and I think for the right folks, the right underwrites, I still think there's a lot of upside for the right. But of course, like, you know, like everything else we've seen, 90% of them are probably not going to work out. We're already seeing that happen.

>> But there's some that are really I don't think they're going anywhere. Let's just say. >> Yeah. But like I personally wouldn't want Perr to be doing anything but buying hype. Like stake it, buy hype it, stake it, you know? Like I don't like I know Tom Lee has gone out and bought, you know, some stake in Mr. Beast Company and like has like these moonshots and things and >> that's amazing. But um the only reason that I own a purr is just because it's the capital that's in my brokerage account is just like it's just like an easy >> it's easy, right? It's much easier than figuring out how to buy hype directly. >> But it also is >> and in certain ways it's cheaper, right?

The transaction costs are cheaper than paying through your nose on a on a a cryptonative exchange. >> Well, that's the thing like Robin Hood or any or Coinbase or anything, you get wrecked on fees and then obviously you just trade on on Hype, which >> here's the good news. Um those fees, I think, are going to go to zero >> across all the all the centralized exchanges. Oh yeah, >> cuz they're bad. They're really bad. >> So, the one thing I've learned over the years in markets is that spot prices go to zero. Uh spot fees go to zero. >> Um that's just what we've seen in equities. Why wouldn't it be the same in crypto? I I mean, look what's going on in ETFs right now with like Morgan Stanley.

>> Um even um who was it who came out with a platform recently like fees are going to go to zero. I think it was Schwab cut like fees in half from Coinbase. And so the one thing I've learned in markets after all these years is that spot trading exchanges really hard business. All the money's in derivatives. >> Yeah. >> And that's why hype is really interesting. That is the prize. Did you know that you know NY right? >> Of course >> it was bought by ICE. >> ICE is one of the largest derivatives players in the world. >> NI didn't buy ICE. Ice bought Nazi but everyone like talks about NY because it's like so storied, right?

>> Money's in derivatives. Don't forget, >> right? Yeah. Yeah. Interesting. So let's talk about Franklin crypto. What the initiatives are going to be there. Obviously this is the institutional era of digital assets. I mean it's very firm and clear if you're not, you know, adapting to this world, you're going to die. Like this is the state of affairs even to the extent that most kind of L1s and teams and blockchains are really focusing on this. And then you've kind of got a cohort of like base and mega ETH and companies others that are just like, you know, we don't even care about any of that. we're just going to just do fully onchain DGEN consumer experiences, but the bifurcation is very real. Um, >> what what does this mean for your role at Franklin Crypto and their role in this ecosystem?

>> Yeah. So, I don't know if it's that bifurcated to be honest. I mean, >> I did many years in in cryp in uh in Trafi, right? Built a bunch of businesses and then I went full-time crypto for almost five years with my partner Seth. He's been, you know, he's a little longer than me and the team. And so like we're bringing to the table like deep cryptonative experience like you know we've messed around and learned about every single failed consumer project like we we've been in the trenches for the last 5 years. Um and so I think we've learned a lot through navigating you know the thing in crypto is the highs are high and the lows are low and we've been through all those cycles. We also learned how to operate in 247 markets.

>> Yeah. And that's a rewiring that we had to undertake to be successful in the crypto space. And so we're bringing over uh to Franklin like very very native expertise. But let me tell you about Franklin. Jenny Johnson um you know she's the CEO of Franklin Templeton. She came up to through the tech ranks and she grabbed onto this technology very very early. They launched their uh their initiative in 2018. So it's not like they're new to the party. And what I've noticed is like the the vision, the the ideas, the ideals, it's all there and it's perfectly aligned with where we're coming from from being, you know, just cryptonative and they built this

incredible foundation. Um Sandy call over there actually sat next to her at city for years and years. I think we got into crypto together like 2013. She's a really good friend of mine. Um, so we're coming across with this amazing foundation and we're here to just scale scale scale build build and it it's interesting, you know, it's such an important time because Franklin has clients all over the world. >> Sure. >> And they know that they need to get into this space. You know, a couple years ago, they had risk for being in here. We took the risk. We operated and we survived and maybe we thrived a little bit. But now they've got risk if they don't have a solution. And my job is to bring that together. Um, last thing I'll

