Unchained - The Chopping Block: Corpo Chains, Monero’s AI Vampire Attack, and DAT Mania - Ep. 887

Episode Date: August 14, 2025

Altcoin season meets corporate blockchains as Circle and Stripe launch their own L1s, Monero suffers the biggest 51% attack in history (powered by an AI named “Garth”), and the crew debates whether the DAT boom is heading toward equilibrium or mania. Welcome to The Chopping Block – where crypto insiders Haseeb Qureshi, Tom Schmidt, Tarun Chitra, and Robert Leshner chop it up about the latest in crypto. In this episode, the crew dives into the surprising altcoin rally and asks whether ETH still counts as an alt. The big news: Circle unveils Arc, Stripe leaks Tempo — and crypto Twitter is not impressed. We explore why major fintechs are launching their own chains instead of using Ethereum L2s, and whether stablecoin-centric blockchains are the future or just profit grabs. Then: the wildest headline of the week — Monero gets hit with a 51% attack by Qubic, a project training an AI called “Garth,” in what might be the largest attack of its kind. We break down the game theory, the proof-of-work vs. proof-of-stake debate, and what this foreshadows for Bitcoin’s security decades from now. Also: Trump’s executive order opens the door for crypto in 401(k) plans, we speculate about a future GPU debt market crisis, and dissect the state of play in Digital Asset Treasuries (DATs) — including whether yield advantages over staking ETFs mean we’re only halfway to mania. Show highlights 🔹 ETH vs. Alts – Is Ethereum still an altcoin, or has it graduated to “major” status? 🔹 Circle’s Arc & Stripe’s Tempo – Why are fintech giants launching their own L1s instead of using Ethereum L2s? 🔹 Crypto Twitter Backlash – The ethos clash between “public goods” culture and corporate profit motives. 🔹 Monero’s 51% Attack – Qubic’s AI Garth mines enough hash power to take over Monero as a “proof of concept.” 🔹 Game Theory & Chain Security – Why PoW is fun (and dangerous) to reason about, and how PoS differs. 🔹 Bitcoin’s Future Risk – How tail emissions (or lack thereof) could leave BTC open to similar attacks. 🔹 401(k) Goes Crypto – Trump’s executive order allows digital assets in retirement accounts. 🔹 GPU Debt Crisis Fanfic – Tarun’s prediction for a future financial meltdown. 🔹 DATs Debate – Are Digital Asset Treasuries sustainable, or primed for a spectacular unwind? 🔹 Yield Edge over ETFs – Why DATs may outperform staking ETFs in capturing on-chain yield. ⭐️Haseeb Qureshi, Managing Partner at Dragonfly ⭐️Robert Leshner, CEO & Co-founder of Superstate ⭐️Tarun Chitra, Managing Partner at Robot Ventures ⭐️Tom Schmidt, General Partner at Dragonfly  Democratizing Access To Alternative Assets For 401(K) Investors  https://www.whitehouse.gov/presidential-actions/2025/08/democratizing-access-to-alternative-assets-for-401k-investors/  Timestamps 00:00 Intro 01:01 Crypto Market Sentiments 02:29 Circle’s Arc & Stripe's Tempo 07:34 Corporate Chains vs. L2 Solutions 17:57 Monero's 51% Attack by Qubic 27:11  Real-World & Protocol Incentives 29:33 Monero's Tail Emission & Bitcoin's Future 34:39 Trump’s Executive Order: Crypto in 401(k)s 37:15 Next Financial Crisis? GPU Debt Crisis 41:15 DAT Mania Potential & mNAV Compression Learn more about your ad choices. Visit megaphone.fm/adchoices

There's a strong libertarian hyper-capitalist impulse behind crypto, which should be cheering on companies doing whatever the fuck they want. Like, this is a permissionless technology. And permissionlessness means you can just do what you want. You can just try a thing and like see if it works. Not a dividend. It's a tale of two quons. Now, your losses are on someone else's balance. Generally speaking, air drops are kind of pointless anyways.

Unnamed trading firms who are very involved. I like that eat is the ultimate pump. D5 protocols are the antidote to this problem. Hello, everyone. Welcome to the Chhabin Block. Every couple weeks, the four of us get together and give the industry insider's perspective on the crypto topics of the day. So quick intro, is first you got Tom, the DFi Maven and Master of Memes. Hello, everyone. Next we got Robert, the Crypto connoisseur, and Tsar of Super State. Aloha. Next we got Tarun, the Gigabrain, and Gran Puba at Gondland. And finally, I'm the Seve, the head hype man at Dryden Fly. We're early-stage investors in crypto, but I want to caveat that nothing we say here is investment advice, legal advice, or even life advice. Please see Chalblogne, for more disclosures. So Eith just hit all-time high. I think we are officially in an all-coin market now. Boys, how are you feeling? Exhausted. What about you? Exhausted. Why are you exhausted? Wait, is that not, are you not elated? Are you not

bullion? Like, is there not another adjective you would describe yourself as? I like elated, I guess. I think everyone is, you know, in the midst of any high velocity, lots of coins are moving. a lot of things are happening. The news cycles are getting intense. I think a lot of people get exhausted. So I'm elated and exhausted. There's just so much happening in so many directions. I can't stay on top of it.

Is ETH still an altcoin? Or are you generally speaking, the markets are moving. I feel like ETH has graduated by this point to not. I feel like if you don't have an ETF, you're an alt coin. But if you do, yeah, you're good to go. You're a major. You're a major. I always think of Bitcoin and the alts.

Yeah, I think of Bitcoin and the alts in like majors. is like a separate, it's like a different way of dividing up things. Bitcoin and Alt sounds like a 1950s like doo-op band, you know? Next up, we got Bitcoin and the alt. Ether. Bitcoin. Oh, Robert, keep going. Keep going.

That was good. Do-up, do-up. Bitcoin. Do-up, do-up. Ether and altz. Okay, very good. All right. So with that as the intro, let's get into the stories of this week.

So first we've got Maybe in response to All season, we've got some new chains that are launching, except these chains have a twist. These chains are all being launched by gigantic fintech companies. So first we've got Circle. We've got these corpo chains, as they're sometimes being called now.

