The Wolf Of All Streets - Bitcoin & Crypto "Have Bottomed" As Investors Prepare For This Major Event!

Episode Date: January 7, 2026

Bernstein says Bitcoin and the broader crypto market have likely “bottomed,” keeping big upside targets in play, while traditional finance keeps leaning in with Morgan Stanley filing for new Bitcoin and Solana ETFs as spot Bitcoin ETF inflows rebound. We’ll also cover why 2026 is shifting from “writing crypto rules” to actually making them work—across accounting, stablecoins, and tax reporting—as the industry moves from hype to hard compliance.

Bernstein analysts say that Bitcoin and crypto have bottomed and there seems to be a growing wave of people that agree with that. I tend to be one of them. Also, we finally have some clarity, no pun intended. On the date when we'll likely have a markup and potentially vote on the Clarity Act, which is January 15th, only eight days down the road. Can that finally be the catalyst that sends the all-coin market soaring or are we yet again going to be disappointed by huge fundamental news that doesn't move the market. I'm going to unpack all of that and more today with David Young from Coinbase. Let's go. Good morning, everybody. Happy Wednesday and welcome to the show before we get started i'm to say something i never say anymore like and subscribe apparently it

helps and uh makes me a real YouTuber i am no longer in the oval office as i was yesterday i'm sorry i was not feeling presidential we went back to the trading desk here we're going to unpack all the things i talked about in the intro and more with david i'm going to bring him on stage right now good morning sir how are you hey scott love to be in the you set thank you very much it's we're very professional now as you can see I'm now in, I guess, New York City here. But listen, let's talk about some of this news here. So first, I mean, Bitcoin, I'm taking a look really quickly at the market here.

An uninspiring 91,771, kind of pushed towards 94 yesterday. Altcoins, some have been slightly outperforming for a little while here, but still seems at best that we're trading in a range. So I guess let's just start with sort of the price action as we're coming into the year. December was a throwaway. Right. 2025, you can even say it was a throwaway. So what are we looking at now as we are into January?

Yeah, but 2025, I think, ended on a sour note, in part because we saw a lot of tax loss harvesting. And so this was driven by technical pressure. This was something we had suspected was going on, but it's become evident because we have get lagged data on ETF flows, for example. And we saw those outflows in December. And on a dime on December 31st, you saw a lot of that change. I think that a lot of people were anticipating. that change, myself included, but some people were kind of attributing that to like options markets because we had a big options expiry on December 26. But ultimately, now that we're

seeing like inflows coming back into our space, again, you can see that in the ETF side of things. Like, I think that this is really what's contributing to the move. So we've broken out of that 80 to 85 range where we actually like said, that's a good place for people to actually accumulate here. When that was happening, like, you know, but it was a scary time to be doing so now i think that's what's a good time yeah exactly by by when there's blood in the streets even if it's your own right if you're not like feeling a bit emotional when you're buying that you might be making a terrible decision it's probably not near the bottom that's kind of how i felt when like i kept seeing things start gravitating lower and i was like well i made a horrible like decision

uh but obviously in retrospect it was a good one but you can't always say that so i'm not going to pressure people into that. That's not our deal. But now, like, I am pretty constructive on what's going to happen in the first half of 2006. It becomes a little murkier in the second half the year, but I think in the first half, the macro landscape supports it, liquidity supports it. I think some of the regulatory developments support it. So I'm still pretty optimistic by what's going to happen. Yeah. So let's talk more about, I guess, that exact idea, which is Bitcoin and broader crypto markets have bottom Bernstein analysts say. So listen, I mean, we've seen Bernstein analysts making wild, you know, predictions because it's good for headlines and gets

them lots of press. So we take every sort of prediction or idea that comes from an analyst at any of these institutions with a grain of salt. But as I said in the intro, there's sort of a wave of optimism, I think, that the bottom may be in. Nobody's really screaming about new all-time highs in the next month necessarily. But hey, maybe we're going to range here for a really long time. We'll start to climb the wall of worry, you know, we could get back to 100 pretty easily, but maybe we're not going to 50 or 60, which seemed to be the consensus if you took a look a month or two ago. So, I mean, you kind of just talked about it. You thought 80 to 85, that area was a good buy. I guess since we've seen the price action from then, are you believing that the bottom really

