Unchained - Bits + Bips: Why the Markets Now Have a Bullish Setup - Ep. 960

Episode Date: November 25, 2025

In this week’s Bits + Bips, Austin Campbell, Ram Ahluwalia, and Chris Perkins dig into a macro environment that’s suddenly turning more supportive: QT ending, institutions stepping in, improving liquidity signals, and major catalysts across global markets. But while the setup may be bullish, one corner of crypto isn’t participating at all: DATs, which Ram calls “a death spiral.” The hosts debate whether altcoins can recover, whether Strategy pushed its structure too far, if banks’ unrealized losses still matter, and why the return of ICO-style launches may say more about regulation than mania. Show highlights: 0:00 Intro 3:16 Why Ram says we are still in goldilocks economy 5:07 What is missing in the markets according to Chris and how retail is so hurt 11:07 Why the dollar has been on an uptrend, contrary to what people think 13:17 The importance of banks sitting on so much unrealized losses 18:24 Nvidia’s earnings and whether we are in a buying opportunity 22:21 Whether banks will be negatively affected by stablecoins growth or they are fine 25:05 What Austin and Ram disagree on whether the 50-year mortgage is good 28:25 Whether MSTR should be excluded from the MSCI index 32:56 Why Ram is “very bearish on DATs” and the importance of their operating businesses 45:19 Why Chris finds it fascinating the revival of the ICOs 51:19 Whether there’s a new operations choke point going on in crypto Hosts: Ram Ahluwalia, CFA, CEO and Founder of Lumida Austin Campbell, NYU Stern professor and founder and managing partner of Zero Knowledge Consulting Christopher Perkins, Managing Partner and President of CoinFund Links: Unchained: MON Rallies 40% After Mainnet Launch Fortune: Suddenly, the Fed interest rate cut in December looks like it is very much back on the table Nvidia didn’t save the market. What’s next for the AI trade? The Index Exclusion That Ends an Era: How MicroStrategy’s Exile Redefines Corporate Finance Saylor fights back Learn more about your ad choices. Visit megaphone.fm/adchoices

Liquidity has been pretty tight. And what we're seeing now, at least, is that QT is coming to an end December 1st. I think near term the setup is very constructive. When you take on fixed debt against a highly volatile asset, historically that ends pretty fucking badly. I'm very bearish on deaths. I think these are mostly in a death spiral. Hello, everyone. Welcome to bits and bibs, exploring how crypto and macro collide one base is pointed at a time. So today we've got some rather spicy and interesting topic. but we're supposed to pretend to do things in order rather than live in total chaos, so we're going to do some intros.

I'm Austin Campbell, high scholar of zero knowledge group, self-described in recovering grouchy fixed-income trader and professor at NYU Stern. Joining me today by two co-hosts, Chris Perkins, the Golden Hand of Coin Fund, who has promised us that prior to Thanksgiving, he's going to let loose on some topics and then drop the bite. And Rom, maister of wealth, leader of Lumida, who's going to bring us, uh, macro and markets perspective and may or may not be able to successfully show us a chart, we'll find out. No guests today because the three of us have more than enough that we intend to talk about and far too little time to get that done, but we will continue to have some excellent guests

going forward. Before we start, remember that nothing we say here is investment advice, and that as general advice, don't take investment advice solely from podcasts. Check unchained crypto.com bits and bips for more disclosures. So guys, let's start with a little bit of market discussion today in a section. I'm going to title in our working notes, detour or death trap. So the market's been a little bit volatile. Bitcoin prices fell to 82K before rebounding to the mid to high 80s throughout the day today. Alts in many cases have been hit much harder than that.

But where does this leave us? on the crypto side, the Coinbase premium may be back to positive. The cryptocurrency complex at an all-time daily high for volume with the CME. There have been some minor improvements in dollar liquidity, according to Arthur Hayes. He says QT stops December 1st. Wednesday will probably be the last fall, and U.S. banks increased lending in November. Jeff Park has noted that we're relatively bullish. We're finally done with long leverage trying to catch the knife.

Open interest has come back to the short side. And this is a welcome reset if we can confirm ibid inflows, which was today. If we zoom out and look at markets more generally, President Trump has accepted an invitation to visit Beijing next April. He invited President Xi to the U.S. for a state visit later that year. the market is now repricing at a 75% chance of a 25-bip cut at the December 9th to 10th FOMC meeting, and New York Fed President John Williams has signaled a policy shift, citing rising job risks and cooling inflation. So I'm curious what you guys are making of the backdrop. Rom, let's start with you and see what you have to say.

Yeah, look, overall, you've had market volatility starting with when the Fed had the Hawks That was one. And then two, you had Michael Berry shuttered as hedge on with a broadside critique of the data center theme and round trip trades. At where you are now, though, is that the market is now pricing in an 80% probability of rate cuts for December. That was due to comments from Fed Governor Wallow this Friday. Markets have rallied.

You also had elevated volatility in the VIX, which hit 26. That's usually the kind of lower bound when you start to see a rally. So I think you're in good shape. I think we rally now through year end and feel pretty good about that. I think on digital assets on Bitcoin specifically, I called this a Nick Carter rally. I think Nick Carter said I'm buying Bitcoin. This is the Nick Carter rally. So Nick, this is for you.

But I do think the rally is ultimately sold. I think maybe it's a multi-week rally. You just kind of have to reassess. I don't think you get to new highs in the next one to two months per se, but I think it's a risk on, you know, we'll have retail sales report tomorrow. I expected that'll be strong. And you see a lot of conciliatory messaging from the White House on almost like every dimension. So it's really been a change of tone ever since the elections. So, you know, overall, this is constructive.