tell you is that institutions they they really like to take market risk and they'll underwrite it because that's what they're good at. You know, token go up, token go down. Okay, it goes down. I understand like that's what I get paid to do. Fine. They don't get paid to take reputational risk in the form of regulatory risk. >> They if they do an investment and it gets hacked and you're like, "Too bad, so sad. There goes your money." like they're not comfortable with those risks. And so as I'm talking to, you know, the Franklin team and I talk to the lawyers and the compliance folks and the vendor management and the cyber folks, that's a huge part of the differentiation that an institution like Franklin brings to the table. And I

mean, I couldn't be more excited, man. >> Yeah. And and so your firm bringing this kind of expertise, this, you know, decade in the space, understanding how it works. I'm So I had a guy in here a couple days ago from uh JP Morgan and um you know he's like doing this special division and you know his biggest thing was like I I'm just trying to talk people to like understand what the hell's going on here because like that is the most valuable like insight, right? And like I'm not going to say that something like XRP isn't worth 145 billion, but like I'll tell you that I, you know, am more interested in this than I am in that and that I see value in this thing even though that the mainstream adopts this this idea and like I here's why, you know, and it's

just maybe it's my subjective opinion that's biased in its own way, but it's like here's what I've learned over eight years in the space. Here's what I think matters. Here's where I think this is going. And so I think like that is like an invaluable uh trait to bring to a large institution who as said isn't late to the party but the on the ground expertise the day by day the kind of in the trenches so to say is um I think a lot of these firms are going to be you know looking to acquire that. Yeah, I think try to serve as a Rosetta Stone. Right. Right. Came from that world, built businesses in that world, ran three global businesses, been in the other world. How do we translate and and what you really need to translate is utility, >> right? Um this is why this technology

matters and you can talk about it in their voice. You see, we can eliminate Hurst at risk in your FX in your FX business. Oh, really? Like, and people, what the hell is Hurst at risk? Well, it's settlement risk. It's a fancy way of talking about a bank that went bankrupt in 1974. We can translate that for them. >> And also the really interesting thing happening right now is remember back in like 2018 it's like blockchain not Bitcoin. >> Yeah. >> Right. You're seeing both now. >> You're seeing blockchain getting integrated to address those things like Hurst at risk to um help facilitate 247 markets, things that institutions are desperate to have to survive. But they're also starting to recognize that

I can't divorce the the blockchain from the crypto assets as well. And I think there's a lot more focus now on understanding the fundamentals of those assets. And they're starting to blend together with other assets. Like in a very simplistic view, you can take a token and you can wrap it. You can make a tokenized equity and you're unlocking 247 market instantaneous settlement. You can wrap native assets. Well, and it's kind of very similar, but it's what's underneath, man. Yeah. >> And so there's that light bulb is starting to go on. Um and the other thing is like the big boom of 21, you know, a lot of banks and institutions started their their little digital asset teams. Boom happens. All that talent left. Well, since we've been in a bare

market for a while, those digital asset teams have been building in their institution because it's been a little bit nutty out in cryptoland. So you have a lot of continuity now and you're starting to see things come out of that continuity from the building perspective. So exciting times. >> Yeah. I mean, I think one of the most exciting things about the latest happenings in the institutional verse has been the I mean, not to kind of come back to my bags here, but hypoid ETFs launch and then Bitwise and 21 shares just slamming the buy on them as well. And so, obviously, it was, you know, people buying, but I think they also um bought some of their own from their own kind of like fund or whatever their capital is. And so like a lot of us were excited about the adoption of the

institutional landscape from these products and from these assets, but like a lot of us just want to see them buy what we've already been holding for the last 5 10 years. >> Yeah. You want them to be your exit liquidity right? >> I mean that was the meme in 2017 [laughter] was uh the institutions are coming. We're going to dump on them. >> But yeah, >> but but if you have fundamentals, you're really not dumping, right? >> Exactly. And I think maybe that's the dislocation is the natives are we're going to dump on institutions and you're like wait a second these institutions they understand utility and fundamentals and so like it's pretty hard to dump on because they proide that they they they look at these assets through like very sophisticated fundamental research and and so >> I don't think it's that easy. They're

not suckers. They're actually very sophisticated um and they know how to underwrite value. >> Yeah. And and you know what, like you the part that crypto is very appealing for people like myself and people in my generation is we look at the stock market, we look at the housing market, we look at the cost of groceries, we look at the cost of gas, we look at the cost of travel, you look at the um any market in the world and it's like holy Like this is my this is my entry. This is my entry right now. 7500 S&P is my entry. $30,000 NASDAQ. That's my entry.

