Vitalik's proposal to move Ethereum off the EVM, plus Bittensor

Transcript

GM. Good morning. Welcome to the Milk Road Show, the daily crypto show with more hope than trying to cancel a gym membership online. I'm your host, Jay Hamilton. It's Saturday, April the 26th, and once again, we are crashing the Milkro Pro research meeting just like we do every week. We've got Adrian and Martin in the house, two lead writers and researchers on the Milkro Pro team. These guys do absolutely nothing but research crypto all day, every day. And every Tuesday we have a research meeting where we talk about whatever is going on in that week. We record it and we release it to you guys for free every Saturday. So you can try to figure out where is the signal within all the noise and there is a lot of noise right now.

Today we're going to discuss the Bitcoin decoupling which is becoming one of the favorite conversations of this show right now. Uh we're going to dive into is is Bitcoin decoupling from risk on assets? Is it becoming a riskoff asset? Its correlation to gold. We're going to look at some charts. We're going to talk all about that. Vitalik wrote a new Ethereum proposal. What happens with Vitalic writes a new Ethereum proposal? Everybody stops what they're doing and tries to understand what the heck Vitalic is talking about and how to be even close to the tech nerd that he is. So, we're going to break down this new proposal which is suggesting that Ethereum move away from the EVM, the Ethereum virtual machine to a new smart contract language. Look, I'm not going

to get into technicals right now, but we'll break it all down for you and make sure you understand and how it might affect Ethereum and the price action. And finally, we're going to talk about Bit Tensor. Why? Two reasons. One, it's got it's done very well over the past month. One of the best performing tokens throughout a lot of this chaos. Bit Tensor has been on a real rise. And two, it's it's one of the few AI coins that has real fundamentals behind it, unlike a lot of the AI Asian coins that are really just meme coins at this point. So, Bit Tensor or Tao, which is Ticker, is a very interesting token to look into if you really believe in the AI crypto narrative, and we're going to break that down and talk a little bit about our views on it in terms of whether or not

we think it's a good investment. Before we jump in, I got two very important things to tell you about. First, today we're releasing a pro report which outlines our bull case for Coinbase and why we believe it could one day reach $1 trillion in valuation. That's obviously a massive gain from where it is today. So, if you're a pro member, make sure you check out the report. If you're not a pro member, you might want to go pro. And right now, you can go pro and get 20% off your subscription. Why? because we believe very strongly that we are still in a bull market and we're going to put some money where our mouth is.

So, if you go pro today, this week, if you go pro before May 1st, not only will you get 20% off, you also get a money back guarantee that if we are not at Bitcoin all-time highs by October 31st, 2025, we will give you a full refund. Today's episode is brought to you by Moonay. Trade crypto fee free, fast, and on your terms. It's also brought to you by Coin Shift, powering top crypto treasuries with their yield bearing stable coin CSUSDL. All right, guys. Welcome back. Uh, another pro research meeting today. No Kyle, he's playing golf or whatever somewhere in Florida and not paddle though. Yeah, not paddle. Uh, yeah. Uh well I was playing pedal the whole

weekend and actually I was couple days off and it was really good to just be offline for a couple days and just do you know something offline and touch some grass and this kind of stuff. Uh it's very underrated still especially for people like me who are 247 on Twitter and like just in crypto very deep all day long. Uh very useful. I would recommend that everyone uh anyways especially right now there's so much noise right now so much noise.

Yeah. And also like at some point it will make you think about like why we are here why am I doing what am I doing like and these beliefs if they are still there it they don't disappear and like then you are doing something good you know and like stay there just try to ignore the short-term volatility right now and focus on the long-term picture and it doesn't change at all for me and if something it's making me more and more bullish on crypto every day. So um yeah, but hopefully the price will reflect that optimism eventually.

You also need the right portfolio positions to relax over the weekend. Yeah. Yeah, sure. Yeah. Uh was was your portfolio not relaxing over the weekend, Adrian? Oh, it was now it is. But a few months ago, I couldn't have taken a weekend off. Oh, wow. Yeah. Yeah. Talking about portfolio, we are going to start with Bitcoin and gold because we see some interesting dynamics in the markets. Then we are going to talk quickly about the Vitalik recent blog post which was kind of uh surprising to everyone I guess and then Adrian has some uh news and updates what's going on in AI space

and bit tensor. So um yeah that's the agenda for today. Uh, I think we can start right off. Maybe I'll share Bitcoin finally decoupling. Is it happening? Is it happening, guys? I don't know. I don't know. We have been talking about Bitcoin decoupling for so many years. I feel like uh that's something we were all hoping for all the years. And now like over the last two weeks what we can see in the markets that stocks are down S&P and and NASDAQ are down and obviously dollar as well but Bitcoin and gold they are making uh new highs. Well I mean not

all-time highs for Bitcoin but new alltime heights for gold. So what does that really mean? Is it finally the the decoupling we have been talking about for years at this point? uh or is it just you know I don't know short-term noise and we will be correlating with stocks um in the future anyways what do you guys think I mean we've seen this decoupling several times already or decoupling so to say because if there's just less interest in the market less treadfi um in the market less Wall Street um Bitcoin can actually decouple because there's just not that amount that's

