Unchained - Bits + Bips: What’s Really Driving Bitcoin—and Who’s Driving Crypto Onchain? - Ep. 919

Episode Date: October 8, 2025

Bitcoin is hitting new all-time highs—but is this real euphoria, or just a prelude to it? In this double-header episode, we bring you a Bits + Bips roundtable and an in-depth interview on the five companies best positioned to bring crypto onchain. First, the Bits + Bips crew, Lumida’s Ram Ahluwalia, FalconX’s Joshua Lim, and NYU professor Austin Campbell, break down what’s really driving this crypto rally. Is it dollar debasement, asset revaluation, or just pure animal spirits?  They debate how close we are to a true blow-off top, how to spot a real market peak, and what shocks could shelve bitcoin in an instant. Plus, their takes on Zcash, Japan, Coinbase’s banking ambitions, and more. Then, Unchained’s Steven Ehrlich sits down with Ryan Yi, author of the Onchain 5 series, to discuss the five companies that are leading crypto’s push into real-world adoption.  From Coinbase’s Base app and token plans, to Robinhood’s play for tokenized assets, Stripe’s all-in crypto tech stack, Telegram’s TON-powered mini-app ecosystem, and Binance’s BNB-based loyalty empire, this is the playbook for what going onchain really looks like. Thank you to our sponsor, Aptos! Hosts: Steve Ehrlich, Executive Editor at Unchained Ram Ahluwalia, CFA, CEO and Founder of Lumida Guests: Joshua Lim, Co-Head of Markets at FalconX Austin Campbell, NYU Stern professor and founder and managing partner of Zero Knowledge Consulting Ryan Yi, Ex Coinbase, Coinbase Ventures, and CoinFund For links to all the amazing articles, visit https://unchainedcrypto.com/bits-bips/bits-bips-whats-really-driving-bitcoin-and-whos-driving-crypto-onchain/ Timestamps:  0:00 Intro  4:38 What Josh learned at Token2049 about what’s really moving the market  10:12 How the options market is quietly driving bitcoin’s price  13:25 Why Ram says this isn’t a “debasement trade,” despite what everyone thinks  20:29 Whether we’ve hit peak euphoria—or not even close  23:54 Why Zcash suddenly exploded in price  26:45 How political changes in Japan are shaping markets  30:30 How to spot the real market top—and why Austin challenges Ram’s call on stocks beating gold  35:41 How CME’s 24/7 futures could change crypto trading  39:20 The signs Ram thinks would signal when the top is in  43:43 How bitcoin, altcoins, and tech stocks trade together and how they don’t  47:59 What kind of shock could finally take bitcoin down  51:34 What to make of Coinbase applying for a banking license  53:34 Whether Galaxy is trying to become the next crypto super app  57:59 Why this cycle might play out completely differently  1:02:04 Why Ram believes banks are about to crush earnings  1:03:03 The biggest risks investors still aren’t paying attention to  1:07:56 Meet 5 The Firms Poised to Drive the Next Wave of Crypto Adoption  1:08:53 Why distribution is the key battleground for the next wave of crypto adoption  1:12:24 How Coinbase is rearchitecting its platform around Base  1:15:42 What the upcoming Base token and Base app could unlock for users  1:19:13 How Robinhood is competing in crypto—and why it might have an edge  1:25:56 What the tokenization trend means for Robinhood’s future  1:27:52 Why Stripe is building a crypto tech stack of its own  1:35:02 Why Telegram’s TON token is central to its survival and growth  1:41:40 What’s behind TON’s lagging price performance  1:45:13 How Binance uses the BNB token as a cornerstone of its entire ecosystem  1:52:43 Why going fully onchain could be the defining strategy for the next generation of companies Learn more about your ad choices. Visit megaphone.fm/adchoices

Hi, everyone, and welcome to a special double-header edition of Bits and Bips. I'm Steve Ehrlich, executive editor of Unchained. In the first half of today's show, I'm joined by Ram Al-Aluwalia from Lumida, Austin Campbell from Zero Knowledge Consulting, and Joshua Lim from Falcon X. We break down what's really fueling this crypto rally. Is it the infamous debasement trade or something else entirely? We debate whether we've actually reached euphoria, how macro factors are shaping crypto-priced. and what risks could be still lurking in the background. Then, in the second half, I sit down with Ryan Yee, former investor at Coinbase Ventures

and author of our three-part series that we posted on Unchained, The On Chain 5. And by the way, subscribe to our newsletter, Bits and Bips, where we delivered all of this content for free. Going back, The Onchine 5 are the five companies Ryan believes to play our leading role in bringing the next wave of users into crypto. Ryan shares his insights on how firms like Coinbase, Stripe, Robothood, Telegram, and Binance are going on-chain in very different ways and what that says about crypto's next chapter. It's all time-stamped, so feel free to use that as you will. Aptos is the no-compromise infrastructure for global financial markets, fast, reliable, and 100 times more cost-efficient than other blockchains.

See for yourself why Aptos is the chain of choice for instance. institutions, users, and developers alike at the Aptos Experience, October 15th and 16th in Brooklyn. Are we actually at euphoria or is it an octave below euphoria? We're in a bull market. All bull markets like climb to some degree, both the wall of worry and certain levels of optimism. The point at which you know you're at euphoria is when all of the bears have come hitched. There is this sort of renewed interest on like the revenue meta of investing in crypto, which as most tried-fied people just call

investing. Hi, everyone. Welcome to another episode of bits and dips, the show where we explore crypto and macro colliding, one basis point at a time. I'm your host,

Steve Erlich, high scribe of the Unchained Kingdom. I'm here with a few special guests. For one, returning, Austin Campbell, the high scholar of zero knowledge consulting.

And a new guest, Joshua Lim, who is the high captain of the Falcon X fleets. So welcome, Josh. Thank you. Glad to be here. I'm enjoying my new title.

Yeah, everyone always appreciates it the first time because they never know it's coming. That even goes for me the first time I joined. So, Josh, before we kind of get into everything, and I have some disclaimers to give as well, but why don't you just briefly share your bio with our audience? Yeah, happy to be here. I run the trading business at Falcon. Connects, which is a global prime broker and trading shop. We provide liquidity across a broad range of markets and also bilaterally, directly with

counterparties, mostly consisting of hedge funds and venture firms, high-not-worth individuals. Nowadays, a lot of corporate treasuries as well. But yeah, most almost entirely institutional customers. Okay. All right. Great. And it looks like Ram Alawalia, Maester of Lumida, is joining us. So welcome. Welcome, Ron. We have a full crew here today.

My favorite people. This is great. We got Josh and Austin together and Steve. This is amazing. And I have to admit, I'm really happy to be here with all you guys because I'm on pins and needles about the baseball playoffs and the Phillies start in an hour and a half. And this is keeping me. So we've got to distract you for a little bit. Yeah, this is, and they're already down one row. So this is keeping me from. All right. I'm going to give you a live look at Steve at about one to two hours. As always, nothing that we say here is meant to be investment or financial advice for full disclosures. Please check out our website on chaincrypted.com backslash bits and bips.

And with that, away we go. Josh, let's start with you. You just came back from Asia from 2049 and some other events. Good time to be out there because last week we're here talking about. talking about October and whether or not it was going to live up to his reputation. So far, so good. So what were some of the key teams that you saw out there? For sure. It was pretty exhilarating to be out there, honestly. It's something I do every year to try to get a good sense of what's happening in a part of the world that I don't normally have a lot of visibility into. And

yeah, this year, there are a couple of major themes that were emerging. I will say like it started off in a pretty rocky way, right? Because a lot of us were out there at the end of September for the Korea Blockchain Week. So obviously a lot of people were positioned pretty long, like going into those two set of conferences, Korea Blockchain Week, and token 2049 in Singapore. Unfortunately, that kind of coincided with like some end of month de-risking at the end of September. So we saw a lot of names, you know, actually get hit pretty hard. I think a lot of people were liquidated on the way down. And then that obviously set up a good base for the recovery rally going into token and

some of the major themes there that were emerging. So yeah, I just want to call out that there was a little bit of maybe people positional over their ski tips at the end of SAP. What we've seen since obviously has been extremely bullish. And it kind of reinforces some of the things that I learned at the conference. So, you know, one big thing is everyone is sort of. sort of all in on this, you know, Bitcoin, to some extent, like Ethan and a few of the other major Solana as a way to get away from the U.S. dollar, basically, right? The dollar kind of

debasement trade. And in many ways, crypto is lagging gold and equities to all-time highs. And of course, we got it today, right? Bitcoin hit a new high of 126K. And that, you know, was a long time in the making. And it really took a lot of maybe even like geopolitical kind of, wobbles to get us there, you know, including some of the turmoil overseas. You had the Japanese elections and the French prime minister resigning. And, you know, of course, here closer to home, we have the U.S. government shut down kind of overhanging all of us. And I think that's sort of the big theme, right? There's a sort of asset that doesn't have any sort of sovereign overhang, it can operate independently.

It's uncensurable, and it serves as a way to sort of protect your assets against inflation. So that's been like a big theme that we're seeing, and the rotation is really just starting now with the Bitcoin on that side. And then on the sort of like top 10 alts, right, like the theme was around upcoming ETF listings. You already have the tailwind from the DATs, the digital asset treasury trade, a lot of inflows coming in from there. And we're seeing a lot of the sort of second order effects. So once all these assets are sitting in the ETF, sitting in these digital asset treasuries, what benefits? It's really, you know, things like lending protocols, things like staking,

you know, staking tokens, LSTs. All of these things are going to be ways to deploy capital for these treasury managers directly on chain. You've already had a couple of the more forward thinking managers, you know, pretty explicitly say they're going to take those salana or those Euth and deploy them in some yield generating way. So we're seeing a lot of that, you know, it starts obviously in the more kind of benign ways like trading options with with a regulated counterparty or on exchange or, you know, CME options, things like that. But then, but then it can become much more complicated or in some ways much simpler, right? Like if you're just taking an asset and you're generating in a protocol native way, generating yield in a protocol native way. That's something

that is justifiable and pretty easy to explain as a, as this, you know, CIO. Those are some of the high-level things. I mean, there's a lot of things going on under the hood, right? There's the rotation trade happening into stable coin governance tokens like Athena and some of the other ones. We heard repeatedly there are a lot of funds that are just had historically operated as market neutral vehicles or quant strategies that were thinking about launching more complex, actively managed strategies under the guise of like a stable coin wrapper or some kind of like stable value on chain, you know, token. There's also a lot of focus on perpxes. We kind of saw that with the explosion of Aster as a competitor to hyperliquid. But there's maybe three or four other

tokens that I've seen, you know, a healthy appreciation like three or four X from pre-Asia conference levels. And a lot of this is just, you know, it's really hot money that's kind of rotating across these assets. It's really money that would have been in meme coins, like not that long ago, right? Like kind of things that we're launching on Pump. Dot fund. But there is this now, this sort of renewed interest on like the revenue meta of investing in crypto, which as most tried five people just call investing. There's a lot of that happening right now and a lot of rotation going to tokens that could potentially generate revenue from actual utility. So that's kind of exciting.