So the first corpo chain is Circle. Is this just Enterprise Blockchain, but Silicon Valley Edition? No, no, no, no, no. It's definitely not an enterprise blockchain. Yeah, this is a new generation. This is a new generation. Because these are open source. Corrective. These are open source. These are permissionless. Now, you cannot validate these

permissionlessly. So Circle's arc chain is going to be focused on stable coins and FX payments, targeting a public test net sometime, probably in a few months. It's a proof of authority chain, built by Molokite, which is a team that I guess Circle acquired, supposedly has 3,000 TPS with 20 validators-ish from like 350 milliseconds finality, so a very fast chain. There are going to be confidential transfers that hide amounts, but not the addresses. And you'll have a view key, so you can disclose selectively to different people. What is the amount of money that you're moving? The gas token is going to be USDC.

There will also be USYC, which is PashNote. That's like a treasury-backed coin that you can use to get some interest. And it's going to have a built-in FX engine for approved institutions to be able to settle currency trades atomically using some off-chain RFQ pricing that they have to set up. So it's basically stablecoin FX chain built by circle. and anyone can use it, and presumably there's going to be smart contracts and all sorts of other magic

that people are going to deploy there. So I've been hearing some rumblings about this. Now it's finally the big announcement was today, but they've already started engaging some teams who are going to be building an initial set of applications that are going to go live on ARC in the early days. So that's ARC. There's a second chain that I think is also part of this conversation,

which is Stripe, is building their own L1 called Tempo. Now, we don't have as much details on tempo. Apparently, it was first leaked through a job posting that was reported on, I think, by, I can't remember who. Okay. Can we say that the timing is a little suss? It was like leaked. I mean, people have been talking about on Twitter for a while, but the Fortune article was like yesterday. And then today was the Circle earnings where they announced. Do you think that Circle was planned for a long time

and then the Stripe one was leaked in the day before to change the narrative? Do you think I mean, I think circle on their first earnings call needed like a big thing, right? Like, and if there's ever a good time to announce, it's then. But the thing is, that's publicly known. Like, you know exactly when the announcement is for a while. So I feel like the timing was a little suss. That was the first thing I thought. Yeah.

I mean, for for Stripe, though, like, there have been murmurings about this for over a month. A long time. That paradigm was working on L1 on behalf of Stripe. And so this was more or less publicly known. I mean, there were just a lot of these Twitter in-ons talking about it. Yeah, yeah, there were Annons talking about there weren't like Fortune articles. The Fortune article which cited the job posting that was like the day before the circle thing. That was like the thing.

Yeah, but they deleted the job posting. So clearly they were not trying to like that. Isn't that exactly what you do? You make the job posting. No. That's 40. You mess with the journalist. You're like, look at this job posting and you delete it.

Oh, I think it's true. You're not lucky valiant enough to see. No, no, no. If you wanted to announce it, you would come up with something bigger and, like, make it a story. Right now, it's mostly just hate. People are not happy about these corpo chains. But we'll get into that. So just very quickly on tempo, a few details here on tempo.

So first, it's not a fork of an existing chain. It's going to be built from the ground up by paradigm, which is kind of weird. Now, Paradigm, notably, Matt Wong is on the board of Stripe. I think he invested previously when he was at Sequoia before he went into Paradigm. And apparently it was just reported by fortune that Matt Huang is the CEO. of tempo, which is interesting. I don't know what exactly that means. Nobody really responded to what exactly that entails.

But I would assume that it means that he's like interim CEO before they find an actual CEO. That's what I would assume that means because there's no way that he's doing, like day-to-day actually running this thing. But technically, according to Fortune, Matt Huang is CEO, despite the fact that he's also running a gigantic firm, which is paradigm. So we've got Stripe launching an L1. we've got Circle launching in L1. We also have Robin Hood launching in L2, which was reported relatively recently, and there's murmurings about other large fintechs,

you know, contemplating their own chains. So most of the response that I've seen on Twitter has been overwhelmingly negative. Of course, the shareholders of Circle seemed to like it because, you know, Circle went up. Circle stock went up on the announcement of this. Yeah, I was going to say, on the back of this, they started initially shares.

Yeah, yeah. Sure, sure. Coinbase sold a bunch of shares. into that's money offering, actually. That was like why I think I noticed. It showed up on Bluebird. Right, but the stock went up, right? Yeah, yeah, yeah.

I'm just pointing out that they had good timing also on the offering. Yeah, yeah. Executed well, no doubt. But there's a disconnect here where the crypto community or the crypto diehards or let's just say crypto Twitter, very negative against these. The response that I've seen, the modal response to crypto Twitter is, why are there more L1s, you know, like why don't you just? like building an L2 or using something that already exists.

Okay, great, more dead chains. Didn't you learn a lesson from Libra? And I saw even Christian Catalini, who's now at, what is it, Lightning Labs? Or what's the name of the? Sorry, Lights Park. Yeah, Lights Park. Christian Catalini, who was previously on Libra, even he was dunking on these, despite the fact that Libra was like the original Corpo chain.

And he was like, you know, back at Libra, we had to invent new things because the chains genuinely couldn't scale. Now they can. Like, why are we still doing it? like why are we still doing this? Wait, wait, wait. Someone making a lightning network thing is saying that is also another irony. Well, so thoughts from the panel, what do you guys think?

Corpo chains is a corporal chain season? Is this good? Is this bad? How do we feel about this? Well, it's absolutely corpo chain season, right? When you get it from circle, when you get it from stripe. I mean, the original, what's the original base at this point? Corpo chains are here to stay.

I feel like. But base was an L2. And I think the response to L2. L2 has been very positive. Yeah. Are we differentiating L2 versus L1 as corporate chain? Yeah. The response very much is.

