Unchained - Bits + Bips: Grid Congestion Is Energy’s L1 Problem. This Crypto Company Has a Solution

Episode Date: March 28, 2026

Oil above $100, Qatar's LNG infrastructure in ruins, and a 150-year-old grid buckling under AI-era demand: Sean Murray breaks down why energy has an L1 problem and how Fuse is building the crypto-native fix. --- Multichain Advisors is an emerging technology growth firm that has helped create over $50 billion in enterprise value for 80+ clients. Services include TGE support, go-to-market strategy, BD, partnerships, capital markets advisory, PR, media placements, and KOL activations. Visit https://www.multichainadv.com/ --- A $5 billion UK energy company built by Revolut alumni is about to launch a new token, and they already have an SEC no-action letter to back it up.  But the real story starts with the grid itself. European gas prices are running 50-70% above normal. Multi-billion dollar LNG facilities damaged in recent attacks could take years to repair. And a power grid designed 150 years ago is buckling under AI data centers, EVs, and renewables it was never built to handle.  Sean Murray, Fuse Energy's crypto lead, joins Steven Ehrlich to lay out why an estimated $70 billion in clean energy has been wasted because the grid can't move it, why that congestion problem mirrors crypto's own L1 scalability crisis, and how coordinating millions of smart home devices through a token-incentivized network could fix it. Host: ⁠⁠⁠⁠⁠⁠⁠⁠Steven Ehrlich, Head of Research, SharpLink Guest: ⁠⁠⁠⁠Sean Murray, Head of Special Projects & Crypto Lead, Fuse Energy — Previously part of the Revolut early team; now leading Fuse's crypto strategy and DePIN network launch for a vertically integrated energy company doing ~$500 million in annual revenue across the UK and Europe. Learn more about your ad choices. Visit megaphone.fm/adchoices

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Welcome to another episode of Bits and Bips, The Interview. My name is Steve Erlich, head of research at Sharplink, and also your host. We've got a terrific show for you today, but before we dive in, let's take a very brief break to hear from some of the sponsors who make the show possible. Multi-chain Advisors is an emerging technology growth firm that has helped create $50-plus billion in enterprise value for 80-plus clients over the past four years. They're the partner to help navigate markets. Build real traction today at multi-chain adv.com.

Quick note before we get into today's episode, Bits and Bits Now has its dedicated feed. We're spinning off from the Unchained Feed and moving to a new podcast and YouTube channel. So if you want to keep up with our weekly live streams and macro meets crypto breakdowns, make sure to subscribe to Bits and Bips directly. We won't publish there until March, but subscribe today so you can be ready for launch. Be sure to subscribe to the new feeds at Unchained Crypto.com slash Bips and Bips. All right, welcome back. like I said, we've got a really interesting and timely episode today. I have with me, Sean Murray,

the head of special projects and crypto lead at Fuse Energy, a $5 billion U.K.-based energy company, full-stack energy company that really sits at, I guess, the convergence of decentralized infrastructure, crypto, and energy. And we've been speaking for for weeks now about how crypto and macro are colliding, That's what we do on the show, in particular in relation to the volatility and energy prices. And Sean's business is being directly impacted by all of this. And they've come up with a really ingenious way to try to, I guess, mute out some of that volatility and grow a sustainable business that's largely based on renewable energy, something that we can all get behind. So welcome, Sean. Thanks, having me all, Steve.

Great to be here. So I want to just level set here. And I want to make sure that we're going to get into all those issues. But Fuse, it's a bit of a complicated company. And unlike many projects that are highlighted on the show, your origins did not start in crypto. The firm actually was created by a few early employees of Revolut. Europe's, I believe, largest or most valuable in tech startup. So they know how to grow a business.

And you've already built a pretty successful company before you even got into crypto. So just very briefly, can you please explain what Fuse does? Yeah, sure, Steve. And thanks. And understandable, we're building probably about 10 different businesses at once right now. So there's a lot going on. But in summary, we're a verticalized energy company. So it means we operate across the energy stock.

Everything from generating energy from our own generation plants like solar and wind farms that we acquire and manage, to a big in-house kind of trading operation on wholesale power markets, to then ultimately supplying, you know, homes and soon businesses with energy and billing them every month for it. And that's kind of on top of kind of an installation and an R&D unit as well that we do for kind of distributed energy devices that ultimately, you know, will be looking to launch our kind of, you know, crypto-native product into. So that's broadly what we're doing. We're doing about half a billion in revenue right now annually, mostly based in Europe in the UK, but I think to kind of expand over the next year or two to, you know, North America and a bunch of other countries.

