Unchained - Bits + Bips: ETH Makes a Comeback While Crypto’s Animal Spirits Revive - Ep. 876

Episode Date: July 29, 2025

What’s fueling crypto’s market surge?  This week on Bits + Bips, Ethereum’s rally has reignited market energy, triggering fresh questions about the return of alt season, and whether Bitcoin’s dominance will continue to fall. With special guests Katalin Tischhauser from Sygnum Bank and Wintermute’s Jake Ostrovskis, we dive deep into how corporate treasuries, tokenized assets, and shifting ETF flows are reshaping crypto’s microstructure.  Plus, we dissect the macro impact of rising tariffs, the Fed’s delicate dance with Trump, and whether tokenization could breathe new life into the US dollar. Check out the sponsors who make this show possible! Bitwise Mantle Hosts: Steve Ehrlich, Executive Editor at Unchained Ram Ahluwalia, CFA, CEO and Founder of Lumida Guests: Katalin Tischhauser, Head of Research at Sygnum Bank Jake Ostrovskis, Head of Sales Trading (OTC) at Wintermute Links Markets:  Unchained: Spot Ether ETFs Extend 16-Day Inflow Streak With $453 Million DATs: Cointelegraph: Tron Inc. seeks $1B to grow TRX holdings as stock rallies CoinDesk: Crypto Treasury Fever Spreads to Ethena as $360M SPAC Deal Targets ENA Accumulation CEA Industries Inc. Press Release: CEA Industries and 10X Capital, with the support of YZi Labs, announce $500 Million Private Placement to Establish Largest Publicly-Listed $BNB Treasury Company in the World The Block: Specialty finance company Mill City announces $450 million offering to establish corporate Sui treasury Barron's: MicroStrategy to Offer Preferred Stock With a Twist That Could Yield 10% Trump and Powell Fortune: Jerome Powell had a surprise visit from Trump. He's poised to leave interest rates unchanged anyway CNBC: Trump spars with Powell over renovation costs during Fed visit, but backs off firing threats Timestamps: 🎬0:00 Intro 🔥 6:03 Why ETH’s comeback is reigniting crypto markets 🧠 11:23 Why Ram says “animal spirits are back” 💸 15:06 When tariffs could finally start pushing prices higher 📉 18:06 Whether BTC dominance is fading—and if alt season is finally here 🏭 22:27 How tariffs are already hurting some businesses ⚖️ 27:49 Whether Strategy’s new preferred share class adds risky complexity 🏚️ 32:32 Why many new treasury-backed projects might not survive 📊 38:29 Whether these digital asset treasuries (DATs) are trading at unsustainable premiums 🔮 51:28 What the real endgame is for all these DATs ⚔️ 59:00 How the Powell-Trump tension could shake up markets 🔗 1:12:44 Why tokenization is gaining momentum across finance 📈 1:18:55 Whether stablecoins could revive global demand for the US dollar Learn more about your ad choices. Visit megaphone.fm/adchoices

But you know, when you say consolidation, like it's already the fact that a third and targeting a half of the liquid supply of Bitcoin is owned by a small US company, that makes Bitcoin inappropriate for any central bank to hold as a digital gold central bank reserve asset. It's already a problem for large corporations like Microsoft, Amazon, Meta, McDonald's, voted this down to buy it and put it on the balance sheet because a small company controls so much of the supply. So it's actually closing off very exciting, much more promising use cases for Bitcoin. And if there's even more consolidation, then that's even more the case. Hi, everyone. Welcome to bits and bibs, where crypto and macro collide one basis point at a time.

I'm your host, Steve Ehrlich. I ascribe of the Unshamed Kingdom. I'm here with Ram Alawalia, Nistair Welk, leader of Lumila. And we have two special guests. And we have two special guests. First, we have Catalan to Showser, emissary of truth for Cigna. Ketalin, welcome back. Thank you.

Thank you for having me. And one more special guest for today. We have Jake Ostravascus, the high trader of Winterviewed House. of Jake Wapke. Thanks for having me. Good to see everyone. Everyone here gets a Game of Thrones nickname. Knowing our audience, everyone's seeing.

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Check it out at bitwiseinvestments.com slash CIO memo. Carefully consider the extreme risks associated with crypto before investing. Jake, this is your first time on the show. Why don't you just take a minute to introduce yourself and tell everyone what you do at Wintermeet? Yeah, no, fine, absolutely. I mean, before joining Wintermew, I was in a global macro seat, so straight out of university. What's straight into the by side was lucky enough to have, I guess you'd call it a fairly quick education in the markets very early on. So trading a very broad range of assets, mostly around sort of thematic, volatility-driven events.

That could have been like an OPEC meeting. It could have been an earning this announcement. And we were leading into sort of single stocks or it was a central bank decision or it was a debt crisis. So really spent early part of my sort of career. You could call it ambulance chasing. That's when I guess the opportunities arose. And naturally sort of looking for volatility. And that's how I found crypto.

And I joined Wintermute just sort of. Got the bug, decided to go there full-time, joined Wintermute. For those who don't know what we do, we're a proprietary trading firm, predominantly trading algorithmically in digital assets. So my role is on the OTC franchise where focusing on high touch execution for wholesale and your corporate counterparties. So, and that's everything covering sort of spot and derivatives, anything from sort of options, NDFs, all those sort of wonderful things that now are finding their way into, I guess this sort of new crypto world.

So I was just going to say, thanks, Jake. We have a lot to talk about today. A big data dump this week. FOMC meeting begins tomorrow with the latest inflation. I'm sorry, the rate decision on Wednesday. I know most triggers are still expecting it to stay the same. But who knows, just given the dynamic between Trump and Jerome Powell, maybe we'll see a couple of the cents, which that in and of itself would be

a bit of a history making moment. Some large trade agreements have been consummated, Japan, the EU, so I'm really glad that we have two Europeans on the call today. Although Jake, I know we were talking slightly right before week when live that I guess you're European, it depends you ask if you're a European or not being from the

being from... Switzerland's also not in the EU, so you don't have any EU representatives, yeah. Fair enough. So we have two Europeans by I guess geography only, if that's the right way to say it. A lot more crypto treasury news. Goldman and V&Y are tokenized in money market funds. There's a ton to go over.

Crypto is still ripping. So we're going to dive in, but just first, just a quick disclaimer, nothing that we say here is financial advice. We see the uncheekyencryptu.com backslash bits and bibs for more information. So I think it makes sense today to just maybe begin with crypto. I mean, ETH ripped last week. Bitcoin's been kind of static. We've seen some alt coins surging.

Jake, I'd like to kind of start with you. One of the reasons I wanted to have you on the show today is just because, like, market makers, like yourself, you really sit. You almost have your finger on the pulse of what's how flows are moving throughout the entire ecosystem. So I'd love to just kind of see here. what you're seeing at the desk. Like, what are the types of things that the smart money is trading? What are they moving in of, out of?

And then, and then, Ron, I'll come to you next to kind of get that, get your perspective. Yeah, I think, like, yeah, as you said, I mean, a large driver of recent price action has been very dominated around the, I guess, rebirth almost of Ethereum. And what's that done is the price has gone up to the point where it's then created its own headlines. And that's sort of how this almost reflexivity has continued. I think definitely at the start of the year, up until fairly recently, ultimately people were fairly under-allocated to the asset in general. And so what we saw initially was a bit of a positioning move as people took off sort of long short legs at the very start of this rally hire. And then we've also then had sort of the narratives. Then you have treasury assets like doing fairly large allocations into the asset.