>> Rates are high. Hard to buy a house. Yeah. >> And so you get into Bitcoin, you get into Ethereum, you get into Hyperlquid, you get into whatever asset you want to buy. And it you feel like you have a chance to be like before, you know, the the older people buy it. >> It pushes you out on the risk risk curve, right? Because you're trying to I mean, look, when you're younger, you should take more risk. But I feel like for your generation, it's pushing you farther out on the risk curve because a lot of people don't have many other options, >> right? They they're taking a swing at the fence and they and they're going for it and they're hoping, you know, and that's unfortunate. Um, but look, I think at the end of the day, as time

goes on, people will will say, "Wait a second, I have access now." Like years ago, if you're up and coming, the only way you could learn about finance was through like on the job training. You know, you have to learn from other people. But now you have AI and you I feel like the democratization of knowledge particularly in finance and other things will help give you know your generation and younger a leg up >> because you don't have to rely on an older person to teach you or an intermediary to serve you because you can do it yourself like we never you know it was much harder for old people like me to get access to information. So I do think there's hope.

>> Yeah. Yeah. Chris, just kind of closing thoughts here. Are are you um bullish for 2026 for this industry? >> Yeah, wildly. >> Yeah, >> wildly. Um does that mean that you know we're going to hit all you know all-time highs tomorrow? Well, maybe in hyperlquid, which we keep seeing. Um but but um and I'm not I'm not here to shill hyperl, but um >> but I I feel like we're in this really unique constructive environment where sentiment is not so good, fundamentals are improving. Do your own research. um connect with those teams, understand the asset just like those institutions are doing. And I still think you can get in front of them because it's going to

take a long time for them to understand the space. Um and I think, you know, retail other folks can be much more nimble, do their research and get in early. >> Yeah. Yeah. I agree. I'm not sure, you know, it would be a surprise to me if Bitcoin went to ultimate highs like sometime, you know, in Q3, Q4. >> You wouldn't be surprised or you wouldn't? >> I would be surprised. would be surprised. >> Yeah. But I wouldn't be surprised if it kind of, you know, slowly chugs along, sideways a bit, up a bit, and we get these pockets of of assets that do. >> Yeah. You know, >> it's very hard to trade short term.

>> Right. >> Right. Who knows? Maybe tomorrow Iran the issues go away. The second the pressure in hormones comes down, inflation just drops down, uh, trueflation calls it, whatever. and you know then rates are not going to rise. They're like there's so many things that could happen near-term that it's very hard to predict and trade. Um you know there's a Bitcoin reserve that gets announced and it starts getting funded. There's so many short-term unknowns and so it's very hard to invest through that lens. You have to step back and say wait a second here's what I'm seeing in the world. The world is tr is really turning into a trustless permissionless place.

if only there was a trustless permissionless asset. H >> yeah, >> you know, like and so you have to step back, think long term and um and then put your put your chips on the table accordingly. >> Yeah, Chris, thanks for your time, man. >> Andy, brother you joining us. That's Chris Perkins live from the tokenization tower, guys. We'll be right back with our next guest, Austin Barack of Relayer Capital, talking more about the AI and crypto thesis to wrap us up today. Don't go anywhere. It'll be a good one. [music] Hey. Hey. Hey. [music] [music]

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we get You know we get [music] [music] attend the Davos of Web 3. [music] See you next year, >> second and third of June at the Louver Palace in Paris.

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Oh my god. SEC delays plan to allow tokenized equities in the US of a Oh my god. Oh my god. No. No. No. Just when you thought there was going to be a bullish weekend, the SEC rug pulls us. Markets are down on the news. No. We were supposed to get this innovation exemption this week. Of course, I mean, now, who knows when it's going to come. Etsy has delayed their ruling that US tokenized equities will

be available in the US. Not great for the program. Um, yeah, that is unfortunate, guys. We really wanted to see that go through. If you're a bull right here, you wanted to see that go through. new type SEC delays, stock tokenization, crypto falling on the news. It is indeed. Um, yeah, man. Damn it. Damn it. Oh, well, short-term fixations for long-term growth. We kind of need a little bit of a pullback, a little bit of a reset before we can get going again. So, the the market will digest this over the weekend and we'll be all right. Guys, we're going to have Austin Barack of Relayer Capital join us now. AI Supercycle episode number 34.

