ROUNDTABLE: Crypto's IPO Era | HYPE vs. SOL vs. PUMP | Jon & Bread

Crypto markets are buzzing and institutional appetite is peaking. With Circle’s IPO wildly oversubscribed and a new wave of companies racing to go public, we unpack what this means for the industry. Jon and Bread join us to break down the hype around crypto IPOs, why TradFi wants stablecoin exposure, and what it signals for projects like Solana, Ethereum, and Hyperliquid. We also debate value accrual, ETH vs BTC narratives, and whether apps or platforms will dominate the next phase of crypto. This is the IPO Era of crypto—let's dissect the winners and the delusions. ------ 📣SPOTIFY PREMIUM RSS FEED | USE CODE: SPOTIFY24 https://bankless.cc/spotify-premium ------ BANKLESS SPONSOR TOOLS: 🪙FRAX | SELF SUFFICIENT DeFi https://bankless.cc/Frax 🦄UNISWAP | SWAP ON UNICHAIN https://bankless.cc/unichain 🛞MANTLE | MODULAR LAYER 2 NETWORK https://bankless.cc/Mantle 🌐SELF | PROVE YOUR SELF https://bankless.cc/Self 🟠BINANCE | THE WORLDS #1 CRYPTO EXCHANGE https://bankless.cc/binance ------ TIMESTAMPS & RESOURCES 0:00 Intro 0:32 Vibe Check https://x.com/intern/status/1932238240880222270 https://x.com/blknoiz06/status/1932072994731647435 10:13 Crypto’s IPO Era https://www.tradingview.com/chart/?symbol=NYSE%3ACRCL https://x.com/HadickM/status/1931323504525279522 18:11 Ethereum Valuation Debate https://x.com/DeeZe/status/1932475461348835800 29:29 Hype vs SOL vs PUMP https://www.tradingview.com/chart/?symbol=KUCOIN%3AHYPEUSDT 40:44 Hyperliquid vs Centralized Exchanges https://dune.com/uwusanauwu/perps 50:35 PumpFun’s Token Sale 58:16 Closing & Disclaimers ------ Not financial or tax advice. See our investment disclosures here: https://www.bankless.com/disclosures⁠

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:03David Hoffman?

  Welcome Bankless Nation back to the roundtable. We're back in session today, the man with glutinous glutes, Zero X Bread Guy, good as you.

• 0:11Speaker 01

  Hey guys.

• 0:12David Hoffman?

  And today, at the top of Ethereum's most wanted list, John Charbonneau. Joe. And then, of course, the world's most zen DJ, Andy8052, he is out golfing, so it's just us two today. Bread, John, good to see you guys. We riffed it with Ryan Shun Adams last week, but it's good to have two of the boys back in session this week. I want to get this week started off with kind of just an overall vibe check. There's like a lot of activity, there's a lot of buzz, there's a lot of engagement going around in crypto. Animal spirit, yeah, animal spirits feel present right now in the crypto industry. There's two tweets that are kind of echoing around, one from Intern. "State of the crypto markets," they say, "ICO's are back, apps are generating revenue, crypto IPO

• 0:54David Hoffman?

  going parabolic, Bitcoin tapping all-time highs, stablecoin growth with no end in sight, and then Bitcoin accumulation vehicles popping off left and right." And then another tweet from Ansem saying, "Appetite for crypto exposure has never been higher, various entities alongside Taylor buying multi-billion of Bitcoin." Circle is a lot of the same thing. Circle IPO, 25 oversubscribed, 5X and Open, Plasma, $500 million ICO filled in two minutes, Play Market and X integration, and then also the United States government actively pursuing regulatory clarity. A lot of reasons to be bullish. I feel pretty bullish about the second half of this year. I feel like the second half of this year could get frothy, that's not my base case, but my base case is like at least a slow grind up. So I want to kind of get a sentiment check from you guys about what you

• 1:39David Hoffman?

  think the next, like, second half of this year will look like.

• 1:43Speaker 01

  Oh, that's tough. Like, you know, like, we've all seen the structural bullishness that was in place for this to happen, right? It went all the way back to like the ETF inflows, like, the loosened regulatory frameworks of like, just, hey, hey, like, there's appetite for this thing. So like, I think we've all loosely, like, thought directionally this would happen, but in a volatile Trump market, like, there's like, the path was never going to be a straight line up. I still don't think, like, it's not going to be just a Like, oh, we're just grinding from here. It's gonna be fine, guys. No, that like, something is gonna happen over the next six months that's gonna scare the bejesus out of us. But then we have to look back to stuff like this and go like, guys, we're fine. Like, there is, there is some fundamental structural stuff that like, is, is bullish for us and we need to stay aware of that.

• 2:25Speaker 01

  But yeah, like, this has always been kind of what we were hoping for. Just like, it will, it will pull up. It's just, it's not gonna be, it's just gonna be a slow grind. I'm, I'm confident of that.

• 2:35David Hoffman?

  So I'm hearing neither affirm nor deny.

• 2:38Speaker 01

  It'll go up.

• 2:38David Hoffman?