Yeah. And I know one, I guess, big feather in your cap is a no-action letter you got from the SEC, I believe, last year. And we'll get into that and what it means for your business. But first, I really want to talk about what's happening in energy markets today. I don't have to tell anyone listening or watching that they're volatile oil is still above $100. And given, I think, some of the seesawing statements from President Trump and the U.S. and responses from the Iranians, it's very unclear what's going to happen next. How is this impacting the energy markets in Europe versus the U.S., which I believe is a little more self-reliant? And what are some of the big changes or how is this impacting your business? Yeah, a great, very obviously topical question. And the kind of differences between the UK and Europe and the U.S. are pretty stark, which, you know, you can kind of see manifest itself on the charts right now. I think one of the big things that, you know, we look at broadly is, if you think about kind of oil and gas prices, obviously they're incredibly, you know, the price of oil and gas on markets incredibly ready to the supply. And, you know, most of that comes through the Gulf and for Europe especially. And in the U.S., naturally, you know, with the kind of recent Shale revolution, the U.S. is somewhat self-sufficient, especially when it comes to gas. But I think, you know, one of the big things that we look at is when we're looking at, and how it's kind of affecting our business is that the price of oil actually doesn't really affect

the price that ultimately people pay for their energy, that homes, businesses, data centers, et cetera, pay for their energy. You know, obviously it affects what people pay at the pump, but it's more through secondary effects that oil has these knock-on effects on the kind of energy economy. And, you know, it's loosely correlated with gas, and that's typically due to, you know, it's kind of a replacement in some industrial applications. and obviously oil and gas are sourced near one another. But the main effect of oil on kind of power markets and energy markets in general is secondary

due to inflationary effects on logistics. And obviously that's been hugely impacted with the recent developments in the Middle East. And the kind of more kind of pertinent thing around energy markets, you know, gross in our business, is the price of gas. And it's a totally different story because gas directly influences the price of electricity that people pay. It's the kind of primary fuel that goes into your combine gas turbines, which makes up a third of the fuel mix in both the UK and the US. And the way that energy markets are structured and the kind of price discovery mechanism on energy markets is very heavily indexed towards the gas price.

So what that means is when there's supply disruptions to the LNG around the world, what you see is a direct impact immediately almost on. the price on power markets. And in terms of the kind of US versus Europe, UK comparison, the Europe is a heavy importer of gas. And typically what happens is that you have seasons where there is injections into gas storage facilities. That typically happens over the summer. And then you've got seasons of withdrawal

from those storage facilities. And obviously naturally, you know, during the injection season, which is now coming off, the price kind of, you know, worldwide of gas and heavily influences, you know, ultimately the costs that Europe is paying. On the flip side, US is, with the recent Shale revolution,

fairly insulated, as we've kind of seen a little bit, on the gas side of things. And that is going to be something to watch over the next few years, though. And the reason for that is, when you look at there, there's a certain decoupling between the Henry Hub price, which is the price, the kind of standard price of gas in the US and the kind of the price of GCF, which is the kind of European UK index, those are somewhat decoupled

because the US, because it's such a recent market, is slowly still ramping up its export capacity, which means that right now there's this decoupling, but we do expect that decoupling to actually decrease over time. And the kind of consequence that that is, right now there's quite a quite a lot of insulation for the US market and but not at all for the for the UK market but that decoupling you know as I kind of said we'll love to converge over time but yeah ultimately when it comes down to our business it's it's the price of gas and the flows and the kind of status of the storage facilities around Europe because that's where we're operating right now is what really influences what we're paying and then ultimately what customers are

paying the other one gotcha and maybe just this sort of again frame a picture for everyone watching and listening. $100 a barrel for oil sounds moderately scary. 150 is very worrisome. $200 is downright terrifying, and that could lead us into stacculation territory. Could you sort of put natural gas prices in those terms? And I know, I mean, just I'm not an energy expert,

but it's easy to remember, especially during the Russian invasion of Ukraine from 2020 to on, sanctions put on on Russian energy exports. And nowadays, people are talking about the closure of the Strait of Hormuz. And while some oil processing plants have been shut down and it might take months for them to start up if and when this conflict ends, the strait could reopen immediately theoretically. Whereas Iran's attack on Qatar's like big processing and export facility, I believe knocked off 20% of its total capacity. And Qatar is a huge LNG exporter. That could have much more permanent effects from what I could tell. So how does that like, again, quite a pick,