could be in? Or are you kind of just short-term optimistic, as you said, and then back of the year, maybe we are correcting again to the downside? reason I'm more uncertain about what's going to happen in the second half the years because we're going to have other things. Like, for example, the U.S. midterm elections, things that put pressure on the macro side of things. I think that there's also, for example, a lot of people are discounting like what's going to happen with the Supreme Court decision on tariffs and people are saying, well, there's too many outcomes to actually predict. And I agree with that. I'm not trying to price that into the market. But for example, if they do come out and they say, you know what, we're going to strike down tariffs. And it's up to the Trump administration then decide, well, what are we going to do about that? Are we going to apply new tariffs? Are we not going to do anything? If you don't do anything, actually, that could, like, you know, potentially be a positive for markets because then you would have, like, backdoor stimulus into a lot of those importers. And actually, that would be good for the U.S. economy. That'd be good for risk assets. So that's kind of what I'm looking for. I think that's probably the most likely possibility, but I don't know at this point. So I can't price that in. But if that happens, that I can see the rally extended further into the second half a year, So that's why I'm kind of just like, let me kind of put a pause there. Like my visibility kind of ends around the April, May area, to be honest with you. Like, I don't know if like we'll get through like June, but I do think that right now, a lot of people are calling for the end of the rally in tech stocks, the end of the rallying

crypto, or at least like the pickup that we've seen in the last like week. And I don't think that's right. That's why I did like rally. But here we are at 91. I guess. That's why I changed my language. I say, like, pick up. I love it.

I love it. I mean, you're actually correct, but people will say that it's rallying, right? Gold and silver stocks, they're all literally at all-time highs, and our rally is to 27% down. Yeah. And that's probably me at all-coins are really doing worse, but they all coins have showed, I do think in this very recent rally since the new year, what gives me a little more optimism is that all coins have kept up or even outperformed, right? Which I think is a generally good sign of health in the market.

that it's not just those Bitcoin inflows. Yeah, it's interesting because some of those higher beta currencies, or rather, I would say Ethan sold right now, at least on the blue chip kind of like crypto names, but still in the alt. They're definitely outperforming Bitcoin right now. I do think they have higher beta to Bitcoin. So I think that's why people are kind of gravitating towards them.

But I could also see that once we get, and I say once, because I think that a market structure bill is coming, I think that once we have that, a lot of people are going to be deciding, well, what are they going to be the real winners of this? Because Bitcoin already has a lot of clarity around it, and so far as people already understand its commodity. So what comes next? And I think that they're going to look further down the risk curve to kind of try to look for the alt that could benefit from this. There's a couple of things that obviously come next if you're taking a look. And one of those is that if you're going to $250,000.

So I don't even know how to comment on that because like we're talking about it there. It's great. Yeah. We don't make price predictions, but if I were to make price predictions, that would be so beyond like my, my forecast that I can't even like, and I'm like an ETH bowl. Like I, I've held on to it for a very long time. But at the same time, I'm kind of just like, I like to be realistic about this kind of stuff. And that's kind of where, like, I'll be, so, you know, like, I, as I said, like, I think Bitcoin was going to find its bottom close to the 80, 85 back in, like, Q4.

But I also thought that we would probably get back to 100 by the end of the year, and we didn't. So our predictions aren't always going to, like, kind of pan out. It's really hard to get price levels. But I don't know what's going on with a 250,000 kind of forecast. That's going to 250,000. And also, you may not have read. but CNBC has said that XRP is the hottest trade

of 2026. I can say actually since the new year, the price action supports that. It's been up larger than most of the market. I can't say that's going to be a long-term thing. I mean, listen, if it's going to $2.50, then XRP is going to like $10,000. These are all

and we hear those things. I should have taken the signal because we put out our crypto market outlook and like mid-December of up last year. And someone came out of the woodwork, which is like, hey, I noticed that you had a Salana section, but on XRP section. What's going on? And I'm like, oh, boy, I feel like XRP is going to rip here. And I feel like that's, that's kind of what's happened. I think a lot of people have been gravitating towards other alt tokens over the course of the last few weeks. And I think