Take a quick break, throw you to the animation for our lovely friends at Near, and then get the segment started. Had to bring this up. Not the ideal news that we wanted to see on a Friday afternoon when we're balls to the wall, long all of the crypto assets that would benefit from tokenized equities being available in the US, but that is what it is. We just got to pray this is Trump manipulating so we can get a better entry. I don't think Trump is manipulating my uh low my $5 billion $50 billion asset prices, but maybe we we can hope. Guys, we we'll be right back with Austin. [music] >> Welcome back to AI Supercycle, our

premier AI show airing every single week [music] 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. Now, sit back, relax, and enjoy the show. Ladies and gentlemen, welcome back to AI Supercycle episode number 34. Our weekly premier AI show powered by our friends at Near. Visit near.ai to learn more about their AI tooling and their confidential intense product as well as

their AI product powering the agentic future on chain. I'm with Austin Barack here in the AI supercycle. Austin is the founder and managing partner of Relayer Capital, a thesis driven crypto asset investment fund. Previously a partner at Coin Fund on both venture and liquid sides. Brings deep expertise expertise in protocol design, GTM, tokconomics and more. Wart in finance alum, not his first time on the show. Austin, welcome to the show, man. >> Good to have you.

>> All right, we're going to take a quick break, guys. One sec. I I can't [music] [music] [music] >> [music] [music] >> Money power [music] [music]

big money [music] power We get [music] we get deep know we get deep know we [music] get deep we get deep know we get deep [music] we get we get deep we get deep we get [music] we get deep know we get >> [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. Now, sit back, relax, and enjoy the show. All righty, guys. Welcome back to AI Supercycle episode number 34, our weekly premier AI show powered by our friends at Near. Visit near.ai to learn more about their product suite. Today we've got Austin Barack on his Venice Grass near and AI thesis. Austin is the founder and managing partner of Relayer Capital. Guys been absolutely dialed in

on the timeline as of late. Good to have you Austin. >> Yeah, really glad to to be here. A lot a lot of interesting things happening in in cryptoland these days. >> There is, man, there is. Um, man, let's just start, man. I I use Venice for the first time a little while ago. We had Eric on the show in February at Nearcon and um I typed in like, "Hey, is this really private?" And it was like, "Yes, the inference is private, blah blah blah." And then I wrote back, I was like, "That's based." And then it responded back and it was like, "Yes, it's pretty cool, isn't it? We with Venice, you have this." And so like there's kind of like this really cool first moment when you use Venice and you're like, "Oh, wow. All of my chats that I've been using um with the you

know typical providers are such are so not public but the data is going to the large providers and all the deepest darkest diary rights or freaking you know whatever it is business secrets plans etc and so give us your private AI Venice kind of highlevel view here market structure thesis founding team and let's start Yeah. So, V Venice is really interesting because they've gone through so many different iterations over time and I first came across the project January of last year because I I was really big into virtuals and AIXBT and a lot of the initial airdrop went to

holders of of tokens in those ecosystems. So, that that's when I first came across it. It was really, you know, interesting product. Um, but AI and it's wild that it's only 16 months or so, but AI wasn't as ubiquitous then in terms of just in, you know, a necessary part of everyone's daily life. And over that period of time, we've gone to the point where whether it's claude or chat GPT or or another service, it it's not only it started off as supplanting Google search like, oh, I'm going to just search whatever query I want on, you know, an AI platform using an LM instead of Google, but now it's around creation.

It's around solving tasks. It's, you know, it's having a team of people around you and using agents. And what I think people are realizing over time is that in AI more so than anything, privacy is incredibly important because you're sharing your health data, you're sharing your financial data, you're connecting all of your files, you're you're sharing your entire life in a way that you haven't before. Because in the past, people were like, "Oh, how do I think about privacy in the context of social media? Do I have a public or private profile? Does Facebook have too much information on me?" And this is is not like 10 times more data using AI. It's a hundred times more data. And what's really really cool about Venice is it's

not about just having AI usage in a private context. It's about not sacrificing user experience at all and actually improving the user experience because instead of being wedded to one model where it's like oh I'm using chat GPT and you know I'll use their models as they upgrade or I'm using anthropic and you know the different models as they improve over time or Gemini or otherwise or the different open source models. You can use the right model for every task and you can select which models you want so you can be as custom as you want. So what they've built is first of all a consumer product that's just really really really good and most of their users don't know anything about

the token and then the token has this added element on top that's really cool but I think that's the and I'll stop talking in a second but you can tell I'm very bullish on on what they're doing. It's you have this situation where and this is where I think consumer products are headed in crypto where the token can be an a really important part and like supercharge the experience but for the majority of users they don't need to know about the token to find it useful. >> Yeah. I mean that's like the breakthrough of consumer product crypto underneath but it adds this kind of like interesting element. people are actually comparing it to like Luna um and this like staking to get this DM token and then you have

like this debt with with your uh inference that you get you know um that you get to buy into by staking the token and people are like people are having issues with the token dynamic right now. I'm curious, Austin, what is the right way to think about the Venice VDD token and DM token as they exist in the current Venice flywheel and then kind of take us through some of like the revenue side as well of Venice because they are doing some buybacks but not a ton. How do how do the how do these two tokens work and um why is it not like a Luna?