kind of a long question, but like what are the prices right now and how is that actually directly impacting customers? And then again, like, because of this like big attack on the infrastructure, what challenges will that present moving into the future? Yeah. So I mean, right now the price of gas are basically about 50% above, 50 to 70% above the kind of usual price that, was kind of we would expect around this kind of here. And, you know, ultimately that is down to, you know, obviously the disruption through the straight of hormones. And, you know, when we kind of look at it, like beyond just crude and LNG,

you've got like disruption further to, you know, not just gas prices, but a bunch of other prices as well, right? So, for instance, 30%, 34% of global fertilizers come through the straight, right? There's also effects. So that ultimately affects food. And then also, you know, kerosene is mostly sourced out of Qatar and straight as well. So that obviously influences the price we pay for jet fuel. And further effects on that is like there's about a quarter of the world's sulfuric acid comes through the gulf.

That is needed for things like explosives, which is obviously very hot and topical right now. And also, you know, we're finding things like copper, which is essential and plus. to many things, including a lot of inputs in the energy industry. So as a consequence, essentially right now, what we're looking at is gas prices are, you know, quite like fairly elevated, probably not as aggressively elevated as what we've seen with oil. And not quite as aggressively elevated as what we've seen through the Russia-U-Crain crisis. And that is in part because, you know, especially in Europe, there's been a lot of measures taken since the 2021 crisis to kind of, you know, obviously mitigate the, uh, the serious

effects that that crisis had and causing, um, you know, kind of the disruption to the energy markets back, back in 2021. And so that said, like essentially what we're seeing is right now, we've seen an increase. And but not as aggressive what we've seen in the past. But however, one of the big issues that, you know, that probably a lot of our listeners is seen is that, um, you know, you know, this disruption and this attack on the facilities themselves, these are multi-billion dollar facilities that take decades to build and a very long time to repair. So the long-term disruption is something that I feel like isn't fully being factored in right now.

And people, you know, view that, okay, look, this is a short-term thing. We'll see a taco and then, you know, prices will return to normal. but in fact, what we're not really recognizing when I kind of think that a lot of markets aren't really recognizing is that do these really severe long-term effects

on global support. They're going to percolate and last for quite a few years. And I think that probably leads me into my next good question, which is, again, you guys are, I think you described yourselves as a full-stack power plant or a full-stack power company.

You do help generate for your customers, renewables, but you're also, from when I can tell, a wholesale energy purchaser and supplier. So you sell LNG in that type of fuel, or you sell electricity generated from like those types of sources to your customers as well. How are you hedging prices in this particular environment,

especially given what you just said that you think people are sort of underestimating the longer term impact? And I'm also, this is also happening right in the middle of an explosion in prediction markets where, I mean, oil derivative contracts on places like hyperliquid are seeing massive volume to the extent that the second biggest markets outside of Bitcoin. So what are you seeing? How are you hedging, especially in a world where, well, maybe it's ideal at some point to generate almost all of your energy from renewables. that's not really practical at this point. Yeah, of course, yeah, a couple of things there.

So I guess first, maybe just to give like a quick little bit of background on like the structure and the price discovery mechanism in power markets. So and even if your fuel mix or what you use to generate your power in a given region or country is like, let's say, predominantly renewables, in most competitive markets, actually the price of gas ends up setting the price that everybody pays for, for energy. And the reason is essentially demand is fairly fixed. And so let's say, Steve, you and I are buying power for an hour tomorrow starting at noon. The demand for power in that hour is fairly inelastic, which is actually a big issue that we're looking to solve. And what happens

is you have your generators will bid in and those bids will be price ranked. And essentially, the most expensive bid that meets what the demand requirement is sets the price across the market. So even if renewables make up 90% of your kind of generation mix, often it is the price of gas, the gas that fills the gaps

and it is the price of gas that then sets the market-wide price. So often when we're thinking about hedging and looking forward, we are looking at, you know, actually, okay, there's going to be, there's actually extreme sense,

in power markets to the price of gas. Even when you look at a cost basis, gas actually doesn't make up a large cost to produce the energy in the first place, which is, you know, you can have a separate debate on like if that's the right market structure or not. But so when we're thinking about this, we're thinking about our kind of trading operations,

and generally we operate a very neutral long or like slightly long desk, and our kind of trading operation has a modus operandi of derisking. So how it works essentially is we have, for a given day in the future, you have a certain amount of demand. And, you know, our delivery obligation is actually, you know, unknown, I suppose, or forecast it. Unlike, you know, maybe. And that's kind of a difference to energy markets and maybe traditional. You're a growing company as opposed to a mature, like, utility that, like, had. Yeah, exactly.

