The Wolf Of All Streets - Bitcoin RIPPED 22% While Stocks Went Nowhere - Is Something Breaking?

Episode Date: September 4, 2026

Bitcoin is starting to trade more like gold than stocks, with its correlation to gold hitting a six-year high as concerns around bonds, the dollar, and debasement grow. Meanwhile, tokenized stocks are creating new controversy after AMC pushed back on Robinhood’s synthetic shares, while Arbitrum is benefiting from Robinhood Chain’s growth. Coinbase is also pushing for 24/7 stock perpetuals in the U.S., and Strive says it could become the world’s second-largest public Bitcoin holder by year-end. Learn more about your ad choices. Visit megaphone.fm/adchoices

Two and five Canadians will hear the words, you have cancer. That's why every step and dollar raised matters. On September 19th, join thousands in Toronto for the Princess Margaret Cancer Foundation Walk. Challenge yourself, friends, and family to walk 21 kilometers in support of life-saving research. Together, we can carry the fire and help create a world free from the fear of cancer. Register today at pmcfwalk.ca.ca. Bitcoin ripped 22% while stocks went nowhere leaving many analysts wondering if the correlation, which I put in air quotes, and I'll tell you why later, is finally breaking down. Meanwhile,

Bitcoin is the most correlated to gold that it's ever been in six years. Is something finally breaking here? We're going to discuss that, but dive much more deeply into Arbitrum and Robin Hood Chain today with Stephen Goldfetter from Off Chain. And of course, at the end of the show, I've got the weekly reckoning. Friday's. are shaping up nicely here. Let's go. Good morning, everybody. Happy Friday. I hope that you're all having a wonderful day. As you can see, the new corporate skyscraper of the wolf of all streets.gov.org has been built here on my left shoulder here on the New York City skyline. All right. So before we bring on the guest,

just going to cover one or two small things. Of course, this is the one from the title here. Bitcoin gold correlation hits six-year high. But analyst question whether equity decoupling will last. They should question that because Bitcoin is a beautifully uncorrelated asset. The very fact that we have to have a conversation about it decoupling from stocks and recoupling from gold and then decoupling from gold and then recoupling from stocks means that it's just a random walk in the park. And sometimes Bitcoin can be in concert with one or the other. But if it's not correlated over the long term to one or the other, then it is not correlated at all. I've always said that Bitcoin is a largely uncorrelated asset, which makes it the

holy grail of a portfolio. When you are an investor, forget all of the libertarian properties of Bitcoin for this very conversation. But when you are an investor and you have a portfolio, you want something with idiosyncratic risk. Even if it's 5% of your portfolio, you want something that's not going to necessarily do what everything else in your portfolio does. Unfortunately, sometimes that means that your thing will go down when everything goes up, which is what was happening with Bitcoin. But The fact that people are arguing that it was correlated to stocks when the stock market has been making all times high, all time highs while Bitcoin went down 55% is in and of itself insane. And now we're talking about Bitcoin's gold correlation hitting a six-year high when it's only been for about two weeks.

Maybe that should say Bitcoin gold correlation hits very low time frame six-year high, right? Not particularly accurate. So if you're wondering why Bitcoin kind of made the move yesterday over the past few days, U.S. Bitcoin ETFs report the largest. inflow since January worth $731 million from a technical perspective, if you do care. Bitcoin here is really at the most key level kind of on the chart right now. That 50 MA there on the weekly, a lot of technical analysts are watching. But of course, if it gets above this 82,000, 8 or 900 area, that would be a higher high. And all the bears are dead if that happens.

All right. So that is my brief thoughts on what's happening with Bitcoin right now. now I'm going to bring on today's amazing guest. We've got Steve Goldfetter here from OffChain. How are you, man? Hey, I'm good. It's great to be here. Hey, I'm good.

So like I said, last time I introduced you was of Offchame's Labs, the builders of Arbitrum. But, you know, now you've dropped the Labs, which I like. Yes, we still have a Labs component, but we've dropped it from our name, yes. So you obviously are heavily focused on Arbitrum, and I think one of the biggest news stories of the past few months, obviously, was that Robin Hood chain launched as an L2 on Ethereum, but using Arbitrum. Can you explain to us exactly what that means and how that came together? Absolutely. So for actually a few years now, we've had what we call the Arbitrum expansion program in production, which means you can take the Arbitram technology and not only build on Arbitram One, which is the core Arbitrum chain where many people, just call Arbitrum, but you can actually use that technology stack to build your own chain as well. And many different enterprises have used that over the years. I think it's getting a lot more attention now because Robin Hood is doing it at a scale that's never been seen before. And the revenue share

is also in magnitude reaching a scale that's never been seen before. But the idea is that arbitram has a dual strategy on the one hand. You have Arbitrum 1, which is one of the most liquid environments for DFI and a very, very strong environmental launch a product. But for those that want to move past that and graduate to their own environment, that works as well. And so we support both of these, and that is Robin Hood actually did both. So they started off about a year ago in June of 24, in June of 25, they announced that they are launching stock tokens initially on Arbitron 1. They launched about 2,000 tokenized equities in Arbitron 1. And in June, the in June of this year, the last day of June, they announced their chain, which went live July 1st this year.

and that actually now has their own Arbitrumb environment, and they can move seamlessly from one to the other. Okay, that's interesting. So theoretically, anybody can do this without having to work directly with Arbitrum because the toolkit is in place, right? So they're basically chosen as the superior toolkit, you know, and which is, I mean, that's even more, I think, bullish for Arbitrum

than if you had to do some sort of deal or something, right, or partnership. So to be clear, we work very closely with them. but there's two separate things here. Anyone, the arbitral software is open and usable for anyone to use. And the only thing that you do is, hey, if you're using the arbitral software and you're settling on, you're not settling on arbitram once. You're not paying fees to arbitram. You're asked to do a 10% fee share as part of the license.