And then people start, I guess, looking at it in terms of like a micro strategy play similar. with obviously Sharp Link and I guess you could call them the sort of micro strategy copycat. So I think that has then sparked this return of animal spirits and I guess it helps the S&Ps at the all-time highs as well or has been. So I think you've got this general widening of animal spirits. You've got a theory about performance which is pushing a lot of people into different assets. So naturally what you then see is people starting trying to almost like stock pick. So we've had a little come off or drop off in, I guess,

cross-asset correlations, so like in the top 100, for example, if you look at those readings, unlike at the start of the year when we're in a very macro-driven environment, it felt like, and then we obviously had Liberation Day, and obviously that was now feels like it's in the rear view and everything was just moving one-to-one with risk. We now have this, I guess under the hood, there's a lot of dispersion and that just shows that people are putting risk on in different areas. We've seen it in B&B. We've even started seeing it in Salana a little bit at the end of last week. But yeah, I think it's definitely an exciting time.

We are seeing people moving portfolios around for sure. When you say stop picking, that's interesting because I know there was a story in the Wall Street Journal, I think a day or two ago, that traders, triathar traders are looking to kind of do the same, looking for some of those undervalued gems because valuation multiples are so high right now with all the major indices setting new highs almost every day. But the fundamental analysis is obviously different in crypto than traditional equities. So when you see this stock picking, are we talking about mean tokens that hopefully are going to get a big amount of social, a social wave that they're going to rise up? Or like what are traders looking at to sort of find those undiscovered gems?

I think it definitely depends on the category where we're talking about. Obviously, there's two sides really of this market and the two sides that we see. There's one, the retail side where it's very much sort of narrative driven. It's where the attention is at a certain point in time. And ultimately, that is very much driven by its pure sort of flow market. And I guess you could say arguably the same for the institutional side, but there is an element of, okay, well, there has to be some fundamental reasons here for people to buy it. And ultimately, I think the reasons that drive that is, I know when we spoke before,

always said that like when I first started trading crypto, it was dominated by, I guess, the institutional guys that were coming over from FX or commodity backgrounds and trading it just like that, like, okay, it's a risk on, risk off. You have certain drivers and most of its liquidity. Now, you could say that that factor is still very, very dominant, but within that we're now getting more equity market kind of dispersion where at the end of the day, an institution with LPs that has to explain investment decisions, has to look at something and make a case like, okay, this is the reason we've got this token because you've got this buyback or you've got this revenue going back to the holders or there's some way to value that. And that

is what we are starting to see, which I think is a very different market to, for example, obviously at the back end of last year or even the big rallies we've seen before that have been very sort of driven by this like manial almost, which was almost sort of more bubbly, whereas this time it feels a little bit calmer. We're not, we've not yet seen. a huge sort of capitulation. It's weird to say that when we're so far off the lows that we have gone so far. But I don't think we've really had the real sort of fizz that we've had before when moves have got really, really frothy.

And because people, I think, are ultimately focusing on where the real flow is and that's driven by the fundamentals. Ramm, I want you to respond to that. And I'm interested in one of the things Jake said that he hasn't seen those animal spirits really kind of poke their heads up yet. I know that's something you pay a lot of attention to, animal spirits. I'm sure we've all seen some of the meme stock rallies, the new variety, not the 2021 AMC. And there does seem to be a bit of market euphoria.

So what are you saying? What are you paying attention to? So there are two different segments of the market. One is retail investors front-ran institutions who got scared into the turtle shell due to tariffs, and they remain off sides underowning risk. That's one. Second, you've got earnings that are exceeding expectations. Strong year-of-year earnings growth, low double-digit EPS growth, which is strong.

80% of companies are beating earnings. Third, inequities absolutely see animal spirits. So the factors that are doing the best inequities in the last three months, one is like the short interest factor. These are terrible businesses that are highly levered, often small caps, that have low liquidity, and they are rallying strong. And they're bad businesses too. It could be like a Macy's, for example. These are businesses that know in disputes are bad businesses.

They're rallying also, creating a short squeeze. But on the other side of that, you also have businesses like Robin Hood and Coinbase and digital assets and others that have done really well. So, yeah, the animal spirits are here. They're, you know, and you see in the miners, the digital asset space, Bitcoin, Ethereum, and Solana. So I would say the animal spirits are absolutely there. In fact, because of the greater volatility and action in the public equities market, you've seen a movement from digital asset interest to the public equity market, right?

The IPO season's back. There have been 150 IPOs year to date. There have been about 60s fax year to date. Fun fact, a big chunk of those SPACs are around these these facts for Ethereum Treasury Coes. I do think we're seeing some fatigue around that. You're seeing that in recent price performance, not in Ethereum. They all have to buy Ethereum. So I think the idea of front running that group of buyers that are business plan committed

to Ethereum makes sense. So I would agree. And you saw me not in my head with, I think, virtually everything Jake was saying. And I also think the point Jake was raising is that the pairwise correlations in these markets are declining. So what was happening is that around Terra Formageddon, Liberation Day, there was one big beta trade, everything up or down together. Now you're seeing more separation. So it's just an empirical fact now that you, if you look at a security, that what's called the, idiosyncratic price return matters more than, you know, other considerations. Like look at American Eagle, you know, Sydney became the spokesperson for this thing. This thing became like a meme stock overnight. That's security slug. That's idiosyncratic price return.

It's not about the tide or theme that it's a part of. You know, this week, notably, we have a lot of macro news, non-farm payrolls on Friday, PCE on Wednesday the Fed's preferred inflation gauge. two big reports and then third we have a slew of tech earnings and i expect that on the fundamentals of business they'll do they'll do well uh that includes meta apple microsoft and amazon not sure about apple but we'll see what amazon does with tariffs but overall if you look at how google reported recently with top line and bottom line double-digit earnings growth and 30 30% plus cloud growth, you can see that the AI theme as well.

And they are a good predictor of how these other MAC 7 companies will report. Yeah, I'm really interested. One quick one, Rahman and Kowal, and I want to come to you for your take. But, and we see some of these trade deals, like 15% Japan, 15% Europe, 10% UK. I mean, and Trump has sort of, I think, pulled to wool over a lot of people's eyes. And we're seeing some of that fall in the EU. particular saying, well, at least it's not 30, it's 15. But 15 is still historically quite high for the world's largest trading pair or I guess trading partners. When do we see or are we

going to see that reflected, maybe we won't see it reflected in this quarter's earnings, but at some point prices are going to go up. And I know in some sectors, they already are. is like, are we going to see that or when might some of that permeate through markets? I think you sort of started to see a little bit of that in the sort of, you could saw the very short, arguably medium term, like inflation expectations, they have been ticking higher. But if you look at anything like a little bit further out, sort of your five, sevens, tens, like all of those inflation swaps are fairly well anchored still. And I guess it's weird still saying that, okay, around 3% is,

is now sort of part anchored, but that's the market we are now in. And obviously, the target two is now probably going to be that little bit higher. So until that longer end really starts sort of coming off, then I think it's more the short-term impact that the market is probably looking at at the moment. If that then turns into a longer-term de-anchoring of those inflation expectations, I think that's probably when people might look to panic again. But as you said, I mean, like these, yeah, you're looking at now like 15 to 20 percent. I mean, there was a headline out today that Trump had said that maybe the global tariff rate is probably going to be 15 to 20, which the expectations post-liberation day were the other end of the spectrum. They were so badly anchored for the market that it could only really get better. And what he has obviously done, whether he's done it, how people wanted him to do it or people could debate for years, whether he did it the right or the wrong way.

But ultimately what he's probably done is that has created some tariff revenue, not saying it's not going to leave to price pressures, but he's negotiated renegotiated trade deals and the market is pinning all time highs. So there is an element of that, but I think a lot of the time, probably these short-term impacts probably get sensationalized and markets overreacts, then arguably come back to the middle, which I think it's probably fairly well priced at the moment, unless we get another turn up in, I guess, the metrics as we, as, as companies start. to really have to increase prices, but I don't know, ultimately, if we're going to see that imminently. Okay. Kat Kalan, sorry for making you wait so long. No, it's okay. I want you to dive in here and tell us, feel free to respond to whatever we've been

discussing, but in particular, I'd love to know, like, what you're seeing in Sykedom. Well, I'm the research guy, so I see everything, right? So as in what goes on in the markets, like I track not so much what, you know, a relatively small startup bank. that's currently but really what we see in the markets and there's so much going on around all the issues that you have already raised

for example what Jake mentioned around Ethereum's turn around and the market looking at fundamentals more for example Ethereum's revenues have massively turned around after Pectra. They were trailing 1 million a week for a while and jumped to 5 million a week actually even 10 million last week and a bit pulled back.

