Unchained - How Texas Got Bipartisan Support to Buy $10 Million Worth of Bitcoin - Ep. 859

Episode Date: June 27, 2025

Win a free one-year subscription to Bits + Bips Premium by completing our survey!  The state of Texas just passed a law that creates a $10 million strategic Bitcoin reserve. Laura talks to Lee Bratcher, president of the Texas Blockchain Council, who helped drive this new law. He explains how bipartisan support made it possible, why this might be the start of a broader trend, and what’s next for public Bitcoin ownership in the U.S. We get into: The logic behind the $10 million number Why custody and compliance are key Whether California or Illinois could ever do something similar And how other states are reacting Visit our website for breaking news, analysis, op-eds, articles to learn about crypto, and much more: unchainedcrypto.com Thank you to our sponsors! FalconX Ledn Guest: Lee Bratcher, President and Founder of the Texas Blockchain Council Links: Texas Blockchain Council Bloomberg: Texas Gov. Abbott Signs Bill to Create State Bitcoin Reserve Unchained: Senator Cynthia Lummis on Why Crypto Now Has Bipartisan Support Timestamps: 🎬0:00 Intro 🏛️ 2:12 How the idea for a $10M strategic Bitcoin reserve became law in Texas 💰 5:42 Why lawmakers settled on $10 million—and what that number really means 🔐 8:59 How Texas plans to custody its bitcoin, and why it matters 📉 10:59 Why the bill includes language about using derivatives for BTC 🏦 12:12 What exchange the state might use to actually buy the bitcoin 🗳️ 14:59 Who owns crypto in Texas—and whether politics play a role 🤝 18:05 Why Bitcoin isn’t such a partisan issue in the Lone Star State 🧡 22:20 How Lee Bratcher got orange-pilled into Bitcoin 📜 24:38 Why Lee thinks the Lummis-Gillibrand bill could pass, and the future of bitcoin bonds 🌎 27:45 Which state might be next to adopt a Bitcoin reserve law Learn more about your ad choices. Visit megaphone.fm/adchoices

A couple years ago, we did a survey of Texas likely voters, and it was a pretty large survey through a third-party surveying firm. And we found pretty equal support amongst various political parties, Republicans, Democrats, and Independence. Now, where there was a huge divergence was demographically from the age perspective. About half of Texans under the age of 30 own some sort of digital asset, which is way above the national average. Well, above the national average for any age, but only around 6% of Texans over the age of 70 do. So that's where you get, Texas is probably close to the national average of, you know, between 18 and 22% digital asset ownership, you know, depending on what survey you're looking at. But it is highly age dependent, but it's not really party dependent. Hi, everyone. Welcome to Unchained.

your no hype resource for all things crypto. I'm your host, Laura Shin. Every episode, we feature listener comments and reviews of the show. Here's a comment on Apple Podcasts from Fewer to Fus, who wrote, Unchained, The Chopping Block and Bits and Bips are a wonderful trifecta of Signal in a noisy, crowded space. Thank you for having the timeliest guests and most relevant conversations about crypto for folks in the industry on the internet. To have your comment featured, write a review of the podcast overall, or leave a comment on our video on YouTube, Farcaster, at X. This is the June 27th, 2025 episode of Unchained.

Imagine an AI that speaks crypto and does the work of a team of analysts. Introducing Focal by Falcon X, bringing in clarity to a world of noise. Visit askfocal.com. Lutton is a leading platform for Bitcoin-backed loans, offering a secure and transparent way to unlock liquidity without selling your Bitcoin, issuing loans since 2018 and earning over. over 1,000 trust pilot reviews. Learn more at leaden.io. Today's guest is Lee Bratcher, president and founder of the Texas Blockchain Council. Welcome, Lee. Hey, Laura. Thanks for having me on. So this week was a big week for the state of Texas. The governor signed into law a bill for

Texas to establish a strategic Bitcoin reserve. And you are one of the originators of the idea for this to happen. So why don't you go ahead and tell us a tale how it went from inception to fruition. Yeah, it's been a long time coming. The idea started years ago, just with conversations with various people. Chairman Giovanni Capriaglione is a House Chairman of the Doge, the newly formed Doge Committee in the Texas House of Representatives. Before that, he was the chairman of the Financial Services Committee, and we've worked with him for a long time. And there's also a lot of Texas Bitcoiners Zet had asked me and we had conversations with me about how do we get Bitcoin on the balance sheet of the state. And initially, we thought that we were going to have to form a

charitable trust and get Bitcoin donations into the trust and have the Texas Comptroller or the rainy day fund be the benefactor of the trust. And what year was that? Those ideas were probably conceptualized in 2022. And we started to get some legal work done around creating that trust, the entity formation done. But thankfully, we never raised any Bitcoin because Chairman Caprilyon came to me maybe a year ago or nine months ago, probably. And we were actually having a conversation on stage at our summit, the North American blockchain summit.