I still view this as like a Goldilocks macro setup. You just had a negative sentiment from headlines that weren't reflected in earnings. Earnings is strong, continues to be strong, and there is ROI on the data center. Spend, we'll talk more about that when I get to NVIDIA. And I'll chime in. And I think one thing that I've noticed is that retail is exhausted. They got hammered on 1010. They're still getting over that.

And then they got this whammy last week. week, you know, a little bit before that to your point, Rom, where they're like, wait a second, the Fed might not cut in December. And it seems like rates have been in the driver's seat. It's kind of concerning as like, you know, crypto natives where we're like, gosh, you know, this really, really centralized thing controlled by a handful of governors is really driving all of our asset classes. We're trying to deliver this decentralized finance thing. And that's all that matters. The good news for markets, though, is that like, Polly Market right now is pricing 83% chance of a 25 basis point cut.

You mentioned, Austin, the futures volumes that we're seeing. That's great news if you're one of the four tokens that are covered by CME futures. The one thing I think that's still really hurting these markets, and I talk about it over and over again, is the lack of alt futures beyond those four. We just don't have that comprehensive liquidity. That liquidity is forced offshore where you're still subject to the ADL, the counterparty risk challenges, and so that's bad. Last thing I'll say is that against this backdrop, you know, retail has been hurt. They're going to come back eventually, but there's this bigger flippening

I continue to see. And that's the institutions slowly, methodically marching forward as retail does what retail does and goes for the next hot ball of money. I don't have major things to report, just things that I see in the market. I'll give you an example. We have a business. We have a business. that we launched this the risk-free rate of Ethereum, very much fixed income foundational product that that's very institutional in nature. And I'll tell you, like, the last day, signed three major contracts of, like, major institutions as they methodically march forward. And that's just like an aside and anecdote.

But I guess my point is, is that institutions, like, every day, they move more methodically forward. Retail comes, retail goes, feds in the driver's seat. One last thing that I'm concerned about, frankly, we saw Navidia earnings. They did pretty well. I'm kind of concerned what happens if they miss earnings in the future. And I think even Jensen mentioned that, that could result in some challenges. The other risk out there is you hear this like this news here and again around quantum.

Like it's coming. It's coming. It's almost like the Y2K thing that's out there that no one really knows it's going to happen. We know it's coming. And the last thing that I'm a little bit concerned about, Rob, I'd love your perspective, is on and JGB yields, right? Like, they remain elevated. And we saw a surprise rise in Japanese rates that really surprised markets a few months back,

really hurt asset prices because there's this concern around de-leveraging of what's known as the N-Carrie trade. You know, we're still seeing them elevated. And then finally, liquidity has been pretty tight. And what we're seeing now, at least, is that QT is coming to an end December 1st. So at the end of the day, all those risks and benefits, I'm kind of in ROM's corner. I think long term, I wouldn't be here if I wasn't super bullish. I think near term the setup is very constructive. Well, I'll hop in and then we can get to the GGB yield point.

One, I think, Chris, what you're saying about institutions coming in also has major implications for the crypto complex as to how we think about prices going forward. Right. If you rewind two years ago, four years ago, we didn't have. have to think about what are the differential opinions of the average crypto person versus like, call it people in their 401k funds or pension funds so much when we were thinking about Bitcoin versus alts or like rotation between tokens because everybody could buy everything. But realistically speaking, for a lot of the institutional buyers, like you said, if there's not CME futures or some

sort of listed equity product, a lot of them are just not going to touch the thing, right? Like, I don't think there's a lot of institutional buyers of like many of these project tokens, many of the smaller blockchains, many of the more like subscale projects of this space. And so as we're looking at price action, I mean, I will remind everybody that Bitcoin going down to the mid to high 80s is still up significantly from the election. But there are a lot of alts that have performed significantly worse over that same time frame. And I think that might have to do with the growing divergence between, the buyer pools because if you go look at people who are the holders of Bitcoin now,

and if they own any other crypto and would identify themselves as traditional financial investors versus say the holders of let's pick something not even too far off the beat path, like say the SWI token, you probably have a very different investor profile just between those two pools, much more than we have in the past. Like, Ron, what do you make of that? What would you expect? Yeah, no, I agree with your observations. digital assets like Bitcoin have a bid. There's an emerging thesis for an international money with the major institutions behind it. All coins, I'm not sure you can trust their fair value.

The depth of the order book is limited. It to be highly selective. A strategy that's long, top three and short the rest probably does well on average. I think I'd be very suspicious and skeptical of the vast. majority. This is not a controversial statement, I think, for us, but I don't think people appreciate that. You know, you stick to quality, stick to liquidity. Just on the JGBs, I put this in the, from a medium and longer term perspective, this doesn't really mean much. It's just a nothing burger. This is like a phrase that you hear me say often. This is another one. This is just another,

nothing. The good news is I'll talk like big picture than tactically. Big picture what matters is earnings, a pattern of disinflation, constructed regulatory policy, consumer spending, the government's spending. All that's going in the right direction. You have record beats, strong earnings growth. That's the big picture. Like, every single cylinder is working here. The restaurant that's just news and sentiment, Sam Malman says something stupid to Brad

Gersoner about a trillion dollars in unfunded liabilities. Michael Burry comes out, shutters his fund, takes a broadside attack. Like, that's just news. So on JGBs, tactically, the good thing is that the U.S. dollar has been through an extraordinary rally. If you look at in the last three months, look so much for the dollar debasement trade. There's no dollar. Dollar strengthening. The reason why that matters is that the yen carry trade is funded by borrowing in Japanese yen.

So the risk is that if rates go up, your funding, your carry costs go higher. But your liabilities are actually dropping. net due to the decline of the yen versus the U.S. dollar. So it's nothing burger. There you go. But strong dollar oftentimes leads to weaker commodity prices. That's the other side, right? So, you know, that has impacted, I think, in price action in certain cases.

