The Wolf Of All Streets - Bull Market Over? | Crypto Town Hall

Episode Date: July 15, 2024

Crypto Town Hall is a daily X Spaces hosted by Scott Melker, Ran Neuner & Mario Nawfal. Every day we discuss the latest news in crypto and bring the biggest names in the space to share their insight. ►►TRADING ALPHA READY TO TRADE LIKE THE PROS? THE BEST TRADERS IN CRYPTO ARE RELYING ON THESE INDICATORS TO MAKE TRADES. USE CODE ‘2MONTHSOFF’ WHEN VISITING MY LINK.  👉 https://tradingalpha.io/?via=scottmelker  ►► JOIN THE FREE WOLF DEN NEWSLETTER, DELIVERED EVERY WEEK DAY! 👉https://thewolfden.substack.com/    ►► OKX Sign up for an OKX Trading Account then deposit & trade to unlock mystery box rewards of up to $10,000!  👉  https://www.okx.com/join/SCOTTMELKER ►►NGRAVE This is the coldest hardware wallet in the world and the only one that I personally use. 👉https://www.ngrave.io/?sca_ref=4531319.pgXuTYJlYd ►►THE DAILY CLOSE BRAND NEW NEWSLETTER! INSTITUTIONAL GRADE INDICATORS AND DATA DELIVERED DIRECTLY TO YOUR INBOX, EVERY DAY AT THE DAILY CLOSE. TRADE LIKE THE BIG BOYS. 👉 https://www.thedailyclose.io/   ►►NORD VPN  GET EXCLUSIVE NORDVPN DEAL  - 40% DISCOUNT! IT’S RISK-FREE WITH NORD’S 30-DAY MONEY-BACK GUARANTEE. PROTECT YOUR PRIVACY! 👉 https://nordvpn.com/WolfOfAllStreets    Follow Scott Melker: Twitter: https://twitter.com/scottmelker   Web: https://www.thewolfofallstreets.io   Spotify: https://spoti.fi/30N5FDe   Apple podcast: https://apple.co/3FASB2c   #Bitcoin #Crypto #Trading The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. This video was created for entertainment. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor.  Nothing contained in this video constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.

Oh, we have MemeCoin Joe on stage. Sorry, Joe, I'm responsible for changing the whole image from the Bitcoin OG, almost Bitcoin maxi to now the MemeCoin man. Talking about MemeCoins, by the way, MemeCoins, I didn't know they dropped by, all the top five MemeCoins I tweeted about it dropped by over 10% today. How serious do you think that bleed out is in the meme coin world before we kick off the show? I'd say it's pretty serious. I just logged on today and I looked at, I was looking at Slurf, which went crazy. And it just continues to kind of keep

bleeding out. I was looking actually kind of diving into some of the community posts and you know you could you could see people are still trying they're holding they're hanging on um but it's it's a tough narrative to to stay on right like what like what's the point um you know you've got things that come out there you know they attract the trading community the exchanges list these things, and then the trading community kind of goes somewhere else. And the main trading community, when you're, you know, looking for things to trade, you're looking for volatility, right? And so if something doesn't have volatility, and the volume is down, you know, who are you trading against? And so it's tough to kind of paint a chart that makes sense on a lot of these things.

What happens is you get a lot of volatility, a lot of up and down in the first six to eight weeks and then 99% of it dies and then some things will come back. But it's a tough spot right now. I'd say everything kind of flows and stems from Bitcoin. We've just kind of been moving down. We've been posting a lot lately about how the number of interactions even yeah i think someone muted you by accident by the way i'm trying to bring you up uh so rob i'm trying to bring you up as to shama it's not working for some reason um so if the i'll tell the the the organizer to try to bring you up it's

not working on my end sorry joey talk about the number of interactions and you got muted by accident by i think the host all good all good yeah i feel like space has been uh struggle bus lately and you know elon should probably spend most of his time on that versus uh maybe some other things because you know and finally kill the clubhouse but anyway i i would say you know we're it's it's the dog days of summer right and you know people are trying to to look for narrative they are trying to look for narrative. They're trying to look for something to trade that makes sense, that's positive. And that's okay. So it's like, put your head down, build,

do your research, get ready for the next one. Yeah, I'm sorry. Just to bring up the speakers. But talking about the, I was just going through Slur, for example, it hasn't gone down that much. I don't want to kick off the show talking about meme coins,

but it's, you know, down 50% in the last in the last month yeah i mean that's a pretty good haircut um you know it's a 70 off you know some of the highs which you know it's still it's still holding i would say better than some for sure so if you're paying attention to that market and that's what you want like yeah that i bring up that name because it's a name that a lot of people know um and you can kind of point to to look at a chart that is that's what a meme coin chart is going to look like um and so kind of you know standard but meme coins did that in the last cycle so it's like nothing new nothing too concerning if you look at it from that perspective like it's pretty expected so my tweet is hey, is this just a correction or the end of an era, the end of the meme coin narrative as a whole? I'm heavily leaning to just a correction.

Is there any fair argument to be made that, hey, meme coins as a concept could be coming to an end? Doubtful. I would say I'm sure a lot of people want that to happen but i mean like this industry was kind of like built out of like cyberpunk you know gamer type people like you know until that that era like goes away and those people like you know you know and everyone's just so young in this industry it's like you're just going to see tons of interesting mean points being launched like every you know all the time for the eternity of this market let's kick off a discussion on the markets and obviously you could jump in on that one as well joel dave uh just talking about the markets your thoughts

what we're seeing the choppiness we saw on the weekend is a drop below 55k now we're up to over since 57k the fear and greed index is a lot worse than i expected as well obviously i have to do my homework today since scott is not here and i'm looking at him like fuck i didn't know and someone else tweeted as well um let me try to find a tweet, and I'm going to read it out. Any bullish post is now swamped with people saying it's copay or bullshit. Love to see it. I'm a cockroach, can live in another bear market being happy because the sun always comes up eventually. That's by Gumshu. This kind of feels like I'm living in my own bubble.

My team called me today just like, hey, is the strategy changing? I know we're still deploying capital on a daily basis. Same strategy as always, just a bit more cautious uh doing more media marketing tokens than just investment um we're still pretty exposed and i'm living in that bubble where this is all expected but it seems a lot of other people are taking this pretty seriously well i mean look i have a few points first i want to go back to the meme conversation. The meme coins and many other crypto assets, by the way, I mean, if you look at how oversold things like Chainlink are, you know, it's hardly just meme coins. But there's a lot of assets in the crypto sphere once you get beyond Bitcoin, Ethereum, Solana, and a few others that are, people say they're related to volatility, and that's sort of true, but not really.

