Polymarket’s Cultural Relevance, PumpFun’s ICO, and Prosumer Apps | Analyst Round Table

Transcript

It's very funny that the project that's labeled most extractive in crypto is doing probably the least extractive raise that I that that I'm aware of. It's very reasonably priced. A quick shout out to today's sponsor, Katana. We'll hear more about Katana and their ongoing pre-eposit campaign later today. But for now, let's get into the episode. Nothing said on Xerox Research is a recommendation to buy or sell securities or tokens. This podcast is forformational purposes only and any views expressed by anyone on the show are solely our opinions, not financial advice. Pokio, Ryan, and our guests may hold positions in the company's funds or projects discussed.

Welcome to a live episode of ZeroX Research. Uh they already read the names. I usually read the names off in the intro, but uh glad to have you guys all on and glad for everyone making it out to perm permission list today. Um I think let's jump right into it. One of the big topics we saw on the feed, Poly Market is in the news. Uh they just announced maybe in addition to some prior raises, looks like they've raised up to 200 million now at a above $1 billion valuation. I don't think we have a ton of details outside of that, but uh it seems interesting. They've kind of been outside of the limelight for a while. I don't know. Do you guys have big thoughts on poly market and prediction markets? Like where are

things going? Yeah. So, I'll be the first to admit that I think the majority of the folks on stage got prediction markets way wrong. Um, I can remember being in the Blockworks office recording a Zerx Research Pod and I think we all universally thought that Poly Market was was done after the election. Um, you saw OI come back in. um you saw volumes come down, but then they stayed even for a long time and prediction markets entered the social zeitgeist. Um turn on your favorite podcast, they talk about geopolitical events or the upcoming local election and they cite Poly Market. There's a

huge I it's inserted itself into um into the media landscape and it's admittedly it's harder to I think identify a team in crypto that is executing at a higher level than Poly Market today. Yeah, I'm surprised we got it this wrong given that we bet on people not going more online while being online 14 hours a day and said no, it's going to go away. Um but yeah, I agree with you. I think that was the base case back in November. It was this is it. Um and to be fair to us, for a few months we were right. We were right, but for two months we were right.

And then after that we were completely wrong and we've been wrong ever since then. I'm kind of curious what you think about I guess centralized competitors like Kelshi because I know Poly Market is now very much trying to get ingrained into X. Um, and they're doing really really well. Like apart from this raise, they have a great Twitter. Um, they're like very very much in the zeitgeist as opposed to I would say like some competitors. Um, curious what you guys think of that in terms of like Koshi versus Poly Market I guess more specifically.

Yeah. Yeah. I don't have any one more point to add though before I get into the comparison there is um I thought it was interesting where you know we were talking about the pullback in OI and volume. What was the the noticeable mark there was the higher low, right? I can't remember the exact numbers off the top of my head, but if you look at the chart of OI or volume, uh when it did pull back post election, it was still at made made a much higher base. Uh so it was pretty interesting to see. I think sports actually played a shockingly larger role than I would have ever guessed. Um I think it's kind of a it's an odd proxy for or a way a tough way to get exposure to sports betting. Um honestly, it's just like not as great UX there. But I think it doesn't hurt that

we have a new geopolitical catastrophe every two months now either, right? Like the election was a huge one and now the even with the the uh activity in Iran and Israel. Um poly market's been a leading indicator of of market sentiment there as well. Uh so you continue to see the trend uh with these major global events and and poly market again just be at the center of it all. Um I would love to see an analysis of of Khi's activity though. So I haven't because Poly Market's on chain I and we we at Blocker's data we uh we cover Poly Market. So I know the data side very intimately there. Um but because Khi is not on chain I haven't actually experimented with the data. So um I don't I don't know if Ryan maybe you have context on their activity but uh yeah we love to get your thoughts on the

comparison there. Yeah, I think um Kalshi is going for licenses. Poly market is not going for licenses is the playbook in technology markets. We saw it with Airbnb and Uber where they framed themselves as you know Uber framed itself as a ride sharing service not a taxi service. uh Airbnb framed itself as um I was I forget I forget the exact framing on Airbnb, but they they made the regulators come to them, right? They they they forced change on the regulatory environment by not precisely pay playing by the rules. And I think if you are, you know, if you're integrating yourself into markets via regulators and