People were cheering Robin Hood. They are not cheering Ark or, or tempo. But I would say that Robin Hood will accrete roughly the same amount of value back to Arbitrum or Ethereum as a standalone L1 will. I think like either way, it's relatively instructive. So you're the person who believes that L2B should be renamed Bridgebeat because all L2s are really bridges, huh? You want to wait back into that discussion if you remember that? That's a different episode, different episode. But I don't think there's functionally much of a difference between whether you're launching something that's now two or launching something

that's now one. Either way, it's a corporation saying we have distribution, we have users, we have product, we have a reason to exist, and if we launch a chain, we can get a bunch of activity there and win this nebulous concept of market share on our chain. And I don't think it matters how it's built. I don't think it matters where it is. I think the distribution hook is like the entire difference maker between any of these extremely competitive corpo chains. I think the response from many people is that, well, this is what L2s were made for. We kind of finally built this stack that's easily replicable, that's extremely horizontally scalable. We have a cajillion of these. We have an entire supply chain. You don't have to build anything

yourself. You can just kind of, you know, spin up a new L2. pretty quickly, and you get Ethereum security, supposedly, from doing one of these L2s. And yet, it seems like the corporations have not gotten the message, and they're reinventing the wheel, and they're fragmented in the ecosystem even more. And so I think that's a lot of the frustration. I mean, I was posting about this this morning, and I got a bunch of people arguing me in my comments, basically trotting out this argument, is that I think mostly Ethereum-aligned people who say, like, why are you reinventing the wheel?

and this is what else is made for. This is lame. I'm like, you, I feel like you, I mean, I have perspectives on, on the merits of having a corpo chain, but I'm like, ultimately, you should then be taking this as a lesson that, like, your chain is not solving the problem that they have or your strategy is not appealing or, like, you should be like, great, you know, we're going to win in the marketplace regardless. Like, I feel like this is almost like a reversion for the East community of kind of finger wagging and and then like kind of all the bullshit that I feel like we've been going for the past few years that we're finally breaking out of.

And now it's like more moralizing, oh, like, Stripe should be paying us for, you know, data availability. Like, no, like, that's what the fuck are you talking about? Like, like, Stripe has clear business needs and this is the decision that they've made. I don't think they're thinking about pumping a token or some shit. I think they're just thinking about what is actually going to solve our problem. And so I think the L2L1 kind of misses the point, which is like, what is actually missing in the kind of current roadmap that like is causing these, these companies to go and do their own chain. I do think the track record video of these things has been pretty poor. Maybe things are different this time.

But I always kind of think of like figure as being kind of like the poster child for this where it's like, okay, technically it's like on a blockchain. But if it doesn't have the properties that actually make a blockchain attractive, which is like it's permissionless and transparent and like people can build out of than like what like why did you build this in the first place? You could have just used a database. And I don't know. I mean, circles thing sounds kind of interesting.

I don't know what the plan is for tempo. but I think a lot of these things in my mind will end up reverting back to we're just using this as basically like a internal ledger for moving stuff around because they don't want to welcome all the hair of like actually having a permissionless dev ecosystem. Okay. So now we have a bunch of, I guess what you guys are calling corporate chains. I just think of them as stable coin chains. Well, they're not just stable coin chains. I mean, like, yeah, that's the primary use case for all of these things. No, no, no, no, no.

But all of them are tied to some stable coins. like plasma, stable, what's the one you guys invested in? Codex, Codex, is that right? They all kind of have this flavor of like stable coin is like the central object, not volatile token, which is like, that's kind of what I views a defining feature of this crop of them versus like classic L1s. There's a white paper for compound chain going back to 2020, which by the way might have been the first, but there's a stable coin as the center object of it with everything built around it. But that's a digression. Yeah, I just mean that maybe I shouldn't say this is why I guess the semantic thing is like already tiring. It's I just, the point is that there are these kind of like stable coin based ecosystems versus like volatile coin based ecosystems.

That's like to me that's the main difference more than the like L1, L2 classification. But now that there's so many all launching at the same time. It does feel a little like we went from like one Libra didn't work. So let's try to DDoS the government with 10 Libros. You know what I mean? I don't know. Obviously, it's a different world than at that time. I just kind of...

Well, to build on to that, actually, I think that is interesting to Vrune. And this goes back to why do people dislike certain ones and love other ones? When the native asset is ether, all the ether people are like, hooray, you did it. And when the native asset is a company stable coin, everyone's like, boo, it's extractive, it's your profit center. And I guess that is the difference in that what is the native asset is a pretty clear way. I think that's what people are fighting about. They just don't want to say it because, like, they wanted to be like, ether's the same. stable coin chain. So you can't have stable coin. You know what I mean? There's like a little bit of that.

Or make ether the native token of your stable coin chain. Yeah. Well, it comes back, I think, to the age old philosophical conflict at the center of crypto between socialism and capitalism, which is like there's a, there's a strong libertarian hypercapitalist impulse behind crypto, which is, which should be cheering on companies doing whatever the fuck they want. Like, this is a permissionless technology. And permissionlessness means you can just do what you want. You can just try a thing and, like, see if it works. And then at the same time, there is a strong sense of, like, oh, you shouldn't be extracting. You should be giving back to the commons.

You should be thinking about public goods. You should be doing quadratic voting or, you know, whatever. And like all of these, this impulse of like, hey, what about the airdrop? Like, it sounds like you guys are just going to extract all this for yourself. That set of norms is like the set of norms that's being implicitly violated. People won't quite describe it that way because I don't think they're self-aware enough. But I think that's a large part of where this is coming from. And when real companies get into the space, they're not doing any of that.

They're not going to do that second part of what we do in the crypto scene. Right. Well, Cypherpunk feels like it's of the people. And, you know, these corporal chains feel like they're by the man. And I think that's the difference. Even though they're both built on like this libertarian, like build a, you know, permissionless thing. I think they come out from such different angles that I feel like the original sort of believers

don't feel like it's within the ethos, even if it's libertarian. in its nature if anyone can build anything. Yeah. I fundamentally support any company doing whatever the hell they want. And at the end of the day, if they figure something out and bring more people on chain using wallets in permissionless ecosystems where there are smart contracts and anybody can build anything, I think that's awesome. I basically don't really care whether it's an L1 or an L2 or whatever.