I said, Mr. Chairman, do you think that a strategic Bitcoin reserve is ever in the cards for Texas? And he said, you know, I think the political wins are changing. and I think now is the time to attempt it. And just with everything that happened in the election in November, we had strong tailwinds going into the legislative session. And so they actually got a really low bill number, which, as you know, Laura, like low bill numbers mean priority bills,

especially in like state houses. So it was Senate Bill 21. And there are, you know, many thousands of bills that are filed. So to have a two-digit bill number is a really strong start. And so why do you think there was such strong support coming into this legislative session? No, I think a lot of it has, well, the time passing from FTX has been very helpful. Texas elected officials have been very bullish on innovation and business for a long time. And to their credit, they never wavered away from that.

but there was a noted, noted decline in interest or sort of a, maybe a pause for a while after FTC. And so that was very helpful, just the passage of time post-FTX. And then, of course, the Trump administration in Texas being a Republican state, Lieutenant Governor Dan Patrick is very close to President Trump, as is Governor Greg Abbott. And so I know there were conversations had there. And so the efforts that people like David Bailey at Bitcoin Magazine and others were doing at the federal level really do make a difference on a state level policy. And, you know, there's created a pathway for us to actually get this bill filed in such an aggressive form. And so how was the $10 million figure that was allocated to purchase the Bitcoin? How was

that decided upon. Yeah, initially, there was going to be a donation component to the Strategic Reserve, and that was even separate from our initial trust concept. This was going to be in the bill itself. And some of the elected officials, some of the state senators, were cautious about that. They just said, why don't we just buy it? We don't want to risk people donating and risk sort of the conflicts of interest that that could entail. And I was quite pleased with that because that means I wasn't going to have to go around

twisting arms trying to get people to donate to the reserves, which I was prepared to do, but not looking forward to do. And so that, the Senate removed that portion of the bill when it passed through that chamber. And then the appropriation actually came separate from the bill. It was part of the budget appropriations bill, which is, again, a completely separate bill. And I think initially they were just trying to determine what's a good amount that's meaningful that allows the state to understand the technology more, especially from a custody perspective and compliance tracking perspective, but also something that's pretty negligible for a state like Texas that has a $250 billion budget. So $10 million is 0.004% of our annual budget.

So if anybody has qualms about spending taxpayer dollars, Texas has a budget surplus. We're constitutionally required to run a budget surplus. We cannot go into deficit. And so we have a rainy day fund already. There is a surplus that gets invested in different things. And so this is just along those lines where it's creating a special fund to be administered by the comptroller and the Texas Treasury Safekeeping and Trust Company, which is a quasi-pocket. public entity that sits alongside the Comptroller's office. And so it's a long-term strategy, buy and hold. And I think, you know, the 10 million figure was a very conservative figure for the

state. And have they decided on ways that they will fund that $10 million? That is the million question or the $10 million question, I guess. So we, there is a provision in the bill that allows for the Bitcoin exposure to be purchased through ETS at the Comptroller's discretion. But both the House side and the Senate side offer and really the legislature in general has said that's not their legislative intent. They wanted to provide maximum flexibility to the Comptroller, but their legislative intent is for them to buy Bitcoin the asset and hold the keys in a sense, whether that's through a custodian or through multi-sig or through multi-institutional custody, The comptroller has wide discretion on how, but we certainly, you know,

ETF exposure is not the goal of the bill. The bill is to actually hold the Bitcoin in one of those three routes, either through a qualified custodian, multi-institutional or multi-signature. And do you have a preference for how the state custodies that's Bitcoin Reserve? You know, I might get in a little bit of trouble if I answer that question because we have a lot of member, you know, we're the Texas blockchain. the Councils of Trade Association. So we have a lot of member companies that we have calls with on regular basis. And many of them are vying for this business. And so we're trying to make it as fair as possible, making the introductions, you know, having calls with these companies. And these are names that you guys would know, like Coinbase and Anchorage and Cracken and blockchain.com and unchained capital and on ramp and companies like that. Right. So they're professional custodians. And we're just hopeful that they all put in, you know, aggressive bids.

And the state of Texas has a reason to learn about public and private keys and holds a private key in some capacity. There's a lot of ways that they could do it. And do you happen to know which direction the state comptroller is leaning or like how they're thinking about answering that question? You know, it's interesting because the comptroller just resigned, and in a few days, he is going to become the new chancellor of the Texas A&M university system. So he's going to take a big job, and a new comptroller is being appointed by the governor. His former state senator, Kelly Hancock. So we're excited to get to know him more. I already know him pretty well.

He's a high integrity public official and I think really well suited for the job. And so I have not yet spoken to him about this. He was just appointed. The governor indicated that he was going to be appointed at the end of June, and I think his appointment will be final around the 1st of July. So it's very fresh and kind of a we're looking forward to those conversations to be sure. And I did hear, I think you said this on another recording that the Texas state control can also use derivatives.

to gain exposure to Bitcoin. So do you know what derivatives were intended by that language or like, like, why is that in there? Like just from the way you're talking about, you know, owning the keys and stuff like that, obviously that would be a totally different way of going about it. That's right. Yeah. Part of that is actually constitutional and statutory. The legislature can't tell the comptroller how to execute certain functions of his or her office.

his or her office. So part of that was they had to give maximum birth for the comptroller to use the, you know, the standards that are typical for, you know, prudent investor standards essentially that the comptroller must follow. So they wanted to give them the comptroller enough latitude so that they could be within the bounds of their prudent investor standards. So I don't think there's any intent to use derivatives, but that language was just to give them that amount of latitude.

