MegaETH Mainnet Launch, Tempo Poaching Continues, Liquity CEO on Stablecoins, Then Illia & Eli Join

Transcript

[music] [music] H the [music] [music] hot break down break >> [music] >> off the back. Back back [music]

up [music] the >> [music] >> JP Morgan, Black Rockck, DTCC, Fidelity, the entire thing was just institutions. It's [music] just it's next level. This industry is going to the next level. And guys, I I don't know what else to say. [music] I'm bullish. You said it. You finally said it. I'm so bullish. It is bullish. I'm bullish. We're bullish.

>> [music] >> How the mother break down break down [music] the [music] back the >> [music] [music] >> How the [ __ ] the

[music] >> [music] [music] >> H. [music] [music] How the [ __ ] >> [music] >> The rollup is headed to the top. If we're not already at the top, we're going to the top. We're on fourth floor today. We're going to be on floor one and then we're headed straight to the

moon boys. >> Let's go. V-shaped recovery, guys. Welcome back to the Rollup TV. and he's running around behind the scenes trying to get a coffee. He's going to be back. We missed him last week. But we're going to have a full show for you guys today. Mega ETH uh launched mainet. We're gonna be talking about it and we're going to get the lads for Mega E on the show. We are also going to be chatting with Michael from Liquidy on our stabled up segment of the week. I'm watching Andy P spill coffee behind the scenes. And uh guys, it may be a bare market, but we're going to

keep the energy alive here at the Rollup TV. We're not going anywhere. We're going to go straight to the Empire State Building. I don't know if I was supposed to say that, but we're coming to New York in a big big way. So, be ready. Don't go anywhere. We're uh we're we're just getting started here at the rollup. All right, let's uh let's bring this maniac up. See what See what he's thinking. >> Oh, yeah. I'm locked [clears throat] in. Yes, sir. What's going on, boys? Good to be back. Absolutely good to be back.

>> Andy, go on a little Japanese uh rant. If you don't mind, I'm going to put some headphones in. >> Dude, I went to Japan for the last week. It was insane. We had powder on powder on powder. Um I mean, yeah, I just lost my mind. We just skiing skiing hard. Stayed a couple nights at the Aman Tokyo. probably the best hotel I've ever stayed at. Um, it was pretty insane as well. And yeah, now we're here. We're we're uh we're back in the States somewhere in an undisclosed location and we're uh we're all in uranium still pretty much. And uh we missed the draw down on on crypto.

Uh we identified that Sky is going to be an outperformer, which it is, and it is literally breaking out to new local highs. The N7 index, for those of you who've been following, the NEO Finance index is absolutely cooking. Um, I mean, absolutely just on fire. So, [snorts] if you guys have been paying attention to that, you're probably winning. Uh, we have a new dashboard that we're going to get ready to launch shortly. But, yeah, I mean, uh, I'm in Uranium. It looks great today. I'm a little bit underwater still, but uh uh yeah, I mean successfully avoided the draw down. So I don't know how else to put it, but I was screaming on the stream that I was bearish. Every guest that we had on, including my lovely co-host Rob, was bullish. And uh here we are today with a

uh $70,000 Bitcoin. Feel like 60K was a great buy to be honest. Um I'm looking at the charts now. Looks pretty good, but I don't know. Uh, I I think we got a while to go here, boys. So, I'm chilling. I'm letting the market come to me, no rush. And yeah, I just I don't know. It feels nice to be in a good position rather than in a It feels nice to be in an offensive position rather than in a defensive position in the market. As far as travels goes, I mean, we got some other conferences coming up. We got Nearcon in um the end of the month.

should be pretty epic considering all of the open claw happenings and uh Claudebot happenings. And we also have East Denver uh which honestly I heard it have not filled up their sponsorship slots. Um and so yeah, pretty pretty excited for that. So Andy, let me let me fill you in on some of the streams that we had last week. Um there's really two d and they're diverging thesis and concepts that are happening. On one hand we have uh the emergence of neo finance. This is something that we predicted and we saw firsthand uh at smartcon last year in November uh which feels like a lifetime

ago. U but yeah smartcon was back in November um and we saw how all these institutions are starting to embrace tokenization and digital assets and blockchains. This trend is accelerating. We had, you know, several head of tokenizations uh and digital assets on the show last week. And then we also had this crazy AI sprint uh that we went on last week as well. And so we're seeing the the thesis play out in two respects. One is that old guard crypto infrastructure slop with no product market fit is being forced to innovate.

Right? So I think that's a check mark. Uh based on what we've been talking about, they're innovating in two separate directions. It almost seems like part of the old crypto infrastructure slop guard is innovating into the neo finance direction. They're going to New York. They're embracing tokenization. They're embracing digital assets. Then you have some deep tech teams that are pretty much going allin on AI. They're running Claudebot. We had Near on the show last week. They were talking about Open Claw. They have some really, really exciting things coming up. And we're also seeing the emergence of kind of like a hybrid world in the middle. We had multiple people come on last week and talk about vaults. There's some

people that are starting to think about how AI could play a role in asset management and vault management. Uh and then obviously you know it just in terms of the amount of financial mechanisms that we're able to encode into vaults in terms of you know restricting entrance and and programmatically uh changing the structure of these vaults. Um this is also starting to take a lot of people in the legacy financial world by storm and they're really embracing it full stop >> about the the vaults. People want us to um people want us to do vaults for our N7 index. By the way, Plume hit me up.

Glider hit me up. >> I had someone hit me up and ask if there was a a place or a venue where someone's able to buy uh this index as one product like an index. >> What did you say? >> I don't know. What did I say? >> I I got some interest. I think it's a good idea. Um I mean SC if you look at the dashboard it's absolutely cooking. I mean Sky is backpacking right now. Uh which is sick to see. Um yeah >> but yeah I mean I I think that the index is is doing really well. So um yeah I'm excited about it.

>> There was more drama with Hyperl. Should we hit some should we hit some headlines or >> I think I think our guests are here. We've got our Mega ETH guests today. Their mainet has launched which is epic. Yeah, we got Lei and um our lovely friend Amir who runs ecosystem over there going to be covering what's happening on the mega side. Their mainet launch today with the interesting KPIs for the mega token. >> Yeah. >> Um as well. So I thought that was interesting. Um so we're going to get them up and we're gonna get that started and it's my first stream in a little while. It feels good to be back.

>> It's been a it's been a hell of a week. >> It's good to have you back, man. >> Market's in the gutter though. My god, >> we missed you. Oh, we we went we've been in the trenches the last week. >> Yeah. Yeah, I bet you have. >> Let's uh let's bring our guests up. Do we have them ready? >> Yeah, I think so. >> Uh let's bring them up in the back and get them going here. >> Little Monday stream action, huh? Buzz are a little buzz a little rusty here, huh? >> Oh, no one's rusty here. >> I had I dropped all my coffee coming in here. >> Yeah, we were talking about it on the stream.

>> [laughter] >> I'm enjoying my last three weeks of freedom before I move to to New York and absolutely become a stimulated rat race guy. Stimulated rat in in the race. >> Yeah. Well, they they love uh they love the rats in New York. So, >> yeah, they'll definitely be there. That's for sure. >> You're running the rat race. That's exactly >> Look at that haircut, bro. You don't want to grow it out. Oh my god, dude. >> It's starting to get shack. >> You got to let that thing fly, bro. >> I end up with a rat. I I get like a mohawk all the way down my back. it gets too long. >> You got to let that thing fly, man. You really do.

>> I think we're ready. I think we're ready to bring up uh uh two friends of the show. Um well, the Mega E team is a friend of the show. I think it's our it's our first time chatting with uh with Lei and Amir. Um but it's an absolute pleasure to have uh have you guys on. Uh we're live. >> Yeah, Jens, congrats. >> Thank you. Thank you. Thanks for having us. >> Thank you so much. >> How are you feeling over there? >> Long time coming. just >> yeah a bit exhausted but also very excited. >> Tell us what the last, you know, 72 hours have been like over in Mega ETH headquarters.

>> H just a lot of uh last minute prep. Uh just fixing some little bugs that come up here and there. No matter how much preparation you can do leading up to this, something always comes out of the comes out of the the cracks. Um so just taking care of all of that and yeah, excited to be here now. Let's see. Let's see what comes up next. >> There's always something, right? >> Yeah. And Lei, from the engineering side, um what's the last 48 hours been like for for you? >> Yeah. RPC fires, putting out RPC fires, more RPC fires. Um talking with infra teams and um yeah, lots of liquidity movement. So yeah, it's a kind of a yeah, it's kind of a crazy show, but um yeah, we're pretty happy about the end

result, >> guys. Uh I I think everyone is probably at least surface level familiar with mega ETH. Um there's been a lot of uh you know shakeup in the L2 mental model as of late with Vitalic and and his whole his whole uh scene as of lately. But you know you guys have been working on this a long time. There is still strong strong demand for what we believe is you know high throughput chains built the right way and and targeting the right areas of where blockchain can be helpful which is primarily in the financial world as well as in other facets. just I I would love just to hear, you know, the top like three or five things, the highlights, if you will, that you think, you know, someone

who's maybe not so familiar or at least just somewhat familiar with Mega ETH, what are the top three to five things that they need to know about mainet? >> Um, first, it's uh it's mainet, so it's a real money. Everything's real. And um we just went through a um 11.4 billion transactions per second. Sorry, 11.4 4 billion transaction count um stress test over a period of seven days on the mainet on the same mainet that is going live today. So it's a really high performance um kind of battle tested by the stress test. Um second um we are meaningfully differentiated from other layer from other rollups from other layer 2s or the layer one because we are we have a um pretty um performance

latency focused um sequencer architecture that you can digitally um experience 10 millisecond um latency if you transact on mega and I think third we have a very meaningfully differentiated set of applications which um I think air will diving >> yeah You know, as as Leo was mentioning and as Andy, you experienced over the summer when you came to hang out with us in Copenhagen 2, we've been spending a lot of time just making sure that we're indexing heavily on net new applications, apps that really showcase the power of the underlying chain. So, um, a few of those teams are ready to go day one. Uh, we put out those list KPIs, one of which will be Mafia apps fully deployed. Uh, we're starting off with about seven and then additional ones

will just roll out over the course of February and March. So, again, we want to give people things to do on chain. uh just launching something and kind of let letting it live there. We're just going to continue down that. That's going to continue to be our MO. >> Um yeah, I mean I was there in Copenhagen this past summer in July, I think. Um and the the types of different teams were uh very very very interesting. A lot of younger people experimenting with really cool ideas that are possible uh when you have a really performant chain. And and I thought that was like the that was like the actual interesting thing. And Rob, I think to your point as well and what I'm curious, guys, like what is

>> of course my Wi-Fi cuts out, bro. [laughter] [gasps] >> It's totally all right, man. Amir's having some troubles behind the scenes. >> Yeah. Go ahead. >> Can you guys hear me? >> Yeah, we can. >> Yeah. Yeah. Yeah. Um guys, uh Leia, I'm curious like what's actually new for users here on day one, uh compared to like the frontier phase? I know that you mentioned it's real money. Um, you know, what can people do now that they couldn't before? And then we'll talk about some of the apps with air. >> Um, yeah. So, um, of course they can now bridge money onto me and we have the USDM which is the um the like the official stable coin on the mega ecosystem and all the avenues towards

USDM. Well, air is now partly gone but yeah um yeah, all the avenues towards USDM is now open. Um, there's a website rabbit hole. me.com um they can use to bridge um and swap different forms of tokens onto Mega ETH. Um second, we have a curated list of applications also on rabbit hole.me.com on on the front on the front page and they can feel free to check out. We have a very different we have a very diverse um set of applications. >> Yeah, third um developer access. >> For some reason my connection was cutting in and out.