They can call an L5 for all I care. So I think the, like I remember when CBDCs were the talk of the town and the central criticism of CBDCs is that they're not really blockchains, like they don't have blocks, they don't have chains, they don't have addresses, they're not permissionless, they don't have smart contracts. These do, these have all of those, right? So like whatever you can call these things,

these are definitely blockchains, they're definitely increasing the total GDP of what's happening on chain, and they're a complete phase shift from how these businesses have operated before. I think those are all great things and should all be applauded and welcomed by the industry, complaining that like, oh, they're not using

my toy, I want them to use my toy instead of their toy. I agree with Tom. I think it's like very short-sighted and kind of petty. So I mean, I also think Twitter is just such an anti-signal. Like, like, it misses all the like trends, you know, like I kind of feel like Twitter's for old people now. There's somewhere else that things are happening. And I, I don't know where it is. Where are they happening? Where are they happening? All I know is like, I don't see anyone who's like loves pumped. Exactly. Like, if I go, if I want to find the. Zora, if I look at the Zora price, it's correlated with usage of Harcaster. It's not really correlated at all. Twitter people are like barely, we're barely noticing it or pumped out fun stuff.

I don't know where that happens. It's clearly not CT. So there's like so many trends that just like completely are wrong, like Twitter gets wrong that I found it to be a signal that's like decayed to like a coin flip almost. It's like a very noisy coin flip. Do young people still call it Twitter or is that just like an old people thing? Probably. Tommy. What do you call it? Tom.

What do you call it? The youngest of this crew. I still call it Twitter. I can't do X. I just can't. I'm sorry. Yeah. Yeah, don't do X.

Never do X. Listen to your elders. Don't do X. Okay. So switching gears, Rob, you were just complaining about, you know,

the death of the cyphopunk movement. Well, we have a very cyphor punk story that just took place. It's kind of still going on, I suppose, which is that Manero just experienced a 51% attack, which seems to be ostensibly the biggest 51% attack in history.

So for those of you who are new to crypto or came in post, I guess, like, 2021, yeah, we've been talked about this in like six years. Totally alien to you. You know, you think of the world of proof of stake where, like, you know, proof of work is like this old antiquated thing that only Bitcoiners care about. But there are proof of work coins out there. And one of the features of proof of work is that you can take over a proof of work chain by doing what's called a 51% attack. A 51% attack is when you control more than 51% of the total hash rate or total hash power that is mining a coin.

Okay. So now this is a, let's say, a very 2025 kind of 51% attack because normally the old school 51% attack is you know, you go spend a bunch of money, you short a token maybe, and then you go use your hash rate to try to. mine it into the ground and maybe you mine it such that no transaction is getting included or something like that. But that's not what happened here. What happened here is there's a token project called Cubic. Okay, Cubic with a Q. Now, Kubik is trying to build an AI model called, let's see what it's called. It's called AI Garth. Okay. So here's my rough understanding. There's a very garbled understanding, but this is my rough understanding how it works. So Kubic enlisted a bunch of validators whose job is to train AI Garth. And so it uses its token to basically enlist all these validators to get them

to mine AI Garth by doing some training on it. Okay. And so they realize it's like, hey, you know, it's kind of expensive to train this thing. Maybe we can find some other source of revenue with all these validators we brought on board. So one thing we could do is use these validators to mine something using their GPUs. Now most networks, even that are proof of work, you can't really mine them profitably with GPUs. You need A6, which are these customized hardware. But, But there are some things you can mine with the GPU. One of them is Monero. So Monero has a hash function called RandomX, which is designed to be unasicable.

But you can use GPUs in order to mine RandomX. So they started mining Monero. Manero is the largest privacy preserving protocol that, or privacy preserving token, coin that exists today. It's actually banned in a lot of exchanges. So many countries, you can't buy Minero on an exchange. But it's pretty large. It's like worth, I don't know, a billion a half.

a couple billion, something like that. Very, very OG, you know, I think like 2012, 2013 era coin. So they decided, hey, we should start mining some Monero. And they were like, oh, actually, we're totally mining a lot of Monero. We're actually doing really great in Monero mining. Maybe we should start using some of the cubic rewards to incentivize people to join our Minero mining pool. And by doing that, because Minero, I guess, not a very competitive mining space,

they quickly started subsidizing their own mining pool to the point where they accumulated 51% hash power. And then, I guess as a PR stunt, Kubik decided, let's do a 51% attack. Now that we have 51%, they started orphaning blocks and basically doing what's called

selfish mining, which is a very advanced maneuver that allows you to actually take over a 51% attack without actually 51%. You just need more than 33%. They eventually got 51% and did a proper 51%

attack against the protocol. This caused a lot of people to freak out. Manaro went down about 15, 20% as a result of this attack. And then, as of about an hour ago before we started taping this, they stopped. And they stated, this was a proof of concept that we could do this to Monero. Unfortunately, Minero was sort of going down a lot and they were like, well, we don't want

to hurt the Minero price because actually it's kind of good for us to mine Minero. And that's actually very profitable for us in our whole business plan. But this is proof of the power of Cubic and the power presumably someday of AI Garth when AI Garth rises out of its GPUs and takes over the world. So we don't own any cubic. This is not a cubic advertisement. But this is the story of what happened with Manero and the 51% attack. Bizarar story.

I don't really know what to think of this other than that. Like, yeah, probably we're well at the point where these proof of work tokens that are smaller than Bitcoin probably are not fundamentally secure. But then maybe they are because Cubic stopped and they mostly just took it as a publicity stunt. Thoughts on Cubic, AI Garth, Monero? You know, I feel like I got into crypto because I love thinking about all. the game theory of like when you should actually do a selfish mining attack and like what the optimal strategy was and there's like a million paper actually I think one of my first papers I wrote was

this one of this kind of related topic but in general I think the fact that you have to reason about this is actually one of the reasons proof of work is like like I think proof of work in a lot of ways is better than proof of stake but this is the most obvious way in which proof of stake is just much easier to reason about the security model like a million times easier so and proof of work does feel like it has the thing, which is like winner take all to your point, which is like the largest coin will aggregate so much more of the electricity that like the economies of scale just go away for everyone else. Whereas in proof of stake, that's not really true because it's so reflexive on the stake to asset price. But I think it's actually kind of cool that this like third

party asset was needed to aggregate. I think in like Bitcoin selfish mining attacks, there are like the attempts, like people, maybe people are, the miners are too religious to take token incentives or something. But in Monaro, clear, that's not the case. Well, what's also interesting, so Cubic is a $300 million token. And Monero, I misquoted, it was actually worth $6 billion at the time that they attacked it. And so it almost feels a little bit like, what was the thing that was taking over curve? Convex. Convax. Convax. I mean, that was a friendly. Curve-made contracts. Okay, what was it?