Yeah, those are kind of the main themes. Yeah. Let's pour one out for the meme coins. Real quick, I want to go to run. But before Josh, like your team came out with a report that was talking, I guess it was today or yesterday about how the options market is now driving spot price when it comes to Bitcoin. I was hoping you could just briefly touch all.

on that. Sure. I mean, it's pretty clear that, you know, there's endless appetite for options in Bitcoin particularly. Like, you can kind of see it in the growth of I-Bit Options OI, which in, surprisingly, a year and a half has exceeded the open interest on Deribit. So there's just a lot of demand out there for people to use these instruments to hedge and also to generate yield. We're starting to see, you know, pretty significant movements going into major expirates. So like that end of month expiration in September is a meaningful one to take note of, right? There were, you know, several billion dollars of options that rolled off at that point. And it's really every quarter you see a lot of those options roll off.

And that is generally going to have some fall increasing impact because, you know, a lot of the options that had been sold into those expiries as they roll off. there's a lot less gamma supply within dealer hands, so meaning like dealers that own a lot of options, no longer own them. And so it really loosens up the market a little bit for the spot price to move higher or lower dramatically, like post-ex-free. So that's kind of like one theme that we're seeing is, I would say if you asked me a couple years ago, I would have said not a chance. You know, the spot market and the perp market is a lot deeper than the options market, but we're at a point now where that's having some meaningful impact on spot prices. Got it. So, I would also hop in here to say as we think about that sort of dynamic,

if you want to see clues as to where that activity is coming from, we see the same thing in a lot of stocks that U.S. retail like to trade in the United States. Because especially when you're looking at relatively short-dated option expires that constantly roll out dealers exactly as Josh was talking about, you see that phenomenon driven by U.S. retail specifically. I mean, we saw the same thing in like the whole, you know, GameStop. after phenomena with retail stock trading. And it should just tell people something about, call it, Bitcoin entering into a new regime compared to a lot of the other tokens that we're dealing with. Like, I would tell you at this point, Bitcoin is mainstream now. Right.

You're starting to see retail trading. You're starting to see institutional trading. You've got all of the crypto natives trading it. Like, this is disseminating into the world in a way that maybe we're not seeing yet. Josh, I'd be curious as to your opinion with a lot of the other tokens. Yeah. I mean, not not yet, right? Like there is a robust, you know, all coin options market, but that all exists in crypto world, not in Tradify world. I think maybe the closest thing that trades with that much interest is like micro strategy because there's that micro strategy yield ETF that sells a bunch of options on micro strategy stock. But yeah, like other all coins, not really as much. All right. Cool. So, Ron, let's come to you. Josh mentioned the, the, the, the,

debasement trade. That is a very nice segue way to debate that you had with Vinny last week. That was very well received on sort of the competing merits between gold and the S&P 500. And sort of like unstated within that whole debate is where Bitcoin fits in. Gold's still going up and Bitcoin's still going up. Stocks are still doing well. Yeah. Yeah. About four or five days since that debate, Bitcoin sit all-time highs.

What are your kind of takeaways from that conversation? and what are you seeing right now? Yeah, well, I think Vinnie's up two days in a row on that, gold versus S&P, so I don't mind holding myself accountable to this. I got eight months and 28 days to go. Yeah, you still have a while. For anyone who has it who did not listen yet, Rom bet Vinny $10,000 that the S&P would beat gold

over the nine funds from Thursday to fly four. Late Momentum, you often kind of see that as Josh and Austin know too. They were meant to moves. They keep going up and up and up and up and then that's it. So timing this is always hard. Timing is always hard. But this is a chart on the topic of these basement is USD JPI.

So the funny thing about this is a trade, this is a sorry, US dollar Japanese yen. I could tell you a similar story for DXY, which is like a trade weighted approach like the dollar. but the headline around this is that actually the dollar is increasing in value. So the debasement trade is a trade that's alive and well, but it's actually not about dollar debasement. It's a narrative that got momentum and legs underneath it, and it's continuing. That's it, which is fine.

That doesn't make the rally less legitimate, actually. You start with an idea and a concept, gets rooted in people's minds, and then as to start to attract momentum, And it keeps continuing. I see the same phenomenon small caps. You know, it started as rates compressing and companies can refi. Now those assets have momentum. And they're going to keep rallying even though the 10 years come down to 4%. It's kind of leveled out here.

So I don't think this is really a debasement trade. People like to call it that. What it is, it's an asset revaluation. This is animal spirits. This is excitement. We're entering the fourth quarter now. And things could get really nutty here in a bullish way, in a bullish way. So it's really people are marking up each other's bags is what asset revaluation is.

That's what that means, right? Someone moved into the neighborhood and they decided to spend 30% more on the house in the neighborhood. So all the houses are worth more. And everyone's agreeing each other's houses are worth that much. So everyone's wealthier as a result. That's what markets do. That's how markets create wealth. Do you see it as just animal spirits or is there anything more substantive behind it?

A couple of their drivers, of course, of course. I mean, this is, what's the mean for this? Like the right meme is the person in a face who's in anguish and smile, you know, whatever, one of those things. Like, this is a pain trade rally. It is a hated non-consensus rally where a lot of people, look, I saw a study. we see the study come up once a month where people interview on the you know what's your view of the economy and if you're democrat you think the world is ending if you're republican you're like oh wow

this never been better it's only getting better we're addressing issues and the people on the republican side are optimistic about the future people in the democrats said are not historically we haven't seen this we go back like 10 years before we haven't really seen that maybe we have during the george bush era i don't know but historically to my knowledge we haven't quite seen that austin will correct me in the history, if I'm wrong around that. But overall, this is a people caught off sides story, right?

They studied in school. Tariffs were bad. The cause of the Great Depression was tariffs, and now they're off sides. And you see it, like, objectively and measurably in long, short positioning, for example, which is the data set I look at, like, every week.

And the percentile exposure is 50 percent of their historical three-year exposure, meaning they're underinvested, Walmart are trading all-time highs. So they have to buy every dip. If they don't buy a dip, they look silly to their LPs. Why don't you buy the dip? Like, if they could go back in time and get long stocks, they would.

So it is a, when you look at a chart where you're seeing as emotion and anguish driving this higher, the other thing I would say to this, it's a really interesting diet. There's so many cross-cutting dynamics that are at work in this market. Here's another one. So the consensus earnings expectations, the S&P have been steadily coming down over the last month and a half, just as credit spreads have widened and there's been fear around non-farm payrolls and are we in another recession,

which is not going to happen, okay? But probably you're going to see earnings beat that 6%. You know, last quarter earnings came in year over year like 12%. So suddenly we think that we're in advance one quarter and year over year we're going to drop to 6%. No, no, no, no, that's not going to happen. We're going to hit 10% or 12% again. So all that's super constructive. All that's very constructive. So it is an interesting time, though, like, because, you know, you're seeing these, like, you saw the AMD deal this morning, right? OpenAI got like 10% of AMD.

I want to dig into that transaction more closely. Essentially, AMD gets an anchor customer for their inference chips in OpenAI. And Open AI gets 10% of AMD. AMD stock went up. And Open A has got these warrants. So their stock theoretically has gone up to. Usually there's a loser in one of these trades, but both went up. It's that kind of market.

It's a funny market. Right. So, yeah, look, I think you might have a scenario, like, where at Q4, I could see S&P above 7,000 by year end. I could totally see that. I do think dips will be bought. There's a lot of local over positioning. And Monday rallies are kind of like shitty rallies.

to be honest, or don't over read into them. I think it's good to have Josh as you because Josh is from Falcon X. I don't know if you had a chance to introduce Falcon X, but you're at the flows and you're helping to cross markets and you're seeing what institutions are doing.

I think so you provide a lot of good market color there. And I always like talking to people like Josh regularly because it's a different data input than you might not ordinarily get just looking at, like research and other elements there. Ram, don't give away all my reporting secrets. You got it.

Mum is the word. Yeah. No, we went into it a little bit at the top of the call. But I honestly feel like the amount of excitement and, you know, almost, almost euphoria in crypto is, it's near a high for the year. And, I mean, mirroring the price action. But I think it's partially because there are ways to outperform now. just given the amount of sectoral rotation happening within crypto assets themselves.

So it's like, you know, these fund managers could historically could not perform by just being ahead of the trends and sort of like hearing things, quote unquote, from, you know, other people and moving capital faster. And those opportunities exist again, right? Like, you know, we already talked about the stable coin trade and the perplexes. But even in the last couple of days, you saw this new emerging narrative around privacy tokens, which has really gone unnoticed by a lot of people, right? Unless you're kind of deep in the weeds and you're kind of watching, you know, top 1,000 alt coins and seeing what's outperforming, you know, like things like Zcash is trading at like $160. And two weeks ago, there's like a $40 token.

So these things that have been forgotten for five years or more are coming back. That's really exciting. Yeah, there's a lot of dispersion. Yeah, a lot of dispersion. Do you see, like back to euphoria, and that's one of the things I always look for as a sign of like market tap. I don't think we actually have that. If I look around just markets broadly, I don't see that.

I think people have a lot of. There's still fear. There's still people off sides. But you made the qualifier in crypto markets, in crypto markets. So, you know, I think a lot of funds have lagged Bitcoin in in crypto. So what are they going to do now? Are they like forced in a performance pace now? Or like what's their, you know, what are the top three moves?

It's like revenue back to the dat trade seems like it's mostly in the rearview mirror now. although so they're really starting to work in recent months. But people have realized that, like, you don't need 97 deaths. You just in a handful of that liquidity and a good mean person to lead it. But are we actually at euphoria or is it an octave below euphoria? Yeah, octave below is probably the right way to put it. It's almost like I could see a path towards later this year or even in Q1 of next year, like a real blowoff top.

type of move in crypto. And we're not quite there yet. We just broke all-time highs, right? And the money, like you said, is not really in crypto. And it hasn't been for the last year or two years. It's been in equities. It's like all the speculative capital is trading, you know, meme stocks and, you know, AI and the quantum computing narrative and all this other stuff.

And now it's like you could see all that come flooding back into crypto. and that will meaningfully move asset prices for our little corner to the world. Josh, what do you think is behind the privacy? I was actually just looking at Zcash and Monaro and NIMS. Yeah. I think, Rob, you know, maybe Austin. I've had my heartbroken to me at times over privacy coins because it's one of the things that I wish people valued more. And I actually wrote a story on Zcash back when I was at Forbes?

and I know they didn't like it because we called them a zombie token, even though I said I was rooting for the project. And why is it, it's up 225% in the last two weeks. But the other tokens haven't, haven't moved all that much. I'm curious if there's something I'm missing because I would love. You know, there's, yeah, there's a couple things.

There's like, one is people now are realizing that the sky's the limit again when it comes to crypto valuations, right? For the longest time, you're like, well, you know, can this, is this thing really worth like $10 billion? And, you know, with hype trading where it is and then like all these these perp-dex is starting to move again. And people are realizing that like you can actually start putting the huge amounts of multiples on things that are revenue generating.