They're related to momentum. So, you know, if you look at momentum as a factor in factor investing, it is dramatically higher in a lot of these, in the altcoin universe, particularly meme coins. People buy it while it's going up. And the reality is that when you get into a long sideways kind of entrenched market, there's no momentum anymore. And as momentum bleeds out, it's not remotely surprising that coins or assets that are mostly attracting momentum are going to correct the most. Will some die? Maybe. I mean, if you look, most of the majors didn't die the last time this happened. But the fact is, that's why the volatility,

the longer term volatility of meme coins is so high, because it really is an exposure to momentum as a quantitative factor. And you could have whole geek conversations about that. But it's simple. The best reason to buy a meme coin is number go up but what happens when number goes down well people sell it well okay and then some stick it in their portfolio and forget about it uh and often that doesn't really work but it is what it is so it's important to understand that the second point about meme coins that i read this morning which was actually very accurate is what drives meme coin rallies is people taking profits from the large cap coins and then redeploying it into something which they can make number go up even faster. Well, we don't have that

when we're on 130 some odd days of a range or toward the bottom of that range. That's not happening. So it's not remotely surprising that those sorts of coins are correcting more. The truth is, is whether it's there to stay or not. I mean, I personally think that at some point in the future, you will end up with a rational regulatory environment, which means that people can be given economic incentives to hold on to coins, which they can't right now, at least not in the United States or in a lot of places around the world. And so pure meme coins will probably morph into something else. But the expression on meme coins that I've always left with is a comment that was made in the Internet bubble is, what's the worst thing that can happen to a Internet stock? And the answer, the tongue-in-cheek answer was show a profit, because now you have different metrics to measure them on. And so it really is interesting.

Now, as far as the market, look, I tweeted it this morning. I think that what you're seeing is something pretty basic. The selling is from Asia. The buying is from the West. The buying is patient. It doesn't chase it. It's there. And the selling seems to be in front of Mt. Alcox

or potentially making bets on this expiration that's coming up. And, you know, if that's true, then that means Friday would be the end of the sell-off, and you'd get back to probably floating back toward the middle of the range again. Not calling for an explosive bull market this summer, not unless there's a catalyst, but, you know, it really feels like that. It feels like, yeah, the range has gotten wider. We're a little lower than the major range was. But, you know, on the workday. The sell-off was then. And then the bounce happens when asset allocators in Western Europe and the U.S. start waking up. I'll just briefly respond to the tokenomics thing. Yeah. So I think I differ in opinion from Dave on this. I think in terms of like real incentives to hold on to tokens, I think,

A, we're very far from a regulatory framework that's going to allow that under the securities laws. And B, in order to pay that type of, quote unquote, real yield, you need to actually generate a lot of profits, which very few projects are doing. Some of the big DeFi protocols are, but in general, these things don't trade, and I don't think would trade at a rational sort of PE ratio. As regard to meme coins, we've seen what it looks like when meme coins go all in on incentivizing people to hold them. That's what happened last cycle with the OM forks, right? Coins that did nothing, but had tens of thousands of percent APY just through inflation based on nothing. And, you know,

definitely you were rewarded for not holding in, order for holding and staking, and you were greatly punished for not holding and staking. And those things, you know, went to zero. So I don't know, like, you know, memes, insofar as they're going to continue to be around, and I think they probably will, it really is, I think, just about the meme value. It's does someone find a joke funny? Does someone have a sort of quasi political movement around something? I don't think fundamentals, or tokenomics are going to just about the meme value. It's does someone find a joke funny? Does someone have a sort of a quasi-political movement around something? I don't think fundamentals or tokenomics are going to come

into the picture in a meaningful way to change things. And Zach, just before I ask you another question, for the panel, I cannot see everyone on the panel glitching a bit. So make sure if you want to speak,

put your hand up, but also feel free to jump in if I don't see your hand. That helps me a lot. And then your thoughts, Zach. First, any updates on, is there anything interesting, any major news in the last three days that I might have missed? Because I see a lot is incoming this week. It's going to be a pretty big week for crypto. And I'll go through some of the reasons why. But there hasn't been anything major over the last three days,

unless I missed something. So that's the first question, Zach. And then your thoughts on the market kind of response to Dave. Yeah, so not the last three days. The thing I've really been tracking, though, I don't know how much you guys talked about it was the the Binance decision by a court federal court in DC that found that BNB was not a security. I think this is the first sort of, no, you know, disrespect to the ripple judge. but this was the first like careful decision that found uh that a token was not a security uh that actually might stand up and you know it's going to have to be decided by the circuit courts i think the ripple decision which did a similar thing was not well written or well reasoned but that decision was like what a week ago now

why hasn't the market taken it the way we would have expected it to? That's a pretty major decision. Yeah, I don't think the market generally responds to crypto law news. It didn't really respond that heavily to developments in the Ripple case other than headlines. It doesn't respond negatively when you get really bad rulings. The Coinbase motion dismiss ruling, I think, was very bad for the securities law status of tokens. The market didn't really react to that. I just don't think this is a thing that in the current market tends to be market moving, even though it deserves to be. In terms of the overall where we are in the market, right, I think the question is, is

this a bull market correction or not? Nobody knows. But, you know, I still think and sorry to be a broken record every week about this. But there is still, you know, I think the main story of there might be an institutional bid for the majors. I have friends who are in sort of traditional finance. They're all sort of talking about, oh, I would buy Bitcoin if it was in the 40s. I think there would be a big bid for the large cap you know institutionally approved coins um at some level and then i think the vc tokens are like doomed i think the you know there's

going to be such a massive glutton over supply of the tokens that hurts that hurts that hurts well we do have sorab he saw me and you would be probably hurt the most on this panel if this is true do you agree with zach and others on the probably hurt the most on this panel if this is true. Do you agree with Zach and others on the panel, by the way? There's a lot of them ringing the alarm on VC-backed, VC-funded projects that have been flooding the market and not doing as well as we would have liked. We'd love your thoughts on it, and has that changed the strategy for Jump Capital? Is Saurabh speaking, or is it my end? I don't think you're unmuted. If anyone can hear him, let me know.

But, Saurabh, are you there? Mr. Sharma? We can't hear him. Yeah, I think it's glitching for you. Anyone else here on the panel? Because I can't see the entire panel either. I don't know who's here. But Joe, actually, Joe, you're here. I see Joe here. And I'm just going through my other accounts. I see Alex Miller is here as well. So yeah, Joe, the question is to you, after we fix Saurabh's mic, to understand jump capital strategy, your thoughts on VC-backed projects, because it just, everyone seems to be bearish on them, for good reason, like the valuations and the amount of projects.

But can't you, there's another kind of argument to be made to this. Like, okay, the valuations are high, but then crypto is a lot more mature now than it was previously. A lot of these projects are being able to actualize their visions. Like a lot of Web3 games in the previous cycle maybe they raised at a lower valuation but they were far away from launching a game now we're seeing some of those games you know hamster combat being an example pixels being another and today i spoke to another project incubated by binance that we'll be investing in um and the amount of users that

have a you know again hamsa combat the third fastest growing app gaming app period and that's something we haven't seen in previous cycles even with axi wasn't to that level yeah i think you know when you have this market and you have cryptocurrencies and and the different model for venture capital to invest in with tokens versus equity you know the normal unlock on an equity backed investment, you know, first off, like most, even equity backed investments and startups go to zero, just like all tokens. So it's like, that's not a new model. Everyone's always like, all the tokens are going to zero. It's like, that's literally like the venture capital model,

you know, 98% of what you're gonna invest in is going to zero. You know, some of the better, you know, venture, you know, companies have a higher hit rate than that, but on the whole, that's where it ends. But I think when you have such an attractive model here where you can invest in a token and be unlocked in eight months or a year and a half or two years, it's just a better model for venture to be unlocked that quickly and to return that capital in different ways to you know whether they're staking opportunities or anything else if you're international i mean a lot of people have a competitive advantage there um over some of the

the venture in the us so i think that model is is better and it's just going to continue and i don't think it's the end of you know venture and so it's not the end of venture-backed tokens that are going to just kind of continue to go out there and they just take it they just take a shit ton of swings and and that's why we have so many different things out there we have 10 of the same things you know if you yeah i think you dropped out joe can you hear me uh i can hear you can hear me all right can anyone hear you yeah i can hear joe you can still hear him yeah can anyone hear me i can hear you mario we all hear him, yeah. Can anyone hear me? I can hear you, Mario. Make sure that he knows that it's not glitching on me.

