Unchained - The Chopping Block: Token Launch Hype, L1 Wars & Prediction Market Breakouts - Ep. 969

Episode Date: December 4, 2025

Welcome to The Chopping Block — where Haseeb Qureshi, Tom Schmidt, Tarun Chitra, and Robert Leshner cover crypto’s biggest moments. This week we’re joined by Kevin from the Monad Foundation as we dig into the most chaotic token launch of the year. Monad goes live, CT explodes, and the tokenomics wars come roaring back — vesting, float, FDV, and why everything “just keeps going down.” We break down whether the world actually needs another L1, how hype creates impossible expectations, and how Kevin and the Monad team are handling the spotlight — and the hate. Then we shift to security chaos: Yearn’s underflow hack, Anthropic’s AI discovering real smart contract vulnerabilities, and “post-quantum” panic sweeping Crypto Twitter. Plus: BTC volatility, MicroStrategy drama, and prediction markets suddenly going mainstream. Show highlights 🔹 Monad’s explosive token launch — hype, backlash, and why it became CT’s main character of the week. 🔹 Kevin joins to break down the launch mechanics, the expectations, and what the team actually prepared for. 🔹 “Low float, high FDV” returns — why vesting debates reignited and why tokens keep sliding despite higher floats. 🔹 Do we really need another L1? The crew dissects infrastructure fatigue, tribalism, and what counts as real differentiation. 🔹 Why hype almost guarantees disappointment — and why early sentiment rarely predicts long-term outcomes. 🔹 Handling the hate — Kevin explains how the team reframes attention, survives the noise, and stays focused post-launch. 🔹 Yearn Sonic exploit — a simple underflow bug hits an OG DeFi protocol, reigniting security concerns. 🔹 AI finds zero-days — Anthropic’s agents discover new smart-contract vulnerabilities and spark an AI security arms race. 🔹 Quantum panic — why “post-quantum” became CT’s latest engagement meta and what it actually means for chains. 🔹 Macro shakeups — BTC volatility, MicroStrategy flirting with NAV, and equities demolishing crypto returns. 🔹 Prediction markets breakout — Polymarket’s US launch, Kalshi’s mega raise, and Robinhood bringing event contracts in-house. 🔹 Long-tail opportunity — why prediction markets may extend far beyond politics and sports to everything people care about. Hosts: ⭐️Haseeb Qureshi, Managing Partner at Dragonfly ⭐️Robert Leshner, CEO & Co-founder of Superstate ⭐️Tom Schmidt, General Partner at Dragonfly  Guest ⭐️ Kevin McCordic, Director of Growth at Monad Foundation ⁠Disclosures⁠ Timestamps 00:00 Intro 01:21 Monad: Hype, Hate & Week-One Reality 06:08 Vesting, Float & the “Low Float, High FDV” Meta 17:27 Do We Need Another L1?  25:08 Public Perception, Expectations & Narrative Cycles 35:54 Yearn’s yETH Exploit & Anthropic’s Exploit Agents  44:06 MSTR at NAV & Equities Leaving Crypto Behind 48:06 Polymarket vs. Kalshi vs. Robinhood Learn more about your ad choices. Visit megaphone.fm/adchoices

The vast majority of crypto projects fail or die because nobody cares. We're still in the low flow meta. There are no simple solutions for why tokens keep fucking going down. Your friends are getting hilariously rich, punching quantum meme stocks, and you know, you're stuck flat in Bitcoin. If it's just another copycat, there is no value at all in a journey. Crypto Twitter is so mad at everything right now that Satoshi could launch Bitcoin and everyone would hate it.

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.E.T is the ultimate problem. DFIPITs are the antidote to this problem. Hello, everybody. Welcome to the chopping block.

Every couple weeks before we get together and give the industry insider's respective on the crypto topics of the day. So quick intro is first you got Tom, the Defy Maven and Master of Memes. Hello, everyone. Next, we've got Robert, the Cryptoconisour and Tsar of Superstade. Good Winter's Eve. Yes. In Hat today, we decided to represent in Hat.

because it's winter and maybe the last live show that we'll be doing for the year. Joining us today, we've got special guest, Kevin, shit poster specialist at the Monad Foundation. I like that. First time I'm hearing that. Welcome, welcome. And I'm a Steve of the Head Hype Man at Dragonfly.

We're early-stained investors in crypto, but I want to caveat that nothing we say here is investment advice, legal advice, or even life advice, leasy chopin-blocked at X, Y, Z for more disclosures. So we wanted to bring you here because Monat has been the talk of the town. It launched its token last week.

Last week? Yeah, I guess last week. Congratulations on the token launch. Probably one of the most hated token launches I have seen in the last year. Just the sheer amount of argument elicited from people who are not either short or long, just to have something to say is probably the highest density I have seen in quite a while. And that being said, you guys are also one of the most hyped projects over the last year. And one of the things that I've noticed as a phenomenon in crypto is that the more hyped you are,

pre-TGE, almost always that means that the hammer is going to come down one way or another with respect to the difficulty of living up to those super high expectations. So how do you feel like or how do the people at Monad feel like the launch went given how long you guys have been working on this thing? Yeah, I thought, I mean, the only thing I was thinking about for two months prior was just every single thing that could go horribly wrong and any of the risks involved. So from that perspective, I think everything went very smoothly, right? The chain launched, there's no hiccups, 100% uptime.

and so everything is functioning as intended, which is great. On the hate side, yeah, my, I know something is like the only thing that people are tagging me in on Twitter when my mom text me about it. Your mom is texting me about it. She has like an alt account. Oh, wow. And she was like, how are you? What's the handle? It's at mom.

Is she a milady? It's fun. No, no, no. All right. Everybody follow mom. Yeah. Docs to your mom. That's a-

That's fine. It's in a non-handle. Tough move. Not a non anymore. Yeah. But she. you text me and was like, how are you dealing with all this? Like, are you seeing this? Like, what's coming on? Like, yeah, are you seeing like 200 notifications a minute? Wow. But yeah, I think it's

generally in crypto. I mean, one of my goals are the things that I have tried to do with Monad is make sure that people have an opinion. Like, good or bad, it kind of nets out. Just make sure there is attention because people had opinions. Yeah, the vast majority of crypto projects fail or die because nobody cares. So like as long as people care, it's not good. Now it's much better if people care and they love it. That's preferred. But caring at all is definitely important. I also think that when a lot of people care about one thing in crypto, the popular thing to do is be cynical about it. I think there's actually a lot of healthy skepticism in crypto, right? You know, everyone here has been around for a while. Generally, if you heard,

about a new project, like the right natural response is like, that's probably not real or a scam. And maybe an easy mental model to take for this is like, if your mom texted you, it was like, hey, I heard about this crypto. Do you think it's good? You'd be like, don't touch it. It's definitely bad. Like, everyone has that natural instinct. So the burden of proof is on the team and on the project to like show that it is a good

thing. I think in this case it's just been a massive, very public wave. But like, give me the, you know, give me the proof. So synthesize it for anyone who's not up to date with it. What would you say based on this massive wave of conversation, like the top three complaints are? Yeah. I think that there's one that's just like an emotional response. And this takes the form of just like pure spew of hate.