And then if it's not revenue generating, you can even put, you know, higher like L1 type, you know, valuations around things. So, yeah, it's all coming back. I mean, like this, these are things that have been forgotten, like you said, for, many years and they're all trading at 200, 500 million FDV while there are new tokens that are gaining traction today that are like 10, 20 billion FDV

right? Think about something like plasma, right? Plasma just went live like a month ago and it's already achieved like a $10 billion FDV, right? So it's one of these things where it's like we're all remembering again the animal spirits that happen, you know,

cycle and now everything's getting re-rated higher. I think that's a big part of it. Cool. All right. Austin, what are your thoughts on what Josh just shared? Yeah, so as I was sort of noodling over Josh and what Ron was saying, I think there's a couple of things that are colliding narratives that are producing the current price action. So one, especially when you look at Bitcoin, don't just look at the United States, right? Like, it's important to remember the bid for Bitcoin is global. And a lot of it. historically has come out of Asia. So we just had kind of a surprising election result in Japan. And I will summarize the economic views of the new prime minister there is let's run it hot.

And if you're looking at that and you're looking at Bitcoin starting to go parabolic as you're having these sorts of moves, I do think there's a certain element infecting like all of this, which is the debasement trade that we've been talking about, right? It's important to remember, we really believe it's the value of fiat money falling, then in price terms, everything should be rising. You know, witness, for instance, gold also, like, really cranking up at the highs that you see Bitcoin following. Right.

Two is, as Josh said, crypto this time around has not been the leader. Gold went first. Crypto is, like, backfilling into where gold and equities have already gone. And if you believe that, that means if you're an alt-season person, we're going to see at least some of these either old coins or some of the new ones like, say, plasma or Astor, start popping off occasionally as well.

Like that sort of price action is not totally shocking to me. And it's one of the things that I think people misunderstand when they make comparisons about these regimes, like Rahm earlier brought up like tariffs is the cause of the Great Depression. And I would remind people, we were in a deflationary environment already after a credit shock at the time the tariffs were hitting in the Great Depression, and you could think of them as trying to defend the gold standard and preserve the value of money. Here, they're just throwing the value of money overboard. They're basically like, no, we're going to just keep doing this. Nothing stops this trade. And so in that world, the correct answer is, you know, and I think we're seeing this in the options

market as well, get long, hard assets and risk assets probably using moderate amounts of leverage. if you could borrow in like dollar denominated terms and go buy things like Bitcoin. And as a result of that, and as I look at the market action, I'm not seeing a lot of things, call it Bitcoin or gold, that yet speak to euphoria. Right. Like we're not seeing like, you know, cab drivers being like, I'm retiring, I'm buying a condo. It's all over. Like, we're done.

Levels of euphoria yet. We're definitely in a bull market. You should have been looking into Vinny on Thursday, Austin. That's where he was. Yeah, no, but we're in a bull market. All bull markets like climb to some degree, both the wall of worry and certain levels of optimism. The point at which you know your euphoria is when all of the bears have compensated. Yes, I agree, I agree.

Just sharing a screen here again, this is the Invesco Commodity Index. And what you can see here is that it's really gone nowhere, you know, in a year. It's actually lower than levels we saw from 2022. So if look at the holdings, this includes various commodities such as gold, silver, copper, copper, corn, crude, soybeans. So what's the point? The point here is that I can intend this is actually not a dollar debasement rally. That's the narrative. Again, it doesn't disqualify the nature of the rally. Gold is rallying, but like oil is a $60 a barrel. If there's dollar debasement, then the core energy source that runs the real economy,

Should we be repricing higher in real terms? It's not. Oil is $60 a barrel, right? This is momentum and traders and trends and trend following. That's what this is. What do you see is the limits? Like what are the key thresholds look for next? I think what Austin said is exactly right.

When there's no bears anymore? When does Jim Chato's cover his, Bitcoin short or MSTR short, right? I mean, how is MS, do we got to check it on? Has someone sent to an, like, someone's got to do like a safety check or a neighbor's got to visit knock on this check? That's what you're looking for. Like, Jim, are you okay? Check. You know, send him a gift basket to his office.

We can put in some calls in MSTR to hedge them out a little bit. I would check on Jim Chano. So if Jim Chamos, Chamos has to cover MSTR, that would be, that would be actually. when the short starts to work. But short of that, like, are we in, like, new price discovery mode? Are we just still in, like, a general, like... I think it would be good to get Josh your perspective. I think you are.

You're at all-time highs. You're old-time highs. So, yes, that's what it's supposed to happen now. And that's, you know, every single day you're now in price discovery. Yeah, I mean, I agree. I think, you know, by definition, right? We're through all time highs, like, people are trying to figure out where supply comes back in. And we've actually worked through a lot of supply issues, right, in the last couple of months.

There was very famously, like the $8 billion of, like, stale coins from a long time ago that were sold into the market. And a lot more like that, right? just like old, old coins moving and getting liquidated. And the market's absorbed all of that pretty well. Like we stayed well above, you know, really like the 110 level in Bitcoin

throughout the summer. And I think we're at a point now where you know, there is this latent demand for yeah, just something that's not dollars basically. I mean, yeah, maybe it's

not a dollar to basement trade, but there's something happening. Yeah, yeah. There's, there's like a desire to get into real assets, like hard assets and things that are not necessarily tied to some of the political uncertainties. I agree. I got around like Fiat. Yeah, good.

This is what I wanted to push back on a little bit of the like momentum versus debasement thing too. Rom is that I want to go back to what I said about this. This is it only a U.S. dollar trade. You are seeing. things like food inflation in Japan. Right. So as we think about re-rating, especially with regard to Bitcoin, I would really urge people

don't just look at dollar inflation for that one. Like it is possible we're going to have different things going out in the U.S. economy than elsewhere. And that could drive, like more than stocks that could drive Bitcoin. It is much harder for people in age to buy U.S. stocks and size at like the retail level. Fiat de Basement, maybe, if that's the right way to foot it. Oh, yeah. Fiat de Basement.

You should still see commodities rally, if that's the case, though, versus dollar, right? Yeah. And certain commodities are like gold. Yeah. What do you guys make of like this doomsday narrative that I'm seeing on Twitter a little bit, which is why people are going into Bitcoin and gold? I think there was a report from ARCA that was talking about it. Is that just like cheap marketing speak and taking advantage of an opportunity?

Or do you think there's something there? I mean, it kind of speaks to Ron what you were talking about. about a little before that people were kind of like clenching their jaws. They hate this rally, but they have to chase it. I think everyone that needs to chase is latent buying power. That's what it is. So I think dips will be bought. You know, there's a lot of changes happening in the markets now. Like you pointed out, Josh, like the I bet options are larger than Deribit now, which is a massive statement. You know, so BlackRock has about $100 billion in Ibit now. So $100 billion dollars are the Bitcoins in Ibit. They make $2,000.

10 bits off of that. So you wonder, like, is Citadel making more money off of Ibit's options market than Blockrock? Maybe. It could be. Right. So there's, I mean, the ecosystem just starting to shift now. You're starting to center on Block Rock and their options market. You know, Coinbase put in a bid to acquire Deribet.

I don't know if that transaction closed. That's closed, yeah. It's closed. It's official. Derbate changed their official color scheme to blue. Interesting. and have they opened up that market to retail investors or they still going from CFTC? It's international.

Yeah. It's still right. International market. Yeah, not, not US yet. And what do you make of CME launching or planning to launch 24-7 crypto features and options? How does that fit in here? Yeah, I mean, it's not, yeah, it's not that much of a stretch, right? I mean, they're just adding weekends, basically.

It's big for traditional markets for sure. And I think that was like the biggest. the biggest like crypto native angle that most firms had, you know, was like, hey, we, we, we're opening our markets even on weekends for, for traders. And I mean, I also think that trading like trad-fi firms are going to hate trading weekends. Like, you know, they're, they're going to have to hire more people to hire, you know, to cover Saturday, Sunday, things like that. But yeah, I mean, it's, that's just the first step. Like, I think the bigger thing will be when, you know, equities are going to be trading 24-7.

And that's actually going to be a hard problem to solve for most people. I guess once there's, like, more venues that are trading around the clock, there will be a natural, like, base of liquidity. But right now it's like, you know, where should some random, like, mid-cap name in equities be trading on a Saturday that, you know, especially if it's like linked to things that might be happening and geopolitical realm, it's anyone's guess, right? it's very tough. I would also say I think this aligns with a trend we're going to see across markets

that while related to blockchain, it's not specific to blockchain, which is things moving to 24-7 in general. Like there are a lot of places now that, for instance, have 24-7 real-time like money movement. So one of the preconditions that you end up with for actual effective trading 24-7 is you need to be able to, I don't know, pay for something, right? And so you get into this sort of iterative upgrade cycle, whereas underlying money movement moves, then you tend to see trading instruments move because like, oh, great, I can agree to a trade but can't settle anything for T plus two kind of makes weekend trading like academically nice, but not nearly as powerful as it could be when also I could settle the trade at like 3 a.m. on a Saturday. Right. So one of the things that blockchain technology is going to do to traditional markets.

So if you're looking at investing these, like people at the intersection of this, like the coin bases and the Robin Hoods and Citadel are all very interesting sort of objects to monitor are the ones that can benefit from sort of this upgrade cycle across financial markets. Because I would tell you my central opinion is 30 years forward. Everything is trading 24-70.

Yeah. And that's the vision of NASDAQ. That's the direction of travel. The right meme here is the North Korean farmer meme. It's all so tiresome. If we're all going to be around the clock trading, every asset in the world.

No more breaks for traders, I suppose. No good for cortisol levels and sleep. Yeah. Not good for overall health. AI is going to be trading at all. Why are you guys worried? AI will trade all. Which is another way of Stittale again, right?

By the way, that story I wrote last week about zero gravity that that I know it's not made many friends in the crypto ecosystem one of their value ads in that investor deck that we obtained is that they're going to use an AI agent to rebalance and manage the investing of the zero G tokens that they're putting into the machine or into the company so what could possibly go wrong is somebody who's maybe helped in a place that had algorithmic trading strategies before this will be There are a lot of venture funds that are raising money now. Venture funds are no when to raise money.

You raise money when everyone's in the money. And there's quite a few that have recently announced closes of new raises. That's good for the ecosystem, like longer term, right? There's more recycling of capital goes back into the ecosystem. Never been a better year from the do of it. And they really couldn't have in the last few years. They didn't have much to show for it. now they have, you know, points to show for it.

But I do think like the proliferation of Dats and all the rest, I think I thought Josh, you're putting around, yeah, I think we are like an octave below, below off top, but sometime early next year or maybe Q1 next year or maybe towards year end, I think it's worthwhile to prepare for something like that, you know? There's just so much issuance out there. Like who, who's not in? who's not in that well i guess there are people that aren't there's really two segments of capital

like the left behind crowd that clenching teeth that are buying every dip and waiting for the cracks that doesn't show up right then they're the folks that are in and have more confidence now because they're up a lot from the april lows and they just keep pressing it higher right so that momentum just keeps pressing higher and this crowd has to buy the dip and maybe they'll short it, but then they get squeezed down and it goes higher. You look at like quantum stocks, for example. I've talked to a number of money managers in the last week around these quantum stocks. Virtually everyone I know is just waiting to short the hell out of these things.

They're just waiting, but they aren't really doing it yet. Even myself, like I'm in. I'm like, it's not working. Get out. Get out. Get out. Wait, you put a fit in it. It's not working.