Joe, I just want to disagree strongly with sort of that sentiment. To repeat what Joe said, it's that, you know, at the end of the day, these are risky just like equity startup investments. Guys, can anyone hear me? Yeah. Joe, can you hear me? I can hear you. I don't know if you can hear me i just dmd if you can guys i don't i don't think mario can hear any of us right now yeah i think we're up yeah yeah i think it's glitching for me yeah yeah i was glitching for me now uh

dave i'd love you to let me it's glitching for everybody so space is playing up dave if is dave on stage or is dave not on stage either can you not hear me uh dave see if dave's on stage or is Dave not on stage either? Can you not hear me? Let's see if Dave's on stage. Oh, Dave is on stage. Can you hear him, Joe? Can you hear Dave? Up over. All right, Dave, the space is all yours. I'll be back.

Let me drop down and come back up. Space is all yours, Dave. With great responsibility, whatever. Great responsibility becomes great whatever. Okay. Well, whatever that means. Someone else was – I think Joe was talking, so why don't you go back to it? Yeah, no, i think zach had a

comment on yeah for sure i just want to respond to some of what joe said right so the points you're making joe are that you know a lot of startups go to zero it's a rickety it's a risky early stage equity investment that the lockup is longer uh but that makes tokens more attractive for vcs and vcs might want to stake tokens etc i think there are a couple of things that are very different. I think primarily the incentives are very different. So first of all, the short time to liquidity, I think, brings VCs with a different mindset when you do venture deals. Right. And I work on crypto venture deals.

I also work on traditional venture deals. The dynamics couldn't be any more different between traditional startups and crypto. In traditional startups, VCs vet things as a long-term investment. They ask really hard questions about moat and profitability and what problem are you solving, and how does this business model work and how does it scale? And with tokens, really, it's just a lot of negotiation about the FDV, what's your marketing strategy, et cetera. And you see crypto VCs try and get liquidity as early as possible. Whereas you see, you know, if you're a traditional VC and you have a startup that you invested in your portfolio that's going well, you are jealously guarding that equity. You are exercising your

prerata every time you can to own as much of the company as possible. And if anything, arguably, you know, traditional VCs wait too long to distribute either profits or shares after an IPO of a successful investment to their limited partners because they want to get credit for all of the benefit that comes with that company's stock price rise and its profitability. With tokens, there is an understanding based on the way that the crypto markets actually work that these things defy gravity and that they can reach they can reach deck of billion dollar valuations without reaching product market fit. And, you know, you can say that crypto is more mature and in some ways the tech is more mature, but there are so few things I would say that have actual product market fit that are doing something better than the legacy system at this point. I think Bitcoin is better than gold in store value. I think stable coins are better than international wires. There are some very interesting tech that's been built around DeFi and DAOs, but I don't think DeFi

is by and large better than any centralized exchange. And certainly there aren't DAOs that are functioning better than Delaware C-Corps at this point. And so it's all kind of an experiment. And it ends up being the shell game of being able to dump sooner. And given that that's the case, the giant VC overhangs in so many of these projects, that's what I think is creating this sort of doom scenario for the VC tokens. Yeah, I think all that's fair. But if you were going to ask a venture capitalist that, hey, you're going to do all of those things that you said, right? They're going to do a ton of due diligence. They're going to look at the long-term plan. They're going to talk to the team.

It's like, hey, you get to do all of those things. But also you have this unlock option a lot earlier. Right. And I think that what that saying is that the model potentially, on the crypto side is just a better model, right? It doesn't change the fact that great venture capitalists could could be in that model and do all of these amazing things and try to protect what they're doing and try to be long term. But But also you have this other option here that gives you more optionality to liquidate. And I think any venture capitalist would say, oh, sweet, I get all of these. I get my cake and eat it too.

And so I think eventually you'll get everything to bleed into that. Do you think the VCs who got in the seed stage of Uber or Instagram or a company like that want to unlock earlier? Like, no, they want to jealously. No, of course not. Of course not. But I'm saying if you said, hey, you get to be an Uber. Right.

And like, technically, they can unlock earlier with secondaries. They could sell their shares, especially like look at what's happening at OpenAI. But I think they do sell the coins shadily on the secondary market for a deep discount. And the SEC is looking at VCs for this right now for some of the secondary market for a deep discount and the sec is looking at vcs for this right now for some of these secondary market practices the vcs don't have long-term conviction in these coins by and large what what just i'll just go to the great sorry guys i think the the just real quick the token vc game sorry go ahead joe yeah go ahead before the great the great venture the great venture capitalists though they're not going to just be like selling coins on the side, right?

Like the top 20 venture capitalists have returned, like the majority of the return in the last 20 years, right? And so I think those people, all I'm saying is that it's a better model for the better people that are getting involved and all roads will lead there eventually. But that's not true. The best crypto VCs, the ones that have returned the most money to investors are the ones that ruthlessly sold the top especially talking about entries in founders fund i'm talking about the equity side people used to yes those people eventually will flow towards the

token model it's completely different so wait if i if i can jump in here i think the issue is you guys are talking about two entirely different games that VCs are playing. Like there are the top tier long term VCs. You know, I do a lot of work with Union Square Ventures. Those guys have returned 25x on their funds and like they don't play weird secondary market games on things. They're freaking great long term investors. You have other folks who are literally just like basically trading meme tokens and are absolutely dumping on retail. So it really depends on what the game that people are playing.

But I think a lot of the VCs who made the jump to crypto from, I'll just call it quote unquote traditional tech investing, and are doing more like company and infrastructure plays that maybe there's a token attached to tend to hold longer maybe maybe they de-risk a bit when they get uh some increase on it but for the most part are doing are holding longer versus maybe the totally crypto native ones uh can i ask alex zach joe the question to all three of you, what are the discounts? I've never looked at those secondary markets. What are the discounts that you see

on those secondary markets for the SAF? So for the audience, essentially there's markets where you can sell, when a VC has a lockup period, they've got a SAF and you receive your tokens over 6, 12, 24, 36, 72 months. And sometimes there's a big cliff, you don't get unlocks to like a year later sometimes you get unlocks pretty quickly within uh since launch um but the question is so

what what there's markets out there where you can actually sell those softs to other vcs or other investors at a discount which shows you know it's not really how a vc should operate it's more of a trader that's playing the vc game but what discounts are you seeing on those vc marketplaces guys you know like market is 20 discount on like a six month vwap so like the volume weighted average price on six months the previous six months of however your token was traded yeah you kind of start negotiation at 20 off of that but that depends on the 20% for what lockup period for six months lockup? Much, much steep. So that's, if you're have liquid tokens, and you're

negotiating, that's the lockup you're going to do if you're selling in a liquid SAF. First of all, most warrants and SAFs that were created this cycle don't allow you on their by their terms to sell on the secondary. Now people do it anyway, right? They try and get around that. And you know, who knows if that's gonna be enforceable when these things actually unlock. But for actual SAFT, in the event that you're actually able to sell them, it tends to be much cheaper discounts. The exact number depends on the project, it depends on the liquidity, it depends on sort of the narrative

around that project. I don't think that there you can say that there is one market term at this point, other than if you're selling truly liquid stuff, there tends to be huge discounts. Because I think in the back of VCs minds, they are writing off tokens that vest in late 25 or 26 to zero, right? Like they are making calculations about can we get our money back and then some in the first couple unlocks? Yeah. So if you haven't, I was seeing on the liquid side, Oh yeah. I would say on the liquid side,

even, you know, for stuff that was listed a few, you know, even a few months ago, I was seeing people asking anywhere from 30 to 50. I think I even heard a couple of people asking for 60, but like 30 to 50% discounts for one year locks was what I was seeing as the norm from talking to people.