typically in tech stocks that's typically in Bitcoin maybe also in Ethereum and crypto uh in the market anymore. So I guess that might be one of the reasons was uh was Bitcoin correlated to like I mean bit Bitcoin's correlation is its correlation to US tech stocks. It basically trades like a high-risisk tech stock and it has it has since co Did it trade as a high-risisk tech stock before COVID or was it really COVID printing money printer went on liquidity entered the system and Bitcoin started from that moment forward to

trade like a high-risisk tech stock just because of all the liquidity that entered the system specifically within the US. So we had a lot of American money entering the system. What do Americans bet on? Americans bet on high-risisk tech stocks and they started to trade Bitcoin like it. I don't think the correlation was that strong before that and I think now what we're seeing is we are I think we are seeing the decoupling. I think it is I think it is early days but I do I kind of feel like it's happening. I don't it's tough because you know you I'm going to say this and then two weeks from now Bitcoin's going to we're going to head to local top. Look it's it's early. It's early, so it's difficult to predict this, but it feels like a few things are happening right now. With all of the with

everything that's happening with Trump and tariffs, there is a move away from American assets that is happening right now. I mean, look, look at US treasuries. US treasuries are not being bought like they typically are. Typically, US treasuries are seen as the flight to safety in moments like this. But right now, the flight to safety is gold and only gold. And of course, gold is always the flight to safety. That's nothing new, right? But everything is going towards gold right now. And as when you see everything going towards gold, then we all say, okay, well, everything should also go towards digital gold, right? It should go towards gold and it should go towards digital gold. And so that is also happening. My my gut says we are seeing the decoupling but early early also we could have just seen Bitcoin might have

just find found a local bottom right now is also possible and it's just it's in that range and we're rangebound for a while. So like I don't think anybody should be I don't think anybody should be going crazy yet and saying that the decoupling has happened yet. Martin, what do you think? Yeah, I think it's too short time frame to make any uh kind of decisions right now. Um at the same time maybe a part of me w to kind of believe that it's finally happening. Um is it just a response to the tariffs because you know it tariffs do not impact the bitcoin price or whatsoever the same true for bitcoin but it's not

true for stocks and techn you know nasdaq. So, um, while I agree, I would love to see that decoupling, I still think that that's might still be quite early to say, okay, we are off the race and we are decoupled from stocks at this point. So, I pretty agree with what you just said. And by the way, um this is another chart because everyone right now is bullish on gold. But if you compare gold relative to stocks, which is the the black black line here, you can see that gold versus stocks was a there was a huge downtrend in n in 80s and 90s and

then it went up and then final financial crisis hit it on in 28 and since then the gold versus stocks went down again. So now we are just like you know there's a little spike up right now and everyone is like wow go gold to the moon but you always need to zoom out and see the bigger picture. So the question is is also kind of gold going to outperform stocks from now on or you know what's the what's the function here between more money hitting the markets and stocks which might be overvalued at this point. Who knows? I mean like couple years ago when we were looking at

stocks market we might be seeing like um companies making ton of money and I remember consensus was price earnings ratio below 20 is a good buy and now couple years later and we are saying everything below 30 is good and it's because like the the money velocity is much faster and also there is much more money in in the markets because we are all the time printing new money. So like it's really hard to see like this dynamics. How is it going to play out in the next three to five years? Let's say is gold going to outperform stocks and we see this this black line going further up or is

it just you know recent concerns about the economic growth and once we are back on a bull market like who gives a about the goal everyone will buy Nvidia, Apple, Amazon again and we will do just fine and no one will remember these discussions at all. What do you guys think? I mean, we see a flight to safety here with people buying into gold so much, but we should hope gold stops rallying sometime because typically then Bitcoin uh can rally because I guess some money, some of the profits from gold uh will triple down into Bitcoin.

Certainly, Bitcoin always lags gold for sure. For sure. uh but it hasn't it it traditionally at least in the past five years it hasn't followed gold because again it trades as a risk on asset not a risk off asset risk gold trades as a risk off right and we all know that Bitcoin is digital gold and it should like long term I would you guys you all agree right like it's eventually this decoupling is happening so we're not debating whether it's going to happen or not I mean if it never happens then Bitcoin is never going to become digital gold we got a bigger problem here. So, uh, but it's going to happen eventually.