But it's open. You can use, you don't have to talk to anyone. You don't have to, you know, if anyone else's permission, you can comply with the license. You can use it. You can modify it do what you want. In Robin Hood's case, we do also at OffChate and have a very strong relationship with them, where we are working very closely with them on the chain environment, but that's totally not necessary.

And we have, you know, there are many others actually that service Arbitrum software as well. For example, you can go to Alchemy and say, hey, I want to build an Arbitrum chain and never talk to me or my team or anyone at the Arbitrum Foundation either. So interestingly, I remember there being this sentiment at the beginning when it launched

that kind of didn't matter where they built it because the fees wouldn't accrue and, you know, Robin Hood, big deal. And now we get stories, I think, like this, one. Go ahead and bring this up. Robin Hood's new crypto network is printing cash at sending Arbitrum's token soaring, right? It seems that now that we've seen how, I guess, it should have been easy to predict how successful Robin Hood would be because it's Robin Hood. Yeah. That actually this is working very well for ARB, right? And I know not even to talk about

token price specifically for you. I don't know if you can do that, but this is actually very clearly a symbiotic relationship that benefits both parties. Absolutely. So the way that the arbitram economics are set up is that all the fees from Arbitrum 1 go to the Arbitrum Dow token holder. So that's actually unique. Doesn't go to the foundation or some private wallet. It goes on chain to the token holder controlled wallet and they can choose what they want to do with that. So it's just in the token holder treasury. That's number one. And 10% of the fees from chains like Robin Hood that use the Arbitrum stack and settle on to Ethereum or other non-arbitrum networks, they also send back 10% of their fees. Again, this is. This has been in place for years, but previously, even though there's been dozens, actually close to 100 different production environments that have used this, none have reached a scale of Robbenham. You see a chain collecting now several millions of dollars per day, 10% of that becomes very significant, and people are starting to pay a lot more attention to this business model. But this is the vision we had a while ago. It's the economic setup we did years ago, but it's finally hitting a scale that I think people are having difficulty ignoring. I think it's also really interesting that there was a prevailing narrative throughout the bear market that Ethereum was maybe dying, but that L2s were dead.

Right? I mean, you heard all of these as you were building, which I find so interesting. But that, you know, like Salana could do everything. So nobody needs L2s. Why would we have this clunky, you know, multi-layer system? Exactly. And the truth is that a lot of that even came from inside the Ethereum ecosystem that, you know, people had doubts of that are skeptical. But there are two things to note here.

There's the core scale part, which is, you know, Robin is doing. on the order of 12 to 15 million transactions per day, you know, Ethereum layer one can't support that, obviously. And, you know, Robin Hood clearly needs their own production environment. And the second one is there are a variety of reasons, even besides for scale, that one might want their own environment. For example, Robin Hood, even if theoretically Ethereum layer one could support Robin Hood chain, they may just want their own environment where they have custom compliance, custom futures. You know, they're running at a speed that's much, much faster than Ethereum or even other L2s. Robin Hood chain is running at 100 millisecond block time, which I believe is the fastest of any chain in production at all at native block time.

And these are the ideas when you have your own little environment, your own, as Vitalik called it in his original blog post on the layer two roadmap, you have your own little island. It's just something that I think people are going to want for a variety of reasons. You can customize it at will, whether it's branding, whether it's privacy, whether it's compliance. There are so many different ways that you can customize it. And we're seeing real demand among enterprise of your own chain. And by the way, there are two paths this is taking. If you look at like Enterprise, a lot of them are starting with, hey, we want our own chain. You know, Circle, Stripe, Coinbase, Robin Hood.

And there are basically two paths. You either launch an alternative layer one. And that's the paths that Stripe took. That's the path that Circle. Yeah. Exactly. And or you launch an L2 in Ethereum. And that's a path that Robin Hood and Coinbase have taken.

And if you look at it in that lens or the starting point for many of them is, I want my own chain. Ethereum actually is the only environment that actually has an offering, right? they're not going to an alt-l-1 and building an L-2 there. Either they're building an Ethereum layer two, these large enterprises, or they're building their own new environment. And to me, it's clearly a win for Ethereum. And literally, Ethereum is the only layer one that even has an offering that can talk this language.

Yeah, it's been interesting as I think about it to all the narratives we've heard in the last six months about L-1 and L-2. Because even Vatelik himself, you know, kind of came out and said that they were going to focus on scaling and all these things and that contributed to it. I think obviously a lot of the whore messaging from the Ethereum Foundation affected that for a long time, but now it's not even in dispute anymore. Yeah, listen, there are so many different reasons and people get like, people can play different things. Like, I'm not anti-scaling the Ethereum layer one.

In fact, at Offchain, we have a few products. One of them is prison, which is literally the Ethereum's consensus client where we contribute very, very significantly to the scaling of Ethereum layer one. And the reason is a scaled L1 is important for a scaled L2, right? We're not stopping at a couple million transactions, you know, in a day or we're going for the world's capacity here. And we're going to need all the scaling out of layer one to support all the scaling out of layer two.