  Any bullishness.

• 2:40Speaker 01

  I'm holding my options. They're, my options are, they're expired at the end of the year. I think those are a good move. But yeah, man, I got, I know I'm gonna have to white knuckle probably for a few weeks between here and there.

• 2:49David Hoffman?

  Okay, so, so you're saying by the end of this year, we will be higher than we are today. And in addition to that, there will be one of those big tweets from that one Twitter account that says like, $500 billion has been liquidated from the crypto markets in the past like two hours. Like, one of those two.

• 3:03Speaker 01

  Of course.

• 3:04David Hoffman?

  Yeah.

• 3:04Speaker 01

  We always get out over our skis because we're feeling this, like, we're rattling off lists of like, guys, it's a new paradigm. And then like, that's when everyone's like, they long at the top. And then I, I just did it last week. I told like, I entered my first per position. I longed at the top and my, the ass fell out. So like, okay. Like, you know what? I gotta grab this thing for a little bit. Revisit these kind of lists and say like, guys, we're fine. Like, some of these things will carry out. And I think it's gonna be no different.

• 3:28David Hoffman?

  John, what do you think?

• 3:30Speaker 02

  I was listening to a podcast yesterday where they brought up super cycle.

• 3:33David Hoffman?

  Oh, no.

• 3:34Speaker 02

  More times than made me comfortable, which, which is more than zero.

• 3:39Speaker 02

  Yeah, I, I mean, I broadly agree. If this administration is good for anything, it is good for volatility. There is gonna be periods between now and the end of the year where we question everything, probably back down on the downside. I just wouldn't be surprised by that. But at the same time, the just broader setup for the space is really just great right now. Where, I mean, back, back on the just higher level of, I mean, where, where is the administration, where are politics? The environment is just so much more positive. Where, I mean, we saw in the past week, I mean, like, the, the SEC was having a bunch of the industry leaders come in and talk about the industry, like, they, they want to openly engage, you know? People were retuning the tweets of Paul Atkins.

• 4:15Speaker 01

  Do you think we're represented well in those, those instances where they pull people in to actually have conversations? Cause like, that's always been the question, right? It's like, you know, in the past, we've, we've had those conversations, but it was, you know, SBF. And it's like, ah, that's, that actually did more damage, right?

• 4:27David Hoffman?

  Right. I think we're represented incredibly well this time around.

• 4:31Speaker 01

  Yeah.

• 4:32Speaker 02

  I would say that we were represented very well. My partner at TPA was one of the speakers that they had at this event, Michael Jordan. So you're obligated to say.

• 4:38David Hoffman?

  So John says, yes, we are represented.

• 4:40Speaker 02

  I think we were represented incredibly well in Austin.

• 4:44Speaker 02

  But it really is just an amazing tone shift to see the SEC and other regulators that are very actively reaching out to us because they want to engage, they want to get this right. And we see that in the enforcement actions, the guidance that they're giving, where last year it was they were sending enforcement actions. And the past week, we are looking at the SEC tweeting out how DeFi fits in the American spirit, and we want to respect self custody for usual. That's still just a crazy shift for me to see in the past year. And on the legislative front, we're obviously seeing strong progress on the Genius Bill is moving forward for stable coins. We'll see where market structure bill goes after that. Hopefully that gets pushed forward. But very broadly, the macro setup is there. This is being accepted as a real asset class. The framework is being built for us to actually be able to mature the industry. So the onus is really on us to

• 5:27Speaker 02

  build the products that take advantage of, hey, you can go build mature real products now, like, please go do that. And I think that we are starting to see signs of that as well in the industry. And then you are seeing the institutional demand for the product as well, as evidenced by, we'll talk about this later, but the Circle IPO, which was the biggest left curve, mid curve between, you know, what was the right take on this IPO versus what was CT saying about it going in. And it's very fitting, too. I feel like I've seen a lot of tweets over the past few months or so, six months plus, where a lot of people that you talk to who speak to more institutional investors and people who are looking at crypto from the outside, larger money managers and the like, versus you compare their sentiment to what is CT sentiment, has just been the widest gap that you've

• 6:10Speaker 02

  ever seen. And I think something like the Circle IPO was very representative of that, where everyone on CT for the past few weeks was just mega bearish on this. It was, ah, like, the margins are compressing, Coinbase makes all the money on this, like, how do you justify this valuation? And then they list it, boom, 25X oversubscribed, the thing rips 5X over the next few days. And like, here we are. Do you think it's because it's so simple? Like, why?

• 6:33David Hoffman?

  Yeah, I'd actually like to pull this apart.

• 6:36Speaker 02

  I think people really want stablecoin exposure. I think it's really, I think it was really that simple. I

• 6:40David Hoffman?

  So it's a narrative trade. It's a narrative play. Like, there's, I think we would all be in agreement, the fundamentals of the Circle business does not at all justify its valuation.