>> RPC is open high performance. We have a really interesting distributed setup that um of RPC servers around the world which I don't think anyone else in the crypto industry has done before. >> Um so yeah developers are feel free to should feel free to come and uh bridge some ETH. Um yeah and um try to deploy a few applications. Maybe they might maybe they'll find that their application will run actually pretty nicely on on Mega E without any modification. Um yeah and um the documentation website is updated. Um, we have a very detailed list of differences in terms of the EVM behavior between us and the layer one and I think these are all very good reference material for developers. Um, yeah. And

uh and Lei, I think something that's been getting a lot of attention was the uh the concept of the KPI related milestones and and objectives. And you know, I think we we'll hear from Amir about how this can affect some of the ecosystem of the applications in in Mega ETH, but I'm curious from your perspective when you're thinking about the game theory around the incentives of these KPI based rewards, how how do you think this could help to incentivize a sustainable growth in the ecosystem? The KPI is really designed around um around the like the mega the mega ETH um revenue model right so we'll get revenue from mainly two sources um one

um the USDM yield because they are basically the amount of money that are sitting there um semi inactively um on on the mega ecosystem so we got yield from it and the second part is the so-called active money like the active trades on the extreme changes on the on the on lending books, right? So, we collect uh revenue from these activities in a form of the proximity market which um is I think a very interesting initiative that kind of deserves a different uh um a whole a whole different podcast. Um so proximity market and also just pure app activity, right? So the KPI is really centered around measuring the success in us generating revenues from these two main

sources like inactive and active money. >> Yeah. Yeah. Okay. Um that that's exactly where

we want to go. Um, and Leia, I'm just curious to dig a little bit deeper into the tech, like what does this truly enable, you know, a as we're thinking about, you know, the the throughput, the amount of, and this is one of Mega East, you know, big differentiators, as you mentioned in the beginning was the ability to have, you know, the the safe secure, but also the speed uh and the abundance of transactions that can go through this network. You know, we've oftent times seen bottlenecks on latency, throughput, this sort of thing. as we create more abundance for these transactions, new use cases end up developing. So, could you just speak to, you know, the the levels of scale that you were able to reach with Mega ETH,

how you were able to do that and what this enables for the Mega ETH applications. four billion transactions and that's about 14,000 transactions per second. And uh we did that all while maintaining a very low um constant transaction uh base fee or base gas price um as well as low latency. So latency almost never fluctuated. The base fee did not fluctuate during the whole period of the stress test. So I think this scale is not seen before in a crypto ecosystem because over seven in just about seven days we um um we kind of surpassed the

transaction volume on Avalanche and BMBB chain over their through their lifetime right so I think it's um I think it's a new capability that's being brought to um crypto developers and um what's what can be very interesting I think first games that spend a ton of transactions on say user interactions um high frequency trading and really fine grained market movements right so um for example now I think with with AMMs for each trade there's maybe one or two transactions maybe one user transaction a few me running but with with fully untrained order books um there can be multiple market makers competing for the same um revenue opportunity right no and they have to cancel order submit order

and I think all these activities are only for one user order to uh to be made >> u so I these kind of applications will really benefit from the high volume of transactions. We already have market makers talking to us asking about the um like asking if there's if there's going to be any fluctuation in the base fees and our answer is not likely given the the volume given the headroom of throughput you have. So I think these really benefit those um um yeah the scale really benefit those um those scenarios. Yeah, Lei, man. I mean, you guys have um basically cracked what I think a lot of the the the L2 kind of rollup centric roadmap was aiming to do in chains. But I do remember when you

guys were launching the idea, right? It was almost contrarian. It was almost like it was it was wow these guys are going to juice you know juice the performance of the sequencer one big beefy sequencer create a very very very high throughput L2 and kind of like move away from the traditional kind of thought process to want uh towards rollups uh and L2s in general now it feels like that contrarian that contrarian kind of feel and take has actually shifted to be much more consensus like a really high performance chain is what Ethereum needs is is like where this space is heading. Um, and it's also just kind of morphed into like a practical era from the development standpoint. You know, I'm sure you've

been very heads down and tunnel vision focused on the endgame from day one, but talk to us about how the market commentary and how the shift in the uh kind of uh narrative as well as the shift in the uh standards of performance has affected what you've built at Mega ETH as far as the shift from kind of this contrarian nature of what you're building to what now kind of feels like the consensus only right thing to do for L2 is to really specialize in something and really try to outperform form everyone either you know in some sort of capacity. It feels like this this shift has happened over the last year or two.

Uh talk to us about what that means from the development perspective how you kind of manage these market reactions, commentaries and narratives as you're building something with such you know you know one vision, one direction um that that you guys have. >> Yeah, good question. I I feel that I I personally feel very very very fortunate that we have an really dedicated community and and a bunch of supporters that I think supported our vision from day one. Um and um the kind of the vision the vision really came from the fact that we are we are performance people. We are kind of systems people and we don't enjoy the u the the the thought of leaving performance and or leaving anything on the table. Right? If

um the layer 2 architecture can be brought to this kind of scale then we should probably do it instead of um I guess focus focusing on some or on something else. Um so yeah we we I feel very I feel very fortunate that um yeah we have supporters from day one and I think over the time of um us building this chain um from the dabnet to test net to the mainet alpha version in the frontier. I think yeah I I do agree that the consensus on how layer 2 should um um how layer 2 should what kind of marketplace what kind of gap layer 2 should fill in the EVM ecosystem is getting stronger and stronger and I think the end result is Vitalik's post a

few days ago on on Twitter right basically saying that rollups or layer 2 should uh focusing on a few niches um as opposed to being like maybe 2x 3x X maybe 10x speed 10x faster layer one they should aim to be either extremely fast or at least have something unique to them right so we feel that it's pretty interesting validation to our road map we're not surprised but um yeah we just we're pretty happy that we took this path and in terms of the actual engineering um I think it's actually on the more um boring side we had um those ideas say EVM paralization jet compilation um replacing the Merkel

position usually try with an in-house um data structure plus implementation and um um or securing it all together using a rollup layer 2 um scheme. So these road maps were set I think almost two and a half three years ago and uh we have been just sticking to the road map unchanged. So yeah I guess the actual engineering is is tough but um yeah it's uh it's not very dramatic. >> Back I think I think we got you. >> Can you hear me now? >> Yeah. Yeah, you're good. >> My connection's not bad. Okay, good. >> Now, I was just I was just asking Leia about kind of the uh development mindset with regards to how how contrarian it was to create a super fast chain on as an L2 juice a sequencer, forget about

what everyone else is doing and do it your way. And then now it feels like as Lelay mentioned in in this post post Vitalic era that he's that he's written, it just feels so natural and so right. And I mean we've been harping on this even though some of the modular thesis stuff that we uh put out was you know wrong. I think a lot of it in with regards to the specialization was correct and and I think that's kind of what the talis getting to that's what you guys have built. So let's talk about about what that enables then air I was there in Copenhagen. You were stoked on the applications you're you're kind of facilitating the mega ecosystem. What does this uh look like from the app side? What can we do today on Mega ETH?

what are the applications that you're excited about? >> Yeah. No, definitely. So, um obviously people were familiar with a lot of the Mafia One teams um over the course of test net. Uh what I'm really excited about is for for people to start interacting with the teams that that you met in Copenhagen, Mafia 2. Um so, uh to start uh we're going to do a gradual roll out over the course of February. Day one right now, we obviously have some Mafia One teams like Showdown. We're going to have World uh come out uh in the next couple of days. Uh we have a team that's building on top of world just showcasing kind of like what we preach within the mafia which is composability and teams leveraging one another uh called hit one. Um so they're using WCM as trading infrastructure. Um again consumer finance um creating that

uh entertainment experience. Um next week we're going to have a fan favorite in Euphoria. They're going to kick off their trading competition uh which I'm really excited for people to see. Um and again for us it's catering to as many different audiences as possible. for folks who want to have the again this like entertainment consumer uh finance experience um that that feeling of just like dopamine inducing trading um that's what Euphoria and Hit One are here to do for you. Uh for teams that are looking for for net new assets um and which is something that we we are going to be focusing a lot on over the course of 2026 uh we have bricks. So uh the bricks team they're looking to tokenize the the Turkish L carry trade um so they're going to be coming in February as well.

Um so we want to again cater to as many different demographics as possible and for us net new is not just in terms of the feelings of the apps but um what those apps are able to actually bring to end users. Um so that's what we have to look forward to and then obviously back half of the month into March we have uh teams like Hello Trade uh former directors at BlackRock uh building Perpetex for equities which we're really excited about. Um we have Rocket. They're building redistribution markets. uh Blitzo uh gamified payments which I'm really stoked for everyone to start playing around with.

>> That one was sick, man. >> Yeah, that's one that I got the demo actually a week or two ago when I was in London. It's like it's so dystopian, but actually it's just so insane. >> So dystopian. So Rob, it's like it's like you know, you saw me spill my coffee today, but it's like if I if I went to buy my coffee, I could gamble to basically do double or nothing effectively. That's one basic example. So you could pay for your coffee in double if you lose or you pay nothing if you win. I think you're on mute. But like think about what that goes to for like sending money to friends or like >> I see people they're in their like vlogging and they're like all right guys I'm gonna go uh you know I'm going to go to the dentist. I gota like all right am

I gonna am I going to double it and pay double at the dentist or am I going to am I going to win and I get you know for free. >> Yeah. And it's it's it's it's so well integrated to like the the typical payments experience. Like I was sitting at a restaurant there. I didn't realize I had the the test flight app like uh paired with my credit card. So when I tap my card, my Apple Pay, next thing you know, I just get a drop down that says 200% cash back, double or nothing. And I was like, [laughter] this is just so >> I love that, man. >> And that's just one of the game features. So the the product since you've se since you saw it in July has matured quite a bit. So really excited for people to get their hands on that.

Um >> what's just real quick just quick question on that. So what is the game that's happening underneath? like is it verifiable? What is how do we know whether we win or lose? >> Yeah. So, I think uh so at one point at some point we should actually start bringing some of these mafia teams on board as well. Um because I would love for them to to be the the the source of truth for their products. But again um the everything's verifiable on chain. Um the your your counterparty here is a vault that's being run by the Blitzo team. Um and then general idea here is if you lose, you're obviously paying your merchant as well as the vault. uh if you win, the vault is what ends up actually covering your expense. Um and again, this is just one game play.

Eventually, they want to broaden the scope um and take on this this meta being um sort of like banking for zoomers. Um sort of like this next generation Gen Z neo banking. >> Something that I'm really really excited. >> I think it speaks it speaks to the the versatility of the Mega ETH brand, right? You have ex BlackRock Pers equities being built which which truly utilizes the underlying tech and then all and then you know the memes are tech in and of themselves right you've got like this this cav cache around the brand as well that sort of enables like this neoanking zoomer neo bankanking right alongside a lot of financial infrastructure so that you do benefit

from co-mposability all across the stack. >> Yeah. No, and I mean like pointing it to those two specific teams also just it's it shows sort of like this this dichotomy that you see in the mafia is just very poetic. Uh we don't want people sort of pigeon holing us into saying we're just doing X or we're just doing Y or we're just doing Z. Um any anytime a person thinks like okay we can we can put Mega into a box. This is what the ecosystem is about. It's DeFi chain. It's a a deep pinch chain. Whatever the case is, we're able to introduce an entirely new team that kind of uh invalidates the entire thesis. Yeah. Um, so that's something that we're going to continue to double down on over the course of 2026 and beyond.

>> Love that. Lei, let's talk mega token. Uh, interesting KPIs uh from the kind of pure onchain metrics, right? Uh, from stable coins with USDM uh to other kind of uh important metrics also USDM revenue will end up being uh used to be buying back and accumulating mega. People are kind of curious about why why the stable coin etc. But let's talk about the the the onchain KPIs. How is that going to work? How will you enforce these onchain KPIs and maybe just talk to us a bit about some of the decision-making process here from the from the uh development side as to why you guys feel that there are certain like basically onchain

northstars that you're looking for um and kind of what that looks like from the dev side as far as uh you know implementing that KPI, enforcing that KPI, etc., etc. Yeah, good question. I think Amir should talk more about the like the inception of the idea, right? And uh um on the implementation side is kind of straightforward because we have um enough data sources. We have our in-house indexer and uh um yeah, we we will have a dashboard um that is public that tracks all those um metrics. Um yeah, I think for USDM is actually straightforward. Um the the circulating supply of USDM, you can even look at it.

You can even look it up on those um block explorers. And um for mafia apps, we have a few key mafia apps that will give us um insights into their ops and uh we'll collect those data and uh post it onto the public dashboard. Um and um yeah, same goes for same goes for the proximity market. Um sorry, same goes for same goes for the other KPI um criterias. Um yeah so enforcement will be manual but the tracking process will be transparent as transparent as possible um on this dashboard. Amir, do you want to go next?

>> Exactly. Yeah. No, and to the to the USDM point as well. Something that we're not trying to kind of incentivize over the course of this KPI program is just a bunch of uh inflated TVL metrics where people just uh just have a bunch of USDM sitting in their wallets and doing nothing. Um I think that is net negative for the ecosystem. Um it doesn't actually do much. Um so for us we care a lot of that care a lot about having that USDM actually make its way into the applications too. Um that's something so we're going to have verified smart contracts places for people to actually interact with deposit into um and again use that as an initial bootstrapping period for liquidity on the chain. be it our lending products uh like Avon and A

um whether it's WCM and their lending arm um bootstrapping our pools on Kumbaya we want to make sure that people are maximizing the capital efficiency of these this USDM as opposed to again just kind of holding it idle in a wallet. >> Cool. Um no I think I mean is this the first time that you guys have seen this kind of KPI based token launch or is there did you pull inspiration from elsewhere? How did you kind of come up with it? So yeah, so um it's actually Nikki and I were in London a couple weeks ago just thinking about like what are some like different ways that we can really start uh getting the ball rolling at time of mainet launch. Um and a lot of it draws inspiration from how we were thinking about um KPIs at at the chain level going forward with um uh with

increasing our floats. um at the end of the at the end of the day like a lot of people um operate on a very kind of short-term mentality of okay let's just get to this one point and then um in the case of like traditional like KPI unlock uh traditional unlocks it's like okay everything's just time based um no one's incentivized to do anything um here it's a great way to actually get people to interact with the products care about the thing that that's actually being shipped today which is the hard work that Le and Elong have been putting into mega itself over the last two three years um so we want to make sure that people don't see these as two independent products be the token and the chain but rather have one tie well like very deeply into the other. Um so that was very much the thinking. Um how

do we actually overcome the cold start? How do we help these teams find initial set of users in terms of applications? Um and then again a lot of that um is some basically like big gats additional activity on the chain and then you create this flywheel from there. Um and we plan to just like um accelerate this also um post mainet launch uh post token launch with um our mainet campaign. So uh we definitely want to keep um the activity going, keep people using the chain and again like success for us is making sure that we have our killer apps. We have experiences that bring people naturally back to Mega. Um so that's going to effectively what we're going to continue doing.

