Unchained - Crypto Sentiment Is Down Bad. But Is It Time to Go All In? - Ep. 784

Episode Date: February 14, 2025

Crypto sentiment is extremely low, but is the market completely wrong? While X is flooded with doomsday takes, Jeff Dorman, CIO of Arca, argues that the real fundamentals of crypto are stronger than ever. In this episode, Jeff breaks down why investors are overlooking key signals—like growing regulatory clarity, the tokenization of real-world assets, and institutional interest—and how memecoins have hijacked the broader market narrative. He pushes back on claims that there are no fresh narratives and explains why the current climate reminds him of previous market mispricings that turned into massive opportunities. He also dives into the potential of tokenized assets, why crypto adoption is way ahead of where people think, and why he believes the industry keeps making the same mistakes when it comes to marketing its breakthroughs. Show highlights: 2:03 - How dishonest takes are flooding the crypto sentiment, according to Jeff 4:04 - Why he pushes back against the sentiment that there are no fresh narratives 6:13 - Whether memecoins are to blame for the poor market sentiment 13:17 - Why Jeff feels that the crypto investment thesis is still very strong 19:23 - Why Jeff says that the launch of $TRUMP and $MELANIA was a good thing for the industry 26:55 - Why layer 1s are very hard to invest in 30:57 - Laura and Jeff’s disagreement about what would it take for a blockchain to win Visit our website for breaking news, analysis, op-eds, articles to learn about crypto, and much more: unchainedcrypto.com Thank you to our sponsors! Somnia Network Guest Jeff Dorman, Chief Investment Officer and Co-Founder at Arca Previous appearance on Unchained: Crypto Prices Are Way Down. Is It Time to Buy the Dip? Links Unchained:  Arca: “That’s Our Two Satoshis” - I’m Fed Up with the Misinformation by Jeff Dorman, CFA Learn more about your ad choices. Visit megaphone.fm/adchoices

Staplecoin values are at all time high. Dexes are at all time high. New token launches that are an all time high. You've got literally everything that you could want from an investing standpoint happening right now, except for a bunch of whiny people on Twitter because they lost 50% on a meme coins. Hi, everyone. Welcome to Unchained. You're no high resource for all things crypto. I'm your host, Laura Shin. We are now featuring quotes from listeners on the show. Today we have one from Crypto Peter B, who responded to to the recent episode on D5

with Stanley Kulachov and Rune Christensen. He wrote Challenge to ETH folks, go one GD conversation, goddamn conversation, I'm guessing, without saying the word Salana or Monolithic. Solana folks do it all the time. They just talk about cool stuff they're building.

Can't remember the last time I heard in East Convo that didn't mention Solana. JFC, rent-free guys. But on YouTube, a pro-Eath listener, Joe Fang, wrote, TLDR, don't bet against Assyrium. To have your comment featured, write a review of the podcast overall, or leave a comment on our video on YouTuber X. This is the February 14th, 2025 episode of Unchained.

Somnia processes over 400,000 transactions per second with sub-second finality, powering scalable, mass consumer apps, and reactive features fully on-chain. Learn more at somnia.network. Today's guest is Jeff Dorman, Chief Investment Officer, co-founder at Arka. Welcome, Jeff. Hi, thanks for having me back. Everyone's talking about how sentiment is down bad, especially on crypto-Twitter, and excluding Ethereum, which is the only top 10 coin that's down year over year. The sentiment we're seeing on Twitter just really seems to belie the actual price action. And I wondered if you

could talk a little bit about your blog post from this week called Fed Up with Misinformation, in which you broke down why you thought, you know, what you're seeing. from the community does not match reality. Sure. Yeah. Every once in a while I write with an angry tone these last couple weeks have certainly been that. Not because prices are down, honestly. Like, that doesn't bother me. I've been doing this long enough, you know, 25 years now between stocks, bonds and now crypto that, you know, I'm pretty numb to markets going up and markets going down. But what really was bothering me the most was that, you know, I've been doing this now professionally at ARCA for seven years. You know, there's a lot of people in this space who have

been dedicating basically a decade of their lives to the growth of blockchain. And a lot of that is on the education front and actually trying to explain what's happening with the growth of blockchain and the growth of this asset. And it just seems like that's all just being drowned out and lost now with a lot of just dishonest and flat out incorrect takes on the market. And I think a lot of that is actually what's causing this break and sentiment from price right now is that the bad information and the misinformation seems to be traveling way fast. than anything that's actually real. And actually, it's funny, I saw Matt Hogan from Bitwise echo something similarly right now.

He had a tweet recently that said, there's an absolutely massive disconnect between retail and professional sentiment in crypto right now, where retail sentiment is the worst that's been in years. But meanwhile, kind of professional investors, especially from the Tradfai world, are extraordinarily bullish, and it's like living in two separate worlds. And we feel the same way right now at Archer because we straddle that line quite a bit between, you know, your sort of native crypto, you know, in the trenches, DGens, and this sort of tradfai world. And the tradfai world is seeing nothing but positive headlines.

They're seeing Bitcoin near all-time highs. They're seeing gold near all-time highs. They're seeing stocks near all-time highs. Interest rates are coming down. The VIX is lower. You've got Trump talking about crypto. You've got the SEC and CFTC becoming more positive for crypto. You've got all these working groups happening.

Like, all they're seeing is the positive. And then, meanwhile, here in the trenches, especially on crypto Twitter and in certain telegram groups, you would think that, you know, crypto has no chance of succeeding, even though objectively, this is the least risky crypto has ever been as an investment asset class in the history of crypto. So it's really striking what we're seeing. And specifically, I'll just give you a couple examples of what I mean by like the bad information that's out there. You know, I don't mean to call out anyone in particular because I just want to happen to be top of my right now. But like, you know, Nidig, for example, is a very crypto native company. Right.