It's just a question of of when it happens. I think the thing is though that right now there is just it is so all of these conversations could end up being noise because it's all tariffs and what is the end state of tariff policy in the in the short term and there needs to be a short-term end state because Trump needs needs an exit soon, right? He needs an exit in like the next month, I think. Like he is he is getting to the point where this is spiraling out of control. We are we are definitely in a recession. The data doesn't say it yet, but for sure we are. We're going to see it in the data in the next few months that we're in a recession. And like at that point, it's going to be, you know,

you risk the you risk the growth scare actually becoming a serious thing and spending going down and unemployment rising and then we can like really spiral out of control. So it but like right now it just feels like look risk is risk is very high and so what happens when risk high everyone goes goes to risk off assets and they're going to gold and then thankfully they're also going to Bitcoin. So yeah, I just I think it's too early to actually say there's a decoupling, but it does feel like to what what I really see is I don't think this correlation between Bitcoin and and uh and tech stocks or the NASDAQ risk on assets feels like the

the Fed created that correlation with all the printing they have done since co I think that's where that correlation came from. We like the the Fed built that correlation out of thin air because they just printed so much money and now that correlation is coming off. But here's the thing. Most likely the money printer is going to turn on again later this year. So then does the correlation come back? Like I I could see it coming back. I just I don't know. You It's too early. It's too early right now. Maybe I have to add as a German the German stock index for example is performing quite well while the NASDAQ and S&P is down a lot European assets are performing well

because that's also kind of a flight safety right now. European I mean German bonds are are performing well right now. I mean there's just there's just a rotation out of American assets right now because I mean like you guys are out of the US. Tell us like what's what's the what's the media saying? Like I'm guessing that the media outside of the US is saying, you know, move your money out of the US. The US is dangerous. Trump isn't trustworthy. Don't don't listen to him. Right? Like that's what let's, you know, that's just what the media is saying outside the US. So I think there's a lot of money is flowing out of American assets and into other other equities markets, other assets, bonds and and gold obviously because

we're in a riskoff environment currently. So do you think that the money will stay outside of US or once we are back and we know we have more certainty about the tariffs and you know trans policy and those kind of stuff they will come back flow back to us or they will stay in Europe or elsewhere. Yeah that's a great question. That's a great question. Uh I think there's no there's there's no challenge to the US dollar as the global reserve currency. There is no alternative right now. I think some people are thinking like what is the alternative? And there I think some people are looking for it, but there's

no alternative. There's nobody there's no there's bit Bitcoin's the alternative, but it's it's way way way way too early. It's not Bitcoin yet, right? Like not not not at that scale. And also, so I yeah, I I don't know. I think that I think that we I think some money will not flow back in, but I think it's going to be hard to The problem is is that the US just the US can keep printing. They do not have an end to this debt cycle that they're in. And when the US keeps printing, then more money flows into the US and into US stocks and US stocks rises because

Americans buy US stocks. And so then everybody wants to come here and wants to invest in these in in these markets. So I don't know that that cycle I I don't I don't know that it's going to stay out at the scale that it's moving out right now. Yeah. Yeah. Yeah. I agree. I think like the the uh if you look at top 20 uh biggest companies in the world, so I think like 18 are US-based and like just just look at yourself, right? Like we all use iPhones or Macs from Apple, then we watch Netflix in the evenings, then we buy something on Amazon. So we all use kind of American products because

they are the best ones. And even though I'm from Europe, I cannot really think about any company that I really love based here in Europe. Like the the first thing that comes to my mind is Nestla because they are doing KitKat and these you know sweet stuff but what else? like maybe Adidas is German but I I don't know like there are not many great products in Europe like to be honest and if you are investor you will have these glasses and look okay what are the good products and who is going to crash next 10 20 years and is there something interesting in Europe going on I'm not sure like we are trying to regulate crypto when there isn't still that huge

adoption of crypto in in Europe versus America is now like on the other side and like hey we need to support this technology because it's going to bring a lot of wealth in the future and it helps us to uh grow demand for our dollars and like they are very kind of proactive in trying to attracting new builders coming to the US and building on these technologies and Europe the parliament and you European Union is kind of the opposite and Like even uh the central bankers in Europe are like hey we don't see Bitcoin as as everyone else and they are like very old schoolooled guys it feels like. So I'm

not sure if any people really want to stay in this market for a longer period of time. So now we might see you know because also dollar is is going down and we expect it keeps going down. So I can see also they are trying just to protect the exchange rate of their currency and now when dollar is expected to go down and the Trump and everything so they move uh all the funds from US away but eventually they'll come back I think let's be honest everything in crypto comes with fees but here's a nice surprise moon balance doesn't take a cut you heard that right no Moonay fees when you buy or sell crypto with your moon

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Backed by regulated real world assets and secured with institutional grade risk management by our friends at stakehouse financial. Put your treasury cash to work earning native yields and protocol rewards built by the team behind Coin Shift which is trusted to manage over 1 billion in business treasuries on chain including a Gitcoin and hundreds of leading institutions. see why CSUSDL is gaining traction at milkroad.com/coinshift. Here here's what I do think is interesting is you know Adrian you said I said what's the what's the other option for a global reserve asset and you said Bitcoin and and it's true and

just that that thought right now that is happening right now there is I there is central bankers there is governments there is large macro traders that are all looking and learning about Bitcoin right now. Doesn't mean that they're in yet, but there's there's a lot of learning happening. So, and and this current I mean, there's a lot of people saying that this current uh cha chaotic crisis, this, you know, this mess that we're in is is really great for Bitcoin, right? Maybe not maybe not immediately in I mean, you can see it right now in the price. Maybe that doesn't sustain.