And I think the reason for that is like crypto, crypto is a lot of similarities. with religion and just like anything that is not your religion tends to like insight this emotional response that's negative. I think that there are criticisms of like the main one is like why do we need another L1 which is super fair. That's probably the most longstanding question that I've gotten. And it's like the correct question I think for anyone who like if you know a little bit about Monad, the correct question asks is, why do we need another L1? Yeah, so I think if I had to kind of reduce it down to what the most common criticisms were, I would say probably number one is, okay, this is just a way for VCs to dump on retail.

And obviously, we should caveat the show with that I think all of us are investors in Monad. So we are some of the VCs about which people are complaining. So complaint number one, VCs dumping, which obviously is not happening yet because no other visas are unlocked. The complaint number two is, why do we need more L1s? isn't there too much infra? You guys should have launched years ago. Like, kind of too little too late.

We already have all this stuff. Like, these problems are all solved now. Okay. And I actually think it'd be really interesting because it triggered a lot of hate, but also a lot of, I thought, really actually meaningful engagement and conversation. So one of the big debates that this triggered

was actually Kyle Simani, friend of the show. He came out and said that the big mistake that he sees over and over again from token launches, I think might not probably be in the triggering event for this conversation, is that you should make a small, that all tokens are unlocked day one. So one of the, one of the phenomena that we see with token launches is that normally what happens is there's a one year cliff before one years, none of the

insiders, the team, the investors, the advisors, none of them get unlocked. And so all at once, generally, after a year, a wave of those tokens unlock, and then they unlock continuously over the next call it three to four years. That's the most common way the token launches are done. And so his argument was that, well, Salana didn't do it that way. What Salana did is I think they had like a nine-month cliff, and then everything unlocked all at once in nine months. And his argument is that actually even that was stupid, we should have done everything unlocked day one, like complete float, total free for all. The price is the price.

Yeah, the price is the price and let markets discover their true point. If the VCs are going to dump, let them dump immediately, get it out of the way, and like, let's just find, you know, real fair value. Fair value. Right. And so I came out very strongly against this, but I want to get a sense of what is your gut reaction to that debate about the mechanism that we have today, the principal criticism of it, is that it doesn't allow true price discovery because the supply is going to massively inflate

when all those tokens come online and it can be like a two-xing, a three-xing, a four-xing of the float as usually not four-xing, but more like two-xing. I mean, I feel like for the last four to five years or so, and I think SBF sort of mastered this originally with this low-float, high-end, FDV game. The meta for the last four to five years has been low float high FDV, where projects release as little of the float as they can initially. And it starts trading on a percent, 2%, maybe 5 percent of the FDV. And there's a delay and you show the price based on this tiny flow for as long as possible and then things unlock and everybody can sell at hopefully a high price.

That's been the meta that almost every team in project is used. Well, that's definitely not, that's definitely not typical. There have been many successful ones. No, no, no, no. One to three percent is extremely low. That is nowhere near where the market averages. One or three percent was like World Coin. World Coin was like 2 percent, I think.

Yeah. And that was egregiously low. But let's just say 5 percent in a lot of cases. In your case on the SBF side of low flow high. I feel like that's the coin that people think of like that's low flow. Yeah, serum was an example of that, right? But like that, like more typically, because I wrote this big article last year

where I analyzed the floats that were coming out both, I think, on Binance last year, as well as historical floats for Solana, near Avalanche, like the previous generation of companies, and even things like, you know, Swap and Zero X and all this stuff. And what you find is that historical averages are around like 11, 12%.

That's still extremely small. 11, 12% of 100%. Yeah, do you know what the typical is for an IPO? Yeah, it's like 10%. Yeah, it's a, it's a, it's, It's about the same. I know, but it means that there's going to be 9x the amount of supply in the future, 10x, right? Yes.

That is still a low float game, right? We are still in the low float meta. And I think maybe it's bouncing between two ends of a pendulum and they're both wrong, right? I think there's problems with both. There's problems with everything being unlocked at day zero, right? There's problems with, and you pointed this, like that was the ICO wave in 2017. Right. It was like, ha ha, TGE, like everybody.

including the founders and the team is 100% out today, they walk away from the project, right? Clearly there are wrongs from everything is unlocked. There is no vesting. There's clearly also problems with everything is locked. You know, the market is trading a tiny piece of this for a long time. Both ends of this pendulum seem bad and broken. Sure. The correct answer is likely in the middle. Yeah, I think it also comes back to the fact that like token launchers are done so much earlier in the life cycle of a project compared to an actual IPO. And so therefore, I think Yoshi do need constraints. Like there's path dependency to the success of like the project, right?

You know, one one team that does, has like a terrible, you know, token launch and the token trades sideways are down for years might actually be structurally set up worse to perform and to build a better product than someone who has, you know, perpetually higher token price that gives them a worse test, that gives them menten the project that gives like excitement for it. And so there is like kind of this weird token price management component, which kind of sucks, but it is kind of true. But I don't know, I think it's kind of naive to say that like, oh, if we just had everything

on lock day one, everyone performed the exact same with the exact same incentives when I'm like, clearly that's not true. That's never been the case. And then comparing it to an IPO is just like not, it's not analogous in many ways. Yeah. One other aspect, I think that has come into play. Like when people think of 2021, it very much is like low flow, high FTV meta for better, worse is just burned into everyone's brain of like that was a 2021 cycle SPF running wild minimal floats

there is an aspect of just being able to do token launches in a different way now or like monad was the first ever token sale on coinbase which was great working with them was awesome to my knowledge was the broadest distribution for like known participants not just counting wallets from the iCO it is which is a great way to launch a token right you have a very decentralized holder base early on. How many participants was it? There was just over 85,000. 85,000.

KYC on Coinbase, which is like this tough KYC. Right. Which is a great way to launch a token. And it's also a safer way from a project's point of view to get 7.5% of the float was sold. And then, you know, roughly three and a half-ish percent was airdropped. But I think like for the last four years, it was kind of like, how does float get out there day one?

It's like you kind of just have to air drop it. And now everyone has this learned behavior of like the second I get anything on AirDrop, just sell it to zero. And then it's just like it's been difficult structurally. Yeah. I think. And so token sales via exchanges to get more float out there, I think is like a healthy progression of just like how tokens get into the market to start a chain.

I mean, that is a better way. Because, you know, previously when ICOs were basically verboten, if you wanted to increase the float, that basically meant, okay, do it. air drop. And doing a bigger air drop, of course, as we've learned, has become less and less efficient at actually doing anything useful. So you're kind of just burning tokens in order to maybe solve a market structure problem that like, you know, how much is this actually a solution to that problem? TBD. The other thing, of course, is like, you know, what's the other side of tokens? Tocons with no locks? The answer is meme coins. And, okay, you go see a meme coin.

Everything's unlocked. Everything's trading immediately. Is there all that much evidence that like, okay, these things trade better or more stably or there's better price discovery or whatever. It's not really clear, but then also if you look at previous generations of tokens, right, so just go look back at yearn or look back at stuff that is fully distributed, right? If it's true that high, FTV, low float

is the primary cause of this last batch of tokens going poorly, then what you should see is dispersion. What you should see is that tokens that are mainly unlocked are doing better than tokens that are more recent that have this high, FTV low float mechanic. And you do not see that. you do not see they're like, oh, yeah, yearn and compound, which are fully distributed, are doing really well relative to insert, you know, DFI project from this vintage.