Dydeg has been around for probably most of the decade. They obviously are very entrenched in crypto. And they came out with something last week that basically said, talking about how this is a Bitcoin focused market and alts are getting killed. And alts are getting killed specifically because there aren't any fresh narratives and use cases. And I'm just like, it's 2025. How are we still calling everything that's not a Bitcoin in alt?

I mean, this is an asset class now that has very distinct sectors, right? We have stable coins. We have defy. We have gaming. We have NFTs. We have AI. We have all kinds of different assets within Web3. We have RWAs.

Like, how are we still using this term altcoin? And then how are they saying something like, we don't have any fresh narratives and use cases? The U.S. president just issued a token. An African nation, Central African Republic, just issued a token. There are 22 states that are either pushing for or have. proposed legislation to establish a Bitcoin reserve as well as over a dozen countries.

We have the SEC Commissioner released the most crypto-friendly priority list ever, basically saying that anything that isn't fraud and is currently legal is okay by her. We've got banking leaders like Bank of America and Morgan Stanley and BlackRock talking about how everything's going to be tokenized and how they want to participate more. We have the largest prediction market built on blockchain. We have stable coins at all time eyes. We have new AI agents interacting with each other every day via Crypto Rails and DeFi, and we have decentralized exchange volumes at all-time highs.

So I just cannot for the life of me and forgive me for being so passionate. I just cannot for the life of me to figure out how this misinformation continues to penetrate the crypto world. Well, okay, so I have a theory, and I'd be interested for your take on this. And I think, and I think I've also heard other people talk about this, maybe on some of the shows that we do here, that the reason sentiment is down so bad is because mean coins were the main trend this cycle. And the vast majority of people that have participated in that trend have lost money. So, you know, all the stuff that you're talking about, that's not really like where

retail has been. It's not like what their attention has been on. It's definitely been on this segment where there's been just kind of like mass exploitation. Like I'm sure you saw the Dave Portnoy stuff. Like, it just feels like that's what. the masses are enduring. And all the other things you mentioned are, yeah, you're right. They're very positive. And I would agree with you that when you have a long time horizon, that those are all the things that show we're in this like massive inflection point that is already starting to change the trajectory of crypto. But I feel like when you just look at the number of people who have been impacted either positively or negatively in the last year, the sheer number of people who have

had a bad experience probably outweighs the number who've had a good experience. But that's very short-term thinking, wouldn't you say? I mean, that's over the last four to eight weeks. So that's, no, not four to eight weeks. The meme coin trend has been around for over a year. So I'm so and it's not like I'm disagreeing. I think I'm just like giving a theory as to why we're seeing this disconnect. Right. But okay, but again, this is the part I would I would echo is that it's clear for probably the first time ever that blockchain is here to stay and is not going away and that there are very distinct different use cases of blockchain technology. So mean coins being one of those use cases and not even really a very big use case.

I mean, you know, the size of the meme stocks when you look at GameStop and Bedbath and Beyond at AMC is a very meaningless amount of the total stock market. The same thing with Meancoins. It's a pretty meaningless size of the entire crypto market, yet it just gets to. a disproportionate amount of press time. Wait, wait, wait, wait. So you don't think that there's that the majority of people in crypto that participated this last year were participating in that area?

Well, I mean, you know, the market cap of publicly traded tokens right now is 3.3 trillion. Meme coins is what? 50 billion of that? I mean, you get rid of Doge and it's even less. I mean, it's not a big part of the market. Right. But that's what the big trend was this year for retail is what I'm talking about. Well, but then you're implying that something, you're implying that something that is

less than 2% of the overall market is affecting 100% of the mine share. I mean, that can't be true. Yeah, I mean, I'm talking about retail. Like when people are, you know, trading only like $100 or, you know, $1,000 or even as much as like $5,000 to $10,000, it doesn't compare to the whales. So, like, I think like dollar for dollar, yeah, it doesn't make sense. from that perspective, I'm just talking about, like, actual people. Like, numbers of, absolute numbers of people, I guess is the way to think about it.

But, but, okay, so let's, and again, we're projecting what others think, which is always a dangerous exercise. But if you're trading meme coins, you know, relative to, again, like, there's a difference between investing in a defy platform that has volumes at all time highs, has a buyback program to amortize their tokens, and you can value on a price to sales ratio versus a meme coin. Right. I mean, you know, regardless of what your financial, sophisticated, is, you're not comparing something like, you know, radium, which is buying back its own token and has a real business model with, you know, a bong or fart coin or something like that, right? So there is at least some differentiation, even in the minds of the least sophisticated retail

investor that you might be talking about. So if you're investing or trading in meme coins, it is a form of gambling. There's no other way around it, right? And, you know, anytime you've been to, you know, Vegas and the glitzy, huge, amazing casinos, You know, don't forget, that's, you know, a very small portion of the overall gambling market. The rest of gambling is being done at, you know, a six-foot ceiling casino in Reno or in New Orleans or in some, you know, Native American casino off the highway that has, you know, six people chain smoking by a roulette wheel. So, you know, when you go into gambling, you know that the majority of people are going to lose,

but it is still a form of entertainment and they keep coming back, right? The casinos don't go out of business just because a few, a handful of people, are really upset that they lost money and are loud and obnoxious about it on Twitter. So, but my question is just like, you don't think that that is perhaps a valid explanation for why it is that sentiment doesn't match the actual like fundamentals that are changing. Well, no, I think it's, I think it's beyond just mean coins. I think, you know, in general, if you look at the market from November 4th to December 17th, and I use December 17th as the fulc there, just because that was the day the FOMC came out

and said that we're going to pause the rate cuts. So from November 4th to December 17th, basically everything went up. And a lot of things went up three to 500%. I mean, if you look from December 17th to today, February 14th, it's been the exact opposite. You have things that are down anywhere from 50 to 80%. There's no question that price drives sentiment. And you certainly get to feel a lot better when you're getting richer and you're going to feel a lot worse when you're getting poor.