Okay. And I did also hear that there were some considerations about, like, which exchange the state uses to purchase the Bitcoin. So can you talk about what those requirements are? Yeah, in the bill, they describe it as a liquidity provider, but you and I and your audience would know that as an exchange. There are a couple of different requirements that, that are open to interpretation. So the liquidity provider-slash-exchange has to be in business for five

years or more, five or more years. They have to have principal office in the state of Texas. Now, whether that just means have an office in the state of Texas or be domiciled in the state of Texas is not elucidated in the bill. So I'm assuming the comptroller is going to have some discretion. And I think the intent there is to make sure it's just not a company that's predominantly domiciled and overseas or something like that. But I would imagine that all of the exchanges that we know that are based in the U.S. would be eligible, assuming they have an office in Texas. And of course, you know, most of the major exchanges do have employees here. Cracken and Coinbase have a big presence here. Crypto.com actually has their headquarters in Texas.

their U.S. headquarters anyways. And blockchain.com has a strong presence in Dallas with the sponsorship of the Dallas Cowboys. We're hopeful that whatever exchange the state of Texas goes with, you know, has a strong commitment to the state of Texas into the United States. Markets are ripping, but not every pump is created equal. You need to make sense of the action and what's coming next. But where do you start?

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on YouTube, Farcaster, or X. One other thing that I was so curious about is, as we discussed, you know, you've been trying to get this bill passed for a while, and you said that there was sort of like a change in the wind when Trump was elected. And I was just so curious to hear kind of like, you know, over these past,

few years, how you've seen the politics over this bill over crypto generally, how you've seen that play out. Yeah, it's been fascinating. I think a couple years ago, we did a survey of Texas likely voters, and it was a pretty large survey through a third-party surveying firm. And we found pretty equal support amongst various political parties, Republicans, Democrats, and Independence. Now, where there was a huge divergence was demographically from the age perspective. About half of Texans under the age of 30 own some sort of digital asset, which is way above the national average. Well, above the national average for any age, but only around 6% of Texans over the age of 70 do. So that's where you get, Texas is probably close to the national average of, you know, between 18 and 22% digital asset ownership, you know, depending on what,

survey you're looking at, but it is highly age dependent, but it's not really party dependent. And the politics have fallen on similar grounds where there's a lot of younger members of both parties in the Texas legislature that understand digital assets. And this bill was widely bipartisan. Twenty-six out of the 31 state senators voted in favor. And about a hundred and two 203 of the 150 state state House members voted in favor from both parties. And there was actually more Republicans that voted against it in both chambers. So in the state Senate, it was four Republicans and one Democrat that voted against. And in the House, it was kind of a similar ratio, but it was more so evenly split.

And I think that's more around kind of a randomized sample of who's done the work to study it. So I guess it attests to the fact that this industry still can remain nonpartisan, even though there's been some forces and some things happening in the zeitgeist that have maybe called that into question lately. It's really about who's taken the time, who's read the books, who sat down and educated themselves with their staffers or with industry advocates. And we typically find that younger members of both the House and the Senate are, are more interested in this. Not to say that, you know, some of the biggest champions of this

bill, I mean, Lieutenant Governor Dan Patrick was a big champion of it, and he's not a spring chicken. I don't know his age off the top of my head, but he's been in politics for a very long time and has the gray hair to prove it. So, you know, it just kind of goes to show it is all about education. And I think people have known that for a long time, but something as nuanced as digital assets requires so many hours of education that it's just really hard with all the competing interests that these elected officials have. Yeah. And by the way, just out of curiosity, do you think that, like, can you attribute any reason to why it is that in Texas, at least, there isn't like necessarily such a divide between Democrats and Republicans? And I know

you talked about the age thing, which obviously in the federal, at the federal level, we do see, especially in the Democratic side, that there is an age gap. But, you know, why is it that it's kind of like similar across both parties in Texas? Part of it is there's a couple of reasons. I'd say, one, there's a little bit more bipartisan or nonpartisan work in the state legislatures across the country. You know, Texas will pass on average around 10% of the bills that get filed. And that number and the federal government is way, way less than that. They're just a lot more gridlock at the federal level. And the state has things that are, they need to take care of related to like water infrastructure

or things that are that are broadly seen as nonpartisan or maybe they're geographic. And perhaps, you know, you have members of both parties that are from the Dallas-Fort Worth area that are very supportive of an issue. and members of both parties in Houston that are on the other side of that issue. So you also have a little bit of that where it's more like the House members from Dallas that are Democrats and Republicans

work together on issues, and they build that cross-the-isle camaraderie. I think that happens more at the local level, whereas in Congress, it's just so much more geographically distributed across a much larger space. and, you know, the gridlock is structurally permanent, it feels like. Let's hope it's not actually permanent, but yeah, it feels that way. So I'm sure that you're probably in this position now where a lot of, you know,

people who want to do similar things in their own state are reaching out to you. Or maybe you also, I don't know if you, you know, talked to people that did similar things in Arizona, New Hampshire. But just, yeah, just give us a peek behind the scenes about what's going on at the state level. Yeah, so New Hampshire did beat us to the punch. I've got to shout out, Representative Keith Ammon there in New Hampshire. He championed that effort and their bills passed. We hope to beat him as the first state that will buy Bitcoin for the exchange because I don't think they have an appropriation in New Hampshire. But that's just a little friendly rivalry there between the live-free or die state and the Lone Star State.