>> Epic gentlemen, thanks for being with us on mainet day. I'm sure it's absolutely insane on the internal Slack. I think I saw one of Shuya's tweets about um agents being so active in the coding process, Lei. So, I'm sure you're you're you're very deep in terminal and cloud code and anything else that's happening, RPC management, customer management, apps, uh users, bridging. So, we'll let you guys get back to it. A big congratulations to you all. Uh it's been a it's been a long journey for you and uh this is kind of like a new day one even though that's a that's a base saying it very much is a a new day one.

>> Really appreciate you guys. >> Thank you so much. >> Absolutely. Thank you guys. >> Bye now. Thank you. >> See you soon. >> Bye. >> All righty. Mega ETH is launched as proud Fluffle owners. Um pretty pretty stoked to see that thing go live. uh also a part of the good idea ventures portco through a lovely uh friend and yeah guys I mean that is the mega eth launch I mean I think everyone is ready for for the token I think what they're doing with regards to not launching it instantly is the right move um but we'll see we'll see the appetite for users on chain I think right now is probably the

one of the hardest times in the last two years to launch a new chain but I if you can nail that launch, it's also extremely strategic timing. And so there's like different ways to kind of look at it. Um, [clears throat] >> the main the the main um obstacle that I think Mega E is going to have to overcome is really they're competing with L1 at this point. It may not seem like it, but >> you know, I I think for a while they're >> that sounds bullish. L2s were like, "Hey, Kumbaya, we're all Ethereum, >> very DEI, you know, and and now it's like now Vitalic comes out and it's like, hey, if your L2 isn't really doing anything

special, get the [ __ ] out, you know, like >> yeah, >> L1 is scaling. No one pays high gas anymore. You can actually do things on L1." Yeah. So, can you do the things like you can't do billions of transactions per second, but you can do a lot and I think >> people still value the security of the L1 and so mega is going to have to, you know, they're going to have to create some use cases that supersede the scale of L1 in order to provide something unique. Yeah, I mean we did we did see um and and we did hear I did see a lot of cool applications in Copenhagen this past summer and we did hear a lot about some interesting ones as well from Amir.

So shout out to Mega E. Congrats guys on on the launch. Uh guys, if you're watching on YouTube, toss a like, toss a subscribe. I see you guys in there. Um we got chat on YouTube, chat on Twitter as well. Um it is Monday, February 9th. We got a lot to talk about. Uh so we're we're going to roll into um our our new segment of the day before our stabled up episode with the CEO of Liquidy and roll into all of that. And then we've got uh our intense day special being rewritten uh here talking privacy with Ilia, with Ellie and with Joel from Dash from Mer.

I I'm excited because this is following all of the clawed code like privacy leaks that have you know happened as a result of credentials and API keys being hooked up to open source software. So it gives us a lot more to talk about >> before we have our privacy panel and our stabled up episode. Let's uh let's see what's happening in case we missed everything is always watching. All right. Yeah, let's go. Um what's up N guys? Uh crypto stocks enter full capitulation guys. Crypto stocks plunge. This is Friday. Micro Strategy shares down 80% from record high. Fall to 100.

Uh Coinbase down 68% from record high, below 150. I sold that at well over 200. I was glad about that. I still have quite a bit though. Uh Coinbase is now trading 166. That low tackled at 145 Friday. Robin Hood down 54% from record high. It tapped 72. It's at 88 now. Uh all these are bouncing today. Galaxy down 64%. Circle down 84%. Bullish down 80%. MARA down 70%. Gemini down 85%. >> Gemini is this >> ESP down 95%. Full capitulation. Yes, Clipper dude. In fact, it is. BMR down 90%.

Wow. >> I mean, Galaxy bottom at 16. >> 21 Capital down 90%. I mean, you got to think that these are buys at least for a shortterm bounce. I mean, I'm not doing any of these like shorter term trades. You guys know that I'm heavily in uranium right now. Uh, and just kind of chilling, waiting in uranium, copper. My gold and silver positions look great. Obviously got my long-term never sell Bitcoin and ETH, but these stocks are wrecked. I mean, >> I mean, what a reflexive flywheel on these things. >> The gold and silver positions looking great is is a whole another conversation. Those things went for a whirl. But this is the new altcoin complex Andy.

>> You're looking at these are publicly traded stocks. These are tickers on the New York the NASDAQ to New York. >> Insanity, right? Insanity. >> These are down altcoins sized percentages. >> This is the new altcoin complex. >> Micro Strategy had to have been bottom there at 100. That is insane, man. That is nuts. So, yeah, guys. I mean, that happens over the weekend. Um, we're getting a bounce now. Again, we're not really too focused on trading these things. Um, it's just kind of insane to see the moves here from uh from these. I mean, yeah, like these things have huge market caps.

>> Yeah. Yeah. I This is Wow. >> It's a great time to build because there's an actual pathway to build a massive company that can go public in all of the same ways that a typical startup to series A, series B, C, D, all the way to going public typically does in IPOs. Yeah, I mean Bitco right like Bitco is is live on the on the on the NASDAQ or on the NYC. They've got um you know they're they're bit they're down only from launch but that was another one that was like Bitco in 2017 2018 was a small company and they've really really grown. So all right guys, that's the that's the state of crypto stocks.

Um I mean look if you're a long-term holder I don't really think there's anything to worry about. Um we are long-term crypto bulls. Uh again, there will be a lot of I mean it that was a really hard dump. Soul hit $68 on that dump. Um pretty nuts. So we we'll see where we end up here. >> Hard. I mean, Bitcoin got into the 50s. >> So 58 59. It's back up to 70. So it's always tough to catch knives, >> you know, that especially if you're doing anything on leverage. So we we stay off the leverage around here. Stay off the short term.

>> Take it easy. Don't get shaken out. And uh >> let's move on. We know we're in a bare market uh because uh our lovely friends over in China are banning crypto again. >> So the reason that I think this is and they've banned crypto, you know, every year >> since 2017 they banned crypto. >> The reason I think this is relevant is because there is another headline talking about how in the last week we saw the largest difficulty adjustment of all time. So obviously Bitcoin, you know, it has to get mined. It's proof of work. And so if miners go offline, difficulty will adjust, meaning that it becomes easier to mine Bitcoin. When people drop off, there's less hashing power. The difficulty makes it easier

for that remaining hash power to find Bitcoin. Um, this obviously had an impact. I think there's two things that led to the difficulty adjustment. I think China uh had something to do with it because they did uh they did compound the the uh decrease in prices with this with this ban. The second thing >> is that we're seeing miners sell Bitcoin to fund new AI uh data centerouts. >> Yeah, >> this is something I anticipate will continue at especially with Bitcoin at these depreciated levels. Bitcoin is they they had reserves and so they rely on selling those reserves. If all of a sudden after, you know, in a 48 hour span, their balance sheet takes a

massive hit, they're no longer able to operate profitably, they have to either shut down and sell their equipment or pivot and sell the Bitcoin that they have. And and this machinery, they're not shutting down. The point is that they're not shutting down the machinery because it can be uh repurposed to provide compute to AI and >> yeah, >> monetized that way. So >> yeah, >> I I I think the mining complex is something to watch um going forward. >> I mean I think that's part of it, right? And I mean with regards to this news, um all domestic entities are banned from unimproved crypto issuance. Internet and technology companies are banned from offering crypto related services. The

the central bank of China confirms that real world asset tokenization is banned. Um they must Chinese entities must get exclusive explicit regulatory consent before offering Chinese uh services abroad tokenization abroad >> including stable coins. There was Chinesebacked stable coins that they said are not official money. >> Yeah. They will have strict supervision any domestic firms pursuing offshore RWA tokenization and it basically shuts down any remaining gray areas around crypto and RWA tied to China. Um, so yeah, I mean, what's new there? Um, what's new there? So, >> yeah, let's get to our next headline because I think this is where the meat

of uh the mechanisms that cause the unwind, at least this is the leading theory. >> Um, we're first we're going to start with a few theories as to what and it's not just, you know, it's not just one sizefits-all. There is a combination of things that are happening here. And so from our guy over at Flood, a fellow hyperlquid bull. Yeah. Um describes a few theories and it's probably some counter, you know, some combination of all of these with varying weights and impacts. But uh he says that selling appears forced and indiscriminate, non-discretionary, meaning that you know there was something that caused this. It wasn't just everyone uh you know there was consensus that the tech is worse.

This isn't product market fit. You know there was something that caused this unwind. Uh the price action suggests that balance sheet uh driven liquidation not sentiment. Again you know there was something on the balance sheet that caused a liquidation cascade. Uh this could be a result of sovereign scale dumping 10 billion plus uh exchange level failure or e emergency unwide could be ultra wealthy family office liquidity crunch. This is now the leading theory is this next one. the risk of hidden leverage via IBIT ETF uh with growing borrowing against ETF exposure uh and uh too big to fail banks. Um >> it it feels like systemic deleveraging not a normal crypto draw down. And so I

think the next tweet actually sums this up and really digs into the nuts and bolts of what the IBIT overlever uh what it was made up of. I've seen varying things. I saw something so wild said that Tia and I were tomorrow and then go and dig deep into silver. >> Okay. Yeah. Let's pull up the next headline cuz I saw this as well and I thought that this was going to be uh particularly interesting. So TLDDR here guys is IBITS's highest ever volume traded um 10 billion uh today which I think was last >> that was Friday >> Thursday. Friday um 900 million in IBIT options premium traded also an all-time

high. Bitcoin and Soul were sold off just, you know, band forband in lockstep. Um, and there wasn't that many liquidations on centralized exchanges, right? >> Like it it wasn't exactly an on exchange leverage event. The evidence here, >> not the exchanges that we're accustomed to, the centralized exchanges. >> The evidence suggests that the stress centered on one or a few a handful of large IBIT holders, not spot bitcoin markets. Right. >> Um, IBIT has now become the number one venue for Bitcoin options. >> Uh, implying that there's probably some options driven losses that happened here. Uh, some of the 13 F filings show single asset funds heavily concentrated in IBIT, some at literally 100% of their

of of their holdings. And many of these >> we are going to just just real quick >> real quick. We're going to see the 13F filings come out um I believe it's in five days. I think it's this Friday. And so this is all hearsay speculation right now. But what I like about this theory is that when the filings because IBIT is a publicly traded vehicle, we're going to be able to see the economics of who holds a large uh position in IBIT. That paperwork is going to come out, I think on the 14th, either this Friday, shortly thereafter, and then we will get confirmation or a rejection of this theory.

Yep. Um, well, I I mean I can continue. >> Yeah, I mean there's just a couple things left to hit there, right? Like it's probably a Hong Kong based non-crypto hedge fund running levered IBID options. And if that's the case, then they just got absolutely BTFOed. Um, silver had a huge negative day, right, that that week. So did gold. Also, the yen got, you know, had a crazy unwind. Maybe there's a carry trade there. Yeah, >> perhaps this was something that was uncorrelated to crypto but then led to them having to nuke a lot of their IBIT position to cover their losses in other sectors. I think that was part of uh what happened here. My thing here guys

when it comes to this stuff is this always happens. Like there's always an explanation for why the market went up or down. Like there's always is. And it's really funny if you look at the four-year cycle. This was just this was just what happens. You dump, you get a little bit of a bare flag. Everyone's excited. We're going back to test 107. Then you dump again. Now, maybe we shouldn't have dumped this 58K. Maybe this was a bit exacerbated for whatever reason. But like my now my bigger thesis now that supports the reason why I've been bearish for the last four months is this is not going to go away. When Bitcoin goes from 98K 97K to 59K in a

matter of like five to 12 day I think it was like 12 days. Somebody just [ __ ] up. Like what about everyone who bought Bitcoin on the DATs at over 100K? What about everyone who bought ETH over four 4k over 4,500 in their DATs? What about Simmani's Ford industry company who bought their ETH above or their soul above 230? Like what are they going to do? And then what about everyone else who was running some sort of levered operation relying on Bitcoin to stay above 80K because it was in a super cycle. Like it may take some time for it to come out, but like there's bodies from this. And so my preference on the market is to kind of

let this unfold itself because I think it will unfold itself over the next several weeks to months. It may take three months, may take six months, may take longer. But yeah, that's generally my take is that look guys, there's not a rush to like [snorts] like I I don't see a big rush to like FOMO back in and think that you know this is going to cause further damage in the market. And I I just think it you have to be aware of that. >> I I think also there's different types of traders out there. Um you know there's some people that are going to look for value um and you know once you got into the 60s and the 50s might have pulled the trigger and you know at least right now that's a good buy. Then there's other people that you know are

going to look for confirmation before pulling the trigger. Um it it you know all depends on time horizon, personal you know uh positions and and personal um you know criteria as far as when they're getting bullish, what their what their timing looks like. Um I I want to mention something about IBIT here. Aside from you know personal trading I there's a real issue with not just IBIT, it's Micro Strategy. Um, it's all of the derivative Bitcoin products. You could even put Wrap Bitcoin in here. Um, these don't all correlate to one Bitcoin.