On the all point, I agree, fundamentals matter. They're not always in the front seat, you know, as we've seen recently, very, very constructive, long-term fundamentals for certain projects. but and I think you'll see that differentiation. And then of course, like I'll continue to say it. Like institutions can't touch it. Even the dat, like the dat is an amazing wrapper because, you know, it's just another, just go into your brokerage account or your institutional OMS and you buy another one. But it's very hard if it's a super volatile asset, particularly going into your end where you don't want to see a drawdown because you've had a great year.

You know, that's part of the issue. I will echo ROM on the dollar. I guess we can call it rebatesment trade. I don't know how we want to name that one. Though I do want to counter one point on the bright economic news. So banks are still sitting on $395 billion of unrealized losses. And I think people don't understand what that will do to credit creation. Liquidity looks better than it is with that is going on because banks are going to be holding a lot of reserves.

Everybody will say, oh, they've got a lot of dry powder for lending. but in many cases, like a good one to look at that had large losses in the health of maturity bond focus Bank of America, right? They're going to be sitting out a lot of cash not to go lend that out to people, but just so that they have a strong balance sheet so that people aren't going to come run the bank as happened to Silicon Valley Bank. And that sort of grind takes time and the inability of the administration and like the Fed to get rates significantly lower, especially once you get outside the short end of the curve, has an impact on that. one thing I would say in addition to I agree with the comments on QT and that coming to an end will be moderately helpful along with Treasury starting to spend again. But I think there's more work to be done from the credit perspective. And the other thing we're seeing on that front is like very low mortgage origination, right? Like you have a lot of people locked in compared to historical norms and like not a lot of activity on that front.

So when we're thinking about retail, when we're thinking about the general market, sort of like, Rahm, I guess this plays in with your, nothing ever happens mean sort of like thinking here. I've been saying for a long time, things are not nearly as good as the optimists would like and not nearly as bad as the pessimists would say. And we're sort of grinding along mediocre on a lot of these measures. I'm more on the optimist.

I'm more optimistic than that. The only thing that is holding people back for recognizing just how things good are, while acknowledging, yes, you have a K-shaped economy. Yes, yes, of course. That's legitimate. Been the case for decades. It's true. The only thing holding people back is the fact that asset prices aren't where they want them to be. But if they were, I wouldn't be as excited.

So this is pretty, the going's pretty good. You're supposed to buy when DVD's got a 4P of like 26 times earnings with $66. with 66% year-over-year revenue growth, and meta's at 20-time earnings with 40% year-of-year earnings growth. That seems like a compelling, you know, and that's some backdrop. Let me jump, Austin, let me jump on your bank point

because we know a little bit about banks. And I don't think it's a surprise that you're seeing the Basel Committee now lighting up a little bit, particularly when it comes to crypto. They don't just do that without pretty strong feedback, from people like Governor Bowman and others, that's the other liquidity unlock that you could see is the U.S. really starts having a more outsized role and really like, certainly Besson's a smart guy. He gets how this all works. And the other like liquidity toggle they have is bank regulatory

capital. And I do think that's trending very positive for the banks, which could help to facilitate some of that unlock that you're suggesting. Do you agree? So I agree if they do it. my worry is that the Basel Committee is like a glacial entity, right? Like them starting to work on it means five years from now we'll have an answer. But the interesting part, Chris, and I don't know how the coordination is going to work is do the U.S. banking regulators just go rogue on that and impose some other treatment. That's my point.

I think the U.S. regulators are starting to say, well, wait a second. You know, I have a lot, especially Treasury, you know, I have a lot more to say with the front end of the curb with these things called stable coins now. That's awesome. Why am I letting the European set Basel rules? No, I know what's best for my banks and for our economy. And, you know, it's an America first regime. So I don't know. I feel like that's something that they're much more attuned to in my recent discussions.

And just seeing that data point where the Basel guys are walking back, some of the things that they're walking back, I thought that was super interesting. Look, I think the banks were in good shape. Credit growth is 4.4% year over year. That's great from a GDP perspective. Access to credit's good. Credit quality is good. Credit performance is good.

Delinquencies are low across the major banks. There's no credit health issues. We're three to four years into digesting commercial real estate issues, which are more and more in the wherever mirror. The other part, fun fact, there's an ETF called, you guys appreciate this, G-Sib, G-S-I-B. Okay, these are all the systematically, the SIFI, too big to fail banks. that ETF is outperforming Bitcoin. This is funny because think about the origin story of Bitcoin

was Satoshi Nakamoto wrote in the Genesis block. He made a comment referencing no bank balance, right? G.Sib is up. Not 10, not 20, not 30, 45% year over year, 45%. So banking sector is good. That matters because it's the bedrock of the economy. No, I agree with that one. Okay, so on the note of the bedrock of the economy, let's talk about the other thing for a moment, Rom, since you brought this one up, Invidia.

So, Nvidia earnings were not bad to say the least, and yet after they beat, the stock fell 3.2% after an initial pop. Valuation concerns seem to be dominating the news headlines and the timeline. I guess the optimistic take is that this is a healthy correction. I'm a skeptical take is this is the start of an unwind. Rom, you mentioned meta earlier. They're, what, down 21%. Microsoft is down, like, low double digits as well. CoreWeave is down nearly 50% in November.

Semis in general are down about 11% in November. Their worst months since 2022. What are you making of all of that? Like, is that a buying opportunity for people or the start of something worse? Yes, no, it's a buying opportunity. This is what you should be buying on Black Friday. This is what you buy. we had a high beta crowded positioning unwinded that's what happened that's the simple variable to

understand what happened if it was a popular consensus name and a high beta and especially if it was in like the data center theme then it sold off pick anything that met that category it's not so much stock specific it's just crowded positioning got unwound a lot of retail investors were hitting sell they ran for the exit. I think that's behind us. Like, asset prices are responding as they should, if you have the lows in place. The new video earnings were better than just strong.