Arizona did pass some great legislation. It was more around unclaimed security or unclaimed digital assets. And so some people have been looping that in as a reserve, like Bitcoin Reserve bill, but it's not quite to that threshold. It more pertains to when an exchange perhaps can't find their customer, they can't contact them. perhaps they've passed away without a will or what have you.

And those assets go to the state until they're claimed either by the original owner or that owner's descendants. You know, so that's kind of what went on in New Hampshire. The governor, excuse me, in Arizona, the governor of Arizona actually vetoed the original strategic Bitcoin Reserve bill that passed there, passed both chambers. And she ended up vetoing it. So that was, I think, a challenge for the advocates, digital assets advocates in Arizona that have worked so hard for that. And then there's 26 other states that have proposed legislation.

I know Oklahoma got really close. There's a lot of other states that got close. And a couple other states that have sessions that are still going. Of course, the Texas session is over. But there's other states that have sessions still going where they might still pass legislation. And we do all talk. I mean, there's state associations in about 30 different states. And we have coordination called.

We're actually coordinated through an entity called the North American Blockchain Association, which is kind of a vehicle for sharing best practices amongst the state associations. Okay. Well, you know, I'd be curious to also hear like your story, how you got into Bitcoin and how you came to, you know, be president of the Texas Blockchain Council. Yeah, I was not a super early adopter. I was a political science professor in, you know, around 2015. and an Army Reserve officer. So I was studying at the Army War College at the Peacekeeping and Stability Operations Institute.

And I was studying property rights and really doing a lot of digging around the data about property rights and the increase in property rights leading to greater human flourishing, less likelihood for conflict, interest in conflict especially. And I discovered the Bitcoin white paper then. And, you know, my view. as of Bitcoin was from an academics perspective around property rights. And I really resonated with the Austrian economics piece, the digital property rights piece where you could have a very instrument that's digital and non-replicable, scarce, if you will. And so that's where I

started. And I wrote my PhD dissertation on blockchain for land administration. And so trying to understand how blockchain can be used for more accurate and quick record keeping, transparent record keeping, specifically in the developing world because in the United States, we have pretty robust land administration and very strong property rights, not to say that we couldn't benefit from increased transparency and lower transaction fees. When it comes to real estate, we certainly could. We have very high real estate transaction costs. but I think the developing world has more to gain because there's about $20 trillion worth of land

in the developing world that is improperly or untitled. And so their owners can't enjoy the fruits of their labor as much if they don't have confidence in their property rights over that land, that they would ostensibly improve or make more productive if they did have those property rights. Were you studying Hernando de Soto's work? Because, like, yeah, I think he talked about that problem. And then I think got interested in blockchain stuff. That's exactly right. Yeah.

And that $20 trillion figure is actually from Hernandez de Soto's research. And so his book, Mystery of Capital was pretty seminal in, that's kind of a corner piece. You know, part of my research was derived, of course, from lots of different sources. But that one was very, very seminal. And, you know, he's. He's a gifted economist and really respect him. I'm glad he's interested in Bitcoin and blockchain as well. All right.

Well, are there any tips that you would want to give to, you know, anybody else, whether it's these other states or people in those states who would like to see something similar in their state, or even if you want to say anything about kind of, you know, where things are at the federal level regarding this issue? Yeah, we do work with our federal counterparts on this and, of course, with Texas delegation to Congress. And I'm optimistic that, you know, Senator Lumas's bill, you know, we might actually see the country invest in Bitcoin. Of course, the current ways of doing so are budget neutral as per, you know, President Trump's executive order. And there's a lot of creative ways that that's being considered. And, you know, BitBonds being one of the most interesting, Matthew Pines and several of his co-authors

wrote a great white paper on BitBonds, especially as it pertains to the federal government employing them. Of course, municipalities and other entities can employ Bitcoin bonds as well. And that's gaining some traction. I know there's still more work to be done from the Genius Act, Clarity Act. We have a lot of mountains to climb in Congress before we take on, you know, expanding the national deficit to buy Bitcoin. So that leads me back to the states a little bit. Only states that have budget surpluses would probably be in a position where they could do this.

I would highly doubt that you would see a state like California or Illinois be in a position to buy Bitcoin because they've got unfunded pension liabilities and other. things that would probably the voters would be well placed to, you know, maybe have some concern about that. And there could be some reasonable arguments to be said that, hey, we should fund these pensions first. And maybe the pensions should have a significant allocation in Bitcoin. And many pension funds are. I know right outside of D.C. in Fairfax County, that was one of the first pension funds to buy Bitcoin. And that's obviously done really, really well for them. So definitely heartened to see a lot of the pension funds buying Bitcoin.

