Unchained - The Chopping Block: Hyperliquid vs. Tarun, ADL Transparency & The Coming Perps Arms Race - Ep. 981

Episode Date: December 17, 2025

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. This episode features special guest Vladimir Novakovski, Founder of Lighter, joining the crew to unpack the fallout from October 10’s historic perpetuals liquidation event and the ADL research that sparked a public clash with Hyperliquid. The panel digs into how auto-deleveraging really works, why these failures were long hidden inside centralized exchanges, and what decentralized perps must fix to truly outperform TradFi. The conversation then turns to the intensifying perp wars. With Lighter’s zero-fee trading model, premium tiers for pros, and a looming token launch, the hosts debate whether crypto is headed for a Robinhood-style fee reset, why TVL may matter more than volume, and how RWAs, FX perps, and cross-margining are reshaping market structure. Finally, they tackle the growing divide between tokens and equity as devcos get acquired and tokenholders are left behind. Perps are evolving, incentives are breaking — let’s get into it. Show Highlights 🔹 ADL research ignites a firestorm — Tarun’s paper on auto-deleveraging sparks a public clash with Hyperliquid and Paradigm, exposing how opaque ADL systems really are. 🔹 October 10 liquidation shock — Repeated ADLs during crypto’s largest liquidation day reveal structural fragility long hidden inside both CEXs and DEXs. 🔹 Fairness vs predictability in perps — Why traders care less about perfect algorithms and more about knowing when and how ADLs will hit. 🔹 Lighter’s design tradeoffs — Vladimir Novakovski explains Lighter’s less-aggressive ADL approach, insurance fund buffers, and trader-friendly risk parameters. 🔹 Zero-fee perps debate — Lighter’s free retail tier + paid pro tier raises the question: is crypto headed for a Robinhood-style fee reset? 🔹 TVL beats volume — The panel argues TVL is the most honest signal of trust in perp exchanges, especially during market stress. 🔹 RWAs and FX perps surprise — Euro and index perps outperform expectations, challenging assumptions about which real-world assets actually trade onchain. 🔹 Tokens vs equity explode — Devco acquihires (Axelar, Tensor) leave tokenholders behind, reigniting debates over incentive alignment and crypto M&A. Hosts: ⭐️Haseeb Qureshi, Managing Partner at Dragonfly ⭐️Tarun Chitra, Managing Partner at Robot Ventures Guest ⭐️Vladimir Novakovski, Founder & CEO. Lighter. Links: Tarun Chitra’s Autodeleveraging: $653 million lost to a greedy heuristic? 🔗 https://x.com/kenchangh/status/1994854381267947640  ⁠Disclosures⁠ Timestamps 00:00 Intro 01:38 Tarun’s ADL Paper Sparks Backlash 05:24 Research vs Bag Defense 06:27 How ADLs Actually Work 12:27 Fairness vs Predictability 24:14 Tarun’s Inspiration  28:17 Zero-Fee Perps Explained 34:12 Perp Wars Heat Up 38:15 RWAs Trade Onchain 41:49 Token Launch Reality 47:19 Tokens vs Equity Clash Learn more about your ad choices. Visit megaphone.fm/adchoices

The goal of decentralized exchanges is to improve upon centralized exchanges. And one thing is a lot of people who work at centralized exchanges, DM me and said, like, hey, these ADL, like, repeated events have happened before at centralized exchanges. But no one knew because you can't really see it, right? There's no public data. You only see yourself getting ADL. You don't see other people, so you can't measure, like, how big of an event it is. Not a dividend.

It's a tale of two pawn. 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 D5.Eight is the ultimate DFIProticles are the antidote to this problem Hello everybody, welcome the chopping block Every couple weeks, the four of us get together

and give the industry insider's perspective on the cryptot topics of the day. So quick intros, first you got Tom, the D5 Maven and Master of Memes. Hello, everybody. Tom is at a party, apparently he was too cool to show up on time. Next we get to Rune,

the gig of Brain and Grand Puba at Gondlet. Yeah. And joining us today, we've got special guest, Vlad, Leverage Legend and Leader of Lighter. Welcome back to the show, Vlad. Wow. You guys, you're good to join for the late-night session. That's right. That's right. Actually, it is very late at night right now.

And I'm a Steve, the headhike man at Dragonfly. We are 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 Chopping Block that X, XYZ, for more disclosures. So, welcome to the late-night version of Chopping Block, brought to you by the Chopping crew. So we brought Vlad on the show today because there's been a lot of drama going on in Purpsland specifically. So right at the end of the last show, we were actually running up on time and we got some angry letters from our viewers that we gave very short shrift to Tarun's ADL paper. So Tarun had just recently released a paper on ADL. ADL stands for auto delveraging.

This is a process that happens when basically a market is moving really crazy, fast in a perps market, and it must forcibly close out positions in order to de-leverage the market. This is called auto-de-leveraging. And it's a very edge-casey kind of thing. But of course, it happened repeatedly across many, many different venues on October 10th, which was the big day where we saw the largest number of liquidations in crypto history. So Tarun, being the kind of dutiful researcher that he is, wrote a paper trying to analyze what's going on in the world of ADLs. And this is a space that has not been given very rigorous. academic attention.

And so I think Tarun, as far as I know, is the first paper, you can correct me if I'm wrong, the first paper of its kind that's been written on the subject. There's one paper, there's one paper before me, but I don't think it formalizes ADL itself, but it does kind of formalize what Bitmex did, which is made by Kyle Soska, who is the chief CIA at whatever Floods Fund is called.

I forget. Okay, well, there you go. Yeah. So you released this paper, I think, soon after the last show. And immediately after you release this paper, it triggered a firestorm. So there was all sorts of angry people.

So I should note that one of the headline claims in your paper was that hyperliquid, over-aggressively auto-de-leveraged traders to the tune of hundreds of millions of dollars in counterfactional P&L that was lost by traders or something. Correct me at any point, if I am mischaracterizing what the claim in your paper was. Yeah, I mean, I will, I will, anyway, later walk through the exact thing as we want to explain my story. Can't wait.

Can't wait. Okay. So the hyperliquid crew led by Jeff, the founder of Hyperliquid, who's been on the show, Jeff tweeted in what is now an infamous tweet, I think he said, those who can do, those who can't fud, and basically said, Teroon's paper is total garbage, can't believe these are the people you look up to as academics, this is bullshit, nothing in this paper is correct, totally mischaracterizes how hyperliquid works. Tarun then clapped back and said,

wait, no, you know, you guys are misunderstanding my paper, blah, blah, blah, then Dan Robinson from Paradine. Paradigm also a big investor in Hyperliquid. They ran the big hyperliquid dat. Dan Robinson from Paradine came out and said, Tarun, I am also fellow academic. You are totally wrong. And the two of them just started sparring for about a week

of just going back and forth and dueling threads, mostly in latex, describing each other as morons in various different ways. So it was kind of a Battle of the Titans. It seems to now have been resolved. So for whatever reason, all the conflict that was going on between the two of them, now apparently your best friends. And Dan Robinson announced that he was going to be helping some of the data analysis of the V2 of the paper,

incorporating some of the feedback and corrections that many people from the community ended up giving you. But it sounds like it was a very harrowing week for our hero to ruin. Yeah, my eyebags are for those who actually watch on YouTube. My eyebags are much larger than normal. Yes, yes. the misadventures in talking about ADL. So, Tarun, tell us, how's your week been? It was like, basically I posted that.