Yeah. So, they have three million users. They just announced that and and they're growing incredibly quickly. So, they got a million users in the last um three months or so. A million seven months before that. So, they're constantly accelerating. They have two tokens. So, they have the VVV token which protocol revenue is used to burn VVV, but also you can also stake VVV to get a free membership. But the most interesting part is you can stake and lock VVV and that allows you to mint a token called deem. You can also buy deem in the open market but you can stake VVV and and mint dem. And what deem is is for every deem token that you own you get $1 per

day of free inference compute on Venice's platform. So you can think about it like a perpetuity where you know over the course of a year you would get $365 of compute but it's use it or lose it. So it doesn't acrue over time. If you use 50 cents in one day the next day you restart with the dollar and the next day you restart with the dollar. Um, and it's created this really interesting almost like loss leader customer acquisition tool is the way that I think about it because unlike Luna where you got to this insane amount of um tokens outstanding and like billions and billions of dollars of stable coins, they are very very explicit about boxing in what the potential cost of this is.

So right now the the the amount of deem that you can mint per Venice token declines as more is in circulation and creates more or less a hard cap around 38,000 deem. So at the current point if all deem was locked and used for inference because if it's freely circulating if it's in an LP pool I if it's you know not in that system then you're not earning the dollar per day. You just have that asset that could earn the dollar per day. But if all of it was being utilized, that's $38,000 per day maximum of cost to Venice. And that's directionally $10 million a year. And it can't be more than that. Right now about 10,000 deem is being used per day for inference. So that's about like a three

and a half million annual cost. And that's offset by the fact that they have uh probe subscriptions, premium subscriptions that range from $18 a month to $68 a month to more. And then as people use the platform, they purchase tokens and and you know purchase additional credits to use the models. Um they've grown from a couple billion daily token usage to you know as of recent count 70 billion. So done like a 50 15x in the last couple months. So I would say the the way it's different here is there's a maximum potential cost to the company but by people using DM they're also using uh subscriptions they

also purchasing other credits if they need more than the dollar per day per token um so it's very easily covered by the revenues of the business um and well exceeded by the revenues of the business but what what is really cool about it on the other side like you know how is it potentially Luna and and I think it's it's clearly not. But the really cool part is you can guarantee access to compute in the future. And right now it's valued at like a 20% discount rate at around $1,800. I think something like this should be rout valued more or less along the lines of like corporate bond. So say like 8 to 12% which would put its price a lot higher.

just, you know, as an example, 10% would put it at um 3650. Uh when I started uh looking at it, it was valued in the $200 range. >> It was $200. >> Yeah. And I was thinking about it. >> Yeah. And I'm like, there's no way that something that's producing $365 a year should be worth >> $200 unless people think that Venice is just not going to be able to support it. U so at that point, it was a no-brainer. I I still I still think there's room to run. Um, but on the economic side of Venice outside of DEM, the the numbers are staggering and and unlike anything that that we're even seeing in crypto, it's kind of like growth rates that you're only seeing in AI, which is why it's so compelling.

>> And so, you're pretty a firm believer that I I think then it's tapped almost $20 today, the actual VVA asset. >> You think this one half to2 billion range is firmly undervalued for VBV? >> Yeah. So when I first started buying in January, it was like, you know, about two and a half bucks. And >> that's when we had Eric on in Feb. >> Yeah. Yeah. It was, you know, uh Eric has consistently been ahead of the curve in everything that that he builds. And, you know, I've been following him for for a long time. So that made this investment a lot easier because, um, he's he's proven himself time and time again. Um, but at that point, they were doing a couple billion of tokens a day.