And these two things are really not in conflict. And Robin Hood is a fantastic example. When Robinhood did their announcement a year ago in Khan, they had Vitalik there. And they were proud to say, hey, we're launching on Ethereum. And I was like to say, like, Robin is proud that they're launching on Ethereum. Why would anyone the Ethereum, you could assume like, no, no, no, this is not pure enough for us. It's not Ethereum. It's like, guys, take the win. It's a big win. They're shouting Ethereum. You should be happy. Ethereum is supporting them. They're posting their data on Ethereum.

They're posting their proofs on Ethereum. And by the way, they're creating a ton of demand for ETH. So there's been millions of dollars in fees in the last couple of days, multiple millions of dollars. All those fees are collected in EF, and that's driving tremendous demand for the EF asset. So I think there are some that have this like strange purity test, but in actuality, Robin Hood is doing something fantastic for Arbitrum and fantastic for Ethereum. Yeah, interesting that kind of push and pull of the private blockchains versus the public ones. There was huge news two days ago, three days ago that Citibank and Goldman and 21 other major institutions were coming together to build their own stable coin network. Right.

And the news hidden in there was that they were going to do it on public blockchains unannounced and not a private blockchain, right? And you have, as you said, Circle has arc, Stripe has tempo. And OpenUSD, which was the same kind of conglomerate of FinTechs, have decided. decided to use that tempo blockchain because it's led by them. So there really are a lot of paths, but watching Goldman Sachs and City and Wells Fargo say, we're going to do this on an open, you know, public blockchain means that there's a lot of options here and not everybody's going to take that private route. Absolutely. And that's a real, I think, symbol of the maturity that we have an industry have taken in the past, you know, five or so years. It used to be like

blockchain was this code word that institutions thought, okay, I need to do something on the blockchain, but there was these private databases. They didn't appreciate Ethereum, they didn't appreciate Network's like Arbitrum or the actual benefits you get and the security you get from being on a public blockchain. And many of the offerings were almost like a bit, you know, self-contradictory, which is like, oh, it's, you're calling it a blockchain, but it's just this database you host internally. I think now the institutions actually get it and they get not only the technology benefit, but also the benefit of being connected to this global network. We like to call it the programmable economy. You can join the programmable economy. And if you have

this little thing, you know, and you're running on your server inside that's not connected anything, you know, to use the analogy, if you have an intra network that's not connected to the internet, not very exciting, not very interesting. And I think institutions are appreciating the value that Ethereum and public networks bring. I just laugh at some of the comments like, Robin Hood missed. They should have built it on Solana. Like, you can't build Robin Hood chain on Salana. Isn't that kind of the point? Yeah. And by the way, so that exactly is the point. Yes. is if you want to chain, like I said before, you're in two buckets, your Ethereum layer one, you're your own layer one, your Ethereum Layer 2.

But even more so, if they would have built their products on Salon, think about it. Robin Hood has the power. They're attracting millions of dollars in daily transaction volume today. Where would those dollars have gone had they built them on Solana? They would have gone to Salana validators. That's a, think about Robin Hood, you know, and I think Vlad said it the best. He said, I want to be a landlord, not a tenant, right? He doesn't want to be just a tenant and someone else's.

chain. Today, they're driving Robin Hood chain. They're driving Robin Hood wallet. That wouldn't happen if they launched in Aetherm layer one. They wouldn't happen if they launch on Salana. They'd be basically contributing to the success of Salana validators. I contribute to the success of, you know, the popular Salana wallets like Phantom. But today, they're actually able to own the ecosystem and actually be the landlord here. And they're generating, you know, not only the revenue from their direct products, but also from all the others that want to be co-located with Robin Hood. You know, So if you have, you know, there's a strip mall and you have a very popular store that up to some people are coming, everyone in the strip mall benefits from that.

But if you don't own the strip mall, you don't really benefit from that at all. So Robin Hood, I think, is the landlord here. And that makes a lot of sense when you're the attraction that people are coming to see. Yeah, just for context. I mean, here, no L2 has ever generated more revenue than Robin Hood is doing right now. So, like, you know, this is another one of those classic cases in my mind of where we were just waiting for the, everybody built everything. and then everybody gets bored because it hasn't, then you get the proof,

and now we're going to see, you know, an absolute explosion here. We always do. Like we have our little, like, huge bubble, and nothing happens, and then everybody forgets, then the next cycle something takes off. Exactly.

Yes, we have a very short-term memory. Yeah. So digging in, just this is one of my favorite stories of the day, and I would love your opinion, although it's non-specific to Arbishop, obviously. AMC, CEO, Black.

Robin Hood for stock token, putting synthetic shares in spotlight. So if people didn't see it, Adam A-A-A-Ron, CEO of AMC, which I just find it so ironic because this is just a meme stock, right? I mean, AMC, like at the peak meme stock like craze with GameStop and everything, but absolutely freaking out that Robin Hood is tokenizing stocks that don't have the underlying rights and all of those things and that the price action of those stocks effectively can affect public markets. Vlad responded, what's the concern?

Which was like the most triggering thing he could have possibly done. And then of course, the guy goes like ballistic. And listen, he has some good points here, perhaps. But basically what happens on Robin Hood chain, apparently is that you can launch a meme coin. You can attach it to one of their actual tokens, you know, publicly traded tokenized stocks.