Solana is still hanging in there, but certainly it seems like a lot more attention has kind of moved towards XRP lately. Yeah, I agree with that as well. And if you, you take a look at those two specifically as being the assets that most recently got notable ETFs. Salana did well and XRP did better, right? I mean, both of those largely through December, at least outperformed Ethan Bitcoin as far as having consistent inflows. They were like a month at a time without any outflows. But XRP has looked very good on that side as well. I don't know if that's the XRP army that's buying the ETFs or institutions or where that money's coming from. But there's clearly been very steady interest to be fair in the

Yeah, and what I'm watching for with that is have we left momentum-driven market? Are we really gravitating towards fundamentals the way people believe? Because you've seen like the whole hype theme, for example, when hyperliquid really kind of started shining attention on the buy and burn kind of, you know, dynamics around financial engineering for these tokens. But now there's so many things are going on. Like we saw Uniswap actually agreeing to vote on the, or the vote agreeing to do the fee switch, but also equally AVE has been kind of going back and forth because people are saying like, well, hold on. Are we moving to a market where people want more equity rather than tokens, are equities the way forward? Or is it going to be tokens that are going to be? And so I feel like we're in a inflection point for the crypto market, trying to figure out where do we really belong? Like, do we want to see fundamentals accumulate to these projects? buy the tokens, or are people ready to kind of say, like, all right, decentralization isn't as important to us as value capture, and value capture it's going to do X or Y. So I feel like that's kind of where we are at the moment in the markets.

Yeah, so where do you stand then on the sort of token versus equity debate right now? Because we have a lot of big ICOs that are, I mean, that are coming, right? I mean, I think crack in Yemen. I mean, there's a few huge companies in crypto still yet to be traded publicly that we know are coming. So, you know, should investors, I know you're not giving financial advice, but like, do you think that there will be more hype from investors on those than the monads and, you know, token launches that have been hyped for years that are likely coming? I wouldn't qualify it as like hype per se, but certainly if I look through my telegram channels, you know, once upon the time, there were just people who were just like, oh, I'm only

trading tokens and that's it. I don't invest in stonks, for example. No, says it anymore like you see people investing like in uh you know tech equity like quant names or energy names or ai as fluidly as they invest in crypto and you know like i can't argue with that because we saw a lot of those names uh perform well in 2025 also because a lot of the crypto names uh start a lot of crypto projects start crossing over a la like the IPO circle or or other names, as you just kind of mentioned. I think that more and more people have drawn their attention into those markets. But equally, we're getting tokenized equities into our market.

Purps are being introduced into traditional finance. So we're seeing this kind of like back and forth between like TradFi and Crypto. And a lot of like the best parts of crypto are being like imported into Tradify. And we're also taking it on the other side as well. You see JP Morgan saying like, oh, we're going to do a tokenized money market fund. the first bank to do so. So I think that it's not just one direction or the other. I think it's very permeable that wall.

Yeah, just a growing kind of swell of interest in the industry as a whole. And people are going to find new and creative ways to invest in it. I just happened to while we were talking, just give a quick chat GPT on what $250,000 ETH would actually look like. And that would be a roughly $30 trillion market gap, which would be larger than half of the entire United States stock market. and would be one quarter of the entire global equity market. So I don't know, you know, like, I think it's cool to make bold predictions, but that, I mean, sometimes things come out of people's mouths that I. Yeah. I don't know.

I mean, like, I'd just be happy if we started pricing the last upgrade, which I don't even think is in the ETH price just yet. I'd be happy if we got to 5,000. I don't even think we really incorporated the Pectra upgrade because you still have, like, Lido and other firms who haven't even, like, completed the consolidation. of their validators. I mean, like, just that alone, I think, would give a boost to, like, ETH.

But I don't think, like, anywhere on that ceiling of, like, 250,000. I mean, I don't know what his time frame is. Is that over, like, the next year or the next, like, 20 years? I don't know. But before the sun explodes the earth or something, I have no, like, you know, before the dinosaurs, next grand extinction event of humans, it's got to be billions of years. You either make the forecast or you, like, and give the time. timing with it or give the timing out of the forecast, but you can't do both.

Nobody will be alive that remembers that forecast when he hits $250,000 if it ever does. But either way, there are some things we can talk about that actually are happening. It might matter as I talked about once again, the intro of clarity on the Clarity Act. Crypto Bill Markup expect to next week as pressure mounts before shutdown deadline. We're talking about this being done by January 15th. We're hearing that from a number of people. Still, I think a lot of debate on contingencies that Democrats, first Republicans want in this bill. So I don't think that there's consensus yet or that either side has sort of given in.

