Unchained - Arthur Hayes on Why Tariffs Will Be Good for Bitcoin and Crypto - Ep. 813

Episode Date: April 8, 2025

TradFi and DeFi markets are in motion, responding to Trump’s tariffs, but a giant injection of liquidity could be on the way. Maelstrom CIO Arthur Hayes provides his expertise on economic policy, macro movements, and political implications, delving into a variety of topics, including: Trump’s rationale for tariffs The possibility of a “fiat liquidity bonanza” and what it means for crypto What the Hyperliquid brouhaha reveals about decentralization dreams How Ethena might be an attack on Ethereum The value prop of Circle’s IPO Future price expectations for BTC, ETH, and SOL Visit our website for breaking news, analysis, op-eds, articles to learn about crypto, and much more: unchainedcrypto.com Thank you to our sponsors! Bitwise HRF Guest: Arthur Hayes, CIO of Maelstrom Previous appearances on Unchained: How Arthur Hayes Has Prepared His Portfolio for the Elections Links Previous coverage on Unchained: Trump Tariffs Sink Crypto, BlackRock Pumps Bitcoin’s Bags Why Trump-Induced Stagflation Could Finally Make Bitcoin a Safe Haven Tariffs, Hyperliquid, and $1 million Bitcoin Arthur Hayes on X: Tariffs = money printer goes brrrr Arthur Hayes on X: Is Trump trying to trigger a mini financial crisis? Arthur Hayes on X: CZ and Star ‘gang up’ on HyperLiquid Kevin Zhou on X: Binance and OKX listing $JELLY sets a precedent DL News: Arthur Hayes on the one reason that tariffs can’t stop Bitcoin’s surge Trump pardon: CFTC.gov: Federal Court Orders BitMEX’s Three Co-Founders to Pay a Total of $30 Million for Illegally Operating a Cryptocurrency Derivatives Trading Platform and Anti-Money Laundering Violations | CFTC (May 2022) Justice.gov: Southern District of New York | Global Cryptocurrency Exchange BitMEX Fined $100 Million For Violating Bank Secrecy Act | United States Department of Justice (Jan 2025)  CNBC: Politics Trump pardons three BitMEX crypto exchange co-founders, and ex-employee  Timestamps: 👋0:00 Intro 😰 4:07 Does Trump’s tariff rationale make sense? 💲 10:49 The upcoming “fiat liquidity bonanza” and what it means for crypto 🫤 20:18 What’s wrong with a Bitcoin Strategic Reserve? 💥 24:20 The Hyperliquid brouhaha and the decentralization pipe dream 💪 32:04 Why Binance and OKX “fatal blow” on Hyperliquid didn’t work ⚖️ 37:57 Trump’s pardon of Hayes and his visit to Mar-a-Lago 👀 46:27 How Ethena’s Converge chain affects Ethereum 🤼‍♀️ 52:58 SOL vs ETH: Which is a better buy right now? 😬 57:12 Hayes’ opinion of USDC’s Circle filing for an IPO 🤔 1:00:18 How does Hayes suss out potential investments? 📈 1:03:11 Price predictions on BTC, ETH and SOL Learn more about your ad choices. Visit megaphone.fm/adchoices

Money is being printed. It will be printed. Powell told you it's going to be printed at the last press conference. He says tariffs are transitory. I know Bitcoin has done pretty poorly alongside the NASDAQ and the S&P and a lot of other global stock indices. But I think that's just investors not really appreciating that this is a fiat liquidity bonanza that's about to happen. I think Bitcoin will decouple from these stock indices and trade alongside gold and really reflate higher as, the money supply globally goes higher. Hi, everyone.

Welcome to Unchained, your no hype resource for all things crypto. I'm your host, Laura Shin. We are now featuring quotes from listeners on this show. Today, we have one from Elamia on X, responding to my interview with Dragonfly partner Omar Conchie about Circles IPO filing. Elamia writes, quote, $5 billion evaluation and regulation risks, this will be an interesting ride. If you'd like your comment featured,

write a review of the podcast overall or leave a comment on our video on YouTube or X. This is the April 8th, 2025 episode of Unchained. Big news. Unchained just launched a brand new newsletter, Bits and Bips. Just like this podcast, it's all about how crypto and macro collide, one basis point at a time. Get expert analysis, market insights,

and the biggest stories shaping both worlds, straight to your inbox. Subscribe now for free at Bits and Bips.Behive. That's bits and bibs.bips.bohy.com. Find the link in the show notes. In many countries, governments freeze accounts, surveil transactions, and seize assets, not just from activists, but from everyday people. That's why the Human Rights Foundation created the Financial Freedom Report. Sign up to receive it weekly at financial freedom report.org. Crypto moves fast. It's why Bitwise launched the weekly CIO memo, a jargon-free

summary of what's moving crypto markets, written by one of the best in the business, CIO Matt Hogan. Get up to speed in five minutes or less. Check it out at bitwiseinvestments.com slash CIO memo. Carefully consider the extreme risks associated with crypto before investing. Today's guest is Arthur Hayes, CIO of Maelstrom. Welcome, Arthur. Hi. We're recording on Thursday, April 3rd, the day after Trump announced his Liberation Day tariffs, These ended up being 10% as a baseline on all imports. And then certain countries that the White House considers that actors have higher rates.

So, for instance, duties on Japan are 24% on the EU, 20%. China will have a tariff of 54%. Candid in Mexico will likely have something around 25%. I have seen such a wide range of assessments on this on my timeline. There's the pro-tariff side pointing to the fact that now the yield, on the 10-year treasury is down to just a bit over 4%. On an inauguration day, they were at like about 4.6%. The critics are saying this is wrecking the economy.

They're not even, the calculations aren't even based on like existing actual tariffs, which is trade imbalances. Like people are laughing at how they've calculated this. Others are saying manufacturing is just not really kind of come back here to the U.S. on the timeline that Trump would want. And it's also even not like feasible necessarily for a lot of us. items. And I saw one other interesting take, which was that Trump's tariffs do not take into account the digital goods that are being imported and exported. I was wondering for your take,

what do you think? Are tariffs good, bad, you know, overall? And why do you think that? And then who do you think will be the winners and losers in this tariff war? So I first try to remove any sort of moralistic judgment on any sort of economic policy and just adapt and try to make money. I think when you get this, is it good or is it bad? For whom? It's all relative. So instead of getting all worked up about it, just try to figure out what's going on and adjust your portfolio accordingly. So I think it's quite simple. Trump in 2016 and Trump in 2024 made the same pretty much promise, which was in his worldview,

the United States is getting ripped off by the rest of the world because there's this massive current account deficit, mostly in tradable goods that the United States is running. and they're opening up their markets and allowing people to dump their cheap goods. And so he believes that it's his job to reverse that chart. And I posted a chart in my recent essay, the BBC, and it has the current account balance, which is a good proxy for tradable goods balance, and the reciprocal of that, which is the financial account. And I'll get to that in a minute.