You say, actually, no, they're all moving together, and there really is no clear regressor you can run that says, ah, this explains why things are going poorly. So that was my principal critique of the low-fTV high-float story, is that these tokens have basically always been, quote-unquote low-float high-fTV if you consider low-float to be like 12%. 12% is the historical average. It was a historical average in 2018 and it's a historical average in 2024. 2035, I don't know, I didn't run the numbers,

but I wrote this article in 2024. So I don't think the story is that simple. If it were, it would have a really simple solution. But there are no simple solutions for why tokens keep fucking going down. So my argument is that, like, no, I don't, I think vesting is good. I think this is not something that we should not remove. I do think there are ways that we can improve it at the margin.

I do think that the main way that you can improve it at the margin is with token sales, right? If you do a token sale, then one, it's a non-wasteful way of getting more float out there. So you get more float out there immediately. You can actually make sure that's going to real users

by doing some kind of deduplication slash civil resistance. And by getting those tokens out to real users, you get cash instead of just airdropping it to random people, right? And then with that cash, you can make the protocol better or, you know, in some ways

even do some kind of market stabilization. Now, TBD, whether or not that's legally advisable, but I have to imagine that norms around this are going to evolve in some way. My guess is that at some point, what happens is people find ways to get more creative about how to use very, very large token sales.

So maybe let's say you sell, you know, not 7%, but let's say like 15% of the token supply. And with that amount of cash, if it's a really big project that has a, you know, anomaly high FTV, you use that cash in some way that's not, okay, we're like in the market as a dealer just going out and buying back a token, but there's some kind of programmatic way

in which this is a stabilizing pool of capital for the token markets, right? That's not discretionary. I can imagine that that becomes a new norm in the market that both increases float, but also doesn't say, okay, I have this giant pile of money, but I'm not going to just burn it

in a gigantic fat treasury that I just give out token grants and stuff that don't end up going anywhere. Because that is the other failure mode that we saw from previous cycles when projects would raise huge sums of money and the ROI, when you get into the hundreds of millions,

just plummets on your ability to actually drive meaningful outcomes. But here's the counter argument, right? If you are a mature project that is about to launch a blockchain or an application or it's fully built, right? Yeah. Raising the capital at the end of the process, when it is fully built, there are a lot fewer use cases for that capital besides your point being a dealer, market maker, whatever, buying back tokens later. Like, the capital is less useful at the end when it's ready for launch versus at the beginning when there's a of building and hiring and like development. I don't know that that's true.

Yeah, it's kind of true, but like, you know, it's not like these foundations or these labs, like they launch the blockchain and they walk away, right? There's still a lot of work to be done. And even you look at something like un-swap, right? It's like many different versions have been built out and probably more, you know, capital spent post, you know, token launch than pre. But I think to Kevin's point, too, it's also about, you know, you need float. The question is, do you just give the token away to a bunch of people who are probably

sibling you anyway and there's going to dump it immediately or do you like have some better method of distribution and it feels like a sales like a better way to do that even if you don't care about generating any money like even if we're like you know you to i don't know draw some blood to like this token that would tell people a better way than you know just getting out of ear that's like world coin yeah yeah yeah you know go in the arm okay blood so i have a sample blood coin who's building sam gives you tokens okay i like that i like that um okay so the one side of this is should all tokens be unlocked immediately and should tokens invest the other core criticism of Monad is why do we need another fucking L1?

We already have so much block space. Ethereum's cheap, right? Vitalik was just posting like, oh, just come build on L1, you know, the fees are like one cent to do a swap or whatever. So there is a real question of like, okay, hey, maybe at the time that you guys started building Monad, which was, I believe, 2022,

when Monad was first founded. Okay, maybe in 2022 there was an argument about why we needed this blockchain, but you idiots were way too late, you ship this thing three years late, and now we solved all the problems. Why do we need you? So this criticism was probably the most common thing that I saw. And I wrote this big long article and we ended reading it out, or I ended reading it out on

the chopping block on Sunday of kind of critiquing this cynicism that people feel increasingly about, not just about, okay, do we need new infra, but also is any of this infra valuable at all? Is Ethereum valuable? Is Salana valuable? And of course, if you, if the answer to that is no, then obviously the answer to Monnet is going to be no. But so curious how you guys saw that whole zeitgeist playing out. I mean, I think as a society in general, there's always room for more experimentation and development of L1s. As long as you're trying something different or you're iterating on the structure of

an L1 in some way. If it's the 37th EVML2 of Ethereum, it is not valuable at all compared to the 36th, the 35th, whatever, right? If there's genuine differentiation, then it's, I think, valuable because it's something that society can learn from, developers can learn from, users can learn from. It, like, extends the, like, social knowledge, right? There's value there. If it's just another copycat, there is no value at all in its shouldn't exist. That's my personal belief. Yeah.

I think people acknowledge that Monad's not a copycat. You know, so like Arthur Hayes came out and he was just, I think first he was like, oh, Monad, $10, Monad's going to rip. And then it went down and he was like, fuck Monad, his VC trash. Yeah, short this thing to zero. And Keone wrote this very heartfelt post of like, oh, well, actually, Mr. Hayes, we have all this great technology that may I interest you in. And he described all the different innovations.

And I think Arthur's response was something like, Look, I've heard from people that you guys are good guys and that you built some real tech, but like, yeah, you know, who cares? Look, no one needs it. Even if I don't care if you built good tech. Nobody needs this. And this is the same kind of down-only VC trash that is just going to die on the vine. And so, yeah, even if it is differentiated, even if it is different, even if they did really improve the mousetrap, well, we don't need better mousetraps. The mousetraps attach mice.

Yeah, I mean, I feel like this happens with every tech cycle and then, okay, there's some new use case that actually does take advantage. I mean, people, I feel like also, like, how many perp-dex was there before hyperliquid? And now how many, it's, I think it's, I think it's such a, like, a facile argument. I think also, like, let's the thing about the moment I hand to you where like, I feel like you guys actually did everything. And like people still hated you for it. We're normally like, okay, you didn't air drop me enough tokens. Okay, actually like a very cool air drop ceremony. It's like, do you didn't do the sale?

The sale was like very extractive. Okay, it was like, you had this big sale. And it's like, and then you actually built the tech. And like, there's so many other like random bullshit projects from the past three years that you see people promoting. on Twitter. And if I feel like you guys like, you know, it's like the squeaky clean kid and like the back of the class that like it's done everything right. But people still fucking, you know, beat you up in the, you know, in the playground anyway. So I don't know. It's just like, it's very funny. I'm like, how can you, how can you hate this child? Yeah. Yeah, I think,

I mean, going back to like people kind of having their clans and that's like where they claim and they, like, I'm a Patriots fan when we play the Giants. Like, I don't actually have any opinion of the players. But it's like, oh, we're playing the Giants. Like, I hate those guys. I think a very similar thing happens with crypto, except there's also like a financial component to it, where people own an asset and anything that could potentially challenge that is an enemy or a foe. I actually think that's a very small part of it. I think there was some of like, okay, the Heath Tribalists and the Solo Tribalists,

some of them were coming out, but it was much bigger than that, right? Yeah, there have been other L-1s that have launched in the past couple years that, like, don't get as much like tribal beef, right? in my... Here's what I'd say. Here's what I'd say. Is that like, what I saw most interestingly about Monat is that people who normally never talk about anything like this had opinions about Monad, right? And the thing that's interesting is that everybody has this intuition that there's too many L-1s,

there's too much block space, fees our way down. So like, this is a non-problem that you guys are trying to solve. And it's... The most common criticism is that it's extractive that you guys are almost like duping the market or playing to the markets. weakness or folly that, oh, okay, you know that markets like L1s. So you guys are creating this L1 to extract from the market and to like fool the market into giving you a valuation that you guys can then dump on.