But it does seem like most people believe this is passing and passing soon. So, I mean, I guess you can handicap that for us if you think that's actually true. But the other side of that, obviously, is what would this mean for the market if it does? Let's just speak in theoretical and this thing passes. you know, it's going to be 90% what we want. Is this a catalyst or is the expectation that it's going to get passed already priced in? So we have to be very careful about what the market means because there's actually two bills in the in the Senate in the Senate, uh, that we have to be paying attention to.

One being pushed by the Senate Bank Committee and one by the Senate Ag Committee. And the reason that happens is because the Senate Bank Committee has regulatory oversight of the SEC, where the Senate Ag Committee has oversight of the CFTC. So once those markups get done for both bills separately, then they can be unified in a single bill, and that bill can then go to the Senate floor. So it's very pedantic. There's a lot of steps to it.

I think it's a good step forward because we heard at the end of December that they wouldn't be trying to mark it up before the Christmas holidays. Wasn't completely unexpected, but I did think that something can get done in committee by January. So that's what it looks like it's going to happen. Obviously, what could potentially happen with a government shutdown, I think still is an overhang on this. I don't think it would be like, you know, a terrible thing of like, oh, well, that means

nothing's ever going to get done again. Like, we saw what happened in the previous, like, government shutdown and Q4, which is basically the Senate, like senators were just twiddling their thumbs because they're, well, we had nothing to do here. Hey, let's look at this crypto bill and they dusted it off and they were actually like getting work done on it. So I think that there could be positive outcomes. in these things that like doesn't necessarily jive with people's knee-jerk reactions but here

I think they could probably get this through committee in January I don't know however if that means like by the next back in the last two weeks of January that they could actually do the full unification and get this through the Senate floor but then keep in mind if that does happen they would still have to go back to the house and then the house has to reconcile the clarity bill with this bill, and then it can go to President Trump's desk. So there's still steps that would kind of disqualify this from being done in January. But I think within Q1, assuming the government shutdown doesn't, it doesn't either doesn't happen or doesn't last very long, then I think that we still get it done by Q1.

Yeah, it just blows my mind that we're talking about government shutdowns again two months later after the largest shutdown. We're just so fundamentally broken. It just reminds me why I like buying Bitcoin and holding it in self-custody. just in case anyways, because it's funny that we have to sort of even hinder to all this nonsense government shutdown. But it's just, it's so nonsense. That was a big part of my thesis about why I thought Q4 would have gone better for Bitcoin because we were seeing this like government shutdown looming. We had a weak dollar. Gold was still doing pretty well, which I was like

Bitcoin should catch up to that. And it didn't really happen. But I think the macro environment, the macro setup, still very supportive. And a big part of what took us down, was the sell-off and tech stocks. And we ended up, at least a lot of the crypto space in Bitcoin, particularly sold off more with that than actually going together with other store values. So I do think that that could be a reversal in the Q1. Yeah, maybe that's just an opportunity for us to catch up. Actually, I was reading this before I'm trying to bring it up.

But it's from Far Yard. I believe he's the head of policy at Coinbase? Yes. Yeah. Yeah, and so, you know, he's saying here, the Senate Banking Committee marks up the market structure bill next week, and stable coin rewards remain under debate. Congress already settled this ingenious, reopening it now only creates uncertainty and risk the future of the U.S. dollar as commerce moves on chain. I mean, we're really still even just, I mean, it's called rewards here, of course, right? But we're really, even in clarity, still talking about whether we can get yield on stable coins, right?