We recorded, I posted that, and then I got on a flight to Abu Dhabi, and I didn't have internet on the flight. So, you know, I landed, and then I saw the Jeff response. So, like, I hadn't realized the commotion that had happened. There had been, like, a little bit before I boarded. And then when I landed, I was like, oh, wow, I caused the shitstorm. I think it was a good lesson in, like, how research has changed in crypto, in my opinion, over the last five years. Like five years ago, you read a paper.

People are not immediately like, oh, you're fudding my bags. Like, get the fuck out of here. You wrote this research strictly for fudding, right? Whereas, like, now it's, like, immediately assumed that you invested in lighter or drift or whatever, so you must be fudding my bag. So that was annoying. But I think, like, broadly speaking, I just kind of think the. attacking thing is like kind of gone a little crazy the last few weeks. Like I think for instance,

there's been like lots of other research kind of trying to attack Polymarket and Haseeb and Tom, maybe when Tom's here, he can talk about that as well. That there's sort of a sense in which some of it feels a little bit unfair, targeted, especially when there's like, things have real merit and things that don't.

But the idea that all research is marketing and that the marketing is like a meat exists only to fud someone I think is somewhat disheartening because you can't really write anything without getting people mad. Now, I will try to explain in the simplest terms possible, like, what I stated, what I got wrong and like what is still right. So Haseeb mentioned auto-de-leveraging and sort of this edge case event. And so for me, October 10th was sort of like a crazy, very crazy day. I think I talked to Vlad like right after and I was like, it's like kind of insane that ADL was triggered. 20 times in a row or whatever.

Like you just don't see, it wasn't invented to be triggered multiple times. And on October 11th, there was a tweet, a thread by someone who I think this is the first ever tweet thread that I, at least that I recall, which is Don Wilson from DRW, who, large market maker, very big tradfi, HFT player, does a lot of stuff. Person I have a lot of immense respect for. And he had a very good point in point, which is like, if crypto can't fix ADL, if they don't make it so that it's friendly for traditional players, we're just going to have the FCM system,

which is like the clearing system that we have in normal tradfite, where you have these counterparties, these third parties, who basically you have to effectively custody with in some indirect way, and they take the risk of these kind of rare events, like they can lose their capital, but then you have to pay them fees to do that. And I think that tweet thread just made me say, like feel this thing about decentralized exchanges, which is, okay, we have to have something

that's better than this. Otherwise, like, yeah, if we end up into FCM land, then we're basically back to centralized exchanges. Because FCMs, again, it's like, it effectively means someone custody is your assets. And so actually a couple of weeks before I put out the paper while I was still working on it, Arthur Hayes wrote this really good blog post about the history of liquidations and ADL in perpetual markets. I highly recommend. You know, he has a lot of posts that maybe are just like price posts, but this one is actually like a history of like why the perpetual future became,

you know, had certain things in it that it did. And so the history of ADL is in 2015, Wobie, the exchange, added this algorithm for dated futures, like futures that, you know, expire monthly, effectively. And what had happened is prior to 2015, Hwobie had basically said, hey, if you get into this, so ADL is basically when no one can liquidate a position profitably, effectively. And so the exchange, in order to stay solvent, has to take some of the winners who have

positive profits to cover some of the negative profits. So it's sort of, you know, if I'm a winner, I made $100 on the exchange, but there's this person who has negative equity, sort of like their profit is much less than the collateral they put, and no one is willing to liquidate it. then me as the winner, I socialize the loss. I pay some of, I cover some of their loss. And that is, that is sort of at a high level what this like lost socialization type of thing is.

It's just like in a case where you can't remove insolvent positions, you take money from the winners and try to regain solvency. So, Chloe, before that. It's also opposed to like the old school loss socialization is literally everybody gets a haircut, right? Like the loss is split parada among everyone. That used to be the way that, it worked before ADLs became the predominant way that it's done.

One analogy that I've given to somebody who's like very not in crypto about ADLs, it's a little bit like when a company declares bankruptcy. It's like a stop the world, nobody move. We are now going to reorganize the debts to make it so that this company can like start operating again. And then it's like, okay, great. Now we've cleaned everything up. Now this company, you know, it's too bad, so sad that, you know, you didn't get everything

that you wanted, but the company's in bankruptcy and you set it out in the world again. And if you have to, if immediately after you send a company out after bankruptcy, it declares bankruptcy again, it's kind of like, okay, this is really not designed to do this. And I think that's kind of the core of what Terun's paper was getting at, if I can give my, you know, kind of 90 IQ. No, no, that's actually good now. I like that. The interesting thing, just in hindsight, is Wobie apparently was pre-2015 was just paying out. Like the exchange took the risk on their balance sheet. So when the bad debt happened, they would just cover it with their profits.

And then apparently some event happened in 2015 where they just lost so much money. And there was sort of moral hazard. And Arthur's Post talked about other exchanges where this happened where by the exchange, everyone knowing the exchange would pay out, people started taking riskier and riskier positions because they were like, the exchange is going to cover it anyway. It's like heads, I win, tails you lose type of thing. So anyway, I was sort of of this mindset that like, hey, if this can't happen, again. Like, and people have basically, oh, and so Pobobe and Venice algorithm, Bitmex adopted it

for perpetual futures in 2016. And then Binance copied in 2019. And then since then it's kind of effectively been the standard where you order all the positions from largest to smallest, according to some metric. And, you know, the metric varies a little bit, but most places, it's the profit times the amount of leverage. And then you, you start haircuting people one by one until you cover the bad debt. Now, the goal of the paper is like, hey, are there other methods we could use that would do better? Like, are there other algorithms that you could do? And so the paper shows there are other algorithms. There's also trade-offs, like some things you can never fully get rid of, like this moral hazard type of stuff. There's no, as an exchange grows,

you're inevitably going to have that. And also some notion of fairness to traders. This, algorithm I just described, but I order them one by one and then knock them out, is kind of unfair to the top person, right? Like, from the top, trader by leverage in P&L. I'm the first one to get cut out. And I think this was actually on social media, a lot of the complaints about ADL. It was like some people,

you know, some people certainly made money. They happen to have the right direction, but some people happen to have the wrong direction and where they felt penalized for that. Vlad, I want to bring you in from what you saw, from both what happened on 1010 and like your learnings

in terms of how lighter implemented ADL and also from your discussions with Turun, what do you take away about the design space of that we've learned or that you've learned personally? Yeah, I mean, I think that Tarun's paper, to me, like there was a lot of, like, interesting analysis of how different algorithms could work and, you know, simulations of those algorithms and different scenarios. Like, I think there's a lot of cases to think through it, like this algorithm where,

kind of like this greedy algorithm, right, where you start with, like, the biggest, profit's biggest positions. I mean, that, from a certain perspective, that makes sense. On the other hand, like, if you're doing some kind of like Paris trading position where, you know, your long, eth, short BTC, then that algorithm isn't very fair to you, right? Because, like, you've actually, yeah, like, you have this one leg of the trade that did very well. And maybe you could say, well, you could take a bigger haircut on other traders, but you actually had a full loss on the other side.