Maybe this maybe it doesn't decouple. Maybe this uncorrelation doesn't continue. But it doesn't change the fact that now is a moment where there is a lot of these large macro players that are trying to figure out okay if I don't trust US in the long term if I don't want to buy US treasuries in the long term because I believe that the US dollar is going to continue to debase then what else am I looking for and look I'm being a bit I I'm not saying that this this trust of this lack of trust of the US is going to continue I do think they will get it back and I do think this is a moment in time as a result of Trump just you know being a total nut sometimes but I think that you are

there's there's some interesting things going on around Bitcoin right now which are very very bullish for the long term. Do they show up in the next six months? I don't know. Yeah. Yeah. All right. And actually Bitcoin is already the 13th biggest currency. It's um more or less on par with the Russian currency already. It's it's bigger even than the Russian ruble. So it's quite the accomplishment I would say. I also wonder when those biders of gold right now will switch and kind of buy Bitcoin instead and what the ratio even today is. So maybe like you know out of all that money I don't know 5% is

flowing into Bitcoin and the rest is into gold. But that ratio is probably going to increase over time, right? Um but but isn't that isn't that interesting just to to go back to that what what are the what are the largest currencies in the world? Because like think about that. Okay, so you're you're a central bank and you need to figure out where to park your money and like if Bitcoin is next to the ruble right now, you're obviously not going to pick the ruble to put your money in. So like it it it does sort of show the the potential like there's not a lot of there's no other option for this global reserve currency and Bitcoin is gaining

fast, right? like it really it it it builds the case for the long term of Bitcoin very strong right now and actually I think the gold bucks they will not only change to Bitcoin they will also always love their gold but right now many European countries they are thinking about moving their gold out of the US and they might have a problem actually getting it so in the future they might think uh Bitcoin as digital gold is way easier to move we don't have to store it anywhere else so might be a good idea to diversify the Bitcoin. Man, I think this is a huge value proposition for everyone. Like if you have a lot of money and it's all in gold, then at some point you might going to have struggles

to move these kind of money or wealth around the world versus Bitcoin is pretty easy. I would like to talk a little about the the recent proposal. Yeah. What was Vitalic up to this weekend? just thinking to throw out the the the virtual machine. What's going on here guys? So um TLDDR is and uh it's not proposal as proposal that Vitalik is just coming uh with this idea and saying like hey let's vote tomorrow if we should do it or not. Instead try to think about like is bringing an idea and suggesting that this might be useful and

kind of inviting a new feedback from more broader community rather than saying we should do it even though we all know that he's very respectful and like very smart guy. So when he's suggesting and proposing something kind of bringing this this idea, it's usually not getting a lot of kind of uh arguments against it. But I just want to start by saying this is an idea that Vitalik came up with and it's not like a certain thing. it's going to be discussed because there are a lot of open questions and I don't know the

answers. I just want to uh point this out and kind of provide you with the explanation of what this uh idea is about. And you recognize that this website is Ethereum magicians. That's so typical Ethereum. So true. Yeah. Oh, Salana would not have Salana magicians as their website for managing their proposals. Yeah. Yeah. Yeah. That's that's right. Um, so and let let me be clear, I am not like 100% sure what like this whole uh idea of replacing EVM with risk 5 is about. I'm not a technical guy and this is very

technical thing. So I'll just try to provide my understanding of what is going on and the idea is right now Ethereum is running EVM which is Ethereum virtual machine. So you can think of some kind of standards how uh this machine is operated and it uses some um variables and some kind of language how to describe how the code should work and how smart contracts should behave. And it's all good, but the point is that it's not that compatible with the future that Ethereum thinks that they are heading

and that's ZK future. ZK is zero knowledge proofs. And if you also think about the the chips that are built, you know, uh Intel or um Apple is also building their own chips, they are all using some kind of uh language how how the hardware communicates and but those guys are using closed source uh kind of um languages for communicating the hardware and software. But there is an open source uh standard which is risk 5 and it's getting very popular among among the the the zk zero knowledge community.

And if we think that the future of Ethereum is in ZK and if you don't know what ZK means, you can think of it as a very cryptographic uh oriented or like mathbased uh proofs that something happened without revealing the the data behind it. So like if you do transaction on Ethereum, it might don't need to verify everything that's happening. you might only need to verify that the transaction is correct. So um I don't want to go into that much details but the point is Ethereum is heading into ZK future and we think that with this new standard which is called risk 5 this is open open source code

that it has a huge community people already who are building using this uh standard. He he thinks that Ethereum would hugely benefit from it by it would simplify a lot of things and it would bring much more scalability to the Ethereum. So I have seen some feedback from a lot of people and it feels like a lot of people are really seeing these um ideas very positive in a in a sense that yes there is some Etheum virtual machine it was working fine it's still working fine but there are some limits and if we really think that the ZK is the future

we should really consider this this idea going forward. Sorry. Uh what does it mean for what? For layer 2. What does it mean for them? When the L1 changes from the EVM to our ISC. Well, this is still not like we are going to change it tomorrow, right? It's still like a and if this is approved uh in the future, it might still take couple years before it's really implemented. And like all the EVM contracts that are working today would still work. It there would be a interpreter which would just convert the kind of old EVM contracts into this new