And we've had all these kind of think pieces on what this could mean for community banks and we're going to destroy the banking. industry if we give people yield, which is nonsense. And he goes deeply through that. But it seems like we're still trying to settle things that are already settled with new legislation. Yeah. And if you've been paying attention, you know, this was coming in part because a lot of the bank lobbyists, you know, realized that there was this loophole in the Genius Act that they didn't necessarily cover because they didn't want yield in it because, you know, the banks obviously don't want to lose the you know their their lunch and you know like you know they then notice they're like oh crap we didn't cover the loophole of like what if there's a third party that wants to be able to

offer yield and stable coins instead that puts us at a disadvantage and so the banks the bank lobbyists have then kind of come in and try to push it on the like market structure bill instead so the handling of stable coin yield they've been kind of trying to tackle it from the angle of like well could this be a conflict of interest, for example, is there an ethical issue here? And this isn't the only topic that's kind of holding things up. I think that there are other topics of discussion on the custody side, the language around custody that are kind of still pending. So, you know, there's other things that need to kind of be hammered out. But I think definitely the banks are really trying to push for, and I keep saying the banks. It's really the bank lobbyist, but I use them as one of the same.

They're the ones who have been really time for discussion. I think we know who pays the bank lobbyists. I think they're pretty interchangeable. I don't think that's unfair. I mean, one sort of potential positive that we got was we obviously had this MSCI FUD that strategy and other treasury companies could potentially be delisted, which could give some precedent to even strategy being delisted from the NASDAQ 100, things like this. There was a lot of conjecture. That's not going to happen. So MSCI has decided not to exclude strategy and other Bitcoin treasury companies from its global indexes. Strategy up 6% after hours. I haven't looked at it since. kind of a funny tweet here from David Bailey from Nakamoto and Bitcoin magazine.

He's bag secured now, kill the MSC, IFUD. And he's talking about the fact that Morgan Stanley filed their S-1 for the Bitcoin trust with the SEC. I think this is actually really meaningful news. We talked about it a bit yesterday. They filed Bitcoin, then they filed Solana. So this isn't Morgan Stanley effectively recommending I-Bid ETFs to people. They're creating their own product.

That means there's a deep belief here. But people may not have seen that they now have also added Ethereum trust to the plan crypto lineup. Morgan Stanley going all in on creating these products. I guess we had two topics. What does it mean that the Morgan Stanley's of the world are doing this? And, you know, how important is the MSCI sort of FUD being behind us? Yeah, I think that the MSEI FUD was a big overhanging the market.

But, you know, I kept getting a question since it was announced. I want to say it was like, you know, two months ago, maybe like weeks to month, two months ago, like somewhere along that line. A lot of people are like, has this been priced in, for example. And we did see that it weighed on sentiment, certainly, because people are accounting for, could this be like billions of dollars worth of potential passive outflows from strategy and therefore from the Bitcoin kind of market? We also saw at the same time that Michael Saylor, who previously had a very firm stance

that like, I'm never going to sell my Bitcoin holdings, then kind of pivoted somewhat. And so I think that all these things kind of happened at the same time. But what's interesting is I don't think it was fully. in. I think it was, a lot of it was. So this is kind of why, like, Bitcoin itself hasn't necessarily caught a huge bid after the news kind of came out. But, you know, I think that just removing it, I mean, it's very different from being like some, a news that can actually push the markets higher versus news that just doesn't weigh in the market. I mean, it's nice to not have it pushing us

lower. Right. Yeah. Right. Exactly. It's the same thing of like what was happening with Mount Cox, for example, like, okay, when those, like, outflows got pushed back, for example, it wasn't pushing us lower anymore, but it also wasn't driving prices higher. And that's kind of where we are at with the MSCI news. But I think that people are definitely missing the bigger picture with all these banks coming into the space, like Jamie Diamond of JP Morgan actually now saying, hey, you know what, crypto is part of the, uh, great. You've heard me say it as far as I've never said otherwise. It's real.

And I mean, this is, I think I said it on your show, in fact, like two years ago where I was like, listen, you can't have your biggest client like, aka BlackRock coming in and saying like we're going to create crypto ETFs and we're going to go into tokenization and you don't have a plan. Because at the end of every year, like all these banks basically are given a grade, whether informally or formally by BlackRock, by other clients who say like, oh, you did really well in fixed income, you get an A, you did well, okay, in inequities B plus. Ooh, you didn't do anything in crypto. Well, I guess you get an F for that. And you can't get an F. So you have to like do something. And now we're seeing that happen with all these major banks.