Now they're doing 15x that. They had about, you know, maybe like a million and a half um total users. Now it's 2x that. They are by my estimates probably doing 3x or more the amount of revenue that they were doing before. and likely trading in the like 20 to 30x um revenue range for a company that's growing I don't know like 20% month over month uh which I think is still incredibly cheap and you compare it to an open router which is worth the same valuation doing similar amounts of revenue maybe less um growing perhaps not even as

quickly uh and the difference here is they own the customer it's not backend and infrastructure that's plugging in. People that use Venice are using Venice every day. I mean, that's the only way that I use AI is is through Venice. Um, and yeah, I I I think there there's a lot of room to run here. >> Yeah. >> And of course, none of this is financial advice. Just my personal opinion. >> So, I haven't been up to speed on grass at all. You've been harping on this one for a while. It looks also ready to fly. I'm sure it's pulled back a bit today. Whatever.

$50 million or more of annualized revenue accelerating triple digit growth. What is the premise of grass? Why like how does it make money and why is it compelling? >> Yeah. So for grass, they collect data sets and sell those to Frontier AI labs uh that need that data to train new models. And these labs are generating new models at an incredibly rapid pace. But in order to generate those new models, they need more data. And it's not just like random scraping of the internet. It needs to be very specialized. It's very specific data sets and it needs to be high quality. So that's the the role that grass is filling. And

because there's such an incredible amount of spend around building these models, grass is a beneficiary of that because then there's just a larger and larger demand for data. So the team there h has been you know building for years. They in you know I think they did like $3 million in a re revenue in a quarter at one point last year. By the end of the year they did 12 million or almost 13 million in the quarter. um based on my estimates, they're they're growing even faster and they're going to have their token holder call in the next like month, month and a half. Um and you know, we'll we'll get more information, but this is something that is showing tripledigit growth. It's 50 million ARR

or annualized revenue based on the last numbers. I expect they're probably closer to 80 right now and it's valued around 400 million. So, for something that's growing so quickly to be valued at 5x just makes no sense in my mind and and is um a really good candidate to rerate. And >> and does Grass have a any working relationship or anything to do with Venice at all? >> Uh they they they don't at the moment. Um Venice is is generally not building their their own models. Um right. So yeah, there there's no relationship at the moment. You know, who knows down the line. Um, but I look at it as like two

interesting different sides of the equation where it's one is how do you use AI and how do you use it in a private way and the other is how do you build the models in the first place and Grass and Venice are tackling both of those sides. And so grass at 5x of revenue is I mean some of these things in crypto trade 20 30 40 50x revenue. So you think like the $400 million range is is uh bit of a no-brainer.

>> Yeah. [snorts] And and I think a big part of it is like there's other things in crypto that that are trading at like relatively low multiples but they're not growing. And people come to crypto because they want to invest in growth. So, I think a lot of those examples don't necessarily hold water because there there's just not the flows. But for something like grass that's one of the best examples of something growing so quickly, I I think it it it merits attention just on that uh basis, let alone the fact that that it's, you know, in my opinion, fairly cheap.

>> Yeah. Okay. Um, do you have a thesis on near at all? Have you been paying attention to near? >> Sorry, say that again. you >> do you have a thesis on near? Have you been paying attention to Near? >> Yeah, I've been following Near. I I think Near is an interesting one even outside of the the AI component because they are the infrastructure that's powering so much of crosschain um swaps and we saw that you know in October and November last year gain a lot of attention with um swaps for for Zcash right as people were going in and out of Zcash and Near Intense while useful and probably the one of the best crosschain experiences for swapping it also plays a really powerful role for agents because

it it's in my opinion one of the best uh pieces of infrastructure to plug into to do crosschain swaps where you don't have to have all these other dependencies. Uh and they're seeing that grow really quickly. Uh I I think right now it's like if you're an L1 you somebody tweeted this out earlier today. Um, so I'm like I thought it was so well uh said, but I'm I'm repackaging it and I I don't want to like not attribute credit. U but it's essentially like you need to be a vertically integrated app experience. You need to be 10 times better at something or you need to um you need to be like really really really good at one type of application. And I

think Near is just absolutely crushing it on the intent side and they're doing a lot of other things on like confidential intents, other elements around like AI usage, but they're one of the L1s that's really found their place. It's like an NBA player and all of these new L1s and L2s are coming to to market and they're the really interesting rookies and, you know, over time some become the superstars and some just kind of like fade away. But then you have the the role player that's just really really good in their role like I don't know like Lou Dort on OKC or Alex Caruso or whatever. Um and Near feels like one of those players where you know it's not LeBron James but they're really important because they're just so good

at what they do. >> Yeah. And it's also like sitting in the middle of like this privacy AI thesis which I think is like really obviously gaining traction. Another one that's been slept on that Robbie has been harpening to me about, unfortunately, he's not here today, is um Akos and how they were so early to this kind of like distributed inference, distributed models, this kind of like decentralized training, right? This whole that was like this that was like the first iteration of crypto. Then we had like these like fugazi agents with like the memecoins and now we're on to like the next iteration of the decentralized inference models training, but like with like far superior products. Have you looked into Akos and what they're doing?