What was the other one? There was, like, butterfly or something like that. I can't remember the name of it, but there was something that was like taking over convex. It was like two layers deep. You guys know what I'm talking about? The steak-dow. I bet convex-related. I forget, with the butterfly.

This, like, kind of parasitic thing where it's like, you know, this is, this is just like an interesting phenomenon that you can have this, like, these tiny little parasite that, like, takes over a host's brain and starts controlling it. These guys could have just been like, yeah, we control Manera now, like, bow down to us. I think this is a really good use case of dead meme coin capital. You know, like... Do you think so? Because, like, what is cubic?

Realistically, it's like not that different. Yeah, exactly. Use the meme coin. Once the meme coin gets in up market. Hey, you don't know it's dead until AI Garth comes out and fucking comes after you in your sleep. I mean, AIGAR doesn't rely on cubic, realistically. You only needed cubic to bootstrap to pay for AIGARth. AIGRth is a great name.

Is it supposed to be a show garth, like illusion or like, why, why is it AI Garth? I think Garth Brooks. So that's what I say, you want to hear AI Garth. I imagine it just being like very. Yeah, I thought it was like a Wayne's world thing. I don't know. We'll have to do some more research on this topic. All right.

We're going to have to revisit AI Garth and understand the etymology here. But yeah, in some ways, it is like the original vampire attack, right? It's like this extra protocol incentive. The protocol can't really see or reason about. But it's like, hey, as long as Kupik is dishing out these rewards, why not? And I don't know. I mean, really, what is the answer for the community is like to do some sort of aggressive, like, hard fork that like, I don't know.

It's in some ways easier to defend yourself if you're like an actual smart contract protocol versus, you know, being a chain where it's just like, you know, purely almost kind of social consensus driven. Well, yeah, because you have to change your inflation curve to work the attack versus the contract. Yeah, I mean, everything in crypto is about economic incentives, right? Economic incentives create all mining, therefore all security. They create validation and proof of stake systems like applications use crypto incentives, protocols.

Everything uses incentives, right, in different ways. And I think the sort of experimentation and research side of, you know, using incentives in other systems is extremely under-exported, right? So far, we've done a tremendous amount of work in research as a society on how do you use incentives in your own system with your own token. and there's been very little research on how do you use incentives in other systems, besides, you know, convex incurred, right? And so I think this is deeply under explored,

and I hope that there's just like a lot more experimentation here and people trying kooky and wild things that everybody can learn from and adapt. So I will say there, I feel like there have been a lot of these experiments. Like Solana prior to the FTX crash, I feel like a lot of the DeFi protocols like that you've never heard of were all doing this to one. Like they were, I would argue they were like doing convex and steroids and then FTC happened and then that kind of blew up. Because FTT kind of acted as the base vampire attack token you could kind of use.

So I'm kind of more curious like which ecosystem is PVP enough that this will just become people will do the experiments. My guess is actually hype VM is like a natural place because you have a huge market cap base coin and these small, which you can like earn yield from that was much higher than the market have with these smaller coins. And so if you can incentivize people to leave enough of the hype in your protocol, you can kind of like aggregate enough of some of the other tokens or take over the other protocol. I love that. I love that guess. Yeah. That's my guess. High PVA. Because there's such a big gap in market caps. Well, also the ethos of the chain is like it's PVP by

nature. Purps are zero sum game. Like every dollar profit comes from another user and vice versa. Right. And so the ecosystem, I think, is like from a vibe perspective, I think, well, founded for a little bit of like application PVP in a way that a corpo chain is not. Yeah. And I think Solana pre-FTX was also a little bit more like this than much more than is now. I think, I mean, the other side of the horseshoe is like, I don't know if you guys have been following kind of what's happening in prediction markets where it's like, you know, it's an extra protocol incentive to have something happen in real life.

And obviously the cypherpunk meme is like the, the green plastic object, objects. Yes. People are throwing objects on the WMBA courts. I believe it's been happening for four or five nights now, and now they've had to implement a no-bags policy or like, I saw someone, so they like put up nets. But it's, you know, similarly, it's like you have real money incentivizing people to have some sort of outcome that was not sort of planned for, you know, internally on like the host. And I don't know, I suspect, like, well, like, can you just see more stuff like that just as like the bounty grows? we were worried about Oracle manipulation, but really we should have been worried about

oracles manipulating you. You're not betting no in these markets. Why would you bet no? AMLPs in some cases. Yeah, why is there anybody on the other side of this at this point? Statistics. You're betting against the crowd, I guess. Yeah, you're betting on WMBA.

You're betting on the enforcement policy. Yeah. I mean, there's a price you would bet it. You're not going to bet like, you know, like 99.9.9. right yeah sure they're actually they're paying the wmba bouncers now is they don't get paid cash they only get paid in no shares and uh you know they get zero it out if they don't that's that's actually smart okay i've loved that we found a new business model yeah i like that okay well coming back to this manara story uh they're actually that's interesting to me about this minaro story

beyond just like the surface level it's kind of cool to have AI vampires a vampire attacks What's interesting to me is that like this is a preview of what will someday happen to Bitcoin, right? Because Manera has a tail emission, meaning that the inflation never goes to zero. The inflation, I think it ends at like 60 basis points or something per year, is the tail emission. And many people have talked about, okay, well, Bitcoin, the emissions have every single four years until eventually, I think by 2100 something, it goes to zero, no more emissions at all. and at that point, it becomes trivial to 51% attack Bitcoin,

the same way that you saw that Garth was able to do this to Manero. Now, it's a lot more money to do that to Bitcoin, but as the emission keeps having and having and having, it becomes exponentially easier and easier over time. And so this attack, like this kind of thing will happen to Bitcoin at some point. If this thing just keep, you know, if the price doesn't increase exponentially, If it increases exponentially, then all the GDP in the world is going to go into Bitcoin, which doesn't really seem plausible.