Morgan Stanley, I think, has been one of the holdouts here. But incrementally and then all at once, they were like, oh, you know what? We're going to allow our like investment advisors to actually recommend this to their clients. Oh, you know what? We're going to create our own projects and our own protocols and put our own the ETFs. So I think that like a lot of them, and part of that is regulatory clarity as well. Part of it is the fact that like they know the regulatory clarity is coming and they can't be

behind the curve on this. So I think that all it's a confluence of events that are driving this forward. Yeah, I mean, Bloomberg Law published this article yesterday, today. Crypto's rules are here, 2026 will be about making them work. And that's sort of what you just alluded to, right? like things don't happen overnight. So the fact that we have the Genius Act and the accounting rules are squared away and Sab 121 is gone and we know that banks can custody, now it takes time to turn those aircraft carriers,

right, and to actually make a plan, but to the point of your colleague, Agostino from Coinbase, I think he was on CNBC yesterday or two days ago and he said, every institution now is a plan. That's exactly what you said. Like nobody any more could afford to not have a crypto plan. They're all coming. It's just a matter of how big. in what context. But I think that 2026, I think this is pretty accurate from Bloomberg law saying that, okay, now, you know, maybe we get clarity in a couple months. Now we know exactly

what we can do. It's going to be time to figure out what to do with it. Right. Because even once we get the bill, let's say it gets President Trump's desk. He signs it. I mean, like we saw the same thing happen in the Genius Act. The Genius Act was signed, I think, mid-2025. I want to say July, And basically the full implementation of that won't be until January, 2007. So I think in the interim, you see a lot of building, obviously, like you've got circle kind of getting like, hey, let's build out arc or, you know, like stripe and paradigm kind of like supporting tempo and things of that. And like now we're in this kind of like muck up like, oh, are we going to get like fragmentation of like multiple chains because, you know, a lot of same coin issuers want to do that. Are we going to see a unification of liquidity somehow? So these questions kind of come up.

Same thing is going to happen from market structure. I think that we're going to see that there's going to be clarity around, like, very likely, it's going to be the CFTC who is going to be the regulator for crypto. But then it's going to be like how do we implement this so that clients are protected. Are there going to need to be like statements that are produced quarterly so like clients can actually review them? Like what's that going to look like? Is that only going to be retained to like assets that are deemed securities? Are that going to pertain to like commodities as well?

If not, why aren't we calling for it for other things like, you know, like wheat and corn and soy, like blah, blah, like where does it kind of like fall in? So I think that until those things become more established, you know, we won't know what's going to the ultimate requirements for a lot of entities entering the space. It does feel like kind of as you said, the CFTC, like likely to be the main regulator for crypto. It feels like Atkins and the SEC are just sort of punting. Like, in a good way. They're just saying, listen, this isn't even our jurisdiction. Like, Gensler thought that he had jurisdiction over everything, that it was all his purview. We don't think so. Like, this is not really our problem. None of this stuff is securities. Figure it out.

Well, I think we're in a much better place than where we were, obviously, a much better place and we were in 2024 and 2025. In part because, you know, like there's always been this kind of, you know, I shouldn't say always, But there's always been this kind of conflict between the CFTC and the SEC. People argue for budgets. And they're like, oh, this is my jurisdiction. That's my jurisdiction. And it's, you know, we don't even need to talk about Gensler because it was very obvious that he had an agenda there. But, you know, he was actively taking like, you know, money away from Hester Persson, other more pro-cryptor members of that commission.

Whereas now we're in a place where I would say like Atkins is kind of saying like, Well, we want to create flexible rules, but still kind of abide by protecting people, because that's our job. So, yes, I would say, like, he's not, I wouldn't say punting because I think he's definitely trying to say, like, well, hold on, don't get us wrong. We still want to protect people. Like, that's ultimately our goal here. Yeah, I should have said he's punting on all the things that clearly should not have been under the SEC and is basically admitting that I don't, that this is not our jurisdiction. You know, like the CFTC needs to handle all this things. I think fraud is fraud, to your point.

And they're going to be very, very serious about cracking down on anybody who's breaking the law. But it's more like Atkins is just actually accepting what the job is of the SEC and saying it very clearly. Right. That, I think, is probably the best way to put it. Like, I think that he knows what this job is. But at the same time, he's saying, like, why do we have this onerous rule about ETFs coming to market? You know what? Like, it's actually change the standards because it shouldn't take 240 days.