That's natural. What I'm saying is the sentiment of like this cycle is over and crypto is. is dead because of prices going down. I mean, we've just seen this 15 times in the last five years and it's never been true. You know, if you look at, for example, you know, go back in, I wrote, May 28th was a good example. May 28th, I wrote that the past week, this is May 28th of 2024. I wrote the past week was the most bullish and important week in digital assets, capital markets history because that was when Trump basically did a 180 and started talking about Bitcoin

and using that as a way to, uh, in terms of, um, a way to, uh, in digital assets, capital markets history. increases voter base and ultimately was sort of the beginning of what ultimately took place, you know, six months later with the election. Some thought I was exaggerating, but you know, I think upon reflection, if you look back at May 28th, it really was the most important and bullish week in digital assets market history because it changed the course and the trajectory of blockchain from the old restrictive regime in the U.S. to what we have today. So, you know, naturally you would expect the market to have shot higher on that, right?

Absolutely not. From May 28th, 2024, until the lows on September 6th, the 2004. So you're talking for full three and a half months, the total crypto market cap fell percent and Bitcoin barely fell at all. So if you look at X Bitcoin, it was closer to 35 or 40 percent. Right? During that time, what happened? People were shouting from the rooftops of the crypto was dead and the cycle was over

and that this would never happen again. We all know what happened next. You don't feel like there is any rational reason whatsoever that this sentiment should even exist. Is that what you're like you can't find any explanation for why the sentiment is is like this. No, I mean, investing is really hard when you just constantly are getting things wrong, right? You have a thesis that's invalidated or you have a thesis that's whatever. It's like, oh my God, like we're just getting things wrong left and right.

That's hard, right? For example, let's say you were investing in nothing but like, you know, Navidia and chips and data centers and those that were providing expensive access to building out AI. And then all of a sudden, deep seek comes out and it totally throws your thesis off. You're like, oh, man, I actually rethink my thesis. I'm wrong because, you know, Deep Seek just prove that you can do this cheaper and it's going to use, you know, less chips and it's going to use less data centers. Okay, like that's hard. That's a change in the thesis. But when nothing is, when your thesis is actually being validated to the upside at the same time that price is going lower, that's an all in buy moment. And again, like we've seen it a hundred times in this market where the market is just wrong for a short period of time.

I mean, that May 28th to September 6th period, for example, the market was just flat out wrong. We were down 30 percent. And then from September 6th, and then from September 6th, 6th to November 4th to September 6th to December 17th, the market shot up again like more than doubled from like $1.5 trillion to $3.3 trillion of total market cap in the crypto market. So sometimes markets get it wrong, especially in crypto markets, because it is such a sentiment driven and social driven activity. So again, there are times when prices should be down. Like 2022 was a great example. At the end of 2021, the Fed started raising interest rates.

They raised interest rates, you know, five standard deviations above what anyone was expecting. And counterparties were failing left and right. Like 2022 was basically the equivalent of 2008, where it didn't matter what you were invested in. It mattered who you were invested with because your counterparties were failed. In 2008, it didn't matter if I had the greatest short on in the world. What mattered was did I hold it at Bear Stearns or Lehman or MF Global because they were going out of business? The same thing happened in 2022. It didn't matter if you owned Solana or you own Bitcoin.

If you owned it with Genesis or FTX or Celsius or BlockFi, you were in big trouble, right? That was a reason. That's a reason to panic. That's a reason for markets to go down. If you had a long thesis in 22, you were completely invalidated on that thesis based on real activity that was happening. That is not happening right now. Staplecoin values are at all time high. Dexes are at all time high.

New token launches that are an all time high. You've got literally everything that you could want from an investing standpoint happening right now, except for a bunch of whiny people on Twitter because they lost. 50% out of meme coins. So it's just an insane divergence right now. So you do agree that this sentiment could come from meme coins. I can certainly agree that that is a part of it for sure. I don't know because again, it's a dangerous game to put words in people's mouth, but that's certainly part of it. But I would also say like there are other parts of the market that are down 50 to 60% as well that are not meme coins that are depressing people just as much. I mean, here, I'll give an example.

Robin Hood just came out with like record numbers yesterday. Go look at a chart of Robin Hood. was basically dead, the stock went nowhere from March of 2022 until January of 24. And it has five-xed since then. And every time they come out with new information about how good they're doing and how much their volumes are up and how much their revenues are up, the stock goes up. Coinbase, same thing. It was dead for a year, year and a half. Now, all of a sudden, equity investors are rewarding them because their volumes are up, their revenues are up, right? The stock is going up with the actual growth of the business. Now go look at a chart of like radium or Jupiter or Uniswop or aerodrome or, you know, Hyperlick.

What hyperlinks is an example because it's newer, but you know, you look at some of these dexes that are having the exact same success as their counterparts in the real world, your Robin Hoods and your coin bases and your galaxies, but the stock's down 50% because people are just all lumping it together as if it's one thing. And again, it's fine. Like that's. Yeah. It depends a little on like the tokenomics and stuff too, even.