So, I mean, I think to me, like, Part of the point of the paper is you can't necessarily design a perfect algorithm. So there's also the question of like, I guess from where we sit at lighter, like, we want to verify that everything we did is fair. And to do that, you know, we have to compute all of these claims and kind of generate ZK proofs of them. So like if the algorithm is too complicated, that creates other problems in that you can't really prove it. anything close to real time. So our algorithm actually is also pretty, pretty heuristic based. I guess one difference is that it's just less aggressive.

It's not the vanilla Q algorithm that, you know, it is. I mean, I think it is similar to that as well, but there's parameters to it, right? It's like there's, there's the queue, but then there's a parameter. It's like, when do you start pulling from that queue? So you can kind of use the insurance fund, which for us is the LLP, like up to a certain point. And then only after that you start pulling from the Q. So there's parameters like that as well. I think like in a perfect world, if the computational throughput wasn't a factor at all, then probably some combination of the kind of the greedy algorithm and the socialized algorithm would be best.

but there's yeah from our perspective is also the computational aspect to consider but in general we've tried to make the system kind of just like friendlier to traders and i think you saw that on october 10th but you mean that with respect to lp taking on some of the liquidations as opposed to rejecting them yeah that's right that's right and uh i mean lLP did take a hit that day but a lot of traders didn't have losses that they would have had otherwise right And in fact, like, I think we've made this point before, but, you know, LLP was down 20 million that day. But that also means all the other traders collectively made 20 million since, you know, perps are zero sum. So by now, you know, LLP has made most of that back as well.

So, you know, something like that happens every five to 10 years. That's from our perspective. That's the right tradeoff. But I think that's a little bit of an orthogonal point about, yeah, go ahead. Yeah. Well, one of the points that we were making on 1010 is that part of the reason why 1010 was so disruptive was because it was very unpredictable, right? People who thought they had hedges in, those hedges exploded. And a lot of this, of course, is because you can't just net on a single exchange and understand what somebody's exposure, what their risk profile is.

because if I'm super long on hyperliquid, but I'm super short on lighter or vice versa, somebody, you can't tell in isolation, oh, this person is like, oh, this person looks really risky, but in reality,

they're taking what they think is like, actually a very safe position across two exchanges. But the moment that you blow out one of their hedges on one side, all of a sudden, now this person is taking a lot of risk, and they start going topsy-turvy and all sorts of chaos ensues. And so it felt like this is one of the points I think that Anand made in response to your paper Tarun is that one of the most important things is just predictability.

It's just the ability for large traders, market makers, you know, people are doing carry trades, for them to be able to understand and predict when ADL is going to happen and what happens to their positions on net when an ADL takes place. Yeah, look, I don't disagree with you. I just think, or with that claim, I just think there hasn't been many open source. implementations. The documentation for this doesn't, if you read everyone's docs, they don't really lay out what they do. And I think, you know, the controversy is because of how I estimated the number, because I made a mistake in the paper where I haircut the entire position, so profit plus

principle, versus just haircutting the profit. And like, it turns out that the space of algorithms doesn't change. All these, like, improved algorithms that the paper claims still work in the profit space. But generally speaking, the winners on hyperliquid were over collateralized in the sense that they had 13% of their positions were P&L on average. So I sort of overestimated roughly by a factor of seven. I'm working on getting the exact number. But you can roughly think of, like, the papers at $650 million. It's probably more like $100.

but there's still this amount that was over-liquidated by this algorithm. And fundamentally, I think that is a sense of unpredictability, especially if you can't verify the state of the algorithm. And you could, because it's not open source, there's no explicit description of what the code is doing. It just kind of tells you I'm going to rank you and then liquidate you. And to Vlad's point, there's a ton of parameters to that, how you do those, when you maybe go to a liquidity pool,

like an LLP or HLP, the timing, like how aggressive you are, maybe you, instead of fully liquidating, you partially liquidate. There's so many parameters that if you don't see the source, you don't really know what's going on, right? So I think that's certainly why E. Dot HLs went after me and still are. But I think there's still a funnel of directional truth, right? Even if the magnitude is wrong. Well, I mean, the only reason is because also you're an investor later,

so which I think you mentioned that, but just to underscore it even more, that's a big part of the reason why they went after you. Yeah. But I want to kind of underscore one final thing, which is the goal of decentralized exchanges is to improve upon centralized exchanges. And one thing is a lot of people who worked at centralized exchanges messaged me, DM me and said, like, hey, these ADL, like, repeated events have happened before at centralized exchanges. But no one knew because you can't really see it. There's no public data. You only see yourself getting ADL. You don't see other people. So you can't measure like how big of an event it is. But I, I, I talked to some people from Pobie who were working at Pobie 2016 to 2018, and they said this occurred multiple times, and Pobie just paid people out. So, like, it basically reverted to insurance fund once they, you know, they did the ADL, and then if it's sufficiently large, they had enough complaining traders that they paid them out. And you can't really do that at decentralized exchange, right?

And I think that's sort of why you need it. You can do all sorts of stuff if you are sufficiently motivated. You've been a defy long enough. like, you know, your token is an insurance fund is like the meme, right? That's true. That's true. I guess, like, yeah, maybe that's fair. But it's interesting that this was the first time you could see this event, right?

Like, we should kind of be. And that's to hyperliquids credit is that like, okay, you know, maybe you can't read the exact ADL algorithm, but you can see all of the ADLs. You can see the record of this person was closed at this price at this time on this chain. Otherwise, you wouldn't have been able to do this analysis at all. Yeah, exactly. And I think like that that's already an issue. improvement. The other element of this, of course, is that you were sparring not just with the hyperliquid.hels,

you were sparring in particular with Dan Robinson. And, like, I want to ask you about that because the fact that paradigm was a big investor in Gauntlet, wasn't it? Yes. Still are, I guess. Yeah. Still are. Yes, presumably still are. So any reflections on getting into a sword fight with your lead investor. You know, I, I guess you recently had a podcast series about the same type of thing. Did I? Wait, what? Wait, who did I get in a sword fight with? Santiago. Oh, oh, we Santi. Oh, that's true. Yeah. Okay. I'm his, okay. Yeah, yeah, you're right. Yeah, right. Isn't that the same same kind of thing? Yeah, yeah, that's right. Fair enough.