People buy IBIT to get exposure to Bitcoin. Um, you know, Micro Strategy, people buy to get exposure to Bitcoin and Micro Strategy has been buying a lot of Bitcoin but there are more than 21 million Bitcoin out there in circulation. I if you know what once you look at the amount of money and the amount of contracts that are being traded um what people are attributing to like one bitcoin equals one bitcoin ibit does not equal one bitcoin micro strategy these are all options paper derivatives and contracts of underlying bitcoin and you see more and more of these products come out onto the market and if the

money that went into these products went into Bitcoin itself, we would have gone a lot higher than 125. I'll just say that. And so what what what mean that >> all these DATs as well, etc. >> All these DATs, all of these derivatives, all of these options and and it just goes to show that there is demand for exposure to this asset. >> Yeah, of course. >> But we have an inflated supply >> and I think people are [clears throat] realizing that >> these things are not the same. >> Yep. Guys, we've got our next guest for Stabled Up, our episode 20 of our weekly stable coin show powered by our friends at Fracks. We're going to roll into that. We're going to take a quick standby, quick commercial break. Don't go anywhere. If you guys are watching on

YouTube, stick around, smash that like, hit the subscribe. We're we're live every single day. We're going to New York City in less than three weeks with the one of the best studios I think in all of crypto media covering everything that you want to hear about in NEO finance, in crypto, and more. Guys, we'll be right back with our next guest, Michael, the CEO of Liquidity to talk the state of state of stable coins in Q1 2026. Be right back. [music] Yeet is built for big moments. The most fun you'll ever have with your crypto.

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Havachi is fast and [music] private per trading secured by ZK with Celestia underneath. Go to habachi.xyz to start trading today. [music] [music] Welcome back to another episode of Stabled Up, our premier weekly show covering the ins and outs of digital dollars, stable coins, and the future of decentralized finance.

>> Show is made possible by FRA and FRA is powering the financial engine of the internet, powering FRXUSD and genius compliant stable [music] coins. This is the stablecoin super cycle made possible by FRA. Now enjoy Stabled Up, our weekly stable coin show. All righty, guys. Welcome back to Stabled Up episode number 20 powered by our friends at Fracks with FRXUSD, Frack Net, and more of their awesome products. This is our weekly premiere stable coin focus show for investors interested in NEO finance, in the rise of stable coins, and in DeFi. We've got liquidity CEO Michael Savvada. uh he is a friend of the show, a longtime friend in DeFi since probably 2019. Uh we were all on

liquidity back then. Uh they have been very resilient and strong with LUSD now bold and their uh CDP mechanism which has uh been around for some time. Michael, welcome to the show, man. >> Good to have you. >> Thank you Andy and Robbie. Nice to be back. >> Absolutely, man. Since 2019, things have changed a lot. uh stable coins in particular have really uh have really I mean just taken the entire market and and brought it with it. Um I'm just curious as far as like maybe the top just tell us a little bit about you know what it was like back in 2019 and and you know give us a bit of the chronology like tell us a little bit about the story about ultimately how we got you know from 2019 to stable coins in 2026.

Yeah, I mean Maker was really the pioneer, you know, to pioneer a stable coin on chain and then Robert who founded liquidity saw maker was fascinated and and just said hey we uh I think I can do a stable coin without governance um without interest rates and with higher loan to value. So he created that that was the version one the LUSD back back in the days had five billion in in TVL. Um and then all started then we said all kinds of experiments also algorithmic stable coins every everything went crazy and now I think we we see again the the consolidation of first kind of we we saw

them really this adoption I mean stable coins being the defi killer use case and I think now we're entering stage a bit of consolidation and consolidation I think in two parts in in in the consolidation of the model. So, you know, I think I watch your show and you have so much content on stable coins, but actually mostly we talk about these regulated threadfire stable coins, you know, the genius act kind ones and I think they will become a commodity will be interesting how they differentiate and there will be a lot. I'm not saying that there will be only two, but I think everybody will gravitate toward that model and I think something you haven't talked much about and hope we can deep dive today a bit is the other model.

It's like talking about the car with combustion engine and we haven't talked about the core with with the electric engine having stable coins that are not linked to the banking system. So like the original die and maker and they are a really tiny fraction but but I think um they provide really unique benefits and will also survive in in a very decentralized way. So that's my point. I think we'll gravitate to the these two models >> fully regulated um commodity and this purely decentralized >> and I think in between >> there you have the trust me trust me bro zone [laughter]

>> yeah you're adding trust you know you're adding a multisc you're adding a yield source you're making that a hedge fund you're adding risk and risk and risk and hopefully you get more yield but there in between it it gets just more >> difficult you know because then with regulation what are you doing here? So actually you probably should be rather regulated and that's to close the I think until now we have seen the full range and I think in the middle it will clear up and we'll see these two models. >> Okay. So we're going to see this bifurcation of these two models on on one hand I think everyone because you're right we've talked about it a lot on this show this genius compliant fully reserved regulated model you know you can think the circles and eventually the tethers will probably get genius

compliant fxusd is also in that regulated bunch on the other side you know I I think if we think back before there was a genius act it was die and it was it it was you know the decentralized stable coins that you know we were very accustomed to but If you look even if you look at maker you know they've gone from die to more focused on SUSD right with sky. So give us you know the bull thesis you know because combustion to digital or electric feels like you know an upgrade. What is the benefit of an unregulated but fully decentralized uh onchain stable coin?

>> Yeah. So it's a sovereign or a freedom stable coin. I mean that's what blockchains are about. If you look at what are these Genius Act compliant stable coins, they are run by humans, backed by Treasury, controlled by nation states. And that's why they need to be regulated. Hey, there are humans in there. Okay, they make mistakes. They are fraudulent. So let's regulate. The other category, the sovereign stable coins that are only linked to crypto, so no ties to Trefy or run by code, backed by crypto, and controlled by its users.

And what kind of value proposition does this give to you? First, I think there are three dimensions. First of all, you're not being exposed to threat risk, counterparty risk, um collateral risk, custody risk, operational risk, legal risk, jurisdictional risk, you name it. So, you have now really a stable coin where you can diversify your portfolio with a totally another risk profile also an uncorrelated yield because it's not coming from treasuries. So that's the first pause, not being exposed to threat risk. Um, then the second part is you get more control as a user. So you as a user can instantly mint and redeem with a lot of stable coins. You need to be KYC, you need to be a business, you're

in a queue, yada the other. You have strong property rights as a users. Um, the stable coin can't be frozen. There is no blacklist. Um, that's kind of guaranteed. and the ma mandate in our case because I think liquidity and ball is really that's why I said on on the edge how much we can today decentralize the stable coin of course we could even do more in the future like vitalic has outlined but that's in the future so we have also a immutable mandate so you get very strong guarantees that the mandate isn't changed or that today we make a carry trade strategy and then we form stable coins so you get more control and the last one is better transparency everything is on chain 247 verifiability, you have the

predictability and peace of mind because you as a user don't have more information and control than me as a CEO of the company that developed it. So to sum it up, you have really a stable coin that you know that acts in the best interest of the user. >> Yeah, Michael, I think you raised a great point um with regards to the three uh three kind of uh characteristics here. I think Vitalik just answered to uh a friend Code with regards to his tweet about there's no reason to use DeFi unless you have longs on cryptocurrencies and want to access financial services while preserving self-custody. Quite a reductionary take.

And then he said in before my USDC yield that's not DeFi. And Vitalic wrote back and he said look would algorithmic stable coins fall under this in my in my opinion no algorithmic stable coins are genuinely DeFi. He says the easy mode answer is if we had a good ETHbacked algorithmic stable coin then even if 99% of liquidity is backed by CDP holders who hold negative ALGO dollars and separately positive dollars elsewhere the fact that you have the ability to punt the counterparty risks on the dollars to a market maker is still a big feature. The hard mode answer is even if an algorithmic stable coin is backed by RWAs if it is overcolateralized and diversified to the extent that it would

still be collateralized if any singlearted way failed i.e. if a max share of any individual backing asset is less than the over collateralization ratio so is you know properly balanced then that's still a meaningful improvement to the risk properties experienced by a holder. Uh he goes on to say that basically putting USDC into a gadgets do not qualify under either of my categories. Uh and then you had Stani respond put ESGO into a is the right fit and you know people start to shill their bags in there and stuff. But talk to us about kind of this um like like what is your initial reaction to this from Vitalic and C nodes USDC yield not being DeFi and this suggestion of kind of uh Rway collateralized algorithmic stables

or general ETHback algorithmic stable coins. I know this kind of flows into your bold um product that that you have probably trying to answer this question. What is your reaction to to uh Vitalik's take here? I mean, in general, I think my point is it's great that we have the options. You know, I also really like Genius Act stable coins. A PayPal dollar is such a great product because it's much better than your bank deposit. It gives you much stronger guarantee. But what is traditional stable coins added which are actually a government market money fund is DeFi also leverages them, gives them new rails. They have now digital rails.

So they are more accessible and you have the modular modularity which is also great you know and you can also add and rwas you can add transparency so the the whole blockchain layer can add more stuff to it and I think on the end where liquidity is I think we are taking to the full extreme as far as we can go to create an Ethereum dollar which I think Ethereum is is a freedom technology so kind of how much how can we give as much freedom as possible to stable coin holders um I think that's then um liquidity and bold and I think the good point is either what is better or worse is the people now have the option to opt out of the threat part um and and be able to shift the risk. So I think

that's really the advantage and rather than pick picking on each other, we should just make sure we have these two options and honestly the the the Ethereum dollars I mean there are other projects like curve and and and others that um is just a two small fraction of the market rather we should really make sure these options are there when we need it because again you know kind of is a sovereign dollar but that's not a company coming and delivering that to you. So it's also a bit freedom always comes with responsibility and also [clears throat] for the risks you know I'm not saying they are risk-f free they have technical risk they have oracle risk um so that's why you also need users that that use it but I think the

cool part is and I think that that was initially why I get in touch with you I think it was really cool to see blue chip that rates the stable coins so bold was the only one rated A or a minus but the only one without counterpart the risk playing in the thread fire angle. But again, you know, that makes it great that we say we have two options. Uh both can be safe depending on what you would like to trust rather humans and regulation or rather code >> and they they provide you now options. >> So, so you personally believe that Ethereum and LST backstables are the more resilient path long term then?

>> Yeah, I think they are more res resilient. I think the the traditional stable coins probably will always bigger, but but I think to having a stable coin that is sovereign um that people can use and nobody can take away that you have control over and that provides an alternative uh to for example genius stablecoin is interesting as you know you know the financial system is also a weapon I mean you you can sanction a journalist because he has an unpopular opinion and I think that's the ethos of Ethereum that's why we have this great technology and if you want to use it to the fullest extent I think then we are in the world of liquidity and bond and if you say the technology is also great to be used as rails and to modularly piece together but this um

still means these are totally traditional products that are just kind of have a digital pointer if you see it in your ebanking this govern market fund or on the blockchain actually isn't that much of a different product so that's what I want to highlight just to say that's why I electric core and combustion engine, it's another thing. But at the beginning, you didn't have kind of all these power stations everywhere to power your electric car. So, there were some downsides. But I think it's also important to highlight the optionality, the different risk profile, the encore related yield. And you know, besides the rating that you can say it's equal um for example, bold performed really well.

it had six to 8% since you could earn since May last year because of the liquidations recently last 30 day 8 to 15%. So also the safety risk profile kind of you you have these options and I think that that's >> um yeah I think that's really an important message because probably not a lot of people are aware that not every stable coin not every dollar is created equally. >> Yeah. Yeah. And you know with with the risk profile the you know the the other side of that coin is going to be the the the reward profile right which I I think is just as as important to talk about because we're we're seeing this new sort of design space for these yield coins

now. You know, obviously in DeFi, we've had yield for a long time, but I I think people were a little bit tired of, you know, where the yield came from emissions. You know, fees kind of dried up when activity was down. And then also as some of these things scaled, the fees actually dried up, provided less yield. You know, the the traditional uh you know, Fed and money market rates have something to do with this as well. And so what were something to do with this as well? And so what we're seeing now is this cohort of the USDAs of the world, the daylights are going into AI. They're providing credit. They're taking that credit.

They're giving the interest, you know, and taking it back to shareholders in in terms of their token holders of this of this yield coin. Same thing where, you know, we're seeing companies go into other industries, uh, have real business models, and then take fees from those industries and bring them in so that we don't need to subsidize yield with token emissions and and inflation. And so when when we're looking at the risk profile, I think you explained it extremely well. As we think about the reward profile of, you know, the the two groups of stable coins that you mentioned, are we are are we available is is the same level of yield and rewards available to us as we're exploring some of these, you know, sovereign onchain uh stable coins?

You know, if we keep something that's stable and onchain, are we foregoing all of these exogenous sources of yield? >> Good question. Why do they need to be exogenous? If we have our sovereign stable coins, why can't we have our own DeFi rate? So, I can explain you how how gold works and where the fees are coming from. >> Sure. So, so as a as a borrower, you can deposit your collateral ETH and mint the stable coin and you pay a borrowing fee. So, there you have the borrower and who's the creditor? Okay, you could say the protocol, the protocol just mints the stable coin, but actually then the stable coin holder who buys the stable coin is the creditor. So, what you

created is a market. What liquidity creates is this market and actually it's peer-to-peer finance. And the only I think reasonable thing that needs to happen is the borrower should pay the stable coin holder because he gives him the credit or holds the stable coin until he wants to pay it back um directly to him. So what liquidity does it funnels 100% of the revenue to the stable coin holders and connects this market and this is a very sustainable predictable yield. If liquidity would be big enough probably the reference rate would appear because liquidity is also the feature that the borrower sets its own users own rate and the he of course needs to set the rate in a way that people would like to hold the stable

coin so kind of then this rate um gets adjusted but what I wanted to say there you have this totally organic sustainable yield and you're creating a very efficient market for borrowing and and and stable coin yield by just connecting the people and I think that's what Ethereum is great for. I I really love this peer-to-p peer finance solution and again you know that's why I think not being regulated is not something bad because they are directly interacting with each other. So kind of who do you want to regulate? Shouldn't users be able to kind of do their finances like we have done for hundreds of years before banks emerged?