And then also, you don't actually know how much people are going to use when you're looking at, you know, like, if you ask me how much energy, you know, my customer base is going to use in three months time, I can only give you an estimate of that. Because it's highly dependent mostly on temperature, which you cannot forecast that far in advance. So what happens is we essentially buy these kind of fairly flat blocks, and we kind of DCA into those over a couple of months. And we slowly build out the box to essentially what we think the kind of customer demand profile is going to be. It's generally bimodal. You've got a peek in the morning, out of a peek in the evening when people are home. I'm sorry, just to interrupt, when you're buying these blocks, you're buying these from energy producers?

You're buying them from heading, yeah, generally on power exchanges. Sorry, okay. Yeah. So essentially, you're kind of like slowly essentially hedging out your exposure to that demand profile that you forecast it. And then what happens is when you get, and essentially what we do is we love to kind of close with a fairly flat block every day. And that's, you know, more so especially in the current environment.

And then what happens is, you know, kind of day ahead when you have a lot more information about, you know, the particular shape of what your customer's kind of demand profile is going to be in the energy that you need to provide them. You buy more refined blocks then. So you buy the kind of hourly blocks that you use to kind of shape out the demand, which is very temperature dependent. That's interesting. So you're buying these on almost like an hourly or daily time horizon. You're not a family time horizon. You're kind of like a farmer who's selling a futures contract six months out so that you can kind of guarantee your price for your heart. that this is much more short-term duration.

How much more expensive is it to, I guess, hedge exposure to engage in this type of, engaging these activities given the heightened volatility for you? So it is, yeah, right now it's much more expensive. And typically what happens is that what, if you're like hedging under a kind of, you know, fairly market standard approach, typically any of the kind of customer, you know, price and protections and stuff

will reflect that by the time you actually get to delivery, so you're not kind of breaking regulations around, you know, pricing your energy too high. But, you know, one of the other things we kind of love to do then is we look to kind of buy essentially, you know, a couple of other products that, you know, hedge our exposure to further increases in generally volume and price. And so that's kind of like our exposure kind of varies quite non-linearly

with both, you know, temperature, which affects both price and demand. command, right? And so typically, you know, you build out these kind of hedging blocks and then you shape them as you get closer to delivery. And then for, you know, specific, you know, either macro events or, you know, cold snaps or that kind of thing. And we'll buy kind of more sophisticated kind of options or temperature dependence options and that essentially allow us to ramp up or ramp down exposure depending on the conditions at the time. And I guess to your point around like, energy prediction markets obviously become a huge, hugely relevant right now.

And, you know, one of the things that we're kind of interested in, you know, long term is seeing, you know, does this have, you know, institutional viability? Right now, the markets aren't liquid really enough. And also the kind of products that we would be looking to buy as a kind of institution are quite complex. So like I kind of said, like I kind of mentioned, and with the kind of nonlinear effects, especially on temperature on your exposure, and because it affects both the price of energy and the demand that your customers are going to use. We typically, like, buy these quite complex,

bespoke products, and that essentially scale up or scale down with the temperature. And then there's also, you know, kind of things like to consider, like, basis risk between what the measured temperature is and the temperature that your customers are actually using, which is ultimately what actually affects things. And so these are the kind of issues that we're thinking about solving or would love for somebody to solve. As we think about, you know, okay, how do we, you know, potentially bring more energy products on chain? Yeah. It's interesting. I mean, the, like the derivative contracts on somewhere like hyperliquid. I mean, they're cash settled. I mean, people are really just betting on the price. I would imagine you're actually taking physically delivered products if that's what you're

buying. Yeah. Like, you've got financial or physical products that you can trade. And so generally, like, the products that you would see being, like, traded proprietarily would be financial products. You're not actually expecting delivery of the commodity itself. Yeah. But you are.

Yeah, you are. Yeah, you are versus hyperliquid. You're not. You're literally trying to leverage the volatility to put on a market position or something like that. And in that case, temperature and those types of things don't really matter. Whereas for you, I mean, you have to be able to deliver this. So you have to make sure the goods that arrive are sellable. I mean, it's very akin to almost like a refrigerated container for produce that gets sent to a supermarket or something where like you have to make sure that the products don't spoil on the way to transport.