standard risk 5 and that way it would work but from now on it would still take a couple years before it's like fully uh deployed and approved. uh so we are still quite far from there but I in general I think there is a lot of changes updates announcements around Ethereum and while we could still debate okay Ethereum is 200 bill um market asset today uh should it be more should it be less many people think that it should be less maybe they are right I don't know but the idea is that Ethereum

is doing so many changes. They are building on like so many lines how they want to ensure that they are going to stay relevant in five or 10 years and all the key players on Ethereum today like you know these layer twos or banks or whoever is going to use it or whoever is using it today they are happy with the road map and they are building towards their needs in the future as well. So a lot of changes and uh I think a lot of these fat should now go away and like okay Ethereum has reset it already leadership and everything you can hear the feedback from big investors and like a lot of builders in the space

that there are big uh changes that you can feel if you are in Ethereum ecosystem today. So um and this only kind of give me give me a a more credit or give Ethereum more credit that it's really happening and we are reflecting what's happening and what has been unlocked recently because like zero knowledge technology wasn't a thing a couple years ago but it's a huge thing today and even though it's still not like you cannot uh provide ZK proofs within a couple milliseconds today it might be possible within you know 3 five years and that's why you need to look you need to have a

future approach future looking approach let me put it that way so um yeah do you guys have any thoughts here do they want to make the L1 scalable is this the change from the L2 road map it's not changed like L2 road map is still in place and but this This is going to scale uh execution layer of Ethereum. Yes. Yeah. This would definitely scale the L1 for sure cuz basically I mean to to me this is like really techy deep in the weeds like leave this to the builders kind of stuff to be honest. Like it's so funny to me that this stuff this is where this is

where decentralized organizations are so different than centralized organizations. Like you would never see typically a company talking in this way in public about their their road map and their tech and what they're doing and so and everybody loves every time Vitalic makes a post everybody loves to go crazy and dive into it and what's it mean and blah blah blah. But like look TLDDR Ethereum's 10 years old. Cryptography has changed immensely in the past 10 years and they are doing what they need to do to scale for the future like here and here you go and this makes and they and zero knowledge proofs are the future and Ethereum as an L1 is also like that's the that's what they need to do.

They need to continue to scale the L1 and so this is what this is one one option of how they can do that and shout out to Vitalic for continuing to push and we'll see how this conversation goes. Uh but yeah, I think I mean so it's all positive to me for Ethereum, but I don't get too caught up in the weeds of this because as you said, Martin, like this is we're talking about a decentralized organization here. Like this isn't like Vitalik saying this is going to happen. This is him saying, "Hey guys, this is my idea. Let's all talk about it. Let's vote. Like it's going to take a while." So, uh you know, it's a new Vitalic post. We're going to talk about it for a week and then we're all going to forget about it. And in the background, all the nerds are going to

continue to talk about this for the next few months until I make a decision and then we'll we'll have a decision in the future. So yeah, I don't I don't really go too deep into this stuff because I'm also not a tech person. I don't know the difference between EVM and and risk 5. Cool. Great. Scale ZK like that that part. I know we need we need ZK. That's for sure. But also like your point of uh going out there and like just having some blog post, right? I guess you you need to do that because a lot of people are dependent on your on your tech and like I don't know there is thousands of builders who are building on top of Ethereum and you need to kind

of provide and you want to be as much transparent as possible and like also inviting that feedback. So the opposite of this would be okay we are doing this and that's it just announcement this is more like you know let everyone get on the same boat let make sure that everyone is compatible with this and we are not kind of providing platforms risks for anybody basically uh so yeah but I think but I I so I agree with what you're saying I totally agree like you need to do that the problem is Vitalic is too big of a celebrity that's really the problem to me here, right? Like we all like we all hold Vitalic up on this

pedestal and he is he is the he's the face of crypto really like other than Satoshi, but Satoshi has no face. So it's Vitalik, right? He is the face of crypto. And so the pro that's the issue is like Vitalik makes this like super technical post that really is for the builders and for the tech. And it's not like I'm not saying it's not for the investors. It is we definitely need to understand the roadmap as investors, but everybody goes so deep into it. Whereas if if the if any of the other decentralized chains make suggestions like this, there's there's not this level of discussion about it. Not

everyone is speculating on it and trying to dive into it. You know, it's not the same thing. And so I just think there's there's just there's just too much weight put on Vitalic and what he says. And I think it leads to I don't know like overanalyzing something like this which like is it's too early to know if they're going to go with this or I don't know. I just think we're we dive too deep into his stuff. And it's not like it moves price, right? Like does does this conversation move price? No. Yeah. I mean it's actually a vampire attack on Salana because if I read here smart contracts can also be written in Rust which is the programming language for Salana. I might get some

that's actually be quite interesting and I'm really wondering what happens to zero knowledge layer 2 because consensus and CK sync they built zero knowledge layer twos with hundreds of millions of VC money. Will these still be needed or Well, I guess they can still build it. This is for Ethereum execution layer. Uh so um yeah anyways L1 why use an L2? Well, like because you will not still fit for all use cases and like there are still companies or fintexs who will want their own chain. It will be an L3 another L2 general L2.