But it's very plausible that the halvings just keep coming. So I think we'll keep seeing this. We'll keep seeing these sort of previews of, hey, this is on the menu for Bitcoin. And Bitcoin needs to have an answer at some point. Not yet. You know, it's not four years away. It's not eight years away. Not if it goes to 10 million.

Of course. Of course. At 10 million, what is 10 million squared? a lot. Yeah, it's a lot. Yeah, it's the correct value. 10 to the 14. Yeah, 10 to 14. 10 to the 14, which is what in?

100 quadrillion or whatever, right? 100 trillion is 10 to, sorry, 100 trillion. It's 100 trillion. Okay, yeah. So that's more than world GDP. Yeah, so if, yeah, if Bitcoin is not, you know, more than world GDP, then it's going to be in trouble. So all that is to say.

So I guess this is again, this is again, one of the, all those weird, these weird things were like, it's proof of work is way more fun to have to, like, reason about all the threat model, but it's also like very annoying in practice. Yeah, no, it is. It is. And to be clear,

I generally think that proof of work is not long for this world. And I think it's probably not the right way to build any new protocols today. Manero might just be just in the line of, you know, it's old enough and kind of has this history. But, you know, as you can see, random acts in many ways,

like actually ASICs are more secure than just having, CPU or GPU hardened algorithms. So there were some, you know, maybe foresight in people who just said, look, embrace the ASIC. I think that was probably the right choice. It's also true that, you know, we don't have these kind of conversations anymore about, like, I mean, these are the things that I remember when I first got into crypto, 2017, 2018.

This is all people talked about is like, oh, you know, is Bitcoin someday going to be insecure and, you know, selfish mining was a pretty new thing. And like, you know, talking about hash rates, distributions, getting too big or too small. and looking back to the corpo chain conversation we were just having, why does it not matter that a corpo chain is an L1 or an L2, to Robert's point?

And the answer is that, well, obviously, the root of trust is the company, right? Like if the company decides, hey, we're turning this off or we're changing this, doesn't matter if your security is quote unquote rooted in Ethereum, right? They're obviously, for all these L2s,

there's so many moving parts that it's not really true that this thing is entirely dependent on Ethereum. And if Ethereum goes away, you know, can just kind of trust all the assets, especially when the company themselves, is the issue of the chain. You're asking for a lot of people in your, your, your, your, your, your, your, your replies with

that statement. I mean, look, if you, the army, the army is coming going to come after. The army's going to come after. I don't think the army is coming. Not for, not for this. Like, if, if, if, if you're Stripe and you're using, um, what's Bridges, uh, stable coin, whatever it's called, the bridge is a state or something. Uh, yeah, yeah, I think that's right. If, uh, if, if your primary stable coin is bridge's stable coin and that's what you used to pay gas and circle is like okay us dc is what you used to pay gas on on uh circle chain then if you just don't acknowledge this fork that you know okay the canonicalization rule on the bridge says this but we say that the end so um that's why i think it's a little bit of a fig leaf to say okay this thing is an ethereum l2 or it's

not an ethereum l2 because we've already determined the fees that they pay to ethereum are negligible So anyway. I mean, I guess they pay in marketing value. Right? Like Ethereum's at all-time high, right? Like what is there to complain about at this point? It kind of makes you seem like a sore... There's always something to complain about.

There's always somebody to complain about. That's the lesson. Ethereum's at an all-time high because Tom Lee can dance. All right, let's be real. That is true. That's true. And also that is not net of inflation because there's been a lot of inflation

between this time and last time that Ethereum hit $4,500. Yeah. So, okay, so let's talk 401Ks. Let's get exciting. We've talked too much cyphepunk stuff. Let's get real, let's get to the real meaty stuff. So Trump recently passed an executive order allowing anybody to buy quote unquote alternative

assets in their 401K, including digital assets, crypto. So that means 401K's now, 401K plans can now offer crypto exposure via managed funds if the fiduciaries deem it prudent to do so. so you're not, you know, that doesn't mean that for sure in your 401k account, you'll be able to buy crypto. It's ultimately up to your 401k provider. So this was largely perceived as being very bullish. There's also, you can also buy real estate, private equity, other alternative assets are now

available within 401Ks. Cool thoughts, 401Ks? I can't wait to buy Dogecoin and make it a 401k. Oh my God. Oh, my God. I'm going to flat myself. This really is the chopping boomer now. Did you plan that?

How long did you? No, no, no. I didn't make that up. It actually came from a Dogecoin marketing video in like 2017 or something. What? Yeah, yeah, yeah. It's a guy who's catching out. It's been a badge in your brain for that.

There's some sequence of neurons that output that thing is crazy. I don't know. Because there's no prospect for 401Ks being able to own Dogecoin ever. And so the joke. was I'm cashing out a 401k to get a 401k9. That was a joke from Doge K9, like almost a decade ago. Wow. This is why AIs will never be humans. Exactly. Memory. They'll never do what Robert just did. That's the power of human creativity was to connect those two things together. That's beautiful. Yeah. But for real, though, I actually think it's phenomenal. I think, you know, assuming that

retirement accounts are managed by fiduciaries, being able to open the aperture of what assets are allowed, is good. It's possible that because, you know, everyone's forced into one asset class, namely like equities that like valuations have gone up over time as a function of like that's the only thing people buy in mass, right? It's possible that by opening this up to new asset classes, that A, you know, the multiples on the giant asset classes like U.S. equities come a little bit down over time, but everything else goes up and everyone is a little bit better off. And capital is a little bit more efficient into where it flows and where it goes. So I think it's good.