your competitors are not, you're at a structural disadvantage. And I think that we're seeing that play out in the market. Yeah, I think I mean you mentioned it earlier Ryan that it really seems like Poly Market is trying to tap into the kind of social consumer side of things here. The X partnership you see them all over the all over timelines all over the feeds like they're getting mentioned on media news sources for you know references to odds of of events happening and you mentioned the geopolitical events like I'm seeing the poly market tweets every day you know what's the likelihood of an Iran Israel continuation or of conflict. So, um, it seems like they're capturing some mind share, but um, yeah, I don't know. Robin Hood has I think they're working with KHI on their prediction market kind of

product. So, there's a trade-off here of can you capture user mind share or, you know, grow through a, you know, a partnership strategy with other partners, but obviously working with X is also, you know, that's a massive partner. The the prediction market itself is like at the bottom of the funnel though. So, it's going to be really interesting to see who innovates on the top of funnel, right? You can see live streams where you know pundits or commentators are talking about a set of markets um that are in their area of expert expertise and when major events happen you go live you stream and you're like focusing on these markets uh or you can see like large media entities um like I don't know C a CNN or a Fox News style right like they are the top of funnel for news and right now the news

kind of impacts the markets but I could see a pretty near future where it goes the other way around and the market moves and then the news is about that movement. U and I don't think we're too far away from that. Yeah. Do you guys um trust I guess the news more or poly market? Does that make sense? Like if you see something on the news that says this didn't happen but poly market has a 80% chance that it's going to happen which one do you take at face value? I think nowadays when you see a quick like a sharp spike on a market on poly market it's I don't know that I would say that I blindly trust it but it's almost like who who knows something about something that's happening whereas the news you know they have to wait until after the fact to confirm with the source you can

kind of see you know ideas are changing in real time which is interesting Peter Tetllock has a has a his first book ex uh I think it's called expert political judgment and just goes over how wrong pundits are consistently and how we keep elevating them as experts. And finally, we have a market that we can look to where we're not beholden to their consistently incorrect opinions. Um, you know, you think of like like Tucker Carlson recently made a prediction about what would happen if, you know, we were to retaliate against Iran or we were to get involved in that situation. It was completely wrong. Um, and you know, he shouldn't the markets put him on a pedestal, but now we have prediction markets to like kind of tell us the truth. We're not beholden to his

opinion. I like that we said that I'm not allowed to talk about geopolitics and then you guys just kept bringing it up. Very nice. Well, as a geop geopolitical expert myself, I thought it was natural to have this discussion. Um, but wait, I got to answer your question though. Um, it's very interesting. One thing I'd like to see Poly Market do is a better job of like, okay, which market has no liquidity, right? Like they were they did a good job on the marketing side with this, but like it was uh, you know, what are the odds that Jesus comes back to Earth in 2025, right? and it had like a huge run up to from 1% to 8% or something. It's like who knows what and then you look at the market and the order books got like $10 of liquidity.

It's like okay, who did this last thing? Was it 10? Uh it was very very low. I can't remember the exact number but like hundreds of dollars, not like tens of thousands. But you look at some of these larger main markets, let's call them, like the election was huge, very deep liquidity on either side of the book or uh even these geopolitical events um with the activity in in the Middle East right now. uh these actually have meaningful liquidity on them and so to your point it's like okay to manipulate this it would you know take tens of thousands of dollars which isn't a huge if someone had a a meaningful motive there uh but I don't know it's starting to get there and then you can imagine deeper and deeper markets are harder and harder to manipulate uh and that's when I think you'll definitely start to get

there so that's kind of yeah with my my theory that right now the news writes about or the the markets are reacting to the news but I don't think we're that far away from the future where that flips the the the New York City uh Democratic primary race. Yeah. Um has I think 40 million in oi. Wow. Which is not insignificant. Yeah. And I don't think I would have guessed that a year ago. It's big. We, you know, we thought they would run out of markets. They keep finding new markets to trade on. This episode is sponsored by Katana. If your assets are sitting idly, they're dead. Katana is built from the ground up to bring your bags back to life. Get started with Katana by joining their pre-eposit campaign before mainnet launches at the end of this month.

Follow the links in today's show notes to get started. This episode is brought to you by Ledger, the global leader in digital asset security. Celebrating 10 years of innovation, Ledger remains the most secure hardware wallet for your crypto and login. Trusted by 7 million users and securing 20% of the world's digital assets. Follow the link in today's show notes to grab your Ledger now. As always, investments in blockchain technology involve risk. Terms and conditions apply. Do your own research. Again, we were wrong, but uh maybe we could jump onto something that we were right about. Um Pump Fun has been another big topic. Maybe a similar strategy as well. They're trying to get into the social lens. You know, they're they're trying to roll out the live streaming product. They've got the mobile app. Um playing around with like