They were outstanding. They were shockingly good. I say this is like a mild-mannered individual. Like, I'm rarely ever hyperbolic. They had an acceleration in their quarter-over-quarter growth versus last year, same quarter over quarter. They continue to sell out every GPU that happens. They maintain pricing power.

They can pick and choose their price points. They control their gross margin. They have visibility through most of 2026. When we get through 2026, they'll visibility through most of 2027. They've had a B-beat raise every quarter since CHAPT. That's because they know how to manage Wall Street expectations. You know, there's 1,200 data centers globally, if you look at just the hyperscalers. And most of those are CPU, old school data centers.

There's a buildout of new data centers at a GPU native. And we're only in the early innings of this. Now you've got the Trump admin enabling Saudi Arabia to go build out, potentially up to 60 data centers. That'll be full with the video chips. So, yeah, I mean, the earnings were. and the revenue was like, it was strong and outstanding. That said, I'm actually only benchmark weight in the video. I'm not actually overweight it because, you know, positioning can get in the way

when that's crowded around a good opportunity. I think it'll do fine now, but I'd rather own, you know, meta. I'd rather own some cruise line stocks and other things. And then on top of that, Rahm, it looks like Trump just accepted a state visit to China. And China will do the same. So I feel like that's probably a green shoot as well. But I guess here's my question for you. What are people going to be talking about at Thanksgiving?

Vidia or crypto? The Mamdami White House visit? I mean, that's one. Yeah, maybe. I don't know. What's up with that one? What's up with that? I mean, that's one.

Let's see. They're going to talk about, we're going to have that meme about the guy in the attic who's talking about Bitcoin, right? That meme's going to be back this year. Last year was the opposite. Last year was the opposite. That was a victory lap meme, right? what else I get

to talk about Dixie? But I put it back to you guys. Probably they're going to talk about the GSIV ETF now that you mentioned it. Look, I think banks are just so well positioned. Almost any dimension you look at it. Yeah. So stable coins aren't going to be their death. I mean, I spoke to my buddies who literally run the GSIbs.

And they were like bank deposits, these stable coin things are going to kill me. But that's really, gosh, just like money. It's not the case. They're doing just fine, aren't they, Austin? Banks are doing just fine. I, though I would say if banks have killed themselves in some way here are going to get killed by stable coins, I don't think, what's the right way to say this? I think that banks may have dramatically overplayed their hand on the policy frontier in a way that's going to have reverberations people don't expect, which is to say the gloves came off and it was like naked. self-interest with trying to ban yield on stable coins, and people know that. And the reason for that is, like, this is the advantage. I'm a business school professor. I literally teach this stuff. In the

1933 Banking Act, there was a thing called Reg Q. And Chris probably knows what Reg Q was. But for people who do not, that was the ban on paying interest or yield by banks. And what happened is that in the 70s and 80s made them uncompetitive products. So they had to. to get rid of that restriction because it was crippling their ability to gather deposits. And now banks, who had that restriction taken off, have gone and argued, well, you should restrict somebody else with the thing that we just argued, like two decades ago, were things that made us uncompetitive and had you get rid of so that we could go do the exact thing that we're having you ban somebody else from doing.

I have been hearing things coming out of D.C. that are totally different on banks that I've heard my entire lifetime. Like, let me just. just throw something out there that I think may now be inside the Overton window. How about the repeal of Graham Leach Bliley? I'm all for that, by the way. I'm all for that. Bring it. Let's do this.

Yeah, look, I think you can offer consumers more value if you have integrated offerings and services. Like one-stop shop makes a lot of sense for banking, insurance, wealth management. I think that's a great idea. Now, you know, banks are under pressure from stable coins, but it's community banks and some of the regional banks. that's and it'll take time for the soul to play out. And the last point here,

stable coins, they created a bid for the US dollar too. So Besson got a Besson nailed the stable coin. But kudos to Scott Besson, like did the right thing. I think the mortgage move 30 year mortgage, right idea also. I will argue against you on the 50 year mortgage one.

I actually think that's a bad move. The longer you extend duration, right, for people and the longer we take the timeline, like, out to both buy houses and pay off mortgages. One, the more duration risk you're putting into the economy in a way that's going to be hard for people to hedge. Like, somebody's got to own that duration if we want to extend that. So that's problem number one. Problem number two, I'm like skeptical of many forms of credit creation from an affordability

standpoint because the core problem is supply. If we don't build more houses, but we continue to subsidize to make. subsidized demand, subsidized demand, subsidized demand, all you're doing is causing inflation. Like, that's not to anybody's benefit. We're just inflating house prices for boomers. And the reality is young people still can't buy anything. Prices will still be going up. We need to build more stuff if you want to solve the affordability problem.

Just a brief response to that focusing on the U.S. consumer, if you've got a 50-year mortgage and your average mortgage holding period is seven years, that creates value. So the duration risk is really, and what you were getting at, is someone in the capital markets. It's not on the consumer. That consumer is going to be able to have more disposable income from that 50-year duration.