So it's almost like it's it's a very different kind of mental model than just, oh, you're bad because you're shitting on Ethereum, right? What's interesting is that if you think about like the really big success stories in the L1 space, they all actually had a very similar. reaction, right? Ethereum got the Bitcoin people so angry. Yes. Right? Like, irrationally angry.

People who would never touch it. Like, they don't care. They would never use Ethereum. But just the idea that Ethereum existed, it's like, oh, this shit coin that you ICO, like, why didn't you just fork Bitcoin? Why didn't you building this on Bitcoin? They were so angry about it. And the second one that got a very similar reaction was Solana, right?

Where it's like, like, why are you building? This is not decentralized. This is, you know, fucking, this is you guys are, you guys are, you guys are, you guys are, liars, you're manipulating people into buying your fucking whatever, like it's not open source, blah, blah, blah, all this stuff. And so, now, that's not to say that because people are mad, it's not that you're going to do well. But it is a sign that people being mad is not very indicative of anything in particular, except that you are, you are very close to the bloodstream. I think that's what it indicates more than anything. Like, L1s on some level, like they are

obviously the most core thing in crypto. Like, it's the whole ballgame is blockchains. And so building a new blockchain, it's like somebody who goes in trying to build a new Bitcoin. You know, if anybody, like, it's kind of laughable today. If somebody were to come to a VC in pitch, I'm going to build the next Bitcoin. You just can't be like, you're joking, right? Like, that's not a serious pitch. I would actually love to hear a pitch like that, you know, in 202026.

Yeah. But like people used to pitch that. Like, I remember getting pitches like that. All the time. In 18, 17. Yeah. Oh, how many better bit coins were there? Totally, totally.

Right, but like today it would be funny to get that pitch, right? There's like literally a joke. But making that pitch about Ethereum, about Solana, about whatever, it's threatening because it's, one can imagine it could actually happen. It's hard. It's extremely hard. But I think like most of the really big outcomes in venture, they have that kind of reaction, right? They like, it's so implausible that it makes you angry.

You know, you never get angry about something that's like just stupid. You know, if somebody says like, oh, I'm building next Bitcoin, you know, no one's going to get angry about that. Like, Bitcoiners aren't going to start writing these long threads of I can't believe this person would compare themselves to Bitcoin. No, they wouldn't even notice it unless it got big, right? Right. It would have to have this like survivor biased even like enter people's radar. Yeah. It would be dismissed categorically. Right.

Like, and not worth conversation. Right. But I have to imagine for you guys, like, it must be demoralizing to some degree to go from being probably like the highest favorable ratings. in crypto Twitter to now being like public enemy number one in the span of like two weeks. Yeah, I mean, I'm getting text from my mom. How upset are you? She's like, should I reply? I'm like, never tweet ever.

Don't touch the time. So what are you telling your team? How are you telling your team to navigate this? Yeah, I think one reframing that has been helpful is that like they're actually giving energy instead of like hate. And so maybe like we, part of my team, we, view attention as a more kind of absolute value. So like if somebody hates you, it's actually,

it's not a negative. It's actually worth more than them not caring whatsoever. And so framing it like that helps take the sting off a little bit. Like maybe it's not worth the same as positive endorsement. Right. But it does spark conversation. And so I think leaning into that has been helpful. Spoken like a true shit poster.

Yeah. I mean, like look, like I think about, you know, probably a lot of people who watch this show know like choose Rick. choose rich Nick right he's love that guy dude yeah he gets an insane amount of views it most people who don't know what he's doing is hate and then everyone who like kind of knows his bit is like oh this guy's actually great at what he's doing

but he's getting more engagement on crypto Twitter than like anyone else essentially and so that even though these comments are very negative he is creating a brand I think he likened it in a recent podcast I think uh Laura Shin's podcast actually to Barstool. He's like Portnoy does the same thing. There's as many people that hate Dave Portnoy as love them.

And that's like part of the entire amassing of energy. And so to me, the most important thing, like, it is really hard to understand what Monat is on the tech side. Like it is very, it is a very technical project. So the best chance you have to get people to know that they should build on it is to just get generalized energy and attention. And then when it's centered around Mana, like, hopefully they actually look into what it is.

And I think that that has actually worked quite well for a number of years. Yeah, like could do without like the personal insults of people saying like. What's the first personal insult you've seen? That rubbed you the wrongest way. There are there are like very long streams of DMs. I'm trying to think maybe how about this. I'll go with like the one thing that has made my day in the last few days on Sunday. It was just like after Arthur Aza posts and it was basically just like crypto Twitter erupted.

It was like every single person had an opinion on monad. And I put out a tweet like it's if it feels to me like everyone is just rooting or like hoping that monad is a scam. They like want this to be a scam so bad. Like why? Yeah. And it's like clearly, you know, we've Keone and team have spent four years at this point. There's been an insane amount of effort. Like we've tried to Tom's point.

And we tried literally everything to try to be squeaky clean and like do the public sale, do the air drop, like make sure that those boxes are checked. But it doesn't like it didn't actually end up changing the result much, which is funny. Like at the time when we were doing this, we thought it might. But yeah, I don't know. So yeah, sorry, back to the. What made your day? Well, made my day. Don Alt, like, how do I was like, why does it feel like everyone wants Monnet to be a scam so bad?

And Donald replied with a couple actual, like, good answers. And then he's like, listen, crypto Twitter is so mad at everything right now that Satoshi could launch Bitcoin and everyone would hate it. It was like genuinely like you could launch the best thing in the world, but people are just angry. And I think it's part of the way that the cycle has gone. Like all coins have generally gotten crushed relative to Bitcoin. and like even Ethereum has been kind of crushed for a lot of the cycle. People have been trading meme coins and just be like losing money. Like the little guys who spend time to try to learn what to do in crypto besides just buy

Bitcoin have generally done very poorly and they're just angry. And so it's much easier to just not care and just say, I hate this thing. And then like when you see other people doing it too, there's also torque to it. You just buy into the mob mentality. Totally. Well, they hate money right now. Yeah, it's great. Yeah, I should hate on my head.

I think you're buying into the Mon mentality. Yeah, yeah. But yeah, I don't know. I think there's a lot of different explanations. It's like, why do we need another Al-Wan? There's like an emotional answer to that for that. Like the reason that they're asking might be emotional. There's an actual answer to it.

There's, it's pretty complex. But at least it's happening around Monad and not around some other project. Yeah. I mean, look, at the end of the day, like the week one of a launch of any chance, is almost always a nothing burger. That was true for Ethereum. It was true for Solana. It was true for the move chains.

Base, the only thing that happened in the first week was there was a bald token. And besides that, there was nothing going on. Like, what are you going to get done in one week? The answer is very little. It takes time for an ecosystem to develop and actually be able to prove itself. So the question of, is Monad bullshit?