adding on to what is, you know, the bonding curve and like token trading product. Um obviously looking at, you know, working on a big raise at a pretty meaningful valuation. It's one at four, right? Yeah. Supposedly one billion at a $4 billion valuation. Um, which personally I think they're going to need it um if they're serious about getting into live streaming. I've I've talked about this before, but like Kick, Twitch, like these are massive competitors with huge war chests. They're paying, you know, top content live streaming creators tens to hundred millions of dollars a year either in direct contracts or, you know, the sponsorship deals that they get. Um, so it's going to be really hard to entice any meaningful talent. And then obviously if they're looking to further

expand this product or expand their team. Um, you know, there's there's tons of work to do there. But yeah. No, it was interesting you went right to the consumer side, too. I got to give Mike Apito credit for this, but I think he had a tweet one time. It was like, if you hate memecoins, it's because you viewing them from the financial side of things. Uh, but if you view them from the consumer in their purest form, I was like, all right, it's still pretty gimmicky and like I'm not sure if that's interesting, but there's something there. Uh, Pump Funds launched 11 million tokens. They've done $750 million in lifetime revenue. Uh, they've got a run rate right now of about 550 million uh, per year. And, um, you know, I think they do about $90 billion in in lifetime volume as well. So, it's like,

okay, like you can look at that and say, oh, it's all just, you know, PvP bots playing against each other or spam or money laundering or whatever. And there's clearly some of that, but again, you it doesn't I don't even think you have to squint at it anymore. It's very obviously real user demand. uh to trade these things and like it's fun. I don't know, Ryan and I are always joking around about the the 70k market cap coins of like, yo, you see this? Like it's fun. It's very stupid. You're gonna lose money, but like that's what gambling is. Um and I don't want to I mean, it's not onetoone gambling, but it feels very gambly. Also, a lot of finance is just PvP and bots and money laundering. So, it's like you can't just blame Pump Fund for that. Yeah. But I do get why if you view it strictly from the

financial lens, it's like people hate it. Like I I get it, but yeah, you have to kind of break your brain to think of it from this consumer angle. And like yeah, that sounds like where Pump is going. Uh they want to figure out ways to involve the streaming aspect. And um Carl from Sixman Ventures is, you know, he's got his own podcast running there now, has a token. It's very interesting to see like what that would look like in the future. And even hearing Ailon, the founder, talk about it, he's like, "Where else are you going to get your first 50 viewers that are obsessed?" I'm like, "That's kind of interesting." Yeah, we're seeing other personalities pick up, you know, um I don't know if it was Thread Guy or similar like some of the some of the CT kind of characters are starting to get on there as well. That's

obviously like the first maybe cohort. You mentioned it, where you going to get your first 50 viewers. Um your beloved crypto fans maybe, but bridging the gap to like maybe a less cryptoincclined audience, that's maybe that's where the question marks come in. But that's probably also where the war chest comes in is incentivizing, you know, offering up some incentives to get new creators on the platform. It the live streaming thing makes sense kind of it. No, but that's what I'm getting at. Like I think we did the research like it's clear that most money on social flows through live streaming.

People don't tip on Twitter on textbased platforms, but money does flow via live stream. But like are we going to look back in a year and being like we thought we could trade the coin while the creator was on TV like bullish? I don't know. It sounds kind of silly. Yeah, I think that's fair. I mean I think there's some experimentation be done here. You know live streams today have like uh viewer interaction tools so they can you know tip to have text to speech pop up during the stream. So I don't know if they can find ways to incorporate the tokens into like the audience experience. Maybe there's like a more kind of meaningful set of interactions for them, but they're not quite there yet. I think we need to see them like maybe ship some features in

that direction and we'll see. Maybe it takes hold. But yeah, I mean, I'm I'm there with you, Ryan. It's hard to say one way or the other. It's an experiment. Yeah, maybe it just ends up looking like a creator coin or something, right? Like uh and what I mean specifically by that is so Zora just kind of uh launched their next iteration of of their vision, right? So the each creator has their own token. and it's like uh Bacio token and then every post you every post that you make I guess gets tokenized and paired with Pacio and then that's kind of the the flywheel they're trying to spin. So if people buy and then your token is paired with with Zora. We're really running back like the curve convex 2021 relationship here. Uh no it's interesting. I I my social content is not optimized for Zora by any means.