I'm out. I'm out. Right? But there is going to be some moment in the future where everyone has, you know, has this recognition moment. Like, oh, yeah, it's done. It's done, right? When does that happen?

What does that moment look like? I would keep an eye out for that. That moment will happen on social media, though. That much I'm 100% sure of. But there was a meme this weekend about how they took like, the headquarters of all these quantum stocks. You guys see this? It's like they looked at the HQ's these quantum stocks like,

like one's like above a dry cleaner in Midtown somewhere. It's like these random buildings in the middle of nowhere. Like, no, they, you, you, clearly they're not an ending quantum qubit technology, you know, uh, next to like the corner bodega, right? So, you know, I thought, gee, like maybe that's the moment, but no, that's apparently not the moment.

So it is, it is a real, it's a super interesting time right now. Definitely 2021 vibes, but I think yeah, between now and your end, you should be, you should be bullish overall. I will remind people that the thing that cracked the original tech bubble was when the CEO of Cisco finally guide it down. So again, as you're looking for when are we in a blow off top, what are symptoms that were there? It's all the like bears have given up. The fact that Rob is still trying to short quantum stocks tells you that we have a way

to go, right? Like that as like indicative and has value because he's somebody who's thinking about these things that has not yet given up on how stupid the retail people are going to be pushing this moon. They have a lot more potential power to do that. But number two is insiders start to defect from the consensus. Right. Like, let me tell you what would crush the entire market right now is Sailor comes out and goes, I'm going to hold off buying for a while. I don't like how good point goes. I'm not saying he will do that. But my point is like it's when insiders who have been part of the cycle guy down is another. I agree. When insiders say enough is enough and this is stupid and we were the fanboys all along, and we think this is silly.

So there are two points, right? What broke the dot-com cycle? One was missed Ernie's estimates and shifts in guidance to your point. That was one. The second one, like what started Black Friday, there was an article in Barron's, and it just laid out how all these expectations were just silly and absurd. And we didn't have social media then, but it went the equivalent of going viral. It was widely read article on the Internet, da-da-da.

And that was like that recognition moment. And then people said, okay, this thing is, yeah. I feel like this case, though, we need to sort of like bifurcate crypto with like tech and general traffic. Because back to the bifurcation we were making earlier, I think these things are blending together a little more. And the correct bifurcation here is certainly Bitcoin is behaving differently than a lot of the other tech stocks, right? Like I could totally see a world in which we hit this blow off top. And yet because of like the backdrop fiscally, Bitcoin and gold continued to do fine. But it's a lot of the alt coins that get erect.

So I'm just saying I would be careful about saying crypto is one thing at this point, at least without taking. Fair enough. And that's a good clarification. I was actually going to talk specifically about Bitcoin. I mean, we've all been in crypto for a long time. And I'm sure we all remember Black Thursday in 2020. I was a crack in at that point in time. And I think Bitcoin dropped, what, below 4,000 or something.

And we were all furiously just trying to buy it because we're like, you know what? Like if it goes to zero, we're out of jobs anyway. And like, let's just go down with the ship. And I was angry at Coinbase because I hadn't bought it a little while and they didn't accept my credit card. So I wasn't able to buy anything. But like there's just this religious fervor about Bitcoin that like I can't. I mean, we're all joking when you talked about sailor capitulating because there's just no that would ever happen. There's just no one like I know plenty of like Bitcoin billionaires

that have already said like I'll buy any Bitcoin at a certain price like if people want to sell out. Like it just has that that type of religious fervor. But but on the stocks that I mean, sure. And like when that unravels like that threat gets pulled out or the pin gets pulled out of the grenade when all this stuff comes down because nobody. I mean, InVidia be damned. No one expects them to be able to to cash the checks that are being written right now in terms of earnings. I don't know, but there's that saying that, like, being early is the same thing as being wrong. And how do you, how do you time that? And you still have good catalyst ahead. Yeah, Clarity Act is still coming, right? Well, still future IPOs that can happen. Like, I think

we've had one hell of a run on IPOs, and you're starting to see weak performance from IPOs, which is another kind of warning sign, like Figma had a big pop, now it's down a lot from the pop. So when retail investors get burned on those bets that the credit into, then they become twice shy. So those are things to look for. But again, it's also Q4. So they also know, like everyone's a trader now, right? So it's like, it's going to go. It's like self-fulfilling prophecy time, I think.

Is Gemini still below its IPO price? Oh, let's take a look. Because I feel like, I mean, if they are, they're like the one outlier and they're a crypto firm. Is it a ticker? I think it's Gn and I GEMI GEMI It says Gemini space station

Yeah I thought I saw it's like is that If you put it's up I think it's still up I know I know a depth But I don't know I have it It depends how you measure it

Like there's the IPO price Then the close of the opening day I don't know what it opened up at So what we're saying is it's gone sideways Right right so you got you got this You've got circle which hasn't their unlock yet. This could add future pressure. You know, the unlock is like six months. Obviously, it was a great IPO, but then, you know, you can see it still hasn't approached the unlock yet.

You know, Corweave went through this process already. It's on the other side of that. I'll show you a quick example. This is CoreWeave. The unlock date was this day here, September 3rd. See that big red line there? That was also the bottom, right? Now it's up like 30% or whatever the price changed since then. So that's going to happen for some of these recent IPOs in, call it like four to five months time because it's some of these issued a few months ago. So that puts you into like Q1 next year. Are those good short opportunities for companies, people that don't want to get caught off?

I wouldn't do it now. I wouldn't do it now. That's in the later bucket. And if you do that, you should position size very small. Okay. Or you've got to be offsetting with other stuff. Like Circle is an interesting case there because it's not clear how much of their revenue they retain long term.

Like there's a lot of competitive trends like working both for and against them simultaneously. I would certainly say it's not an obvious short. But kind of in the same way, like, so to go back to our Bitcoin comments, like actually there's a really obvious. time to short Bitcoin if it ever happens. And that's when the U.S. government gets serious about the deficit and balancing the budget. That's when Bitcoin's going to get bucket sheled because the debasement trade is over. But until that happens, that's not a thing. And so it's important to understand like what is the fundamental story here. For me, what would spook me about Circle is either rates going precipitously down because that's driving the majority of their profitability right now. Or

thanks to genius, we actually see people coming in with distribution at scale who just start absolutely clubbing them. Right. Like if Amazon partners with somebody it does a stable coin, I'm terrified for certain. Well, that's going to happen, right? They're going to internalize their own stable coin. Walmart's going to attempt to internalize as much as they can, right? The big banks, I think Circle isn't a tough position for all those reasons. Like competition's coming. So it's almost an axiom after Newton's third law, like stable coin competition is coming. I'm really interested to see what Stripe does if they decide to launch their own launch their own stable coin to sort of be natively or be native to their,

what's it called, tempo, their blockchain. I know they created a white label service to let their clients do it, but there's just so much money in running stable coins. I mean, I'm guessing they're going to take a cut of whatever white label stable coins they help create, but it seems like a very easy way for them to leverage their scale before they let someone else do it for them. They have an ability to do some things there that people like Amazon don't, though, right? Like, I'll remind everybody in the Genius Act, if you're a publicly traded non-financial company,

you're prohibited for having a stable coin without some pretty exceptional approvals that I have doubts will be granted to anybody. And what that means is so Amazon will be white labeling somebody's stable coin and or just using somebody else's. And by the way, that's not to say they're not going to strike a deal like Coinbase has. circle to take a huge amount of the economics. I think they totally will because the lesson of stable coins so far is but distribution is king. But what it also means is these things are going to be more either interoperable or fungible that people expect. We're really building another base layer for money back to my earlier comments on 24-7 money movement. And so as you're looking at where the value accrues and part of why I look at circle and I'm like, I have questions is I'm not sure that

goes to call it the public utility layer, it might end up going to it. I 100% agree. So Amazon will pick a coin other than circle because Amazon wants to be a super app. Coinbase wants to be a super app. So they're competitors. Yeah. So you're right. And you're right.

Austin's right. Amazon will king make some other stable coin issuer. Who is it? Is it a Paxos? I don't know. Those are interesting things to think about. Like maybe it's Paxos. I don't know.

Like or de novo entity that is focused on meeting the needs. of Amazon and their peer groups. Maybe Amazon will just auction off the ticker AMZN or USD AMZN and then just see what happens there. All right. So one other thing I wanted to ask about, maybe Austin, this is again, I want to start with you, Coinbase applying for a banking license. What's the play you see there?

So I will note specifically Coinbase is applying for a trust bank license. Like it's important banks are not. monolithic. There are a lot of different subspecies within the family, so to speak. That to me feels like Coinbase is looking at custodial applications. They're looking at clearing applications. And if you're a company that's expecting everything will be tokenized, you're like, yeah, and I want to be the guy holding all that stuff or like doing all of the transit work. This is exactly the kind of license you would get. They're not going to become an IDI, aka insured depository institution. where they're going to be going and getting FDIC insurance and like taking tail deposits through

that thing. So like, let's be very specific about what they're doing there. But it tells me, back to your super app point, that Coinbase is thinking of themselves is how do I start getting myself into the conversation of taking our sort of 1970s era paperwork crisis band-aid solutions and massively upgrading them? I want to be standing in the nexus of that. Do you guys have any thoughts Josh or Ramad? Yeah, I agree. Look, it's a payments play. Brian Armstrong, CEO of Coinbase has always been focused on payments. And I think the OCC license helps them in payments. There's 200 other fintechs that won an OCC charter too. It's a highly coveted thing. And the administration will be granting dozens of these OCC licenses. A few years ago was just Anchorage. I think one other

bank that got the OCC, the think about how hard it was. to get an OCC chartered. Now you're going to have dozens and dozens and dozens. And I think they're trying to issue as many as they can before the midterms. So if you want to get something done with the bank and a bank license, now's the time. Yeah. Yeah.

One of the thing that caught in my eye, too, Galaxy kind of launching a retail focused, like trading and savings app. That wasn't something. I guess maybe I was mistaken, that wasn't something and I necessarily saw my bingo card. They have a... What's going on there?

What's going on there? I don't know. Or your retail or you're both. Or you're an AI data center company. The Galaxy story is, first of all, it's been a great asset. It's done incredibly well. Like hats off from like Novigrats on the team. We have many favorite people there like Alex Storm, who's been on the show,

we'll have that guy again. But there's so many things going on here, right? You can tell it's stormed by a trader. These are traders operate, right? Traders like, how thing go? AI data center, Bitcoin Mine, I think let's get that one too. Retail trading app. I'll have some of that.

When can I issue a stable coin? The trader on organization. Yeah. Yeah. So what we're saying is Galaxy is the super app. I guess they're trying to. It's curious. I mean, they hired Zach Prince a little while ago.

I mean, I mean, that's under a BlockFi. Yeah. This is kind of like what he did at BlockFi. And I mean, notwithstanding everything that happened with BlockFi, he built a really good consumer brand that have a lot of loyalty. And so I wonder how much of a role he had in putting this out. But it costs a lot of money to build, I mean, not to build a retail brand, but to actually market it and get that client base.