So it's supported by real changes. It's also, of course, two years or two and a half years of underperformance primed it. But then, of course, the Clarity Act and Stable Coins, and now it's seen as the primary beneficiary. These are very real developments, you know, beyond the narrative. but the narrative support is definitely also there. And then the question when the Bitcoin dominance dropped so sharply last week, right? And also Ethereum started clearly strongly outperforming Bitcoin.

The inflows also into the ETFs is this now, is the old season here? Is this the, well, it's not really yet technically, but is this the opening size? And is this where we're going next? And I think there are some very interesting questions around that because the market structure has changed quite a lot. The fact that a lot of these treasury companies, certainly the ones buying Bitcoin, have taken the Bitcoin out of the market and it's stopped there. That's not going to rotate like in previous cycles, right?

You made money on Bitcoin. Then you rotate your Bitcoin into altcoins to make the next, you know, 2x, 3x, x, 5x. That's not going to happen with all the Bitcoin that the treasury companies bought. it's also not really going to happen with the ETFs. Certainly the institutional buyers who, you know, solar and wealth and so on, who bought into the Bitcoin ETFs and also the Ethereum ones, they're not going to sell it and go buy spot sui or whatever, Fart coin.

So this stands in the way of a traditional outseason. What is, I think, potentially helping the old season is three things. One is that these treasury companies are spilling that into the altcoins. So they're actually bringing demand from equity investors or convertible bond investors or wherever they sell it. And then they translate that into demand. And these are barely, even for Solana, it had quite a big impact when one of the big treasury companies immediately the price pops because the market caps are smaller. And as we go down hyperliquid and blah, blah, blah, treasury companies, then this can have quite a big price impact. And sort of, you know, that's our old season.

potentially. The other thing is that this cycle has really not been retail driven at all. For whatever reason, it was all about Bitcoin and maybe 100,000 is too expensive for retail. I mean, obviously, they can buy any portion of it, but maybe psychological, maybe it's too institutional. And really, if you look at, for example, Google Trends, the search for Bitcoin is just really not, not much. There's not much of that going on. But what happened very recently is that the search for Google Trends search for altcoins just went straight up vertically.

So that maybe suggests that retail who set out the Bitcoin rally maybe says, okay, now it's our turn. And, you know, now it's starting to be about the alts. And now we're ready to, we're ready to get engaged. And then, of course, the third point is the record. regulation or legislation, rather the Clarity Act and so on, which can really shift the fundamentals for altcoins, you know, make it easier to innovate and to have proper tokenomic structures and so on without getting sued.

Rahma, now you want to jump in and respond. Yeah, I'll lead off with the topic of tariffs. If you can share my screen here, you asked about like, where are we going to see the impact of tariffs? This is Costco. Costco has a lot of imports from China. Now, mind you, Costco had a 50 times PE ratio is incredible. overvalued. This was a safe haven trade during tariff, McGettan, it's melting down. But they're,

you know, they and Walmart reported, indicated, management indicated that they're starting to see the impact of tariffs. And you look at like, say, Dollar General is starting to show weakness. These are all importers. GM major auto manufacturer, of course, they reported last week, right, you see this big red bar here. This is their earnings report. And so what happened is they announced reduced margins from these tariffs. So tariffs, again, are a tax on American importers. It's not a, we're not taxing Japan. We're not taxing South Korea.

This whole thing is Kabuki theater. So notably, though, it recovered very quickly as if nothing ever happened. So markets are looking forward. Markets are looking past tariffs. You can even see that in other companies like coals. These are garbage companies, just to be clear. They're getting disintermediated. Their earnings are declining, but it doesn't matter.

It doesn't matter. These are rallying. I mentioned earlier that high short interest is rallying. I prefer other businesses like Abercrombie and Fitch. These are higher quality. They have earnings growth. They're cheaper as well. These guys import from China too, but it doesn't matter.

Tariffs are priced in. So the mistake people are making is that they're not being dynamic with their analysis. They're saying, tariffs, bad, risk off. No, no, no. Terrorist bad, yes. Risk priced in. And people are off sides. Jake, I know you want to just quickly touch on tariffs one more time before we move on.

So go ahead. I think that was me. Oh, I'm sorry, Catalan. I'm sorry. Yeah, no, I think that was me. And I just wanted to make the point what bothers me about the tariffs. I completely agree with what Iran said. and what you guys said and how the market is priced in worse,

and then since then the news is better and so on and so forth. And also that there's got to be inflationary pressures for sure. Importers ate some of it. Maybe we're just waiting to see how it's going to pan out. Eventually it has to be passed some of it onto the consumer for sure and so on and so forth, but it's probably not going to be dramatic in terms of the impact. on inflation, but what bothers me about tariffs is that it's not a coherent policy. If it is a re-industrialization, you need a policy package that would look very, very different than this sort

of haphazard, you know, cowboy negotiating. It would have to look at infrastructure, education, trained workforce, all of these kinds of things that have been problematic with, you know, the TSNC, Arizona, and so on it's not, it's not, it's not. It's, it. you need a coherent policy package and also to think through the supply chains. So where you disrupt the supply chains, then can they be replaced? Are you consulting with the companies affected? And, you know, none of this happened. Companies were court of guard.

And, you know, it seems to me that, and that is on evidence of, you know, what Trump and Vassant have been saying, is that the objectives with the terrorists were, to a great extent geopolitical. You know, we see now they're threatening 100% tariffs if you trade with Russia, if you don't do whatever with the Bolsonaro trial in Brazil, you get 50% or you have to do

with Bolsonaro what we tell you to do with Bolsonaro, these kinds of things. These are, it almost blurs into sanctions. Like, suddenly, what is the difference between tariffs and sanctions? And also around liberation, they were afterwards, there were these statements from the administration

that they actually wanted countries to agree to isolate China economically. So, you know, we slap massive tariffs on you, but if you agree to our demands, then the tariffs will go away or come way down. And when the objectives are not primarily economic, then they don't work actually very well for the economy at the end of the day. And nothing looks too bad and it's fine. And right now there's a lot of liquidity and the markets looking through it and that's fine. And it's, I think, going to continue to do that.

But when we look further ahead, I'm sort of concerned that economically, this is not a coherent policy package and it's not really going to work well for the economy in the medium term. Yeah, I think Lula and Brazil would have a lot of questions. It's right determining the difference between tariffs and sanctions, given the 50% thread ostensibly for political reasons. Right, right, yeah. Yeah, and you know, so the budget, like sort of raising money for the budget, I'm sure that's

a secondary objective. and it's good optics. Certainly there is income from the tariffs and in the context of the big, beautiful bill. It's very good to show that there is this offsetting income coming in. But I mean in the context of, you know, debt racing towards 40 trillion sewer or something like that, it's a drop in the ocean, right?

That's interesting. So I want to talk about crypto treasuries for a little bit. I mean, we've had some new big announcements since we did the show last week. A big one focused on hike, another one focused on suite. But I think the most interesting news that I saw was micro-strategy inventing yet another form of preferred stock. I think it was what upraised to upsized to $2.5 billion stretch, which was sort of like a novel equity class that's designed to sort of maintain price parity and pay like 9% to 10% dividend. And that was really kind of interesting to me for a couple of reasons.