It's definitely more like Instagram versus Twitter. I haven't used my Instagram in like three years. So, it's hard for me to like really want to use Zora just because it's not the style I want. But, I don't know. Like I I see people posting their art and whatnot. I'm like, "Okay, if you're going to post that to Instagram or post that to Zora, like I kind of see something there." I know Ryan hates Zora with every fiber of his being, but I think it's kind of interesting. So, sorry. Where what chain is Picacio coin on? Sonzora. Yeah. Gotcha. Okay. Yeah. I think um no I think I think Mike Ipalito is right when he says that the the Zora team is super sharp. Um they're clearly number two in terms of token la tokens launched. I just think I just think it's

very obvious that if you have a launchpad it should look financial and the way to um allow people to assess financial returns is to have a grid view rather than a rather than a feed. Yeah. Like the feed is optimized for social. It's optimized for text. It's op it's optimized for visual. It's not optimized for assessing financial returns. So, and there's a reason you don't see the feed in fintech apps. It's because it's not useful. Like you don't swipe to see the next APY on the next money market fund. You want to cross compare. So, like making that one little change, I think changes everything. And I I would bet that that happens over some time frame that they that they that they implement that feature. This is something we do in

crypto a lot which is building for this theoretical new consumer or user class when the reality is that we want I want the chart. I want to see the chart. Got to be able to draw lines on the chart. I want to draw my lines on the chart. An arrow going up maybe going down. Um but I agree with you. doesn't make any sense to just have like a feed style thing because most of your revenue comes from what five 10% of users and that's the crypto users. So you really want to like offer them the product. I think we get this not just like on Zora and consumer apps but also like per exchanges, lending protocols. We they try to

simplify it a lot and I feel like you can sometimes lose the actual user that you want who maybe wants something more advanced. Yeah. Yeah. All this data is uh if you want to check out data on blockworks research for Zoro or Pump Fund, it's public and available to all. So check that out at blockworks.co/analytics. It's all there. But yeah, I mean I think net net people uh when the the rumors of the pump fund raise came out, uh there was a lot of talk over like, oh four billion's a huge number, there's no way.

But that's an 8x multiple, not even six or seven. Um it's very interesting. I like there's a share question there, right? like I think the rumored amount is maybe 25% going to the token. So, you know, it would still be like a 2530 multiple there for the token, but yeah, I think if if that number shifts up further, you know, if they get 50% 75% of the revenue going to the token, then it I mean it looks really compelling and obviously this is still like you would call it still relatively an early stage growth bet. So, that wouldn't be wild by any by any imagination. I think also people think um one bill when they first see it, they're like, "Wow, that's a lot of money. What the hell are they going to do with it, but like you said, Danny,

it's like you can spend on a lot of stuff." Um they could just end up building out a whole lot of products or they could do the live stream deals, whatever it is. So, I think the gut reaction is to say, "Wow, didn't they make 800 mil last year? Why are they raising one bill?" But I was putting my like skeptic hat on. I was like, "All right, let's be critical of this." So, it's it's very funny that the project that's labeled most extractive in crypto is doing probably the least extractive raise that I that that I'm aware of. It's very reasonably priced. Yeah. Yeah. They could be raising at a much higher.

They could do they could do much higher. Yeah, they could do much higher. Shout out to today's sponsor, Katana. Katana is a DeFi first chain built for deep liquidity and high yield. No empty emissions, just real yield and sequencer fees routed back to DeFi users. Incubated by Polygon Labs and GSR, Katana is launching with a notable ecosystem of primitives, assets, and partners like Morpho, Chainlink, and more. Be early to Katana by joining the pre-eposit campaign before mainet opens at the end of this month. Follow the links in today's show notes to get started. Ledger is the global leader in digital asset security, trusted by 7 million users, and securing 20% of the world's digital assets. In recent years, Ledger has built a comprehensive ecosystem of products and services, making digital ownership more secure and accessible for everyone. Ledger's newest

devices, Ledger Stacks and Ledger Flex, introduced the world's first secure touchcreens, making it easier and safer to manage your transactions and assets. Alongside Ledger Stacks and Ledger Flex, they have also launched the Ledger Security Key app, offering a safer alternative to traditional passwords and enhancing your digital security. Follow the link into today's show notes to get started with Ledger today. As always, investments in blockchain technology involve risk. Terms and conditions apply. Do your own research. Yeah, and I mean I could see many avenues to to spend the money, right? Acquiring different products like I mean we just talked about the trading experiences. I think Pump still has some work to do there. So if that means building out just a stronger and more competitive trading app, you know, I know Bach, we

love to talk about trading bots. I know you use them. Like they could acquire a trading bot team, they could build their own, but that's not free. So and obviously the the top teams there like Axiom, they're they're also at a a massive run rate right now. So that like that wouldn't be a cheap acquisition for sure. I don't think they could even buy them. These teams make 300 mil a year themselves. Like who the hell sells that? Yeah, it's interesting. Uh we have this data as well on the pump fund dashboard, but about depending on the day like 20 or 40% of the volume will come from uh these these trading apps specifically and even higher. Um so yeah, I think no 20 20 to 40 I think is Axium specifically. Uh which is crazy.