I think that's kind of how I'm trying to know for that. Yeah, that's kind of knowledge. Okay. All right. So we're going to talk a lot more. we're going to get into your movement into the D-PIN economy and the launch of a token-based network. But before we do, let's take one more quick break to hear from some of the sponsors and make their show possible. Multi-chain Advisors is an emerging technology growth firm that has helped create over $50 billion in enterprise value for more than 80 clients, like Pith, Moon Pay Commerce, and Wormhole.

They've worked with some of the largest and most impactful companies in the space. They're the partner you want when you're navigating markets and trying to break out from the noise. They help navigate TGEs, go-to-market, BD and partnerships, Capital Markets Advisory, PR, media placements, K-O-A activations, and more, driving execution from launch to scale. Their results are measurable. To learn more and start building real traction today, visit multi-chain adv.com. Quick note before we continue with today's episode, Bits and Bips now has its own dedicated home. off from Unchained and launching a standalone podcast and YouTube channel focused on the Fed,

macro, AI, and how it all collides with crypto. If you want to keep up with our weekly live streams and macro meets crypto breakdowns, make sure you're following Bits and Bips directly. We won't start publishing until March, but getting set up now means you'll be ready on day one. You can find the new Bits and Bips channels at UnchainedCripto.com slash Bits and Bips. You can also find us by searching Bits and Bips on YouTube, Apple Podcasts, Spotify, or wherever you listen. Okay. So we're back. Actually, before we continue, I need to do a bit of quick homework I forgot to do in the beginning. This episode, as all episodes are, is strictly for informational and educational purposes. Nothing that you hear is financial or investment advice for full disclosures. Please see Unshamedo.com backslash bits and bibs. And with that, we're back with Sean and really excited to talk to you because, you're launching a kind of a token-based D-PIN network.

Deep-in for anyone who doesn't know stands for decentralized physical infrastructure. It has been a buzzword throughout crypto for years, but to be perfectly frank, I'm yet to really find a project that has successfully kind of gotten that escape velocity. You guys might be a little different because you've built from, as we discussed before, a very promising and lucrative business before even getting into D-Pen. So talk to me a little bit about sort of the thought process behind launching this network and kind of, yeah, I mean, why do you think you're going to succeed when a lot of other deepened projects have failed to sort of get off the launch pad?

Yeah, very fair. So I think historically, there's a lot of deepened projects that are somewhat of a solution looking in search of a problem. and are often demand constraint. And what we've seen is, you know, we've been wanting to build something on chain since day one, since, you know, three, four years ago that we started this. And we've identified one problem that is really, you know,

not talked about enough that persists across the energy start no matter which layer you're building on. And that's grid capacity. So right now, we've got these versioning, like, production facilities, generation facilities, and then a lot more consumption, you know, data centers, robotics, manufacturing facilities, than we really ever envisioned on our kind of grid networks. You know, our grid networks were built 150 years ago. Edison era never envisioned to support the loads that we're pulling.

putting on it in the 21st century. And that has manifest itself in quite a few issues. You're trying to build anything on the grid, be it a new generation plant, like a new wind farm or solar farm, or, you know, a data center. You can have the permitting, you can have the planning, you can be ready for kind of engineering and procurement, construction. But when you ask the grid, can I plug in here

and either put power in or take power out, the response from the grid is often, you can't do that because we haven't got capacity for you. And often, what we're seeing now is decade-long delays for grid reinforcements in order to be able to plug in where you want to. And that's obviously got huge downstream effects on economic progress and development and also just lowering energy prices for the economy in general.

Then when you're looking at energy markets, you've got constrained grid capacity, which often means that sometimes you've got a lot of, let's say, renewable power in a certain region. when it's particularly sunny or windy, for instance, in that region. You've got demand centers separated from that. And, you know, this fine capacity line that often results in not being able to move that power from where we have it to where we need it. So when you're looking at kind of like the statistics from that, like we kind of estimate that over 70 billion in the last kind of five years or so worth of, you know, renewable clean, low cost power has essentially been shedded because we can't move it across the grade to where it's,

needed. Obviously, that's got huge downstream effects on the costs of energy. And then finally, obviously, you know, ultimately, who puts the bill for this? It's ultimately consumers, people who pay energy every month. So the analogy I actually like to use is that grid networks are suffering from congestion issues, very similar to how Legacy L1s suffered from congestion issues. You've got limited network capacity, peak demand, and as a consequence, you know, network congestion, high gas prices and during during those times. And ultimately it's a scalability problem. So what we're looking to fix as part of this is essentially use these demand centers