Everyone, every one of the ones I just mentioned is a real business that uses revenues and profits to buy back tokens. So it is, you know, it's as akin to a stock as you can imagine. And again, like I'm saying that is also driving sentiment in some ways that you're just seeing prices down like this. And my counter to that, as I said, is that that's when you invest. You invest when sentiment is low and fundamentals are higher. That's investing opportunity you will get. And I don't always scream like this from the rooftops when prices down because, again, sometimes prices down just for a real reason. But there have been several opportunities

in the crypto world over the last four or five years where this same thing happens, where you get sentiment down and everything else up, and it is the buying opportunity of a lifetime. Yeah. Well, so in a moment, we'll talk a little bit more about kind of the reaction to some of these trends that have been happening in the space. But first, a quick word from the sponsors who make the show possible. Somnia's high performance blockchain achieves 400,000 transactions per second, sub-second finality and sub-sent fees, perfect for mass consumer applications like gaming, social, and more. Somnia's architecture unlocks reactive features like on-chain event triggers, native timers, and verifiable random functions.

With Somnia, developers can build fully on-chain applications that can scale to millions of users. Start building the app you've been dreaming about with the help of Somnia's $10 million grant program. Learn more at Somnia.network. We have another listener comment, this one responding to Stani Kulachau's assertion, that Ethereum's tooling advantage may set the only choice for complex defy. On X, Yulia Mihailescu wrote, Why leave Ethereum? Why leave any chain? At Laura Shin, the future must be multi-chain.

I know true builders will always start where the big network effects are. That can be Ethereum yesterday, Salonite today, ZZZ tomorrow. But they will always want to reach more. no need to leave any chain, we just need to make sure full interoperability and composability across chains is seamless. Again, if you want to hear your comment featured on the show, please write a review or leave a comment on an episode on YouTube or X. Back to my conversation with Jeff. So I did also have to ask you a little bit more about the meme coins launched by then-president-elect Donald Trump three days before he took office

and Melania Trump. And I'm sure you're quite well aware. A lot of people were not generally supportive of those. You seem to take them as like a bullish sign. What did you make of the fact that people were criticizing them? And why do you feel positive on them? Well, to be clear, I'm not positive on the Trump token itself. I think there's a big difference between the signal and the reality. The reality is he launched a meme coin. It has no purpose. It has no financial purpose. It has no utility. It has no anything other than social box. When I look at evaluating any sort of a digital asset, I'm generally looking at those three things. Does it have financial value? Are there real cash

lows? Are there real revenues? Is there some sort of a buyback? Is there some sort of financial mechanism that I can value this? Or does it have utility value? Meaning, can I use it for something? Can I use it to pay gas? Can I use it for collateral? Can I stake it? Can I do something with it? And then does it have social value? I generally won't invest in anything that's 100% social value and has no financial and utility value and the Trump coin fits that. I don't care of others do, but that's not interesting to me. But what's interesting to me is what it's signaled, which is if the president of the United

States is issuing a token, anybody who is a potential token issuer in the future is now got, it now has a green light to do it. And we saw what the Trump token did, right? They launched it on Mediora. They had, I believe it was Moon Pay, where you could link your credit card and sign off. It was like a million new wallets came into the Solana ecosystem to buy this Trump coin. And guess what? They didn't leave.

If you look at Salana Stablecoins on chain, it wasn't like the money came in, people made money and then took the money off. Solana stable coin on chain is the highest it's ever been. It went from $6 billion to $12 billion. So that's a huge onboarding moment for the market. Even if the specific asset itself, the Trump coin and the Melania coin, I think, are kind of dumb assets, what it did in terms of bringing people in is huge and what it signals for future issuers are huge, right? People who know me, you know, I started writing about crypto in 2017. The first blog I ever wrote wasn't even on our website because we didn't have a website at the time.

And I was talking about how I've been a Starbucks shareholder for, you know, 20 years and I literally don't drink coffee. I get nothing out of Starbucks other than stealing their Wi-Fi and using a bathroom. Starbucks gets nothing out of me because I don't do anything to promote them or help them. It is a completely transactional relationship of me being a passive shareholder and hoping that Starbucks does well by getting nothing out of it. Meanwhile, the things that I use on an everyday basis, I have very little financial rewards from. There's this massive disconnect between customer and shareholder in a lot of cases. Look at like a Venn diagram of McDonald's, for example. The investors of McDonald's are not the customers.

The customers of McDonald's are not the investors. And you could do this same exercise with 100 different entities and organizations. around the world. So my thesis that I've been running with for literally seven years is that eventually every celebrity, every company, every municipality, every sports team, every university is going to issue a token. And you can see where this is going to head one day, right? New York City is going to have a token where that token is going to be used for discounts on the subway and maybe fast pass at JFK and Maguardia. And ultimately, maybe you can use it to get dibs on, you know, using Central Park for wedding pictures or your kid's birthday. And then if there's a surplus in New York City,

maybe they dividend it back to you as a token holder. And all of a sudden, if you want to bet on the growth of New York City, when you live in Argentina, you no longer have to buy a condo in New York City. Like the old way of betting on New York City to grow would be to buy real estate. Now you can actually buy the token. You know, you can see again, like Harvard University is going to issue a token one day. And all the boosters and donors are going to get a token in return. And that token might be able to be used for tuition 18 years later when your kid is older. or you could trade it for Yale token or for, you know, Duke token or whatever. Like the, the optionality and the permutations of what these tokens can be are unbelievable.

I mean, I could literally sit here all day and just list ideas for what tokens are going to be. So I don't like the Trump token or the Mawwanii token itself because it's boring. It doesn't do anything. I don't like the Central African Republic token itself because it doesn't do anything. But that doesn't mean that there aren't creative people thinking about what else. can be done. And for the first time, the Trump token is giving you a green light to actually do it. So I spent a lot of years as an investment banker. Investment bankers are incredibly creative because they only get paid when they come up with creative financing solutions. Well, guess what?