And it's one of the few times that the consumer can borrow as low as and sometimes lower, depending on how you time it than the U.S. government. It's one of the few times. So if you can let them take advantage of that, opportunity and the ability to refi. It's a good opportunity. So, yeah, my my trade off though, ROM is I worry about it breaking the mortgage complex, right? Like as somebody who's been on the other side of that trade, it's seen people owning MBS or like owned many billions of MBS in one

portfolio. I'm going to ask a hell of a lot more for a 50 year, right? Because the problem with that seven year holding period is I get delivered the worst of, right? The stuff that stays is the stuff I don't want because rates went up and people are not refying. And when rates go down, people refi on me. And the impact of that is even greater with a 50 year. Like I actually think counterintuitive, but I think there's a very good chance that 50 year mortgages raise mortgage rates, not lower them. It's a great point. It's a great point. Yeah, you have the term spread. I mean, it's a markets risk management function to resolve that issue and see where prices land. Have an additional option to borrow expands the opportunity.

set for a borrower, though. We should not give that without forcing people to build more houses. Like the real trick would be to have the federal government like make the Fannie, Freddie, Ginny guarantees on 50 year mortgages contingent on building housing so that if California wants to continue not to build anything forever, they just can't participate. Yeah, we got a problem with Brian Johnson too, right? Mortgage comes from the word, the Latin word mort, which means death, right? So it's supposed to be the debt that stays with you your entire life.

People are living longer. Just wanted to throw that into the mix as well. All right. So before we get too further off track on turning this into a housing podcast, let me talk about some other forms of financial management. Let's talk micro strategy and stats. So MSCI might remove micro strategy on January 15th because it's BTC holdings or something around 75 to 80 percent of its assets. certainly above the 50% threshold that they're now saying would reclassify things as a fund, not an operating company.

This is going to trigger many billions of force selling from passive index funds. And to remind everybody, passive index funds just look at the list of things that it index and buy them. Right. This is not a discretionary thing. They just follow the list. So that breaks this reflexivity route. MSTR's MNAV premium is now down to like barely positive, if positive from like, literally three exits up points. And so this thing just kind of trades like a closed-end Bitcoin

fund after that. Saylor obviously disagrees with this. He said we're an operating company, not a fund, citing the 500 million software business. He says they have 7.7 billion in digital credit deals as proof of, quote, active structuring and argues that they're a unique Bitcoin backed finance company, not a passive Bitcoin holder. I'm going to pause there before we talk about Dats further. What do you guys specifically think about the Bikr strategy thing and the index inclusion? From a price perspective or what I guess price and two like do you think MSCI is doing the right thing excluding them? Yeah, that second one I don't know how to answer that one. But yeah, and the first one, I think it's probably old news and it's probably history. And usually

when you see the announcements, the worst has already impacted the asset. So it's a Everyone knows this now. It's a highly covered asset. The news is socialized. I think on the latter, one of the challenges that you have is that this is not an RIA. An RIA is a registered investment advisor. You know, why it's not an RIA? Because Bitcoin's a commodity. And so I think that they're kind of ignoring the law. And we dealt with this with the rest of the debts. If they were stacking a bunch of securities, they would be an investment advisor. They're not. And that's that's the law of the land. And so I have a, I have an issue with it.

Look, their commercial entity, they can do what they feel like doing. Being in passive indexes should be, you know, not the end all be all, but it's really nice for price action. If you can get your data in there. Look, I think the entire debt complex we should talk about a little bit as well. We're seeing a lot of pressure, negative MNAVs, stock prices have been hit. And I think there's been some really good dialogue. around why and like what's the natural stasis of that the fact is it's expensive to be a public company especially post sarbanes oxley you got quarterly reporting you have an entire set of compliance

apparatus that you have to have in place so you can stay compliant with the law and you know a lot of history we have to blame for some of the things that have happened and why we need that type of compliance i think in time you're going to see you know trump's even talked about moving from quarterly to semi-annual reporting, things like that to take some of the regulatory burden off. But TLDR, it's expensive to be public. That said, you know, if a debt is run efficiently, if they have control over their expenses, it's pretty simple math, you know, what does it cost to run? And what is my yield?

And what is my risk-adjusted yield? Am I able to have profit from an operating company perspective? And I think as you get into like dats, like the ETH DAPs, you know, they're generating that 3% and then some yield. If they can keep those earnings underneath the expenses, I think the natural stasis should be a positive MNAF. But the market's going to do what the market's going to do. And then, of course, if someone were to take over one of these bad boys and liquidate them, your MNAV should return pretty close to one. I'm very bearish on DATs. I think these are mostly in a death spiral.

I think you should stay away. I think the market's going to force the holders to put them out at terrible prices. The Dats have way too much structure on them to enable MNA, which is one way to unlock value. And the second way to unlock value is to sell the native token buy back the stock, which also undermines their narrative. Markets know all of this, too. So this is a terrible position to be in, I think. If you own debts, certainly stick to the highest quality debts you can find. Yeah.

You know, stick to the highest quality debts. The vast majority of debts are alt coins. And I don't think you've seen the bottom yet. Oh, look, I'm not going to push back and say that a lot of dads have some serious issues. Like, we even talked about the lack of futures for some of these alt dats. Like, it's very hard to, to, to, to, to, to, you know, if you don't have all the tools at your disposal, it's very difficult. I do think that there's value, but again, it requires that fundamental underwrite and you have to look at there's going to be, there will be some phoenixes that rise out of the ashes, but there'll be plenty of ashes is how I look at it. Yes, wait for the ashes, wait for Rome to burn down, and then wait another two months because you're still probably too early, then poke around and then you might find something there.

I will remind everybody, Phoenixes are not guaranteed. Sometimes it's just ashes. But I guess I would say, oh, everyone hates it. Well, let's, okay, so let's zoom out on them for a minute. Like Matt Hogan had a very good threat on this, but I'm going to paraphrase it and say it relates to some of the things I have complained about with DATs. And I think, Rom, you've said before as well, which is, let's think about DATs and valuation. One, if you had a DAP that you knew with certainty was liquidating basically tomorrow, it should trade exactly the value of its underlying assets, right? plus or minus some wiggle for selling that thing. But that's an execution question at that point.