On liquid tokens, right? So imagine – Yeah, on liquid tokens, but with locks for a discount. Interesting. And then what about – so that's for 12-month locks, you're seeing a 30% to 50% discount. And then what about longer lock-up periods? Because obviously that's when the bear market hits and everything drops 80, 90%. Yeah, I wasn't talking longer locks with anyone, so I didn't get a read on that, but I would imagine it was even higher.

Think about the incentives, right? If you're a VC, let's say you're a good VC and you're not investing in these ridiculous FDV rounds, and you managed to get into a seed round at a $20 to $50 million FDV. $20 is really hard to get nowadays, but let's seed round at a $20 to $50 million FDB. 20 is really hard to get nowadays, but let's say you get in 20 to 50. And then some of the tokens are liquid, but none of your warrant or SAF tokens have unlocked and they unlock linearly over two to four years, which is sort of the market term. Think about how you would value that. Your cost basis is very low. If you can sell it at an

implied $100 million, $150, $200 million valuation for a token that's trading in the multiple billions, that's still a really good deal for you. And so I just say this example, if you're a VC, your incentive is to sell it, even if it's an 80% discount, even if it's a 90% discount, if you're getting a pretty decent multiple, and you don't have to worry about what happens in late 25 and 26, after everyone, the team, the insiders, everyone's been dumping for a year and a half, that's a huge win. But then who's buying? But Zach, the counter argument to this is who's buying those softs as well? Those are other VCs that are playing the VC game properly. Some are VCs. But I actually think one of the sort of like hidden

narratives of this cycle that I think we're going to see is the sort of people who were exit liquidity for liquid tokens last cycle. A lot of them, you know, if they have the means to be accredited investors are exit liquidity in the private markets this cycle. I think there is a lot of dumb wealthy retail. I think there's a lot of overseas funds, especially in the Middle East and Asia that are, you know, willing to buy these projects and family offices and stuff like that who are sort of less sophisticated than the VCs who are able to get into the early round. But those secondary markets are pretty good for avoiding the dump on retail that we saw in the last cycle because then these paper hands are selling it to diamond hands on the secondary markets would you agree no i mean like it depends if you're selling liquid tokens right and you're adding a lock up maybe you can make that argument if you're talking about selling safts or warrants you still have the same you know assuming you're allowed to do it you have the same

unlock as the original vc had so that yeah but i mean if someone buys it on the secondary market with a big discount you'd expect them to hold it long term oh no no right because let's say that you're selling it at a 80 or 90 discount to what let's say that the insider unlock hasn't happened but the token is live right so you're selling it an 80 or 90 discount to the you know vwap price of the token at the time uh the person who's buying that paper is saying listen i'm buying something for 10 or 20 cents on the dollar if i can sell it even for 50 cents on the dollar i am way way way in the money and so like you still have someone who's imagining they're buying it at a huge discount and they're going to make money by selling as soon as they can

especially if the price has gone down my guess is that they're not going to get any money out of that that 10 to 20 cents a dollar for some of these things is, in fact, way too high a price to pay for these secondary SAFs and warrants. But I don't think the psychology of the people who are buying these on the secondary is any different. Let me go to Dave and Dan, just kind of going back to the markets. Guys, there's a tweet that Ran put out in his show. Unless, Dan, you have comments on the current discussion before I go back to the markets? No, sorry. I didn't realize my microphone was open.

Sorry. No, good. No, good. Yes. So he put a tweet. I'm sure you can read it out here by CryptoJelly. Bitcoin has confirmed a higher timeframe, lower low, meaning the uptrend we were in for the past 18 months is under pressure. Reclaim it quickly and we can act like it never happened.

Until then, caution pays. So that law, I'm not a technical analyst, so there's probably something that Scott would understand, Rand, to a lesser extent. But that was the 55K mark. Yeah, I think the lower low was about, yeah, below 56K. So how important is that support level? I can send you through the chart, Dave.

Dan, I don't have you on WhatsApp, but I'll send you through the chart so you can see it and I'll try to pin it above for the audience, Dave. Dan, I don't have you on WhatsApp, but I'll send you through the chart so you can see it and I'll try to pin it above for the audience, Dave, so you can explain it to us, give us your thoughts. And Joe as well, you're a technical analyst as well.

Give us your thoughts on this. Dan? Yeah, look, I'm not a technical analyst guy. I think technical analysis is astrology for men. I don't see stuff by drawing lines on charts. So I'm completely out on this one, sorry. That's all right.

We'll get your thoughts on the markets afterwards. Dave and Joe on that same question you know look just for background for the audience so i used to run a company called two sigma securities or which was a market maker we took the other side of retail the same way the citadel susquehanna and other people do and the one thing i can tell you with absolute certainty is no technical analysis, single indicator actually works. They just don't. So I know that that pisses people off to hear it. Now, can you use technical analysis alongside other factors? Are there things which, when confirmed in toto, can create trading opportunities? Yes. And that's why swing traders can make money. So I think that that lower low, which was carved out on no volume, and you return to where the average price is of the lower, any volume weighted average price of any indicator doesn't show that is bullshit. on the spaces. We saw something that we didn't use to see. We used to see constantly in the world of Bitcoin, but more people aren't that dumb. We saw a almost 1,500, let's see, 57.2

to 54.8. Okay, that's actually bigger than that. So we saw over a $2,000 red candle in dunks going down. Obviously, somebody market selling it, trying to create a liquidation flush out, at which point when they were done with their sell, it almost immediately snapped back. At least it's actually more than 50% of snapback. Now, this kind of stupid trading, if this was anybody doing real selling, then instead of using algorithms like CoinRoute's offers or Coinbase Prime offers or other people offer, then they're just, excuse my language, they're fucking morons. And they're just burning incinerating cash. So what's more likely is people try to manipulate or push the market and low liquidity around to see where those bottoms are. And I think that,

as I've said before, we're in a trading range. So I think that's what's really going on here. I mean, does the fact that we for five minutes ticked to fit under 55,000 while we were on this call matter when we're at 56,200 right now? I mean, if it's confirmed, if it goes down that level, yeah, maybe, but it's not. And so you have to be very careful in using that analysis. That's a point. I also want to go back to the token versus equity point and make one statement, which is interesting, that no one ever talks about. You kind of, you know, several people glossed around the edges. But the biggest difference between tokens and equities are there's a much, much, much larger investable universe for a token than for any individual equity. What do I mean by that? Well, first of all, even if they were fully listed outside of the U.S., it's hard to buy small cap U.S. companies. In the U.S., it's really hard, almost impossible to buy small cap