Tokens are the greatest capital formation and customer bootstrapping mechanism we've ever seen. And eventually, investment bankers are going to start pitching these ideas to companies or organizations as a really good means for not only raising capital, but engaging your audience and growing your business. So you look at like what Binance is done, right? Binance is the most successful crypto company ever, going from nothing to a couple hundred billion dollar market cap in a matter of years. Part of it was because of the B&B token, right? They issued the B&B token to their customers. They used a portion of their profits to buy back the token to align their customers with their, with the growth of their business. They'd had the B&B token used so that you

could get discounts on their platform and use it for collateral to trade options and futures. I mean, And everything I just said, it's part financial because you have real cash flows driving the token. It's part utility because you can use it. And it's part social because people actually care about finance. Well, guess what? Every customer in finance became a power user and an evangelist. And that's why finance grew so fast. Like other companies will eventually see that formula and say, oh, just because Trump issued a stupid mean coin doesn't mean I have to issue it in the same way.

I can issue a much more powerful token. And the green light is out there from the president that it's okay to do this. Yeah, well, I agree with you on all of that. I just, yeah, like I was saying earlier, I think the sentiment comes from somewhere, but you're right, we're not going to know. But I did want to ask you about something else that's been a large topic of discussion generally, been creating a lot of controversy. You probably saw Chow Wang of the Alliance style last week and said that over the past year he had seen. portfolio companies launched simultaneously on both atop Ethereum L2 as well as in Solana. He felt that those on the Ethereum L2s had really struggled, whereas the ones that at the same time had launched on Solana had found good traction. And interestingly, I had a discussion with Stani Kulichop and Rune Christensen earlier this week.

And when we released that episode, people were attacking me just for asking them questions about these kinds of things. So I was curious for your thoughts, like, why do you think it is that Ether has struggled price-wise? You know, some people are just saying, like, it's fun and whatever, and others, which I'm sure you know, are saying there's, like, real issues with scaling, fragmentation, U-X, the interests of VL2s and Ethereum, the token are not generally aligned. Salana has been grabbing market share interest for users and des.

Like, you know, what do you think? is happening with Ether? Do you think it's FUD or do you think that there are real problems that need to be solved? So layer one blockchains have always been, and don't forget, you know, I've been doing this for a long time, but I am much less technologically savvy than a lot of people who come through crypto, right? A lot of people come through crypto either in a libertarian lanes or a technological lens. I come through purely from a financial lens and that I enjoy investing in new technologies, no different than I did in the debt and equity world.

I have less to offer in terms of the future of Assyrium versus Salana from a tech standpoint, but I can tell you a little bit from an investing standpoint, which is that all of these layer ones are really, really, really hard to invest it. If you go back to what I mentioned earlier about something has to have both financial value, utility value, and social value, layer ones in theory have all three, right? They have real financial value in the form of MEV and the ability to actually generate transactional revenue when there's apps within the blockchain that are being utilized. I know different than the Apple App Store generating revenue every time there's being built

in there and rent transactions happening. So, you know, as a basically a financial app store, the layer ones actually do generate real revenues and cash flows. And, you know, you can see it with regard to buybacks and burns, but in the case of Ethereum, they clearly have utility value in the sense that you can pay gas, right? You can use it for staking, collateral other things. So they're very useful. And they clearly have social value in the sense that people are pretty tribal around their communities and around which blockchain they care about and which one they support.

Just because I can identify that they have all three doesn't mean I know what percentage of those three is driving price that any given time. It could be only 2% of the prices being driven by financial and 3% being utility and 95% being driven by social. It could be the other way around. So it's very difficult to figure out what's actually driving this. And then on top of it, you have sort of this political stance, right? Meaning, like, Bitcoin, for large parts, kind of stands for libertarianism, right? It's sort of decentralization, sovereignty, fixed supply, hard money. There's definitely a cyberpunk kind of influence with the early adopters.

Ethereum has always been kind of left-leaning, more socialist, more technocratic, right? It's more about Austrian collaboration and the collective efforts. Dow's and, you know, certainly favoring governance more than anything. You know, in some cases, there are even public goods and funding mechanisms and certainly more experimental. Salana, on the other hand, has all been about capitalism and efficiency. It's speed to market. It's how fast can we do things. Its lowest fees has a huge venture capital backing. You know, there's certainly tradeoffs with all those. And it's very difficult from an investing standpoint to really make a bet on any one of these when you recognize that 99% of the world's assets aren't even on blockchain yet.

Like I mentioned, this is about a $3 to $5 trillion industry when you look at all the assets that are available in crypto. The stock bond commodity real estate and currency market is $500 trillion or more. So meaning like the world, if you think about what blockchain really is, it is essentially the greatest mechanism we've ever seen. for moving assets, right? We have a very simple thesis over the next five years of our contract. Blockchain technology has proven to work incredibly well for asset movement and transfer,

but the majority of the world's assets, stocks, bonds, or real estate, et cetera, are not yet available on blockchain rails, partly due to regulatory workflow issues. But those are starting to break down as we're seeing in Washington and elsewhere. So as these barriers between crypto-native assets and trad by assets start to break down, which again, is clearly and unequivocally happening for the first time ever, more tokenized assets are going to be issued and traded and sent on chain. And the beneficiaries of that will, of course, be whichever layer one blockchains end up supporting this growth of these transactions. And whatever defy applications built upon these chains, you get the bulk of those transactions.