This goes to libertarianism. More choices is better. It's not worse. The less choices, the more out-of-whack financial markets get. And so, you know, I think in aggregate, it's not good. I'm sure there'll be stories in like three years of some 401K blowing up because the manager said you can do it all in levered crypto-etifs or something. And it goes hardly awry and, you know, some person suffers a loss. That's comparison.

I don't know if you, I know if you guys have seen all the, there's only two finance, two, two, two, two, Everyone who is in FinTwit love saying there's only two ways the next financial crisis happens, which is either treasury companies grow too big and then there's this leverage crisis. That one's kind of boring. I feel like we've already seen that basically before.

It's like it's not like something crazy. But the one I think that I like the fan fiction one is the GPU debt market grows way too big. And you already are seeing like all the Mag 7 people like borrowing in a way that they've never really borrowed before to finance things. And I think that would be hilarious if sort of like the 401K allowing private investment led to too much GPU debt financing. And then that blew up because the GPU, because GPU debt financing can oftentimes be some

of the stupidest things, stupidest things you've ever heard of because how do you mark the depreciation of the GPU? Because it actually will vary with each chips. And by the time you figured out how the defect rate and how many burn in, you've already like made it to the next generation of GPU. So there's like there's a little bit of a invidia's like kind of Geppetto running the Ponzi scheme of that market. And it would be funny. Like that that's my fan fiction for the next financial crisis from that. So the next financial crisis, Nvidia gets 10 times bigger and all the rest of the major tech companies.

Our debtors to them. too much debt and servant companies. Yeah, yeah, yeah. Like meta is in debt to NVIDIA or something. I don't know. That's kind of a funny fiction. Maybe I'm just like thinking a little too crazyly,

but I think it's into fucking, there's a GPU bailout. They're in debt to the private. GPU bailout. TSSM and NVIDia bailout ever. Yeah, but it's not as direct, right? Like, they'll be debtors to the 4-1Ks that are doing private credit, right?

Yeah. I don't know. It's kind of fun. It's kind of a fun fan fiction for me of that. That is the next financial crisis. It's more interesting than like micro strategy blowing up. Like, who cares? That's not, if that cause a financial crisis, whatever. I'm not, I don't think micro strategy can slow up. They don't have enough debt. It doesn't even like, I'm just, I'm just saying like that this is one of the things people say. I'm not saying, yeah, I agree with you. Well, you've got, you've got Tom Lee now claiming that Ethereum has a sovereign put. That's a Tom Lee line, right? I mean, he's also out there saying, like, Ether to 50K or something like that.

Like, he's really talking the bag better. He's out-sailoring sailor. Yeah, a little bit, a little bit. I thought he said 16-K. Is he saying 50K now? I mean, I saw some crazy numbers. You could be correct. I could be incorrect on this one.

I will look it up after. He's out there, like, ether goes to infinity, you know? Yeah, yeah, yeah. Tom, what are your thoughts? I mean, I think he'll be more concerned when, was it, the GPU financing surpasses the percent of the GDP that the railroads did in like the 1800s. And we actually have another crash. But like, you know, we still got, what, another four or five X to go from here. Thomas reading the same people I'm reading. Yeah, yeah. Don't sell. Don't sell. Don't sell.

Okay. Good. This, this segment alone was financial advice. The rest of the show is not financial advice. I mean, I mean, I think the best financial crisis will be like on-chain lending is used to lend GPU loans. Are we reigning financial crises? Correct. Then it's like, then it's like, you know, everyone wanted crypto and AI. Instead, we got the crypto and AI financial crisis. Yeah, I like that.

I like that. Okay. They already happen. It's called the Monaro 51% attack. That's pretending the future. Very good. Very good. Okay, we had a couple other stories,

but I don't think we have enough time to get through them. So I wanted to have just kind of one last mini segment, given you raised the point to ruin about, micro strategy and like, oh, is this going to be the next financial crisis? There was a debate that we hosted that was actually, Tarun, you commentated, which was a debate between Cosmo Zhang from Pantera versus Gordon, Gordon Leo, I think he's last name, from Circle, who's the head of researchers circle. And they were debating whether or not digital asset treasuries, also known as DATs, are good for retail

and implicitly whether or not they're going to blow up and whether or not they are sustainable. And it's interesting because over the last couple weeks, obviously we've seen a lot of growth in ether and in all coins driven by a lot of the increase in market cap of debts and more issuance and more buying and more more energy being thrown into them. At the same time, we have also seen MNAVs, which are the multiples to nav coming down. So MNAVs have been compressing across the board, which does seem healthy. it seems like a sign of like, hey, that's a good step towards sustainability. If they remained elevated or if they were even increasing, that would be catalyzing more mania. But it seems like the situation is either stabilizing or even compressing to some degree. And it seems now like it's harder for new vehicles.

I mean, we get pitched vehicles all the time. I assume you guys do too. It does seem like it's getting harder for these vehicles to get off the ground and actually be able to go to market. So thoughts on state of play, what's going on in the DAP mania. I mean, Dads be crazy. I don't think that that mania... Are you going to sing the whole the nursery rhyme now? That's be crazy, Jack.

That's be sick. That's good. On the next episode of The Chopin' Clock, we will be doing more song. I fundamentally think that we as a society have exposed a flaw in financial markets a little bit. And I say this from a very like 90,000 foot view. I think micro strategy was the first one to show the cracks of this feedback loop of capital investing in another asset with the force multiplier of this capital, leading to more capital raised, leading to more demand, leading to more capital raised. I think what's happening right now, as it spreads to every asset class, I think, you know, major assets like Ether that are smaller market campaigns. less liquid than Bitcoin, et cetera, like the effect of capital is larger.

And I think this next wave of ether dats is going to be more convex in what happens than micro strategy and Bitcoin has been in a good way. I'm maybe in a bad way in people's fan fiction, right? Like I legitimately think that the rules of how markets work might be a little bit broken right now. And I'm a little bit afraid that these stats are going to get too big, and they're going to accumulate too much ether, and it's going to lead to a mania,

and then something bad will happen, and everyone's going to learn a big lesson from this, in one way or another. So you say it's going to lead to a mania, meaning you don't think that where we are right now is mania. You think there's a mania to come. I do not think we are all the way up the mania curve. I think we're like the fifth inning.