I mean, one, I'm wondering that I'm very curious how he's going to keep paying that because the operating business of micro strategy is not able to generate enough money, so he's going to have to keep raising it or, I guess, theoretically, borrow against their sell off some Bitcoin. I'm curious what you guys think about that. And Jake, I don't know if you've seen any demand for it from on your desk, but if you have it, I'd love to talk about that. And then two, there was an interesting article in the FT.

I think he came out this morning about, sailor's endgame and how maybe this is all part of a bigger plan to move away from having convertible debt on the cap table so that those threats of liquidation never have to ever appear. And I'm curious if that, is that going to be a trend here? I mean, convertible debt obviously is a very useful tool when you can borrow money at zero percent interest rates and then hopefully it pays off those options for money for investors a couple years down the line, but they do represent a liability that traditional equity races do not have. So, Jake, why don't we go to you first? But I'm curious, and, Rahm, I know this is something

you follow very closely as well. I'm curious what you guys think about this new preferred share class and more broadly, like how we might think about the different components that, how we might think of a cap table. Yeah, I think, like, ultimately what we've seen, like, we saw this, We've seen this in every sort of, I don't want to use the B word of bubble, but I mean, we have seen this happening in different parts of the market before. And things don't really change too much. They just like come up every few years. Things happen. And ultimately at some point, you have to get more and more engineered with how they're approaching it, which I guess initially, if you used to do simple shares for Bitcoin, is fairly easy to understand for everyone.

and then you're putting all these different pockets of sort of programs out because now you have to differentiate because a lot of other people in the market to do it and the demand still has to be there. So ultimately, yeah, you're right. I mean, like at the end game here has to be that you are moving all your debt off the balance sheet because otherwise at some point if there is a big drawdown and we all know that we're trading an extremely long tail, highly volatile asset at the end of the day. no matter how much we think the volatility is compressing over time, which it is,

but it still doesn't remove those complete tail risks, and therefore there has to be some thought about that. Really where we're seeing the demand for, and I think the main, there's multiple ways that these products are really, I guess, changing the microstructure of the market. I think the main one where we see it on the demand side is demand for sort of cover calls and call overriding. If you look at, and this I guess is not just from these sort of treasuries.

This is also from the growth of like the ETF businesses as well. And I think if you look at Bitcoin and the actual total supply of even available, not just mine, there's about sort of 11% of that supply already sits in corporate treasuries or ETFs. And that capital is not just going to sit there and be nonproductive. Obviously there's no native yield on Bitcoin. So that causes massive demand for call overriding. And that's been a large shift in the market microstructure based on how these like treasuries are now operating. And that's definitely what we see on the OTC side.

And I guess as people become more institutionalized, I think that it's going to have other spillover effects in sort of the options, the sort of vol service. But yeah, there's a lot of different changes on the demand side. We don't see it directly for the obviously underlying products. We trade the underlying, but obviously we're working with numerous sort of corporate treasuries on, I guess, the acquisition, whether that's sort of directly or through agencies that we're sort of L-P-ing into. But yeah, it's definitely that sort of all-surface, vol-side that we're seeing the real shifts in sort of market structure almost coming from.

Yeah, look, I think there's way too many of these treasuries. I think there is fatigue. People cannot focus. When people can't focus, then you start to see deflation and the asset prices of those treasuries and that's what we're seeing now. There's only one Michael Saylor. And what he's done with micro strategy is very clever. He's built a capital market around it. I kind of liken it to how sushi swap tried to do a vampire attack on uniswap and draw liquidity and do a copycat. You've seen a lot of those happen now, but uniswap has held up far better than sushi swap.

There's Coke. That's number one. There's Pepsi. There's number two. Then there's all the rest or forget about it. That's how this will likely play out for each protocol. You have a leader, you have a number two that's differentiated in some way, and you'll have forget about them. And the forget about them is we'll trade at a discount N.V, and they'll get acquired with the others, they'll be consolidating and rolled up. A lot of these treasuries are also a way to create exit liquidity for people that have a lot of tokens, and they can lift it into a public capital market and they can do a big sale en masse extraordinary. It's like a billion dollars of an otherwise illiquid token at that size in the public

market's kind of amazing. So when you analyze them, you have to ask how much incremental new dry powder are they bringing to purchase spot? That's very critical. And what are their lockups? are they committed or do they have the ability to sell shares quickly when you underwrite these? I do think that one of the beneficiaries here is just Ethereum because you have so many of these treasuries that they have to go buy Ethereum.

That is their stated business plan and they still have more to allocate. That's one. On the all coin side, you know, what you have now with a new SEC chair who's embracing tokenization and with the passing of the Genius Act and the Clarity Act to come is you need all these all-coin projects to refactor their economics. They need the token economics that you had of prior years was a complicated dance and maneuvering of protocols trying to establish themselves as commodities so they couldn't be regulated securities. So their token values were not linked to the value creation of the teams. Now we have token economics frameworks that are coming back. So what they need to do is refactor their token and establish a linkage between the token and to the protocol.

Set another way, we need securities. We need tokenized securities for those projects that are generating revenue, which is the right way to, advance the ball forward. Not everything needs to be security, like commodities like Ether, don't, Bitcoin doesn't either. But these protocols that are in the business of generating revenue for some service, they really are securities. And they did apply a new framework that rewards the token through some mechanism based on the service it provides. And, you know, the regulation is so important here because the problem with being classed security is not that you're classed security. Like, you know, you can be called anything.

and technically it is really generating revenue and should pass it onto the token holders, which is very similar to what the company does. The problem is that because private companies are opaque, the disclosure requirements are very onerous because they have to be to make sure that there is no insider trading and the market has the right information and everybody has the same information at the same time.

And because of that compliance and basically complying with all, that is actually very costly and onerous. And these little projects, it would kill the projects to have to comply with that. But it's not necessary either because crypto is completely transparent. So setting rules that provide the same kinds of information that people would need to make informed decisions and level playing field and so on, you can actually create this path for compliance for crypto projects that are feasible to comply with. And you still achieve. the same thing. The problem is just when it has to be that what private companies need. I agree in disagree. So first off, I agree you need a disclosure framework, you need a compliance framework.

Part of it is no one knows what the heck the framework is because the SEC under Chair Gensler failed to step up to the plate and codify disclosure requirements. That they got to do that now. That's one. I don't, you know, the requirements for an S1 filing, The S-1 is the registration statement you make when you offer a security to the public are indeed onerous. What we need is something in the middle that's suited to internet capital markets. And I think that's a big theme. I see Tolly talking about that and Kyle on the Sala ecosystem. I don't see many other people talking about that.

I see Andrew Keyes talking about how Ether is a way to access computation. I think those are the right directions. We need to advance the ball forward on beyond stable cards. I think internet capital markets are the logical evolution of these networks. Yeah. And, you know, Paul Atkins is actually talking about it, right? Like he's using these words that we want to provide feasible pass to compliance and so on. So it's looking promising.

It's just not fully there. yet. Here's a question I've been getting, and I want to post it to the group as well. Right now, these crypto trade companies are launching, and the ones that launched successfully, I mean, their premiums can drop up five, ten, sometimes higher X, at least until like initial liquidations and sale walls, et cetera. And there's always a fear among retail that if I'm not in the smart money, then they're going to end up being the exit liquidity for early investors. But there's always been another way to get leveraged for these assets. assets, either through registered ETFs that, like, do 2x or 3x Bitcoin or Ethereum or Metro

Strategy or whatever or Perps overseas. And those types of products are, I mean, they're designed to mimic good or bad how the underlying asset does. And you don't have to worry about shifting premiums or discounts or worry about whether or not a company that raised $2 billion to buy Bitcoin that has never led a public company before. with leadership that's never led a public company before, are they going to be, are they going to be as dive-in-handed as Michael Saylor spent? And I know that the answer to that question

is much more complicated than the way I just posed it, because there's hidden costs in ETS and rollover costs and all sorts of other things, and they don't always necessarily meet their performance goals. But just given where some of these premiums are and the expectation that many of them are going to fall somewhere between one and two, perhaps closer to one than to two, is it worth investors taking another look at some of these

leveraged ETFs regulated or unregulated as a way to sort of get some of that extra leverage without having to take on the risk of the unknown with some of these companies that are raising gargantuan sums? I would think so at this point, right? I think that the premium on these things are too high. I think even the premium on strategy at 80% is too high. If you look at where they can get that additional Bitcoin per share growth from, it only has defined sources, right? As long as they sell, for example, volatility out of the money, call options through the convertibles, that's a source of that.