• 6:50Speaker 02

  I agree with that. And then, I mean, there's some degree of fundamentals versus what is the short-term price. You know, if you bought the grayscale Bitcoin ETPs a few years ago, because that was the only thing that you could access and you wanted to express a bet on Bitcoin, was that a bad bet or a good bet? Depending on where you bought it, I mean, it was a bad bet in the sense that, I mean, you're paying twice what is the underlying literally worth, but you had the right macro bet and over a long enough time horizon, if that's the only way that you're allowed to express your bet, maybe that is a rational thing for you to do. As someone who is able to take much more, let's say nuanced and directed bets on, I think there's going to be a lot of stablecoin growth, what are the protocols I want to invest in to profit off of that, whether that's DeFi projects or what other early startups, I think that there are better

• 7:35Speaker 02

  alternatives. But the reality is for a lot of people, they do not have access to those alternatives. They don't have the sophistication or the desire to invest in those alternatives. They see, this is the big regulatory stamp approved, this is the nice whitelisted, white-glove American stablecoin provider, and they're a public company now. I can go buy this thing. Is it expensive based on comparables? Yeah, it is, but I really want exposure to this thing. And so people are going into it. I think it's that simple. I think there's a scarcity effect that people really want stablecoin exposure. And there's limited opportunities to do that, particularly in a public markets way. So people, I think people just really, really wanted exposure to that.

• 8:12David Hoffman?

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• 8:56David Hoffman?

  or your go-to decks, stake it, and help shape Frax Nation's future. Join the forefront of DeFi, visit Frax.com now to start earning with Frax USD and staked Frax USD. And for Bankless listeners, you can use Frax.com/r/bankless when bridging to Fraxal for exclusive Fraxal perks and boosted rewards. Uniswap is your gateway to a more efficient DeFi experience. With Uniswap swapping and bridging across 13 chains is simple, fast, and cost-effective, helping you move value wherever, whenever. Thanks to deep liquidity on the Uniswap protocol, you'll enjoy a minimal price impact on every trade. And now Uniswap V4 takes it even further. Swappers benefit from gas savings on multi-hop swaps and ETH trading pairs, while liquidity providers can create new pools at 99% lower costs. The best part, you don't have to do anything extra.

• 9:41David Hoffman?

  Each trade is automatically routed through Uniswap X, V2, V3, and V4, so you get the most efficient swap without even thinking about it. Whether you're swapping, sending, on-ramping, off-ramping, or bridging, Uniswap's web app and wallet gives you the tools to unlock DeFi's full potential on Ethereum, Base, Arbitrum, Unichain, and more. Use Uniswap's web app and wallet for a more efficient way to use DeFi. Okay, so Circle right now is trading at $106.00. That's about $25 billion. Just for reference, comped to Coinbase, Coinbase is like $65 billion. And Coinbase has like 30 or 40% of the revenue coming out of Circle, out of USDC. And so there's just a huge mismatch here. Like, why, why would Circle be valued at $25 billion when Coinbase is valued at 65?

• 10:26David Hoffman?

  And like, yes, you could just be like, I don't, I don't care what it is. I want stablecoin exposure. Circle is the only thing I can do to get stablecoin exposure, therefore I'm going to slam buy. To me, like, I can't really differentiate that between somebody being like, yeah, like, I want, I want access to blockchain technology and, you know, banks running blockchain technology are the future, therefore I'm going to buy Ripple. Like, the disconnect between fundamentals and actual, like, reality is just so large here. Like, you're, I'm, John, I'm guessing you're not buying Circle. Brett, I'm, you're not buying. I don't think anyone on crypto Twitter can justify buying Circle at a $25 billion valuation. And so what, one half of me is like, well, you know, we all just mid-curved it

• 11:11David Hoffman?

  because the thing to do was to clearly to buy, at least in this moment of time. But then also I'll like project forward, you know, five years, be like, well, will it justify itself then? Like, like, maybe we're not, maybe we're not right now, we're just early. But then also, like, being early is also being wrong. I only know how to think about it.

• 11:30Speaker 01

  I think it's mostly commentary on just like the, the size of our, our ecosystem, right? Like, like one, like, yes, we have awareness of all these, these comps within the ecosystem that we can look at like Tether and say like, look, Tether is, is dunking on Circle in every measurable like factor. And like, we have awareness of it. We can't get exposure to it, but like, we have awareness of it. So it allows us to like, look at it, say it's not the best, it's not whatever. And then just like the relative capital size of players in our ecosystem to the gargantuan TradFi world, like the public markets, right? Like, this could be, this could be the splash on effects of just like a bunch of people in that market that just want to get exposure to it. And as Sean said, this is the only thing they can do. So it's just like, yeah, they could pump this thing to 26 bills and like, that's not really that big of a deal to them in their market. Cause it's like,

• 12:14Speaker 01

  that this is what we can do. And this is like, this is the splash on effects of our, our capital size relative to us, where it's like, that's a big thing. Like this, like all of this was a crazy move. And yeah, we couldn't move it that quite this, to quite this degree because our purchase of small fish, right? Relative to the, to the global markets.

• 12:32Speaker 02

  Yeah. So this is one of the funny tweets I saw. Someone did the math of, I don't remember the exact number, but it was basically if you take the current multiples that Circle's trading at, and if you throw that on top of Tether, like, oh yeah, we get, we get an implied valuation of like a trillion dollars or something like that.