But I'd say if your state doesn't have a budget surplus, if you have a significant budget deficit, it'd be a hard sell and would require a lot of political capital to get something done. All right. Well, so we'll have to see. Well, actually, so for that reason, would you be willing to project which state you think would establish a reserve next? Oh, I don't know. I know North Carolina is always doing great legislation. Florida has some stuff in the works as well. And it could be one of the blue states, you never know.

We've got some great state associations that are operating in blue states like California, and purple states like Pennsylvania and others. But I would probably say it might be a state like, Ohio or Florida, we typically, you know, tend to pass legislation that's in line with the party that's in power in the House and the Senate for that particular state. So those being red states, I think that they would probably have a better chance than a blue state. All right. Well, we will have to see what happens. Ohio is my home state. So I'm very curious about that. All right. Well, thank you so much for coming on Unchained. Thanks for having me, Laura.

coming up we have insight into the coming perps battle in the U.S. with Unchained Executive Editor Steve Ehrlich. Stick around. I'm here with executive editor, Steve Ehrlich. Steve, you read a really interesting article about how Hyper Liquid has revitalized interest in perpetual swaps and also what the reception might be in the U.S. given that Coinbase and Robin Hood are going to get in the game. So tell us how did Hyperliquid change the conversation when it came to point?

perps. Well, I think anytime that you get Binance founder of CZ, Chang Pengzel, to tweet directly at you, you've gotten someone's attention. And Hyperliquid has really become a rocket ship in the last few months in terms of eating finances market share in the total perps market. At last check, I think they had an all-time high of about 11.7, 11% in change of finances total volume. And, and the, they really did this in a couple of ways. One, they put together what I was told, speaking to multiple sources and people who trade on a platform, a really sleek and easy to use experience for traders so that there's no like operational friction. And as some, this is something I know you've also talked about a lot, Laura. They had a very successful token launch event where

they really did a good job of sort of sharing the wealth with. their users in order to sort of engender just a positive feeling. And then through buybacks and things like that, they've helped to sort of maintain the value of the token. And what's I think really important to note here is that after some of the airdrop, air drop activity has sort of tailed off, activity on hyperliquid is continuing to grow, which is, as you know, in crypto,

kind of a rare thing, given how much air drop farming is sort of a pastime. The fact that they're continuing to maintain and grow volume and market share, after they kind of reached that particular marker speaks to the sustainability of what they built. And so, you know, now we're in this position where we are likely going to see perps finally come to the U.S. What do we know about U.S. interest in Perps? So in the U.S., I mean, the interest is definitely there. And one of the ways that we try to determine this is by looking at hyperlipic website visitors to hyperliquid. We consulted with similar web to sort of pull data.

It was a little tricky because the website we've primarily used was the one for the Hyper Liquid Foundation. And for anyone who doesn't know watching or listening to this, hyperliproids. is more than just a decentralized perpetuals exchange. It's actually an entire L1, and there's a plan to build an entire ecosystem of apps using the decks as a back-in to sort of facilitate liquidity. So there's a whole project there. And usually when people go to the website, that's where they end up on. There's a separate application for the specific trading platform. But again, going back to the main landing page for the foundation, 25% of all users or all visitors came from the United States.

And this is very interesting for a couple of reasons. One, hyperliquid and the hyperliquid platform is banned in the United States. And if someone with a US IP address goes to the platform and tries to connect their well in trade, they will be blocked unless they use a VPN or something like that. Two, all of the other big perp offerings or offers either centralized or decentralized that are similarly banned in the United States have, They do not have nearly the same type of geographic footprint in America as far as website visitors. And I'm talking about Deribit or Bybit or Binance, things like that. So Hyperliquate is really kind of standing out here. That doesn't, again, I'm not trying to say that 25% of Hyperliquids users are Americans.

It's really hard to figure that thing out or figure out that exact number. But it shows that there's a lot of interest in this platform and what they are offering their customers. And so here we are. you know, Coinbase has announced that it's going to be launching perps in the U.S. actually very soon. Robin Hood has not officially announced this, but Arthur Hayes actually said this on Unchained a few weeks ago. So, you know, I can't really speak to the, you know, accuracy of what he's saying there. But, you know, it seems pretty obvious that like this would be something that would be right in their wheelhouse.

So why do you think that Coinbase and Robin are choosing to launch now. So there's a couple of reasons. One, it's hard to ignore the, sort of just the sheer growth of fiber liquid. And in crypto as in traditional finance, typically the derivatives markets, futures, options, et cetera is substantially higher than the spot market.

That's true here now and it's true in the regular world. And it's only going to get, it's only going to get bigger. I think in the. story, we calculated the exact numbers, but I believe, I mean, it's orders of magnitude larger than the spot market, the derivatives market. And for two brands like Coinbase and Robin Hood that have very heavy retail focuses, this fits very nicely into what they're trying to do. Coinbase gets 86% of its revenue, transaction revenue by selling to retail customers. And that's all spot. They don't offer, they don't really offer perpetuals yet. They're going to start on July.