Is Monad going to succeed? Is it going to do well? Does not get answered in the first week? There's so little data. And like, yeah, people are going to come around. They're going to play around the chain. They're going to use a couple of the apps. They're going to buy a couple meme coins.

But the ability for you to retain founders, teams, TVL, activity, all that stuff is yet to be proven. So the question of, should you be bearish on Monad, you don't know enough to know yet. Give it time. Let the data come out and let the team do what teams do. Yeah, you know this. Everyone already knows this. But the echo chamber loses its focus and finds a new shiny object to hate or to discuss or to love very quickly.

Yeah. And I think, you know, for better or for worse, the energy around moda is actually going to dissipate as people get enraged by the next thing. Yeah, that's true. I mean, so, you know, Eigenlair, they recently put out this post-mortem talking about why resaking underperformed as a narrative, let's say. Like, obviously, they were extremely high expectations and they were like, look, why do we feel like we under-delivered on this story?

Why have there been so few AVSs? Why have there been so few success stories about the core narrative that we were telling? And I think, you know, if I think of Monad, EigenLair is probably the closest example. I can think of this kind of rise and fall of narrative momentum.

And the reality is that I cannot think of a single project that had that degree of hype that successfully delivered on that degree of hype, right? Almost always when you have that amount of hype pre-launch, you are not going to be able to live up to it because Crypt-Tritter can just imagine arbitrary amounts of goodness and air drops and money-making and, you know, the token just going up into the right infinitely.

And that kind of irrational exuberance almost always is a setup for a disappointment because nobody can deliver on that in one week. How on earth could you? How could you tell? Like, oh, mine had finally launched. And guess what? Everyone was right. It's worth $20 billion.

It's worth $50 billion. We figured it all out. TVL went vertical. Yeah, TVL went to $5 billion. What would people do with $5 billion on Monday on day one? obviously nothing. It takes time for that ecosystem to develop. So I guess my point is that the rise and follow those early expectations, like all those people who are, who have an opinion, but an asset that they don't own, they're not even short, they're just, they just have an opinion

because it's cool to have an opinion about Monad. All those people are not going to be paying attention to you in three weeks. And your audience is going to be the people who actually do care. People who actually are interested in their ones. People actually are interested in, hey, should I move to a new chain? should I be buying something on ad? Should I be using this for my defectivity? And those are the people who actually matter, who are actually winnable, at the end of the day,

if you don't care one way or another, you're just like saying something to have an opinion, then you're not in the audience. You're not even relevant to the audience. And so I think the game will feel different when that smokescreen clears, right? In the same way, like for Eigen Layer, everybody had an opinion on Eigen Layer.

For most people today, I don't think they even remember that they had an opinion about Egan Layer. I do. Yeah. I still love Eganlier. I also think, you know, the expectations were extremely high. My own expectations were up here.

Yeah. It's sort of sad that they didn't capture the value of that narrative like they could have. Right. I mean, we're investors in Aikenlayer. And I think, like, you know, obviously everybody had sky high expectations. When that was happening, I was telling everybody at Dragonfly, I think people are in for disappointment because the expectations around so many of these pre-TG projects is just people are kind of pricing for absolute success

and like immediate out of the gates, like everything's going to go great. And almost nothing happens that way. Yeah. Almost nothing happens that way. Very few of the startups that you think of as successful look like that. Salonah didn't look like that.

Coinbase didn't look like that. Like none of these projects looked like that. All of them had long incubation periods where they were figuring it out, doing the work, getting the thing to actually be in a state that it could scale, and then eventually scaling it. Right. Most of them were quietly chugging along without much attention, even if they were trying

to gain visibility attention before their success. Right. Right. So all that is to say, you know, if we had to say, if I had to send a message to the Monad team, which obviously, you know, I don't know if they care what I'd have to say, but my message would be chill. Like the game starts now. Not last week.

You know, whether or not you win the likes on crypto Twitter is not the game. The game starts now. It's for the next year, the next two years, the next three years is the actual game. Enter the Monad Monastery. There you go. I like that. I like that. 100%.

Yeah, I mean, that's very much been the team mentality. I mean, through this week, even though four months leading up to launch, every single all-team meeting, just hammered in like, this is the starting line, right? It's probably not going to look the same as however you're picturing it. Some things will be accurate. There are some unknown unknowns. We'll figure it out just like we have a good plan. We spent a long time building a ship.

Like we're dropping in the water. It's going to be shaky. And then it starts. So very excited to see what, you know, the next few months look like in the Monad ecosystem. Right. I'm excited to support new builders who hopefully we captured their attention. And now they learned about Mona because they heard all the hate and in our interest in deploying.

Yeah. Yeah. Well, so that is kind of all on the bullish side of infrastructure. There's also been some stories this week that are maybe bearish. on the side of infrastructure. So one of them was we had another defy hack this week, which was Yern, super OG project. And Yern, there was some rounding, was it a rounding bug?

Yeah, yeah, yeah, actually, do you know what happened? I actually did not. Was it was also only on the Sonic deployment, I believe. It was not on like all the urine. It was like a sub pool within YERN. Yeah, it was like a sub, it was like a small product called Y-Eth. It was exploited by some kind of, some kind of rounding bug

when depositing very tiny amounts. There was, oh, no, there was an underflow bug. I'm sorry, it was an underflow bug. They stole $9 million. It wasn't an enormous sum by DFI standards, but obviously still bad to see an OG defyy protocol like Yern to have a vulnerability. This exploit, I think it was the next day

that another story that was seemingly connected along the same thread, this time by Anthropic, the creator of Claude. So Anthropic announced that they were working on using frontier models in agentic systems to try to exploit, smart contracts programmatically. And so they've introduced a new benchmark that they are now testing their own,

their own agents on as well as GPT5 on, to see whether or not it can hack smart contracts using a data set of known smart contract hacks. So initially, I think previously when they were testing on this, they got 2% of all the smart contracts that they were able to exploit. They are now at 55% efficacy of being able to hack the smart contracts in their data set. Now, of course, these are known hacks, so there may be some data contamination, possibly, you know, you can imagine they trained on some blog post that described how the hack was done. So can you know for certain that this is really a clean readout of their ability to hack in the wild? And so in order to test that, they also tested on new exploits that were discovered after their training data.

And they found that they were able to discover some exploits that were on, you know, they were discovered after that date, as well as two zero days. a zero day is a exploit that is the first impression anytime anyone has ever seen this exploit. They discovered two new exploits in the wild that their bot found that no human has ever found. Now, unfortunately, or thankfully, these exploits were worth about $3,000 each. So they were very small amounts of money that were exploitable. They did do a white hat hack of one of these contracts in partnership with Seal in order to save the $3,000. So thankfully nobody had their money stolen from them. but it's a sign that the times they are changing.

And, of course, one way you can think about this is like, oh, my God, attackers could be using these models in order to do some of these exploits. Like some people were speculating that, oh, maybe the urn attack was done by this exploit. We talked before about the balancer hack, maybe having some signs of having been vibe-coded. Right. But, of course, the other side of that is that perhaps defenders can also use these models to, you know, programmatically scan for vulnerabilities and find the vulnerabilities that attackers might otherwise find.

themselves, and maybe they have more resources to be able to spend on this than attackers do. So thoughts on the incoming AI smart contract apocalypse? I actually take issue with this story. I was reading the blog post. I think this is just an intern, frankly, puffing up their accomplishments. Because if you actually read through the exploits in the actual anthropic post, I would not call these exploits. Like the one that they really highlight, it's this like, you know, basically like a token,

platform, you can, you know, send in money and it admits a token. And there was a pancake swap pool for that same token that was trading at like 10x the ICO price. And so they're like, oh, there's an arbitrage here. So I'm going to mint a bunch of these tokens for cheap and then sell them into the pancake slot pool. I'm like, arbitrage versus a lot of fact. It's not because it was an unchecked method, right?