It's it's it's 50 or 60% now total from other front ends. Wow. So, uh, pump club on the bonding curve. Yeah. Like in and in aggregate like the fees that those bots are charging, they then end up earning like as a total like 50% of what pump is earning, you know, when you break it all down. So there's there's a ton of extra money on the table for them if they were to capture some of that back potentially. Do you ever talk to somebody who's in like Trafi and say, "Hey, we're charging 1% on volume." That's true, but it's a different asset class. That goes back to the finance versus consumer thing, right? And that's that'd be ridiculous if this was like a finance application, but it's a consumer thing. I don't care. I'm paying 1%.

Yeah. Like because I'm just trying to have fun, trying to ball with the bros. Axiom is spectacular. Like I I'm addicted to that app. Um it's so good and it's not on mobile yet. Like that's exciting. I think they were on Telegram first and then they said actually we think I like the Axen team because they realize that most people who trade and generate fees use it like if I'm trading I'm using my desktop. Um unless I'm buying like Daniel Smith sends me a random coin then I'm maybe on Telegram but most serious traders I think are trading on their desktop and I think they optimized for that. They moved away from now mobile app is different. a mobile app would be great. Um, but like

their desktop product is fantastic. They've done a great job. It makes sense, right? They're hitting the power users. They're going to cap they can capture a ton of revenue by launching this product. And they already have, right? Like well over 100 million in I guess over 50 million in net revenue um when you take out the the kickbacks that they give. But yeah, prioritizing for the like the real consumers and then they can expand and build out a mobile app in the future and kind of continue to iterate. So yeah, I think that made a lot of sense. I I think it raises an interesting question which is like are crypto markets inherently proumer markets? You don't see mass market products haven't worked? Financial markets are dominated by proumers and they're they're not really mass market.

You've seen social platforms really fail at introducing financial features. And the most successful consumer financial apps are like Venmo. Um, even Robin Hood has had mild success in the grand scheme of things. And I think the smart thing that Axiom did was say like we are building for proumers. Like you need to know what a bub like a bubble map is for us to be for us to to sell to you. And and that was the right choice. And I don't think you see a lot of teams like admitting that like perhaps you should be building for the proumer, not the consumer even though it's a smaller market in numbers. I I think that's the user you want anyway because you want the people who think that they have an edge so that they'll keep coming back.

Yeah. As opposed to what's the hyperlquid quote? It's like you got to build for the person with a 50x long on with their last, you know, their last $1,000 and it's like sweating a liquidation. That's literally it. Like that's the best customer to have. It's a bit it's a bit of a sad thing to say, but yeah, you you mentioned Robin Hood there as well. Um, and I actually logged into Robin Hood desktop for the first time in a while and they had like this new uh, well, it was new to me. I don't know how new it is, but this proumer portal uh, where you can log in and they have like the modular widgets and it it felt like a I don't know. It was definitely an elevated solution. So, I think they're thinking about that as well. Yeah.

Can you explain to me what you mean by retail versus like classify that for me a bit the Venmo user versus the the pro because I feel like all of crypto is or at least let's say 80% of crypto is retail. Um right yeah perhaps I don't know that's probably changed a lot over the last year but I think that's the general rule of thumb. I think proumer is just like um you know you can trade meme coins or you could trade it using advanced analytics and you might want to pay up for advance advanced analytics because you might want to see the bubble map. Uh I think that I think that they're two distinct audiences. So when I open up the pump fund app like today

it's clear to me that they're building for a more mass market whereas Axiom is taking a different approach. Yeah, I agree. And it it does seem like, you know, if it's an axiom per se, you know, if they're building for proumer now, probably a goal in mind should always be to reach out and like bridge that gap at some point where you have proumers who are like dominating your revenues, but you can still onboard like the the product is like useful enough or simple enough or you know, exciting enough for the normal users as well. and maybe they're you capture them via like a different feat tier or you know a different style or different interface with with lower fees or a simpler to use experience but um yeah I would agree with you on Pump Fun as well like I