I just think, obviously, I'm not trying to create more beef. I have my own opinions and thoughts as to what motivated the level of aggression, but I won't share them. But, you know, I think things could have been handled differently, but, you know, at some level, I'm just kind of happy. It's over because, like, it was just a lot. because I feel like I spent two months doing this as a labor of love. And like, you know, like there's nothing I expect to get. There's nothing I expect to get out of it, right? It's like I'm not, it's like literally a public good.

And I feel like I was like, you know that meme of like the open source software developer who like there's like 500 people in their GitHub issues saying like, why didn't you fix this thing? Why didn't you fix this issue? And it's like this person did this for free. Yeah. And like is not really gaining much. is in fact only losing based on the last week.

Well, there's two elements of it, right? Like, one is that it's like that saying from the wire, you come at the king, you best not miss. Is that like, look, you come after hyperliquid? Like, you better come correct. You better bring the receipts. You better, like, have all your shit together. So that, there's a part of that that's true.

There's another part of that, like, yeah, people don't know what the culture of crypto was like before the kind of modern token industrial complex, you know. Like, in a way, it's almost like, I feel like there's a little bit of, I don't know, like, think like farmer research, right? Like, I could not imagine reading pharma research and not just being immediately jaded. They're like, obviously this person is fucking paid by pharma to like get some result. They're like, oh, antidepressants are like great.

And I'm sure there was some time when like people were just in farmer research for the love of the game and people were like experimenting on themselves and like, oh, you know, I wonder if this thing will reduce my dandruff and like their haircuts are fired. like that there was a time when that was that was like actually how it worked and I remember when you were writing papers about defy like about like the staking rate versus like the organic yield that was on chain and how that produced instability and consensus like you were writing papers like it wasn't like oh man you're really why are you running a compound we're like oh why are you talking shit about maker Dow it was just yeah we didn't know and so we were all exploring this like giant terrain together and now it's like well everyone's got a bag everyone's got yeah and look it's different now you're an investor And so it is genuinely different. And like we have genuinely grown up. And we are in the pharma era. So like you kind of got to respect it.

Like yeah, you can't pretend to be the guy, you know, putting dandruff thing on his on his own head and just being like, oh, what do you know? Look, head and shoulders is the best dandruff shampoo. It's like, okay, well, you got to, you know, you got to, you got to know how people are going to perceive it. So I can see both sides. I can see both sides. That's my. I clearly did not know that. And I was really, I will say, I was mainly inspired by, like I said, this Don Wilson.

tweet because like he's been around a lot right he lived through March 12th 2020 which in Tradfai had a number of really crazy events including one where like these people who are supposed to post collateral on your behalf these FCMs a bunch of them went bankrupt and trading firms who were profitable went bankrupt because the person who's supposed to post collateral on their behalf for this kind of lost socialization didn't and then the exchange closed everything Vlad and I both know some people who are indirectly hit by this kind of blow up. And I think it shows the weaknesses in the Tradfai system too, right?

So Don has seen that. And I think he has probably the best perspective at anyone in crypto because he's been on boat. He's kind of been in crypto for all, right? Like Cumberland's been training here forever, right? So he's kind of seen this grow up. So I just like had a lot of like his statement basically felt like this almost existential thing, right? Which is like either you fix.

all this shit. Or we're just going to go back to FCMs, which is like kind of a sad to me, that's like if crypto ends up just with FCMs, like these like clearing agents, like that's sort of just like a sad ending for derivatives. Like the point for bearer assets, self-custodial stuff is like you don't need that, right? You shouldn't need that. To me, that's like fundamentally the main thing I was kind of cared about and why I kind of went down this rabbit hole. Glad what your take? FCMs? Is that FCMs bearish? Yeah, I mean, I think there's definitely, it's an interesting problem, right? It's a hard problem.

I mean, I think there's different solution spaces here, right? Like, I think, for example, like options, like maybe, like, one thing I always wonder about is like, why, why isn't there more emphasis on options and decentralized markets? Like, I think options would actually make some of the stuff cleaner in the sense that you could take. leverage in ways that aren't going to bankrupt the whole system. So, I mean, I think that may be one area that there will be more shift towards in the coming year. But also, yeah, I think having, I do think this kind of research is a public good, right? I mean, I think understanding this further, like, certainly like our team, when we looked

at the research, like we learned a lot and, you know, it'll influence how we think about, like, future versions of, you know, as we iterate on the AD algorithm. So, yeah, I mean, I think and yeah, it's like people who have positions on different exchanges, even within a single exchange, you may have positions of correlated assets or like spot versus futures. Like, like, I think that it's, you know, these are hard problems and, you know, we'll, I think, I think, having, I think, to see, to your point about like ADL, that this shouldn't happen very often in the first place, right?

I mean, I think that's part, part of what we're trying to get to as well. So today, you know, speaking of should not happen, today we had another day of leverage wipeout. It was something like $400 million that was wiped out today in terms of leverage. But it does seem like in terms of the on-chain volumes, on-chain volumes are hitting a fever peak. A lot of this is driven by. anticipation of lighters TGE, which I believe is coming soon. And again, fair notice, both

the Dragonfly and robot are investors into lighter. Right now, you guys are the number one exchange by 30-day per volume, as well as seven-day per volume. There's some markets right now on Polymarket that are anticipating when theirdrop is going to take place, supposedly at some point over, you know, by the end of the year. But, you know, who knows? Polymarket obviously seems to be fairly confident in that. And there's been some news, I guess, recently about some new, well, there's been some conversation about the fee model of lighter, which seems to come up again and again. So just to reiterate the way that lighter works. So lighter, unlike hyperliquid, in lighter, there are two ways that you can decide to trade on hyperliquid. One of them is

with zero fees, but if you're paying zero fees, you have increased latency. So there's like a quote-of-quote speed bump that you're paying if you're not paying, if you're incurring, if you are a normal trader. If you want to pay for lower latency and API access, there's like a, what is it, I don't know what it's called, but like a, yeah, the premium tier. There's a premium tier that you pay for that does charge fees if you want to be able to trade faster and this is where more pro traders tend to trade. And so with this structure, so lighter has become quite profitable. It's making significant revenues as an exchange, but it's doing so despite the fact that for a majority of retail traders, they're actually on there paying zero fees. And this is, I think, part of the reason

why it's attracting quite a bit of volume in addition to the anticipation of theirdrop. So talk to me, Vlad, about, I've seen a lot of people going back and forth about how they feel about this pricing model. Do you think this is where crypto trading is going? There's been a lot of comparisons like, well, you know, Robin Hood kind of did the same thing where they introduced zero commission trading and they kind of took over the old school brokerages, which all. charge commissions. It's a little bit different. It's not exactly the same thing, but it kind of rhymes. Talk to me about how you see the pricing of fees in crypto perps. Right. Yeah. I mean, I think, you know, I was thinking of something Tarun said earlier,

which is like, in the ADL context, it's like, you know, I guess who will be tried and other exchanges copied it? I feel like the same, that's kind of how I feel about the fee models of that have existed were, I don't know, the first 10 years of perps trading, where they've all been kind of pretty much the same. There hasn't been much innovation there, even though

in Tratfi, as you said with Robin Hood and others that followed, there has been a lot of innovation there. Like, I think for us, like, I think there are like kind of three reasons for this fee structure, right? One is philosophical, kind of like democratizing finance. I mean, that's part of why we started building lighter in the first place. Two, right, like when you think about two-sided markets, right,

if you have kind of retail and you have professional trading shops, like, you know, the professional trading shops, they'll adjust. Like the harder part of the marketplace to attract is the retail. I mean, retail has a lot of options. Like, there are a lot of products they can try. Like, whereas, like, the professional trading shops, they're active on many exchanges. Like, if they're making 100K a day trading on later and then now they have to pay premium fees, now they're making 80K, like, they're still going to stay, right?