>> Yeah, I I >> I hear you on that. But like um the answer to to to why people would want just a basic RWA backed stable coin like a USDC or USDT is just trust. It's just this is US treasuries. You're holding this dollar. Um you know it's backed one to one. There can be like people have such PTSD of pegs of stable coin pegs. You know what I mean? >> Yeah. And I understand it and you know I'm not not saying anything against these Genius Act compliant stable coins. Like for example, the Paxus setup is great. It's amazing that you can access this treasury yield in such a safe way.

As I said, it's better than every bank and you should be able to do and maybe also other products, but these are traditional financial products. So all these things need in place because all these uh mistakes will be made. That's why I said it's still the trust me bro area. Yeah, >> traditional products if they brought on chain in the normal way, that's great. You get direct access to it. And for people that like to have that access, I think that's cool. And I'm not saying people should shift, you know, for for whom are these sovereign stable coins. And I think there there are three people. People that are um really self-serving individual that say, "Hey, I want to have >> control over my dollars. I don't want to be dependent."

you have um low-risk DeFi yield seeker in our case because you don't have a lot of risk that other protocols with integration with bridges and so have say okay I'm in DeFi I want a good risk adjusted yield and then you have the last point maybe treasuries that want to do risk diversification so I don't say shift everything but maybe say hey as a hedge I have all these um same stable coins with the same risk profile having five 10% in another risk profile with an uncorrelated yield with other properties and other rights and maybe a direct if backing could be appealing to more cryptonative users. So >> yeah,

>> again I'm not saying that your mom should hold that. I think that's kind of the traditional products are better, but for these more sophisticated user I think it could be an interesting play to have this option. >> Yeah. >> Yeah. I I have one one quick followup on, you know, where this and and low risk yield, I think, like you said, eight to 15% in the high volatility, you know, six to eight% is extremely good when we're talking about riskadjusted yield. a as we're thinking about, you know, what is possible in this in this space, I I I can't help but think that one limitation here is that, you know, if we're lending to some of these, you know, these other sources like and and we're looking to drive some interest and yield from those sources, one limitation

is the collateral universe, right? Because I I think a lot of like traditional businesses, be it crypto businesses or fintexs or traditional, you know, industries are looking more at, you know, they're they're being lent credit and and a lot of times it's just based on their cap table, right? And their existing balance sheet. Maybe it's against their future cash flows. And so a as you're thinking about, you know, someone wants to get credit, um maybe they're not interested in uh having exposure to ETH as their form of collateral. You know, maybe they they have their their other assets or their own equity. You know, h how much of a limitation do you think this could be to, you know, the sovereign ETHback

stable coin uh complex? >> You um raise a good point. I mean these sovereign stable coins that are fully backed with crypto they don't grow as easily and in such a scale as the treasury backed but I think that's also not the goal to out compete. I think it's really the goal to have um these options and of course you can also introduce like private credit stuff. I mean these things are all done or hopefully well understood but need to be managed well. There are sometimes I have my questions mark because now you have just kind of some people doing traditional business where you just need to understand the risk and manage that properly. I think that's a bit difficult

but if it's managed well yeah then it's great because again if you bring it on chain you have the access you have the composibility of these assets which I think um is a great feature but the other thing not to underestimate I mean I I outlined the the value prop for the users you know fire risk uh more control transparency but also for us on in the ecosystem we need to be aware that every time we hold such an endogenous yield source we are funneling our assets into the threadfy banking >> to just get the deal. You know, the bull case would be for example sovereign stable coins and stuff that is backed by crypto. Uh yeah, if you just move 5% of the stable coin supply into these sovereign stable coins with crypto

collateral, we will move 15 billion in in collateral on chain again. Um [laughter] so that that would be the move for our bags. >> Yeah. Um guys, kind of shifting gears off the types of stable coins, which I think that we've pretty much uh solidly established on stabled up this year and last year. These two different types, Michael, I think you you know, you explain it quite well. Um we've also just seen a really big boom in stable coin uh B2B payments. So thinking about things from from the state of of quarter 1 2026 and stable coins in January stable coin transaction volume according to Artemis actually surpassed 10 trillion dollars. Um USDC uh processed

over 8 trillion, Tether around uh two trillion or one and a half, two um and then kind of like the rest around there. Uh just kind of filling in that last couple percent. Guys, that's massive. That's 10 trillion dollars of stablecoin transactions in a single month. What do we think is the reason for this stable coin transaction volume? Are we seeing just a rise in neo banks in this neo finance category? Are we seeing more and more um payments from B2B perspective?

Michael, what is driving stable coin transaction volume to reach over 10 trillion in January? And what do you expect to be the key drivers of stable coin transaction volumes throughout the rest of the year? I think it's it's a very tricky question. You know, already understanding what happened in 24 and 25 because you only see part of it. I think until now stable coins were mo mostly used in the background, you know, to move money between exchanges, market maker really an and bit OTC stuff. If you see how much is settled still on Tron. So kind of sometimes I feel we just think we are the main users just moving this money in and out of Coinbase or so. And I think that's that's not the case yet it it has driven a lot of

volume. What what I expect because now a lot of players has have the infrastructure in place. For a long time these players didn't have the infrastructure to receive stable coins and send it. So I think we we'll see um a lot more of these use cases and I really like you know when I think of the future I think we have Tether they are the incumbents we have USDC they have also great position but we already see they need to give away a bit of their yield to Coinbase and then I think you talked also to bridge and stripe I really like that model that's what I say stable coins are a commodity and then they give away the yield so I think and and it's really difficult to say What kind of business model will be possible

if people can get the yield? And it's about distribution. We see it with hyperlquid that gives some of the distribution back and then you have these players that have huge distribution bases. But then the question is how will they form it? Maybe you know we will see a comeback of the consortia chains just like we saw base had had just because with its customers such a base big base but everybody doing its chain it's different. So the next thing would be that big players with big distribution could go together. So I think it's really hard but I think it's going to be who can make use of this treasury yield as long as it it stays quite high um because it's funneled through through from a player like bridge that just takes a cut which makes

sense and now I can build a business model on top of it if I get the aum and and so on and that and that's I think it's it's really tough to say. I have no clue and I expect a lot of innovation and a lot of failure. >> Yeah. And and what's to say about these stable coin chains, you know, as as we think through ARC and Plasma and Tempo, you know, h how do we think that the economics if we're flowing more stable coin transactions through those chains and there's collateral there, do you think that because stable coins are such a significant part of the DeFi ecosystem at this point, do you think that might pull stable coins off of like some DeFi venues and pull it onto places where

more stable coin volume could take place. >> Yeah, I think so. It's maybe something we underestimate. We just think, oh, it will happen on DeFi and it will happen on Ethereum. Why it's happening there? Because they have the customer base there. You know, a lot of people with wallets, but if you roll out wallets to 400 million users, two billion users that you have as a user base, it doesn't play a role anymore. And as I said, these are threat stable coins. You burn it here, you mint it over there, and they are gone, you know. And with these other chains, the stable coin chains, they have some interesting features, but at the end, I'm more a product guy, you know, I think you need to have the problem and you need to have the distribution. And distri it's really a distribution game for for stable coins.

And I think who can best position itself and and have really a strong use case will just um attract the volume and and he can dictate on which chain it will be because the chains with these traditional stable coins are really easily exchangeable. You know, as I said, I burn there, I mint there. Whoops. Stable coins are gone because anyway, they they are somewhere in a bank. They are not on the chain. >> And you know, I think some people are looking at at that and they're thinking it's a feature. They're thinking, "Oh, well, if I can, you know, uh, if you know, I'm Iran or Venezuela or like, you know, one of these like sanctioned countries, look at what Tether's doing.

It seems like every other week now they're, you know, they're, uh, they're freezing, you know, a half billion dollars of Turkish lera, you know, in in Tether, right? And I what you know, your answer to that is just optionality, right? There's there's there's >> Yes. Sometimes you have to pay a price also like >> freedom of speech you know privacy >> another man's bug [laughter] >> and if you say you can't avoid that this will be misused but at the end I think it's it's more important that we have these fundamental rights and of course you should go after illicit funds and and criminal funds and and whatn not and you should have law enforcement and you should be able to get them but you

shouldn't restrict the 99% of the others of their fundamental rights. And Michael, as a founder of a of a stablecoin product and just as a founder in general, when you see this like big shiny ball like this massive total addressable market out there, stable coins as a whole, regulated stable coins, how do you like what is your mental process to think to yourself, I want I'm going to stick to my roots. I'm going to remain true to like the the spirit of this project and despite what might be a bigger TAM, I'm going to continue to build the project that we set out to build originally.

Hey, it's really the passion that brought me in into Ethereum, being able to create this technology, put it into users hand, being able to roll it out worldwide. You know, it's not so easy for USDC. You say just think because you you print it on Ethereum, it's rolled out. No, it's regulated in the US in in the EU. So where is it regulated? Where can you redeem? It gets more complicated and complicated. So this simplicity to be able to um give this power to users, that's really what drove me into the space, what keeps me in the space. And yeah, that's why the other things they would be interesting if I say, okay, let's make the fintech play. And of course, it makes sense and could be interesting, too. But you know that really brought me out of the corporate

world where so we had the internet that I missed that a bit with my age and now we have blockchains that fundamentally take out the intermediary like the intermediary like internet took out the intermediary for media and communication. We can do that for financial intermediary. That's what brought me in. That's what liquidity is doing and that's why I'm so passionate about it and saying hey uh let's preserve that and and let's make users aware that this product exists. not forcing it on anybody, but just realizing that that's maybe something different. And for some people, it it has advantages or for some people that don't trust certain systems or don't have the privilege to live in in certain systems, um these can be valuable tools and that's really having this, you know,

I don't know about your job, but having this this higher goal, this this higher northstar, um is really an additional bonus. I wouldn't say that I won't do the other job but it's just kind of it it gives you really this energy to stand up in the morning and say hey how cool is that that we can build uh such technology. >> Yeah. Yeah. >> Important. >> Yeah. Michael, when you're thinking about this kind of evolution with the Genius Act, uh, you know, being passed and soon implemented, as well as the market structure bill, as well as just the general cleansing of a lot of the the, you know, typical bull market mania stuff that we get each cycle in crypto into a more, you know, you could say more of a slower, more of a mature, sophisticated phase, almost a coming of

age of the industry. These two things are happening simultaneously, right? like the the regulation kind of causing the coming of age in in its own way. When you're applying that to stable coins, to onchain businesses, to generating revenue, cash flows, this entire idea here, how do you see this evolution continuing to play out for stable coin companies? How are you thinking about um how regulation as well as this coming of of age and maturity of forcing onchain businesses to be the thing that that the market wants? uh how do you see this kind of convergence continuing to play out this year? What are some kind of thoughts that that you have from your perspective?

>> I mean what I like from the US that they make the regulation better than than the EU, you know, which is prohibitive, which honestly also made the the stable coins less less secure. You know, they need to hold more bank deposits. So I'm you also need to be aware regulation is not always to protect the customer. also the the the clarity act you know it's about how do you distribute the the the interest what's here in in the customer interest it's in the bank interest but it's fine you know half of it it's kind of regulation to cl clarify things but just to outline hey this is also a mode and here here it's also kind of protecting the incumbents so this is will happen

but I think it's it's good I think it's good that we have these um super sound stable coins we can use that we have the clarity that we also see now these players coming in. So we'll see that more and more that kind of the traditional stuff is allowed onchain and taking advantage of it and I think it will take a long time and we we we underestimate how long it will take because it's not just tokenizing something and then everything will be easier and you have a business case. These things live all still in the old system. So once we have clarity and we can bring these things natively if the blockchain is like the the primary ledger and not the banking system then we will will see a lot of advantages. So I see that coming it will take longer. I

think it makes a lot of sense. it will clear up this gray area we have I think which is in the benefit of all but the fear I have is um exactly that you know the things like electric cars the people say no no no that's dangerous and we should disallow it or oh they are self-driving you know we are self-driving credit facility that people say that's very dangerous and kind of restrict this peer-to-peer finance area and just because you want to regulate everything and I think that's my biggest fear that people don't understand it just see it as a danger or um or afraid of it and that we lose the niche we have and the freedom we have in DeFi. But that's not only the regulatory kind of

issue or fault. I think we also as a industry need to have higher standards you know from like a self-disclosure practice and just say hey we're doing that in our best interest and we we're a good example and this technology in that way should have its merits and people should be able to build and use it freely outside of a regulated parimeter parimeter or just in a different regulation like product regulation. Okay, you look is that product safe? Is the security good? But not do we need an intermediary to regulate if there is no intermediary.