• 12:44David Hoffman?

  Right.

• 12:45Speaker 02

  And so do you actually think it's worth that? No, probably not. And so I, I do not own any exposure to Circle right now. Cause I, I can't justify the current prices based on, you know, what I think are reasonable expectations. But

• 12:58Speaker 01

  But you're not dumb enough to short it?

• 13:00Speaker 02

  Yeah, I'm, I'm not shorting anything in crypto. I, I have no clients to do that at all. Like they, they are a great business and I wish them success. I mean, that's separate from, you know, what, what do I think the short-term price is going to be? But even as someone who doesn't hold any of it, the, the sentiment has been super positive around crypto, around this, and as it should be, because I, this is a great, really healthy sign for the industry showing, hey, there is a lot of demand for this. This is something that people take seriously. This is another step in the maturation process of, we have another big listed public company. What is this very likely to do for all of those other crypto companies that were considering going public at some point in the medium term? Maybe they were thinking about going public next year. Those timelines are probably being

• 13:42Speaker 02

  pulled up. I saw one of the tweets was, it was Gemini, Gemini, I believe. They were pulling forward their timeline to looking to file. There's a number of other exchanges, another

• 13:50David Hoffman?

  Yeah, the race is on to go public right now.

• 13:52Speaker 02

  Yeah, this was a very clear sign that hey, the market's open now for this. And so that is super healthy and really, really positive for us to see. And that has trickle down effects throughout the rest of the funding and startups and all the other products in crypto that are downhill about.

• 14:07David Hoffman?

  It would be interesting to see the price performance of Gemini post IPO because Gemini is an exchange. So it's going to get comped to Coinbase, not to Circle, but it's Circle that is the firing gun for Gemini's like being okay. Like it's, we're good to go and Kraken is going to be the same, like Kraken's probably making similar moves. And as a coin holder, I was excited for Circle to go live because I was hoping that that like positive valuation would blow back onto my coin bags, which didn't really happen. And so there's an interesting juxtaposition there of like, oh yeah, Gemini, Kraken chomping at the bit to go public, but their comp is Coinbase, not Circle. And so like, I don't, I don't know if the market's going to give them, maybe unless there's like a fresh chart premium for IPOing.

• 14:52David Hoffman?

  I don't know. I don't know if that exists in TradFi. What do you guys think about that?

• 14:56Speaker 02

  I broadly agree. I think the really, really strong demand right now is for stable coins in particular. And that's the niche that Circle was filling. And so I don't think that these other ones are going to fill that exact same gap. But nonetheless, I still think it is a very healthy sign that you have just showing, hey, there is market demand for institutional grade crypto products right now. This is something that institutional investors want to be investing in now that we have all the clarity. So it's a good sign nonetheless. I agree that it's, it would be even better if they were the third biggest stablecoin issuer to go and IPO right now. That would probably be the thing that you want to do even more, but it's a positive, not a sign nonetheless. And how well they go will be a good indicator though of how broad this demand is and what, how does that bode for other crypto companies that are potentially considering?

• 15:40Speaker 02

  Cause I assume that it's very possible Gemini or someone like them is next in line. And so we'll see what the demand there versus how isolated was this just to crazy stablecoin demand, which is possible.

• 15:52David Hoffman?

  Yeah, I mean, how many, we are six months into the Trump presidency. So like Coinbase went public 2021, really before the Biden SEC crackdown on crypto. So they just got in right before that gate shut. And then we had just, you know, four dark years. And now, you know, Trump comes in, opens up the gate, people start to go public. And now, now there's like kind of a lineup, right? So MicroStrategy also was able to finagle their way into like becoming a Bitcoin acquisition company because they were already public. But now, like Joseph Lubin and Sbet and like there's another Ethereum acquisition vehicle company. And now there's like Bitcoin copycats and it's like Soul Strategies. And now there's also Circle and then Gemini and Kraken and Anchorage and I don't know Chainalysis, they all want to go public. So there's a growing

• 16:35David Hoffman?

  number of ways to get crypto exposure, or potentially soon, by the, maybe by the end of this year or early next year, there will be like a pretty like rich number of ways to get exposure to crypto in TradFi and without even like having actually to go into the crypto industry, which is, which is kind of interesting. I'm curious as to like how that market equilibrates when there's a variety of different ways to get exposure. Again, even in addition to the ETFs too. And you don't even have to like join the industry. You can all just do it from like Robinhood or your brokerage, whatever.

• 17:08Speaker 01

  You had me curious, like, obviously, we all know Circle and Tether are the two biggest or USDC and Tether the two biggest coins. Like, okay, like, what is the third biggest stable? Is there another stablecoin IPO on the horizon that we could like even like realistically look towards? And there's basically nothing. Like, there's Paxos. Market caps, yeah, there's market, the market cap for Tether and USDC are 150 billion to 60 billion. The next biggest, which is Athena's USDE is 6 billion. So like, the falloff is a 10x below USDC. And then like, then it's DAI, Sky Dollar, BlackRock, then even like World Liberty Financial's like US dollar, whatever the hell it is.