In this case, it was called meme. Right? I think we had one called Boner that went with Hymns. Mike Belchie, like a very serious person from Bitgo yesterday, came on the show. He's like, have you seen the erection meme stock? And right. And so we've seen stocks going up 100, 200, 300 percent because of what's happening with the tokenized version or its attachment to a meme. So I can just, you know, this is, we're in new territory here again, I would say with what's happening on Robin Hood.

chain and this might be the most unique thing they're doing, which is allowing you to like basically launch a meme token that's attached. Yeah. And it's not the first time they've seen some blowback. I think when they did the privatized shares early on like a year ago, they did some, you know, not yet public stock offerings. There were some blowback then as well. But I think I think this is, you know, this is progress, right?

It's the old guard. It's the horse dealers, if you will, you know, yelling at the car manufacturers. But actually, if you, like, zoom out, this is progress. And, you know, the old guard, obviously, is not going to understand that first is going to scream and yell because they think it's wrong. But it's not wrong. And to the extent that, you know, in some jurisdictions, this is not possible yet. I think that's the thing we need to fix, right?

When you say, hey, this is not SEC compliant. Well, obviously, Robin has not operated these in the U.S. But the question is, how do we get, you know, up to speed where this is, you know, this is possible in the U.S. and how do we, I think it's of the two things that need to be fixed, it's the legal system that's archaic and doesn't contemplate or understand the tokenized versions of this. But I don't think this is going anywhere. And I'm happy that you have Robin Hood actually taking that leap.

And I don't think this is different, like I said, than any other technological innovation where the old guard starts yelling and screaming primarily because they don't understand it. And as you pointed out, they don't understand the benefit that it's bringing them, right? This AMC stock is up. What do you watch? Exactly. Were they mad when AMC, like, pumped in the GameStop? to multi hundred percent and they were able to use that cash.

I mean, it's... Yeah, it's just new technology. You don't understand, you know, the reaction is to y'all and scream, but this is how progress has made it as a society. And I'm glad that you have really the Robinners of the world to push us forward. Right. What's going to be interesting is now when the actual market converges on the 24-7, 365, and whether that market itself becomes the tokenized version,

and then what happens to the Robin Hood versions of the tokenized version when we have actual tokenized versions. Excellent questions. But I think there's a real world in which, you know, I get a lot of reach out now from other like Wall Street firms and financial institutions say, hey, how can we do what Robin O did? And to many of them, my answer is, well, you don't necessarily need to.

You can actually just align on the standard and use these standards. So I think the one thing is clear. Fast forward five years from now, the tokenized versions will be the canonical versions, and that's the way that the market is going. In my mind, there's no doubt about that. It's so much better. You mentioned 24-7 trading, fast settlement, just market access. So, so much better.

But there is still the open question. As you said, what is that standard we're going to be a line on? But I think the first mover is like Robin and will have an advantage there. And I think you'll see others that are saying, hey, this is good. This works. We can just align on the standard and use Robinus to organization engine, you know, as the thing. And obviously it will change and improve over time as you have the ability to, to have direct custody, you know, the actual canonical version on chain.

But that could happen within this framework as well. But it's crazy when you think right now about how much impact our middle corner of the market is having all at once on Wall Street and financial markets. I remember my newsletter about it today. Cryptos isn't becoming Wall Street. Wall Street is becoming crypto. This was the idea that Coinbase is now, you know, filed for perpetuals on stocks. But the very fact that we're now bringing perpetuals to every single.

market, that perpetuals are allowed in the United States, that the SEC is having a meeting on 24-7 trading. The NASDAQ is going, you know, 23-5 prediction markets, which, you know, started the poly. People forget that the poly in polymarket is polygon, right? But like it started as a very crypto thing, are now on every single platform. And crypto has brought so much innovation now to financial markets. It's crazy. Absolutely. Yes. You know, we're having a massive impact. I always like to say, you know, I think sometimes we sell ourselves short where you say to someone, I've heard many people say, you know, where do you work to say I work on defy?

I've never heard someone say I work in Troutify. We have to realize that like defy is track. It's finance. We are a real part of the financial system. It's not this separate thing. And in fact, it's the next evolution of finance in many ways. And the good thing is, you know, like you pointed out, I think a lot on Wall Street are trying to realize that. And they're actually seeing the benefits of, oh, perps, that's a really good product.

And, you know, that's, that's innovation that obviously came out of crypto, but it's now, you know, taking over for equities, traders as well. And I think we'll continue to see this. And blockchain is not going to be this separate system, right? That's the beauty of what Robin Hood is doing, which is so many firms for so long, you know, institutions have had our real business and then our little blockchain sidecard, this little game we have. It's like, no, no, no. Robin understands the future of our real business is tokenized equities, is blockchain technology. and that's where the train is going, and you can either get on now or, you know, get on later.

I want to know who had Robin had the idea to attach the meme stock to the main stock. I'm going to ask Johan, because that is, I mean, it's brilliant. It's poking the nest, just enough. Yeah, I don't know. It's a good question. So then let me just bring up the story so people can see what we were talking about here,

but Coinbase seeks SEC, green light to list 24, $247. Equity is in from their own. We're working to bring single stock perps to the U.S. This week we filed. It's just crazy. 247, 365, longs pay short, shorts pay longs. I just never thought that, like, Arthur Hayes, bitmex would be how markets ended up running.