foreign companies. But tokens are all global from the jump. That's thing one. Thing two, VCs in the US consider IPOs their exit liquidity with enormous, and this is a lot of cost in doing an IPO here and in a lot of other countries, whereas tokens have exit liquidity from the jump, right? They're there, there's a global audience, they trade. That changes, That's why that due diligence is so much more for equities than it is for tokens, because the odds are much better, because there's a much larger demand pool, and you can't ignore that. Now, eventually, I agree with Zach, by the way. I don't think it happens quickly. Eventually, these rules will normalize, but we're a long way from that right now. Yeah, and I brought up, are are you there let me see if you're there

fefe there yeah maria everybody how are you man yeah i brought up first i didn't know you work with ryan so so uh good luck i'm sorry to hear uh but look man i had a question you posted about the the fear and green index as well and i kind of i i copied your image there and tagged you in it as well and you said how the the fear and greed index is currently at 28. Yesterday it was at 29. Last week was neutral. So that's fear. Today and yesterday was fear.

And I'm not sure if 28, 29 is like just on the edge. I don't know what the threshold is for the fear index. So I'm not sure if that's extreme fear or fear. But then neutral was last week at 53. And last month was greed at 72. But then I sat there thinking. I'm like, all right, cool. I don't read the news as much as most people here, so they're looking every day at what happened in the crypto world. But most of the news in the last month has been pretty good news.

Yet we're seeing that people are getting more and more fearful to a level that surprised me as well today. Can you give us your take on it? And what you said in the tweet, let me read out what you said. You said, this says it all. Can you explain what that means? What you mean by all? What's all? Yeah. Hey, Mario. And hey, everybody, thank you so much for bringing me on. I appreciate it. Yeah. So for me, honestly, I think if you look back to the 2021 bull market, and if you look back to 2017 as well, you've seen that these massive corrections are coming. If you see that the the the average correction in 2017 and 20 2017 was about 40 percent that we had in the bull market

and then you look back 2021 we had corrections 172 percent one thirty percent one forty three percent twenty eight percent and now this is the first time when we go below 20 22 percent really in this in this cycle um and so And so if you've been here, if you're not class 2023 or 2024, you know that these corrections are absolutely normal in crypto. And I think that going back to the technical analysis,

I actually have to agree, in and of itself, technical analysis probably doesn't work, but it's my belief that TA is actually short. So the charts actually show everything before the news comes out. A lot of times I say it on Twitter as well, is that you have market makers building up liquidity, market makers creating an environment for retail to believe something that is not necessarily true and therefore liquidate everybody. So we see that happening right now as well. If you look at the weekly chart, this is what I think everybody should really look at.

We can talk about Bitcoin and Ethereum and Solana and all these tokens, but everything is driven by the total market cap. So for me, my main focus for the past week or two was to look at the total market cap. And if you look at the total market cap, markets tend to come back to 50% retracement always. So if you look back 2017 happened 2021 happened

and also um we've seen that couple of times already since november 2022 which was basically the bottom of this of this of this whole uh of the bear and then the the beginning of the new bull um so so we we've got a retreat we got a massive push from november up to like april 2023 almost 100 and then we got our 50% retrace. And since then, all the news, the hype and everything around the ETF and crypto basically didn't give us any pullbacks on the weekly. We got one pullback, which was like 16%.

But generally, if you look at the weekly chart, we didn't really have any pullbacks. So this pullback to the 50% on the weekly, which is down to 1.85 trillion is absolutely healthy. And I think that everybody who's afraid now should really pay attention because this is where generational money is made. How low do you think we'll go? Are you in Rand's camp? Rand, I think, thinks that we're pretty much reached the bottom. I think we're pretty much reached the bottom.

So the 50% retrace is 1.85 trillion on the total market cap currently we're sitting at 2 trillion uh so i think we have a little bit more to go maybe four or five percent lower possibly and then and then that's it i think i think so yeah jonathan am i coming through okay it. All right. Just a comment on the technical analysis. I'm an old school ag commodity trader that got into the equity futures and crypto for a while. I work at StockTwits. I'm a crypto lead analyst there and the writer of the newsletter. If you ever spend time on the app, there's a lot of great technicians who do fantastic analysis. And it's really cool to watch these posts that some of them are CMTs, the Chartered Market Technicians Association.

Some of them are from the International Fellowship of Technical Analysts. They do phenomenal analysis. What's your stance on the markets now, Jonathan? What's yours and your team's stance? As far as the bottom, like 47 to 48K is a zone that looks attractive from technicals and that somebody had mentioned earlier that that you have institutional funds that are likely interested in into that 40 zone that's that's very likely but at the same time i mean if you look at how if you look at bitcoin's chart or the total market cap chart and the altcoin market charts, these deep retracements during an expansion phase are very normal.

It's not uncommon for Bitcoin to go down 40% or more during these longer expansion moves. This is par for the course. And I know that people on the retail side, they feel less comfortable than like a goat eating in a ghost pepper field. But for people who are long-term hodlers in institutions, they get as happy as a fat kid in a candy store and a buy one get 10 free day. So they look forward to these huge ass drops because it's always a lot of fun to watch our sentiment and message volume to see how that diverges and can become a leading indicator of some moves on not just stocks, but crypto. It's a very cool time to be in right now from a trading perspective. Yeah, that's what I got to say there.

Yeah, and I'm just looking at some of my portfolio companies, which I really just probably should start doing more. And even the high quality projects have dropped significantly. When I say high quality, I mean Binance. I looked at the Binance Launchpad projects we invested in this cycle, and we did a launch countdown for. And yeah, even for those, they've taken a big hit. Like Pixels is down about 75%, 80%. But then there's a few outliers. NotCoin, for example, is sitting pretty healthy, not too far from the all-time high, but definitely at a pretty high level, much higher than Launch.

So some of the coins are doing better than others. But my question to you, Jonathan, I saw your hand up as well, but my question to the panel, and Fefe, I'll go to you with that one as well because I know you covered that on Banter. Is there any narratives that are doing better in this cycle, in this correction, compared to others? Meme coins are definitely not it. Gaming is not it. Any other narratives that are doing well? I mean, I would say meme coins are performing very well. I mean, did perform very well.

So, like, obviously, if you look at all this stuff, all these narratives, they come and go. That's the whole nature of it. So if you look at MemeCoins, they've been basically driving the entire Bitcoin ecosystem with the whole ETF and MemeCoins. That was what we've really been, and some AI. That's what basically happened the past year. So the question really is what narratives are going to run. The reason why NotCoin didn't fall, actually, is because of all these tapping games that they are coming with the 900 million users. There is a project that we work with called Pixaverse.

They onboarded 50 million people from basically nothing within, I don't know, within, I don't know, months. So that's why. Whether the token is actually worth what it is, it's, I don't know, 40 billion valuation right now when the whole telegram as a company is 30 billion, valued at about 30 billion.