• 17:41David Hoffman?

  Paxos isn't on there. Like Paxos is like a stablecoin whitelister. So it's not gonna have one single.

• 17:46Speaker 01

  It's like an infrastructure.

• 17:47David Hoffman?

  Yeah, but like, it's not going to command any sort of like premium that Circle did. Okay, so question for you guys. Two, like 160 billion dollars of stablecoins on Ethereum and ETH BTC is like, you know, I have seen. Tribally indifferent profit maxies be posting about the ETH BTC ratio. Like it's been flat for three months for the first time in two years. Stablecoins dominantly on Ethereum, we know this. But then also Bitcoin dominance is just creeping up and up and up and up. I put out this tweet, which for some reason like triggered a bunch of people. Max pain is 75% Bitcoin dominance and no altcoin season. And for the record, we are at 64% Bitcoin dominance. Going from 64% to 75% is a big move.

• 18:32David Hoffman?

  It's like a much larger move than going from like 40% to 50%. Cause that, yeah, as there's less, as there's more Bitcoin dominance, it's harder to become even more dominant. So there's a lot of people like interpreting this tweet differently, but like for some reason, I feel like there's some horseshoe phenomenon where you have like stablecoins on one side and Bitcoin on the other. And when stablecoin growth is big, it validates, it goes all the way back around and it validates Bitcoin. And then like the Ethereum, the pro Ethereum side of things was like, well, no, Ethereum is the stablecoin blockchain. There's $160 billion of stablecoins on Ethereum. Brad, what do you think?

• 19:08Speaker 01

  I hate that I keep going back to this, like ETH technology can be great for stablecoins. It doesn't necessarily mean ETH the asset goes up. Like, that's the problem. That's the problem. Like there's, there's structural stuff in place that like the Psyop Bitcoin bulls can like, people are just going to buy it. Cause, because you always think there's going to be a next buyer, right? You always think the next buyer is the nation state, or it's the government, or it's the whatever, someone on a treasury. Like it gives everyone confidence to buy this thing because you can peg the next buyer on that thing. Where it's like ETH is delivering all these technical properties that are fucking awesome for stablecoins, right? Like it's great. I want to have my assets there as credit neutral to centralize, but like, I don't need to have ETH the asset in order to like, not in size, in order to have my stablecoins be settled to and transferred in and denominated in on Ethereum mainnet.

• 19:52Speaker 01

  It's like, without a high velocity there and like bringing execution back to it. Like, I think that is the unfortunate truth is like, I can say, yeah, stable, stablecoins are on Ethereum. That's fucking great. Like they belong there. Ethereum's awesome. Doesn't necessarily mean the asset has to go up.

• 20:06David Hoffman?

  Yeah, yeah, there's a difference between like a stablecoin exchange and a stablecoin vault. And Ethereum, I think is a very big stablecoin vault. And I don't, I don't know how much like Dex, stablecoin Dex volumes there are. I mean, there are definitely ample supply, but enough to generate fees. John, what do you think?

• 20:22Speaker 02

  The perfect test case, it's kind of funny. I mean, we just debated. Ryan Berkman's had actually tweeted out, I believe the tweet was, was it a couple of days ago? Of Tether makes billions a year on their ETH business, but their BTC maxis and alt-L1 launchers. Meanwhile, ETH is on track to become a multi-trillion dollar asset without a Tether bid. Let's see if Tether ends up foming ETH when they see BTC as the first, but not the only special. So like, to which I replied, or they're the perfect example of why Ethereum providing value does not equal ETH capturing value. Tether is the quintessential example of, they have built a gigantic profitable business, which in large part does use Ethereum with, there's a bunch of Tether there. They use the chain obviously very, very heavily. And you can go check Pal's tweets and, you know, what is Tether holding? It's Bitcoin and gold.

• 21:07Speaker 02

  And so it is that still very barbell of, hey, we can use the chain, but still kind of just be Bitcoin maxis. And so where does that go in the future? If there's increasingly even more stablecoin issuance on Ethereum, is that positive for Ethereum enough? My, I mean, people debate this one all the time, like how positive it is for your chain? If there's a bunch of RWA's on there? My gut is it's, it's still positive. It's just that we do have to realize that there is a difference in value accrual between, hey, someone puts $100 billion or whatever, some crazy number of T-bills, dollars, whatever, that's sitting on the chain. It's, but it's, it really is just idle capital that's not moving. Maybe a sex has it off-chain or whatever. This is just, you know, a money market fund that someone has a bunch of money just sitting there.

• 21:53Speaker 02

  And the off-chain issuer is just clipping all the money versus we have a bunch of money on chain. That's high velocity capital and is being traded a lot, is actively producing a lot of fees. Those are obviously qualitatively different and do have quantitative results on, you know, what is the value capture for the base asset? And so Ethereum is more in that former camp of a lot of the capital there. It's, it's winning in the size of capital and it's not currently winning in a lot of the velocity of capital metrics. Things like trading volume and a lot of user metrics. And so it's definitely still positive in my mind to be winning the institutional capital and a lot of big money going there. But it's definitely not a one-to-one comparison. And so looking at it simplistically, I think just doesn't hold up, obviously.