It's amazing. You know, it's just better. It's more efficient. It works. And that's progress. And I think, you know, when you're in the thick of it and you have so many people for so many years, similar to that AMC CEO, right? If you look back at, like, you know, what the,

the banking CEOs were saying in the past couple of years, everyone always wants to fight, you know, anything that challenges their rule. And, uh, and particularly when, when the market itself is trying to challenge centralized rule and trying to give more power to the people, which is what crypto is doing. Because if you want to innovate in the crypto market, if you want to build something like, you know, Robin Hood has put these stock tokens on chain, but like a lot of the manias coming from the meme tokens fair with the stock tokens, right? In the real financial world, you wouldn't have the ability to use these Legos and actually build products in top of that the way we do in crypto.

So I think there's a lot of, you know, the old guard questioning, and then there's a process of understanding, and eventually you come around. And I think this has happened for the banks in many way. So we have a long way to go, but this will happen for the AMC CEOs of the world as well. Yeah, so talk to me about what you're building next then. So you've, you know, you've been building for years. You see the success of Robin Hood chain, and they're doing all these novel things. So in context of all that, what do you build next and what do you foresee is coming? So the Arbitramp platform I view as a key ingredient in bringing the world on chain. And when I say the world, I don't only mean the world's, you know, fintech and trading

apps are really world infrastructure as well. We're very focused on financial infrastructure today. But I think even within that, there's so much, there's new assets, tokenized assets. There are new types of, you mentioned prediction markets. There are so many different flavors of this as well. So what I believe is, you know, what we call again. like I said, the programmable economy, and Arbitrum is going to power the program of the economy. And I think if you look for us, how does this play out?

Well, we have a few things. We have Arbitrum 1, and that's our public chain. And for many, like I say, that's a great place to start. Even Robin Hood began there. And for many, it's a great place to end as well. It has deep liquidity. And for BFI protocol, often that's what they're looking for, and that's the right place to be.

But for some that have their own distribution like Robinnaut, they're going to want to graduate to their own chain. We're the only ones in the market that can support both of these today. So Robin Hood started off in Arbitrum 1, launched over 2,000 equities there. a year later, they launched their own chain today. If you talk to my competitors, there were one of two camps. Either everyone needs to have their own blockchain or nobody should ever have their own blockchain.

But we're kind of in the middle and says, hey, start off here and you can launch your own blockchain. Eventually, you know, we have a lot of flexibility in the technology. So if you fast forward a couple of years, we're building the generalized technology that we can go ahead and customize for every aspect of the programmable economy. So we mentioned, obviously, Robin Hood is doing fantastically on the platform today. but Arbitrim is going to be a collection of these shining stars. We announced recently another partnership with LG,

which is building a chain for an ad network, the direct user ad network on their devices. And, you know, my goal today is not to say, okay, let's get more competitors in. They're going to fight over the pie that we have today, but how can we grow the pie significantly? And Arbitrim has really strong technology that's ready for enterprise scale

that can bring the world on chain today. We're going to continue to see that via new technical feature launches and new feature launches, et cetera. So let's say let's zoom ahead five years, you know, a perfect world. What can you do using, well, I mean, even maybe even non-specific to arbitram, but what kind of things will we be seeing? What will people actually be doing? Me as an American guy, what am I going to be doing with my wallet that I'm not doing now? So I think a lot of it is actually what you're going to be doing with your wallet and not even realizing you're doing with your wallet.

When I go on to my phone and order food on Uber Eats or DoorDash, I don't really think about the Internet stack underneath it. I just think about food coming to my door. Same thing when I order an Uber. But today, for many, when they go on the blockchain, it's a very deliberate action. I need to bridge my funds to Arbitrum and now we need to bridge a Robin Hood chain, need to exchange these assets. We're already starting to see this. If you go on the Robin Hood app in Europe and you buy a share of Apple, you're actually getting a tokenized share on Arbitrum today. And that, I think, is the future here where your financial apps that you're already using or your banking apps that you're already using might start doing things to say stablecoin settlement or might start, you know, have peer to peer payments.

Not as this other random app that someone, you know, got you to use that you never heard before at some crypto conference. No, no, no. Like your Venmo and your Zell and your PayPal, I believe, will all, you know, go onto these rails. So that's one. When I think about the future and where it's going, it's not only creating new verticals and, you know, markets, which I think we'll have a lot of those. You know, great examples of those are prediction markets and purpose, which, you know, didn't exist previously.

Arbitrum has been at the center of, you know, Perps from the very beginning. Purps really took off with GMX and Arbitrum, and every, you know, large Perps platform has had a connection to Arbitrum. Lighter started off an Arbitrum. Hyperliquid was for years, you know, exclusively funded via UTC on Arbitrum. Arbitrum has a very center here, but I think expanding out of that as well, we're going to see other large verticals built in Arbitrum. And so my prediction five years from now is Robin Hood will be, you know,

continuing to absolutely succeed and kill it with their stock tokens, doing a ton of volume on Robin Hood chain. And we'll have a dozen others that are doing similar success stories in their verticals. And that doesn't necessarily mean stock tokens or meme coins, but whatever success means in their vertical also built on their Arbitron platform and critically all contributing revenue back to the Arbitron Dell. So effectively, you'll be able to do everything you can do in financial markets, in one place and the fact that it's on a blockchain will be completely abstracted away.

UX and UI will feel entirely familiar to, you know, taking a loan on Schwab, if that's familiar to you, right? And you'll just do it, but it'll be with your entire, you know, asset stack and all of that will be tokenized whether you know it or not. Exactly. And there will be benefits of the block. There will be the advanced user setting where you can go ahead and take self-custody and go ahead and engage in yourself.