It wasn't supposed to be callable after the ice. No, no, there's re-entency because you can like mint a million tokens in one transaction recursively. But then the amount that's being stolen is from the pancake swap pool. So it's like a pancake swap pool is just mispriced. Okay. I'm like, that's not an exploit. Agreed.

Or these other ones is like, oh, they didn't set their affiliate parameter when they, I'm like, it's not a zero day. Zero day in my mind is like, you know, Massad is like listening on your phone. This is like, oh, someone deployed a meme coin and they didn't set the affiliate. So I'm like, look, it's cool. It's very cool. But I'm just like, I, you know, it's not quite what I was imagining when I think of like AI, AI hacking. Yeah, I mean, it's not cool. It's not that useful yet, but like all AI started with, it's not that useful.

It's not that cool to get to the point where we're at today, right? Like if you trendline this one out in a year to two years, software will be better at writing secure code and finding vulnerabilities than humans. Like objectively, it's almost there. It will definitively be better than the best humans. And that is going to be a weird inflection point where the security posture of every single team, writing smart contracts and lower level code is going to have to change. Yeah. Like you are going to be forced to adopt software first development.

Yeah, I agree with that. I do think it's maybe like a little embarrassing too that many of the exploits that are being like found now, even after the training cutoff, it's like they're like the source of the vulnerability is like from a known. I'm like, like, it's just like, oh, you already know this is an issue. I mean, it's like people were still doing like, reintersy bugs in like 2025. It's like, what the fuck are you doing?

A lot of the defy hacks in the days of your king from known types of vulnerability. The teams did not patch their own code or they were alerted that like there's a new vulnerability and they said like, oh, it doesn't apply to us. We looked at our code. I think it's bad for the team, though. Like, it's embarrassing.

It's like, I mean, look, this urine hack was an underflow. Yeah, right? And then like these things are like, the balancer hack was a rounding error. So like, we're still getting hit with the basics. Yeah. Right? This is not rocket, oh, somebody found some EVM, you know, memory corruption thing.

Like, it's all just kind of brick and mortar. Yeah, you're supposed to round. You fucked up the rounding, dude. Yeah. Right. It does feel like on the one to two year time horizon, though. It's almost like the same kind of quantum risk people have talked about for Bitcoin for a long time. This is like the slow takeoff version of that.

They're like, the AI is going to get good enough. And then it can hack smart contracts. So you're saying that AIs will use quantum computers to hack. Just like everyone's like The quantum risk, I think overnight quantum is going to get cracked And then what's the fastest way to pull value if you crack quantum? Like take Bitcoin This is just like a slower version of like the computer's going to get better and better at hacking

And eventually like or the story at least is a balancer was just hacked and now you're in like the OGD5 protocols are now cracking Imagine what happens with GPD7 right But it feels like going to have new protocols written a year to two years from now that are written AI first that are not crackable. It's a quantum resistance. Yeah. It's like one to one. Where you get on AI these days, like quantum finds away into that conversation.

I've noticed this more and more. This is definitely a trend. Quantum analogous security. I heard recently, that's the way you get engagement on X.com these days is you have to talk about quantum and Nikita boost your posts. Oh, is that right? I've never tweeted the word quantum. Do it after the show?

Yeah. Just see how we keep talking. Let's pop the quantum cherry. Lie. Yeah. Yeah. Yeah. Okay.

Wow. You guys keep talking. What are you going to tweet? What are you going to tweet? Let's, let's collectively compose this. One word. AI, defy. I was going to say quantum is overrower.

The quantum is over, no, we just say quantum solves AI. I think that's what. Quantum. Quantum solves AI. I think that's the tweet. All right.

All right. Once we, once we finish and I'm going to retweet. You're going to get like a Naval re-tweet. Something. Yeah. Yeah, I love it. That's so wise.

It's so wise. This is going to be my lamest tweet of all time. No, no, no, dude, this is going to go viral. Certified banger. This is like not certified bang. This is definitely, it's going to... Certified lame. Let's continue.

Okay. Okay, all right. All right, let's move on. We've embarrassed ourselves enough. So on the public market side, public markets have been very volatile. Markets were dumping yesterday. Now, of a sudden, they're undumping. So it looks like Vanguard seemingly has saved us.

So Vanguard announced recently that after hands, aiding crypto and constantly talking shit about how crypto is uninvestable or I should say not suitable as an investment for the Vanguard August platform. They recently changed their mind and said, okay, fine, we're going to allow people to buy crypto ETFs. So a big reversal. And then I think this morning, basically when U.S. markets opened, we saw a big pump. And Bitcoin, it was languishing around like 83, 84, refound, like, I think it's like 92

now. Yeah. And then like everything pumped like a good 10%. yesterday micro strategy, now known a strategy, was also languishing. It finally definitively for the first time went below 1XMNAV. Sorry, not for not for the first time. They obviously were before in the bear market. Last week on the show we talked how it was flirting.

It was flirting with one X. And of course, they've been below 1X in the past in the bear market post the FTX crash. But they definitively were below one. And they did this recapitalization where they raised, I think, like 1.4 billion in cash. And they announced, we may, if, if necessary, sell some of the Bitcoin, which caused markets to vomit. And so now they've reclaimed the 1X. MNAT, at least as of today.

But things are, to say the least, jittery. Now, the story about, like, why markets have been so weak is macro. Kind of. But then the macro story is kind of like, well, actually, now the rate cut is priced back in. And so I don't even know if we can blame macro at this point. Like, how are you guys reading this market and just kind of the woes that seem to be besetting everything in crypto?

I'm not a macro guy. So let's ask, yeah, one guy. I don't know if I'm smooth-braining it, but like, micro-strategy to me was a way to get exposure to Bitcoin. Like, that's kind of the origin of the micro-strategy trade. And then since then it's kind of turned into like proxy for Bitcoin, but it's levered. It's on the way up, like it's higher beta. I don't know. If you pair it and squint with the vanguard side and ETFs, it's kind of just like there's just actual good ways to get exposure to

Bitcoin now that isn't like some guy who tweets. But wasn't that true as of last January? Right. I'm just saying like on a, like if you look at it on kind of like a two, three year time horizon, like ETFs coming in, Vanguard opening it up, like Bank of America embracing and Microstratory compressing isn't like maybe there's not a causation there, but like the two of them are correlated. I don't know.

I preface with that. I might be smooth. I just think like there's now there's an easy way to. get access to Bitcoin. There wasn't, I don't know. I do think some of the, like, bitterness that is just kind of permeating around crypto Twitter right now is because, like, equities actually actually had a killer year and crypto's been flat. And gold. And gold. And it's like, yo, what the fuck? What about us? And I think, you know, your friends are getting hilariously rich, punting quantum meme stocks and, you know, you're stuck flat in Bitcoin. And I don't know,

I think I'm sure that actually does affect people's, people's psyche and I get mad at Monad. I mean, if you're flat in Bitcoin, you're doing great relative to everyone else. Yeah. Yeah. It's hard to do. Yeah. I think that's definitely true is that it's like, hey, I was supposed to have made the debasement trade of the year. I was right that like, you know, regulations are going to come off and Trump is going to embrace it.