So if Trump really wants to get this chart to go from, I think it's minus a few trillion dollars, whatever it is per year to zero, or credibly show the American voting public that he is making good on his campaign promise and this chart is zooming back towards zero. Then what he is just done is exactly what he should do in terms of how he would go about rectifying this imbalance. Taking the trade deficit, saying, okay, I'm going to, I forgot the exact formula. Divide by some number. I gave you a discount. And there's this massive number, right? Obviously, China has one of the biggest because, of course, China runs the largest export surplus globally and has done pretty much since they joined the WTO in 2001. So that's the goal. If you're going to

try to reverse these imbalances, this is exactly what you should do. However, on the other side, for all the dollars that people in the world, China, Germany, Japan, earn because they want to keep their currencies undervalued, they don't take those dollars, convert them back to yuan, for example, and then do stuff internally, they take those dollars and they buy things in the United States financial markets, notably U.S. treasuries and U.S. stocks. And so the foreigners who have earned all these earnings selling things to America take those earnings and finance the U.S. government and finance American tech and stock exceptionalism, which is why the U.S. markets have outperformed massively the rest of the world over the past 20 or 30 years. And the Treasury

yield, even at four or something percent, is marginally lower. than it was about 30 years ago, even though the total stock of debt is up over 7x. So this is the trade. He's trying to reverse these things. The good things he's telling the American people, I'm going to bring you back really good jobs, especially for people who don't have a university degree. However, given that, the United States government is finance externally, and it's foreigners who are, you know, levitating the stock market, keeping yields low.

The converse of a shrinking current account balance is a shrinking financial account balance and the Chinese, the Japanese, the Germans, everyone else around the world will not be buying stocks and treasuries because they don't have the earnings from the dollars from importing things into exporting things to the United States. So again, I think it's quite simple. It makes a lot of sense what he did. Whether or not you think it's good or bad is kind of irrelevant. So that's sort of my take on Liberation Day, if you want to call it that. Well, you know, I'm curious about the way you kind of sidest up the question because you're clearly so knowledge of. about macro and just generally like, you know, how all these things works. And I am surprised that

you don't necessarily have an opinion on at least let's just speak for the U.S. We're both Americans. I know you don't live here anymore. But as an American, like, do you, like, if you were president, do you think that what he's, his goal here is a good goal? It depends on who you want to get elected by, right? So Trump's voter base and I'm very, I'm using averages and maybe you can push back on if you see some different statistics, The statistic that I saw was that approximately 50-ish or a little bit more than 50% of people who made over $100,000 an exit polls, on average, voted for Kamala Harris. So we can make a bold statement. Rich people voted for the Democrats.

And poor people voted for Trump, right? So what is the big delineation between rich and poor in the United States? Obviously, a university to degree. What type of things do you do with a university to degree? knowledge work, you know, you work with your mind, you're in tech, you're in financial services, you're an accountant, you're a lawyer, or, you know, those sort of things. What do you do without a college degree? You do some sort of manual type of labor or you used to, right? You worked in a factory, you made cars, those sorts of things, right? So what types of jobs have done very well over the

last 30, 40 years, and what type of jobs have done very poorly? Those are college degrees, those who hold the financial assets have done very well over the last, you know, the globalization, right? you bring in a billion workers who work really, really cheap in China, you depress wages in the United States, corporate institutions say, oh, well, I have an expensive American worker or a cheap Chinese one, I move my factory to China, my profit margin goes up, and then I do a stock buyback, I give all my money back to the shareholders, right? And so then people with stocks have done very, very well. People who have don't own stocks, who don't have a university degree, who used to work in a factory, have not done very, very well over the last 40 years.

So the Democrats, I'm making very blatant generalizations here, campaign on, hey, rich, educated person, progressive, whatever, I'm your person, elect me, right? And so Bill Clinton was a Democrat. He was a one who let shine into the WTO and essentially tariff-free access to America in 2001. Donald Trump said, oh, there's this massive part of America that's left behind. I'm going to campaign for them. I'm going to bring back manufacturing jobs, the good job, the job that lets you, you know, have a family, blah, blah, blah, middle class lifestyle, all that, all that sort of jazz, right? So you have these two opposing worldviews, again, and making very big generalizations and averages here. And so that makes sense of what Trump's policy is. Okay, if that's the person who voted for him and carried him to the White House in 2016,

in 2024, this policy is what they need. If you're a Democrat who gets Lars campaign donations and essentially is wealthier people who are voting for you, who own stocks, who work in sort of a corporate environment, a white-collar job, then, you know, the status quo works for you. And so really it's just a question of which side wins and which side is more effusive in their demands to change or keep the status quo. And so that's sort of how, that's the lens that I look at it. There's no such thing as bad or good for whom, right?

So I try to move this, oh, it's good or bad for America. America's a big place. You know, 400 million people. There's different views on the other end of the spectrum and each end of the spectrum. Yeah, that's true. That's true. And I know that generally when it comes to crypto, the main thing that you look at is the money supply. And you said prior to Liberation Day that you didn't think that high tariffs would cause

federal reserve chair J-PAL to pull back on quantitative. of easing. Correct. You know, generally, Trump and Powell have had kind of a rocky relationship. So I wondered, you know, what you thought now that it's happened and then, you know, what the knock on effect would be for crypto. So in a recent essay that I published called the BBC, I essentially talked a lot about fiscal dominance and I gave a funny little satirical interplay between Besson and Powell.

But essentially the point was... And the graphic was hilarious, too. The point is, as the Fed of Reserve Chairman, yes, supposedly you're this, you know, steward of the American dollar, keep inflation low, unemployment low, those sorts of things. But in reality, you're another arm of the government. And the government needs to get funded at an affordable price. And therefore, you will do what is needed as the Federal Reserve Chairman to make sure that happens. And I pointed out a very seminal speech by a former Fed chairing person, Arthur Burns, from 1979. Then they gave in Yugoslavia called the Anguish of Central Bank.

banking. And if you read that speech and you think about the issues that people are concerned about today within America and the world economy, you'd say, wow, it looks kind of like the same thing. And this point essentially was that the politicians and the government and the populace have adopted this stance that the government can solve all your problems. The only way government solves problems is spending money. And therefore, you embed an inflationary impulse into the bedrock of democratic society like America. And therefore, as a Federal Reserve chairman, while you might believe that you should be squelching inflation or tightening the monetarious conditions sufficiently to eradicate inflation, what you really need to do is make sure that the people get the policies that they voted for, which is inflation, essentially,

if you want the government to have all these sorts of programs. Back in the 70s, it was New Deal era, Grand Society type things. Today, it's woke inclusion, DEI, all those sorts of stuff, right? Same thing, different nomenclature. And so Arthur Burns was saying, yes, I was a Fed sure person at any point I could have stopped inflation, but I couldn't because my job really was to make sure that the government was funded. Now, Paul is in the same sort of situation here, right? What he should be doing is tightening monetary supply.