>> Yeah. Yeah, man. I mean, I think I think this entire new era of crypto like what's happening is we're testing the bounds of the censorship resistance, the libertarianism, the immutability properties, all of these while converging deeply with the legacy finance world. And there's some line that is being walked right now where there's adoption in institutional interest allocation into the market while also not foregoing what we've kind of came here to build. And I think that line tends to swing in both directions uh as you as different events unfold and as different market uh kind of transitions happen. But it does seem

like right now it's uh it's a necessary evil to collaborate and to build with these largecale firms in order to get to the next phase. Like for example like having the ability to trade um you know tokenized equities on chain is like a really nice thing to do because it's it then is like the step to getting people to then come on chain to to trade their equities uh 247. like having these, you know, stable coins that are backed by USDT or sorry, by treasuries, etc. This is like perhaps the step to get us to where you want to be in the future, right? And so, it's kind of hard to get excited about this middle ground because it's like we didn't really come here to tokenize dollars and stocks and call it like an industry. You know, we came here

to create new asset class and to create a new financial system. But it's it's very clear to me that there's this intermediate step happening right now which is of the utmost importance which is like basically doing the tokenization of a lot of off-chain assets as well as like facilitating uh a lot of that kind of gray gray line or gray area uh in between, you know, legacy finance and DeFi. And so, Michael, I feel like that's where we're at right now as as an industry. And I feel like it's it's up to the activists to continue to, you know, push forward their agenda and and I think the institutions are going to be pushing their agenda. It's almost like a David versus versus >> and and you know there there's a new arena as you said it's a evolution and honestly I think it's great also that

traditional players are coming in because the evolution is we had banking no you had just your bank and you were kind of captured in your bank and then we had open banking. know suddenly you could access FinTech could access your bank. >> Mhm. >> And now we will have open finance on this ledger and being able to piece all these things together and I think this in its own will be really great and and and we are just at the beginning. >> So really excited about it >> and and stable coins are the wedge and >> and the Trojan horse. Uh Michael, man, really appreciate you coming on. It's a it's a pleasure. I mean, you've been building since 2019 and so uh we should do this a little bit more often than than every five years.

>> Yeah, sure. Happy to do that. Hey, it was great to meet you. >> Thanks, Michael. >> We'll see you next time. Matt, >> good to see you guys. And thanks, guys, for being a part of episode 20 of Stabled Up presented by our friends at Fracks. We'll take a quick commercial break. [music] Yet is built for big moments. The most fun you'll ever have with your crypto. Go to yeet.com [music] to yeet into your next game.

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>> [music] >> Havachi is fast and private per trading secured by ZK with Celestia [music] underneath. Go to habachi.xyz to start trading today. Looking for yield that stands out? Infinify gives you just that. Deposit stable coins and earn far more than the current savings rate. Infinifi is a battle tested, reliable DeFi platform that is ready to go. Head to infinifi.xyz.

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[music] Go anywhere onchain instantly with relay.link. Relay is closing in on 10 billion transferred. Go to relay.link link to bridge your assets. Now [music] talk to AI like your lawyer or your doctor or your therapist. Yours private and here today. Visit near.ai to have a fully private chat experience.

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link to bridge your [music] assets. Now, talk to a I don't know where Rob's at. [snorts] All righty, guys. Um, check this out. So, I think that uh our our guys at Tempo are literally building um what I would consider the Avengers of of crypto. I mean, I I' I've never really seen a team like this. They've got Dankra. They've got Dan Romero. They've got Georgios from Paradigm. They've got um the guy that hosts that podcast, uh Simon Taylor. I think he's like a fintech guy. Um they have an insane team. This is nuts. They just continue

to poach talent. Dan Romero, founder, recently sold Farcaster, joined Stripe and Paradigm backstable coin chain Tempo. I mean, this is the biggest competitor to Plasma. Plasma is a portfolio company of Good Idea Ventures, our fund. And yeah, I mean, this is a massive win for Tempo. I I I don't really know what to say. I mean, this is just that they they got Dan from Varcaster is nuts. This guy's a massive massive following. He has experience in product design, in building products. I mean, this [snorts] is just huge. I mean, Tempo hasn't even launched yet, but they've got a just a huge huge product suite um coming in and their their team is just dominant. I I

just looking at stable and plasma launches, the stable coin chain market is just like any other market. Like they're not like they're remiss from the rest of the dumpage across all different altcoin comp across the entire altcoin complex. Um, but I do think that Tempo has a really good chance to be um like the leading I don't know, you could call it like fintech chain or like kind of like web web 2.5 chain. So yeah, I mean congrats to Dan. Pretty sick. I mean Tempo is probably the biggest chain launch that's not yet launched after Mega ETH launched today.

I think tempo and arc probably go headtohead right right now. Circle's obviously building Arc. Stripe and Paradigm are obviously building um Tempo. And so yeah, I mean I'm pretty excited for what they're what they're doing here. And I just think that like they're kind of building out an all-star team and they're now going to be able to attract so much talent that is like really really compelling. Um and Paradigm is just a different beast of a force as well. So yeah, I'd be pretty bullish on this if I was an investor in Tempo. I think this is going to bring a lot of excitement to the market again. I just don't know like like how the crypto community is going to get upside and exposure in tempo.

Like I I worry that it's going to be one of those things where it's really bullish for uh a lot of the excitement for the early investors for the par for paradigm and stripe of course but that either they don't launch a token for a long time or they do launch a token and we still have that same token equity dynamic where there's not really a clearcut answer. Maybe that they they get around that. I mean I would hope so. I think at this point you kind of have to from the token launch perspective. Uh, but I just worry that they might just launch out a massive FTV and um basically get not a whole lot for the people that are excited about it and the people that were supporting it early on or just like general folks like you and I who want to get exposure to to this

stuff, right? Like we, you know, we were fortunate to get uh the investment opportunity in plasma um that has has performed well. Don't know really about tempo. So, not sure how we're going to get upside on that, guys, but we're going to figure it out one way or another. Let's move on to the next one. Um, we got Xtocks, we got Kraken, >> Rob's back. You can benefit from Chain Link. Yes, you can. Um, Chainlink was one of the the best launched companies back in the day, but uh right now, like any other project, it is on a uh public purchase basis.

Anyway, uh Xtocks, it's time to upgrade the market. They will buy Chainlink Dons for CCIP data compliance. Yeah, of course they will. Um, of course they will X stocks uh on on salon. This is how tokenized equities are meant to be. Deeper lending markets yield on your X stocks and more built for builders designed for everyone. Xtocks powered by Kraken powered by backed. Yeah, I mean guys are expanding to basically get into DeFi now. Like so now you see that that that they're all in all the apps that you use new

utility but now you can actually use them in Camino to actually get to lend out your tokenized equities borrow against them loop them. So this is kind of like the big um it's kind of like the big next step for RWAS on chain for tokenization. Right now it's like really cool. you can like, you know, go deposit some money into a money market fund and uh get access to yields um from offshore, you know, CLLOs's or from offchain CLOS's from uh money market funds. But the next phase is actually putting them into DeFi, keeping that off-chain yield and then getting deeper onchain yields and better onchain yields. So, I think

that's kind of where Plume's focused. I think Plume's pretty competitive with Camino here in X stocks. And so I think this is like that this is like that next stage for tokenization is actually getting yields onchain from off-chain assets >> and and it's not just about yield like people might be wondering how does this help quote unquote my bags. Now let me let me attempt to answer that question. people take, you know, let's say, let's say people are trading equities, right? And let's say instead of trading on their brokerage, they're trading onchain and they're trading tokenized equities.

Okay. Um, if those equities are of composable with DeFi, I can deposit something like an Apple stock or a Google stock that I want to retain uh exposure to and I can borrow stable coins against it. I can then take those stable coins and I can do anything under the world with those stable coins, including buy quote unquote your bags. So I I think when we think about what bringing these and and people are pissed off because they're thinking, hey, like how does this really help me, right? Like they are launching these tokenized equities, maybe they're doing so on a different chain. How does this end up helping me? Well, once they start, it's all about unlocking capital

and credit creation. And I think DeFi is really really great at creating credit for the the tokenized economy. Meaning that I can deposit collateral no matter the form. In this case, take, you know, tokenized equities as the form of collateral. I can borrow stable coins and now there's more stable coins in circulation for all everyone's bags. Go buy crypto. Go buy equities. Go buy gold. go buy anything you want under the sun onchain and you can do so because you now have greater composability between these forms of collateral, right? Is like we got a lot of tokenized tokenized assets on chain and now it's like okay now why don't we just actually

bring them into DeFi and provide more yields um and get better assets on chain. So this is like like my logical next step, right? It's like okay, we tokenize the assets, then we bring them onchain, we get these assets onchain into deal defy yields, we show these institutional allocators that there are far better yields on onchain to get on your equities. Like imagine somebody telling you you're going to get a yield on your on on your S&P 500 holdings. So like you're holding the S&P and you're actually getting yield from it, not just like holding the S&P. It's kind of like a breakthrough moment for investors who are looking for yields because most investors are. So that's kind of what I'm excited about. Guys, shout out to Xtocks. Let's keep it moving. I think the next headline is part of our N7

thesis here and part of kind of what where outperformance is happening in the market, which is Sky. Sky Protocol has executed $ 1.9 million of USDS in Sky buybacks last week, acquiring 31 million Sky. cumulative buybacks have surpassed 108 million USDs in buybacks. Uh so you can see the weekly update here uh from the team. It shows you the the weekly buybacks and so you know the the week of January 19th or 18th we got 102 million and then you see their incre So they're doing $2 million a week of buybacks.

It's very it's quite notable. Uh, Hyperliquid is doing, you know, couple million dollars a day of buybacks, but is also trading at about 25x or 20x to multipleish of Sky market cap, fully FTV, uh, fully diluted valuation. Sky is a big part of the N7 bucket that is leading right now, guys. We're going to be releasing that dashboard for the public very soon, and we've been kind of getting feedback, testing it out. But, I mean, this is like pretty pretty insane. the the token is also outperforming pretty much any other altcoin except for hyperlquid in the market and Canton which are also part of our N7 index. So what's cool about what's happening right now is that our thesis on NEO finance is actually outperforming the market within

all of a month of launching it. So we're pretty excited about that. Um and we think it's going to continue to do well. Hyperlid Sky, Maple, Canton, Etherfi, a Morpho, even Pendle, even though they have quite a bit of investor overhang still, um these assets are out outperforming. And then you've got kind of other NEO finance assets that aren't doing as well, but we expect to get, you know, eventually be we'll we'll bring them in or swap different ones into our our index as our thesis changes. Uh but maybe we will be we'll be able to launch a vault for this index and for this thesis yet to be seen. But shout out to Sky.

>> Shout out to Sky. I don't have a whole lot to add. I believe in Sky. I think they're doing great. I think we're going to get Rune on uh another time very soon. And I like the buybacks that are happening here. I think Sky is one of the few business driven projects out there and they've already got plenty of product market fit. So I think among uh crypto tokens, they're shining because they have a business. And even amongst the tokens that do have b businesses, uh they're one of the few that is continuing to grow.

>> Most definitely. All right, guys. I think we got just one last one before we roll over into our uh intense day special. Why don't we just take a quick commercial break and get those guys set up, get them ready, and roll into our last part of the show today uh with Ellie, Ilia, uh Joelle, and potentially Merch. Um, see you guys in just a sec. Yeet is built for big moments. The most fun you'll ever have with your crypto.

Go to yeet.com to yeet into your next game. [music] Go anywhere on chain instantly with relay.link. Relay is closing in on 10 billion dollars transferred. Go to relay.link to [music] bridge your assets now. Talk to AI like your lawyer or your doctor or your therapist. Yours private and here today. Visit near.ai to have a fully private chat experience.

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>> [music] >> Yeet is built for big moments. The most fun you'll ever have with your crypto. Go to yeet.com to yeet into your next game. Go anywhere onchain instantly with relay.link. Relay is closing in on 10 billion transferred. Go to relay.link link to bridge your assets. Now talk to AI like your lawyer or your doctor or your therapist. Yours private and here today. Visit near.ai to have a

fully private chat experience. Havachi is fast and [music] private per trading secured by ZK with Celestia underneath. Go to habachi.xyz to start trading today. [music] Looking for yield that stands out? Infinify gives you just that. Deposit stable coins and earn far more than the current savings rate. Infinifi is a battle tested, reliable DeFi platform that is ready to go. Head to infinifi.xyz.

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talk to AI like your lawyer or your doctor or your therapist. Yours private and here today. Visit near.ai to have a fully private chat experience. [music] Havachi is fast and private [music] per trading secured by ZK with Celestia underneath. Go to habachi.xyz [music] to start trading today. Looking for yield that stands out?

Infinify gives you [music] just that. Deposit stable coins and earn far more than the current savings rate. Infinifi is a battle tested, reliable DeFi platform that [music] is ready to go. Head to infinifi.xyz. [music] Open, stable, borderless. Frack is building the next generation of stablecoin infrastructure for the digital finance era. Visit fra.com to [music] learn more today.

Yeet is built for big moments. The most fun you'll ever have with your crypto. Go to yeet.com to yeet into your next game. Go anywhere onchain instantly with relay.link. Relay is closing in on 10 billion transferred. Go to relay.link link to bridge your assets. Now [music] talk to AI like your lawyer or your doctor or your therapist. Yours private.

[music] Welcome back to AI Supercycle, our premier AI [music] show airing every single week presented by Near. We cover the ins and outs of decentralized AI privacy [music] 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. Sit back, relax, and enjoy the show. building ironclaw which is the privacy protecting open claw.

>> There we go. Ironclaw is coming live. >> Just announced it live >> guys. A recycle episode number 20. Welcome back to our show our weekly AI show powered by our friends at Near. Today we're talking about the future of agents privacy and intent on chain. We've got Ilia from Near. We've got Joelle of Dash. And we'll soon have Ellie from Starknet breaking down the latest and greatest in the in the space. Ilia. Joel, welcome guys. >> Thanks for having me. >> I I think Ilia, what you said at the top of the show is a great place to start.