That's another discussion. But what narratives will run? I'm not the big narrative guy, but what I can tell you, what we hear when we discuss the banter is the following. I do think that meme coins are definitely here to stay, even though people bury them now. I do think that meme coins are going to be

very dominating in this cycle. I do think we're going to have a gaming and we're going to have a DeFi summer. So we're going to have not necessarily DeFi summer gaming and we're going to have a DeFi summer. So we're going to have, not necessarily a DeFi summer, but we're going to have a DeFi run. So we're going to look at, you know, staking and restaking,

liquid staking and all this kind of stuff. I do think that's going to come depending on obviously how the elections go as well and how the whole regulation will be settled in the States. But I do think that DeFi is going to be big. Yeah, just going back

to kind of a macro discussion, Dave, Jonathan, DB, Alex, and Dan as well, we'd love to get your thoughts on this. We've got six important events here. So Powell's going to be testifying on Tuesday, tomorrow. Then we've got an OPEX monthly report coming out on Wednesday, CPI on Thursday, PPI on Friday. And then the Michigan Consumer Sent sentiment data on Friday as well. So there's a lot of data coming in from a macro perspective. How big of an impact do you think it would have on the market, Stan?

Yeah, I think the CPI is going to be bigger than previous ones. I think looking at Fed rates, 70 plus percent chance of a rate cut in September. So that's high. I think it's going to be a big week, which I know that's a bit of a mean phrase, but I do think it's going to be a big week. I think we've bottomed for price. I don't think we're seeing 40s. I think we have bottomed.

I think from this week onwards, I think we're going to go back up. If you look at sentiment on Twitter, it can barely be much more kind of sour. People are saying it's never going to go up, there's never going to be another leg. I think that's where we are. I think this is going to be a big week, but then I thought that last week as well, I suppose. And do you think if we don't see a right cut this year,

your thoughts on what that would mean for the market? I think we will see a right cut. I think we'll see a right cut in September. I think before the election, I think we will. If we didn't see a rate cut, yeah, I think it would be more difficult. But I still don't see us trading much below kind of high 40s this year, really. I mean, my base case is I still think we're going to see above 100 this year. so i don't think we're seeing much below high 40s yeah alex i'd love your thoughts on this and a question for the panel right after is uh your does anyone on the panel doesn't think that we'll hit 100k this uh um before the end of the year actually before the end of the cycle not the end of the year but alex would love your thoughts on the macro discussion with dan yeah so i thought we were going to see a 20% to 30% retrenchment after the ETFs.

It took longer, certainly, but I think that's part of what we're seeing now. I don't know. I think we'll get some 5% or 10% price action after the CPI and PPI numbers, depending on what actually happens there. I don't know whether it goes up or down, but I think we basically sit in this 50,

mid-high 50s range for a while. Maybe it touches 50. I also doubt it goes down into the 40s. Maybe it touches 49 or something, but I don't think that. But I also don't think we're breaking back 70 again before September and the fall. So I'm expecting kind of doldrummy through the summer and then especially in the back. Alex, if I see the same cycle repeat itself, September is the month that we can finally for you see a bounce in the markets, correct? Is that is that what we saw? Was it was it September in

the previous two cycles? I think so. God, I'd have to go back and look. I don't know. Someone else probably knows better than I. It wouldn't necessarily be September, but it would be the number of months since the halving, right? Because the halvings have not always been

the same month. Yeah. Usually it's like six months, which would put it closer to like October. I think there's a little bit of a wild card there like with the US election and things there too, but that also usually aligns roughly around the u.s election and things there too but that also

usually i think roughly around the heavens as well if trump wins which i seriously think he is going to win i think we'll see a big rally off the back of a trump victory okay yeah i mean trump's definitely you know biden like well and again this is like the weird wild card stuff i mean biden just dropped another letter today making very clear he's not going to drop out but like i don't know man nixon was also really insistent he wasn't gonna resign or drop out or anything and for all we know you know that he's fucking 81 he could literally have a stroke tomorrow what's the has anyone i want to look at what polymarket uh puts the odds at him dropping out it's like above uh 50 on the weekend

when i checked it out i think it was 70 i think it was higher yeah oh wow yeah so it was around 70 yeah but that was i think no matter what happens there it's still not gonna like make a massive uh chain all right right now polymarket has biden dropping out at 50 oh wow dropped significantly i i don't think it gets or now up to 59 i don't know it's all over but but the point is I don't think any of that's going to make a 50% jump like I'm still pretty bullish on topping 100k this year um you know or maybe early next year at the latest on it but I don't think that like political moves or even just like straight inflation numbers are going to be the thing that doesn't like it is

still fundamentally narratives that do it and so there's gonna have to still be like the next narrative leg up for that to happen yeah db you've been quiet any any thoughts on this no i pretty much agree with uh most of the panel here it's it's the same thing we've been discussing for weeks what do you think what do you think we'll hit i don't think we've asked you that question what do you think we'll hit this year and then this by the end of this cycle the all-time high this year i'd say 100s doable i wouldn't be surprised to see it a little under that maybe but as for cycle top uh 120 to 140 maybe. Dave? I think that people need to understand what the 25th Amendment says.

So to understand why that this is all playing out in the media and you can say whatever the hell you want to say. But I think the most common thing that almost everybody agrees is that most people in the media and those who've been covering the administration have been covering up what they really thought because it's just completely, you know, it's inconsistent. But understand that with Nixon, they were able to walk into his office and say, we have enough votes to not just impeach you, but convict you in the Senate. And his administration was able to count those votes and see it. So he said, okay, fine. And he left. Great. With Biden, the way the 25th Amendment works, the VP has to, in writing, along with a majority of the cabinet, declare him non compos mentis. And then he can say he is in control of his faculties, in which case it takes a two-thirds vote in Congress to actually remove him unless he goes along with it. There's basically the only way they're going to get a two-thirds vote is to force people to go on record. And it makes it very, very interesting.

So this is I think that what you're seeing is reality TV and or a game of chicken. And why should we care? Well, we do care because it really depends. Nobody knows who would succeed him. Or no one even knows. I remember Caitlin Long put out a tweet saying, what's Kamala Harris's position on Bitcoin and crypto? That matters. And so who knows what will happen?

It's pretty early and that creates volatility and that creates uncertainty guys i just looked up that's what we care about dan i'd love you to respond to dave but i just looked at a project 30 uh sorry 539 um and they do simulation on who's uh you know they're pretty objective and who's gonna win the 2024 presidential election trump only wins 51 times out of 100, Biden at 41 times out of 100. So it seems pretty even then based on the simulation. Does that mean like we're living – I know, like you're putting the laughing emojis, guys. I'm in that camp as well.

Like I just find it so unlikely. But I'm like, hold on. Am I living in that Twitter echo chamber which makes it seem know there's no way biden's gonna even continue running and there's definitely going to be swapped my position is that they'll probably swap him um but then when you look at the poll numbers you look at 539 538 sorry um it's it just paints a different picture and that's updated today latest update based on a thousand simulations yeah so a couple things um i think look when it was the 2016, Hillary was like 99% confident going, right? The Economist or the Times or whatever ran out with a front cover saying Madam President or that kind of stuff. I think you have what's called in the UK the shy Tory vote. People don't want to admit that they're voting for the Tory. I think it's changed. Sorry, Dan, to talk about it. I think it's changed now. People are shy to say they're going to vote for Biden now. I've had people discreetly tell me like i'm voting for biden but like i can't share that publicly i think there's still more stigma publicly coming

out and saying you're voting for trump but that is also less you saw the winklevi twins come out and say that they're voting for him and backing him um so possibly but the one the funny point that i wanted to make in response to dave was in the 25th amendment if the most hilarious path would be if they invoke that then it goes to congress and the republicans don't give them the two-thirds of the vote they need to uh to get him out of office because you know it would need the republicans to give them the two-thirds to get him out and they could say no we're not going to do that because we want him to stay in place because we know we can beat him in the election that was exactly my point i kind of didn't want to go there but yeah you know look i think that's why I said it's reality TV.