think there's room for them to continue expanding this where right now they you know they've gone from it was just sort of really the back end and these other tools kind of captured up a lot of that flow of you know I'll use a bot to snipe a Bonnie curve token and it seems like they're trying to get people back to them now. Um, and maybe going like very retail heavy first um, is part of that because I don't know, they they definitely have more work to do on the more advanced side of things. So, maybe that will just take time. You know, on the proumer side as well, I think, uh, one team that's doing an interesting job there is Bybit. Um, so they're, don't look at me like that. They they brought they're bringing commodities and equities into the platform as well. So,

you see them expanding out the product suite. uh as well as going so they're going like you know if they're in the middle in uh as a centralized exchange they're pushing onchain with their uh by real yeah by real so their decks coming on chain on built on Salana and then they're pushing the other direction as well into trify bringing commodities and equities into the platform uh so I think you're getting this pretty interesting spread of uh building better products for that user class that makes all right um I want to bring up one thing to end off the pump fund and then we can talk about something else. But will the pump fund token take attention away from Solana or do we think that what why are you upset? I was waiting

for this one. No, because I just want to hear out the opinions, I guess. Like do you think that it is because I feel like a lot of the Salana I guess bid has come from people saying how am I going to get exposure to memecoin um activity on Salana? Well, I'm going to buy Salana. But if there's pump fund who's what 80% of Launchpad volumes. Yeah. North of that. Um then you can just buy the pump token. No. What's the what what's the question? Do you think pump Now if I pose it like this it sounds really stupid.

Um do you think pump fun launch will be good or bad for Salana in the short term? In the long term obviously it's great. It's fantastic. I think you have to Yeah. There you go. What you go I think um I think that that opinion works in a different time. Like I think in 2021 you waited for the airdrop to happen, it happened, you got it, you sold it, and then you went on to the next thing because you were farming it and it wasn't a fun game and you didn't care. I think it's a very different market today where Pump clearly has staying power. Um it's you know we always say like pump didn't do anything new it just bundled a lot of really

popular features and minimize the friction uh associated with accessing those features. Um I think it was brilliant. They've hit mass market like normal people have phantom wallets now. It's just a different time. It's just a really different time. So I don't see how it could, you know, I don't see how injecting uh wealth into a capital market would be bad for that capital market. Yeah. I mean the question is does you know a top five uh a top two app of the cycle it's called hyperlquid in and u pump fun does one of them launching a token is that is that somehow bad for the chain that the the application's built on top of like I yes from this purely narrative spec uh view

but um I don't know I don't I don't I I really struggle I think you're doing mental gymnastics to say that right like okay plasma asking the question plasma just did the uh deposit contract launch Not true. Right. There was a billion dollars that got deposited in there. Was that bad for Ethereum because there's a billion dollars that wasn't buying ETH? Like, no. I I don't think so. Yeah. When was the last time it was bad? Just asking. It wasn't bad for hype, right? But it was if you're fighting purely for attention and you have like no basis for anything else happening, no fundamental drivers, nothing interesting happened, then it's clearly bad, right?

Because you need the attention. Um, I think there's a decent argument that it could like have a negative impact on something like a fartcoin. There there were a few like all DA layers that did their token and then it stopped right in 23 perhaps. I think that that was the last time that I saw that. Yeah, that's a good one. The maybe even the better comparison as well is like prior to launching pump swap, radium was kind of that picks and shovel spid for bonding curve tokens graduating to radium and they were earning a ton of money from that interaction. But that already has gone away. So, you know, that maybe if that still existed and then a pump token came out, you could say, well, why would I own radium when I can own pump? But they kind of already

did away with that by eating up the AMM portion of that as well. Yeah, I think it's 2021 era thinking being mapped into 2025. I don't know. Would you say go the Geto token was bad for Salana as well? Like I think if there's a fundamental story there then actually I think the Jetto token was great for Salana because it wealth effect and it made people realize that they could be doing stuff on Salana and potentially getting paid for it. So yeah, that was definitely like a rebirth moment. Um Wesy and I were on an episode of Bell Curve in like July 2023 and mentioned that I I don't want to tell you the episode because we mentioned 10 other things and all 10 were nine of the 10 were wrong. But the Geto thing was very right

in terms of the airdrop. Yeah. Just being that that was going to be the catalyst growth for bringing people back into Salana and like it's it was very inevitable that was coming. That was in July. I think the airdrop was in December. Um, and it, yeah, it ended up very much being the case. This episode is brought to you by Marinade. Marinade is focused on developing staking technology that strengthens the Salana network and connects soulholders with the best staking rates available with solutions for both DeFi and Tradfi, including liquid and native staking, as well as direct enterprise integrations. Marinad's high performance staking delegation platform brings billions in liquidity and security to the sole market. To learn more, follow the link in today's show notes. And thanks again to Marinade for sponsoring today's episode. As always, investments in