Leverage is a source of that, but obviously that's a double-ed sword because anything that's straight debt has to be repaid or this perpetual prefers the coupons in perpetuity, they would depress the Bitcoin per share. right every time they they pay the coupon and maybe it's not that much because the leverage is not very high for for strategy at the moment but still the pressure is is a downward pressure and the rest is a ponzi any premium above that of course if if the premium is too high you can take that premium and buy more shares and you increase the the bitcoin pressure from that but you need the next guy to pay that premium or or higher and this this strategy is is not infinite, even though Michael Saylor says it's an infinite money glitch, it's not infinite. At the very least, once you bought 21 million Bitcoin, it's over.

But it's over much, right? But it's over much sooner than that, right? Because the demand, there's a demand arbitrage going on. It's eventually going to run out, it's saturate too many of these. It's hundreds of these companies that are 284 on the last can. And then what? So the question is at that point, when you can't raise the next, the next debt or sell equity at the premium, then basically it has to at least go to flat to an AV.

When Jim Chano's covers, then it's over. Yeah, and probably to discount, right? So if I were looking at these now, I would be concerned where the premium on these things will go now, that the market is so saturated. And, you know, if you look at Michael Saylor or not Michael Saylor, but strategy owning, already 600K or thereabouts, relative to Bitcoin exchange balances of 2 million, and his target is to go to 1 million.

You know, where do you go from there? It's what's the end game? Eventually, eventually he cannot keep doing, none of them can keep doing it beyond a certain point. And then what? You know, then it's a scale, right? Yeah, yeah, I mean, I think we all, I mean, that makes sense for everyone on the call and everyone listening, I'm sure.

But I'm just thinking right now, too, because I remember, I mean, this was right before in early 2024, or right after the Bickland ETFs launched, like what was going to be the future of Bickland futures? One of my analysts at Forbes when I was still there, actually wrote a story. And we talked to the guys at pro shares and I think volatility shares,

et cetera, like what is the outlook for some of these products? And I think it was more those products would be sort of relegated, I don't know if that's quite the word word to being like a traded product. Like you would say ROM as opposed to like a buy and hold product, which is what the spot ones are. But I, and I'm not quite sure where crypto treasury companies fit into that. I mean, I'm sure you guys have a pretty good idea. Maybe, maybe somewhere in the middle.

But it just seems like in certain ways it could be cheaper, especially like if the SEC starts approving regulated derivatives and ETFs for assets that are beyond like Bitcoin, XRP, Solana, and ETH. Maybe it's a business opportunity for other people to look into, to sort of like tap into that enthusiasm without necessarily having. to go to the trouble of raising all that money right up right up front and it's perhaps a little, I guess one could argue maybe it's a little bit fairer for investors? I don't know. What do you think, Ron or Jake? Look, I think there's too many of these treasuries that are launching and there's a

novelty effect. If you're the first out, you get a bump and the next one gets less of a bump. And again, you've got analyze the incentives of the people that are holding it and what are their objectives? What are they permitted to do as far as their ability to sell? right? Is there incremental cash that can deploy? You know, what the treasuries would say is that they are vehicles designed to increase, say, Bitcoin per unit share or Ethereum per unit share over time. That is what they're designed to do. So even though you're buying at a premium NAV, what you're buying as a vehicle will accumulate that. So the analysis is between what's the premium to spot that you should pay to acquire an asset that's going to compound the underlying

spot. The analogy to this, which Charlie Munger and Warren Buffett would hate, is that these are like Berkshire Hathaway companies focused on the spot market for Bitcoin, Ethereum, or Salon. It's permanent capital, just like Berkshire Hathaway's permanent capital. They're not going to solve that underline spot. They're going to find creative ways to accumulate that spot asset using capital markets machinery or in the case where they trade a discounted and AV, use cash flow, save from staking to go buy back their asset. But overall, though, like, I would agree, like, I'm more on the cynical side of things. I shared that last Monday as well. It's like, when you have a proliferation of financial products, you know, be careful about Wall Street selling,

right? Go buy what Wall Street sells like one year later, you know. That's not to say that certain products aren't there, are out there or not interesting. Those treasuries that can create a source of incremental demand because it's hard to access the spot, there could be something there. Maybe hyperliquid fits into that bucket. I haven't looked at it, by the way. I'm not able to say that. But so far, they're one of a kind. It's hard to substitute for that demand.

And it opens up a new market of access. Maybe that has a different underwrite than these other treasuries. Yeah. I think like I probably share a similar, I guess, cynical view there with yourself. I mean, ultimately, I think like it just what you're ultimately doing is, no matter what asset you buy, you're like without the whole market going up, without Bitcoin without Ethereum going up, those assets can't do well because that's the demandist doesn't going to be there. Like we are still ultimately a risk asset. So if you've got to get

the direction right of the majors, you don't have to get the direction right of the old. You then have to understand which of those treasury companies. And it's almost akin to like the, there's a lot of these zombie mining companies listed on like the TSX, right, that have gone out. They've raised a load of money because zinc or another esoteric commodity was really hot. Maybe it was a hobol, like maybe there was like a few months where all of these companies listed because they found a deposit. And there then became so many of them and ultimately you'd have done way better if you just bought the underlying commodity.

And that is what you should have bought. And then obviously hindsight is great. But yeah, I mean, look, like anything that sort of is spun up and as soon as you get, I mean, we've seen, we see a lot of these deals and like the SPAC craze back post-COVID when we had that dual sort of bazooka stimulus monetary policy. Like I traded all of that when we were training single stocks. And I mean, the sponsors got worse and worse as that craze sort of went on. The first few months, which I think we are still at the sort of relatively early stage here.

I'm not saying like we're at the end of this. But as the sponsors get worse down the line, that's when I think there has to be a very, very, very different take than perhaps is at the moment. I think as long as people go into it with their eyes very much open and like that, especially in a few months time, then ultimately like it could be a trade. But yeah, I think it's always going to be in crypto and the core fundamentals of this asset class is you sort of self-custody. I know it's going to change. But I mean, I'm very much in that camp and I don't think there's any any need to super really, really overcomplicate this. If there was ever a moment that sort of catalyzed all this right now, I got to go to the bell ringing ceremony for SRM, which I guess now, SRM Entertainment, which is now called TRON, or listed at TRON on NASDAQ, and I got to meet Justin Sun for the first time.

Ironically, I did a big feature on him in Forbes a few months ago, but I never got to meet him face-to-face. But in certain ways, that was kind of a surreal experience. And one of the things that he said in his remarks before trading began was how it was always his dream to, I think, follow in the footsteps of like Tesla and Apple and launch a company traded on NASDAQ, which all the credit to him. But it's also kind of ironic that launched a blockchain designed to disintermediate all this. Yeah, it's like one of the big crowning achievements was. was getting to ring the bell at a traditional exchange, even though it's probably a crypto forward one. So it really kind of was an interesting sort of like juxtaposition

of all the different forces that have come together with these crypto treasury companies. Yeah. Yeah. I don't get me wrong. I mean, like I think it's absolutely amazing for the industry. Like anyone who was around when obviously FDX blew up and everyone was here through that bare market, like there was times where you thought this is, maybe this is it, maybe that was it and it's never going to happen again.