The U.S. economy is growing very well. Stocks are, I mean, stocks are down 10%, 15%, whatever, but they're at all-time highs, record wealth for those who own financial assets. Unemployment is at 4-something percent, record all-time lows. Why is he reducing the pace of quantitative tightening? Why did he cut rates in September and December of last year? He didn't need to. The U.S. economy is perfectly fine.

Real GDP growth is growing above trend. But he did it because there's a $36 trillion pile of debt that's growing exponentially. The interest costs in that debt is growing exponentially. And the main inelastic buyers, China, Japan, Germany, these exporters that Trump has basically said, take your things and go home or build your factory in America. therefore you don't earn any more dollars, therefore you can't buy any more treasuries, then if they're not buying, then the Fed or the banks have to buy. And so Powell, you know, he set his piece.

He tried to be the whole Volker or, you know, the modern day equivalent. But in reality, he's just another government hack and he needs to print the money. And he basically said that at his last press conference, I'm reducing QT. Why reducing QT economy is fine. I might do QE for treasuries, let the mortgage-backed securities run off, take the proceeds, buy treasuries. and then he stated that when I asked, my base case is tariff's inflationary impact is transitory. The fact that he even used that word is hilarious.

He got so torched the last time he used that in 2022 when inflation spiked in a transitory manager to the 40-year highs. However, that just tells you that his bias is easing. His bias is let's provide money to the treasury market so that Besson and Trump, whoever is in charge, can do the policy that they want to do. And I know people think that Trump is trying to sort of do austerity, but his plan is from a 7% deficit to a 3% deficit. His plan is not to go to a surplus. His plan is not to, on a net basis, retire treasury debt.

He's going to inflate it away by growing nominal GDP growth faster than the rate at the deficit. Yes. However, this is not a Argentinian-style Javier Miele. I'm going to have GDP crash by 4 or 5% because I'm removing this credit from the system. So I think, again, money is being printed. It will be printed. Powell told you that it's going to be printed at the last press conference. He says tariffs are transitory.

I know Bitcoin has done pretty poorly alongside the NASDAQ and the S&P and a lot of other global stock indices. But I think that's just investors not really appreciating that this is a Fiat liquidity bonanza that's about to happen. I think Bitcoin will decouple from these stock indices and trade alongside gold and really reflate higher as the money supply globally goes higher. Yeah, so I did also see in that same newsletter you said, if I had to place a bet on whether I thought Bitcoin would hit 76,500 or 110,000 first, I would bet on the latter. So how are you coming up with these numbers? And I know you wrote that before Liberation Day. So do you still hold that opinion. Yes, it's to hold that opinion. So 76,500, that's the low that we reached in

in March. The local low after we broke through 70,000 in November of last year, 100 to 10,000. That's the new all-time high that we reached on January 20th, right as Trump was being inaugurated. And so I think that we take out that next all-time high and Bitcoin continues to do very, very well. The stock market, who knows, right? I'm not a, I don't really do stonks. It's hard. Company earnings, evaluations, and all that kind of shit, right? All I focus on is global liquidity. I know that Bitcoin performs very, very well in a deflationary bust, which is what could

happen in this situation, and that the monetary authorities, the United States and the rest of the world will provide financial accommodation to make sure the governments get funded. So I saw that on polymarket, well, actually, this was yesterday when I wrote this question, but at that time, polymarket traders were saying that they saw a, a 49% chance of a recession in the U.S. in 2025. And I wondered what you thought of that. And if we do end up in a recession, what do you think would be like the likely cause or causes?

I mean, it could be much government workers are fired. There's a knock on effect of spending. Maybe Elon's doge cuts a bunch of waste or fraud or government programs. Maybe this tariffing causes a lot of companies to retrench. I don't know. I don't really think because all I care about is. global liquidity, a recession in my mind is just another way for, you know, Powell and his cohorts, people at other central banks, to basically stand up on the podium and say, oh,

recession, therefore I must print money. So great. If everyone thinks there's going to be a recession, regardless of whether it happens or not, it's just another excuse for a central banker to get up on the podium and say, oh, the economy is weak, therefore I must print money because that is the Kinsian economic theory that I subscribe to. But do you think it is likely or what odds would you give it? I don't know. I have no fucking idea. That doesn't matter. Okay. Well, actually, so circling back to the reason that Trump wants to do the tariff or, you know, is doing the tariffs, do you think he actually can bring manufacturing back to the U.S.? Possibly? I don't think it's going to happen on a timeline that's electorally feasible, which is why I believe that he has to go

hard and fast, basically by now. And things have to look better going into the end of the year because, you know, obviously he doesn't have to get reelected. But those who support him all have political career that they want to continue after 2008 or 2006. And therefore, the Republicans need to see some green shoots. I said it was going to get China to build manufacturing. We punish China. And guess what? You know, Alibaba is building a big fucking factor. in Ohio, right? And he's going to point here and there. And yes, I'm sure an aggregate, maybe the little tick up is a little dot on the chart. But in the media, he's going to play it up and he's going to point to all these different companies who've contractedly

basically said they're going to build something. It won't be built in the next 12 months. So you're not probably in the next 24, 48 months. But he just is going to point to, yes, I had a press conference with so-and-so major global CEO. And they said they're building a factory here. And she said she's building a factory there, right? And that's what he's going to want to show the American public as to this is why there is this pain in the stock market in the first half of the year. This is why it's going to get better going forward. And this is why you should vote for XYZ person in this congressional or senatorial district. Yeah. I mean, for sure, the timeline thing is a big question. But I'm sure you saw he

has been floating the notion that he might try to go for a third term. So I don't believe that. Yeah, I would like to not believe that. So hopefully, hopefully that won't happen. Let's actually switch back to Bitcoin. I know you're not a fan of the strategic Bitcoin Reserve. Why not? So I think anytime a government holds something, they can sell it. So everyone always freaks out about XYZ government holds so much Bitcoin. Are they going to sell it? They're not going to sell. They're going to market order, dump it. How are they going to do these things? So if people support governments globally, massing these stockpiles of Bitcoin when the politics change and the politics always change. It's a, can't really predict these things. Then from euphoria, we're going to switch to fear of what's going to happen. When are they going to dump these things? So why, if we know this is going to happen, why are we advocating for this policy? And then I think the second thing is, is not that I don't think I don't like it. It's more, I think people are unrealistic. What people think in their minds is, oh, the government's going to issue some bonds, prints of money, and then

they're going to go and they're going to buy crypto and put it on their balance sheet. Because most of the major governments in the world are deficit countries or the largest ones in the United States that people are always looking at. It's a deficit country. They have to print something to buy Bitcoin. It's not like they have a bunch of savings that they're going to buy Bitcoin. But even still, even if you have a bunch of savings, there's lots of people in your country that are probably poor or there's some societal problem that you could be fixing.