blockchain technology involve risk. Terms and conditions apply. Do your own research. Daniel, for a few months, you said that you were very nervous about Robin Hood coming in and stealing everybody's lunch. You said that the first thing that you thought of was the Gwart tweet when you woke up. It still is. Not your firstborn child. What do you think about that now? Do you still think that Robin Hood comes in? Yeah, it's interesting. Um, this actually spurred the tweet thread. I had the I guess it's just a long post but about how exchanges have moved into crypto over the over the years right so Binance was first in about 2019 they built their L1 uh then came Coinbase uh and I'm obviously skipping but looking at the big ones but Coinbase came next

slightly more lightweight version by launching the L2 on ETH and then I have Bybit who you know said forget the infrastructure we're just going to launch a set of smart uh smart contracts or programs onto an existing chain that has liquidity that has activity that we can just tap tap into that, improve our core product offering, right? So, you kind of saw the reverse happen. I think intuitively most people will probably think, oh, start lightweight and then build out and increase the amount of infrastructure you have to support this mission that you're on. Uh, but we kind of saw the opposite happen. And I think a lot of that had to do with, you know, rewind to 2019. If you wanted to do onchain trading, like there was nowhere to do it. So, you kind of had to build the infrastructure. Uh, versus vibe today has like a much more practical

reality of like, hey, why go try to build a high throughput chain? you can see all the pain that Anza goes through every day. We'll just build on top of that and they'll do the work for us. Um so I thought that was just really interesting. Uh and then so that's what kind of started me putting that in the context of Robin Hood. It's like okay well where on that spectrum are they going to start? uh because I think the argument for still going the infrastructure route would be that they have the distribution right they have the web 2 application that all of their users are obsessed with uh and so they don't need to kind of like uh work alongside an existing platform that already has the activity like a base or a Salana um I don't know what they're going to do like it seems if you were

trying to go I don't know I'm still so torn because the natural thing would be to build the chain uh but I think what is doing makes a ton of sense right all they want to do is deliver their core mission of building a great trading experience for their users. Building a chain doesn't necessarily get them closer to that on day one without this huge uh amount of maintenance um and up upfront cost uh versus the very lightweight smart contract route. So, I don't know what they're going to do. Uh I really don't I'm torn because you could could see a Robin Hood doing something more similar to how Coinbase has tapped into Morpho. Right now they can offer lending on Bitcoin without doing anything. They're just tapping into Morpho. Um, so it's like do you want to go the lightweight route that probably has a less uh revenue potential

today uh and going this like smart contract first route or try to go uh a heavier route where you build your own infrastructure, your own chain, build things on top of that. Um, and someone like Robin Hood is is well resourced to do that. But I don't know, I'm pretty torn now. I think it comes down to products. like if if it's building a chain and certain products are going to be more valuable or more useful or more meaningful for them as a business or their customers by having it on their own chain then I think they'll experiment with that. If they think they can just launch some apps on a Salana or a base or wherever else or arbitum or ETH then I'm sure they'll experiment with that too.

I don't know. You went through all of the technical like there's all these trade-offs and things, but I think for for like an established business with a a strong customer base, like it's really just going to come down to what is going to enable the most meaningful valuable product for their customers. And I think they'll be weighing those things. Maybe that maybe that means going both routes, like just experimenting and seeing what works best. Yeah, I actually think it comes down to um their particular um legal and compliance departments. M I I think that building your own chain is a fantastic monetization method because you can reorder the transactions. Um and someone's going to have to decide if they want to take that risk of doing that in a centralized fashion or have a path to that. Um

so yeah, so I think it's like I think it's a a risk tolerance thing on building your own. That's an interesting angle. And even think about like banks, right? Or large other large fintexs as well. JP Morgan has a chain was Onyx, now it's Kexus. Um, but they launched their JPMD stable coin on base. Uh, or you look at like a Fiserve now working with Salana. Uh, or even PayPal doesn't have a chain, but they launch a stable coin. Um, you're seeing more people go the lightweight route. if you have the ability to go with stablecoin. So I think like any large bank um yes they also have the distribution engine there to you know be able to bootstrap their own ecosystem with their own existing customer base. Uh but the stable coin