and coordinate essentially making demand more elastic to grid conditions. And what that actually means, you know, in practice is we want to connect to devices that are in homes already. So these are like smart devices like smart thermostats, EVs, chargers, batteries, solar, that kind of thing. And then programmatically have them respond in when they're using energy to the conditions of network congestion on the grid. And effectively what that means is if we can leverage all of these millions of devices that are already just sitting in homes, like unused right now, there's gigawatts of capacity there. If we can use those to actually respond to the grid conditions in real time, we can significantly reduce congestion on the grid, which has tons of knock-on effects into the kind of, you know,

both the energy system and the global and the kind of economy as well in terms of being able to build stuff on the grid faster, being able to build manufacturing facilities faster, having less volatility on the energy markets, so it means we need less provisions for reliability, which ultimately means lower costs of energy for everyone so we can do things faster. So that's basically essentially the core of what the kind of energy network, which is the kind of Deepen project that we're looking to release is going to do. I'm happy to talk about, you know, kind of our kind of further reservations about being, you know,

put in the deep end category. But, yeah, I'll place there. Yeah, and we're going to get into that. But I just want to ask a couple of, I guess, clarifying questions. One, I believe you mentioned something like these devices are holding energy that that's going unused. I just want to make sure I'm understanding that versus sort of maybe devices that when I was reading about your company to prepare for the interview,

is more like trying to figure out a way to increase demand during times, like perhaps in the middle of the night when, like, cooking obviously has to be done a certain period of time, but there might be times when other things can be done with less demand versus like these devices having energy that they could perhaps return to the grid. I just don't clarify that. And then too, just to kind of frame reference for readers, I mean, we hear about insatiable data demands for these new AI centers. I mean, anyone in crypto, and we've covered like,

the conversion of Bitcoin miners into like AI, HBC centers and kind of how it was a gold rush for these because they have all this infrastructure and they're already plugged into the power grid. Like they take gargantuan sums of energy. You serve, I forget how many, I guess, hundreds of thousands or 250,000? Yeah. So, I mean, I know growing company, but like, is, at what size do you have enough to really perhaps be able to offset the demand from these insatiable data centers? that are continuing to build.

Yeah, great question. So I guess maybe to disambiguate the kind of the wasting energy versus the kind of devices and scaling, when you have limited grid capacity and you have wind farms or solar farms, these are big utility scale sites that are overproducing, often they're actually told to turn off because the grid can't move the energy where it's needed.

That's a huge waste, It's a huge opportunity cost on the system, right? And that's a consequence of, you know, grid capacity. And the other side of things and what the solution we're looking to do is when the grid is congested, let's say there's a lot of demand on the grid right now, it's super congested. We're shedding, let's say, renewable loads. If we can get devices and coordinate them to turn down, we can essentially reduce the load on the system to allow it to flow more efficiently.

So that's kind of the, it's called demand response. And we're making essentially, we're coordinating the consumer demand base to be more reactive and intelligent in responding to the conditions, the real time conditions in the grid. So that's kind of essentially what we're looking to do with the kind of energy network and the coordination system that's kind of all incentivized with the kind of energy dollar token that we'll be releasing. And then in terms of like how much is actually needed. So right now, you know, you can look at like a smart thermostat, which is, you know, probably got like a kilowatt or two, depends on like the house and the heating system. And that's kind of got a kilowatt of two of, you know,

like flexibility that you can ramp up or ramp down on demand. Similarly with batteries, you can go up to like kind of standard is around 10 kilowatts. You can kind of ramp up or round down. And then, you know, similarly with EVs and solar panels. So if you can like, it's actually the threshold of devices that you need

to kind of make a difference and start, you know, kind of playing, in things like power flexibility markets and kind of actually starting to kind of earn for load shifting. It's actually quite low. It's only about 0.1 megawatts. So it's we're talking about you know, 100 homes with with, we're talking about 100 homes with smart thermostats or you know, you know, 10, 20 with with batteries that, you know, can we can start participating in power markets. Then when you're talking about like data centers themselves, you know, they go into the, you know, tens, hundreds of megawatts generally. So what we're talking about, we're talking about,

That is, you know, tens of thousands of homes to kind of offset a typical data center. Okay. And, yeah, so I think, like, in terms of, like, the economics, it's actually, actually kind of makes sense because a lot of these devices are actually already there in homes already. They're just unused. So you could be, you know, you could have a smart thermostat at home that you're just using for your temperature when you could actually be contributing to the grid, providing services to the grid and earning for that as well.