And I think that the reason the simulations are showing what they're showing, Mario, is there's uncertainty. Markets hate uncertainty. Now, that said, in particular because of the themes that we keep talking about. So, you know, look, there's a long way to go here. And, you know, so anybody who says we know how things are going to go, we understand it's the only thing that will create a very firm trend sooner than the fall would be if Biden does decide to drop out in favor of a candidate and running mate who declare and start making substantive changes that are pro-crypto. And which I don't think would be likely, although a lot of people would try to judge in that direction. Basically, the repudiation of Elizabeth Warren is the single most important thing that

matters. Because if you had both administrations repudiating her, yeah, you would see a very strong bull market. Yeah, yeah i do want to go let me go to alex very briefly and then we'll go to antony and and matthew i don't i don't love normally making hard predictions but i i will i will adamantly declare a few things number one unless something drastic happens again like a massive stroke or something the 25th amendment is not getting invoked. Um, look, we do lit, especially everyone on this is probably in the Twitter echo chamber. Biden's an 81 year old dude. He has a lot of bad days. He's probably, you know, he's an 81 year old with like mild dementia. So like the more tired he is, the worse he does, but he stole perfectly competent, a fair chunk of the day. The Democrats are not going to go in and invoke the 25th Amendment on him. They're just not going to.

Number two, even if they did, that's only about the presidency. It actually doesn't affect his candidacy at all. He'd still have to voluntarily drop out of the race. So, again, it would just only be a mess for them. There's no upside. I still think there's a chance he does end up voluntarily stepping down but do you think that's above above above 50 above 50 chance i think it really depends on what happens over the next few weeks especially around donors and things i mean the interesting thing is uh bloomberg and morning comes still ran a poll like last basically late last week i think it was monday through friday basically

and the results just dropped on sunday um and this is part of the reason that i think the 538 numbers moved a little bit that show him like gaining ground and actually being ahead in some of the key battlegrounds especially like michigan and wisconsin um and that'll that'll bring me to kind of like the final thing i'll say is and we saw in 16, we saw this to a lesser degree in 20. One of the huge damn downsides to our two-party system here is, and the combination of that with the electoral college is, that the entire election ends up getting decided by 25,000 voters each in six states in a two man race where we have the two most unpopular people ever running for president, or at least the two most unpopular since 2016. So anyone who says they know what's going to happen, or there's no way for this person to

do something. No, man, weird weird drastic shit happens hillary would have won in 2016 if not for comey coming back out and announcing opening back up like there's been plenty of data analysis showing that that because again that just swung a few tens of thousands of votes in a few states so we're gonna be in for uncertainty we're gonna be in for a wild ride for the next few months and like things will go up things will go down weird shit's going to happen but nobody knows exactly how it's going to play out even if we're like confident it's probably this and that's why actually i think those projection style things of running a bunch of different simulations are a lot more accurate than just like say straight polling

now i appreciate that look guys i think we've moved into a political discussion. Good time to segue back to crypto with Matthew and Antony. Guys, thank you for partnering with the show. Good to have you both. I think it's the first time you both joined the panel. I'm going to kick it off with the questions immediately. So Aleph0, before asking you the question that probably everyone asks you is, why do we need another L1?

First, tell us more about what LF0 is. Yeah, thanks, Mario. I'll jump in on this one. Happy to be here. Thank you all for tuning in. LF0 started as an L1 back in 2018 and our goal was basically twofold meaning to build a blockchain infrastructure blockchain network that solves all three of the most pressing concerns of the industry so namely you know performance scalability decentralization so we wanted to kind of find the optimal mix of sacrifices in each of those areas

so that you end up with a network that is highly usable scalable fast and so on i would say that you know fast forward to 2024 performance for the most part as far as the speed of the transactions, time to finality and so on. This largely has been solved. And also the L1 has a sufficient, I would say, level of decentralization with over 160 validator nodes. Now, to sum it up, why we've created LFZero was to solve pretty much two of the main challenges that we think are the most or will be the most useful for builders, which is performance and privacy. And now, with the performance aspect being more or less solved, it's time to tackle privacy. We've been working on this for the last two, three years. And in particular, we're focusing on ZK-based and MPC-based privacy challenges.

We've just recently announced an EVM-compatible L2 where our privacy stack that we're calling ZKOS is going to debut this year on the mainnet. And this is something that we're very much looking forward towards because the idea is to combine sort of the on-chain privacy that is easy to use, relatively easy to work with, because it is a complex tech so making it easy to implement, easy to build with. This is the most challenging part.

And then ultimately easy from the UX standpoint for the end users. So that's pretty much where we're at let me let me ask you a few questions because i think you've just given give me a lot of information so first you've been building since 2018 that's correct yes okay and you've listed in 2022 correct uh 2022 yes that's right mainnet launched early in the second half of 2021 nice and the token went went live in yeah in january of 2020 november well november 2021 exchanges on the centralized exchanges it came on later so you have okay you didn't you didn't list directly on on centralized exchanges matthew yeah we i mean it would the network went live in november of. And then a couple of months later, we were listed on exchanges.

Oh, nice. Okay, cool. And you're sitting at $130 million market cap with pretty healthy volume. And the price has been relatively steady. Not sure what you listed at, but you're sitting at about that same range, which is pretty good considering market conditions. Let me go back to the privacy aspect. And I want to kind of talk about your ideal user, who you're targeting to start off. But first, we've had multiple privacy-focused L1s on this space and on other spaces.

What makes you guys different? What is your edge over others? Well, one of the things that we do is we've developed some of these pre-compiler notions. So it's really a lot of optimization. So what you have is whenever you're doing these zero-knowledge proofs, it requires a lot of computational time to generate the proof. Normally, this can go from anywhere from one minute to two minutes, and that's just to say if I want to do a private transfer. And what we were able to do is optimize this and reduce that town to be sub-second.

So you can actually generate a proof in a browser and on your phone in such a short amount of time that just is way better than what was previously available on the market. Yeah, but I feel like privacy-focused, ZK privacy projects haven't really gotten the attention that I think they deserve. Is this a problem that you think the market is not paying attention to? I think it's a problem the market has largely overlooked because the user experience is really poor. So whenever you have much longer times to be able to use these types of products, then people's attention span just drop. They don't want to use it. They're just, you know,

they're like, okay, well, Bitcoin or any of these other ones, I have pseudonymous transfers, that's good enough for my purposes. But they're not thinking about long term. What are the actual privacy implications whenever it comes to having a fully transparent public chain where everybody can see this? So, you know, it's that I don't know if you recall the XKCD comic where they, you know, they have that $5 wrench attack. Well, if people know what your wallet is, you're susceptible to potentially different types of attacks and scams. Yeah, sorry to get interrupted. I just chewed out for literally 30 seconds.

One of my friends, pretty influential people on Twitter, just got swatted. And apparently a lot of influential people are getting swatted just seeing it all over Twitter. We could do space on it earlier. So it just popped up on my notifications with my personal number. So I apologize, Matthew. Just going back to the discussion, I heard your response.