• 22:32Speaker 01

  I just like.

• 22:35Speaker 01

  I hate that like everyone's tying winning or like success to just like raw dollars like the the price going up like that's what's like that's the the fight everyone's having right it's like it's doing great like it's service like it's doing all of these things it's servicing its purpose like it has this crypto ethos like it's doing all of that but everyone views it as a failure because price isn't going up and like unless my bags are going up like this thing sucks right like and like that's that's not the case maybe maybe there's an acceptance where it's just like and like I've talked about like the compression lower of like all these infrastructure plays like you know what maybe all these things will serve their purpose and like facilitate app growth and like all of them will kind of just like sit where they are they don't all have to go up infinitely for this to be a successful thing and like if that's a like the future of this world like maybe that's just how it's gonna play out.

• 23:21David Hoffman?

  I think there's like two common trains of thought which will put you in two different conclusions depending on which one you are there there's one that is like okay in one to two years there's gonna be 10x of as much real world assets tokenized on Ethereum as they're on today and then like the the ETH bull will say and just by proxy of that ETH will be bullish just by association just like at some point BlackRock is gonna have so much assets under management on Ethereum that they're just gonna want ETH by proxy of that and people in their orbit will also just want ETH by proxy of that you know how much demand does that create uncertain maybe not a whole lot but like still like 10xing real world assets on Ethereum is going to you know have a huge halo effect around the

• 24:06David Hoffman?

  Ethereum brand and ether the asset and that's bullish and like I think that's some somewhat true.

• 24:11Speaker 01

  I agree with that.

• 24:12David Hoffman?

  I think that's mostly true and then there's like I'll like the John Charbonneau's which is like show me the mechanism for how it captures value and if it's not there then I'm buying Bitcoin and I kind of understand that too like there ones like and a little bit of a narrative play it's a little bit looser it's a little bit more about belief about the network and the growth of the network and then the other ones a little bit but no like no show me show me the burn show me the value accrual I want to see the burn and it's like you I also I see that one I see that one as well.

• 24:40Speaker 01

  Yeah.

• 24:41David Hoffman?

  It's a very.

• 24:41Speaker 01

  Both are gonna happen.

• 24:43David Hoffman?

  Yeah, yeah, both are gonna happen, both are gonna happen. What do you think about this tweet from from D's? D's, I consider a good faith prophet maxi tribally indifferent trader who's in it for the vibes. He's tweeting out the ETH BTC ratio and he just goes underwater beach ball. What do you, John, when you see this tweet, what do you, what do you see?

• 25:02Speaker 02

  The, the chart looks good to me as someone who doesn't understand charts at all. I remember the last time someone asked me on a panel, like, what do you do for technical analysis or whatever? I've answered, I have never drawn a line on a chart in my life and I do not intend to draw a line on a chart. Not what I do.

• 25:21Speaker 01

  Yeah, yeah. So like, I hate that I can draw lines on charts and it makes me feel smart. Like, I can, I could do it. I was like, hey, that actually did hit this thing.

• 25:28David Hoffman?

  I do feel smart when I draw lines on charts.

• 25:30Speaker 01

  It actually did bounce whenever I drew this thing. Am I good? I think part of it is like a self fulfilling prophecy. I don't ascribe any of that stuff here, like, just because the lines there doesn't mean shit, right? It's all, it's all like backwards looking to where like, oh, it didn't validate the line. Therefore, my entire thesis changed. I no longer think it's a beach ball underwater. I think this thing's going to this crater, the center of earth, right? So it's like, it's always gonna do that. So he's trying to be a little predictive here. But yeah, I also still just agree that like, you need structural shit. Like, you will have the splash on stuff that you're talking about and, but you, it's all about conviction that you can instill in people. Like, that's all it is. You need to instill conviction in people like John, right? Who, like, he needs to see material things and you need to instill conviction in people who are just like all vibes based. And like, yeah, man, it feels good. Like, everyone's having a great time on the chain.

• 26:15Speaker 01

  Like, I'm gonna buy it because all my homies are buying it. Like, so you need to service all of these things. It's just the Johns of the world and like, I'm starting to get into this camp. It was just like, I'm, I need to see, I need to see more of, of like structural stuff in place of value accrual. And like, it's just, it's just not there. The one thing I am getting, starting to get a little bit pilled on, and I even wrote about it, I think, today. And the response to the debate thing is like, we're talking about these nation states, like, if they, if everyone's gonna come on chain, right? We have all these RDUAs, like, everyone's starting to put more and more money on chain. Like Ethereum is like the place that most people would trust their, their, a large amount of assets to be. Okay, cool. Like, if you take that a little bit further and say like, well, Smart contracts on Ethereum still aren't like totally trustless and like in an adversarial

• 26:57Speaker 01

  environment. Like I don't want some, I don't want tether or circle to be able to like unilaterally freeze my shit. So it's like, if I, if I have to accumulate ETH and I want to like, I want to put assets on chain, or if I have to accumulate, if I have to accumulate assets on chain, money on chain, I'm going to accumulate ETH because it's the only thing that like is truly like incredibly neutral, permissionless, pristine, as Justin would like to say. It's like, it's the thing that no one has control over. And I, I do appreciate that outside of like maybe changing some inflation numbers periodically, but that's few and far between. That like, that gives the scaries to some people.