rout seems very attractive and then you can issue that anywhere you don't need any other infrastructure wherever there's demand just inject it in. Um I don't know I I'm getting bowled up on the lightweight thing. Well, I think if they're doing settle like sending money from I guess stable coins, it makes sense to do lightweight, but if they're trying to do like settlement of other things, it would make sense to do maybe build out your own chain. It's just like I I depends, right? We're seeing like Kraken partnering with Back just using a solution that's I think on Salana, right? So maybe they're a great example of doing both, right? Because they have eight and then they also have the other thing. So, they're just gonna put That was kind of my point of just like try it, see what's going to work

out the best. I mean, there's there's incentives at play as well. Like, I'm sure plenty of these, you know, foundations teams, they'd love to have these massive, you know, customer bases come onto their chain as well. So, I'm sure that is like in the decision-m process as well. I'm glad we brought up Kraken. Kraken, Kraken. Um, Ryan, I want to ask you this. Do you see a lot of I guess exchanges and non exchange cryptoreated companies whatever products IPOing over the next year.

If you if you popped open the information today they gave a list of who's going to be next um or who they thought was going to be next. For example, OKX is I think making enough noise that you know perhaps it's them. They were in the information this morning. I think um I think Kraken's another candidate where they've been private for a long time. But yeah, no, the IPO markets are open. Um the administration changed and IPOs went from zero um to relevant again. Uh you can raise capital now. It's legal in the US after a long time of being um you know batted down by the CFTC and other regulatory partners. Um so yeah, IPO markets are open and um you you you see

the you see everyone taking advantage of advantages of it. What do you think about uh so circle had a remarkable uh IPO from from many perspectives. Uh opened at 31 I think it's at 2:30 today. uh when you see someone like Superstate or uh I think I'm blanking on who the other person was here, the other team working on this, but bringing equities onchain. Um I'm curious, Ryan, to get your take on how you think, you know, if I'm a series B company, I have like, you know, a handful of options. I probably can't IPO, but let's pretend I could. Uh you know, I have the opportunity to IPO, launch on chain, or just do an additional round of fundraising and stay

private. Like, how do you think I should weigh those options? Uh, I think I think in in terms of going public, it's still US capital markets and exchanges are the place to be. I think that's pretty clear. Um, it's just safer and you can still have a really fantastic outcome. Like, sure, there's more cost associated with it, but if you're a proper company, you pay those costs. Yeah. Um, I think that on I think that the onchain stuff you have to you have to find your niche like what believe is doing where it's targeting a very specific niche cohort of builders who can raise capital in a way that they couldn't do it before. The US capital markets as far as I'm concerned are still the gold standard like now that'll change over time.

Perhaps we'll be back here in a year and it'll have changed but for a few years um I I don't see it changing anytime soon. Hopefully hopefully I eat my words. Circle just did fantastic. Yeah, that probably slowed uh if you know if you were again if you were the person in the hypothetical shoes I just made up, you got to be like, okay, how am I not going to IPO? Who you got to want to follow circle, right? And as these in as these experiences get integrated where I could trade the crypto and this the DGEN stocks in the same place like where like it kind of is like where does it matter?

It just comes down to a few hundred,000 a year in listing. Um, and of course the IPO fee, but you know, you you pay that because you want a specific set of investors. You you want who the investment bank is getting for you as opposed to randoms on the internet, which I think there's value to knowing who owns your stock and and their pedigree. Yeah. So you could see a real like melding of markets that kind of collapses a bunch of that stuff together and the decision-m process just becomes more simplified.

Okay. Um before we wrap it up, I have uh two things I want to mention. First of all to the listeners, we have ZeroX Research to Danny, you have to correct me. Is it tomorrow? Thursday. Thursday. Um here. Is it here? It's in industry city. Yeah, it is in industry city. You guys want to come? They're all here. Yeah. And me um me, Danny, Daniel Smith, and Ryan Connor. You should show up. I'll be there. When are you getting in the dunk tank?

Tomorrow. I'd like to get in there tomorrow. Come out to the dunk tank tomorrow. Right out there. Uh we'll probably play some games and get in the water. I mean, it's it's hot out there, so I think it'll be well well enjoyed. Yes. But the dunk tank is also right under the sun as well. So that's also going to be warm. True. Perfect. Very good. Uh quick data show. We just launched our dashboard builder and we're announced our API and our chart builder coming soon. Uh really excited to just basically enable more tools to work with data in a richer way. Um onchain data is awesome. Blockchains are just giant open APIs, but pulling that data off and understanding what it means in a a contextualized and useful way is is extremely challenging. And we love solving the problem to make it easy

for you. So check that out. Uh just put out the announcement tweet, but appreciate you all and come chat with the research team at the booth and at the arena outside. Yeah, come out there next few days. Awesome. Awesome. Thanks, guys. Thanks, everyone. [Music]