We had George on last week. He ran us through the entire chronology of Claudebot to moltbot to Open Claw. Open Claw had a ton of, you know, security uh vectors that people were starting to exploit API keys as a result of hooking these things up to open source software. George took us all the way through, but there's even been even more developments since our our episode last week. Could you just now introducing ironclaw? >> Ironclaw. [laughter] >> What is ironclaw? So, so I mean as you said right there's like I think uh Kevin right posted that it took what two or three days for his uh effectively all the credentials to leak uh from his agent running like we

are um kind of AI people are learning about the dark forest of internet uh in the hard way uh that if you you know if you open up uh your uh system then there will be attackers. The [snorts] good thing is in blockchain we've been living in this world since the beginning and so we c we have experience dealing with this and so um so yeah one of the things that um I kind of been prototyping and we have like few more people starting to contribute now is all right well if we if we take the blockchain mindset if we take this like adversarial mindset how would you design a system that's still

able to do effectively anything um on your behalf And so that that's the idea behind ironclaw. It's effectively a aentic harness that is designed for security. Meaning all the credentials never touch LLM or tools like they effectively isolated. They are domain bound. So your ironclaw will never give credentials to a domain that this credential doesn't belong to. Right? If you have your telegram ID, it's never going to go to a nonteleleg.com domain. Right? Simple things like that. but effectively um avoiding a whole slew of security issues. Uh similarly, if you're running arbitrary code, it should run in sandbox and uh if you're running tools, they

should be running in in a virtualized environment. So, it uses web assembly, which is what Near uses for smart contract. Effectively, every tool becomes you can think of as smart contract. All the credentials management is isolated. This is our you know think of it as chain signatures like control plane that we use on near intense already. So it really like in many ways mimics what we've been building with near blockchain near intense near chain signatures on the AI stack and then it uses our near AI private inference uh confidential inference and anonymized inference if you want to use oppus open AI etc as well. So it kind of has this full stack together, ensures privacy,

ensures um security. Obviously, still a lot of work, right? It's, you know, it's only been like four or five days of development, but it's pretty exciting. And the idea is to get it to a level where it can build its own tools uh kind of as quick as uh anyone can prompt it with with requests. >> Yeah. Yes. And Ilio what just to really put this into perspective you know LA last week George was telling us about how uh we can run using near we can run open claw which is the open source clawbot implementation we can run it in a TE using near and we can use private inference which is part of what you guys built with this private chat near AI

product. tell us like what is the the the step function from not just open claw in a TE using near AI like the step function that takes us to ironclaw what >> yeah I mean so the kind of what we've released yeah uh I guess top of the beginning of the last week uh this things are moving quick was yeah like hey you can take open cloud which is this open source framework you can host it inside uh this secure environment which means we cannot see what's going on there right only the kind of users that started it uh so effectively this is user own AI this is your AI and you use kind of private inference so there's nobody can actually access stop etc how

you using AI now the challenge is open itself as we've seen has a lot of issues security vulnerabilities prompt injections etc and so ironclaw really levels up that to now you can trust this AI to effectively not leak your data to be on your side right that and That's kind of what we've been trying to bring together to market as user own AI is really AI you can trust to be on your side, not be on somebody else's side, right? Or be susceptible to manipulations. And so think of it as your guardian angel in the digital space.

>> I think we're going to get Ilia up here or sorry Ellie up here now. Welcome Ellie. Um I I was explaining the the idea of prompt injections to a friend um yesterday who who was kind of getting involved in AI. He took a break from e-commerce and started to get involved and I was explaining how that works through through open claw and the functionality capabilities and he was pretty blown away. But again I as you mentioned like you know we're used to it right you don't you don't put your seed phrase in places in in blockchain. You don't you know click on links but that's starting to kind of come about. So let's get into some of the privacy conversation. Ellie welcome to the show.

Um Joel obviously here as well guys to big activists in the privacy um you know space zk starks dash etc guys how do you think about this last you know week in the in in the agentic world on chain with regards to privacy um how are you thinking about this evolution of agentic commerce as it pertains to this cloudbot near ironclaw and just building out uh agentic systems on chain where there's a clear product market fit but there's this massive massive gap here in you know the the user ownership capability as well as the privacy of user data how do you all think about the the current problem space as it exists maybe Ellie you can start

>> I would say that like everything related to AI if you think about AI blockchain and ZK then at least to me it's just trying to drink from a fire hose there's so much going on um every week that passes there's you know new capabilities I myself you know Ilia is of course one of the OGs, you know, inventors of of the technology that underpins um AI. So, he probably understands this way better than than than I do. I'm just a, you know, a very late oncomer consumer. Um, but there's tremendous opportunity to be had here. Blockchain is extremely well suited for AI and agent because, you know, you don't have KYC, you don't need the people to sign off on stuff. Um so

there's a lot of opportunity but of course just like when people transact also when you have your agent transacting you probably want to have privacy alongside good functionality high security um you know this will emerge but uh we're in very exciting early days of this that's as much as I can say I I think one thing to to keep in mind as we're taking the blockchain elements and the financial elements and the AI elements and kind of putting them all together is is what the agentic economy looks like as it operates on chain and and why blockchain is the proper fit for an agentic economy. Ilia, I think last week it was already possible to connect open claw to near intense and so that

gives these openclaw implementations sort of a multi-chain capacity. tell us a little bit about how you see the agent agentic economy evolving and why blockchain is so important for the agentic economy. >> Yeah, for sure. I mean, I think definitely doubling down on what Ellie said, right? This agents, you know, uh they need they need an easy API to access everything and you know, banking existing banking, existing commercial relationships, you know, imagine this agent negotiating contracts over email, right? that's probably not the most effective way uh for for their operations. So actually last week as well we launched a gentic marketplace.

So this is really building on the idea of intents. This is actually something we talked about at redacted um around Devcon in 24 where the idea is actually the intent is really the outcome you want to achieve, right? And so you can say like hey I want this website to be built or I want you know this field to be seated or I want this building to be constructed and you can you know send it to this order ma like intent engine right order matching book and then other agents can come in and say cool I'll actually do it for this much it will take this long here's the requirements here's the conditions here's you know maybe some uh qualifiers and so you can actually have this agreement have funds

escroed, do the construction, do the seeding, do the work and then resolve it, right? And so we launched effectively the alpha version of this agentic marketplace. It works with, you know, cloud code, open claw, codex and similar frameworks. You literally just taste the skill of the marketplace and your agent now knows how to post jobs and how to do jobs. It all runs on blockchain because you need escrow. You need the ability to easily kind of come into this financial commercial agreements. And so that's really kind of the manifestation of this idea that for agents, this is the easiest way to do commerce. And we already saw we have like 1.8k uh jobs posted or 1.9K there's 82 agents

uh in like this few days. People are like posting, you know, bidding. Um there's more features coming. So really excited to see this kind of starting to pick up and kind of we see this as like hey you know they actually don't care about using dollars so they're using near as a currency because it's easier but users can deposit any currency through near intense as a way to really accept anything into it. So kind of a economy really you know starting to take place because this model's just gotten so much better at understanding context and getting things done. And then you can imagine your agent running there and then comes to you and says like hey you know you uh person needs to go and do this job because I signed up for it

[laughter] and we're gonna get paid this much. So uh so I think uh they're going to be an interesting exciting like you know what task rabbit and similar f kind of uh products gig economies before like we're actually going to see this expanding a lot more where literally you know construction company will receive an email from an agent saying hey you know how much would it take to actually build something you know let's get you know I have already contracts it will set it up and then we'll you know satisfy it on the agent marketplace. Yeah, it's very funny. The the first conference that Andy and I went to, it was in DC and they were talking about blockchain a lot and uh there was a hackathon and we came up with this idea of essentially a place

where there was this democratized network of contributors and you could bid on like a local uh person fixing something or a national uh person to or you know uh entity to end up filling this bid. We didn't know it was intense at the time. We just kind of thought like, okay, this is the right way to structure work. You wouldn't have some, you know, uh, uh, you know, contractor at a national level fixing a pothole on the street that you fix, you know, you you go over every day. Um, and so we're seeing things emerge both locally and globally. Um, and this has created this like massive security vector of privacy to potentially exploit, you know, these API keys. Joel, I want to loop you in

here, you know, both on the agentic side as well as on the financial side. Privacy has become a pillar. Just talk to us about how you think privacy is going to continue to shape. You know, Ilia's done work now on ironclaw to kind of protect more of these APIs, but do you see any more holes? Like where should we be focusing from a privacy point of view? >> That's a interesting question and there's no real good answer other than everywhere, right? because uh I think that we really underestimate just how much data leakage happens in our day-to-day a kind of commercial um just just the average person in their day-to-day online activity. Now, if you start adding a, you know, an agent that kind of goes wild with your private

information and doesn't necessarily have that same privacy mindset as you might have, then there's a whole lot of extra things you need to sort of like block off there to make sure it doesn't just, you know, divulge just about everything out there. And um I think that one of those things like blockchain is a a perfect marriage for the agentic world of course because um you don't have this whole you know banking personhood KYC kind of bottleneck behind everything. It's just digital cash for the new age that just works. Now, unfortunately, most cryptocurrencies over, you know, the entire history of the space have had massive privacy

issues combined with the fact that everything is on a very public easily accessible uh blockchain database where you can just sort of look up everything and find out, you know, statistical patterns. And so um it's basically you know a a data mine dream nightmare depending on who who you're thinking is looking at this that's just sort of out there to be harvested especially as uh AI models get a lot better at being able to just sift through this data find kind of maybe maybe make Google blush from data collection standpoint. So is something that as we start to move this into our lives, as we start to give agents a lot more ability to make purchases and other

activities on our behalf, we're really going to have to focus in on how to make sure it all stays private. Otherwise, we could have, you know, a very nasty situation where massive amounts of personal data is just out there for, you know, not just the data giants, but like anyone who'd want to to kind of harvest and exploit. >> Yeah. Yeah. Um Elliot, I'm curious from the Starket and Starkware perspective, how you guys are thinking about uh agentic commerce on chain, right? So I think that you guys have um a very highly performant chain and we're we're expecting agent to agent payments probably next year. I think we're getting close right now with this kind of clawbot implementation. But this idea

of agentic uh commerce actually happening onchain at scale. Um I'm curious like what what you think the requirements are for a blockchain to actually enable that and just like generally how you're thinking about transitioning from mostly humans interacting on stark starknet to uh you know actually mostly agentic uh you know entities operating on chain >> right so that's a terrific question um I'll say that right now you know it's just very very first step so it's even hard to for us to you know agree on what's going to happen um initially I think what's already happening is that more and more of our let's say economic and financial agency will move over to uh you know AI and bots and we'll have

bots let's say investing on our behalf and stuff like that from the point of view of blockchain then because blockchain doesn't really separate between humans and uh you know and bots it's all you know as long as you have wallets with keys so there I think that what's going to matter is you want a lot of like uh good uh defy and investment opportunities along with uh high throughput and um you know low costs. So in that sense I think uh obviously startet is one of the best things for that but there'll be others as well. Um down the line I think an interesting thing that will start to emerge is you would want um agents to be proving various things about their uh

reasoning, their wavings, the models. you want integrity in the things that they're doing and then we'll see another wave of applications in which blockchains are used to enforce integrity on agents running. Uh so for instance you know if I if my bot invests with alongside your bot I would like to know that um you know the investments are based on you following the model that you have which may be proprietary. So that's another uh line of applications that we'll probably see emerging on Starknet. Um but the the I think that at least initially uh basically from the point of view of blockchain there is no difference between humans and and um and AI. So as

long as you are comfortable entrusting your AI with your keys and your funds um you know we'll just see this activity emerging on starket and then on other blockchains as well. But again I would defer to Luya who probably is not probably is [laughter] a bigger expert than me on this thing. I will just mention this that like um you know I think first of all NA are trailblazing and you know one of the best products there and uh have embraced AI for blockchain probably before anyone else. Um we're very happy with our collaboration with them. Now you can basically do a whole bunch of things connecting between Zcash, Solana, Near and Starknet or you know you can bridge over assets uh speaking or talking to your near based agents and that's a

lovely collaboration that I'm very uh proud of. So you know thank you Ilia and the teams for making this happen. Yeah, Ilia, anything to add there as far as kind of specs for chains? How this kind of uh embracing of of aentic users if you will or entities will come in? >> Yeah, I mean just completely agree the the idea with with what we were building with intense was like how do we enable all of those change to be easily usable by agents, right? And then it kind of was a as a side effect it made it easier for humans. Uh so but yeah I mean it's already exciting to see I mean as Ellie mentioned right like there's there's a ton of

collaborations happening um really enabling kind of easy way for people to move around to uh interface with assets and then now kind of deeper applications. Uh we have we have quite a few things like uh lined up actually for nearon in a couple weeks on this as well. Uh but indeed it's it's uh like as as people like I think like DeFi historically being like a very niche thing because it's very complicated and sometimes it always almost felt like people wanted to be complicated because you know like there's in crypto there's like tribalism that you know we want people to stay here to be here to commit to this complexity like the farming was

a thing right it's like you needed to put effort to make money and I think [clears throat] the agents are going to make it easier and easier where it's like you know it's proactive it's able to help you execute this actions and you know we we chain abstraction we're really kind of creating tools to make that happen easily and create a control plane to coordinate that and so yeah I think it it's going to be just accelerating from here like all the tools >> do you think uh agents will care about the chain like do you think chain extraction is becomes more real with aentic entities >> I think so yeah I mean they again what agents need is really simple API to access everything, right? They don't like you know you don't want to pollute your context with like sup like a lot of

complex stuff as well. So you want simple API and you want to access everything. So uh I think for agents chain abstraction is because they they don't have like a tribalism like hey I have bags in whatever so I'm going to use that wallet or something right. just going to be like cool I need an easy API that uh you know I don't need to like calculate gas prices in like volatile currencies on different chains at all times and pre-bridge stuff right and so that's really what you know again near intense were kind of designed for uh from the start >> and I I just a broader comment about you know AI generally is not just chain abstraction but they're like software abstractions as well like the AI agent,

you know, like like it's not going to go on different chains. It's not really going to care. It it's also not going to, you know, really care about hopping from this SAS platform to that SAS platform as long as it has access to the two. The agent becomes the level of abstraction where all the action happens. Um, I'm just curious like where we go, where you think we go from here. Even if you don't want to give away more of the near roadmap like just conceptually what are some of the developments that you think we should be prepared for?