And what you're saying is, no, no, no, we're not going to do that. we're going to buy some Bitcoin and some crypto. Now, of course, I love Bitcoin. I love crypto, but I also see the political optics of that being very palatable to a lot of people. So, you know, this is a bunch of crypto bro is going to get rich because you bought, bought their bags. And you've got, you know, the poor person over here suffering and that money could have gone to some sort of enhanced government program.

I just don't think that's very smart politics. And at the end of the day, I think people are being a bit delusional as to what's going to happen. Yes, maybe if a government had already seized Bitcoin like the United States, has 200,000 Bitcoin that they sees from other people. And they say they're not going to sell it while Trump was in office or the Republicans or whatever. Fine, I get that. But, you know, on the witness what Trump said in a budget neutral fashion. So he isn't even going to print money and basically buy Bitcoin.

So I'm not sure what people are really getting all excited about. I think you'll need to think a little bit more about if you're a politician, was this what you really would do? If you had the money printer or if you had a pilot. savings to do something with. Yeah, yeah. And at least this first iteration, they're not acquiring. They're just taking forfeited Bitcoin, but they are looking for budget neutral ways to acquire more. In your recent newsletter, The Jeannie, so, you know, as you just said, you don't necessarily support the U.S. government proactively acquiring Bitcoin. But you kind of propose something interesting about using Bitcoin to pay down U.S. debt. Can you walk the

through that idea? So I think at the end of the day, apart from that one chart of rectifying global trade imbalances, Trump and Besson and this cabinet need to reduce the value of the dollar globally. They need to value massively. And I think they will at some point. And you can do it versus gold or I think you can do it versus Bitcoin. You could do it versus both. But at the end of the day, I think if they're going to be revaping the global trade system, then the U.S. Treasury is not going to be the reserve asset anymore. It's going to be gold. I would love to be Bitcoin, but most likely it'll be gold. And at that point, you essentially need to devalue the stock of treasuries versus the new neutral reserve asset. And so I propose a scheme by which you could essentially

bid up the price of Bitcoin and dollars by saying, I'm going to issue fiat bonds and buy Bitcoin for people at very, very high prices and devalue the stock of treasury debt and sort of create a sort of a new global trading architecture centered around and balances being settled in Bitcoin. Yeah, I find that interesting. So let's now talk about some recent events that I know are very much in your wheelhouse. There was a big brouhaha over the jelly attack on hyperliquid and how hyperliquid handled that. Since you launched the original perpetuals exchange, I was wondering what your opinion was on how hyperliquid overrode the Oracle. And even the fact that they're, it's like the Oracle is managed by them, that they gave a favorable price to themselves so that they ended up closing on the position at a profit.

And also, well, the reason they did that was because it was, it was going to be their own market maker that would lose money. So what, what's your opinion on everything that transpired there? So obviously, I think people need to recognize that, you know, decentralization is a pipe dream and a lot of these projects. And I think we were very well situated as to where hyperliquid stands on that. I'm not really deep into their tech or not. But it looks like a duck coaxic, like a duck is probably a duck kind of thing. Yeah, apparently they made the decision in two minutes. And I saw some supporters saying that, oh, but there was like a real quote-unquote vote.

I'm saying they just acted quickly. And everyone was like, yeah, it's because it's centralized. But anyway. So I think, you know, obviously at BitMex, we dealt with a lot of the same. issues on you have a high leverage product, you have any liquid contract, and you have this big pool of money that's there to essentially protect people when traders going bankrupt. And obviously, people are going to start to try to game that system. So I just think that the developers and those in charge of hyperliquid probably just need to read the exchange

docs of every other major sex that just copied the BitMex model. And they'll probably, this will never happen again because we face all the same issues of how do you, you, you know, dramatically reduced leverage as people get larger positions? How do you liquidate people in an aggressive fashion so that the liquidation fund doesn't lose any money? I think they probably need to review their margin policies a bit more carefully. And then, you know, these smacks of centralization in a supposedly decentralized project won't really come to bear. But again, this is nothing new. If you look at some of the things that happened back in the day, with Bitmex and some of the other major sexes, we've dealt with all the same issues.

There's nothing under the sun that's new here. It's just that certain people haven't really internalized those lessons or they weren't trading back of the day when some of the stuff was going down. And you don't think it's a big problem, how centralized they appear to be? I mean, I guess that's really up to, you know, those people who, if you really believed in that and if that's your guiding star, I need to invest in a decentralized platform and therefore I no longer want to use hype, then fine, but I don't think most people care at the end of the day. Decentralize, centralized.

If the price is good, if it's fast, if the fees are good, they're going to trade there. Whether or not how it's validated or how it's run is kind of irrelevant as long as they get it and out and they get the P&L they thought they were going to get. Yeah, yeah, that's true. All right. So in a moment, we're going to talk about a twist in that saga, but first, a quick word from the sponsors to make the show possible. If you love the conversations we have here on Bits and Bips, you're going to love our brand new Bits and Bips. newsletter. Our team will break down the key macro trends impacting crypto, the biggest market moves, and expert insights you won't find anywhere else. Whether it's the Fed, inflation, or major Dow proposals,

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on YouTube or X. Back to my conversation with Arthur. So there was a further controversy about hyperliquid, which was the fact that Binance and OKX quickly listed Jelly Perpetual's features, which made it easier for traders to participate in the short squeeze. And I wondered what you thought about Binance and OKX's move there. I mean, for those of you who understand some of the history between the founder of the firms, I thought it was quite hilarious that they were actually cooperating on something

for a start, I'll leave it there. But it's interesting that you have this sort of decentralized versus centralized situation. And at a fundamental level, I think the decentralized model in the long term, maybe not today, it's probably a superior model in terms of running some of these markets. And you can see why OK and finance would be very threatened by hyperlocut and the quick growth that they've notched. up in the last year. I think there's something like 10 or 20% of their volumes. And they've done that within 12 or 18 months, whatever the figure is. And so obviously they're cooperating to essentially try to make it very obvious that hyperliquid might not be as a centralized as they advertise

on the tin. And maybe they think people care. We'll see about that or not. Right. But at the end of the day, I think it's up to the users. Do they like the trading experience at Hyperliquid versus some of these other platforms. If they still like hyperliquist trading, you know, things, then they're like, oh, great. You know, the protocol protected me. However, they did it, whether it was centralized or to centralize in terms of that decision making, who knows, who cares.