Just one question. If you were to have to bet on only one horse, would it be Ethereum or Solana? Well, that's what I was getting at, is that honestly, if I were just only going to bet on one horse, I would pick some random obscure blockchain that trades at $500 million and bet on that one. Because I don't think as big of a lead as Ethereum and Solana have that any of it is actually that big of a deal because they haven't done anything with any of the world's assets that matter yet. So that's what I'm getting at is like a $400 billion Ethereum versus 100 billion Solana versus, you know, random chain X, YZ. We haven't even come close to seeing who's going to be the winner yet. The winner is going to be determined by which chain Walmart uses and which chain the U.S. government uses and which chain J.P. multiple uses.

Wait, you think that the winning chain will be one that takes real, real world assets and puts them on chain? You think that's the future? 100%. I don't know. There are no crypto assets that matter right now. What crypto asset actually matters right now? Name one.

U.S. Treasuries are being moved on avalanche. Yeah, I just, no. So Bitcoin, Bitcoin is the only asset. Okay, the way of it? think about it is I think about how snail mail is completely like practically irrelevant in our lives and pretty much nearly everything that we do all day is all like digital communication. And so I and I also think that real world assets have an issue where they're not natively digital. So there's just like all

kinds of weird random little things that you have to kind of account for when you are trying to move them on chain. Whereas things that are inherently digital, they just have certain advantages. And so I feel like once all this is fully mature, I think that crypto-native assets are going to end up being bigger. And I know it's like a long time scale, but, you know, I... What crypto-native asset besides Bitcoin are you going to be... It's like we're like in 1999 and you're at the dot-com era and you're asking what's going to be important in 2025. Of course I don't know. Like it's probably or maybe it doesn't exist yet, but I'm just.

just seeing that, I do think that eventually, like, digital transactions will be, like, important and much bigger than the, yeah. Let's stick with what you just said. Let's stick with what you just said in 1999. Okay. In 1999, there were new internet native companies that were called dot coms, right? You would put dot com on the end if you were an internet native company, meaning you were a company that would not have existed if not for the internet. And because of the internet, all of a sudden, you could exist. Things like Amazon.com. Things like Pets.com, things like triceline.com and thousands of others that we forget about because they fit, right?

That's not what made the Internet the Internet, what made the Internet, the Internet, is when every other company that has been around for 100 years started using the Internet, right? Walmart became an Internet company, J.P. Morgan became an Internet company. Domino's Pizza became an Internet company. Every government around the world became an Internet company. Every university became an Internet. No, I think the things that define the internet are things like Twitter or like, yeah, just like Netflix, like things that are, they're not like offline things that got an internet website. Like I think they're saying that. Netflix wasn't offline. Netflix wasn't offline thing.

You used to have to go get DVDs in the mail. But it was in Netflix. It was a Netflix. Netflix was literally, you would sign up for either one CD, three CDs or five CDs or one that they would send them to you in the mail. This way. It doesn't matter what Netflix's personal history was. It's more like Netflix only became a success once it was just purely digital, right? Right. But that's the point. You took a non-native internet business called Netflix and they became an internet business by utilizing the internet. So the same thing is going to be true. Right. So, okay. So 30 years from now, 30 years from now, you think, like obviously this is like, obviously this is like, like too long a time scale for a bit. But you do think at that time it will still be like

ChadFi assets just in an on chain wrapper will still be bigger than crypto. Okay. Yeah. One thousand percent. So, so, okay, well, you would never call something a dot com right now, right? Because you'd be laughed out of the room. That'd be insanely stupid to call something at dot com. Because everything is a dot com now, right? So that's where that's where we are in crypto right now. The last seven years of crypto was your dot crypto era, right? That was the era where the only things that existed in crypto were native crypto businesses called dot crypto. You literally would not have existed if not for crypto and blockchain.

And now you do. The next 27 years are going to be regular companies who are using blockchain. They're going to put the assets that people care about. Guess what? As much as Solana is some cool thing, it's $100 billion. Tesla and Navidia and Facebook and Microsoft and Microsoft. and Microsoft and all these other companies are trillion-dollar companies. Look at October 8th, I think.

October 8th was the day, hold on, let me finish me if you don't mind. October 8th was, I think the day, or October 6th was the day when the yen carry trade was breaking down and you had massive volatility and futures down 7% overnight and you wake up Monday morning and every bank and brokerage account was down because of the volumes, right? That should have been the biggest onboarding moment in Defi's history because Defi worked flawlessly while everything else was down. But guess what? Nobody cared because nobody was rushing to trade Solana or Fartcoin on a day when their

portfolio was getting killed because the Yen-Carrie trade. Now, if you could have taken your NVIDIA stock, or you could have taken your oil futures, or you could have taken your Tesla stock off of your brokerage account into DeFi Rails and traded it, it would have been the biggest onboarding day in history of crypto. But it didn't happen because the assets that people care about are not available yet on blockchain. So all I'm saying is like, I don't care about a fuel or salmana. Like once this technology is mature, I don't think that the assets we care about now will be the same ones that matter at that point in time. Because if we look at the Mag 7, these are all things where they're like internet native. Like they're not, you know, so I do think it like, I don't know, is it two decades, 25 years?

Like I don't know the exact timeframe, but I do think at some point in history it will be that the crypto native assets end up being bigger than the ones that are analog that eventually go on chain. It's just my opinion. I think there'll be a couple. But priceline.com is huge. Amazon.com is huge. Those were a couple of internet native companies that actually became big. But again, the majority of the internet usage of today's world is not because of internet native companies.

It's because of regular companies and regular people that use it. So I actually love the fact that we disagree. I can't wait to do your show in 10 years and see who is right. Well, I don't think it'll happen in 10 years. I think it'll be more like 2530. So, you know. I always go back to the Bill Gates, that said people, people tend to overestimate what can be done in a year and underestimate what can be done in 10.