Okay. Interesting. So let's get a little bit more into the specifics of your token and the energy network. I believe it's either, I guess Q1 is just about over. So I'm guessing you're going to try to launch in in Q2. Can you give us an update on that? And I believe there's going to be a 10 billion token supply. And you have some, there's different distributions for users versus investors versus

the company and plan burns, et cetera. So just briefly kind of walk us through the setup, the tokenomics, how this is going to work. And what is the utility of these tokens? Because you got a new action letter from the SEC, which really only comes when they believe that this token is going to actually have utility and not just be a tool for speculation. Exactly.

And that's something we've emphasized from the very start. You know, we're regulated in two different industries, heavily so. you know, energy and crypto. So everything we've done has been with, within, with a gear, an ear towards compliance and ensuring that we, you know, release something that's actually useful and not just, you know, an investment vehicle or a speculation vehicle, basically. And so how the kind of token works is very simple for the user. And, you know, user kind of logs on to our kind of fuse up. And they kind of have to be, you know, providing, being provided energy bios. And they can connect their devices. So things like, you know, I want to, let's say, let's

I connect my Tesla E.B. Charger. So I sign into my Tesla and I grant permissions me up. I say, I want my Tesla to be charged 20% or 70% by 8am every morning. And then outside of that, I don't care what you do with it. You can kind of use that to provide grid services and optimize grid and reduce grid congestion in the background. And for that, I provide direct value and I'm generating direct value and contributing to actually the energy system. And for that, I'm getting rewards in our kind of native token built on Savannah, which is the energy dollar. And for those rewards, essentially, then what happens is I can, I unlock discounts on goods and services within the Fuse ecosystem. So let's say later when I want to install a new solar array on my roof, let's say that solar array costs, you know, 15 grand.

And I can actually take the tokens that I've earned, burn them, which reduces the supply of the tokens. and access, let's say, you know, let's say I burn $1,000 worth of tokens, and I can access, say, you know, two, three thousand dollar a discount on my solar array. So that's the kind of idea of essentially how, you know, tokens are omitted to users for providing real utility and real value to the energy system, and then how they're essentially then burned and taking out of supply for actually like real utility in terms of, you know, value for the user. More broadly, yeah, so essentially.

the kind of emissions are kind of aligned with energy transition schedules. So we think very long term. We think that's the only way to build a kind of generational company. So the kind of emission schedule is out to 2050. And the idea is that we're slowly emitting to users over time as the kind of user base the network grows. But then also as the network is growing and more people are redeeming, where we're burning more and reducing supply. Plant and burn about 50% of supply through these customer kind of redemptions between now and kind of the end of the emission schedule. That's probably how the kind of token supply works. I am curious and I mean, I understand sometimes talking about the SEC,

there may be limits to what you can share. But the token is going to be listed on exchanges. I know Coinbase has already mentioned that it's on the roadmap, and I'm sure that it's going to show up on various decks. as well. So there is an opportunity to get liquidity for the token. There are options beyond just redeeming it for discounts and then burning it. Did the SEC have any concerns about the types of exchanges it would list on or how many?

Or was it really focused just as long as there actually is concrete utility and it's not being marketed as a security, that that was sufficient to get the no action status? Yeah, I think like the SEC letter was huge for us. And it was, and it was the product of months of like very constructive engagement with the commission. So essentially their main focus was, yeah, around the utility and the fundamental mechanics of the token as opposed to like where it would be listed. The idea is, yeah, essentially like they're, what they cared about was, you know, is there really like a consumptive utility to the token in the sense that like people actually, you know, use the token and burn it and extinguish it for like actual, you know, consumptive value, which is like, you know, buying something that they're looking to acquire. And that was,

that was the main kind of focus for them. And ultimately there was a lot of back and forth. But on the secondary market side of things, like the idea for the secondary markets is to, you know, to facilitate exchange between, you know, net buyers and net. sellers of the token. That was ultimately like exactly how we do that, you know, is as long as it's, you know, compliant and in line with the kind of details presented in the SEC letter, there wasn't much further kind of discussion around, around exchanges where we less or the particular venues. And I saw, I believe I read somewhere that you're not going to be having any sort of airdrop, which is interesting. And from my opinion, I believe, if that's true,

it's a good choice because it kind of, to limit the chances of just the big surge in usage from airdrop farmers that could then lead to a massive withdrawal whenever the airdrops end. And for a business and an industry that's already highly volatile, that's probably something that you're looking to avoid.