What do you think mania looks like? How will you know it's mania? Mania looks like... Why does everyone who talks about Dats use baseball analogies? I don't know. Maybe it's a me a medic thing. some inning is opposed to like X percent of the way. Why is everything?

Use the inning and out of five. That's an out of left field comment. Yeah. No, Troom has a good batting average on his comments. I feel like that was pretty good. That one, that was a little foul. But I don't think we're, yeah, I think we're like roughly halfway. I think like, you know, what does mania look like?

How will we know it's mania? Give us the mania sort of tour guide. What are your, what are your mania signals? Okay, here's the media signals. Like, do you guys remember the tech boom in like the late 90s? When it's all anyone to talk about anywhere? I was a child. I don't remember it.

I was also a child. I do remember the pets.com ads that stopped. Yeah. No, like when it invades like the mainstream conversation and it becomes the mainstream conversation, it's all people talk about. Like, I'm sure it was the same way with the railroads. It is true. It's a shoe shine boy tip.

I've been in multiple Uber. Yeah. where the Uber driver's been trading XRP. I've been seeing a lot of XRP. I know, but Uber drivers have been trading XRP for years now, right? Yeah, yeah, but the more often you see it, the more you know that people are like, you know what I mean? Totally.

While you're in the car and they're driving and they're trading XRP, you're like, all right, this is like, the urgency is high. Totally. I just think there's the possibility that capital flows from the, quote, real economy and the tech economy into the debt economy, because it becomes extremely cyclical. And I think it's possible that crazy things happen, right? I think it gets way bigger than it is today.

I think we're seeing these massive flows of capital that are moving markets when these dads, like, especially in the ether side, are like a billion, three billion, right? These stats can easily get to be $10 billion, $30 billion. And I think it can have a significant effect on the underlying assets in an unsustainable way. and I think it's going to get, my prediction is that everything goes up way higher and then crashes

in a massive fashion. I agree that there's going to be an unwind. At the same time, like, I feel like the critical thing to be watching, capital flows matters, but I feel like the critical thing to be watching is the MNAVs. And like as long as the people perceive DATs as machines that magically wrap an asset and make the rapper worth more than the underlying, people will keep wrapping things. That's how capitalism works. That's what the price signal is.

It's supposed to be an incentive to keep doing the thing that makes prices go up. So as long as DATs are this, like, magical wrapping paper, people will keep wrapping every present they can possibly find. But I think already I'm seeing that going away. Now, that speaks nothing of micro-strategy, speaks nothing of S-Bed or BitMine. And so these, the big Dats, they may stabilize. There may be, like, no new ones. It may be like, okay, now it's got a micro-strategy and the seven dwarves.

and like there's no, there's no real room for anymore. But even as those guys are at scale, if the MNAVs are compressing, I don't see a reason why these can't just exist in equilibrium. Now, I agree with you, crypto cyclical. Markets are cyclical. And when the cycle goes down,

these, they have to sell the underlying. That's just kind of how capitalism were, or like shareholders, shareholder capitalism works, is that shareholders will demand that they sell the underlying in order to buy back the stock.

But that, in a way, like, that's already how crypto, what happens in crypto is that, yeah, things go down after they go up. I would add maybe two things. One is Cosmos' argument that your thing was horrendous. He missed the most obvious positive reason for DATs, which is if the assets held by the DATs can earn yield, then they should have a positive MNAV, right? Because arguably the reason these things have grown so much is because like at the SEC was

like lazy about staking ETFs. Like realistically, I actually... Once ETFs allow staking, like that argument does also fall away a bit. No, no, no. But the thing is the DATs went from zero to 99% staking on, like, day one, right? Whereas, like, staking ETFs have taken so long. They have all this volatility drag. They have all these requirements of how much can be staked.

Well, there is the Osprey sole stake TTF now. But all of them don't stake everything, right? They, they, they're not as max yield. They're not as max yield as the, which is an obvious reason that these things should be valued more than the ETF. Like, it's different than the Bitcoin. ATF because there's actually this drag cost that the ETF regulations force you to like keep some not earning yield whereas like these companies can do whatever they want. Lido is not a security now so you could use you could use staked Heath.

Yeah, but like they have requirements on like concentration limits for them of like, especially for the in-kind redemptions. Staking ETFs are actually now kind of a shit product because this is a way better way. If you want that exposure, you're a public market investor. you don't want to know what a BLS signing key is at all. You would hope to never hear that in your phrase. It's a very different product, right? I mean, it's a closed-end fund, basically,

that you're going into and selling your position. It's a total of fund that's getting yield everywhere on chain in that ecosystem. So, like, in theory, if the ecosystem yield is going up, the M-NV should be positive, right? Right, but the M-NAV is so volatile relative to the underlying yield, right? I don't disagree. That's because everyone's trying to price, like, what are these companies actually going to do with the assets? But, like, they are actively trying to deploy them. So I think that that is to me a real reason that they should have a positive MNAV.

Now, to your point about the equilibrium, yeah, if you have too many of them crowding each other out on the yield trades, then that's bad, right? Because then they're going to collapse each other's MNAV in the kind of long-term limit, not this current mania. They'll obviously be a trough of disillusionment, but I actually think they are, there's a sense in which they're more efficient ways of getting on-chain yield for like GameStop put buyers who are like, I want Ethereum yield. but I don't want to know anything about how I get it, right? They're just more efficient than they care. Do they want like 3% yield? No, but like, I mean, they can do levered staking. Like, that's my point.

It's like the treasury companies can go loop whatever, right? They're not. That's true. That's true. That in and of itself should mean their MNAV is way higher than the staking ETF. Right. Fair. Very fair.

Okay, well, we are, we're up on time. I believe Tarun and Tom have a dinner to be late for. It's Leshner's fall. I guess. Yeah, we've got to wrap things up. Yeah, play me. It's all good.

It's all good. Thanks, everybody. We'll be back next week. And we'll follow up on the dad story. See, everyone. Yeah.