Like, that's still, they're running a business as long as it's profitable. They're going to keep doing it. So that's the kind of second reason. I think third reason is it actually I think is like better for the market in the long run because it expands the universe of traders and possible trading strategies when you have the zero fee tier. Like maybe there's some traders who wouldn't be in the market at all, but now they're in the market and they're doing like scalping or like maybe someone who's retail is now, maybe they would have been training once a day

and now they're trading three times a day, right? So it's like if you expand the opportunity set, I think that's better for the market in the long run. But how exactly that will play out? Like I think we are seeing some of the other builders in the space experiment with V models like ours or other variations of that. But how will that play out? Is it going to take, like even with Robin Hood, right,

I think it took five years before other major players started to try their few models. So I don't know if it's something that will see a very immediate shift. Crypto moves much faster than any other industry I've seen. It's true. It's true. You know, like the time it took from like Bitmex to Binance or like from, you know, old school Bitmex contracts to like Binance completely changing the game was like a year

and a half. Right. Yeah. No, it's true. But I guess it would be like kind of presumptuous to say, oh, well, in a year, or every you know this will be the state of play for the whole industry but we i mean we certainly believe in it right and we're going to continue it's nice to see because i think like like six months ago when we talked about this it was kind of theoretical and it was like oh this will never

work right and it's similar to when i remember in the early days of robin hood where i was an advisor like same kind of feedback so it's nice to see that it's it's actually at least so far working right But now that we've added spot, right, that's also interesting. Right. Now some of those stuff we're going to be working on that we are working on that we're going to be releasing soon, right? It's like you'll be able to do, I mean, you can already trade spot for free now, right? But like with native bridging to and from Ethereum, like it'll open up some interesting possibilities there too. And I think part of like, you know, why because right now we only have one asset.

on spot, which is ETH, I mean, that's going to change soon. But even with that asset, like there's been some pretty healthy volumes. And yeah, I think the fee structure has a lot to do with that. So beyond that, let's also talk the product roadmap because, you know, one of the things, so right now, hyperliquid, de facto leader, you know, although right now, both you guys, Aster have been leading in volumes in terms of open interest, they still remain the king. they recently launched trade xyz which is their RWA trading platform you can trade on you buy NASDAQ perps you can buy Tesla perks etc doing pretty pretty significant open interest at this

point my understanding is that you guys also have your own offering on that front as well as hyper liquid just announced cross margin allowing you to margin the same account with not just USC but also I believe they just added hype as the other margin asset and they plan to add more overtime is my understanding. And you guys also have cross margin on your roadmap. Give me a sense from sort of the inside baseball. Because now, you know, it used to be that basically hyperliquid, totally dominant, left everybody else in the dust, right?

Like them versus D-YDX or them versus, you know, synthetics or whatever. It was kind of just, you know, it was really like BitMex versus everybody else. Now it's a horse race. Now it really does feel like there are a lot of credible players in the same market. And there's a lot of product competition in terms of features. and trying to keep parity with each other and stay at the vanguard. Talk to me about what that's like from your guy's perspective as a team. Yeah, I mean, it's, to be honest,

like it's been a lot of fun, right, to see new features. And, you know, I think part of it is coming from hyperliquid, but also other competitors. Like, for example, us team, I think, was maybe the first to really lean in on real world assets. And now we've added FX. I think it's been, it feels like a lot longer. I think it's been a month, right?

And actually, like, the open interest there has been quite, especially on, you know, the euro. Like, this has actually been pretty, pretty high. But I guess to your bigger point, I think, like, for us, like, building on top of Ethereum is really important to how we think about the roadmap, right? And so really, like the vision is that any asset on Ethereum can be collateral. lighter and vice versa right a lighter position can be actually kind of tokenized and live on Ethereum as well right so for example like that's not possible today that's I mean I think that the tech for that is almost is almost there I mean the one remaining piece is the ZKVM sidecar which you know like we've been working on that for for some time we're actually we're going to

have some announcements around that in the coming weeks some of those ideas have actually been inspired by some of what Taruna's written about six months ago, and other folks we've been talking to in the Ethereum ecosystem. But essentially what that will allow us to do, right, is like right now we have these custom circuits that can do order management, risk management, you know, liquidity management very efficiently. But you can't, like right now, you can just write a smart contract and have that run on lighter. Like you have to implement everything as circuits.

But with the sidecar, you would be able to do that. And so then those smart contracts will be, will share the sequencer with kind of the lighter exchange itself. And so that'll open up a lot of things like universal cross margin, like tokenization of lighter positions and, and so on. Like I think some of the. So should I imagine that is like that's a substrate on which lighter is going to be shipping new features that allow you to compose things with your core lighter positions, etc. or this is like a developer platform a la Hyper EVM that's meant to attract a broader set of developers. Like how should I think about the lighter VM? Yeah.

Well, some of it, yeah, I mean, some of it will be, there's some features that our team will implement that, that, you know, we have thought about for a while already. Like, for example, yeah, like tokenizing lighter positions or even like tokenizing LLP, right, that can live, like you can actually just buy shixtap. shares of LLP on Ethereum. So things like that will probably build directly. But yeah, other developers like, you know, Layer Zero, you know, Morpho, Avey, like, you know, all these protocols can live on top of lighter once the sidecar is done.

And we've talked to some of these teams already about doing that. So, for example, like in implementing something like basis trading, right? like that that's not necessarily um you know straight up tokenize a basis trade within lighter so that's that's you know to make that that work though you need some form of lending as well right and we we probably like you know they're already very established lending uh you know protocols on top of ethereum it's like kind of makes a lot more sense from our perspective for those to to to live on lighter as opposed to like us building you know lighter lend or whatever right that makes sense yeah one

thing I actually think is interesting about these RWA perps. So Vlad mentioned the euro is quite liquid on hyperliquid or sorry, on lighter is there's more volume. There's significantly more volume of the FX perps than like the history of the euro stable coins. If you go look, if you compare, like, and it sort of makes me wonder if like people are just going to trade perps of FX and then only use USD. So like they want exposure of euro. They'll just do a basis trade of holding spot stables and long or short the perp because it's actually some of these RWAs are funny because the ones that everyone thinks will be the highest volume seem to never be right like Tesla everyone I feel like Tesla has been this meme in crypto or for like the last five years everyone who's like

stocks on the blockchain would just be like they're Korean people who want to buy Tesla like I feel like I've heard that pitch five million times since 2020 I don't know if you see you've you've gotten that also. Yes, the cajillion times. But then you look at the actual volumes on hyperliquid and lighter. It's like Nvidia is crushing it or the index.