And I'm going to keep trading there because, yeah, the jelly thing fucked up. They fixed the issue and trading resumed. And, you know, everyone was okay. So I think it's interesting to see who's threatened and who's not. and these actions by the largest sexes against this new upstart decks is very instructive in that respect. But from the client perspective, they're like, great, I don't care, right?

I made whole. I can keep trading. Fees are great. Hyperliquid, great. You stood up. You got attacked by the big guerrillas in the room and you stood up for yourself. So I think there's definitely a narrative here of like a David versus Goliath. Like, you know, human nature loves to support the underdog.

And so while maybe OK and Binance thought they were. doing something smart by, hey, look at, they're very, really centralized. At the end of they, you know, the clients might be well, well, you guys are trying to like gang up and fuck over the upstart. Maybe I'm going to go over a trade the upstart and I want to buy some hype tokens because I really want to support this underdog, underground, you know, movement, non-VC backs, all the sort of narratives that really propelled the hype token from, I think, $3 when it launched to up to $30. I mean, I was down to 12 or 13 or whatever. But, you know, I think this could really be positive for the price in the long term as you've really put some more attention on what's going on and what is pretty much a sleepy corner of the market.

I don't know if you saw it just because your comments there sort of echo some things that Kevin Joe of Galois Capital said. I don't know if you saw his tweet thread. No. But, okay. So he was talking about this decision by Binance and OKX. and he said, quote, every decision sets precedent for the future. Finance and OKX listing perps and hyperliquids face does help their short-term incumbency status, but it also sends the message to other sex and decks competitors

of what to expect if they take on bad liquidations. And he said he felt that Challenger exchanges would basically improve their risk management, thus making themselves stronger competition for the incumbents. And then he said that he felt that he felt, This would create a chilling effect on cross-exchange coordination attempts, such as like if they're trying to create clearing houses. He also added that this sends the message to the validators that hyperliquid would protect the value in the hyper-liquidity provider. And this could create over-investment in hyper-liquid. So, or sorry, in hyper-liquid.

Oh, my God, there's just so many hyper-liquidsts in hyper-liquidity provider. So then he said, if HLP investors know they capture full upside and will get bailed out on big downsides, more capital will come into the value and drive down yields. So there's like multiple different effects that he saw. And I wondered if any of those were interesting for you to talk about. Yeah. I mean, I think at the end of the day, maybe OK and Binan should have picked a bigger contract to try to fuck them on and wants a fatal blow because I think he's right, right? JL the contract, I think the loss is something like $10 million or $20 million that basically was an illyrated, right? For our exchange that trades billion dollars a day and notional, it really isn't that big of a deal in the grand scheme of things.

Hyperliquid obviously survived. They were able to rectify the issue. You know, they acted in a way whether you think it's essentialized or not. And they solved it. And boom, they're off to the races, right? And now they're never going to make that same mistake again, which I shouldn't have made in the first place, if they just read the docs and Binance and okay, because we've all solved this problem before already. But they, I think they should have picked a different contract.

If their goal was, let's really put them to the ground. Now they've just made them stronger. They've put a highlight on the issue. They've, yeah, they've put the moral hazard upside into people's minds. And the same moral hazard as of like when people got bailed out on the buy bit hack, right? You buy big loss if one and a half billion dollars of Eith, Ben reached into his pocket, paid everybody. Everyone's like, great. Counterparty risks, that doesn't exist. They're just so fucking rich. They're just going to bail us out every fucking time, right? Let me keep trading there. Same thing. I can invest in HLP because I know that the validators are going to make sure that, you know, heads out, went, tails I lose. Great trade. I know I should invest in Bitcoin

because tariffs are happening because I know if shit really fucks up, Jerome Paul is going to get on that podium and he's going to make sure he prints that money. It's all the same trade. Yeah. Yeah, I think the last thing about this that I saw people criticizing was I guess there had been something previously where like North Korea had been able to use hyperliquid. And people were really upset that at that time, they were claiming they were decentralized. And then over a potential $15 million loss in their market maker, suddenly they like sprung into action within two minutes.

I don't know if you have thoughts on like this kind of dilemma of, you know, especially because North Korea is considered not only just like a big threat in and in and of itself, but then that is the kind of thing that gets the U.S. government to also want to take action in a way that kind of friends the whole. It's a, it's the dilemma of decentralization, right? It's, well, I do I only want the good things, not the bad things? Whatever I believe good had met is. am I immune against nation state actors, both on the, you know, using my platform or the

ones that don't like that nation state coming after me? Like, it's all the same sort of philosophical debate. And I think as a investor or a trader, you have to sort of weigh all those risks and make a decision at the end of the day. There's no really right or wrong answer on this. I think we're still debating this in terms of how centralizes, pick your L1 or pick your L2 in the sequencer. It's all the same. sort of conversation, all the same sort of risk profile, and then you as an individual investor have to sort of weigh all those things and then come up with what you actually care about. Yeah, yeah. And those teams probably should as well. And sometimes the lines that they draw

sort of like not always super consistent, but anyway. Well, so speaking of violations that get the government to take notice, you actually experienced recently a, kind of reversal when it comes to government opinion. On March 28th, President Trump granted pardons to you and your co-founders at BitMex, as well as another former employee. And this was in response to some agreements in 2022. You all pleaded to violations of the Bank Secrecy Act at BitMex, which was the company founded for failing to maintain anti-money laundering and know your customer programs. And so obviously President Trump has been making a number of pardons, including to

Ross Ulbik, the founder of Silk Road, which is a very different type of Bitcoin-related venture. But, you know, the crypto community obviously took note of this. And they were very curious to know how the pardon came about. I mean, I guess it's a very, well, I have a sample size of one in terms of how these things work. We have some advisors. They wrote a petition on our behalf of why we think we deserve to pardon and all those sorts of things. We submitted it to the proper channels at the White House. They evaluated it.