Do you have a thesis there? >> Yeah, I I've definitely looked into AOS. They started off with with um you know decentralized CPU marketplace and then GPU marketplace. But you can actually check on the amount of data that's running through open router. A lot of that is going through AOS which is uh the AOS ML which is very cool to see and that's just you know public data. Um, but yeah, I I admittedly am not like it's not one of the names that I'm following as closely, but it's for a team that's been around for a really long time, it's constantly iterating.

It's very cool to see them find uh real product market fit right now. Uh that that seems to be accelerating. >> Yeah. And I'm just going down the just going down the list here. Um there's a company called GitLob. I don't know if you've seen them. They're like a very low cap on base. Um, and they're crushing the amount of tokens in production per day as well. Um, and there's this kind of new cohort of like highly speculative AI tokens on base right now. And there's like so many little niches to understand in the puzzle here. And so I guess like not to ask about kind of like low caps or you know what you're seeing there, but more

like broadly is there a specific part of this stack that you think is most ripe for massive growth when it when you can apply like the blockchain rails to it? Clearly we've seen private inference and uncensorable chatbt with Venice with Near. It's kind of like this agent marketplace with Akos. It's this AOS ML grass the data sets. What is the is there a couple like key sectors or parts of the AI stack that you think you know investors should look at for being meaningfully replaced or usable when it comes to like applying them to the blockchain context.

>> Yeah. So I I think you have the privacy content uh context around private usage of LLMs as well as uncensored usage. Uh you have the data collection side to trade models which is grass. Um you have inference and compute um which you know you mentioned AOS we're seeing other inference marketplaces pop up. There's one that's actually building around deem as as well as you know other services that that allow you to um sell your spare compute and that's called an seed. That's been an interesting one that that I've been following. There's um there there's no live token yet or anything.

Um but but that's one that that I think has been doing some some cool things um particularly um aligned with with Venice and Deem. Um I think there's decentralized model training as well. uh in terms of how can you build open- source models that also have the ability to retain ownership and monetization by using private weights and there there's a couple that are building in that sector. Plurales is is one of the ones that that I think is most interesting um that that's building there. There's news research that that's doing some really um interesting things with with Hermes.

Um and you have um Prime Intellect, a couple others. Uh so I think like the decentralized training, the inference and compute marketplaces, the infrastructure around agents, the data and then just like the consumer application of model use is is the main areas that that I'm looking at. And then, you know, Austin, I think like there's this AI thesis and, you know, covered a lot of like the big names here, but there's also this other thesis that you've been, you know, just pounding on, which is there's this new way to think about token models and economics. You've been a big proponent of, you know, like Aerodrome or

Hyperlquid. I'm just curious how do you think more broadly outside of the AI context as we kind of come to a close about this net token value flows and thinking about like credit and debits and how how like the industry is evolving in their thought process specifically around analyzing token economics and the right mental model for assessing the plus and minus or the credit and debit of a given crypto asset. What is your current framework for this? And like do you have a like do you agree that investors should be thinking about this like a credit and a debit like a plus and minus sheet? How do you kind of think about uh net token value flows?

>> Yeah. So, I I think there's a couple ways and and one it's not one sizefits-all because let's start, you know, at a high level with uh buy and burn. And that's something that Hyperlid has made um really popular and everyone's like, well, look how good Hyperlid is doing and they have buy and burn. But there for every one Hyperlid, there's nine other tokens that have the same buy and burn and their token price has been horrible. And what's the lesson there? It's Hyperlquid is a great business, hence people like the token and buy and burn is how they deliver value to token holders. But if it's not a great business that's growing really well, your token's not going to just go up

because you do buy and burn. So like that that's the first thing that I think people conflate. The second is are you driving value to token holders? So whether you're doing buy and burn, buy and distribute, um whether you're do, you know, even just reinvesting in the business, having money in a bank account to give yourself more bank balance sheet flexibility. Do the token holders maximally acrue the value of what's being built? And that's the case with Hyperlid, that's the case with Aeradrome. you know, for all the, you know, wish that a lot of people have that grass did more buybacks, it's very clear all of the tokens, uh, sorry, all of the contracts are signed with the