Like I didn't think people wanted to trade the index on chain, right? Like it's sort of like, so I like really enjoy watching the RWA perps because like the leaderboards can show me things I never would have expected to see on chain. No, I mean, I think it'll be interesting once you have for some of these

assets, like once you have the perps and the spot kind of on one platform, you know, to your point about kind of FX basis trade, but also even with, you know, we're, we're, we're talking to the Robin Hood team about kind of tokenized stocks, right? I mean, there's, I mean, there's some interesting stuff there as well, right? With, you know, spot versus herbs, but also for, for, imagine like for fixed income, right? Like, we haven't, that, that's not an area that has been. toward that much yet on chain, but like you can do some, like imagine that you can have like a

yield curve on chain and at the same time like trading the the perps too, right? Like so like I think there's a lot of interesting stuff. And yeah, I don't, it's hard to say right now like which ones will get traction, which ones won't. But I think once you have the spot and the perps that could change because at least like in trot file like a lot of training shops like their whole strategy only makes sense in the context of the basis trade. So I totally hear you guys on that.

At the same time, I also don't want to be Pollyanna-ish, which is that, you know, whether it's the RWAs that are being traded on trade XYZ or whether it's like the, the, the, uh, the, uh, the, uh, that's happening right now and lighter, right now, all this stuff is pre TG, right? Trade XYZ hasn't launched a token. Obviously, Lighter hasn't launched a token. And we've all been in crypto long enough to know that there's some distortion, there's like some gravitational force that's exerted by token coming.

And so one of the, one of the questions I have for you, Vlad, is once token comes, token's coming, you know, you can check the polymarkets to decide what date you think the token's coming, but token's coming. Once token comes, one thing that we have seen from every, every token in the history of anything, is that the behavior, T-G-E, T-minus-1 versus T-plus-1 changes. What are you expecting? What are you preparing for? And, like, how are you thinking about the before and after for Lighter has a token? Yeah, I mean, we're certainly going to continue to build and roll out new features and the will I think there'll be a lot of interesting functionality that the native token will unlock right but but yeah I mean just from like an expectation setting standpoint like it's the old cliches like it's a marathon not a sprint I mean like I think we we like I think the team and you know the early community is is is not a sprint I mean like I think we we we like I think the team and you know the early community is is

not necessarily expecting something that will be like a rocket ship on day one, but we'll kind of start in a healthy place and then and then kind of trend upwards from there if we continue building products that the community likes. I mean, I guess like the goal obviously isn't just like to maximize value on day one, but to have something that's healthy relative to the current state of the market and continue iterating from there. because it's not like I think we've seen a lot of you know we've seen some tokens that right that they have this like spike and then don't do well and then others that continue kind of a steady grind right which is i mean i think we've we've had a very um strong growth cycle like the last

few months but at the end of the day like we're we're in this for the long haul right like we're we're we're here like there's a lot of technology to build here there's a lot of innovation. And yeah, I think sometimes people might get excited about certain parts of the product for the right reason or the wrong reason, but some of it may have to do with, like, we're trying to, for example, like some of what we're doing now, right, is like, if we see egregious examples of like points farming, which are basically like civil attacks, like we, that's not, that's not some chatter on the timeline of you guys just slashing people who are just friendly. Yeah, exactly. Exactly.

Yeah. Yeah, exactly. So there's stuff like that that happens, right? But, and then, you know, there's anything from that to, like, real traders who may be trading a bit more aggressively than they would otherwise, like. But then there is, I think, across the space, there is a lot of real innovation happening. And there will be for the years to come. And, you know, we want to be part of it. I mean, it's clearly there's a big market.

One last question on this front as well is, like, I think the last time we spoke, must have been in the summer. you told me that your North Star metric is not volume, it's not open interest, it's TVL. Is that still true? Yeah, that is still true. Actually, I think that the events of October 10th were pretty good validator of that because there was a lot of noise around open interest and volume across a few platforms. whereas I think TVL was actually like pretty pretty steady. So yeah, because I think at then it was a TVL is a metric that represents like capital that, you know, customers.

It's a real opportunity cost. Yeah, yeah. Yeah. It's funny because we were talking about this with the L1 debate. And I, you know, we've like over the years invented so many new metrics for L1 ones. Like, oh, there's REV and there's, oh, there's, you know, the Metcalfeuf. law and there's all this other stuff. But the first metric we ever had for their ones was

TVL. And it has turned out, I think in retrospect, to actually be the most robust metric. But like, in the short term, you can game it, but in the long run, it's like really hard to have billions of dollars in TVL. It's just really hard. You can't will. Also in perpetuals exchanges, the TVL is mainly stable. So it's much, it's

even, it has less of the cycling. Well, not anymore. Not anymore. Not with cross-margining coming to a perfect change near you. Sorry, yeah, I guess. should add that. Yeah, I guess even, right, like we, now that we have ETH, I think, like,

2% of our TVL is now in ETH, but yeah, I mean, it's interesting because when I first got into the space, because TVL isn't really thing in Tratify, right? So, like, when I first got into space, I was like, to your point about new metrics, like this is kind of a new metric for me, but it took some time getting used to, but now I actually

really see the value in how we're it is. Yeah. It is very much that like 70 IQ, 140 IQ meme, I think is TDL. I feel like it's aged very well. Okay. So one more kind of meta story that I wanted to get into that relates somewhat to this discussion on tokens is there's been a lot of drama lately about the dichotomy between tokens and equity and what happens, particularly in the case of M&A. So there was a story earlier today that Axelar got acquired by Circle And when I say Axelor got acquired by Circle, of course AxelR is a decentralized bridging network protocol thing, you know, cross-chain message passing. And it was not the token that got acquired, but rather the Devco that got acquired by Circle. It was basically structured as an aqua-hire kind of thing where Circle took this thing and basically like, yeah, the token, you know, go have fun.

The token immediately went down something like 15%. I should know we're investors in Axelar. Turner, are you guys investors in Axelar? Yeah. You are. Okay, yeah. So we're all investors in Axelar, so we all had to. tokens go down. I don't know if you guys already sold, but we certainly did not. So we had a fun

little day today. And then, of course, there was another story a few weeks ago about TensorFlow, which, of course, was one of the large, they created vector. Fun as well, you know, they were originally a big NFT exchange on Solana. And they got acquired by Coinbase. And interestingly, when that happened, the token, although like the same story, acquired the Devco, did not acquire, the token itself. In that case, the token went up. Whereas when Axel required by Circle, the token went down, so maybe like Circle

is not as bullish as Coinbase as an acquirer. I'm not really sure what that means. And then separately to all this, there was a third drama around AVE. And basically, AVE, so of course, AVE has the protocol. Avey, as everybody knows, has a big token. It's a big lending protocol. There's also Avey Labs,

or Avara, which is the company like the Devco that actually employs all the people and owns the IP. And Avarra was, actually, I forget what the specific story was, but they were basically collecting fees off of something that was happening via the front end. Do you remember what this was? Cow swap. Cow swap.