And we're very thankful that the Trump administration thought that our case deserved a presidential pardon and the company as well. And so, yeah, it's as bland as simple as that. But obviously, it's luck or the draw, right? It's one particular person and the people around him making these decision as to who they believed deserve this commendation within sort of the United States legal structure. And does that entail any kind of donation? Sorry, yeah, donation? No. Oh, okay. Interesting. I also saw that David Hoffman of Bankless tweeted a question at you, you know, when you tweeted about this. Because, you know, you already paid a $10 million fine. You already served six months of home

confinement, followed by two years of probation. And he, um, he, you know, he, you already paid. And he, asked you what changes for you logistically since you basically already kind of paid the fine and did the time. So what is that, like, what does the pardon actually change? I said, waiting for an answer for my lawyers. I mean, it's a feel good factor and all that good things, but like actually what it means in the specific United States legal theories on how this works, I'd have to say, I don't know when I'm finding out. Okay. Well, one other thing is we saw back in January, Malstrom, tweeted that you and at least one other person at Maelstrom went to Mara Lago. And the Mailstream account said, quote, in the future, we'll share more about our experience,

our learnings, what we hope from D.C. in the coming years. I think you might have shared some of it in that newsletter, the genie. I don't know. I couldn't tell, because it came out after, but I don't know, I wasn't sure from the way it was written if that's what was being referenced there. But could you talk a little bit about that visit? Yeah, sure. It was a very interesting experience. Obviously, Southern Florida is a beautiful place. Marlauago is a very beautiful country club resort kind of thing. And we were invited by the, it was a Vietnam summit, friends of Asia. And somebody reached out, hey, we'd like to have someone come and talk about crypto and how you think that the United States should approach crypto policy. There'll be a few, you know, Congress people, possibly some senators.

maybe Trump did not show up to this particular event. So I went and I gave a short speech on sort of my ideological bet on how regulation should be pursued if the goal is sort of maximum crypto adoption and he want to have people building in the space. And essentially I gave crib notes to an essay I wrote, I don't know, six or nine months ago. I forgot the name of the title. And it was basically saying that for crypto regulation, my advocacy is for something akin to how the internet companies were regulated back in the early in the late 90s, which was, hey, hands off, you guys can pretty much do what you want. We're here for innovation. We're not going

to prescribe different rules. Obviously, don't like, you know, defraud anyone or doing those type of things. But we're not going to make some, like, massive bill of legislation that requires lots of lawyers to parse. And so that was sort of my pitch to the room. And I've, you know, continued with that pitch in terms of, you know, when people said, what do you think about regulation? I think there should be pretty much none of it and allow people to innovate and obviously punish people who steal people's money and do those kinds of things, right? So I think if some country enacts that sorts of policy, you're going to have a lot of crypto people moving to that particular jurisdiction because they feel that they can innovate and create the next generation of

financial products and, you know, make a really cool thing. So that's sort of the same speech that gave to the crowd in Marlago. And it sounds sort of like then you would be on board with SEC's commissioner, Hester Persis, like token safe harbor idea? I have no. I don't even know what that means because I haven't read the bill. So I can't really comment on that. Okay.

Yeah. It's just where entrepreneurs could experiment. They could attempt to build something. They wouldn't necessarily have to jump through any regulatory hoops. but then within some certain time frame, I think. And granted, this is like from years ago, I actually am not super familiar with whatever the current iteration is, but they would need to decentralize,

and there would be some metrics by which that would be measured within some time frame. So speaking of Trump world, the Trump family has gone all in on crypto. President Trump and Melania have their own meme coins. The Trump family now has majority stake in World Liberty Financial. World Liberty Financial is also launching its USD1 stable coin. the Trump family is getting into Bitcoin mining with American Bitcoin. And I was curious, like, what you thought of all this activity from the president and the president's family,

especially given potential issues around conflicts of interest or, you know, things that could, I guess, be considered something more akin to like a bribe in, you know, in the government. So I guess from my very limited knowledge that I'm not, you know, deep in the political weeds on what the Trumps are, aren't doing. From my understanding, the only thing directly that Trump himself, the president did, was the meme coin. And obviously, his, the first lady did the Melania meme coin. And I wrote a whole essay about how I believe political meme coins are a great thing in terms

of bringing transparency to campaign financing. Obviously, I think we're very early in that journey. Maybe we'll see some more political meme coins in the 2006 midterm elections. but in general, I think it's a great thing that Trump has launched his meme coin. Yes, it went down 95% from the high and all that kind of stuff. But at the end of the day, what it allows for is validation that, hey, if I'm an upstart politician and I'm facing some dominant incumbent who's got all this money from all these vested interests, you know, corporate vested interests, individual people can help fund my campaign by buying and holding my meme coin and I get real-time

price information on what the people think about my policies. So it's a much better barometer of public opinion because when people's money is on the line, then they vote with their wall the way they think they actually are going to vote. Similar to how the polymarket was a good predictor of the outcome because people put money in the line, you're not going to lie on a polymarket. You're not just going to play the game if that's the case. But you will lie to a pollster in terms of what you actually believe politically or who you intend to devote for. So I think the political meme coin as an asset class is a great thing. And I think, you know, we're going to see more of these things probably in the next two to four years if we have some more elections.

It'll probably start in the U.S. maybe some other European democracies experiment with this new way to fund and attract engagement. So I think that's great. On what Trump's family members are doing in crypto, great. I mean, they're joined the party with the rest of the, you know, James people across the world who are, you know, mining Bitcoin, buying shit coins, trying to build DFI apps, all for it. All right. Well, let's talk about some other DFI ventures that are making their own moves. Athena, which you, you know, that's your own brainchild and you are also an advisor and investor. Correct.

It's building its own L1. People, you know, are, I don't know, I saw a lot of. opinion saying that this was not good for Ethereum. Can you give us some insight into how it is that that idea came about and what you think the impact will be on Ethereum? So I just did a podcast with Guy and he went very deep on the converge chain that they're building. So essentially what he's saying is, hey, we've got this price neutral way to generate yield in dollars. But that relies on the crypto ecosystem. to generate this yield. You have a lot of triad-to-fight institutions who want a low-volatility

high yield relative to treasuries or some sort of government bond strategy. They don't necessarily want to trade crypto. They think it's too risky, kind of party risk, all that kind of stuff. But they could capture sort of the crypto activity in these elevated yields, which is sort of the the basis yield or this is the yield that you're capturing when you're buying US, staked USDA from Athena. And so they say, okay, well, how do we bring these two things together? So how about we create our own L-1 and we give these traffic institutions some of the permission that they need to allow them to invest on an on-chain asset with, you know, KYC

white listing, all that kind of stuff, right? So let's build a purpose-built thing that fits the use case of, what we're trying to do as that's what they're building. And so their goal is, hey, I'm XYZ large hedge fund or pension fund or asset manager. And instead of earning four and a half or whatever the Fed funds rate is right now on a T bill, I can earn 8, 10, 15, 20 percent based on these, this synthetic dollar from Athena. And I can buy it in a way that my regulators and auditors are comfortable with on this new chain that fits all my specifications. And so that's what he's hoping to do, guy, the founders, take those hundreds of billions of dollars, bring them into the crypto

ecosystem via this chain and via this delta neutral synthetic dollar product and meet them where they are instead of saying, hey, this is, you know, decentralized crypto, you need to trade on X, Y, Z different chain and just to fucking deal with it in terms of how that works. That's his goal. as I understand it. Whether or not it's good for Ethereum, I mean, if people believe that sort of app chain-based L-1s or L2s, or if you want to call this, are bad for Ethereum, then I think that ships already sailed. So many of these things already. So if that's what you believe, then I hope you don't own Eith. And wait, when you say that, you're talking about the kind of like RL2's parasitic to Eith question? Yeah, all that kind of thing. Or like,

If I have an ecosystem with a bunch of users, I'm not going to use the dominant L1. I'm just going to create my own app chain-specific thing with my specific use case kind of thing. And therefore, I don't need to use Eith or Solana or whatever. Make sure, L1. And I mean, yeah, so that is happening more. But that creates fragmentation. Do you feel like it just is the future that we're going to have this whole fragmented ecosystem or?