Gocto president. Government's going to buy Bitcoin and all this stuff. And somehow like all my boring boomer friends made money this year and I'm down. We're now below where we were 12 months ago. Yeah. Yeah. Yeah. Yeah.

November was the big rally. November was a big rally. Yeah. So that's a bummer. That's a real bummer. Yeah, it doesn't feel great. Yeah. Hence, people are bashing on Monad.

We'll tell you. Is that it? Is that it? Is that it? Is that simple? No, but let's just pretend like it. Well, here's the one thing that people are not bashing is prediction markets. Yes.

And before we started talking about the news and prediction markets, like why? What's up prediction markets? The first question is like, why do people, people feel so differently about prediction markets? It's actually not obviously, I think that maybe the answer is because there's no tokens yet. I mean, I guess there's like tiny little tokens. Agreed. So there's nothing to buy yet.

There's nothing to sell yet. There's nothing you know that you made money on or lost money on. And there's nobody else getting rich who you can identify. Right now it's purely a skill-based game. What do you mean? If you are trading on Kalshi or Polly Market or the startup ones, right? you are making or losing money as a user of a prediction market, not as an owner of a prediction market.

The owners of the prediction markets are doing extremely well, right? Valuations are going straight vertical. Yeah. You raised to $11 billion today, right? But as a user, if you've lost money based on prediction markets, it is your own fault because you predicted one, right? To your point, there are no tokens. Yeah, I don't think that's the, so like, you know, people are mostly happy for

call she raising a new round. Yes. Polymarket raising a new round. Yes. All these valuations being super high. People are like, yeah, great. This is all wonderful, and I'm very happy that I'm seeing this.

Yeah, they're introducing new tools for society. Right. That are fun and interesting and valuable, and it's in net good. Yeah. But not mine.

I'm not just total extraction. Just total extraction. Anyway, was very good. No. You want to speak for the extraction. Yeah, explain why you're extracting so much. There are currently prediction markets.

on it, I suggest people go and try them out. You can filter on Aftamon at X, Y, Z for prediction markets. All right. There's my plug. Prediction markets are great, right? It's just really hard to dislike them. Are they good? Are they good?

That's bad. That's not great. Give me a shot. I think that, yeah, I think that they're going to be really good. But on the plug market, it's like, I think the key thing, and again, maybe smooth brain take, but like, they're so easy to understand that onboarding and user acquisition is actually really simple. It's like easier than sports betting. The first time you ever did a sports bet, you're like plus 165, like I don't really understand that you kind of have to

learn them out. This is just like, oh, if it wins, this is worth $1. Yeah. And it's like so easy and based around big events, like big events have the most trading volume. So it's like, it's kind of a positive flywheel that comes with that of more people care by this thing. So there's more liquidity, more people trade it. Yeah, that is a really good point. that, like, I've been in the gambling world for so long. It never really occurred to me what an incredibly unintuitive U.S. sports betting is. Oh, it's horrible.

Of, like, just looking at the odds. It's a little bit like, you know. Negative 2.10. I'm like, I don't know. Yeah, yeah, yeah. Like, it's common knowledge is, like, margin trading versus perps. Like, perps are just so much simpler than margin trading. Like, in theory, they're the same.

They're, well, not the same, but, like, they're not that different. But the U.X is just so much more intuitive, which just leads to one product growing massively relative to the other. And so it's, you know, even if you're just doing sports betting, like just the way you quote the odds just actually solve so many of the problems or so many of the U.S. issues with sports bet. But let's put that aside. So some of the news that's been happening in the prediction markets world recently.

So one, of course, a polymarket in which we are investors, recently did their U.S. launch, hit number one in the app store for sports, seems to be going very well, at least in the first week. And Shane was recently featured on 60 Minutes, the very famous American. show on CBS, I think it is. And Colchie, not to be outdone, recently announced it raised a round at a $10 billion valuation. They raised a billion dollars led by, I think it was paradigm, A6 and Z, and Sequoia, all existing investors, as well as launching some of their tokenized contracts on Solana. And it's a little bit weird the way they're doing this, because of course,

Kulshi is US regulated, TFTC registered, you know, DCM, DCO platform. And Tom, you were explained to me, how exactly do these things work when they're launching them on Salana? Yeah, so the Jupiter integration has been live for a little bit now, maybe a few months. It's, I think, a little tongue in cheek to say that's like trading on CalChi. Because because functioning what you're doing is you're basically engaging in like a bilateral swap with Jupiter or deswap or DFLO or whoever's actually quoting on these police platforms. So you're putting money into a contract. They are as well. And they sort of agree to pay you out based on the resolution of the Cali contract.

But like, they're functioning your counterparty, not Cali. And then they're quoting you the price of these contracts based. on what Cali she is quoting at the time. So it's sort of like, you know, I can buy, imagine like a, you know, decentralized future of Bitcoin and then the person who's selling it to me is then hedging it out on the CME. And it's like, okay, I'm kind of in a roundabout way, you know, contributing to CMA liquidity.

You're getting kind of the on-screen pricing of buying a CME dated Bitcoin future. But like, it's actually all kind of self-contained within this contract. And like the CME is not actually the clearing venue for this thing. So it's kind of cute. I kind of think it's actually kind of a clever way to offer the product on chain, but they're functionally just very different. Like if there's a bug in the smart contract or I don't know, there's some issue with your counterparty, like that's your issue.

That's a Jupiter's issue. That's not Nalchi's issue. Right. So it's pure RFQ. You're just trading against some market maker who's willing to quote you any of the contracts. So it's not even Kalshi's product. No. Well, they're using Kalshi for resolution.

So the contracts, but they're the Jupiter's developing the contract. So it's sort of, again, it's like, how do you get the resolution? from Kalshi. I think they just read it on chain. I guess they are pulling the API or something. Colchie's just posting on chain. Hey, this.

Yeah, I mean, it's kind of like if you and I, you know, put money and do an escrow and we're like, okay, this is going to be our trade

for the resolution of a Kalshi contract. We can do that offline. Yeah, yeah. But Kalli's posting the Oracle. Yeah. Okay, got it. Yeah.