It will be another app chain or L2. Yes, but that's the future like we are bullish on, right? Like we have products, we have infrastructure, we only need to bring more users and those like Coinbase, Kraken, Revolute, Revenue, they have the users. So, we need to give them the the the tech the infrastructure to bring those users come close closer to DeFi to the products that we are building here. And it just makes me much more optimistic about the L2s that exist right now. Yeah. Yeah.

Yeah. Well, you need to have something. You need to have a working product or you need to have a huge user base. If you you have any of that, well, you you might going to struggle. I think everyone besides space. Well, Kraken has inc. It feels like, you know, they might also have a shot. um Hyperliquid took a different approach. They started with good product and now they are like building more um EVM kind of generalized chain. So yeah, it's tough to call Hyperlid put Hyperlid in the same category, right? You know, they is a different approach like they built an app and then built a chain which we all agree that makes a lot of

sense. You got the users and you have the app that they all use, then like sure, go build the chain and you know take more profit and have more control and build better features. So like that makes sense. Exactly. All right. Should we move on to Bit Tensor? What's going on there? Sure. Let's talk about Bit Tensor like half of Crypto Twitter. I recently saw a lot of big uh content creators jumping on the Bitensor wagon and Jay if you could share the coin geko or Yeah. Yeah. Yeah. Let's start with this one. Actually, there's now a uh fund that focuses on Bitensor and especially the subnets which we'll be uh coming to in a minute. So, there's a lot

going on. Also, Barry Silbert from uh digital currency group. He's uh very much into Bitenser. He just talked to Ral Pal um about it. I can really recommend his talk. It's quite interesting. So, a lot of institutional money being quite interested in decentralized AI. And if we uh check the potential price on Coin Gecko, we can see it's actually over the last yeah, seven days, maybe also over the last month, one of the better performing assets because in the current shop, we saw very low prices around $170 US, but

now it almost made 2x. So not bad in the current market sentiment a little bit. Maybe also tracking the positive price action of Bitcoin because uh yeah the tokconomics of Bitensa and Bitcoin are very much aligned. Both have a fixed supply of 21 million tokens and Bitensa also has a 4-year hoppinging cycle. So in 2026 the inflation will actually just be half of what it is right now. I mean the current market cap 2.9 billion. It's not low at all. It's no micro cap anymore. But uh if we want to bet on a decentralized AI, maybe after

the whole AI agent hype, we are seeing uh it makes more sense to yeah look after the more established products maybe be diversified because right now um we have to think about uh when we check any altcoin what's uh really going on. Is there a market and is there a problem and a solution that's uh something that's being solved by this project? And right now with a centralized AI, I don't know about you guys, but I think it's a little bit scary that big tech owns all of our data. And I guess many people

will not use the incognito mode of chatd for example or of perplexity. But it uh yeah it makes me really afraid when I hear that CHBT has now this extremely big context window of 1 million tokens. So if you give it personal data, Open AI, maybe even Microsoft at some point will have a lot of data about you and you should really think about do you want this because data is also kind of the gold of the 21st century and data is very valuable. So maybe in the future it might be interesting for all of us to be able to have our data on the blockchain

somehow. um being able to publish it to doctors or something like that or also being able to sell it at some point to companies because it's so valuable and if the companies already have all your data they won't give you any money for it. Can you just can you just explain Bit Tensor? Like let's just back up for a second for those who don't know Bit Tensor. Can you can you give us a an overview? Yeah, sure. It's this decentralized permissionless AI marketplace more or less. It's an open market for different AI services. It's not just one project, but it's actually 88 subnets. And each of these subnets has a special use case

uh something solved with AI. This can be uh on the one side. Yeah, exactly. These are the subnets right now on the screen. This can be something like sports betting. It can be data analysis. It can be prediction analysis. It can be compute. So there's actually a lot of use cases and every one of us could start his or her own subnet and become a part of this bigger net uh work of different AI models and this decentralized AI marketplace.

Is there a token for every subnet? Yes, you can ask that. Excuse me. Is there a token for every subnet? Um actually now there is because uh in February we had the dynamic TOAO upgrade and before that we just had the TOAO token and basically a centralized committee that chooses the winners that get the tokens from the emissions that get the uh incentives that are being mined basically from the miners. And we had very limited growth and no real incentive for the different subnets to really excel to be uh to build really useful products. And now um each of

these subnets has a unique token. They are called alpha tokens. And if you stake Tao um into a subnet, you will receive the alpha token as a staking reward basically. So you give up your TOAO. It's kind of like a swap. It's the alpha token, but um you get the alpha token and you can stake it and get deal on it as well. And the price of the different alpha tokens, it's actually determined by the amount of tow that's staked in a certain subnet. So right now we have um market driven rewards. Before that we had this very centralized, not open market environment. And that's what I guess