I'm sorry, 270 days to get, like, for approval. And by the way, like, we're just kind of like punting like on the decisions of like which ETFs should be approved each time anyway, let's reduce it down to like 75 days. You know, like, so I think that's kind of his approach to this thing. He realizes that there's just a lot of like kind of, you know, padding that people do instead of taking real decisions. And he's actually trying to like get to that point. First, I don't know how much time you have.

So I want to be conscious of that. Do you have a couple of minutes? Yeah, yeah. I didn't know how long we had you for, because I have a lot more questions. But I would love your thoughts, I guess, just made me think of it when we saw the MSCI news on the Bitcoin and crypto digital asset treasury space in general now. Obviously, I think everyone agrees that we saw a bubble, you know, that in May, obviously it was all the hype that kind of continued through the summer.

Largely all of them have bought their Bitcoin and have not been able to raise money since and have not been able to find creative ways to buy more Bitcoin on the dip. So they're all sort of sitting there. So, I mean, what do you think the future sort of is of the digital asset treasury space or at least what we can look for in that area in 2026? I have to imagine you're doing research on that. Yeah. We actually wrote about this in our like a year ahead report as well, the crypto market outlook.

And I would say that what distinguishes debts from other things, first of all, was that, and I'm going to separate it into like what I'll call dat 1.0. What we've seen in the last dat cycle was dat 1.0, which would, of course, imply that there could be a debt 2.0. And I'm going to get into what I think a dad 2.0 cycle looks like. But what was interesting about this is despite how much support we got from debt demand into the crypto space in terms of price action, and we can argue back and forth about how long that lasted and how, like, durable that actually was.

But there were a number of skeptics out there for, and yourself included, We're just like, yeah, you know what? Like, don't get me wrong. I'm glad the price action is doing better because of the Dats, but I'm very worried about what this could mean to the downside. And we kind of got that in the second half of the year. I mean, like, it was. I'm not right about a lot of things, but man, I nailed that one.

Yeah. And I think that like, in DAT 2.0, it'll look very different from DAT 1.0. So what would I think a DAT 2.0 could look like? Because I think what we're seeing is that, Box space itself is valuable. And we've known it's valuable for some time, but we haven't necessarily traded it as the commodity that it is. Because now you're seeing people and these could be entities, institutions, utilizing it for stable coin transactions or tokenization, like, you know, people actually moving tokenized equities or tokenized assets, tokenized real world assets across Ethereum or other chains, for example, in a way that actually gives it more utility and value. that it hadn't previously. I mean, like, we always saw the future of these things. It's just

more that now institutions are getting into the game, and they need to utilize it. So if that box place actually has utility, there needs to be someone who actually trades it in a thoughtful kind of way. And we have that in traditional finance. In traditional finance, for example, soft commodities, primarily like agricultural commodities, like corn, like soy. Like you have entities like Cargill actually having entities that trade on the back. that or Trapegora actually trading it. And I think you can have the same in crypto where the Dat 2.0, like those model, that that 2.0 model could have these entities who actually are able to accumulate crypto or these blockchain assets on chain or, you know, whatever, like they

basically accumulate it, trade it, trade the duration around it in the same kind of way. And I think that it would be very different from debt 1.0 where it was just pure. your accumulation, where it was just like, hey, we just want to have the biggest stack of ether. We want to have the biggest stack of Bitcoin or Seoul. Like, I don't think it's going to look the same way anymore. It's going to be a matter of like, when to trade it backwards or forwards. We're going to like look at like the duration of the curve and like what the term structure

should actually look like for these things. And it's going to be traded very much like commodities in the chatify world. Yeah, I tend to be with that. And I think the cash flow is going to start to matter and just buy hold and pray, right? And even when I interviewed Bailey not that long ago, he said, you know, now we're pivoting to looking for cash flowing businesses that are in the space to give us, you know, a more justifiable valuation and ways to make cash to actually buy more Bitcoin. It's not like people aren't cognizant of it, I think, at this point. So I guess, you know, sort of finally, are there any other catalysts on your radar that you and I haven't discussed of late? Totally fine if the answer is no.

I mean, we've talked about clarity, obviously. We've talked about the digital asset treasury space. I mean, is there anything else maybe on the radar missing that could spark some more attention in the industry or specifically bring all coins back? I think that the internal sectors for crypto are also going to matter. And, you know, we don't talk a lot about this because we're always trying to chase like what's the catalyst for the next like few days or a week or so. But I think in the background, you see things like prediction markets, for example, growing. I don't have to tell anyone this. Everyone's aware that prediction markets are a big thing.