July 21st, I think this was, July 21st, I'm sorry. That was actually just announced today. They do have a futures product. There are crypto features in the United States offered the largest by far is the CME group, the Chicago Mercantile Exchange. But those are usually the reserve for big institutions that have to go through something called an FCM to even access it. That's not really available. Perps are very much a retail focused product because they're easy to use from an operational point if you don't have to worry about rolling over positions at the end of a month if you use a traditional futures you can just make a trade leave it on as long as you want you still have to pay a funding rate which basically means you're paying someone to take the other side of the trade so it's

they're still out there but it's just much easier and the thing that people love in crypto because they speculate so much is leverage that's the big difference that these perpetual futures or offer that the spot market does not you can get somewhere between 10 20 50 100x leverage, which can accelerate or accentuate your gains or your losses. But if people have really strong convictions about where the market's going, perpetual futures let you express that opinion on the market. And so it seems like you're saying that, you know, there is multiple reasons to believe that these will be successful.

You know, what more did you find out about how these launches might go? Yeah, so there's a couple other things that are worth mentioning to. So just following up from my previous answer, again, there's not great ways to get leverage, especially for U.S. customers. Right now, actually, I think we put this in the story. The most interesting way for most people is to buy into these crypto treasury companies that are trading at multiple premiums to NAV for the billions and millions of dollars that they have on their balance sheet in crypto. But as we've talked about before, and I've detailed in previous reports, they come with a lot of rest. And there's certainly no guarantee that the premiums that these companies have achieved as they're launching and making these big nine and ten figure announcements that they're going to be sustainable. It's very possible that Michael Saylor and strategy is kind of the unicorn in this entire field.

And then you don't know how the companies are governed and you don't know if they're going to take unnecessary risks with the crypto on their balance sheet. So there's a lot of unknowns. Perps are cleaner. So there's that. And then second, these treasury companies and even, the features that are offered by the likes of CME group, they really only focus on the biggest assets that there are, Bitcoin, Ethereum, so on, maybe XRP, combine those amount for, I don't know, somewhere 95% of the total crypto market cap may be even higher.

If people want to express views on longer tail assets that are less well-known, less liquid, and if they really want to do it with leverage, which again, may or may not be a good idea, perps are a really great way of doing that because of the way that they're constructed and and just some of the ways that the operators, both in the centralized and decentralized flavors, are able to kind of offer liquidity in order to service that type of customer demand. So perps in particular are a great way for customers to express views on longer tail assets with leverage that they would not be able to in the spot market.

So for all those different reasons, like this is a product that I would imagine customers are going to, want, especially if, especially if alt season really kind of returns. So I know we were talking a little earlier today. Bitcoin, I believe, is the highest. Bitcoin's market cap dominance is the highest that it's been, frankly, in years since I believe in 2021 almost. It's around 65%. That means that Bitcoin is gaining on the rest of the market for the most part.

But certainly, there's always the possibility that that would switch. And if that happens, then I would expect. these types of products which will be launching in the next couple of months to really take off. Do you see any hurdles that the perps in the U.S. will have to overcome? There's a couple, and we pointed out two in the article. For one, it's going to be interesting to see how these products do when the customers are not going to be incentivized with tokens like Hyperliquids customers are. A big reason for their surge is, again, the fair launch of the hype token, which has performed well since its launch.

And it's really sort of built that sense of community. Now, Robin Hood and Coinbase, they have very strong retail brands. But they haven't like shared the wealth. They're not sharing shares of stock. They don't have tokens that necessarily might bind customers to them if they find a place with, better performance, a better deal, something like that. And then speaking about performance, it's also important to note that once perpetuals are launched in the United States, that doesn't mean it's going to be exact the same type of product that you get at hyperliquid.

Perpetuals are regulated by the CFDC, the Commodd Futures Trading Commission, and there's going to be restrictions from a risk management point of view on the amount of leverage that's going to be offered. You're probably not going to get 50 to 1. Maybe you'll get 5 to 1 or 10 to 1. And there's also going to be restrictions on the type of collateral that somebody can post in order to take out that leverage. On hyperliquid, you can post Bitcoin. You can post other things. Whereas here in the U.S., you might have to post the cash or maybe USDC or regulated stable coin. But you're probably not going to be able to post Salana as collateral and take out margin to put on a perps bet on Bitcoin or Salina or something like this too.

And that's what people want. This is sort of like a hidden part of finance. But and one of the big benefits of like Wall Street banks, for instance, is that you can, you have a diverse portfolio, but you can post lots of different things as collateral in order to express views on the market. And as these products are launching right away, you're probably not going to see that. So it's not going to quite be an apples to apples comparison. Yeah, this is why Arthur was saying on the show that, you know, he was a fan of hype,

but he was just wondering how the token went to once the U.S. products launched simply because He did not know what size the overlap was between, you know, U.S. users and hyperliquid users. And, you know, as you mentioned, the website traffic, it gives some kind of hint, but we're not sure, you know, what exactly it says or how much of an influence that shows. So I love to see what happens. All right. Well, thanks so much for sharing your insights with us. Great. Thanks, Laura.