• 27:26David Hoffman?

  Generally bullish, not bearish. Yeah. Those changes, yeah, I pointed upwards.

• 27:30Speaker 01

  I would agree. Yeah, I would agree. Like minimal inflation relative to the entire market. So like, so then like the next question is, okay, what is, what do we think the global appetite for something like that is going to be on the long run, right? If we think everyone's going to bring their assets on chain, we're talking 10 trillion, tens of trillions of dollars potentially. Okay. Like if you want to do that in an adversarial environment, are they going to accumulate ETH to sit there and hold on to it? Because that is the one asset across all of these chains that is like the best place to just like store your value, right? Or to like not, not have to worry about third-party risk or counterparty risk? Maybe. But is that enough to pump the price to, to Valhalla? I don't know.

• 28:04David Hoffman?

  Yeah. Yeah. I do think in the future, when like central banks are counterparties to each other, that will be done on Ethereum. Like, without, without.

• 28:15Speaker 01

  I think like a terrorist negotiation, right? Like if, if North Korea wants to do, do a deal with like you guys, like, look, man, like that, they spin up a smart contract, it's publicly viewable. It's like, I don't want, I don't want anyone to be able to intercept this shit. They're going to probably do it on Ethereum. Like that's like, that is the place where that entity has to do that thing for like some high stakes shit. It's going to take, like, it's probably going to take place on Ethereum mainnet. I can do it on base, right? Base is going to rug me and it's going to steal all my shit. It's not going to happen on, on Bitcoin. It can't even fucking do the thing. It's not programmable. Okay. It's not going to be Solana because of whatever reason, right? So like, now the question is like, how much value is that? Right? I don't know. That's, that's the question.

• 28:52David Hoffman?

  Let's talk about hype really quick, group. Got the hype chart. We hit a $42 with hype, which is I believe an all-time high. I was talking to a crypto Twitter legend who will remain unnamed, but they said, they're, they're bearish soul because of how well hype is doing. What do you think about that line? Bearish Solana because how, how good Hyperliquid is doing? John, what do you think?

• 29:15Speaker 02

  So I mean, disclosure, I've said this a bunch of times before, but we own both. We own both hype and soul. I think it's fair to say that soul is definitely starting to see at least the early stage difficulties that ETH has had over the past few years, which is, I mean, the largest part of it is it's really hard to move an asset that's $100 billion plus. It takes a lot of, you really got to show me something to convince me, hey, there's a lot of upside left on this thing. And so, I mean, very simply looking at soul and hype, I mean, what are the metrics that you can look at? Obviously, one of them is just like fees generated in some form. They're both like pretty comparable right now. So soul's been running a bit ahead there, REV relative to like hype fees. Really?

• 29:58Speaker 02

  Solana is generating as much fees as Hyperliquid is? Yeah, they're in roughly the same ballpark. I think the ballpark has usually been that soul is generating REV of like closer to actually a billion dollars annualized. Wow. Possibly a little bit more and hyper. I thought Hyperliquid would be running circles around them. Oh, no, no, no, no. Yeah, no, Hyperliquid is still behind soul on like actual fees to the chain. And then Hyperliquid is in the ballpark. It's usually been in the 600 to 700 billion dollars annualized. Obviously, these numbers fluctuate up. At times, soul has been much higher, especially. But that's ballpark, I believe, where they are right now is Hyperliquid's somewhere in the ballpark of like 600, 700 million annualized. And then Solana is like closer to a billion dollars of REV. Solana Rev was 1.4 bill last year. Yeah, like that sounds right. Yeah, so it's in the same ballpark, but soul is like definitely higher.

• 30:44Speaker 02

  And the other part that's notable on that, and this gets into the, you know, apps versus platforms point, is you look at what people are paying to Hyperliquid, it's not the hyper EV app that's generating still at this point, even though people are talking about it, effectively a de minimis amount of fees, certainly relative to Hypercore. The vast majority of this is at the app level. That is what people are paying for versus on soul. Obviously, these are platform level fees. This is REV. And on Solana, where is most of the money going? It's going to platforms like Pomp, it's going to Acxiom, it's going at the app layer. So there's certainly a lot more economic activity that's happening on soul. It's just this, this soul versus hype is very emblematic of the current big meta.

• 31:25Speaker 02

  Question of platforms versus applications on on top of them. What is actually going to be the revenue generator going forward? What is sticky? What really owns the user? So that it's it's very much a bet on that kind of split. And I mean, even in Solana, I mean, this is why we've also been investing increasingly at the application layer and not just at the protocol layer as well. Because that is where I think a lot of the stickinesses and a lot of users are going to gravitate there. So part of it is that of just, you know, do you build a first party application versus a totally general general purpose platform? And then the other part of it is just sheer size, you know? Sol has hit 100 plus billion. And so people various naturally start looking for, okay, what's the next trade? What's the next Solana? People always want to hit, you know, what was the next Ethereum after Ethereum, you know, went at $80?