Cow swap. So basically one of the, one of the functionalities on the front end is that you can swap. And basically, originally the fees were going to the protocol, but now those fees are getting swept into Avarra, the company, much akin to what was happening in the early days with Uniswap. Uniswop Labs versus Uniswap the Protocol. So all these three stories, kind of loosely related, but they all triggered a broader conversation

about what should be the right relationship between tokens and equity. We talked about this at some length, actually when Uniswap did their unification where they united both the Dow as well as Uniswap Labs and stopped charging a separate fee on Labs versus the Dow. But the weird case here,

I think with Avey, it's actually relatively straightforward, maybe, I don't know, we could talk about that. But I think in the case of M&A of Devcos, that does feel like also actually a pretty different situation than a sort of, you know, labs double dipping with respect to getting paid something that maybe should be owed by the token holders. So that's the backdrop for this conversation. We've had a lot of people going back and forth about it. Tarun, what's your take on this whole drama between tokens versus equity, M&A, how does

all fit together? The M&A thing actually reminds me a lot of like what's happening in AI where like someone will buy the management team and then dump the rest of the company like you know what happened in character AI or adept or any of these companies. But in those no but in those they did pay a big fee to the company. They just didn't acquire the company. Yeah. Yeah. Yeah. So the shareholders still got to pay out.

Yeah, I guess that's true. Although. Yeah, it's true. I don't think the payout is uniform. I don't know if it's uniform, but if you literally just like acquire the people and paid a bunch of money, there would be shareholder lawsuits.

The fact that it's not M&A, that was mostly a workaround for like Lena Kahn and all this M&A kind of scrutiny, but investors were still getting paid. I think that's a different story. Actually, that's a good point. There's no there's no like token holder lawsuit rights, which I think maybe that's like the real problem.

I'm like yeah yeah uh because like actually I kind of I when I saw this I was just thinking about this AI think because it's like oh it seems like hiring the dev co is a little bit like hiring the manager like some subset of the company but because like the foundation might exist and have employees right which is like the rest of the ecosystem I I think the tensor one seem I don't I don't know it seemed fine because like isn't the product kind of like this kind of sun setting or kind of the trailing off, whereas like Axler, I feel like it's a little bit weirder because in theory, the network has a lot more assets secured by it.

You know, like there's like AUM. I don't know what happens. What are the rights to that if it turns out like the validators? Well, so they handed off the. Oh, yeah, yeah. They have a foundation, right? Yeah, there's a foundation that's still capitalized. And that foundation is now being shepherded by another organization.

What's it called? Common prefix, right? Common prefix, right? Common prefix. Yeah, yeah. You know common prefix? Yeah. Do you know them? Okay.

Yeah. So common prefix is now taking over. It's a dev shop that's worked on multiple different chains and so. Maybe this is now their business is like taking over zombie chains and just running them. Well, they were trying to launch this like non-chain chain, right? Pod or whatever. Oh, is that right? Or pods.

Yeah, yeah. But common prefix is actually a bunch of like, you know, academics who work in consensus quite deeply. I think their name is one of the best names in crypto, but it is a very nerdy name. It looked like a very impressive team, but it did, it was like this like, oh, it all clicked moment where I'm like, okay, there are like, you know, one of the things people complain about with FTX and the FTX bankruptcy is like all these like bankruptcy vultures who just like show up and charge insane fees. And I'm like, why wouldn't there be something like that for crypto? Is that like, you know, okay, we say the chains can't go bankrupt, but like the people certainly, they're like, yeah, fuck, you know, fuck this amount. And in which case, shouldn't there be somebody who's like, yeah, I'm going to. charge you an arm and a leg, I'm going to take over your stupid foundation, I'm going to pay myself all the money in there, and I'm going to manage your stupid chain, and I'm like one of the only people who can do it. Not to say that Axler is stupid, but like I prefer the perspective of this

because the devs beat the lawyers. I'm sure it's a better system. I'm sure it's a better system, but like, to be clear, I don't know common prefix. I just got, I just learned it in the first time and I'm going to chat with them soon. But it would make sense that that exists. Like there ought to be something like that, just given the way the crypto works, right? Like, if it exists for companies, why shouldn't it exist for protocols? Because the normal thing is that it just goes into disrepair, right? It's just like, it's basically in the junkyard of old dino chains that nobody even knows how to start up anymore. Like, there's just some validator in some cloud somewhere that's still running and it, like, if anyone needs to fix it, it's like, oh, you know, fuck that. That one's just going to get

killed by a quantum computer. No one's ever going to go bother to go update that thing, you know? Like, look, I think you're right, there is something to this like Vulture. Crypto has not had many Vulture M&A advocate type investors and I know a bunch of people who are starting funds right now

for doing this type of stuff of like token holder advocacy and maybe maybe no no but I think there's a version of the world where you're talking about the people who made money off the FTCS state imagine I'm a fund that's doing token holder advocacy but I'm actually just trying to buy the try to get my company

whether my dev shop to be the one that's, so I use my phone to buy. Okay, so now we're introducing conflicts of interest and like self-dealing into the whole, okay, great. Perfect. But I kind of think that's, I kind of think that's what's going to happen. That seems like that's the way. I can see. Okay, so I do have a theory on this, but I'll, Vlad, I want to bring you in. What's your perspective on this whole shareholder, token holder drama?

Yeah, I mean, I haven't been following the specific cases. I guess we've been pretty heads down, as you guys can imagine. but I guess one thing I'll say is I feel like I mean again I don't know the motivations for these specific deals but like like I feel like there's a lot of untangling going on now from like like you know I think the last kind of kind of under the the regulatory environment in the past there was a lot of kind of like I think what someone called like centralization theatrics right of like kind of setting things up for And not necessarily, but not like running a chain and like the way that's just like most efficient for its users, but like just having all these different entities. So I don't know, but my guess is that maybe some of this is some of this stuff is like meant to like untangle some of those structures. But yeah, I mean, I think from like from our perspective, you know, it is like I think we do want kind of one, you know, everyone who's involved, whether you're your team members. or an investor or, you know, an early community member, like you're kind of all in the same boat and have allocation from the same pie.

Like, I think having when incentives, and that to me, like, that's part of like the magical things about crypto is like that the opportunity to do incentive alignment. Once you lose that, then, yeah, I mean, you get into, you might get into some unhealthy outcomes. but yeah, I mean, I have wondered about what happens to these zombie chains. That part, that's maybe a separate point here. I'm curious what might happen there. But anyway. Yeah.

No, I completely agree. And this is the drum that I've been paying for a while is that, like, you should have one asset and you should not have their, you know, some smearing of value across two different assets, two different sets of investors, et cetera. This was the criticism that I levied against Uniswap for a long, long time on the show, as well as in other venues. And I think this is largely what's being echoed by a lot of people who are criticizing these deals.