Stable coins are a big thing that like perps are growing. But like if you think about the incremental like kind of support that each of those building blocks actually have, perps, for example, becoming a traditional finance like primitive as they become a core financial primitive and like, you know, people and equities, like you're seeing more and more retail traders actually getting into the space, they want something more capital efficient. They want an easier way to get leverage and actually do this stuff. Perps are what we invented in the crypto space to kind of deal with that. I think that that's going to cross over become a really big thing.

I would also argue perps and then going 24-7, 365, also as a result of the precedent set by crypto. Absolutely. And I think that that is a backdoor, like, support mechanism for crypto as well. For the fact that prediction markets are growing so quickly. And, you know, like on the one hand, you know, that was. driven by legislation and the one big beautiful bill that affected gambling, for example. But I would say that you're seeing a lot of people pivot now towards prediction markets itself. Institutions actually saying like, hey, this is a way to kind of hedge yourselves.

Now, that might initially fragment liquidity, but then I think that prediction market aggregators are going to step in here. You're going to aggregate liquidity and other things. Like, I think that those kind of platforms are also going to be good for our space. You know, like the fact that like stable coins, again, like we keep coming back. to the stable coins being in the killer app, but like the fact that this is now not just being used for trading, but it's being used for remittances, cross-border payments, payrolls. I think that the fact that all this stuff is being integrated into the mainstream world and the mainstream finance,

I think all those things are stealth positive for our space. Yeah, I agree. I've, one of my thesis is that only is about 70% baked is that predictive markets have effectively been one of the silent killers of the all coin market. It's like all the people who couldn't find a place to gamble used to gamble on meme coins and even alt coins in previous cycles that we argued had fundamentals or utility and those people can just go gamble elsewhere. Basically the idea that you don't need crypto to speculate anymore, you can go speculate on the weather.

Well, I think that a lot of the themes I mentioned actually probably relate to, you know, like all coin markets having a very poor season because you know like if you weren't making your money in alts well you can't just do nothing with your cash that your capital has to go to work somewhere else and so i think perps for example were also a place where people put some cash like i think perps prediction markets all these things where people are like well maybe i should kind of like put money there instead because i still need to to have some gains or you put it into money market funds, it did nothing. And if that was the case, then you probably have a ton of capital that's now not getting paid anymore because I don't know about you, but like I had some

capital in there. And it was like, I got, I'm getting notices now that's saying like, well, now we've reduced our rates down to like 3%. I'm like, well, hold on. Three percent doesn't even cover me for inflation anymore. I got to put my money somewhere else. So if you're looking for a good real return, I think that you're now going to be getting back in the market. And I think that's also going to feed into like the first half of the year because a lot of capital is going to be coming off the sidelines towards like risk that actually turns a profit. Prediction markets are going to get so wild when people start using them to hedge and I guess we're going to see so much manipulation or you know like with all the things we've

seen in sports betting and the NBA and all these scandals and stuff imagine when these guys can bet against their own performance a politician runs for office and makes a million bet that they'll lose and then tanks it. You know, like we're getting to see some interesting thing. I don't think that'll necessarily happen. You'll be the Pete Rose of, uh, of, yeah, of, exactly. Awesome. I don't know who still gets that reference, but.

I do. I'd Charlie Huffle. That was his nickname, Pete Rose. See, I know things. He used to slide into first base, base first. He's the only guy who ever really did that. All right. Well, David, man, I really appreciate it.

As always, I'm going to let you go. I think we, uh, cook through a lot of topics there and always appreciate, uh, your opinion and your thesis. I've got to dig way deeper into your guys, 2026 Outlook, because I kind of hit the main points, and it's really constructive. And, you know, I think you're always on top of what's coming for the market. No, I appreciate it.

Thanks much. All right, everybody. We'll be back, of course, tomorrow. We've got Eval from Canton Network tomorrow. And then hopefully we'll be back with the Friday 5. Finally, with NLW has been gone for like a month. this Friday. So thank you, David. Thank you, everybody. We will see you tomorrow. Later. AI is reshaping the world, but right now it's stuck in the hands of just a few big players.

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