And just to see how far it come and now companies are listing, it is an incredible achievement. And I do think it's opened the market up to such a wide wind of investors. And if nothing else, it's put it on enough people's maps that arguably when they do come down and they go, okay, well, this is interesting. It's a good way to get the foot in the door and realize that to the market, there is more genuine utility behind it. So even if that is the end result of this, I do think it's overall a good thing. for the market and if nothing else it's turning it into more of this sort of institutional asset class right it's uh i think overall it's fundamentally good but equally there's also like cynical

element of it down the line that you have to say okay where where does it go from there but i think we're in a good spot at the moment i was just got to share this funny anecdote that i mentioned from the the tron thing the highlight though was he handed out little boxes with the the banana thing that he bought for $6.2 million. And so I brought her home, my four-year-old loves bananas. Like, that's all she eats. And so she gobbled it up and she told me that all bananas now have to be come in a box like this. Which I guess that's what I have to.

I save the box so I can do that. And maybe if I do this, I don't. Does a box trade at a premium 10AV versus other cardboard? It was really, really, I mean, he's lending into it. He got so much more than $6.2 million of marketing value out of that thing. And now I don't have to buy her a Hanukkah present. So a win for me. She's not asking you to tape the bananas to the war.

Every single time. She wants me to have a roll of duct tape. That's how she wants her bananas. And I goes, I can't say no to her because I'm a sucker. That's what she's going to get. But, you know, I wanted to ask the question about these treasury companies, is what's going to happen to all this Bitcoin, right? What's going to happen?

Is it going to sit there like Satoshi's million or forever? Microstructure trading flat to it or converted into an ETF or what? When you say what's going to happen, I mean, the treasure company is going to accumulate them. They're going to finance their accumulation as much as they possibly can. But that's going to come to an end. That's going to hit a wall. From my point of view, Kettle, I mean, I hope. it just sits there because the danger, I mean, the danger is going to come when they start leveraging

their balance sheet and using it creatively and tokenizing shares and someone's going to be on scrupulous about it. And then like if they, if someone's too levered up on debt, they're going to have to liquid aid and blah, blah, blah. Like, I hope, that's why I said earlier. I hope everyone is a diamond handed as Michael Say what you will about him, but he's committed to his ideology and that has a change. They're all, they're all committed. It's their business plan to be diamond handed. If they, in fact, if they did not accumulate the spot commodity, you could sue them for misrepresentation. But if you read some of those SEC filings from, I mean, you see how they say they're going to, like, use leverage. They're going to lend it out.

I mean, they're not saying they're going to be diamond-handed. Michael Saylor, I think, probably is. But others, I mean, in their announcements, they're. Lending out, you still have title to the asset. They're still, they're just earning yield in a productive manner, which is a smart strategy. They should do that. I'm not, they're a net bias. As long as it's done responsibly.

I'm sure like Genesis thought they were responsible. I'm sure there's plenty of, like I know BlockFi thought they were being responsible. Like I know Steve Ehrlich, who I used to get confused with at Voyager, like he thought he was being responsible. So that was rehypification. That was non-banked to be banks. That's what caused the blow up of 2021. This is very different than that. You know, that I don't see any evidence that that's happening current.

It's not saying that that's not happening in smaller scale. I'm sure it is somewhere. I don't see any evidence of that happening, you know, writ large. I'm always on the lookout for that. I don't see that kind of behavior yet. Not at all. It's just the question is what is the end game, right? Because eventually you can't really increase the Bitcoin per share anymore.

It hits a ceiling. Actually, it's going to start decreasing. And then what happens to the shares and what do you do? And then how do you get creative? So it's just asking, and these questions are on. answer. There is no actual answer by any of, you know, Marketer or any of these companies, how it's going to continue to be somehow profitable and worthwhile? No, consolidation. That's the end game. A lot of the miners have obviously had to go down

this route and they've rebranded. They're turning into data center businesses. They're merging. They're getting the scale. So I think I do agree 100%. I think that's probably where the market goes. but we're obviously, I think we're away from that, but it's definitely one of those things that people will start to look at when you break it down under the hood. But, you know, when you say consolidation, it's already the fact that a third and targeting half of the liquid supply of Bitcoin is owned by a small US company,

that makes Bitcoin inappropriate for any central bank to hold as a digital gold central bank reserve asset. it's already a problem for large corporations like Microsoft, Amazon, Meta, McDonald's who all voted this down to buy it and put it on the balance sheet because a small company controls so much of the supply. So it's actually closing off very exciting, much more promising use cases for Bitcoin. And if there's even more consolidation, then that's even more the case. So we need to take a quick break and then finish up with a couple more topics. But I think the other, I mean, I think, Ram to what you said, I mean, I'm not seeing evidence of this either.

But I can just tell you that this is my experience is that people are going to push the envelope. And I mean, it's starting from like prime brokers are not accepting like crypto treasury stocks as as safe collateral yet. It's actually funny. I wrote a story on this a few months ago. And I said that at that point in time, they weren't even accepting like Ibit shares as collateral. And then I think actually like a week after I wrote that, one of the big banks, maybe it was JPM or Goldman, one of them started taking those shares as collateral. And I just at some point it's going to happen because it's in their business plans. Yeah, you're right.

It'll happen at some point, not now, you know. No. When Genesis and DCG were in the shenanigans and BlockFi and Celsius and I was a critic on Twitter about all of them to a name. I don't see that now, though. Yeah. It's a clear system now. Yeah. But the other thing, too, I mean, just play devil's advocate as well is right now markets are good.

I mean, if there is wrongdoing, it's going to be harder to see. I mean, the paraphrase profit again, like you find out who's swimming with no clothes once the tide goes out. And right now, it's high tide. So just a quick break. And then we have a few more topics to discuss. Hands up, everyone. We've got exciting news. Fits and Biffs, our Macro Meets Crypto show, is officially spinning off into its own podcast.

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CIO memo. Carefully consider the extreme risks associated with crypto before investing. I think at this point, we need to talk about the very interesting construction tour that Jerome Powell and Donald Trump took last week, looking at the Fed's, I guess, multi-billion dollar renovation. I think I read somewhere maybe one of you can correct me. It's the first time that the president went to visit the Fed since Bill Clinton. So it's obviously decades since that's true.

And really, it was an awkward situation made for late night comedy, but it also laid bare a really critical juncture in terms of Fed independent. I mean, we're going to have another rate decision on Wednesday. It's going to come out a few hours after this show is streamed on all of our podcast channels. Everyone's expecting that Fed's going to hold rate steady at least one more month to see what happens, get a few more months of data before the September meeting. But we could see two dissents, which would be the first time that happened since 1993. And it also comes with a really interesting, and all the pivot is the right word, but treasury options in the way that Bessent and I guess Trump are trying to work them by kind of like front loading the front end of the yield curve to avoid the long term more expensive debt, but to hope it goes down as rates decrease.

I mean, that's also creating, I know, some interesting questions or decisions to be made in the treasury market. So there's a lot to dissect here. Ron, why don't you go first? It's been an incredible week between the Powell Trump visit and Hunter Biden explaining how the subtle differences between cocaine and crack and how cocaine is actually safer than alcohol. I thought this was like AI generated. I sent it to several people. By the way, you guys have heard the concept of cognitive dissonance, right? It's like there's like a tension that is creating your mind when you see something.

something that doesn't correspond to your mental model of the world. Like, I felt, I'm like, oh, this is, this is, I'm experiencing, this can't be happening. This is kind of, that's what I felt when I saw both of those. The Powell Trump thing, I think it's just reality TV. You know, when Trump ejected Zelensky from the White House, he made this one statement. The end, he said, that will make for great television. Okay. That stuck with that.

That will make for great television. This is Trump's MO. His strategy to disintermediate the media, which he feels unfairly covering him, I think he's right actually, a large part of that, is to own the attention market. And social media is a part of that. The other part is that he's got this really uncomfortable monkey on his back called Epstein. This is hilarious.