foundation. All of the revenue goes to foundation bank accounts, all of that is controlled by token holders. So, I think there's a lot of different ways of thinking about it. And then it's a matter of token flows. So, you know, Hyperliquid has a theoretical maximum of how much could be unlocked every month, but really it's like two or 300,000 tokens and the amount that's being purchased from the ETFs, from the DATs, from the assistance fund is much much higher than that. So, naturally, you have more buyers than sellers. something like Aerad Drrome, if you lock Arrow into V Arrow, soon to be called S Arrow when they do their ETH mainet expansion in July, you're earning all of the

revenue from the platform and you're directing emissions to the relevant pools where you where you think it's most important for there to be liquidity and where you're going to generate the highest revenue. And they're like, well, if in a given period the value of emissions exceeds the value of revenue, then you know it's net negative or it's net earnings or sorry, net negative earnings. And I think that's really the wrong way to look at it. The way to think about it is how much is being gener earned as revenue versus how much is freely circulating afterwards and not being sold because you have the you know the um they they recently changed the

name to the momentum fund but you have kind of essentially the foundation that's doing buybacks all the time. You have people that are earning arrow that are locking it every period to stake it to earn the revenue. And then you also have people that are just bullish on the token or not selling. So when you think about it on that basis, every single epoch, so every single week there's meaningfully less tokens that are going to the open market than the amount of revenue that's being generated. And then when you factor in recent launches like you know there was the Atlas aura and others at this point Aerome is earning meaningfully more revenue and when I say airum I mean token holders than is actually coming out as emissions. So I I

think for every example you have to look at it in a nuanced way but at the core is do token holders earn the value of what's being generated and then you can start to iterate from that lens. I think the entire industry is shifting into a similar mental model as it's very nuanced. Um but it's like we have two emerging like things happening right now. It's like these like revenue fundamental companies and then these like more narrative niche very like useful technologies Zcash uh Venice Near these kind of like very niche AI privacy things and then just pure businesses on chain and like in the middle right now there's just not

a lot going on. >> Yeah. No, I think that's right. And one of the interesting things about this market is there's a smaller set of interesting tokens because people are a little bit more realistic around like what's finding traction, what's like real in the moment and not just like hype and not when I say hype, I don't mean hyper, but like I mean like like what what's like euphoric uh dreamlike excitement and you know there's maybe like 10, 15, 20 tokens that have really really strong fundamentals. So I think for that reason we're seeing those tokens meaningfully outperform the market because for the first time in a while you are able to

pick from a much smaller subset. So all of the flows are going to the things like Venice, like Hype, like Grass, like Arrow, like Near, uh, like Zcash, which is another one on the privacy side. You know, people are, I think, a little concerned that Bitcoin is becoming too impacted by Sailor, and that that's like a whole another conversation. Uh, and that Zcash is the original ethos of of Bitcoin with the similar structure. And Zcash wallets, you know, doesn't have revenue in that context. It's um it's an interesting asset because it becomes more useful the higher the price goes because then it has the higher higher likelihood of being entrenched in having uh consensus community value around it.

Um so yeah, we're we're in this really interesting place where it it's getting a lot easier to bid the right coins. You just need to like you know, be be a little bit more um you know, like channel your your research into what's real and what's not. And you know, for people looking for the 5 to 10x or the 3x, you're much more likely to get it than trying to get the 100x. And maybe you get the 100x anyways. Um but but I think like there's a there's a set of businesses that that are doing really interesting things and those are the ones that I'm anchoring to. Yep. No, I mean it's like as it's easier if you are disciplined and just

stay in the lens of like what's working and what's going up. And I mean today's been a bit weird, but you know, you zoom out here. A lot of these things are I think they're kind of like buy hold and forget. Trust that you're in quality. Trust that you're going to do well. Austin, have a great Memorial Day weekend, man. Thank you for joining us in this episode of AI Supercycle. Been loving your content. You've been absolutely spot on last six months. So, keep it up, man. >> Thanks, man. Glad to be here. Talk soon. >> All right, buddy. Have a great weekend. All righty, guys. Man, I don't know what's going on out there, but uh SEC was not too happy about that tokenization ruling. Industry is undergoing some structural change.

Everything's maturing. There are a couple assets worth bidding as Austin said, and I think it will continue to be that way. It's a long weekend in the States. We We will be live back on Tuesday. Our episode with Arthur and Ilia is dropping on Monday. Ladies and gentlemen, have a fantastic weekend. Tell someone that you love them. Thank you so much. [screaming] [music] >> [music] [music]