So that seems to be part of Kalshys' on chain strategy is using this RFQ type mechanism as opposed to actually trying to put an exchange on chain, whereas, you know, the actual exchange itself, the liquidity,

everything is on chain, and then they're launching their U.S. product, obviously, which is kind of segregated liquidity in the U.S. And then the other big news relevant to the whole meta is Robin Hood, of course, which is a large portion of Kulshi's overall volumes is coming through sports betting and prediction markets on Robin Hood. So Robin Hood's a distributor, and they're sharing some of the economics with Kalshi. Robin Hood announced that it's now building its own JV with Susquehanna, very large, well-known market maker and market participant, to build a CFTC licensed futures and derivatives exchange in clearinghouse, DCMDCO, SEF for prediction markets and for event contracts, meaning seemingly that they're going to now be internalizing

this and cutting out Kalshi. So we've seen from Robin Hood's quarterly reporting that this is one of their fastest growing verticals, at least on a percentage basis, not in absolute terms. So they see that this is working. This is a great business line. And seemingly they don't want to split the revenue with Kalshi, especially if they own the users and the users aren't, they don't have allegiance to Colchie, they have allegiance to Robin Hood. They're like, hey, we might as well own the rails ourselves. So how do you guys think about the meta of prediction markets as evolving, polymarket coming onshore, Colchie going on chain, and then Robin Hood potentially cutting out both? What do you think the future looks like for the space? I think Robin Hood is

one of the few firms that can internalize the product and everything that's required from the legal and regulatory side to the tech side. I don't think there's going to be many firms like Robin Hood. Robin Hood capable of doing it. And so I think what we're going to see is sort of an oligopoly between Robin Hood, which has distribution, it has a huge user base, plus its own internalized prediction markets. I think you're going to see firms like Coinbase that partner with one of the two. I think you're going to see others that partner with one two. I think what you're going to get in an end state is a couple of systems as backends for others, like Kalshian Polymarket. and you're going to see one or two attempts at internalization, Robin Hood.

I'm sure someone else will try it, probably less successful, right? I'm sure at some point I'm making this up. Vanguard, don't do it. Not Vanguard, obviously. But like someone like that is going to be like, oh, we're doing a prediction market. And I think you're going to see approaches that are vastly different, but all of them sort of succeed in their own way. I think the problem is going to be the startups,

and there's a lot of startups trying to build prediction markets that are not really going to have distribution or the ability to win distribution over Kalshi and Polymarket. I think we're going to see this sort of like first mover advantage. And I think there's going to be a lot of dead bodies of people to try to do something different. So where does the money get made, though? I mean, I think as always, it's on who owns distribution and has consumer loyalty. And so this case probably Robin Hood, in this example.

I think, and it's not really uncharted territory for them already. right? Like they already use forecast tax, which is CME's, I guess, DCM for some contracts. And so when you're already using it, they're already aggregating over existing event contract providers. I think, and then I'm guessing their joint venture will just be one of those and maybe one that will try to promote more. The thing that's kind of weird is like, okay, they also do this across other financial services and products they haven't written in Robiner today. You can get all sorts of options. You can get a spot. You can get a mortgage. But don't the one's offering it. You know, there's obviously sitting.

getting out through someone else. But with event contracts, like, they're not necessarily fungible. Like, me buying, you know, like a piece of stock is different than, okay, maybe these two different election contracts resolve slightly differently, or maybe they're like weird quirks about the way the contracts are structured. So that's like the one from forecast next is not the exact same as the one from Cali. It's not the exact same as this one from this JV. So I don't know how you kind of resolve that.

I think Cali, I would have to imagine, saw this coming. Like, it's not, you know, this classic like commoditize your compliment. kind of strategy. I'm guessing that's why they're trying to push so hard into crypto is like, oh shit, this like huge bulk of our volume is shrinking and trying to get rid of us. And so we are going to get in a lifeboat and try to get into crypto and try to get some crypto flow. And I'm guessing that's part of their thinking and doing this on-chain push. Yeah, I think it's, to me it's a story of distribution on both sides. Like you can imagine, I feel like it's a pretty simple answer of like, you can imagine Robin Hood sitting,

where I'm going like, all right, there's this enormously profitable new vertical everyone in the world is betting on this growing a ton. We own the distribution for it. Like, can we get more juice out of this lemon? Like, can we actually make more money on this? Sorry? The lemon. Pineapple.

Something tastier, I thought. Yeah, I don't know. I don't know. I don't want to drink lemon juice. They own all the distribution, this enormous vertical. And leadership is probably like, do this better. Like, we can win this outright. And this is just a strategic play for them.

Same thing with Kalshi, right? Like, it, the Kalshi side almost. reminds me of kind of tokenized stocks when that was a story maybe six months ago. It's like, why is this potentially valuable? Well, there's just more distribution, right? There's just access to, for a lot of folks that can now come and use the product. And if you're betting on crypto growing, like they're on Solana, Solana is awesome distribution, especially for retail.

There's probably a lot of overlap between people that trade meme coins on Solana and people who use prediction markets. And so that's their foray into distribution. Yeah. The one, and this is trying just to look really far out into the future and, like, seeing what wins and loses. Like, I think right now we're looking at competition over a somewhat overlapping series of events that are being speculating. Where it's, like, major sporting events and major political events, that's kind of the market right now. It's not a long tail.

It's like a fat body of, like, the most popular things. That is the battleground. I think what we're going to see is the market will evolve at some point. and the battleground will evolve to being like you have this like set of core type of events that are extremely popular. But I actually personally think the longer tail of all other things is actually a much bigger market that nobody is currently contesting and nobody is really fighting for right now. And there's so many things that go into this long tail. It's everything from, you know, speculating on weather events when there's a big flood coming, you know, it's everything like to like

a high school basketball game. It's like theoretically there's like 10 million. different events per day that people would want to speculate on if they could. If it was as easy as like talking into your phone being like, I think like this high school team is going to win, you know, and it's like anyone else in the like stands can be like, screw you. But like I think like the total number of events that people want to speculate on or bet on or like be engaged in or want to hedge is actually absurdly long. It's like constant. And I don't think anyone is fighting for tapping into this market at all yet. I don't think that. they have a way of really conceiving of it yet because most of the platforms are built for like

a couple big markets and the liquidity to aggregate in it. It's not built for a long tail. And that market, I think, is much larger. And I think someone new is going to crack that at some point. It could come from a college. It could come from a polymarket. I don't think it can come from a Robin Hood, frankly, because it's not like a full web interface, you know.

But I think like that is not being addressed at all. And it's quite large. Well, good little request for startup. Requests for startup. Yeah. Long tail prediction. Or AI. Permissionless prediction.

That's also big. Predict everything. Yeah. Yeah. I like that. Well, maybe a quantum AI will be able to predict everything. At the end of the show, I'm going to actually check to see if that is a certified banger. Right where we wrap.

Well, we're up on time. So maybe we should all check our phones and retweet your. What do you guys think? Certified banger or certified dud. I'm going to say, I'm going to say bangor right now. I'm going to say dud right now, but we're going to turn into a banger. With the show ads. What are we at?

What do we at? This is a extreme dud, probably my worst tweet of all time. Don't delete it. I'm going to retweet it. Four likes. Okay. I've never had a freak out only four likes in my entire life, 18 minutes in. This is the worst metrics I've ever seen.

A lot can change. A lot can change. You got four other. Day one. The token just launched. Give it time. Day one. There's a lesson here.

There's a lesson here. You have failed to learn it. Yeah. Writing by committee. is old. Okay, we're up on time, Kevin. How should we, what should people do to engage with Monad? Here's your plug.

Go for it. Yeah. Probably the easiest way is to go on Twitter, go to at Monad, M-O-N-A-D. The pin tweet has a very easy explainer. And just type how shitty it is and how terrible you think. Right, tweet, anything about Monad. Anything terrible. Usually negative.

At Monad, you suck. If you want. Tag intern and his mom. Tag app, Mom learns crypto, mention Monad and some hateful thing. You will definitely get more than four likes in 18 minutes. Hey. It will work, I promise. Let's go.

Excellent. Excellent. Love it. All right. That's it from us. Thanks, everybody. Be back next week.