They don't. Why? On the bad side of the ledger, Matt says expenses, illiquidity, and what I'm going to file under corporate risk, a.k.a. idiosyncratic risk, aka Chris is the director, and he turns out to be a North Korea and he stole half the money type stuff, back to why do we have Sarbanes Oxley in the first place? Right. So all of those are completely valid reasons

for a debt to trade below. par, expenses in particular for many of these debts, as ROM said, are very high. There are some that have promised, quite frankly, some egregious compensation packages to people, and so as a result, should be trading at a large discount. So Matt's reasons for trading above par, and here's where I'm really going to lean into the ROM bit, where debt issuance so that they can have cheap funding, the ability to lend assets and income generating strategies with derivatives. And let me tell people this.

All three of those are reasons for them to also trade negative. If you look at the leaders of most stats, you do not have, like, experienced bank and hedge fund executives doing this 80 hours a week with the kind of track record where you think they know what the hell they're doing in that space. So as Chris, myself and ROM can all tell you, banks are like a combat sport. Like you are playing against other people. This is a competitive feel. if you think you could just get into lending and magically make a profit or get into derivatives trading and magically make a profit without paying a lot to hire good people and building a whole bunch of stuff that itself is really fucking expensive.

You are like on another plane of existence. So I actually look at most dads trying to do that and be like, nope, they're going to blow themselves up. Amen. I think you made a great point at the end. Operating company matters, right? And at some point, everyone's going to be some kind of a debt in the future. this thing that I think is going to happen called decentralized finance wins. People are going to hold assets on their balance sheet. Maybe not. That's not going to be their primary objective,

but you're going to see this convergence happening in operating companies matter, profitability matters. I've talked to many Dats in the last week, some really good ones. Their entire focus, operating company. Hey, I see this gap in my ecosystem. I'm going to close it. I'm going to go out and I'm going to lead enterprise sales. I'm going to leverage the power of U.S. capital markets to really build out an incredible team. Maybe I'll make an acquisition in this space. I'm going to own the operating company. On debt, I'm so glad you brought this up. I've been thinking about it forever. I think structured correctly, you could have a new type of debt, in-kind debt, where you actually offer total return products, and you can actually make that part of your operating

company because if you know what you're doing in the defy space, you can probably earn more and take a spread on the coupon that you have to pay. Take Ethereum, for example. It's almost impossible for a sovereign wealth fund or anybody else to buy a security that pays you total return Ethereum. Pure total return, ETH. You can buy the EATF. It's really hard to stake because you have to hold contingent liquidity because of the unbonding issue, which has gone out of control because we had an issue. But what if you were an issue, take in-kind ETH, stake it, make a spread, pay back a competitive rate. If that math works, you can actually make money and you can offer the world something that they want, a total return security.

Am I wrong? No, I think that one makes sense. And the other thing that I would say is, Chris, I think you've hit on something important about the debt conversation too, which is the type of debt that you take on really, really matters. So if you look at micro strategy, the mistake that they've potentially made is like term debt with fixed coupons as things are like flopping around like dead fish. And then went and acquired more Bitcoin denominated assets on the back of dollar denominated debt, meaning that you've got a such. an FX trade going on inside of that thing. Right. Chris, you're familiar with FX. It's more volatile than people think when you put Bitcoin on the other side, boy,

or things are going to get spicy. And that's just Bitcoin, like alt's even worse. On the other hand, if the data dat used was something like, say, repo, right, where you're just essentially, you know, using your Bitcoin or something, lending it out and collecting something in return or doing the reverse, like borrowing dollars against it. And then, Chris, as you said, deploying into defy and earning a high, spreads that like the regulated financial entities, there might be something there. But the important

part of all of that is that your currency and like term matched on both sides. Yeah, there's more to it, right, Austin? Because many times you're going to have dollar liabilities. Yes. Right. You're going to have to pay people in many cases, you know, yeah, you can buy NFTs with ETH, but you know, you still have those dollar liabilities. You need to stable coins like you have people want dollars. They're not going to, many cases are not going to take your Bitcoin or ETH or not yet. And so that mismatch has to be really carefully managed. You know, personally, I don't think it's going to be the end of the world for some Dats to sell in kind because like if you're a monster ETHDAT and you're making nearly 100% of your

revenue, and again, I'm overgeneralizing and staking, let's just say. And I don't think that's going to be a successful formula. I think they're going to have other operating companies. But if all of your revenue is in ETH and your liabilities are in dollars, Maybe you can lend it out. But look, at the end of the day, that's that mismatch. One of the tricks in managing a dad is that mismatch. Yeah, I mean, I concur with everything.

Like, dad is just adding to the beta. The beta is going in the wrong direction. That's it. These are attention, momentum assets. The attention is moving to Navidia, Tesla FSD, Google Gemini 3, everywhere else. And I think that'll continue to outrun. For now. And like, but the fundamentals are like it, but Rob, look, if you can build fundamentals and you have an operating company that's profitable, like, that's the solution here, isn't it? You got to earn your way out.

I agree. Three to five, like your each point is like right on the mark. Like, I think it's, that's, it's accurate. However, you got to generate so much. You got, we got 40% EPS growth at meta. We got 60% revenue growth at at Navidia. Like the core. generating power isn't there to, you know, at the current prices. And exactly, until Etherox back to 60K, like Tom Lee's telling us is going to do. And then it's going to be just fine because we're because we're stacking crypto to share. Every cycle, someone gets carried out in a stretcher. Is this, is this Tom Rief time, right? I don't know. No, no.

I talked to this morning. He's going to be fine. Is it Michael Saylor's time? I would tell you, I'm more worried about them given the debt structure. That's not a statement on Sailor. That is a statement on when you take on fixed debt against a highly volatile asset. Historically, that ends pretty fucking badly. Yeah, yeah.