I mean, I think it depends on how much security that do you need, right? If I'm a pretty much centralized thing, so Athena is not decentralized, right? It parks a bunch of collateral on centralized exchanges and third-party custodians and then offers you a yield that they actively manage. So they have protocols of how they determine where capital goes and those sorts of things. But it's never said it was decentralized and it isn't decentralized. And so when you build your own app chain, I don't think security is the biggest concerned or sort of censorship resistance and all those sorts of things.

So you were centralized to begin with. You never went out there saying you weren't. However, if you're some application that requires decentralization, that requires hardness against, you know, nation state actors or very bad individuals at the fundamental protocol level, there's something like Ethereum makes a lot of sense. it's the most secure L1 out there based on the value that is at stake in the POS system. So again, it depends on what you need from the blockchain. Well, we have lots of fragmented app chains, probably,

but there will be that one or two applications that require the security and the decentralization at Ethereum or other L1's attempt to bring to the table, and they're going to have to pay for that. And the users are going to have to pay for that. But it's okay because what you're providing to the users is something, is that's what they want. So I think that is probably the future. We have both things.

It just depends on what you need. Okay. Yeah. Honestly, this converged thing, the way you described it, it honestly reminds me of R3. Do you remember that?

Yeah, remember them. Yeah. Okay. So I know that on the face of it. So I'm not going to like ding guy here and ding my advisee saying he's like Arthi because Arthur is a piece of shit. And,

you know, there's a reason why it doesn't exist anymore. Yeah, yeah, yeah. I didn't mean that they were like literally similar. What I meant was the concept was a little bit similar. Obviously, Arthi was super different because it was supposed to be like all these different banks and financial institutions come together and then have this chain and, you know, converge. Obviously, it's more crypto-native. It's not, it's not anything like that. And you're right. Yes, of course, they have a real product. But it is just interesting. It's sort of like a separate playground. So, you know, I guess like, like, To me, yeah, it does raise that question of, you know, I thought the future was going to be defy connecting to TradFi. And now it feels like the way that this is shaping out, it might be more a little bit separate. I guess there will be connections, but still slightly separate areas of play. Well, so while we are talking about Ethereum, there's, you know, just been so much handwinging generally in the Ethereum world. And I know you described Mailstrom as holding

mostly Bitcoin and Eith. I know you've had salty takes in Salana at the same time that you also were trading the main coins and stuff. But, you know, right now, it does still feel like there's kind of this, I don't know, you know, a competition between Salon and Eith. And it's sort of a question of how it's going to play out. And I just wanted to check in again. I feel like I've asked you this question multiple times when I know it might shift. So, yeah, what's your outlook for both of those chains right now? So I guess the best way to think about it is if you have a fresh unit a fee out of capital, what do you do with it? Do you buy Salana or do you buy ETH? Right now, given all the things that are happening. And so I would say ETH from a risk reward perspective is

better because it's as hated as you say. Whenever you have a turn in the cycle, you want to own the most hated thing because that's going to perform the best. And you don't want to own the most love thing from the previous cycle because that's going to perform the worst. That's not to say that Salana's not going to go up a lot. But relative to something else, is it going to perform as well? And so I think ETH has sort of the market fundamentals to do very well in this next leg up because people hate it so much. And so, you know, if it starts rising a lot in price, then you start getting on the,

oh, no, ETH is you back, right? And everyone forgets all the things, the reason why they hated Ethan in the previous cycle, and then they jump on the bad wagon. And I think from Salon's perspective, you know, Solana did it very well on sort of the meme coin super cycle. whatever you want to call it over the last 18, 24 months. But I think that yes, there will be some meme coins that do well if my predictions on Fiat liquidity come true.

And so we get a Bitcoin rally to 100 or 250,000 or whatever. Right. There will be some meme coins that do very, very well. But are we going to go back to where we were 12 months ago where everybody and their mother was just like slinging meme coins trying to find the $1 million market cap that goes to 100 million dollar market cap and gets handing hundreds of millions of dollars. and fees to pump fun. I don't think we're going back there. And so I think all that activity that was on Solana based on meme coin trading won't be there. And so the narrative of, oh, meme coin training is

amazing. It's the anti-VC way to participate in crypto. It's on Solana. Therefore, I need to own Solana as the L1 that host of all that activity. I think that narrative goes away. And a similar way that NFTs did very well in 2021. ETH is the home of digital art, right? That was a narrative back that's why I need to own ETH. There's so much activity in NFTs, so I need to own ETH, right? And NFT volumes still haven't recovered to where they were in 2021, even though we're much higher in terms of a global crypto market cap today. That's not to say NFTs are dead. It's just certain things did well. Most things, you know, what's zero or near zero. Similar with mean coins. There will be some things that survive. Most of them will not. And the fervor around trading these things is going to shift to

something else. Now, if again, if that is located on Solana, then great. then that Salon can do very, very well. But if that fervor is not located on Solana, then what is the thing that's driving these transaction volumes on a marginal basis that's different from where it was previously? That's the question. And obviously, I don't know the answer to that. We'll see how the feature plays out.

But I think that's a big impediment for Solana retaking, what is it, a 280 or 300, whatever that number was at the all-time high earlier this year. So I don't know if you have thoughts on this. and you can decline if you don't. But, you know, everybody's also talking about Ethereum's tokenomics, like how to fix them, how to fix this issue with the L2s. Like, if you were in a position to, you know, kind of push Ethereum in a better direction from a price action perspective, and I don't mean short term, but just, you know, like

more of a tokenomic perspective, what would you do? I, to be honest, I have not studied in depth enough the tokenomics to be able to give you an answer to that question. Okay, okay. So we have news that just came out. That circle plans to do an IPO very soon. And, you know,

the valuation being floated is like $5 billion. You know, there's a number of kind of interesting tailwinds and headwinds that it's facing in different ways because, you know, stable coins are at this inflection point, like tether's, you know, gigantic. There's the stable coin legislation coming and then there's all the macro stuff that we talked about earlier. So I wondered if you had thoughts on how you thought that IPO might perform or just generally circles prospects in the future. So I've been on record saying I think the circle like IPO is dog shit.