I'm curious. I don't know what the brand dynamics were of that and how, like, how that they're they have shareholders. And the shareholders can be customers. And this is what we've seen with Robin Hood. Customers are shareholders, shareholders, a customer. It's read right of. Well, I think it's a little different, right?

This is maybe more akin to like Goldman Sachs trying to launch like a retail operation with the with, you know, acquiring like retail deposits and the credit card stuff. Which like, I don't know. I think if you ask like people internally at Goldman, I think it's like pretty mixed reviews. fundamentally well. Oman's Marcus foray into retail is a complete failure in disaster. They could go back in time and not do it. They would.

the company car business that they do with Apple to Citibank. It was off customer. It made no sense at all. But that's the analog, right? Like if you talk to Nova, that's what he thinks of Galaxy as the goldman of Crittier. But I would pause people here and remind everybody part of why Marcus was such a fiasco is something Galaxy doesn't have to deal with, which is the entity segregation rules that you're dealing with for customer to pass up taking with Europe bank. like that is one that I think is very, very niche because unless you're a very specific kind of commercial bank that also has a large trading arm, it's hard to wrap your arms around how brain damaging it is to try to do that thing. But like, people who had done that kind of looked at Marcus from day one and are like, what is it going to do with like, does Goldman intend to build a consumer webbing franchise? I'll tell you what, though, Austin. I was at Citibank when they announced it.

I was in cities like retail bank and people were scared because the, I mean, notwithstanding everything you said because they know how banking works and, and how things have to be segregated, but just Goldman's brand as being like the smart person investment bank where like they could pick whoever they wanted for business schools and stuff. And now they're getting into retail and that's where the money is going to be made. This was like what, 2018, 2019, whatever was they launched it. People were nervous about that.

did not be a huge fiasco like it was. I will contra that and say somebody who's quite senior in J.P. Morgan, who's a friend, texted me the day the Marcus announcement came out, and the exact vote is they're going to our grant. Yeah, I mean, it was a complete failure of execution. I mean, I remember those original slides. They were forecasting a return-up assets of 3.5% from that business, never came close to that. Complete failure. It was ego over kind of humility.

But back on Galaxy, so I hear your point, Josh. You're saying, look, doesn't Novo hold Galaxy out as Goldman for crypto? Look, Galaxy's a meme stock. Why current shareholders adopt B app? That's all I'm saying. Okay. All right. So good discussion.

Let's start to wrap up. Josh, one of the things I like to do when I get to host is ask all of my panelists to kind of either share something that was left on the cutting room floor or just a contrarian opinion, something that they'd like to highlight. Curious what you think. Or, again, as Ron was saying before, you really have a visibility by being a Falcon X into what the smart people are doing right now in this market.

Would love it, perhaps, if you could share, like, one or two things that maybe you're seeing, especially if they're not obvious tokens or strategies. Sure. Yeah. I mean, I think I got a lot of questions while in Asia, you know, how does this all, how does this cycle end? And I think it's going to be pretty different than last cycle, right? So if you think about last cycle and, you know, coming back to BlockFi and the question and, you know, of retail deposits, basically funding, you know, larger trading operations, that was the main. kind of downfall for the last cycle is that the leverage that was afforded by retail deposits

in sort of like undersecured lending, you know, that became like pretty endemic to crypto. And I think this cycle is going to be pretty different. And also if you think about last cycle, like, Defi was sort of untouched in a way. Like, defy was pristine and, you know, performed the way it was intended to, you know, things like Ave worked just fine, you know, throughout the process. of unwinding the leverage. I think this cycle is going to be different. And I think it's going to surprise a lot of people. But things like DATs are not inherently that levered.

There are some of the treasuries that have converts on them. And people raise that as a point to say, like, this is kind of concerning and it's going to be the cause of the next cycle unwind. I kind of don't believe it. I think there are some of these equities that do carry debt. but they're being underwritten by banks, and there are sophisticated investors that are buying those converts. So there is some underwriting standard being applied there.

And the vast majority of that's will never be able to issue debt because nobody will underwrite it. So I think that's actually not the cause of the next unwind. I think it'll be actually in defy. So what's happening now is a lot of strategies that are sort of like actively managed strategies that are a little bit less transparent are getting put into tokenized formats. So either through like fond tokenization platforms or, you know, explicitly as vaults or even, you know, in some cases being issued as some kind of like a stable coin wrapper.

And these things are then being put through looping strategies, right? So, like, people are going into something that's maybe like a 10 or 12 percent yield, but they're borrowing something, they're borrowing USC at, let's say, like, 7 percent to loop that strategy up to something like 20, you know, 25 percent yield. So when it turns out people are become aware that these are not basically like risk-free strategies, I think basically, you know, there's going to be a ton of leverage built up. into some of these trades. And that will actually be how, you know, the de-leveraging happens this cycle.

So it'll happen actually in D-Fi is it'll be like the same sort of issue, which is like underwriting standards being, you know, de-based in a way. And I think it'll be because people will be using bad forms of collateral in the forms of some of these actively managed like tokenized strategies. Interesting. Ram, how about you? Yeah. Yeah, look, I agree, by the way, Judge Rosh, always, always right on the mark, too.

So banks are reporting in two weeks. So I think getting ahead of earnings season is a good idea. We know mortgage refi picked up. A lot of ways to express a view on that. Wells Fargo is a leading mortgage originator that looks set up well too. But I think broad base of financials will report and they will crush earnings. Austin also spent a lot of time at banks. And every quarter of these banks just crush earnings.

And what happens is midway that for the earning seasons have moved down to other topics that kind of trade time again. But like the deregulatory backdrop around banks is strong. The consumer is strong. We saw GDP clock in strong. Ernie's growth the last quarter was strong. There's a lot of good things happening out there. If you can kind of look past the dumerism. So I think that's an interesting idea and not just tactically, but also as a strategic investment.

All right, Dr. Campbell. So I'm going to leg on to what Josh said and say the kinds of things that, quote, unquote, stop this train in times like now are actually unexpected, really bad breaks. Honestly, I think people are watching a lot of defy and prepared for that. But one of the areas where crypto has definitely not learned their lessons and continue to do stuff that we know not to do in some areas of the traditional financial system is like single point of failure risk. So, like, understanding how sophisticated, by sophisticated, I mean incredibly sophisticated, some of the threat actors are out there at this space. The kind of thing that's going to break the crypto rally badly is like North Korea compromising like tether circle smart contract.

Right, just minting a trillion dollars buying all the assets and like sweeping into Bitcoin. Because that is, I want to be clear, that's the kind of stuff they are actually trying to be right now. And I curiously, why would they use the fund their nuclear program? Why would they? So the answer is if you're a truly nihilistic group of people who are only motivated by getting a big score because that's how you get whatever you want, you go do that. By the way, you'll notice the North Koreans have a strong preference to taking whatever they successfully capture and getting it into Bitcoin as quickly as possible. Right.

If you look at how they've swapped things cross-asset, what they exchange. change things for if they get stable coins, if they get something else, they're going to swap them. And so I would just, I bang this drum before, but I'll say it again. There's a lot more single point of failure risk in elements of defy than people. So Bitcoin is the primary FX reserve for North Korea? Wow. I mean, they don't think. Thank you. So, Austin, do you think we could get a private key compromise from a major party? And that would be a kind of a left-tail risk people i mean that's what i'm saying is a good example of left tail risk it can't really if you had that because if you would that would end every like the dats they would all crumble i mean everything

would be like it would be like i'm well i'm actually speaking it would also end defy right because think about it every blank against us dc pool is now if u sdc gets compromised all the bridges etc and that's why i like raise it because if you look at the governance structure of a lot of these chains, if that happens up like Ethereum or Solana, they functionally don't have a way to do anything about it. Right? Like, there may be a hand, like, you know, for all that people make fun of them for being a zombie chain to raise one of Steve's previous victims. Like, there are structures on like stellar avalanche where you can have coordination very quickly between certain kinds of validators to stop that. But most chains are not centralized in that way. I'm actually speaking at a quantum computing conference.

in I think a week and a half or so ago, which I think is kind of funny. Hold on, is that the one that was above the Bataga? What? I was like, was that at the headquarters that was above the Verbega?

And I always think it's kind of funny because I think you've got to see in computer science at my freshman year at Carnegie Melling. But, but, but you know, it's hedge for crypto, right? Like, if they crack quantum computing

your quantum stocks to go through the roof, your Bitcoin. Yeah, like, if they, if they, A terrible idea about it. And it can compromise, like, private keys. Like, that's going to end, like, all privacy, like, finance, stratify, crypto, everything.

So, defy it will be the least of our problems. For me, I guess, just the last thing, I saw a couple announcements today. I think, like, the Winklevoss twins put money into a debt. Like, I've still seen a couple of, like, smaller announcements on debt. And I'm really curious, the, like, especially for ones that aren't, like, associated with, like, a long-tail asset, which, I'm already pretty bearish on. I'm really curious, like, what's the thought process behind some of those at this point? Like, now, okay, pay it to hold on, pay attention to how people are contributing to those

because one of the things driving the debt proliferation is, as is always the case in all markets, tax harm, right? Because if I've got Bitcoin with a very low cost basis, I could contribute it to a debt in kind, get shares back and go borrow against those shares from sources that I can't borrow against in crypto. So that's a very favorable trade for some people where they're not really expressing an opinion on anything other than I don't like. Yeah. And I guess with the assumption that the premiums won't drop below one or through. It's not that it won't drop below one. It's just that it needs to not go so far that you get liquidated on the loan. And sort of given the fact that if you

are a shareholder, you can be your own activist in some ways. That seems pretty doable. Otherwise, we didn't get a chance to talk about it today, but obviously, Grayscale started launching staking for their Ether and Solana ETFs. I don't, I'm not a lawyer. I don't, Austin, are you a lawyer? I'm not sure. You have so many, you have this professorial look. I almost assume you want. But no, we got to get James back. But we're going to, I think we all expect in a couple of weeks,

we're going to see a lot of staking comes to ETFs. And we're going to have to discuss what that means for the market, but also especially for debts, especially like, and Solanidats because their hurdle rate, I think quote-unquote, is about to get a lot higher. But with that, thanks Josh for joining us. We'll definitely have to have you back, Ron and Austin, as always. Thanks everybody for watching and listening. And we'll be back next week with another episode of Bits and Beps.

All right, that's it for this week's episode of Bits and Bips. Now, for the second half of our double feature, we're turning the spotlight on the Onchained 5. I sat down with Ryan Yee, who authored a three-part series for Unchained, laying out the five companies that are quietly leading the next wave of crypto adoption. Here's our conversation, and remember, you can find all of these articles in the show notes. Don't forget to subscribe to our newsletter. As these bets start to pan out across these five companies, it's going to become clear to the world and a lot of the other tech companies that it's actually table stakes to have a crypto forward strategy and an on-chain strategy. And if you don't, you're going to be left. behind. Hi, everyone. Good afternoon. My name is Steve Erlich. I'm an executive editor here at Unchained,

and I am with Ryan Yeh. Ryan wrote a terrific series of articles for us called the Onchane 5, and we're going to share them with you and break down some of his key conclusions. But before that, Ryan, hello, welcome, and why don't you just briefly introduce yourself to the audience? Thanks, Stephen. Yeah, my name is Ryan, been on the show before. But, Just a quick background is started mostly as a crypto investor. So spent some time at Coin Fund as a venture investor there. And then most recently it was over at Coin Base Ventures building out their investment practice. Okay, great.