The thing about the debt is that even if you did overnight funding, if you can't roll over your debt, do some kind of seizing in markets, you have an issue there, which is another issue we saw in the 2008 crisis, right? Well, we saw, hold on, we saw that when it was matched against longer dated stuff. So like, let me propose a theoretical debt structure than I actually think would stand the test of the current moment, which is, let's say I have a debt that has a huge pile of Bitcoin or Eath. I go borrow against that and just deploy it into the basis trade, right? I'm earning a spread on that thing. So I'm generating positive cash flows into my vehicle and because I can unwind the basis trade spot and my borrowing is spot, I'd term matched on those things.

that exactly, as Chris said, you got to take those and start buying more things that generate cash flow. That's kind of like, call it like Dat Berkshirt. That I think could work. But like anybody doing term here, like, guys, look out. You don't do term on a 60% fall asset. It's a great. But look, I think this, go ahead. Go ahead.

Sorry. No, the Alts can't can't do that basis trade, a regulated basis trade with futures, right? Because they don't exist. Except for the Dats can. The Dats can. No, they can't. There are none. That's my point.

It's like there are no, like, we, we, We're just really hamstrung right now. I think they're coming online, but we don't know. I'm saying your dad should do this like offshore, just like do it with Athena or something like that. Like there are ways to get a racist trade as a dad. Keep it regulated, man. I was going to say, I'm making you angry now. I'm just saying if you want to take that risk, you totally could.

The consequence of all of this, I would say, is number one. Dats will be sold on rallies. People, they're in quicksand. They're trying to keep their head above water. or I'll blow the sand, I suppose. The second thing is you will see puking. You will see the market will wait and you're going to see bodies floating in the water that are recognized names that had to puke at the worst possible price.

And that's when I would start to say, gee, is there something for me to do here? Hold on. He's actually, go ahead. Is there going to be anything left to do, though? Because here's my other question. Are the Dats prepared for making cops? attacked with activist hedge fund investors because those guys do not play nice. And you're going to get into situations where I don't think there's a body that ever floats to the surface. I think they

chop up the corpse and sell it for parts. I think that's the same thing, though, right? Because you're going to see significant equity impairments somewhere. You're going to see write downs and losses. And you're going to see maybe, I don't know, a fund that got into this in a big way, see redemptions of capital, maybe a shuttering. I think it's a bad situation. Everyone knows it's a bad situation, too, is the problem. That's why you get the sell on rally. So it's a circular gunfight, and your incentive is to defect and shoot.

That's what I see. I hate to be kind of bearish here, but that's just how I see it. So now you made a point about dead bodies and there's still a lot of discussion running around crypto markets. And one of the challenges we've had with liquidity is that the dead bodies haven't quite risen yet. They're still they're still trying to they haven't surfaced since 1010. That's also impacting the overall crypto markets. I don't want to get away from that.

But like it takes time for these dead bodies to come up. Right. Look, you do have a nice little countertrend rally now, right? Like you've seen things like BMNR went up like 20%. today. It's going to should rally with risk assets for a bit. I would just say, my view would be don't kid yourself and say, okay, we're so back. I think a lot of people are going to say, how far can this run before I hit the bid? That's what they're looking for. All right. So speaking of things that we've got to ask how far they're going to run on. Let's talk about the Monad ICO. So Maynette is now live. Total supply of 100 billion tokens. 7.5% were sold via. a Coinbase's token sale and a 2.5 billion valuation. A lot of the rest was airdrop to early users. The remaining breakdown is 27% team, about 20% investors, 38% ecosystem a little bit for the Treasury. Today, the fall on that has been high. It traded below the ICO price. It's now

above the ICO price. Last I checked, it was about 3.5 billion FDP. I'm also going to take a moment to remind everybody here a properly priced IPO or ICO should trade above or below the cost of about a 50-50 ratio if you've like hit the target squarely with the market. So I'm curious, what do you guys make of this ICO? And I want to throw at a specific angle for you, Chris, because we're talking about regulation, which is that this was on Coinbase's ICO platform. They are directly challenging the offshore exchanges like Binance. They found a way to offer this to most of U.S. retail. I think not New York and maybe not Hawaii, but most of U.S. retail. And I'm curious what you think is going on both with the token launch in capital formation,

but also what it means for a U.S. company who had done this and given it to U.S. retail. Totally fascinating. A year ago, this would have never happened. Like somebody would have gone, you know, would have been in Gary Gensler's crosshairs in a major way. I mean, straight to jail. If you even thought about it, they would get you. I mean, but now it's just, it's incredible how far we've come in so short a time. where we're using where public markets are now able to leverage public markets.

You know, they say it a compliant way, and I don't think it's been challenged yet. It's KYC. I think many of us having survived some of the shenanigans we've seen with different air jobs and other types of solutions, I think people kind of welcome this kind of anything that will make things better and solve for the more democratization of access. I think this was offered at like, what, 2.5? 2.5. Yeah, and so now it's trading up a little bit.

So if you got an early, maybe, who knows where the market's going to go, but at least, you know, you weren't boxed out in favor of some large institution like we typically see. So I think generally favorable for the direction of travel. And if you talk, if you listen to Secretary, I'm sorry, Chairman Atkins, you know, he wants to make public markets great again. And yeah, I think there's plenty to do on the equity side. I think this is really exciting on the crypto side. And then let's not forget internet capital markets.