Another thing too bad. That was the third thing last week, where he went from, I'm going to release files on Epstein and UAP and I know what's flying over at Bedminster and why don't they share when I get in there I'll share everything to now this one to like, oh, it's fake. It's fake. There's some really hilarious memes flowing out there. We should share one or two on the screen. But overall, I think this is like a nothing burger. This doesn't really mean anything. It's just a strategy for Trump to continue to focus on topics that he thinks are in his best interest and distract from uncomfortable topics that are also starting to fracture his mega base.

So you think it's much ado about nothing? I mean, Catalan, what are you, I mean, from across the pond, what are you saying? Yeah, I mean, I think it's been going on for a while. I don't disagree with what Ram said, but this criticism of Powell demanding rate cuts that's been going on for a while. And it sounds, it's very hard to understand why this is happening. right? The market has a lot of faith in Powell, the dollar sells of one sell off every time, you know, it's kind of threatened. He is threatened to be replaced and actually cutting rates in the face of impending inflationary pressures, even if it's not, maybe not going to be that much. But we still don't really know, even these trade deals, their frameworks, there's a lot of uncertainty. There's a lot of like up to this amount. of investment and this and that.

So how everything will work at, we don't even know what actually the tariffs will be, never mind what their impact will be. So what Powell is doing is really prudent and kind of the right thing to do. And pressurizing him to cut rates, it would just break the bond market. It would just lead to,

like even last September, when they cut by 50 instead of 25 bonds sold off massively, right? And the bond market then wasn't in such a bad shape to start with. Now it's already the 30 teetering around the 5% above it, below it, above it below it, it really, it really doesn't make sense. It doesn't make sense. And there's two possible theories. And one is that's been around on Twitter that basically this sort of push, you know,

what you mentioned as well, that push the average maturity much, much, much shorter. And then roll it, then get a new fat chair and roll it into much cheaper. But like obviously the implications of that. would be over, you know, over any, any sort of, you know, it's an immediate relief for the budget, but after that the problem. And the other is, you know, a theory of mine. And, you know, I don't know what you guys think of it, but with a lot of the policies sort of, it's fine, but medium term, they're not really rebuilding America and they're not, they're not really going in good direction. And maybe Pall is lined up as the scapegoat. You know, he's kind of being blamed. So when things,

go wrong. It's like, well, it's because of him. He didn't cut rates and that's why we have these problems. So, you know, when the Fed building renovation thing went on, I kind of thought it's going in that direction, you know, trying to really scapegoat him. Yeah, I think that's a great point. I mean, like, Trump loves a good fight and taking on establishments that are perceived as out of touch or elite, whether it's the Fed or Harvard, makes sense. And it's a fight. And it's a fight. where he's got an advantage because he's got the microphone and everyone else is constrained. So I think there's something to that. I'd say the other part of it is that there's a comment that it's made over the weekend

where he said the US experiencing higher productivity rates, much like the late 90s due to the rise of the internet. And in that environment, Alan Greenspan had rates lower for a longer. Therefore, the US experiencing this kind of AI product. could also keep rates lower for longer. First time I heard that argument from Besson, really anyone, I thought it was a novel argument. I agree with you. You actually don't need to cut rates now.

The economy is more than fine. Save the ammo. Retirees are taking their table income and spending on travel and leisure stocks, which are up 20 or 30 percent in the last two months. But the other side of it is this, like back into tariffs is the parties paying those tariff costs are small businesses. They're the ones on Shopify, importing from China. They're importing hockey sticks or uniforms or small merchandise products. Those are the folks that are feeling the pain.

They would also benefit from rate cuts, that population. They benefit break us because these smaller business and small caps have more debt on their balance sheet. So it helps them. The problem is this, though, there's a mismatch in who it helps versus who's hurt by tariffs. You're not going to get a construction loan and at the same time be importing from China, even though they're both part of this base. So it's a band-aid, it's an imperfect band-aid for an issue caused from this tariff policy. Yeah, and also the business loans are often longer maturity.

So if you manage the whole monetary policy in a way that bonds sell off, then actually you hurt the borrowers, right? I mean, depends what, you know, if it's kind of shorter one year, two year loans or versus, you know, longer. But for business loans, it could actually be counterproductive. I sort of agree with a lot of those points. My mind being view on this. And I mean, we've seen him do this through his last presidency. We've seen him do it in the buildup to this.

We've seen him do it all the way through. But he'll drip-freeed information out, see how things react. And then he'll make a decision. And the second that he put that, there was those headlines that leaked. or however we say the other day, about, okay, he's thinking about firing Powell and the market dropped. It was rolled back very, very quickly. And I think really that just he probably saw that and think, okay, well, we're not ready for that. But what I do think is there is an element of him hedging himself in terms of, okay, in the next election.

And equally, you have to keep people who are in these supposedly like tariff impacting industries, What of those people have been for years? Because up until now that monetary policy was the real drive. People just associate economic stimulus with monetary policy. What we are actually in, I think, is probably more fiscal, but regardless of what I think about it, the narrative, the riding narrative is people still monetary policy and loose monetary policy with stimulus. If the stimulus, whoever's in the government, is likely to win the next election.

And that is, I think, what's his main driver is. driver is and this just to yeah he can test the market if obviously Powell's going to leave in May but now it's very very clear that when he does start picking the next frontrunner and we the market do it is it's very easy to put and just move the rent about what Powell says so I think he's almost win where okay if if if the tariff policy implodes and Powell is still in office and he's not cut rates, then it can be Powell's fault. On the flip side, obviously, if Powell doesn't cut rates, then he can probably just install a shadow chair and he can play with rates that way. So either way, it's sort of like, he probably has control. And at the end of the day, if you go

and sort of listen to the game master, like he wants, he very clearly wants lower rates and he wants to sort of drive that. I do believe that it probably does cause inflation because if you're putting tax bills through, you're obviously last week as well said he's going to give people and more stimulus checks to low-income households, at the same time, he's doing a lower rate. It is this sort of, where does that money go? And it's going to be difficult to see that in the medium term, as Kathleen said, that it doesn't sort of tick higher. And that's probably where the impact will be.

Yeah, I actually, I feel badly for, for Powell in a way, because he's in such a lose-lose situation at this point. It actually makes me think, you guys have seen the movie Oppenheimer, I assume. there was one line when it was near the end of the movie where I um Oppenheimer uh Killing Murphy's character was was arguing with uh Iron Man what's the actor's name uh Robert Downey Jr's character about whether or not to um about basically whether or not you should work towards disarmament and Oppenheimer felt at um like nuclear weapons should sort of be globally managed and and down a junior character felt otherwise and and one of uh pahemar's

colleagues said to him when people hear you they hear a prophet when they hear the other guy they hear themselves and as a prophet you can't be wrong once and pal was already famously wrong once um anytime we say the word transitory all three of you know what we mean and i'm sure the hair is like sticks up on your back because inflation was anything but transitory during COVID. So like, and what that mean, like for the Fed, and in a way the Fed was forced into this position of kind of being a policymaker because Congress advocated that responsibility with like extreme partisanship and and just so, but at this point, like the Fed can't be wrong. And since he was wrong once, no matter what Powell says, even if they're following different

methodologies, doing the best they can, trying to follow the data, et cetera, et cetera, et cetera, someone going to hold up inflation in 2022 and say, see, you were wrong then? Why should we trust you now? And who's going to believe Powell except for sort of like Fed watchers, which are not Trump's based? So it's a really tough situation. I'm actually really relieved that we're going to start seeing some of these deals happen. I mean, I know they're almost like, I don't think framework is the right way to describe some of these deals, but at least we have an idea of what the long-term tariff rates going to be. So perhaps by the time we get to September, we'll have a little more clarity and the data that comes out of the next couple months, inflation data and PPI and all that other stuff, perhaps it can be a little more trusted to some other data. of like, I mean, the negative GDP and the Q1 was obviously an outlier because people were importing so many goods to get ahead of the tar.