will really excel the whole ecosystem and make tower and the kittens way more interesting. You want to tell us about some of these subnets? I know you got a bunch of uh screens to walk through here. Yes, let's look into some of the subnets um from Arrayan Labs. Actually, they are uh they created different subnets. Um first of all, what we're seeing here is choots. they are doing a serverless AI infrastructure. Um you can basically use uh most of the AI models there. If you uh go to the website of Judes on the on the next tab um and you choose the model right now it's llama for maverick but

you could also use deepseek for example and all the new or um Japanese or Chinese models that are being created you can use and test them there and everything for free of course you don't have to go to all the different websites and uh use some sites like this compare the different models and how they perform or you have a certain use case for example that might just require a new AI model. We've also recently heard about the model from Alibaba which is very powerful. So um yeah that's actually a cool uh use case. We also have uh something like gradients. this no code AI training and

this has actually a very good cost advantage versus Google vertex. So the advantage here is it's just uh way cheaper than the centralized counterpart what they are doing. very interesting because this is one of the biggest challenges of competing with the mega tech companies with AI is the the cost, right? They've got billions of dollars to spend on compute and and a little guy who wants to develop AI doesn't doesn't have access to that. So, they're going to get beat out by the big guys. But you're saying that with gradients here, you can access the highest performing models at at a low

cost, a cost a cost that is lower than what the the large tech companies are providing. Exactly. And why is that? Because uh anyone can basically use uh GPUs for example to contribute in such a decentralized ecosystem. Therefore, you have a cost efficiency and you're also using um compute for example that would be idle instead. So that's uh really the advantage of decentralized AI. And then of course you might have advantages when it comes to privacy. You don't have a single entity like Microsoft storing all the data. You could also potentially scale uh almost indefinitely uh because

uh yeah if you me and 100 uh thousands or millions of users actually just give their compute and build nodes for this ecosystem. They could outperform a supercomputer and get incentivized by tokens for that. Of course, these uh tokens are very inflationary. Um it's quite difficult to hold these, but that's the whole thing with Deepen, for example. These tokens are uh mostly no long-term holds, but it's quite interesting to just incentivize users with tokens and make them Yeah. participate in something like

a share economy basically from digital devices. Any of these other uh subnets that you want to run us through? I know you got 19 sports tensor 44 404 gen templar. Yeah, actually a sports tensor is quite interesting because we have a sports prediction market uh prediction markets um with poly market getting very popular and this is actually a subnet that is already profitable. So they are making 35% ROI versus mostly industry negative returns from their centralized counterparts. Um it was just about 18,000 monthly profits but they already started the first token buybacks which

is also interesting for quite a novel AI product. And uh what's uh really cool as well if we go to the next tab 404 gen the uh subnet 17 if you go to the web app. Okay, we are already in it. Um it has a Unity integration. Unity is a 3D asset uh tool where um 3D uh designers basically create assets. And uh what we could do here is for example create assets for games for metaverse applications. We're seeing a lot of growth here. And if you just yeah make

me a you could create any object and I get a 3D um you could with any prompt create a 3D object. See if we can do it. Interesting. I don't know what that milkman says it takes up to a minute. Let's keep talking. I'll come back. But uh Unity uh already has 1.2 million active uh users. So with this integration, this could actually be an interesting subnet as well. Of course, all of these are very risky, very speculative. So um yeah, don't just buy any subnet tokens.

But if you're looking for interesting um AI use cases then bitenso subnets are definitely something to consider and the site for for example which we just showed to pill it's very helpful to understand what different categories are there and what different subnets might be interesting. So is the is is the trade here trading tao which is bit tensor's token or is the trade going down into the subnets.

I would say for most investors the trade is tow because it's just a bet on the whole ecosystem and you need to stake it for the different subnet tokens. Um yeah as I already said the tokconomics are not bad. there is some inflation but um yeah when we see the whole uh ecosystem getting more traction then tow not be a bad bet if you're really into AI if you can evaluate these subnets and if you are trying around with them and see a very good use case um there might be alpha in these subnets but um they have even higher inflation um they have

staking rewards that's nice but these might be quite difficult holds because most of them are 10 million market cap. So very risky low caps. Lots of but even more downside. Exactly. It feels to me like um launchpad for AI startups basically. And it also feels similarly to layer ones where we see if there is something successful then they are going to launch their own kind of chain or I don't know like it's easier now to start on the

subnet for I I guess they'll provide some you know technical uh infrastructure and like some docs and some tools and those kind these kind of um things. But then if you are really successful, do you still need to be tied up to Bit Tensor or you are going to just your own way and build app chain or whatever? Yeah, you have you certainly have a point there because in the beginning it might be interesting uh you are participating in this more decentralized economy. You're getting of course all the incentives from TOAO 7,200 TOAO per day. Um, and the best subnets get the

most incentives. Basically, we can also see it on the website here on tow stats. If you go to the Yeah. Yeah. Subnets you see for example, Jud is the biggest one gets the most uh tow incentives. This was the one where can use the different So it's so it's like curve like if you have curve tokens you'll st them and then you have kind of v voting rights to direct the emission of new curve tokens to the pools right so this is the same the same uh system here if you sta to some subnet then you can drive you are driving more incentives to that subnet.