So why don't we just start with sort of the origins of this project? I mean, why did you decide to sort of like list out what you kind of saw as the five, the OnChane Five? I mean, the five companies that are really going to, define sort of the next level of adoption in crypto. And in your first article, one of the things he wrote was that distribution is going to really be the defining variable given where crypto is in its current level of adoption. Walk us through that, please. Yeah, sure.

So I think a lot of the genesis of this was just based on my observations while I was over at Coinbase. what became sort of clear to me was that there are kind of two things. One is there's massive sort of leverage that is created when a centralized company actually uses on-chain technology. And so, you know, one of the largest products at Coinbase is USDC, which is a USDC stable coin. And it's one of the largest sort of money generators in crypto. But that is not built by a decentralized team or a decentralized product, right? that is built by a centralized team, effectively issuing a product that is used by the entire crypto ecosystem.

And so I think one truth was that there's massive leverage of centralized companies using decentralized technology. And then I think secondly, it kind of became clear as I was talking to a lot of startups in the ecosystem, you know, who wanted to chat with Coinbase and the Coinbase Ventures team that they really wanted to know how to learn how to sort of have our users, and have our services interact with their protocols and decentralized technology. And so I think the combination of those two things kind of really led me to this belief of. I think there was going to be this era where companies are going to start to really invest into on-chain products,

especially the big companies that already have users and liquidity and partners. And so the thinking then expanded into, hey, like, you know, obviously I'm very familiar with that where sort of Coinbase and Base are going to go. what does this mean for sort of the broader ecosystem? And I think as I was thinking through this, a lot of the news around Robin Hood and Stripe and a lot of these others start to come out. And so I figured, hey, like, maybe this deserves its own piece of literature

and we should explore this. Yeah, that makes a lot of sense. And certainly seems appropriate given sort of the support for it was getting in Washington, D.C. And as well, I guess just this unprecedented level of attention that is being heaped on the space, especially from some of those big,

I don't know if stratifies the right word, but maybe like traditional fintech companies, if that's not a misnomer. So it certainly makes a lot of sense. Let's dive in each one to just sort of explain the thought process and some of your key takeaways from the companies. You did a nice job in the articles of providing an overview of sort of the strategy so far, how they're trying to leverage blockchain technology in different ways. That's one of the things I liked about the article. Every company is using crypto and blockchain in a different manner. And then you also highlight some risks associated with each company too

on why they may not fulfill those expectations. Let's begin with Coinbase. Everyone listening here, I'm sure, has heard of them. They are the largest U.S. exchange. They're a massive custodian. I think you call them like Uncle Sam's on ramp because of this sort of pristine type of image that is created for itself. But beneath the surface of its massive centralized trading platform and custodian system or custody system, I'm sorry, is base. There are proprietary level two blockchain that you sort of explain is going to be a launch pad for a whole ecosystem of financial services.

So talk about that, please. Yeah, sure. So I think it's important to understand what Coinbase was before Base. So Coinbase is effectively a centralized financial services company for the crypto ecosystem. And so what that effectively meant is that a lot of the sort of crypto utility that Coinbase was allowing its consumers to actually interact with was mostly through trading as well as custody and related sort of. products like that. But I think if you look at sort of the vision and the mission of where Coinbase is trying to go, I think they really do believe that there's a lot of different sorts of actions and ways in which consumers are going to be interacting with crypto.

And so this might be called things like crypto utility, things like, you know, crypto has applications and so forth. And so I think, you know, that of Genesis of Base really makes sense in that context because it allows Coinbase to have its own platform where it can really drive its users to interact with this technology, but they can also invest into making it as seamless as possible for the sort of existing Coinbase user base to interact with on-chain technology, which, you know, as we all know, can kind of be a little bit cumbersome and scary if you're not sort of working in this industry full-time. And so, you know, they've gone on this journey now. I think the experiment is definitely working.

But I think the core question I was asking myself is, what does on chain uniquely solve for for Coinbase in this aspect? And I think the biggest takeaway for me at least is that it really helps them scale this concept of financial services that would otherwise be a little bit not scalable or just a headache to deal with because on chain technology is actually a much better alternative compared to trying to build this out than maybe the centralized option. chain, close source kind of way. And so, you know, I've highlighted a couple of examples of products, whether that's, you know, Bitcoin back loans. They obviously announced crypto lending recently for USC. And then I think they also announced dextrating. But the core idea of this is effectively that, you know, Coinbase doesn't actually have to, through its own infrastructure, build the liquidity for all of these services. They can actually bootstrap and use a lot of the liquidity that exists on chain and basically use these protocols or interact with these protocols

that have that basically the hard job of bringing the liquidity and managing all those things. And then Coinbase effectively just provides a simple front end and the service for users that want to interact with these size of products. Got it. So two things from Coinbase that you raised in the article, I want to ask about, for one, for years, the company had maintained its stance that there was going to be no base. token. That's obviously not changing. And it also coincides with sort of, I guess, a reimagination of their non-custodial app base into, I guess, what they want to be like a fully, a full-fledged,

like all-in-one financial super app. Is there a relationship between the announcement of the token and this app? Or have you had a chance to play with the app? I know that its waiting list is, I believe over a million people long. So it's pretty massive. And what might all of that do for an L2 that is growing, but still does not meaningfully impact Coinbase's bottom line financially? Yeah. So I think these things are definitely related.

So the way that I would think about sort of the app and the token and also just like the general Coinbase interface is in three ways. So I think in the general Coinbase interface, there's products that they are launching, which still feel very much like typical financial services that a consumer would use on top of like the traditional coinbase.com. So things like loans, things like lending, things like trading. But it's just on chain, on base that is powering a lot of those things right now for them. So I'll put that as, you know, an existing user on Coinbase is familiar with that type of products

and wants to access those things. It's just point of base finds that using on chain on the back end is just a much more affords way of doing that. I think the second thing is, yeah, the, the wallet app, TBA. I think that's meant for effectively any user that wants to interact on chain on top of base. So you don't necessarily need to be a Coinbase user. You can be, you know, anybody that has access to an iPhone or the iOS store or the Android store. And, you know, effectively you could download this app and start playing with things on chain.

And so this type of utility or types of applications that you might want to interact with on top of base, I would imagine that this is probably the right consumer application. for that type of consumer behavior, although you probably still interact with a lot of the DFI things that are on top of base through that app as well. And so I view that almost as a customer acquisition funnel and a user funnel. And then I think the token is quite interesting. There's not too many details out there obviously yet.

And I think I recorded an episode with Unshamed, maybe a couple weeks ago, kind of giving my thoughts on that specifically. So if people want to hear more there, they should listen to that one. But I view that as kind of, the way in which you can get a lot more attention on the developer side and generally on the user side to start doing transactions and play things on base, especially if there's a potential sort of reward or incentive structure in the future. Got it. Thanks for that. Before we move to our

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at the APTOS Experience, October 15th to 16th in Brooklyn. All right, so we're back. Company number two that you listed, and I think it's important just to remind our listeners and viewers that there's no particular order to this list. It's not like Coinbase is number one and so on and so forth. It's five, top five, or I guess five, unranked. But the second company that you profiled is Robin Hood. And some of the statistics for Robin Hood were pretty eye-popping. I mean, for one, when you published this particular story, I guess maybe two weeks ago or so, the stock was up 400% year-to-date, over 400%.

And the vast majority of that I think comes from excitement over crypto and crypto trading. I mean, Robin Hood had its start as sort of just focused on Tradfai and payment for order flow and new stocks, et cetera, but it's very much a crypto company. And now it's leaning into that identity even further. So why don't you walk us through some of your key findings with Robin Hood? Yeah, I think Robin Hood's view is that it's kind of two ways, right? So I think one is competing as basically a traditional crypto exchange. So, you know, they continue to list crypto assets on top of Broadhood that people can trade.

They also acquired Bit Stamp over in Europe to effectively allow European liquidity to form. And BitStamp is a European-R-P exchange. And so I think in that way, I think about in traditional terms of them competing with the Coinbase centralized exchange products. And so I imagine that they continue to invest more because it's a much bigger driver of growth for the business now than it was before. But I think all the other things are much more sort of medium-term and into the future. which is really sort of leveraging on-chain technology as a better backbone for the types of financial services that they want to offer in the future. Right.

And so, you know, if you open up Robin Hood today, they actually offer a ton of financial services that, you know, would look, thing, what will look very similar to like a traditional financial product. So things like options, things like, you know, pre-IPO products, things like secondary trading. I believe they even listed prediction markets. I was at the Ryder Cup a couple weeks ago, and I could bet on the album of the Ryder Cut through Robin Hood, and it was powered by Cal Sheet, which is another prediction market company.

What's been interesting about that is, you know, as you are trying to offer these different types of financial services, you just tend to increase the level of complexity of the infrastructure that you actually need to build to service those things, whether that's partnering with external market, makers or strategic partners or whether it's literally just like an internal financial system that you're relying on in the traditional rails that may make that thing, you know, actually hard to actually manage a scale over time. And so, you know, when I saw their announcement around

Robin Hood and their tokenized stock and their stock tokens, I think that that was kind of their way of saying, hey, like, this might actually be a better back end for the types of products that we may actually want to offer in the future. But consumers are not going to really know the difference at the end of the day. Right. And so a consumer will still be able to do things like, hey, I bought the stock. Maybe I want to do stock lending. There's a traditional way of doing that.

But the crypto-native way of doing that is, you know, we just wrap this, we tokenize it and then we stick it into some D-Py protocol on top of Robin Hood chain. Right. And so it begins to form this sort of long-term vision of how Robin Hood chain actually becomes this settlement layer that is actually much more efficient in terms of allowing the types of financial services that Robin Hood actually wants. offer in the near future. And I think what that then does is it could potentially

sort of impact a relationship that Robin Hood has with their intermediaries and other people like broker dealers and market makers to then sort of cohesively move into this one ecosystem and create more sort of interesting or creative ways in which they might work together. One question that immediately came to mind that I know we discussed it in your story is what does all of this mean for the feature of a PFO payment for order flow? which is how Robin Hood built its business. I mean, I guess if they're able to tokenize stocks

and put them onto an ultra-fast L2 on top of Arbitrum, is there the same need for them to rely on the citadels and Susquehanna's of the world? Because BFFAR is certainly a controversial practice. Yeah, I almost think of it, like, if I had to use prudonative terminology, like, you know, the traditional way of them doing this is that they effectively generate some flows on the user side,

and then they effectively sell this privately to different market makers and partners that they have. And they monetize in that way, and therefore they're able to offer zero commission training for their users. I think the way that PFOP might sort of transition into the future is that, you know, that basically just gets baked into the economics of Robin Hood chain. Right. And so, you know, it could actually turn out that, you know, traditional words that we use like, you know, MEP and the Mempool and things like that,

you know, I almost view that as just like the crypto-native version of a P-Path. And so you can imagine a world where all sort of trading and all sort of tokenized assets begin to move into Robin Hood chain. All of their partners start to do market making and actually play with these on-chain financial services, much of what they're already doing anyway for Robinier users. It's just like one step sort of detached. And then through that, maybe Robin Hood starts to experiment with, hey, like, maybe you pay us like a subscription fee to actually sit and be one of the validators on Robin Hood chain. And then that effectively is a form of like buying a seat to order flow.