Like, you can't trust that data. So I hope that we have more clarity come September. We're getting close to time, but I do one other item that caught my eye that I'd like to just throw it out to the group to see who wants to talk about. B&Y and Goldman tokenizing money market accounts. That has the potential to be huge. Rahm, I see you shaking your head. Do you want to dive in and just give a few initial thoughts? Yeah, look, I think the Genius Act is poised to transform payments and banking as we know it, right? What is digital assets? It's custody, its payments, its ability to borrow and lend and settle. And we have tokenized dollars.

What's next on that train of assets to tokenize? It's tokenized interest-bearing dollars. Those are called money market funds on chains. That's happening. We have tokenized private credit. already on chain. So, you know, I think this is a major theme that we're going to keep seeing more of. And I think it's the most promising area in digital assets.

And it's kind of a, it's a subcomponent of this banner called Internet Capital Markets. This is on the fixed income side. Jake, what are you saying? And I'm really interested, too, if you could just talk a little bit through the winter mute strategy when it comes to, I mean, tokenizing money markets. but tokenizing treasuries, I mean, obviously stable coins, tokenizing other assets. How are people going to be creative using these instruments in the future in these internet capital markets as from just mentioned? Yeah.

I mean, I think this is obviously wildly sort of public information that we're obviously, we're, I guess, LP and with the Builders BlackRock, BlackRock's buildle. So obviously that was our, I guess, like move into the sort of money market funds and ultimately a wider feeling of tokenization. I do believe in the sort of internet capital markets trend. Ultimately, like there's this big convergence of both sort of crypto and sort of traditional assets that I do think will continue. Ultimately, why I think that means for us and how it leads into our strategy is that, yes, we're going to be end up seeing a lot more demand for these products. We already are. There's obviously been, there's a few more. We have to interact with them.

as a desk that's trading them, truly more akin to the traditional environment. And that's something that we have already led into sort of general operations. It's not going to stop at these money market funds. There's obviously a lot of demand for tokenized equities. That's obviously looking for serious out. And I think as these everything comes, whether we say we're going, things are coming on chain or we're going into trad, like it's all converging into a middle ground. I think the market is going to look very, very different. And even down to sort of how we're, I guess, derivatives, what we suffer, what we take is collateral.

I think there's a big expense. Everyone is going to be sort of watching how that plays out over the next. I think that's ultimately, as we said before, like the point of the next of where people start trading. Okay. And, Catalan, what about you? Yeah, I agree. The trajectory of travel, absolutely so much commitment behind it, so much interest. from government, regulators, stratify, everyone.

So I think this, you know, let's call it the internet capital markets. I think there's a lot of intention to make it happen and it will. I'm not sure. I certainly see forecasts that predict very large volumes very soon, and I don't think that it's going to be that large, that soon. I think it's going to be, it's going to take long. for the infrastructure to be put in place widely enough that it really can be that. I think that can take five plus years for it to be really, really meaningful in size,

but that's the trajectory of travel for sure. Okay, great. So before we wrap up, Rahm, you know this, but for everyone else who, actually, Ram, it looks like you have a little bit of breaking news. Right now. Yeah. So Tom Lee's affiliated treasury company, BitMine Immersion Technologies, is down about 19% in the aftermarket, after being down 12% today on news of a registration with the SEC that permits them to issue 45 million shares of common stock.

By the way, that's about how many shares traded today. So that issuance of shares allows them to sell stock to the public. which will create dilution. So that's selling off today. I would expect other sell off this week on that news. So you're going to see some of the premium to NAV compression. Catalan talked about play out. Interesting development.

Breaking news. Here we go. Yeah. I mean, it's inevitable. I mean, I wrote a story a few weeks ago on, and Bittemey was actually the lead for that story about pipes. And basically what's going to happen from those. shares get registered and it looks like this was a separate um a separate registration yeah um for

those and they had an app the money registration a few weeks yeah yeah but they will set up good buy opportunities later this is just yeah i mentioned last monday that you know bitcoin is entering a period of negative seasonality in august and traders are going to focus on that and i don't know i'm not view that Bitcoin states above or even gets to 125k. If it does, it tax it and rolls over, then you get back into it in Q4. No one agrees with me on that view at all, by the way. I showed that view and everyone looks at me like I'm crazy, which gives you more conviction in that view.

But that actually gets back to one of the other things we were talking about before. Like, what's the point of convertible debt? Well, that's one point. You can raise a lot of money and you don't dilute right away. So you can avoid some of those big collapses. But yeah, thanks for sharing. So to wrap up, I always like, and as selfishly is a little bit more, as much for me as it is for everyone listening. I'd like to hear from you guys, either one contrarian opinion you have that you really want to get off your chest,

or if there's just some idea, Nugget thought that was kind of left on the cutting room floor that you didn't get a chance to talk about yet. Rom, to give our guests a chance to take us something, why don't you, why don't you go first? Yeah, I think it's what I said. I think Bitcoin is probably softer in the next 30 to 45 days. I think that's very contrarian. I think if there are an announcement that Trump has on Wednesday around digital assets, which is expected that it rallies and then you actually fade the news. Okay.

Carolyn, was like to you next? Yeah, you know, maybe a contrarian view is that the very bullish forecasts about how much stable coins will grow and how much use they will have in terms of retail in Western economies, in emerging markets and so on, and how much difference they're going to make to buying treasuries, I think are wildly exaggerated. And if we break it down, where the demand would come from, you know, why Western retail would ever switch, what is driving emerging markets, nothing to do with the Genius Act. They're buying tethered. They don't care about the Genius Act. So it is growing, but it's not going because of that. And it's not. So unless there is something else in that picture, for example, massive incentives to emerging market users, air dropping free stable coins to them or I don't know, helicopter money is.

You know, like, or I think that the expectation that retail all over the world is going to use stable coins and it's going to reverse the dollarization massively, and it's going to be a huge source of demand for treasuries, I think I think is wildly exaggerated. I think there's a lot of chat, obviously the current sort of Bitcoin volatility levels, especially like in the belly of the curve that maybe we're at like lower percentile really. historically and therefore that can only go high from here. I think that we probably do continue to just converge and act more like an S&P. The reason being, obviously we mentioned on one side of the coin,

this constant overwriting is more and more hits treasuries and ETFs and then you can use that as a sort of overwrite on that side. And then on the flip side there, this realized volatility in the asset continues to really collapse and a lot of that is due to this sort of buyer of last resort and people like Saylor just being in the market on the downside. So I think you have a compression in implied volatility that's not only driven by sort of the drop in realized, but also this constant overriding. And that's sort of where I would see it.

And then that naturally means that Ethereum becomes more of a trader's market until ultimately, I think the same thing probably ends up happening there as well. And for me, I don't have a contrarian opinion, but we didn't really talk about Ethereum and its 10-year anniversary, which is coming up on Wednesday on the show. This isn't quite the right. So among all of our, among the different shows under the Unchained Brants to discuss it. But I guess we'd be remiss or I would be remiss and we didn't mention it at least once here at the end. Obviously, it's a tremendous achievement.

Ethereum is 10 years old. And I mean, it really, it set out with a very bold vision to create the world's computer and decentralize all different types of applications and products and use cases. and it's achieved a lot, but it's also faced a lot of, it's also faced a lot of adversity. And I know many people in the community are excited about some of the changes at the EEF and some of the key milestones that are going to come along this year on the developmental roadmap.

And I'm interested to see what's going to happen. I mean, in many ways, I think a lot of battles are still, still need to be one. I mean, decentralization versus centralization. Like, how do you scale something but keep it secure at the same time and decentralized? Like the famous trilemma, there's so many debates out there that are still being argued. So I'm excited to see what the next 10 years will come. But I know, at least for the purposes of this show, we're all thrilled with Ethereum's massive run-up in the last couple of weeks.

So if nothing else, let's keep that going. With that, thank you, Jake and Catalan for joining, as always. Thanks everybody for listening.