Yeah. Yeah. Yeah. You could say it like that. But you're also very transparently seeing which subnets have traction, which ones are popular right now. And these are typically more these with good use case. It's very interesting in the beginning, but yeah, because there's this there's this question to me. The simple question here is who's going to win AI? And would you bet on obviously there's there's a good bet to be made on the large tech companies winning AI, right?

Like if you know Microsoft, Google, FA, Meta, Netflix, like it feels they feel like the likely ones to win, but we keep seeing that they're not the ones winning yet, right? We keep seeing DeepSeek and all of these newer smaller teams building AI models, building products that are capturing the market and doing Perplexity, another one, right? Perplexity is a small company. It's like a hundred people out of the US and it's like one of the biggest AI apps that we have right now, right? Um, so I think what would interest me about Bit Tensor is if you if you if you are a builder

that wants to build an AI and you need you need access to to compute and access to AI models, you can do that through Bit Tensor. You get the incentive right now if you go and build on Bit Tensor. So you have an incentive to do so and you're part of a big open- source ecosystem which is very attractive to a lot of builders right now. Like I can really see I can see the the I can see where this goes for for Bit Tensor like it feels like they could they can attract the right builders and if they can get the right apps to actually go then this ecosystem could continue.

Obviously, as Martin said, there's a risk of somebody exiting the ecosystem once you get product market fit and you get big enough, but I don't know. I think there's there might be there there might be continued incentive to stay. Yeah. I mean, it takes a special kind of builder. Maybe more these cyber punk guys, for example, that are not so much interested in VC money, but more about independence, more value decentralization, for example. Also, many from the Ethereum community, the original ones. But also like if you're successful then you have more to staked to your subnet which means higher like bigger sell pressure to your token. So it's like okay if I'm investor I got attracted by this subnet

because it feels like they have good product but at the same time they're getting a lot of incentives and therefore their token is probably going to suck in in next few months or so. So like how should I play it you know if there is something really useful and which might have potential like I don't know feels like experiment experimental to me and more of a like go there and see what's what's being built and get some inspiration where this industry might be heading. Um it's certainly experimental but um we can't invest in open AI or something like that. So so then maybe on the next

big AI startup. I mean everything is experimental in our space except for Bitcoin basically. So that's a good point. Yeah. Right. Yeah. I don't it's and all I mean I think the other obvious thing here is what is going to get the what token is going to get the air AI narrative when when the bull market comes back. We we already saw it in in Janu and then early Q1 this year. AI tokens ripped, right? It was AI had the narrative. We know that AI is going to get the narrative again. It already has the narrative. Everyone is talking more about AI than they're talking about crypto right now. So when the bull market comes back, there is going to be,

I think, a lot of attention on AI tokens. Bit Tensor if it can catch that bid and be the one or maybe it's just Fartcoin and you should just go buy Fartcoin but it also has has the AI connection but that is to me that that's that's a big play here. If you're if you're looking for an AI token that you can that you can get behind then it could be TA. I know we have we have more on the agenda but uh I think we got to we got to wrap here because we're already uh nearing an hour. Well, great chat today. Great chat. Yes. We we we miss Kyle, but it's it's it's good to you know, it's good to have not have him sometimes. Yeah.

Yeah. He's enjoying golf. So, hit the golf course more often, Kai. Well, thanks for listening in everybody. Appreciate you guys showing up. We will see you back again next week for the research meeting. Have yourselves a wicked awesome day. All right, that's a wrap. Thanks so much for listening in folks. Before I let you go, I got to tell you about a quick documentary that I've been telling all my friends and all my family about. And that is Vitalic, an Ethereum story. And I mean, I'm telling everybody, not just crypto people, I'm telling non-crypto people. This is an incredible documentary made by award-winning winning filmmakers. This isn't a a typical crypto documentary that we've seen in the past. This one is very high quality. It dives into Vitalik's life and his story. and he is

a fascinating individual. Not just for what he's done with Ethereum, but really the way he thinks and the way he operates beyond just Ethereum is fascinating. And then also, if you're an investor in Ethereum, nothing better than to understand one of the leaders and how his mind works. So, check out the documentary today. Link is in the show notes. You won't be upset. Thanks again for listening in. Have an awesome weekend, y'all. As always, if you liked today's episode, please hit subscribe and make sure you follow us so you don't miss out on the next one. There's also a link in the description to our free 5minute daily newsletter where we simplify crypto for you while making you laugh. And if you're willing to step up your crypto investing game, we're going

to also leave a link for Milk Road Pro. You get access to our portfolio where you can see exactly what we are buying. This is your number one resource to help you invest successfully in crypto. One final note, this show is for educational purposes only and nothing we say is financial advice. Investing in crypto or any asset is risky and you should never invest more than you can afford to lose. Thanks so much for listening in my friends. Have a wicked awesome