You know, there's an entire defy way to do this as well, which makes me even more excited. I think that maybe ruffles some more feathers, but at the same time, the opportunity set is even more profound. Imagine anyone in the world with access to the internet can buy a token when it's first launched. like that is very cool. So I think a lot's going on in public markets. I love the direction of travel. There's going to be some tweaking. It wasn't a home run for Monad, right? It kind of got off to a good start. It fizzled a little bit. And then they were oversubscribed in the end, which is great. But I kind of want to see more of it. Yeah, I mean, I'll say this is sort of getting to the heart of some of the criticism I've had for the SEC under Gensler, right? which is if you create a regime that's so broken that the only people who can get in as early

investors are essentially qualified institutional buyer level or other really high-end people, you're creating a bifurcated market and pushing everything offshore. And when you push things offshore to highly call it opaque platforms, you end up with problems like, you know, at the medium end of problems, the listing process of Binance where there's a lot of allegations of like pay-to-play type things, Binance to take. huge cuts of tokens because there's not much competition or at the very bad end of the scale, literally FTX. Look, I'm not saying that I'm 100% certain all of this works under current U.S. law, but I am saying this is exactly the kind of thing the SEC should be finding a pathway for

because it's way more fair to retail to get their hands up things early on at the same terms as everybody else in a relatively transparent way through a U.S. entity. Right. And so, Chris, I think the point that I want to hammer on here for a little bit is, again, this is kind of how these things should work if you're going to do them properly, right? Which is to say, I don't want a lot of offshore nonsense. I don't want undisclosed terms. I want to just like shotgun this thing into the world, right, at equal terms and let everybody play. Markets, people are going to win and people are going to lose, but they need to be about fairness. Yeah, and I agree. I'm nodding my head. It's leading by examples, showing how to do it the right way. It's a big win for,

or Coinbase too. And Coinbase has a new business model here. They can curate. I think on the asset itself, there's a lot of float out there now. I think half of it is unlocked. And then in a year, another component becomes unlocked also. I think it's just a difficult market for digital assets right now. I think overall.

So they've accomplished quite a bit. It's just a difficult market that the category is in. I think where we tactically are today, things could be interesting. But can people zig and zag correctly? It's hard. That's hard, right? Like, they're easier games to play, right? If you try to do the zig, you're going to pay taxes, get short-term capital gains taxes.

That's how my vantage fund is like, all right, where can I at least get long-term capital gains? All right. So speaking of it being a hard market for crypto, let's return to one of Chris and my favorite topics to close this one out, which is what I'm going to call Operation Choke Point 2.1, which is to say JPM allegedly closed the personal account of the founder of Strike and refused to give an answer as to why this was going on. So Jack Mallor's strikes founder claimed that Chase had previously closed Strikes business account during the Biden administration and set up. on Monday that the bank had also been rejecting some user deposits to strike, telling customers that the business, quote, participates in fraudulent activities. There's a rumor out on the street that Morgan Stanley has also been reducing the willingness to accept collateral in the crypto space, I think, as a result of the dapping, but including also maybe hilariously your Coinbase stock. Chris, what do you make of a replay of these kinds of things going on yet again?

Yeah, look, I can't speak to the case, but having worked in banks, this is how it works. There's like a conveyor belt, right? And you go on that conveyor belt and off you go. If something is off, something is flagged, you fall off that conveyor belt. And it's really hard to get back on. I think under the previous administration under Operation choke point, there was definitely a filter that didn't even let you get on that conveyor belt. It was like, no, we're going to find you. We're going to kick you off.

I think this was probably, I'm speculating. I've got no idea if this is true or not. But my sense is that something in the Algo flagged something, it came off the conveyor belt. And I don't know, sometimes they don't respond very. It's hard to get it back on the conveyor belt once it's off. And so that could have been what happened. I don't know. It's a fine line.

Like when you talk about the whole collateral thing as well, you know, banks should be allowed to manage risk. And they should. but what kind of risk are we talking about? Market risk is fine. You've got 10 years of history and you can make informed things. That's risk management and discrimination are two different things. And I think that's where you've got to kind of figure out and draw the line. I would say for me, what I consistently run into.

And by the way, if you're an executive at any of the big four banks, if you're listening to this, please listen on this point, which is I think a lot of the problem banks are now having address in crypto is deliberate. It's that they don't have people who know how to do this or evaluate these things internally. And so the natural risk aversion of people of, I don't understand, therefore, no, takes over, right? Put differently, there's no good reason not to include Coinbase stock as collateral. That is a well-understood public company other than you just feel bad about crypto and think the whole thing is going away. And I will tell you this. I have met,

not an insult, zero risk managers who still work at the big banks who are genuinely qualified advantage crypto risk, right? Like anybody who's good as left and gone into the industry and is doing the thing there. So my gut reading this, honestly, is that it's actually revealing a bigger problem many of the banks have trying to get into this space, which is that it's the blind leading to blind in a lot of these places. Yeah, same with the government, right? They can't even trade the asset. So that's going to take time. Yeah, for those who don't know, Chris's reference there is that if you're at one of the regulatory agencies in the United States, you are literally not allowed to own digital assets.

I have a personal friend who is at one of the big banks who went into government who literally calls me on the phone. It's like, hey, I've got some odd lots of crypto left over and a wallet. Can I just send it to you? Because they have to dispose of all of this stuff before going into government service. And it's just like, how do you, it's a little bit like we expect you to regulate like traffic and automobiles, but you're not allowed to drive and you can never have owned a car. Rob's just shaking his head.

Yeah. It's not a nothing burger. Yeah. Well, that one, the problem is they're regulating burgers and all they have is a nothing burger. All right. So there's our final financial advice for the U.S. government for this episode, which is let's your people trade some crypto so they know what they're doing. All right. So on that note, thank you for joining us everybody today for this episode of Bits and Bips.

We had no advertisers because our consistent campaign of teasing XRP caused them to fire us. No, that is also a joke. But we will be back in one week to discuss more about how the world's crypto and macro are colliding. Until then, everyone take care. Happy Thanksgiving. Happy Thanksgiving.