Similar to today, email is an open standard. up your own email server and you know you don't have to use any of the services but everyone basically just uses Gmail right and I think that's the similar thing that we're going to have here where there will be advanced users that are doing more things deeper on chain that want to have more direct plus the other assets and that's great but most of the people in the world if we're going to billions of users are just going to be using these you know some of the same financial apps they're using today but we're going to see blockchain settlement be critical to that and they're going to get benefits from that they're going to get 24-7 trading

They're going to get fast settlement, not have to wait days to see their money when they exit a position. Or they're going to get a lot of really strong benefits from the technology, even if they're not directly engaging with the technology themselves. And Arbitrum is going to be, continue to be at the center of the programmable economy with the Ethereum security as a back one. So let me ask you one more question if I let you go. So privacy has been one of the huge narratives. Obviously, we've seen certain tokens go for privacy, but. For example, Canton Network focuses on privacy for institutions.

Like, obviously, I think everybody understands the notion that Citadel doesn't want, like, their flow being seen by everyone on a public blockchain, right? So how does privacy factor into this moving forward on Arbitrum specifically or, you know, within Defi and within the way these things are built? So privacy has been something which we literally thought about from day one. If you look at the 2018 Arbitrum Academic Paper, so before the company was existed, We published a paper when you were at Princeton. Myself, my duco founders were at Princeton.

We published a paper. And the name of the paper is arbitram, scalable and private transactions. So it's been in our minds from really from day one. The thing is there's a great, you know, the market wasn't ready or didn't want it or appreciate it. And there's actually a graveyard of privacy products that were just too early for their time. And the reason is because back then it was really the blockchain enthusiasts. They weren't doing, you know, financial institutions weren't using the change at the time. people didn't appreciate privacy or understand there really is why they needed it.

But today, as we move, you know, institutions move on chain, they have a basic need for privacy, right? If everything I said, I just mentioned is actually going to happen. If you're, you know, Zell and Venmo transactions are going to go on chain, it's not going to be okay if, well, I guess Venmo kind of does it already. I hate that social picture. But like, assuming you have that, you know, turned off like I do, it's not going to be okay if your neighbor can go, you know, you pay your neighbor and then they see the entire your financial history, how much you have in your bank. account, who else you're paying. Like, that's not going to be okay. So we're going to have to get to the institutional notion of privacy.

What I mean by the institutional notion of privacy is the privacy that we're used to today. Many of the early takes of privacy, and even very good ones like Zcash, we're very focused on super complete privacy that nobody in the world can learn anything about me. That's one notion of privacy. And then the other hand, we have these no privacy systems where everyone can just learn everything about you. But what's actually going to take off is the middle ground, which is exactly what we have today.

When I go to my bank account, I know that. that the bank knows everything about me. And I'm not trying to hide that. They have my address. They know how much money I have. And that's fine. I'm okay with that. I just don't want my neighbor or anyone else that I don't have this vendor relationship with you know that. And that's the notion of privacy that I believe will take off in the blockchain. And the good news is it's an easier one to actually implement. It's an easier one to be compliant. And, you know, we are, have some deep technical work on privacy that we're working on an arbitrium that we will, you know, bring to market with the right partner.

that that's for these features and we'll continue to, to our research team really work on this. But I do believe that privacy is going to be much more important. And the only way that we can replace the flows is if we have this institutional notion of privacy where you can have a client vendor relationship, but not have to leave all your details. So it's coming. I mean, so there's no question that's going to be, it's going to be literally a necessity,

right? None of this can happen unless that is built in because you're never going to be able to build a financial system where everybody can see everything you're doing. Absolutely. Yes. Are there any other massive, like huge narratives or anything that I might have missed here, anything that you're building? So we, you know, what we're building at Arbitram and the way that I think the most important way to think about what we're doing at off chain also. So our role, which we didn't really mention is historically, I think there's been a bit of confusion in the theory of ecosystem. So if you go to Canton, you mentioned Canton. There's like one person, you know,

one party you talk to and they can help you in a whole. holding you know exactly what to build. If you go to Solana, there's also a much more centralization of entities. But then historically, I think that people, a lot of institutions want to build an Ethereum. And they're like, well, okay, fine, I want to build Ethereum. Then it's just like this long vendor list in front of you. It's like, okay, I can build on layer one. I can build a layer two. I can build a layer two. And what we're trying to do at off-chain is really say, okay, you're an institution. You understand the benefits of the blockchain, but you want to think about the product layer and above. I don't want to think on the institution layer. We can hold your

hand and guide you how to build an Ethereum. So at Offchain, we build not only Arbitral, we built Prism, which I mentioned, which is the Ethereum client. We also build Zero Debt, which is a full suite of wallet services and smart wallet and gas sponsorship, et cetera, where you can do really, really innovative things. And the idea is we want to bring institutions onto Ethereum via Arbitrum and you say, hey, you can come to OffChain and we can basically hold your hand the same way that you can go to one of these more centralized ecosystems. There's one party to talk to. We can hold your hand and bring you an Ethereum. And you only have to worry about their product and about the reason why Arbiter and Robbins relationship is so strong.