It's just that that order flow is represented in some technical fashion that looks like something like an MEV or something like that. And so I think these are much more sort of conceptual ideas. I kind of want to wait and see like what's going to happen in practice. but to me that seems to be like a potential natural evolution of their business model. Yeah, that's interesting. I mean, the idea of them almost paying to be like a validator, I guess a sequencer in like L2 nomenclature. Although the ironic thing is that as far as I can tell, basically every major L2 is fully centralized at this point, even base with just a single L sequence or operating it. So I think a lot of the hope for base and I guess Robin Hood, the aspirations are relying on actually decentralizing these networks.

over time. Just one more quickly on Robin Hood before we move on. There are lots of numbers being thrown around about the potential size of the tokenization market, billions and billions and potentially trillions. And I wonder, where do you see the real low-hanging fruit or the sweet spot for Robin Hood? I mean, they can tokenize stocks of Apple and Tesla, but those are already pretty liquid markets. I know companies have been trying to offer access to like tokenized private equities for years. Robin Hunt got into a little bit of hot water with derivatives that, that quote unquote track the price of Open AI and SpaceX. What do you see? Yeah, I really think it's three things. So one is, I think yield offerings. So, you know, I think through, you know, stable coins and related

products like that, I could see, you know, Robin, I think they offer some version of this already, but effectively using on-chain to offer a better version of that seems like very low-hanging fruit to me. What's been kind of interesting to me is like that secondaries market, so that pre-IPO market. You know, I think actually Robin Hood today does offer the ability for users to participate in IPOs. Obviously, like it gets super filled and like the amount that people want, it's almost never the size that they're looking for. But it kind of goes to show you that, you know, I think the private markets are, there's just, so much money behind a lot of these companies, obviously, you know, all the AI companies, minus Invita are all private right now. And so, you know, that's definitely like a hot area

currently. And I know that retail definitely wants to participate in that. I think, you know, the open AI stock token thing, yeah, there's some news around it, but I think conceptually it's the right idea because I do think that is a product that users probably want to interact with them. So I'd imagine those are the two things. I would say long term, it would be interesting to see sort of how they start to meld. different types of traditional financial assets with like, you know, crypto-style products. So can you build sort of perpetual features or purpose products for, you know,

things that look like traditional assets and things like that? Got it. Okay. So let's move on to, I guess, I don't know if controversial is the right word, but I think the one company that has certainly gotten the most conversation going in the last few weeks or months, Stripe. And the news that Stripe was going to create, or I guess it has already created its own blockchain tempo that's really designed to be focused on stablecoins.

This fits into a broader, I guess, movement of like, of stable coin companies or payments companies launching their own blockchains. I mean, Tethers kind of doing the same thing, circles launching its own blockchain, but stride because of its massive scale and network effects, launching their own chain is forcing people to pay attention. So just briefly, in case there are some people who aren't familiar with the Stripe business model. Can you explain exactly how they process payments and what they're looking to do with a new, I guess, vertically integrated blockchain tech stack? Sure, yeah.

So, you know, if you're an online business today or even an offline business, but Geno is speaking in an online business, I think it's pretty, you know, if you ask, one of them, like probably nine out of ten of them are using Stripe. And so, you know, the way I look at it is that Stripe effectively, is a payment processor, especially for these sort of online native companies. And, you know, they've been building this for many, many years now, and they've built, like, this huge scale. But if you look at all the sort of infrastructure that they're running on, it's all legacy

style products, right? And so they still rely on partner banks. They still rely on, you know, credit card partners and all of these things. And so if you're a company that's on Stripe's platform, I think that, you know, in terms of, like, money in, in terms of like money, sort of in money out, you can use it on Stripe. But any other sort of financial service, like whether it's like capital management, balance sheet management, you know, other sorts of services that they might want to offer, they probably need to go and like, you know, use a bank or use one of these other people

in terms of their sort of traditional sort of business workflow. And so what's been interesting about Stripe is that, you know, there's a graphic and it's part of the article series. But, you know, if you look at all the bets that they have made, they're effectively trying to tackle all the areas where they could basically bring these things on chain and effectively have businesses never actually leave the Sprite product or the strike network. And so, you know, those three bets are effectively, you know, privy. So do we have a wallet layer for effectively businesses to hold assets like stable coins or otherwise?

B is do we have basically a layer that is able to map sort of off ramping and on ramping into crypto and in to banks. I would basically say bridge is the infrastructure that allows for that thing. And then third is, do we have a native chain that we have that is purpose built for our use case, which seems to be payments. And that's why they're incubating a project like Tempo right now. And so it seems to me like they're making these sort of three different bets, which, you know, if you sort of tie into all, tied the strategic vision of how these three things fit into, you can almost view this future world where Stripe sort of is running on chain, and it's just a much more, a, an efficient way for them to actually grow,

but also B, offer a better product experience for their customers, and then see actually get much better margins through offering new types of products and not just being kind of one person within the flow of traditional payments flow. I think one question that immediately comes to mind, especially you talked about the acquisition of Bridge, which I think at the time was the biggest acquisition in the history, history of crypto, 1.1 billion or something like that. Many people associated with sort of being a white label stable coin provider or launch pad. So companies on Stripes platform can launch their own

stable coins. But given how profitable stable coins are as a business, I just look at Tether's profitability, CERC, gangbuster IPO, the question everyone's going to have is, is Stripe going to launch its own token. And if it does, what does it mean for all these other companies on the network that might be thinking of doing the same? Yeah. So I think they announced something last week called open issuance. Maybe I'm getting the name wrong, but effectively this is exactly that tool where basically if you are on top of stride, it's effectively a one-click experience where you can effectively issue your own stable coin. And the benefit is clear. It's like, you know, You can generate yield.

You can do all sorts of things that, you know, the benefits that stable coins effectively bring to your business. And so I think that's very much in line with how sort of stripes, you know, business and product DNA is reflective of, which is, hey, can we offer this experience to our customers, which is effectively one click and giving them everything that they need in a box, right? And so I think my view is like that is a very smart strategy because it effectively allows their customers and their businesses to start to understand the benefits of on-chain. Whether Stripe launches its own stable coin or not, I think, is a TBD question.

I don't think they need to because I think there is a world here where you have all of their merchants effectively issuing their own stable coins through Stripe, but those stablecoins effectively get issued as assets on top of their own blockchain tempo, which they already own in terms of the stat. And so I could see a future, more probable future here where they have their own chain, which is tempo, and then all of their partners that are issuing stable coins are issuing stable coins on top of their chain. And I think that's probably a much more interesting model for them because then they don't

have to actually introduce their own currency and potentially be perceived as like having conflict of interest with all the clients that are on their platform right now. Yeah, that makes a lot of sense. And I guess also maybe it comes down to the negotiation of these agreements. I'm sure with the ease of a one-click issuance, there is probably some sort of management fee, et cetera, that will go back to Stripe as compensation for doing that. And then, I mean, same thing, too. They announced a partnership with Coinbase and Base to allow merchants to accept USDC from Base too. I don't know.

I would imagine they're probably not doing that for free or maybe now they're not going to be doing it. for free for much longer because I don't think they get any money from from base and the I'm sorry from from USC and the yield generated from it so it will be interesting to see but that idea of sort of being a neutral party I know that's something that tether values circle values it as well and we'll talk about a lot of the big Wall Street banks potentially issuing their own tokens on their own stable coins they they're going to have to sort of deflect that narrative so that certainly makes sense with what you're saying. Okay, let's move to the next one.

I found this particularly interesting because I wasn't very read up on the finances of Telegram, but the company mentioned was Telegram very closely associated with the Ton Network and the Ton token. And this one was particularly fascinating to me because you made the argument that the Ton token is really a financial necessity. necessity for the company to keep moving forward.

So why don't you just walk us through that before we get into everything that they're trying to do to build a whole developer ecosystem on top of time? Yeah. So I think where the core of this came from is telegram is a very, it's a very unique asset, I think, among tech companies, because number one, most of their users are known in the U.S., right? So it's primarily an international product. Obviously, folks in crypto in the crypto ecosystem are super familiar with Telegram.

But if you ask most people in the U.S., they actually don't use Telegram, right? And so I think there's this interesting sort of geographic aspect where Telegram is really huge, but it's huge in places that maybe typically in Western economies, they might not realize how big it is, right? And so it's a huge asset. I think it's like 1 billion monthly active users. I think the second unique thing about Telegram is that it is kind of like a non-traditional tech company in a sense where they haven't really done that, you know,

traditional sort of life cycle of raising equity, you know, growing, creating profits, creating revenues. Like I think a lot of those questions have basically been kind of delayed because they were so focused on building a product that is very in line with like the founder's philosophy, right? And so, you know, if you see interviews with Pavel and how he kind of talks about his own views of like, freedom and things like that. It's very clear that he wanted to create a product that was kind of different, right? And didn't really rely on that sort of traditional monetization model where he's basically

making money off people's data and things like that because I think that's basically what he believes in, which I think is, yeah, that's what he believes in. And I think that's great. But it does come at the cost of sort of running a traditional business model. And also it does come at the cost of kind of going through traditional financing, life cycle and process. And so if you look at sort of telegram's financial situation now, there's really two things to pay attention to.

One is that they only started to really generate revenue in like the past two years. Right. And so, you know, things like telegram subscriptions, things through gifts, you know, different ways like they're experimenting with. And, you know, I think they've like generated like a decent amount of revenue, but this is something that needs to grow over time. And then the other is like the cost structure, right? So running telegram, running service for a billion people, like that, that costs a lot of money.

And so how do you sort of finance that? I think to date, they've basically raised money through debt vehicles from different sovereign wealth funds to basically manage that. And so they're kind of in this game where they raise a bunch of debt to make sure the company is, and the product is continuing to run. Yet at the same time, they also are starting to experiment with monetization. And I think there's always going to be some delay in which like how much they can actually cost, basically meet their cost of financing while also driving growth and value back into the telegram ecosystem. And so, you know, I think the ton token is extremely interesting because it offers them kind of an alternative path where it kind of can address both of those things. Right.

So on one side, you know, if you have, you know, Ton tokens on the balance sheet, obviously you can use that as a financial lifeline. and, you know, use that as a way to basically finance and finance yourself and your operations. At the same time, I think there are also interesting ways in which you can start to implement ton as sort of this growth driver and value driver within the telegram ecosystem, which is the other sort of thing that they've been doing on the side. And so, yeah, I think telegrams are really interesting company because, you know, the founder has his own views on sort of freedom and his own philosophy there. And it almost makes perfect sense that, you know, he is looking at crypto and tokens as like, you know, what are the past that is actually aligned with how he wants to view like the outcome of his company where he doesn't necessarily have to rely on sort of the traditional rails and the traditional, you know, sort of capital markets for the business that he's trying to create.