So, but do you have any expectations for how this is going to change the usage, the growth of your network? Do you have any sense of what would be an ideal burn rate to get to the $5 billion? Anything you could

along those lines? Yeah, sure. And I think this is, again, what kind of distinguishes us from like a typical deep end category project. Like I think I would kind of describe this as energy infrastructure over deep end

because historically deepens are, you know, very supply constrained. They need people to, you know, buy their XYZ proprietary devices and often they give away a lot of supply in order to try and bootstrap that, right? We don't have that issue at all. We're device agnostic.

We have a captured user base of hundreds of thousands of users already that's only going to grow. you know, we're hoping to hit, you know, over a million users over the next, over a million kind of homes over the next 12 months. And so we're not really under that constraint that we need to like shed a ton of supply in order to get people on board and onto the network and using it. And we don't need people to buy, you know, our proprietary hardware. They can just connect stuff that they have at home already. Although we are looking to release proprietary hardware over

the next few months, which should be interesting. But I mean, I think as a consequence, you know, ultimately I think when I look at Air Drops, I think they're going to be used historically as the most expensive marketing campaigns in history. Like when you look at like giving away $200 million worth of tokens to often what are like

can be you know, you know, mercenary farmers. I think it's just net negative for the projects and the way we're looking at it is we're going to like consist, we're going to provide tokens and distribute tokens

for the fundamental value that the network is generating and not for spammy like kind of quests and that kind of thing. I know shade against that if you want to do it. It's a great way to get distribution, but it's not really the way we're looking to approach things. And we think, you know, when we're actually looking at, okay, we want this to be still working and usable, you know, in 2050, you know, after, you know, 50, 100 years of, you know,

feuds growing and becoming like globally dominate as an energy major, the way we see and the lens through which we make these decisions and using that, it just felt like giving away a ton of supply to get like early kind of eyeballs just wasn't quite like our kind of skin. So that was the idea. One more quick one before we wrap up. Do you have any contingency plans in case people don't want to trade in these tokens for discounts? But instead, even if they're not airdrop farming,

their farming for tokens and they prefer to sell them on the open markets so the supply doesn't decrease in that flywheel. I know you didn't use the word term flywheel, I guess I am, but if that momentum doesn't start, do you have any sense of what you might do if that situation occurs? I mean, for us, I think to be honest, well, A, I think many projects, you can kind of ask for almost any projects. Like what happens if the, if, B, people don't use the token, right? And I have to be, to be perfect. But like, I think, I mean, for us,

the way we've built this product is incredibly native and seamless with the rest of the product as a whole. So, you know, we're using embedded wallets. You know, essentially, you get, you get your tokens kind of dropped for making these activities. And it feels very seamless

to like the rest of the product that you're, like, using for your energy supply. and paying your bills every month on. And the way we're looking at it is that we were just essentially making it as seamless for the Web 2 or the Web 3 user to use these tokens as possible. And like essentially if I'm getting dropped these tokens and I'm looking to buy stuff within our ecosystem

and these tokens are available in my wallet and we can show you that this is the amount of discount you get when you burn them and extinguish these tokens and reduce the supply. Like that is a very seamless and integrated experience for the user. And it's something that it's like it's a direct immediate value to the user that like we think is going to be a, you know, a no-brainer for them when they when they actually want to, when they go to to buy these products. So we don't, we don't view it as, you know, having contingencies in place. I think, you know, especially the kind of, I think, you know, down the line, I think the kind of buy back and burn mechanism. that is titled by a lot of projects today, which is, you know, very successful extensively.

And I just, I think from a compliance perspective, we weren't totally comfortable with that. And so we're really relying and pushing on, you know, fundamentals and creating value for the network because we think that's what is going to make this network stand up for decades, as opposed to years. Okay. All right. Well, just about a time. Is there anything, I didn't ask you, anything else that you'd like to leave our listeners and viewers with? I think mainly just, you know, if you want to learn more about what fuse are building and the energy network and follow us on fuse energy on X.

And, yes, stay tuned over the next couple of weeks. We've got some kind of exciting announcements and, you know, competitions and, you know, competitions and events planned. And, you know, obviously, we've got TGE coming up. So, yeah, looking forward to the launch and hoping to bring people along the road. Great. All right. Well, Sean, thanks so much for joining. Thanks everybody for watching and listening. That'll wrap things up for bits and bits the interview.