They are the best in the world of what they do at distribution and trading. And we give them the ability to say, focus on that. Don't worry about anything, you know, at this layer below. We're just going to give you everything you need to make sure that the product works well. And that's, I think, something which is working really well. And we're going to continue to do that with many others in many different verticals. Awesome, Stephen. I appreciate you coming on. I appreciate all the insight and great to see the success here. You know, and I think Robin Hood, Jane, in my opinion, this is just going to be this tip of the iceberg for what we're going to see now that people have realized what's possible. I agree.

You know? Absolutely. Thank you for having me. Thanks so much. Speak too soon. All right. Awesome stuff there. You know, I think, as I kind of said before, Robin Hood chain should have been so much more obvious how successful it's going to be with their level of distribution and the kind of customers that they have there and the things that they offered.

I mean, they came in. we're not, don't even talk about it now at this point, but that incredible, you know, yield product from the very beginning that you were able to get on Robin Hood chain with safe higher yields and, you know, that you can be on Robin Hood and could just click a button and get access to that without really knowing how to do much in crypto. I haven't, to be quite frank, because I'm kind of a boomer. I haven't even tested Robin Hood wallet, but the people who have told me that, you know, it's really like a one-click, you know, the bridging and all the complexity that we were talking about, that none of that really is.

exist there. It's all very, very easy. You just kind of send Ethereum from Robin Hood to there and you can do everything without understanding exactly what chain or how it's happening. So I think that, like I said before, we've kind of had these massive bubbles in crypto before, these excitement waves, whatever you want to call it, where people thought things were going to happen exceptionally fast, and then you wait a few years and all of those things quietly come back when nobody's looking or paying attention or really focusing on it anymore. And I really think that that's what's happening here. So, you know, listen, I'm, I have no idea how to trade meme coins on Robin Hood personally. But for all of those, for all of you who are, congratulations. It's good news

for you. So before we move on to the weekly rectin, rectining, reckoning, I want to call it the rectining. Can we call it the rectining? Reckoning, right? We didn't put the tea in there. I'll tell you guys about our every single Friday amazing partner here, which is People's Reserve. Did you see that their building was behind me? Check this out. I did this with Grockbot. Look at it. Do you see it?

That's their corporate headquarters. I did that with Grockbot. I'm going to be honest, I was very impressed at first, especially that we were able to match the pompal boos can to the sky. Do you look like pompal boos? but then we tried to put movement in it and stuff and like the building started falling and the logos started flying around in the sky. So I'm not sure we're there yet.

But we were able to do this, the wolf, and that there. And I think that that's cool, personally. But yeah, so listen, I've been telling you, obviously, about these guys every week. It's become very popular news that you can now get mortgages using your Bitcoin. That's one of their incredible products. But another one here is the Bitcoin Bond,

which we haven't talked as much about, although we've talked about it. because I had CJ Constantinos, their CEO and founder on the show, just a few weeks ago. But the basic idea here is obviously fascinating. You take Bitcoin, created a financial product around it, offering 100% downside protection with asymmetric upside provided by Bitcoin price performance. You literally, I know it's... But they've structured it in a way where you can't effectively lose money.

Here's how the bonds work, right? We've got the calculator, my favorite toy. I'll show you guys every week. Say you purchase $100,000 bond at a $4.5.5. 5, 4% interest rate. You're at diamond level owning PRN token. The Kager of Bitcoin, let's put it at 35%. You will, in five years after that bomb matures, be at 179,297 instead of 100.

Now, when you do two years, is when the party happens. 10 years, excuse me, 736,162. Even if you reduce the earnings of the Kager of Bitcoin here is 20%, it ends up at $294,520. The link is down in the description. I am participating here with my own money. It will be. And so, you know, once again, not a thing I would recommend unless I was doing it my own self. So now you know the best part of Fridays outside of obviously Stephen.

He was the best part of Friday. Stephen was great. But if I had to come up with my own best part of Friday, we have what we like to call here, the weekly reckoning. it is not what the hell happened, if you remember. You know, if Grockbot was making logos float in the sky, Pigsfield gave us a chicken and misspelled words. But we're going to go ahead and start, give you the whole weekend review. Here it is. Let's go.

That DJ is good. Who is that? Here we are on the weekly reckoning. Let's review all of the news that happened this week. And the first story obviously comes from Monday. Strategy has acquired 4,603 Bitcoin for $370 million, increased USD cash by $29 million, and repurchased $152 million of STRC. As of 83026, we hold 845,050 Bitcoin must be nice, and $6.71 billion of U.S.D assets equally nice, bringing net leverage to 0%.

So Microstrategy got down their net leverage, 0% have raised more cash. Some of that cash, of course, is being used to pay dividends and is basically runway for years to come to pay for STRC and other preferreds. And some of that cash can be used to close out some of the previous debt on the convertible notes to buy Bitcoin, to buy micro strategy, to do basically whatever they want with. But the bigger story here, obviously, is that they were selling Bitcoin towards the bottom to shore up their balance sheet and to give people confidence that they had an intact capital structure. and now the Bitcoin buying machine is back on. They had sold over 6,000 Bitcoin in total near the bottom, now buying 4,6003 Bitcoin in one week. I think their cost basis of this was just over $80,000, just below where price is right now.