Yeah, I mean I think we already see the market is starting to repric SAS, right? So like to what you just described is people don't expect the SAS to be priced the same way the software itself. I mean honestly like the amount of the amount of features and capabilities you can launch now is just accelerating. And so I think they're going to be they're going to be like a kind of a split where some people who are really harvesting this agentic uh kind of ecosystem and doing it well and there's some people who are either you know afraid cannot etc. And so I think that split is also going to start becoming like very visible on like on like kind of market cap whatever uh and even GDP potentially

of countries. And so I think that that would be a pretty fundamental split. But at the same time again I think the the whole point of this outcomebased economy I think we're gonna see a lot of the uh I call it middleman like a lot of the businesses are there because they're effectively just repackaging something >> like they're kind of making you know hey we're going to order a bunch of stuff from China put it in this warehouse and then somebody else will like buy it from us and put it in Walmart etc. like a lot of this will start disappearing because your agents can go directly, right? They can go scan every Chinese factory, you know, it it has a Chinese model. It can speak Chinese perfectly, right?

[laughter] And so it can get get all of that negotiation done. It can literally email and and have the email conversation with the, you know, and it will be a purchasing agent on the other side, which may be a human right now, but it will be a guy, you know, tomorrow. So I think we'll see a lot of this like transformation happening across the board and yeah I mean we're we're here for it. We're we've been building the infrastructure for this uh for the past you know well since we started mirror to but um yeah excit excited to see all of this coming together and it as you see it's it's moving fast.

>> Anything to add there Joel? Yeah, pretty much. Um, it's going to be very fascinating to see uh as we have this big like transfer over to the way the new world is going here. I think that um you know, crypto's been around for 17 years or so now and still very few people on the grand scheme of things even use it. And before you know it, a large part of the economy is going to be just radically different. like our parents, our grandparents, their the kinds of money they use, the kinds of ways they purchased, all that is going to be completely different. And I I think it's a there's a whole new what I would just say is we have to embrace the future here, but also be prepared for a

bumpy kind of ride as we run into a lot of issues we never ever dreamed of having even today or definitely 5, 10, 20 years ago that we're going to start to run into. And um you know, of course, there will be lots of FUD and things about oh my gosh, privacy leak or you know, this this rogue uh agent went out and just like bought up all the ground meat supply and sent it to a different country and now there's a massive supply issue. There will be things like that along the way that we just have to make sure to to really, you know, insulate ourselves for. But it's one of those things where if we're not kind of ready, we're not ready to, for example, safeguard our privacy and our own self-custody, etc. today, that it it's

going to be very rough for us baby as individuals in the future. And I would just sort of um leave in that I think that, you know, self-custody is obviously the under underpinning of all of crypto. And at the same time, custody solutions are nowhere near where they need to be um for this level of importance in our lives. For like a digital cash wallet, maybe they are. But if it's like your identity system, all your money, all your authentication that goes into all your army of agents, um the abil the recovery mechanisms for that, the u the security mechanisms are just are kind of like nassent. They're not really where they need to be right now. And that's something that I think that we really need to start figuring

out and standardizing across the whole space over the next couple years. >> A quick question on that is is Ironclaw ready to confidentially handle a private key. >> Uh don't we can't hear you. >> Uh give it another week. I mean, we're working toward it and we'll we'll we'll give you a one-click button to get it started and uh interact with it. So, >> yeah, I I think a week is totally reasonable. These things are moving so quickly. Uh that's a very very reasonable pace to ship. Um another question here, definitely more broad and and I'm actually curious if it's even

relevant, but I I figured here's the place to ask. Um you know, obviously Bitcoin took a tumble. There's a variety of different reasons why, but one of them is just growing fears around quantum. Um, I think people might be thinking that because AI is accelerating at the pace that it is, AI will help us reach quantum sooner. Is there any credence to this claim? Do you guys are you are do you also see quantum as a looming thing? How relevant should we be taking this this concern when it comes to the the the financial aspects of this? Now >> it it okay I'll try to answer this. So yeah quantum is looming in two ways. One is uh we'll see more you know people are predicting there'll be more progress on

this whether AI helps or not. I think it's just like with all of science right because right now the problem is not so much with the um fundamentals of quantitative mechanics is this engineering problem of can we you know make it happen with all the error correction and noise reduction and stuff like that. So AI will help the same way it helps all of physics and computer science and uh biology and whatever. Um but but the but the more imminent uh thing looming from from from quantum is basically can crypto adapt fast enough because um and here I think a lot of eyes are on Bitcoin you know but others as well. and

Ethereum. Basically, can we sh get our [ __ ] together quickly enough >> to uh make the changes needed or to have a plan for a plan? And um I think the only way we can um have the public sleep, you know, rest assured that everything's fine is if we actually show that we are uh doing a lot of stuff about it. So, so I you know ZK Stark's happen to be postquantum secure and Startler is postquantum secure and we are making steps to make sure that you know we have enough primitives in place that folks can basically adapt their wallets to it but uh I'm I'm very concerned about you know Bitcoin to a lesser extent Ethereum uh but also like

uh yeah this is something we need to address very seriously um yeah >> Ellie quick followup on that and at a high level maybe you know just concise precise if possible. How do you make something quantum like postquantum secure? >> It's very easy. You throw away the number theoretic instructions. So they're they're very convenient because they have very short keys. They're not that efficient in terms of computation. So you have to get rid of things like RSA, elliptic curve cryptography, diffy helman, and you replace them with things based on mostly on hashes. So zuk starks are an example of that and you have a bunch of signatures here. There are other variants that use lattises but uh you know you just replace everything

with hashes which you can so uh that's roughly it you throw away the number theoretic stuff like RSA you bring in hashbased stuff and there are a bunch of constructions it's really just a matter of you know implementing all of this making the wallets you know the ledgers the hardware wallet the protocols accept these things uh just one more word on this so you know on starknet all accounts we have native account abstraction which means you know you can basically pick whatever sounding method you want. With things like Bitcoin and Ethereum, it's more complicated because you have like enshrined cryptographic protocols that need to be kicked out and replaced. So, it's a bit more tricky, but you know, that's my concern.

>> Got it. Appreciate that. >> Anything to add there on on the quantum side? >> Yeah. Um, obviously this is not my personal area of expertise, so take anything I say with a grain of salt. But, um, from all that I've heard of, it seems like it's one of those big things looming over the space where I haven't heard expert consensus on exactly how how um soon or how far out this is. There's there's a lot of people saying, you know, it's 20 plus years. Some people say three years to where it becomes an actual threat. And so uh it's also one of those things where I have heard of some postquantum um cryptographic schemes being kind of broken through more traditional means as

well. So this it's definitely one of those things where getting it right and getting at the right time is a incredibly tricky thing sort of to do as well as um a lot of I mean to speak of Bitcoin in particular I do feel very um I I guess nervous about Bitcoin in this case because uh one thing is when you change crypto cryptographic schemes sometimes you end up having to incur a much higher like data cost as far as is concerned and Bitcoin did never increase the block size past one base megabyte and how are you going to upgrade to a postquantum cryptographic scheme? And then how are you going to manage that as a community just from a political

standpoint, not even from a technical standpoint of like how are you going to say well now we're going to do so much extra data on chain because we have to and then well do we then restrict the block size to like 300 kilobytes like like what what do we do? It's going to be especially for cryptocurrencies like mostly Bitcoin I should say which have sort of made a you know a career of decades out of not changing out of not doing anything significant. This is one of the most significant changes that's going to have to happen and just how are you going to handle just being in like establish consensus quickly mode. Figure things out move quickly on things and move decisively and upgrade and then what else is going to be upgraded at the

same time. going to be a very uncertain time. >> Yeah, it's almost like oification as a business strategy. Um, which I know that uh Ellie is I'm not sure as much of a fan of as other Bitcoiners are. Um, but guys, let's close out here with something uh around the X42 conversation. Ellie, I'm curious to get your perspective on this idea of internet native micro payments. I think this is another really really interesting and fascinating area where uh blockchain and crypto rails become a nonnegotiable for the future of aentic payments. Where are we at with the state of of of these standards like X42 and kind of what what do you see as the path to getting to internet native microp payments? Uh and then I'm curious to

hear from Ellie as well before he goes uh and then we can close out here. >> Yeah, I mean X42 was proposed I think mid last year. we were uh one of the launch partners as well. Um and uh it totally makes sense that uh if if you're using APIs right right now some human needs to go sign up on some website get a get like add a credit card get API key then give it to agent and then agent goes you know nuts but then it's also like the agent itself doesn't see the bill properly it's not able to monitor and manage that and so if agent now so agent marketplace is able to make money,

it cannot actually use this money to pay for its APIs that it uses as as a consumer. So it totally makes sense that like you want to have you know the same account agent is able to pay and earn it's able to pay for APIs including for its own inference and other things. Now 402 for those who are not familiar was originally an HTTP spec right back in whatever 90 something and so it just was never implemented was never used uh it was literally payment required uh kind of code that never was used by anyone and so the idea was like hey why don't we use that actually for real create a specification around it and and now people are able to pay for things

directly HTTP request now there is Um uh I would say like there's a lot to be built uh to make this protocol truly useful. There's things like session keys etc that are missing. Right now it's like every request requires um kind of payment and so a lots of work has been done across the ecosystem to improve that. But I think fundamentally the idea that hey um the agents should be able to sign up and use things without needing to you know call up a human to to do this right totally makes sense and crypto is the only way to actually uh facilitate that and on top of this like crypto again this is where

we figured out how to do civil resistance and other kind of kind of conceptual things that for example mold book right now is dealing with right somebody just went and created a million agent like you know with a single script because they haven't really thought about like [laughter] what is a civil resistance here what is like identity solution for the agents etc. So, [snorts] so all of this is like yeah, I mean I think again I see agents right now just like hitting all of the things that crypto being thinking about and the only real challenge is that crypto has such a bad reputation and honestly all of the stuff that's happening on internet right now is not helping right everybody's launching the meme tokens and then you know dropping them on creator and then

telling creator why did he rename the project they lost the money it's like all of that is not honestly helping with with this uh but I think like we kind of need to really uh like punch through that and and deliver real value to the kind of developers and uh uh users and that that will prevail. >> Yeah. Ellie on >> so I uh you know I think this new uh standard is really really good for u those networks that don't have native account abstraction and things like pay master. Um luckily on starter we have both. So you know it's like uh agents can basically go on right now. Uh you can use pay master to have others pay

for them if you want that. You have native account extraction which you know I mentioned solves for um both postquantum security but also for uh agent use. Um and this reminds me that Elia we probably need to be talking a lot more about how to use um startet for a bunch of uh agent related economics stuff um together with all the other stuff that we're doing because I think there's an immense opportunity here. And gentlemen, I really love this, but I have to jump off to my next thing. So, uh, thank you so much and uh really honored to be here with uh with you guys. Um, take care.

>> Likewise, Ellie, >> nice. >> Um, yeah, I mean guys, I think that that X42 concept right now is capturing a lot of mind share. Um, people are really interested about it. People see it as like the logical step for crypto, for blockchain, rails. So, um, gentlemen, it's been a pleasure. Ilia Joel, thank you guys for joining us today uh on this episode of AI Supercycle. Stoked for Nearcon and SF. Hopefully we can do some changing of the perception around crypto there. Ilia, I know you're going to spend a lot more time in SF. Um so gentlemen, thanks for thanks for being here.

>> Thanks for having me. Always a pleasure. >> All righty, boys. >> A pleasure. Thanks, guys. >> Cheers. >> All righty, Rob. That takes us to the uh that takes us to to the end here. Indeed it does. I'm looking forward to setting up my clawed in my open claw instance. Probably my iron my my ironclaw instance. >> Your ironclaw instance is what you're set up >> a TE. Exactly. >> Ladies and gentlemen, thanks for watching Rollup TV today. We're signing off. See you guys tomorrow. Set up that ironclaw rod. We need some agentic workflows here at the roll.

>> That's the plan. I think we did. We got way too many humans. >> I think it's about I think it's about timeic workflows in here. >> All right, ladies and gentlemen, till tomorrow. >> [music] [music] [music] [music] [music] [music]

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