Like, I think, again, like, I think the, I think the tipping point that we just hit in the last six months with this Washington overhaul that is basically allowing native assets to be brought on chain. I mean, again, like, not just the new coins, not just your Trump coin or your Central African Republican point or all these coins that talk about there to be issued in the future. Like, Larry Fink at BlackRock is outright telling everyone we want more tokenized assets on chain. the CEO of Robin Hood, literally just last night on the earnings call, said, we want to see more assets on chain. Like we just hit a massive, massive, massive, massive, massive tipping point. I cannot underestimate or under-emphasize what I mean by that. Like a massive tipping point in the fact that all of these things that we've been talking about for years that could be now actually can be. And I really believe that the majority of the assets people, the majority of the assets people care about are not crypto-native assets.

Like for every Bitcoin, there's a thousand of the devices nobody cares about. Right now. Yeah, we'll see. I mean, I don't know if I'll still be around in 30 years. I'll probably be like pretty darn old. So hopefully I won't be doing this. But anyway, Jeff, it was so fun chatting with you and sparring with you. I really enjoyed our chat.

Thank you so much for coming on Unchained. Thank you for having me. I always appreciate being here. Don't forget. Next up is the weekly news recap today presented by WonderCraft AI. Stick around for this week in crypto after this short break. Behold Kauai Network, born of proof of work, a layer one to end the system's Merck. With energy and currency entwined, the first energy dollar is designed. Decentralized, it stands both stable, strong. To scale commerce, the globe sought so long. Unstoppable, it fuels the defy dream, where global trade and power cross the stream. Kauai carves paths for monetary change, a platform where these forces rearrange, sustainability and money blend. Discover how at QU.A.I transcends.

Welcome to this week's Crypto Roundup. In today's recap, we cover the latest push for Ethereum ETF staking, the Trump administration's shift from a crypto council to industry summits, and Ripple and Galaxy Digital stepping in with a $160 million loan, to keep the Trump meme coin frenzy alive. We also break down Hester Purse's take on meme coin regulation, Brian Quintenz's nomination to lead the CFTC, and Franklin Templeton's move into Solana ETFs. That's not all.

Uniswap has launched its own layer two blockchain, BitGo is weighing an IPO, and the Central African Republic's meme coin launch took a dramatic turn. Plus, OpenC is rolling out OS2 and teasing a C-token air drop. And in the fun bits, CZ's dog broccoli has become crypto, newest sensation. Because why wouldn't he? Thanks for tuning in to the weekly news recap. Let's begin. CBOE seeks SEC approval for staking in 21 shares. Ethereum ETF. The 21 shares core Ethereum

ETF could become the first U.S. ETF permitted to stake its ether holdings if a Form 19b4 filing made by the CBOEBZX exchange to the U.S. Securities and Exchange Commission is approved. The filing, which was made this week, proposes a rule change. that would allow staking in the fund. According to the filing, staking would be conducted through a streamlined point-and-click method, aiming to minimize operational risks. Bloomberg ETF analyst James Seifart noted the significance of the request,

stating on X, I believe this is the first ETF to file with the SEC and request the ability to permit staking. The announcement triggered an immediate 6% rally in Ether's price, pushing it to an intraday high of $2,796, on Wednesday. The SEC's decision remains pending, with analysts speculating on a potentially more crypto-friendly regulatory approach under the new administration. Trump administration re-thinks crypto-counsel, eyes industry summits instead. The Trump administration is reconsidering

its plan to establish a formal crypto council, opting instead for a series of industry summits, according to sources who spoke with Unchained. The decision aims to prevent internal conflicts within the crypto sector by allowing a rotating selection of industry leaders to discuss key policy issues. While details remain unclear, early summits are expected to focus on banking, payments, data centers, and Bitcoin mining. Sources also confirmed that trade associations have played a role in shaping these discussions. Trump initially promised a presidential council of advisors for digital assets in December, with David Sachs's chair and Bo Hines as executive director. However, Hines has reportedly been exploring alternative approaches in meetings with policymakers.

Reactions to the shift are mixed. Some view it as a pragmatic way to gather expert insights, while others question whether the summits will have any real policy impact or merely serve Trump's business interests. Ripple, Galaxy loan $160 million to Moon pay to sustain Trump meme coin surge. Ripple and Galaxy Digital stepped in with a $160 million loan to help. helped Moonpay manage overwhelming liquidity demands following the Trump meme coin launch on January 18th. The sudden spike in trading activity pushed the token's market capitalization from $200 million to over $10 billion in just 48 hours. But Moon Pay faced a major hurdle. It couldn't access

its Fiat reserves due to a holiday weekend. Moon Pay CEO Ivan Soto Wright and President Keith Grossman first secured $100 million from Galaxy Digital, with Mike Novagrats personally overseeing the deal. As demand surged further, Ripple CEO Brad Garlinghouse provided an additional $60 million, ensuring MoonPay could continue operating. The meme coin craze also led to the launch of Melania Trump's Melania token, further straining Moon pay's liquidity. The company successfully repaid the loans on January 21st after onboarding 750,000 new users during the frenzy. SEC's Hester Purse says meme coins likely fall outside agency's jurisdiction. Hester Perce, head of the SEC Crypto Task Force, said in a Bloomberg crypto interview

that many meme coins may not fall under the SEC's regulatory authority. Perce explained that while each case would be evaluated individually, many of the meme coins that are out there probably do not have a home in the SEC under our current set of regulations. Perce suggested that Congress or the Commodity Futures Trading Commission might take on the task of defining regulatory guidelines for meme coins. The statement comes amid growing concerns over the high volatility of tokens, such as Trump and Melania, both of which saw massive surges before crashing over 7% and 89% respectively.