The strategy buying machine is back on for Bitcoin, even as them being the only buyer in the market has been priced out and people are not particularly concerned. I think there's a much healthier market where strategy is not the main character. Now, if you're a strategy shareholder, you've been pretty massively diluted over the past few weeks, but that could be temporary if the price of Bitcoin goes up and their holdings rise. Bitcoin per share will rise with it. They're clearly making a bet that we are entering another full market. The next story of the week is one that's continued from previous weeks, which is that we've got

a bond crisis round the world. Japan's benchmark bond yields rises to three. percent for first time in 30 years. Of course, this comes on the back of similar stories from Germany and the United Kingdom. And of course, in the United States, where our secretary of the Treasury, Bessent, Bessent. I did one show recently where I said Bessent and Bessentzant, and Bessent, Scott Bessent, intervened in the bond market or announced that they would. We temporarily saw yields come down and then they once again skyrocketed. because the bond market did not believe him.

Many people believing that we are entering a global bond crisis and that that could put pressure on Bitcoin. So we got the rally when we thought yields were coming down, then yields go back up. I don't think any of it matters to Bitcoin, as I said at the top of the show. I think Bitcoin is entering a new bull market with renewed vigor and is largely ignoring the macro because it is a beautifully uncorrelated asset. but the narrative in macro now is likely to be the bond market, right? Job reports come, job reports go, inflation come and go, the bond market.

Nothing stops this train. Hyperliquid seeks U.S. foothold through cracked and parent payward and crypto perpetuals deal from Bloomberg. So everybody was there the day the Bitcoin skyrocketed, and then the back half of that move was the meeting at the White House when Donald Trump in that meeting actually said, Hyperliquid. He said that C. League was working to bring hyperliquid on shore. Obviously, the hyperliquid token skyrocketed. Well, here we are a couple weeks later, seeing that this is actually potentially maybe sort of happening. And that's happening under the parent of crack word. Crackin. By the way, another story I think that broke yesterday, it was like, crackin, crackin,

crap, crackin was going to delay their IPO once again for superior market conditions, which I think is a reasonable and measured approach to an IPO. They want to launch into a bull market that they think is coming instead right now when we're still having questions in a bear market. But it does seem like there is a potential path for hyperliquid to be onshoreed in the United States. It's going to be really, really interesting, right? So I think that this will happen through, I believe it's called Bipnomial, which is under the parent payword, and they'll be able to offer certain contracts and not certain contracts. But either way, a decentralized, perpetual exchange being legal to Americans would be a massive, massive unlock.

We will see what happens with that. City, Goldman, other global banks and asset managers team up on stablecoin venture. I mentioned this to Stephen in the interview earlier. The group will focus first on U.S. dollar stable coin for payments and digital asset settlement with a euro token, a priority for expansion. Nobody wants that. You guys just ignore that. Nobody wants the euro.

Nobody wants your euro token. But, hey, maybe one day they will care. is 21 of the largest financial institutions on the planet coming together to build a stable coin because they do not want to be dominated by Tether and Circle, even though they will be dominated by Tether and Circle. As Mike Belchie said yesterday, these conglomerates or consortiums rarely work. We saw one proposed for OpenUSD with a number of fintechs led by Stripe and Coinbase. Of course, building on tempo. This will be built on public blockchains, although we do not know which one yet.

So in the last few weeks, we got a few huge pieces of stable coin news, right? Obviously, we have Circle and Tether doing their thing as they have been forever. Then we had the OpenUSD announcement with the FinTech Consortium. Then we had the regional and local community banks coming together in 39 banking associations saying that they will be starting their own stable coin network because they're in the middle of the big banks and the crypto industry. And now you have the big banks coming together to talk about their own stablecoin network. Fair to say that stablecoins might be kind of a big deal right now.

It can be interesting to see how this moves forward. Of course, yesterday the big news was Bitcoin's fable. Golden Cross is coming and USDT may be a real signal this time. We did look at the charts earlier in the show, so I don't want to be redundant. But yes, we do have a likely golden cross between the 50 and 200 MA on the daily charts of Bitcoin, which historically is generally maybe sort of kind of good news, but sometimes it isn't. But maybe the big story is that USDT dominance is reducing. which means that the speculators are back baby.

When people start selling USDT for other crypto assets, it generally means that they think those assets are going to appreciate. And the final story that was big this week before the stories that were big today, New Jersey asked Supreme Court to decide who regulates sport betting on prediction markets. Supreme Court hasn't answered. They left them on red. But New Jersey right now is the first one taking this fight all the way to the top over whether sports betting contracts are the,

jurisdiction of the states or whether they are derivatives and should be regulated by the CFDC. Obviously, the platforms believe it's a CFTC. The federal government believes it's CFDC. But a number of the states are saying, whoa, whoa, whoa, whoa, whoa, we're the casinos, bro. That revenue is ours and wanting this to remain in the power of the states. That's all we got for you today on the weekly reckoning. That's all we got for you today on the show. Huge shout out to People's Reserve right there. Check them out in the description. their mortgage products and their Bitcoin bonds. Oh, look, they're also up there.

Shout out to my non-sponsor, LaCroix. Shout out to Stephen from OffChain, not from Arbiturum, but Building Arbitrum at Off Chain. And that is all we got. Monday is a holiday. You're going to miss us on Macro Monday. It's Labor Day in the United States, the day that you celebrate by not laboring.

See you guys soon. Two and five Canadians will hear the words, you have cancer. That's why every step and dollar raised matters. On September 19th, join thousands in Toronto for the Princess Margaret Cancer Foundation Walk. Challenge yourself, friends, and family to walk 21 kilometers in support of life-saving research. Together, we can carry the fire and help create a world free from the fear of cancer. Register today at pmcfwalk.ca.ca.ca.