But do you think regulation could kind of play a positive role with MECA and other regulations that are upcoming? Could that change the sentiment when it comes? Because in the centralized world, with GDPR and other regulation kicking in, companies are starting to focus heavily on privacy. Apple being obviously the most obvious example. But in crypto, that hasn't happened yet. Do you expect regulation to kind of maybe kick off um that that momentum in crypto in web3 to to an extent i do think that you're seeing a lot more of that interest from the enterprise side for these types of privacy applications so you know and on a lot of in a lot of um in the sort of the the broader sense what's really going to be

happening at least my my thoughts on this, is that you'll actually have the adoption coming in from the corporates for privacy applications, and then they're going to basically be advocates for the industry to push for sane regulations on the privacy side. Yeah, just going through. Yeah, I would say that, Mario,

I'll just maybe add one thing. So you've got two main challenges here. First one is the UX. If you look at the overall Web 2.0 world, privacy is largely abstracted away from the users, right? It's just there, it's sitting there, it's protecting you in the background. In Web 3.0, this is not so obvious,

and you do have to suffer through um a complex ux in order to get your um to make your assets private to execute shielded transfers and and so on and the second is is the regulatory aspect because there is this i would say semi-misconception that regulators are against privacy and that couldn't be further from the truth they're very much pro-privacy the main thing that they are against is essentially money laundering in the in the association with um various privacy use cases when you when you guys raise money in in in the midst of the bear market um who are any notable investors you can mention but more importantly what were those discussions like when it comes to investors?

Was it like, hey, we understand the need for privacy. Why are you the best? Or did you have to pitch to investors why privacy is important? My guess is the former. Investors in the space obviously know the importance of privacy when it comes to utilizing the blockchain? Well, I mean, actually, I want to say privacy was a major part of the discussion at that time. I mean, this would have been in early 2021, early 20, you know, late 2020, early 2021. Yes, it was a part of it. But it was really at least with the original private sale and such the messaging was more on the performance side.

Of course, we have a team of photographers that have been working on the privacy side, you know, since that time as well. But that was more of a, you know, it was more of a, we wanted to improve various aspects in the space, right? And privacy being one of them. But at the, you know, when we were talking to investors, you know, whatever, how many years ago was that, Anthonyony it was four years ago um it wasn't really a major uh talking point yeah uh and let me go to to some of the products that you have you guys um have obviously i know

about common that we looked at probably previous to the show but any any other interesting unique cases that you have use cases that have been built on lf0 and you can obviously talk about common as well yeah i would say that definitely idos is one of the interesting ones this is a essentially an interoperable multi-chain identity framework and we're working together with the idea was team to enable zero knowledge ID so essentially you're going to be able to prove that you're you know over 18 without revealing your your actual age to prove your funds provenance without disclosing all the details and and various use cases like that there is is, for instance, Darkverse,

DRKVRS, which is an RPG game built by folks who have pretty solid experience in gaming and CGI and overall animation. And we're going to be working on implementing privacy components into the Darkverse world. You know, it's a dark environment that is very, very mysterious, very engaging. Can you explain, how would privacy look like in a Web3 game? Like, what would you want to keep private in the game?

For instance, if you have several locations that you don't want the public to know that you're going to within the game, as an example. If you have certain gamification. That's interesting. Going to an in-game strip club. Yeah, go ahead, sorry. I mean, it can be whatever really that the creator wants to do. It could be for strategic reasons as well, from a gaming perspective. Bingo.

Could be for pretty much that. Could be for any reason that you might think of that is sort of embedded in the game. That's actually very... Sorry to interrupt, but that's actually a very interesting use case. Very interesting use case. If you think of it from a gaming perspective,

the whole strategy concept of a game, everything is decentralized goes away if you don't have privacy built into it so i think privacy within web 3 games is paramount for the for those games to be able to any and also mario you have to be careful whenever you're playing the game like you like you were saying it's it's a sort of strategy mechanism where you don't necessarily want to reveal what parts of the game you've played, what parts of the game that you've done to have succeeded because, you know, that removes from the gameplay. That removes from the experience as well. So if that's all public on chain, then that just, you know, destroys the entire fun of the, you know, and the entire purpose. Yeah. Let me ask you another, another question. Like what is mentioned something that would just excite the average, um, not investment advice, but the average investor or the average,

um, I'm just going to use the word investor. Cause no one else that would care about this question is that what are some of the partners? You're like, why should people pay attention to LF zero with the, all the other privacy L ones out there. And you've talked about the technological benefits that you guys have, which is for many people is difficult to comprehend but um um beyond that is there anything else that would be like hey we've got a partnership with xyz that will grab attention yeah i'm i would say that you know we're um we've established relationships and partnerships with two telecommunications companies so far. Deutsche Telekom, which together with T-Mobile, which is the US branch of Deutsche Telekom. This is the largest telco company globally, I think.

Then we have STC Bahrain, so Saudi Telecom Bahrain. And for now, these two are validating the network. So this was the first case where such a large enterprise as Deutsche Telekom or STC began validating privacy-enhanced blockchain infrastructures. And then we do see a ton of potential in bringing enterprises on chain also with those privacy aspects. Because in the past, we've seen that you have permission deployments on, say, Hyperledger or Corda. But then again, if you're building a permissioned use case in a closed network that you control, then why, you know, honestly, why not just use a database instead of a blockchain?

So this is something that we're going to be addressing. And there's going to be something cool to announce pretty soon, I believe, with regards to having use cases that make sense, that bring larger firms on-chain while keeping the data and their on-chain movements private. And Matt, last question to you is any other interesting develops that you have coming up? Any recent milestones worth mentioning? I'm also curious to know what your cap table looks like,

if that's something you could share well i mean as far as uh recent developments with the this uh the layer two that we're putting out that's going to be evm based i think that that's that's just nice because i mean it's it's a significant improvement um in that it'll allow more developers to deploy whatever applications that they want i mean in a lot of, we're very laissez-faire and let the market decide what applications people want. And, you know, most of the applications that we've seen are mainly financial. And there's plenty of really good reasons to have privacy in financial applications. I think this is something that has been core to a lot of the principles around the world, especially in the States.

You saw the pushback with the IRS's request to get $600 of transactions from Venmo, collecting all that data and that information. And there was a huge pushback from the general population on that just because they're like, well, why do you need this info? So I think overall, we are seeing a broader need for privacy solutions. And then as far as the cap table, I mean, this has been trading for four years. I mean, so like things have changed hands as far as who was on board. We have, I mean, this was, you know, it's out on our website. You can see some of our

our initial investors um but obviously this is there's there's just way more that's happened since then and and you know maybe people have bought in you know that we don't know about yeah i appreciate it on that point i appreciate everyone joining um aleph zero if you want to check him out the handle is in in the – it's wrong. Let me fix the handle in the – it's two underscores. So I'll fix that in the title now. Let me do that. Done.

All right. The handle is in the title, but you can see Antony and Matthew are on the panel as well. You can check them out. Otherwise, we'll see you again tomorrow at the same time as always. Appreciate everybody, and hopefully the market will be relatively steady so we can focus on the news rather than on why the market is back, is back, is up or back down. I appreciate everyone for joining. We'll see you again tomorrow. Thanks, everyone.