Don't forget. Next up is the weekly news recap. Stick around for this week in crypto after this short break. Wish you could access cash without selling your Bitcoin? Lennon makes that possible. The global leader in Bitcoin-backed lending, Leden has issued over $9 billion in loans since 2018, and never lost a single Satoshi of client assets.

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as Polymarket and Kalshi draw hundreds of millions in fresh funding. Coinbase announces perps in the U.S. FISERB unveils a stable coin initiative for community banks and Trump media's crypto ETF inches closer to listing. Celestia considers a radical shift away from staking, while Ethereum I's faster blocks and a ZKVM breakthrough. OKX explores a US IPO. FTX pushes back on a $1.5 billion claim from

Three Arrow's Capital, and Reddit looks to Iris scanning tech to verify humanity online. Plus, Tether demands a board seat at Juventus. Let's begin. Prediction Markets go mainstream. The prediction market space is gaining momentum as both Polly Market and Kalshi secure major new funding rounds, signaling rising institutional interest in event-based crypto trading. Polymarket is close to raising over $200 million in a round led by Peter Thiel's Founders Fund, which would value the platform at approximately $1 billion, as first reported by the information.

The platform, known for allowing users to bet with cryptocurrency on outcomes, such as elections and economic data, recorded $2.6 billion in trading volume in November 2024. Despite being banned for U.S. users since 2022, due to regulatory restrictions, Polly Market has expanded globally and recently partnered with Elon Musk's X to serve as its official prediction market provider. Meanwhile, Kalshi has raised $185 million in a round led by Crypto Venture Firm Paradigm, bringing its post-money valuation to $2 billion. Kalshi offers a regulated alternative and operates with approval from the U.S. Commodity Futures Trading Commission, making it accessible to American users.

The firm allows trading on topics ranging from political races to financial indicators. Coinbase to launch perpetual-style futures in America. Coinbase will debut its first U.S. regulated perpetual-style futures products on July 21st, offering Bitcoin and Ether contracts designed to mirror global perpetual futures while complying with CFTC regulations. The contracts will feature five-year expirations, hourly funding accruals, and 24-7 trading, aiming to provide spotlight exposure with leverage. The launch is intended to give U.S. traders a domestic, regulated alternative to offshore

platforms, which have traditionally dominated this market segment. The move comes as perpetual futures continue to outpace spot trading volumes, with $10.17 trillion traded globally in the first half of 2025. There's strong U.S. interest in these products. As noted in an unchained analysis this week, platforms like Hyperliquid, despite being geo-blocked, attract substantial American web traffic. Coinbase's offering could capture that demand, but challenges remain. including the lack of incentive tokens and limitations on leverage compared to unregulated venues.

FISERV rolls out Stablecoin initiative on Solana. FISAV is launching a new stablecoin initiative aimed at helping regional and community banks participate in the fast-growing digital asset market. The financial technology company, which services over 3,000 smaller banks and touches trillions in transaction volume annually, plans to debut a stablecoin called FI-USD, alongside a broader platform by year's end. Partnering with Solana and Stablecoin issuers Circle and Paxos, FISA will also integrate fraud and settlement controls,

with custody responsibilities falling to larger financial institutions. The platform is designed to be interoperable with other stable coins, allowing for broad connectivity across over 10,000 financial institutions and millions of merchants. The announcement arrives as Solana's ecosystem gains traction. Defi DevCorp launched a validator node for the Dogwafat token and Treasury firm Upexe now holds over 679,000 Saul after a major stock sale, though its shares plunged nearly 60% following the move. NYSE advances listing effort for Trump Media's crypto-etf. The New York Stock Exchange has filed for a rule change that would allow it to list the truth, Social Bitcoin, and Ethereum ETF, a dual crypto fund proposed by Trump Media and Technology Group. The ETIF would hold Bitcoin and Ether in a 75 to 25% split, with Crypto.com serving as both custodian and liquidity provider.

The filing was made under the SEC's 19B-4 process, a required step for potential approval, but not a guarantee of listing. The move comes shortly after Trump media announced plans to raise $2.4 billion to develop a Bitcoin Treasury. While the firm has proposed a broader slate of politically themed crypto products, only the Trump, truth-branded ETFs have been formally submitted to regulators. Celestia considers ditching staking. Celestia co-founder John Adler has proposed replacing the network's proof-of-stake model with a new proof-of-governance system amid a 93% drop in the value of its native TIA token. The plan would eliminate staking rewards and slash annual token issuance from 8% to just 0.25%, aiming to reduce

inflation and shift value accrual toward actual usage of Celestia's data availability services. Under the proposed model, token holders would elect network operators directly without locking up tokens, while rewards would be limited to infrastructure providers. Adler argues this would create a fairer and more efficient structure without slashing penalties. Research firm Kairos responded positively, calling the proposal pragmatic, and noting that validator commissions vastly outweigh network revenue. Their analysis showed Celestia paid over $120 million in validator rewards since early 2024, while actual revenue totaled just $1.3 million.