Now, we're investors in Axelar. And so actually, I want to clarify that despite the little story I just gave about, oh, maybe there are these Vulture firms. I actually think what happened here is totally fine. So I think, like Mike Dutas, as well as a few other people, were like, oh, my God, this is terrible.

You know, Circle's a bad actor. They're, like, cajoling people and taking these horrible deals. Look, you know, Axelar, I think it's a great team. Their tokens down, like, 85% or something from where we invested. Like normally when a startup is down 85%, like, it's time to call it quits. You know, it's like basically, hey, didn't work. We didn't build the

thing. We didn't succeed. And you like go, you're not enslaved by your VCs or by the people who've brought you together and to say, well, we have to just keep running this forever until we hit all time high again. At a certain point, you just say like, hey, it's time to cut our losses because we're talented people and there are more useful things that we could be doing with our lives than just slaving away in the startup minds. And as an investor, it's kind of your job to be mindful of like the human capital that is actually embodied in a startup and that is best released when the startup is not working. Like obviously you try it for a while and you might have to pivot and you might have to, you know, there are times that you have to go through the dark

night of the soul in order to get to the promised land. It happens. But there are times. it's like, hey, this market didn't materialize. We thought interoperability was going to be huge. It's not huge. You guys built Axelar. It's great. Market doesn't think Axelar is that valuable. That's okay.

It's totally okay for that to happen. Now, if you're a retail investor, retail investors don't think that way, right? Retail investors are like, how dare you? You created a token. You lost me money. You better, you know, like, keep working on this until I'm finally back in the money.

Otherwise, I'll hound you until the end of your days. And that's part of the reason why people historically take venture capital instead of retail capital because they know that venture capital is okay with the idea that, hey, you gave it your best shot and didn't work. It's okay. You can move on. So when Axelar got acquired a circle, so I should also clarify, I don't know all the details of exactly how this was structured and that. I know the high level of what we are getting in this outcome. But from my perspective, like, it's fine. I think the Axelar guys are talented. They should go work on something important, circles building important stuff.

And if the markets thinks that Axelar is not that valuable, and basically there's not that much more to do on Axelar besides just keep it running, then, you know, so be it. Good game, fair played. You guys put multiple years of your lives into this. That's all that an investor can ask for. So from my perspective, I don't think,

and if your circle, you are under no obligation. I mean, this is really Mike Dudus's points. I'm kind of sub-tweeting Mike Dudus right now. You are under no obligation to pay token holders for anything. they're not buying a token. They're aqua hiring a team. This is basically an aquaire.

So if you're aqua hiring a devco, and the devco makes no money, the devco is just like a corporate shell. So if you're acquiring a devco, you don't owe anybody anything. You don't owe token holder something. You don't owe the investors a big outcome. You don't know anything.

If the people who own the equity in that thing, which if it's all safe, then the only equity holders are the founders, if they agree to the deal, it's a deal. And like, token holders don't get a say in that vote. Now, I do think that there is a good, argument to be made that that is perhaps a flaw in the system. And to your point to ruin

of like, hey, you know, why don't, you know, token holder lawsuits is basically why would a token holder lawsuit make sense? The answer is because maybe token holders should have a claim on governance of the Devco. And I imagine that maybe there's a way that you can build that in, that perhaps there's like a protocol level rofer in the Devco docs, that if somebody goes in and tries to do a change of control of the Devco, that the docs are written such that, like, the Devco has to go and run a competitive process with the protocol and say, like, hey, these people want to acquire us, but as a protocol, as a Dow, you have the right of first refusal. You can buy us back if, like, somebody is convinced there's a better use for this Devco talent than their protocol.

But my guess is that, you know, would the Axelar protocol pay up for the Axelar team? One thing that we've learned from these DAOs that they hate paying for talent. I think probably one of the worst parts of Dow governance that we've seen is that they're just so cheap. Dow's are so incredibly cheap. They hate paying above market salaries

or even market salaries. They abhor market salaries. And every single individual line item is overwhelmingly picked apart and criticized. Where if you look at a corporate board or you look at VC governance, we don't do that. That's stupid.

It's a really terrible way. to retain talent and to incentivize a team. And so I don't know. Curious, Deroon, what's your take on this concept space of letting DOWs play a part in the Devco retention? It seems inevitable. It'll happen. I mean, I feel like you've just created five jobs for players

who are listening to the show who are going to, like, open class action lawsuits tomorrow or something. Well, you can't, I mean, you can't. No. I don't think you could, I don't think you have standing to, if you were trying. I think that would be it would be such a stretch.

You can make life horrible for the dev code. You can be annoying, yeah, but like you have to pay lawyer. I don't think anyone's going to take that on contingency. That's such a stupid lawsuit. Having been party to something.

Maybe I'm wrong. Maybe I'm going to eat my words. Maybe we have accepted this idea now into people's heads. Berwick law is going to wake up and suddenly like to have laser eyes and be like, boom. Do you own?

I mean, let us know. Hasib, you and I both are party verbal. I guess I was party in the Lido thing, which... Yeah. I don't...

I think there's lots of lawsuits that exist in the world that might be frivolous, but take seven years to adjudicate it. Totally. Totally. Yeah, but also it was a different regulatory regime at that time. So there was more sympathetic... There was more sympathetic judges. There was, you know, if you went through motion to dismiss today on a lot of those lawsuits,

I think they would have succeeded today, whereas they failed at the time that they were actually initially adjudicated. So yeah. Anyway, we're up on time. Vlad, thank you for joining us. What should people look out for if they want to see what's happening with Lighter TGE coming up soon? Give us some alpha.

Just follow us. Lighter, XYZ. You know, we'll keep everybody up to date on the next two weeks. There'll be some, a lot of announcements. Okay. And lighter points, prediction for lighter points? For their value? Yeah, yeah.

I mean, I think the market, you know, it's starting to trend up a little bit again. So we'll see if it hits 100 pretty soon here. Okay. Is that the prophecy, 100? I think we'll see some trades at 100. But yeah, I guess those points markets are, although that's been kind of an interesting thing to watch throughout this process. But yeah, we're pretty much just staying heads down.

And there's so much to do it. I mean, so, yeah, definitely, thanks for having me, guys. Thanks for coming. Well, next Tarun paper is going to be on points markets. Dude, I think after this time, I think it's the first time I've ever felt like I need to. Have they beaten it out of you? Have the H.L boys beaten it out of it? you? I just think it's not just that. It's just like no, like, I feel like there's no value for

this type of thing. It's like, you might just go do the name. You can't end the show like, no, you can't just be like, uh, it's, it's true. Is this beginning of your expert witness art? It's just kind of like, all right, if you're just going to be kind of, all right, I have a little bit. We've got to end the show on something positive. Tell me something positive. I don't know if I have anything for you. So you force it, force it. Anything. Justin's on $100 million in LOP. There you go. There you go.

His Excellency. All right. Good note. Time done. All right. Thanks, guys. We'll be back. We'll be back.

Yeah, thanks.