As the SEC awaits the confirmation of a new chair, PERS also remarked that formal rulemaking on broader crypto regulation could be a little premature at this stage. Brian Quintens tapped to lead, CFTC. Brian Quintens, a former CFTC commissioner and current head of policy at A16C crypto, has been nominated by President Donald Trump to lead the CFTC, according to a White House document viewed by Unchained. His appointment could significantly shape the regulatory landscape for crypto markets

as lawmakers pushed to expand the CFTC's jurisdiction over digital assets. Quintens, who served at the CFTC from Toronto, 2017-21 has been a vocal supporter of decentralized finance and industry-led regulatory frameworks. Brian has a long track record of supporting Defi and advocating for sound policies that will enable defy developers and users to thrive, said Miller Whitehouse Levine, CEO of the Defy Education Fund. His nomination comes as Congress considers market structure legislation that could shift regulatory authority from the SEC to the CFTC, a move supported by pro-criminal lawmakers and industry leaders aiming for clearer oversight in the U.S. Franklin Templeton and

Grayscale push for Altcoin Spot ETFs. Franklin Templeton has officially entered the Solana ETF race, registering its Franklin Solana Trust in Delaware on February 10th. The firm joins a growing list of asset managers, including Grayscale, Canary Capital, Bitwise, Vaneck, and 21 shares seeking regulatory approval for Spot Solana Exchange traded funds. Meanwhile, Grayscale Investments has filed a 19-B-D4 submission with the SEC for a spot Cardano ETF under the ticker GAADA. If approved, it would be the first US ETF providing direct exposure to Cardano. Bloomberg ETF analysts James Safart and Eric Balkunas have increased approval odds for several crypto ETFs following SEC leadership changes, now estimating a 70% chance

for Solana ETFs and a 75% chance for Dogecoin ETFs. Also, Franklin Templeton is expanding its $594 million money market fund to Solana. Uniswap launches Unichain. Uniswap Labs has officially launched the Unichane Mainnet, a layer 2 blockchain built on Ethereum, designed to enhance defy transaction speed and reduce costs. The network is built using Optimism's OP stack, making it part of the growing Optimism superchain ecosystem. Unicane aims to cut gas fees by 95% compared to Ethereum's mainnet, while offering block times of one second, with future upgrades targeting 250 milliseconds speeds. BitGo reportedly, considering

IPO in 2025. BitGo, one of the leading institutional crypto custody firms, is reportedly exploring an initial public offering as soon as the second half of 2025. According to Bloomberg, the Palo Alto-based company is said to be in discussions with potential advisors, though no final decisions have been made. Founded in 2013, BitGo provides custody, trade, borrowing and lending services for digital assets, serving over 1,500 institutional clients across 50 countries. The firm processes around 8% of all global Bitcoin transactions by value. According to its website, BitGo's last funding round in 23 raised $100 million, valuing the company at $1.75 billion, with backers including Goldman Sachs,

DRW Holdings, Red Point Ventures, and Valor Equity Partners. If the IPO proceeds, Bitgo would join other crypto firms such as Gemini, Cracken, and Circle, in seeking public listings amid a more favorable U.S. regulatory environment under the current administration. Central African Republic's meme coin launch sparks skepticism. The Central African Republic launched its own meme coin, Carr, on February 10th, with President Faustin Archang Chouadera announcing the project on X. He described it as an experiment, meant to unite. people and raise the country's global profile. The token debuted on Solana-based launchpad pump

dot fun, following Carr's prior embrace of Bitcoin as legal tender. However, the launch was quickly met with questions over its authenticity. A deepfake AI detector flagged Tuadirah's video announcement as suspicious, and the token's official X account was suspended. The president later stated that the government was working with X to restore the account and emphasized that the token's supply was locked using Streamflow's infrastructure. Despite early momentum, cars' price plummeted nearly 97% within 72 hours, falling from $0.89 to $0.24.00s of a cent. According to Dex, Screener, OpenC confirms C-Token AirDrop. NFT Marketplace OpenC has launched OS2, a revamped trading platform that integrates NFT in token trading while supporting 14 new blockchains, including Ethereum Layer 2s, such

as Sony's Soniaam and Bored Apes, Ape Chain. The update is part of OpenC's efforts to reclaim market dominance after facing stiff competition from platforms like Blur. As part of the upgrade, OpenC confirmed an upcoming C-token AirDrop, with allocations based on historical platform usage rather than recent activity. US users will be eligible, though specific distribution details and timing remain undisclosed. OS2 will introduce reduced marketplace fees, meaning open-seas cut will be slashed to 0.5%, and it will also enable cross-chain purchases. Time for fun bits. Move over Dogecoin. There's a new top dog in town, literally. Binance founder Chung Peng, Z, Zhao has set the crypto world on fire by revealing the name

and face of his pet Belgian Malinois. Broccoli? Yes, broccoli. In a heartwarming post on X, Z recounted how he unexpectedly received the dog from a zoo-owning friend and picked the name because it starts with a B and has some green in it. He even joked that it has a blocky sound because even Z's dog can't escape crypto references. Naturally, the meme coin frenzy erupted instantly, with traders racing to launch broccoli-themed tokens on BNB chain. While CZ insists he's not launching a coin, he hinted at the BNB Foundation rewarding the best broccoli memes. And that's all. Thanks so much for joining us today. If you enjoyed this recap, go to unchained crypto.bhive. That is unchained crypto.behave.com and sign up for our free newsletter so that you can stay up to

date with the latest in crypto. Unchained is produced by Laura Shin with help from Juan Aranovich, Matt Pilchard, Megan Gavis, Pamma Jumdar, and Margaret Curia. The weekly recap was written by Juan Aranovich and edited by Kari McMahon. Thanks for listening.