That doesn't mean it's not going to go up with a list, but would I buy it? Absolutely not. So first of all, I think Tether is great because it offers essentially dollar rails, dollar banking to the entire world that's not. America, right? Americans have dollars. They have a baking system. It kind of works. They've got Venmo if they don't want to use the banks and cash app and Zell and all these sorts of things, right? So you want to send a digital dollar around America. You can do it. It's pretty easy. If you want to send a digital dollar in China and Argentina and Southeast Asia, that's difficult, which is where Tether comes in, right? But if you think about the client basis of Circle versus Tether,

Tether is a global ex-America thing. Tether is a United States thing. And so I think that from a fundamental basis, the client base that's going to use Circle already has a lot of alternatives. And they're going to have even more. Now that you have maybe one of these stablecoin bills comes in, you have competition from the large money center commercial banks who want to offer their own digital dollar stable coins. You have all this competition. And at the end of the day, the only thing that Circle makes money on is net interest margin, right? They have a bunch of dollars. the Boston Treasury bills, they have a spread. Now, they already don't make the full nym because they have to hand it all off to Coinbase

because Coinbase is essentially the distribution partner. So Jeremy O'Lear is Brian Armstrong's bitch. And the question is, how long will it take for Coinbase? How low will the price of Circle Go and then Coinbase just buys them? I think that is your exit liquidity for this trade. If you want to trade this IPO, it's OK, when does Coinbase buy Circle? Because without Coinbase, Circle is a zero. And so they're completely dependent on the distribution arm of Coinbase to survive because that's where most of their dead interest from income goes to is to Coinbase and then Coinbase distributes however they distribute it.

So I don't like buying bitches. So why would I buy Circles IPO? If you want to own the top dog, just buy Coinbase because at the end of the day, you know, they permission Circles existence. So that's what I think of that particular IPO. Yeah, yeah, I saw a lot of takes saying, you know, not too dissimilar things. So obviously at Mailstrom, you're investing in all different kinds of projects. I believe you do pretty small amounts, like 50K to 100K. Correct.

How do you assess potential investments and what types of projects are you interested in now? So, you know, from my level as a CIO, I don't really look into the weeds on most projects. The guy who runs the book, Achshad Vydia, he's the man with the plan. I just sign the checks. But my direction is more on very stringent limits on the price that we pay. So if we can make a lot of bets that we pay very low prices, then it's very hard for us to lose money on an aggregate basis, even if we don't do so well in picking things.

So that's probably the number one discipline that I enforce on his team is, okay, we don't pay more than X. We don't sort of get sucked into the, oh my God, this is the hottest project ever, XYZ major other crypto VC is doing it. We need to do it too. We don't get involved in that bullshit. Great. Mostly because there's no LPs other than myself. So I don't need to have a marketing of I'm always in the biggest deal like, you know, pick your name brand VC fund to justify to clients why you charge and 20 or three and 50, whatever they charge our clients. I'm not, you know, charging fees based on access. I just want to make more money for myself

and for the employees. So we're very, very string. on the price that we pay for things. And the cycle. So I'm advising on where do I think we are in the cycle? So earlier in this year, I was a much more bearish. I thought, you know, we're going to top out. So the optimism over what's going to happen in the U.S. markets was overdone. And so we were trimming and selling down lots of positions.

I still think, you know, when I check in with auction, I'm like, well, how's pricing going for early stage deals? He's like, it's just too expensive for the level of the stage of development of a lot of these projects. People are demanding massive, you know, initial fully devoted valuations for, you know, basically just a pitch deck. And yes, there are the occasional one or two deals where they're going to grow into that valuation and do very, very well. But for the most case, you're just locking in a loss at the end of the day. And so we're actually not that active right now in the early stage game. We're more just evaluating other than beating down

high quality projects. And maybe we also have a relationship with them, either we've invested with them or we've advised them or the team's been looking at them for a while, or we should be deploying a lot of our liquid capital because we've raised a lot of cash from doing well in the 2023 to 2024 cycle. And obviously, the game is to continue to increase the value of that.

So we should be looking forward those types of projects. So that's where we're more focused on liquid, where we can deploy larger amounts of capital into things that we believe are beaten down in this sort of alt-coin decimation that's happened over the last probably like six to nine nine months. Okay. So last quick question, I feel like every time I talk to you,

we talk at the end about price projections. I know we already talked about Bitcoin, but that was kind of like a short-term thing. And I saw another tweet that you had recently. You said, if we hit 110K, then it's YATSI time. and we ain't looking back until 250K. So that was Bitcoin. And then the other tweet that I saw was

each to $5 before Saul to $300. So can you explain? Oh, oh, 5K. Sorry, right. Yeah. So what, yeah, what, that doesn't make any sense, $5. So what goes into your thinking on all three of those? So again, it's this, I want to, if I'm going to,

on a risk for war basis, in a new cycle trend, I want to own the most hated thing. and not the most loved thing of the previous cycle. So what's the most hatist L1? It's ETH. So I think ETH could be the dark horse that does very, very well and could retake its previous all-time high of $5,000 back in 2021. Before Solana goes up, I don't know, two or three X to retake its previous all-time high of three months ago of $300.

That's sort of the trade that I would be making if I have fresh capital. Now, I'm not deploying any fresh capital into ETH. I guess I'll hold a bag of it. So it's not really an apples to apples comparison. But that's sort of how I'm thinking about the market, right? You've got a unit of Fiat. Your goal is to maximize that unit of Fiat by owning the thing that goes up the most. That is the goal.

And then, but for Bitcoin from 110 to 250, that's like more than double. So how are you making that projection? So again, I think, you know, when we're into the third and fourth quarter, we're going to have the United States, China, Japan, and the EU all printing money, all providing financial accommodation because, you know, they need to safeguard the value of their government bonds. They need to make good on the promises to their electorate. And you have sort of this reorganization of the global finance and trade ecosystem initiated by Trump, but now everyone else has to react. And what the reaction is, I'm going to print money and make it okay for you. Don't

worry. That's what the political answer is to Trump's tariffs, I believe. And therefore, by the end of the year, we're going to be swimming in fiat liquidity. And, you know, Bitcoin at $250,000. We might even be higher if, you know, if we get the sort of gusher of liquidity out of the major trading blocks that I expect. All right, Arthur, well, it's always a pleasure. Where can people learn more about you and Maelstrom? So on X at Crypto Hayes, on Substack, we have the Crypto Hayes, we have the Crypto blog and yeah, that's where I am. And at Mailstrom. At Mailstrom Fund on X as well.

Perfect. Well, it's been a pleasure to have you on Unchained. Thank you. Thanks so much for joining us today to learn more about Arthur and Mailstrom. Check out the show notes for this episode. Unchained is produced by me, Laura Shin, with all from Matt Pilchard, Juano Van Vandvich, Megan Gavis, Pamma Jimdar, and Marka Curia. Thanks for listening.