The firm backed off-chain governance if transparency is maintained. Ethereum Eyes, Faster Blocks, and ZKVM Breakthrough. Ethereum developers are considering a protocol change that could double the network's block production rate. EIP 7782 proposed by core developer Barnaby Mono, would reduce Ethereum's slot time from 12 seconds to 6 seconds, enabling faster transaction confirmations and more responsive daps. Shorter slot times make Ethereum a better confirmation engine,

Minot wrote, highlighting benefits for apps and roll-ups that rely on timely updates from Ethereum layer 1. The proposal may be included in Ethereum's next major upgrade, Glamsterdam, slated for 2026. Meanwhile, Matter Labs has introduced a new zero-knowledge virtual machine called AirBender, capable of proving Ethereum blocks in under 35 seconds on a single GPU. The open source ZKV based on the Risk 5 architecture marks a significant leap in decentralized proving, which traditionally requires dozens of GPUs. OkX weighs USIPO.

Crypto Exchange OkX is exploring a potential initial public offering in the United States, signaling a broader shift among digital asset firms toward public equity markets, the information first reported. We will absolutely consider an IPO in the future, said chief marketing officer, Hider Rafique, noting that the U.S. would likely be the destination if the company proceeds. The consideration follows OKX's re-entry into the U.S. market in April, after paying a $500 million settlement for operating without proper licensure. Now ranked as the fifth largest exchange globally by trading volume, OKX, is reportedly,

evaluating market conditions before initiating formal plans. The move comes as other crypto companies, including Circle, have successfully launched public offerings. FTX challenges three arrows capitals $1.5 billion claim. FTX is seeking to block a $1.53 billion claim filed by collapsed hedge fund three arrows capital, arguing the figure is based on inflated account balances and flawed assumptions. In a filing submitted to the U.S. bankruptcy court in Delaware, FTX's legal team called the claim, illogical and baseless, stating 3A is attempting to recoup losses from a failed trading strategy at the expense of other creditors. According to FTX, 3AC's true account value stood at just

$284 million in June 2022. Much of it borrowed. FTX says the only liquidation that occurred involved $82 million in crypto and was contractually permitted under margin agreements, that liquidation, FTX contends, actually preserved value by converting volatile assets to fiat. 3AC has until July 11th to respond, with a hearing scheduled for August 12th. Reddit weighs IRIS scanning tech to distinguish humans from bots. Reddit is reportedly in discussions to integrate World ID, a digital identity protocol developed by tools for humanity, to help users verify their humanity without compromising anonymity.

The system uses a biometric device known as the orb to scan a user's iris, creating an encrypted ID stored locally on their device. No personal data is retained, and the verification proves that each user is a unique individual. The move comes amid rising concerns about AI-generated content and growing regulatory pressure for age verification. We will do our best to present. reserve both the humanness and anonymity of Reddit, CEO Steve Huffman wrote last month. If adopted, World ID would allow Reddit users to remain pseudonymous while signaling authenticity.

Verification could also help the platform comply with emerging laws without directly collecting sensitive user data. Tether pushes for a Uventus board seat. Tether is pressing for a seat on Uventus Football Club's board, escalating tensions with the team's and majority owner Exor, according to a Bloomberg report. Despite holding a 10.7% stake valued at approximately 128 million euros, Tether says its efforts to engage with club leadership have been met with silence. Communication has been very, very limited, CEO Paulo Arduino said.

Tether first disclosed its stake in February, becoming the second largest shareholder in the storied club. The crypto firm now seeks a more active. role in guiding Juventus, citing its commitment to the team's long-term success. We believe having a voice in key decisions is part of fulfilling that responsibility, the company said. Juventus has indicated it may meet with Tether after the club World Cup ends in July. Until then, Exor is withholding judgment on any expanded involvement from the crypto investor.

Time for fun, bits! Bartcoin could someday help you buy a house. Start prepping your wallet, and not the leather comment. mind. The Federal Housing Finance Agency has directed Fannie Mae and Freddie Mac to explore letting cryptocurrency count toward your mortgage application. Yes, one day your collection of Dogecoin, Pepe, or even Fartcoin might actually help you land that starter home. This is not an overnight change. The directive asks the mortgage giants to submit formal proposals on how they would treat crypto held on U.S. regulated centralized exchanges without requiring borrowers

to cash out first. They also need to figure out how to do. to deal with crypto's habit of swinging wildly in price. FHFA director William Palt said the move aligns with President Trump's vision to make the United States the crypto capital of the world. So while you cannot use your shit coin to close on a condo just yet, the path to blockchain-backed home buying is officially under construction. And that's all. Thanks so much for joining us today. If you enjoyed this recap, go to unchainedcrypto.bhive.com. That is unchainedcrypto.bhive.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 Matt Pilchard,

Juan Oranovich, Margaret Curia, and Pam Majumdar. The weekly recap was written by Juan Aranovich and edited by Stephen Erlich. Thanks for listening.