Yeah, it's really interesting. I mean, I actually got first involved in crypto 10 plus years ago. So the first story I ever wrote was about how blockchain technology could help companies better align with what was at the time forthcoming European data protection laws. And as I've chronicled a lot of different companies along the years, I mean talking about like Zcash or NIM, private payments or private VPN, etc. The monetization problem has always been a problem. These are projects that perfectly blunt I root for. but at the same time, like their token struggle, usage is very low. I mean, Zcash, the vast majority of transactions on Zcash don't use their shielded addresses,

which is the whole point of Zcash. And NIM has been trying for years. So, I mean, TAN is not, doesn't offer the same level, or Telegram doesn't offer the same level of privacy as those products, but it is still in that privacy family. And so I can appreciate the financial struggles with something like that. And it is interesting and pretty clever for them because they, unlike those other products, they have the brand recognition to really leverage a global user base to try to generate lots of funds.

Two questions I had before we move on to the last company, though. In what has been a pretty bullish year for crypto, the Teton token has not had a good year. I think when you wrote the story, its token was down somewhere 40 to 50% year to date. I'd love to just kind of get a thought from you as to why and what that might signify. And then two, if there's anything that I knew you pointed to a couple of examples in your story about some activities happening on time that you're pretty bullish on. Many people who just casually follow the blockchain might only think of the Time or the Time Network as sort of the place for this push-to-earn games that were kind of had a fad moment,

maybe a year or two ago, I forget exactly if it was 23 or 24. But can you just briefly address that? Yeah, I mean, you know, I'm not, I don't know like the story of every day or every week of what happens in the token. But my theory is a couple of things. So I think one is, you know, somebody was asking me, what percentage of telegram users are actively using on-chain applications? And I actually don't know what that number is. And my guess is that that's still quite minimal right now. I don't know what the number is, but let's just say it's like 5 to 10%.

And so what that really means is that, you know, the majority of the telegram user base has not actually sort of contributed yet towards usage that is translated on top of, you know, any other stats that is running on the ton network, right? And so I think that's probably one thing. The second is, you know, there's kind of this feeling of, you know, when you have a major asset like that, how much of the present value is baking in the growth or expectations that Telegram is already

backing this thing versus how much of that growth do you actually need to actually demonstrate, right? And so that's kind of related to the first point. And I think lastly, too, it's like, you know, what is the average revenue, right, per user on Telegram on top of time? So, you know, if you think about a lot of where Telegram might be downloaded and being used for, maybe there's a lot of these geographies which don't actually have a ton of wealth that they're putting on chain on top of ton through telegram yet. And so I think there's that aspect where, okay, great, we're getting a billion plus users. Like we have a path towards like bringing them all on chain.

But how valuable is each user on top of ton, I think is also open question mark? And so, yeah, I think those are probably to make. reasons, but I'd be happy to hear from the community what they think about that. Time to talk about our fifth and final company on the list. Binance. So with Binance, I think there's two big threads to briefly unpack here. One, it is by far the world's largest cryptocurrency exchange, and with that comes just a lot of distribution value.

I don't have to explain why. but two, the company also has enjoyed, I guess, a renaissance of sword under the new Trump administration. And so I'd like to just maybe start there. I mean, Ryan, when, go back a year, year and a half ago or so, I mean, their founder had to step down from the company. He was in prison for a few months. The company still continued to pace and continues to grow. But now it's entirely new world, especially coming from Washington. in D.C. What does that mean for a company of finances size that has already engendered

a terrific and, I guess, a terrific brand loyalty and a global user base? Yeah, I mean, I think generally speaking, you know, the regulatory climate in the U.S. has definitely become a lot more positive, you know, compared to sort of the previous administration. And so I think that's just like a general macro factor that has, you know, benefited the entire industry, whether it's finance or whether it's another company. Okay. So, but then the other big point that you hit on with your article is the role of BNB plays. A lot of people listening here probably own BNB.

They're aware of its usage when it comes to getting certain trading privileges, fee discounts, early access to programs and investment opportunities, et cetera. But one of the things that you revealed in your story is that, it's much bigger than that. And in this, and what you really tried to focus on was highlighting how it's not just like a financial driver for finance, when it comes to quarterly burns, et cetera, but that like there's something unique about how BNB fits into the finance ecosystem and the BNB smart chain ecosystem that is difficult to replicate. So why don't you just walk us through that?

Sure. So, you know, it's, it's so interesting because BNB, I mean, BNB is a top five crypto asset. So that's the biggest token in the world. I think people forget that sometimes. Like, this is huge. It's really, really big. I think it's over $1,200 now.

I mean, you're putting record highs when you publish this a week or we can have to. Right. About a shirt of $1,100 now. It keeps going up. Yeah. You know, I think when I look at BNB, I almost view them as like the final boss of tokens in a way. Like, you know, if you see, you know, okay, so there's all this movement. right like you know base wants to launch a token and maybe stripes tempo is going to launch a token one day

and i think in general a lot of people are like okay like you know there are the fundamentals of the products but how do you relate that to the value of the token and i think what's been very interesting to see is finance obviously has the fundamentals of a product down right they're one of the oldest and they're the richest crypto company in the world um but i think also they've been able to bake a lot of that sort of value back into the token, whether that's through, you know, all the things like profit, fee sharing, all that kind of stuff. If you think about that, it's like, oh, that's probably the future of like most tokens in the industry. It's just that we haven't had a big company like that actually be willing to like make that bet and actually have the level of scale and the fundamentals

to actually drive the value back into the token. And so, you know, when people ask me, oh, what do you think the base token might look like or what do you think? Stripes token might look like. I mean, my view is I'm like, just look at what BNB has done, right? Like, effectively, they have kind of created the playbook. But people of like, I don't know if, you know, people have forgotten or like, they just like don't look at it as like, uh, sort of a investable asset because it's so big now. But, um, yeah, I view that as like, no, this is actually probably the model for like how a lot of tokens are going to look like. Um, and, you know, a lot of people were talking to me like, hey, like, you know, feels like this. There's a whole narrative like RWA's,

right? Like people effectively putting. off-chain assets, tokenizing them and putting them on-chain, like a stable coin. And so, you know, they're saying, oh, equities are going to become tokenized. But my view is actually, maybe the real innovation here that we're seeing is that tokens actually are going to look a lot more like equities, right? They're going to have some sort of value ownership. There's going to be a lot of things that you can do with this token that you can't actually do in traditional equity land, like things like, you know, interacting with the products

on top of the platform, actually investing in ownership of your community. things like that. And so, yeah, I think BNB to me is quite interesting because effectively they, I view it as like their IPO or like that, that's the thing I would hold to basically have ownership in finance's future as a user. And if you think about it now with all these ETFs happening like, you know, the Bitcoin ETF or the ETH ETF, any of these like ETPs or even like the digital asset treasury structures, you can almost see a world where actually, you know, it might make sense in the future where you launch your token, the token has, you know, value flows related to the product. And then you can now wrap this into this equity structure. And that is effectively

via the form in which a crypto company can go public. Now, they can obviously go the traditional path of like doing the IPO and, you know, the way that coin basis has done it. But there's almost this like alternative path now to effectively like the same outcome in my opinion. And so it's going be quite interesting where people are like, oh, like, what if finance ever went public? And I'm like, I don't think that's going to happen. Like, the way it's going to happen is basically you have BNB token, which is effectively, you know, the stock or the thing that I would own. And then you just wrap that into the equity, uh, equity market structure and then, you know, have that trade. And that's effectively the win-win outcome if you're buying. Yeah, the B&B, it's really fascinating for a number

of reasons. And, and you discussed this in your story. It's almost like it's an equity like token because it doesn't confer any of the privileges, benefits, or protections, frankly, that come from actual equity. But for a company like Binance that funded itself through an ICA, I think back in 2017 was it, and you said they're already so profitable and their holdings are so concentrated, there's really not much of a need for them ever to go, for them ever to do IPO. This could be the next best thing. and the investments that they've taken, I think from that investment group in the Middle East,

it's really more for strategic reasons to open up certain avenues for partnerships, et cetera, as opposed to a company like Telegram that needed to raise that money to secure its own financial future. So there's a very unique mix of factors and circumstances that I think help B&B remain so brilliant, especially in a world where people see it as sort of stock in finance when it's not. I mean, it's probably in some ways maybe like the best possible version of what XRP could mean for Ripple.

Or people buy XRP because they want exposure to Ripple. But obviously it's very different from Ripple stock. So we're at the end here. I want to wrap up. But Ryan, before I let you go, just wanted to give you a chance. to reflect on any just key learnings that you had from looking at these five companies, if there's any close misses that you just want to highlight, or if you have any ideas for future research, additional questions that you want to explore

as a result of doing this work. You know, we're definitely entering into a different phase of crypto now because I think that, you know, ever since sort of Ethereum came out, I feel like as an industry, we've basically like thrown a ton of darts at the board to see what's going to stick and what isn't. And let's say we threw 100 and like maybe 5 to 10 of those things have worked. And what I'm noticing now is I think the companies understand the actual value and the benefit of these 5 to 10 things from a business strategy perspective. And so now I think you're going to start to see really the benefit of on-chain demonstrated in a big way because a lot of everyday users and a lot of these big companies are going to be benefiting. from that. And so I think that's generally a very bullish thing because I think the amount of

user account, the amount of transactions, just the amount of the on-chain economy and what's being powered through it is just going to be like exponential over the next couple of years. I think that's an awesome thing. I think the question then is going to become, who are the companies that haven't done this thing yet? Right. So, you know, we have five companies that we talked about. But what are the companies that haven't actually explored an on-chain strategy yet, which could actually be very, very interesting. And I have some thoughts in my head. I actually think like Twitter or X could be a very interesting company.

Sort of looking at a lot of what's happening on the social, financial side of things in the crypto ecosystem. I could see X actually start to like potentially have a crypto strategy when it relates to that as well. And so I always ask myself, you know, what is your crypto strategy of the next biggest company that wants to enter crypto and what is that going to look like? because my bet is that as these bets start to pan out across these five companies, it's going to become clear to the world and a lot of the other tech companies that it's actually

table stakes to have a crypto forward strategy and an on-chain strategy. And if you don't, you're going to be left behind. Right. A lot of the similar conversations happening in AI right now, right? Like all the tech companies are like, oh, what are we doing in AI? We've got to have an AI strategy. I think the inevitable outcome here is probably going to be the same, but for crypto, right? companies being like, oh, what's our on-cha strategy? What's our crypto strategy going to be?

And, you know, as that pans out over time and then in the long term, you can kind of see crypto really powering like a lot of things in the world. And, you know, that's kind of like the vision of why, at least I'm working in the industry. And so I think this is, these are really exciting times because, yeah, in 2018, 2017, people were talking about enterprise blockchain if you remember. But I don't think the industry was ready for that. But fast forward, sort of seven, eight years, I think we're actually seeing happening it now, for real, which makes me extremely bullish for what we're going as an industry. Great. All right. Well, I think that's a great way to wrap up. We look forward to the, I guess, the next list of the OnChance 5 and see what might

change, what stays the same. So thanks everyone. And thanks again, Ryan, for the series and for joining us today on Unchain. Thanks, Stephen.