• 32:09Speaker 02

  That was sold at eight and people are saying, okay, what's the next? Like, you gotta hit the next one. And so people kind of like are naturally always looking for that. Hype is in relatively good position for people just like psychologically want that kind of trade. And these are two of just the big applications and platforms in crypto that just currently are successful and people are using a lot. So.

• 32:29David Hoffman?

  Hyper liquid right now is at $40 billion versus Solana is $95 billion. So obviously still a gap, but not that large of a gap. And so I think the universal question that I'll ask as a representative of the hype sidelined tribe. Is it too late to buy hype at $41 at $35 billion? Cause like, that doesn't make me feel good. Like, I feel like I'm just top blasting everyone's like, you know, $10 purchase that they bought during like the tariff scare.

• 33:02Speaker 01

  It depends on what you think the the general growth is going to like the. Yes, John is doing great at comparing like what is going on with hyper liquid fee generation versus the rev of Solana. But like rev was created as like a proxy to try to figure out demand for for the actual block space on Solana. And then like to try to like determine, okay, there's what's the value accrual here, right? There's clearly a bunch of activity going on in the chain. How much of that is going back to to the native assets? Hold on, like, do you apply a multiple to that? Like, you know, all of this stuff, whereas like 100% of this shit that's being generated. On hype is like, I think it's 97% of the actual fees are going to hype buyback. And that's instilling a lot of conviction. And then like you think about the growth.

• 33:42David Hoffman?

  A dollar generated by hype revenue is worth like, I don't know, five, 10x more than a dollar generated by Solana revenue because it just goes straight back to hype buybacks.

• 33:50Speaker 01

  Yeah, because some of that goes to like, well, we're going to have the pump ICO soon. Like, so like some of that's going to be going to the pump token eventually. I'm assuming it's some component like some of it goes to GTO, some of it goes to like the photon, you know, trading bots. So like it gets dispersed amongst a bunch of things, whereas because hype has created the tier one application, right? The native app, like basically all those fees go directly to just buying hype the token, right? So, and then now it's kind of becoming a cult thing where like a lot of the actual applications being spun up on the hyper course or the hyper or hyper EVM side are kind of doing a similar thing. It's kind of like an honorary burn. I don't know how long that'll last because everyone's just going to profit max, but you know, that's, it's kind of a thing. So, you know, I was top blasting the whole last like, oh, three

• 34:33Speaker 01

  weeks. So I bought from like 26 up to like 36 over the last few weeks. So I anticipated going a little bit higher. If you think it's going to continue to grow its moat, they're talking about like now a bunch of other, a bunch of other DeFi or not DeFi, but blockchain native applications are buying tickers and trying to do their launch on hype specifically as opposed to doing it through centralized exchanges. They're talking about, you know, doing unit to bring on much more assets. They're talking about hip three is the big thing that everyone's discussing lately because it allows more and more units are not units, more and more assets to be brought on chain to be traded. So like, if you think it will continue to grow just by it being the virtue of it being a good product and people wanting exposure to hype, then like, yeah, you can expect more revenues, which you expect more bullishness, which you expect price to go up a little bit more. That's, that's my thesis.

• 35:18Speaker 02

  I generally don't have a very strong opinion usually on value distribution mechanisms. I think in most cases, it doesn't make a tremendous difference whether you're taking in fees slash RAV from users and using it to buy back and burn the token versus distribute it directly to stakers. I think there's a meaningful difference if you're redeploying it for growth, you know, if you're taking those funds aside and using it to grow the protocol, but if you're returning it to shareholders in some form, whether it's a buyback or staking, I don't think there's actually a tremendous difference. It's just a company doing dividends versus buybacks. It's not, it's not a huge difference to me. I think the bigger difference when you're evaluating platforms versus application level fees, and this is something we've traded back and forth on bread is I think the more important point to me is.

• 36:02Speaker 02

  Depending on what type of activity you're using to generate these fees/REV, you may take a different view on how sticky those are and how much headroom they have to grow. And so you would apply potentially different multiples on them. Simple classic example would be, you know, if you looked at Ethereum fees back from a few years ago where it was generating, I mean, the annualized run rate was something crazy. It was like $20 billion a year. But where was all of that coming from? It was just a shit ton of congestion fees. It was super, super high base fees. You know, people were just like eating $500 to get a Uniswap trade done. Like, obviously, that is not sustainable activity that you like. You could project forward in any reasonable way whatsoever. That's like obviously going to go away at some point.

• 36:42Speaker 02

  Versus, I would say there's a higher degree of sustainability to a general purpose platform where you know users are paying right now a fair amount of priority fees in MEV. And this is where Solana Value Pro primarily is right now compared to ETH. The base fees are de minimis effectively, and there's a meaningful amount of priority fees in MEV. So I would say that's generally a stickier source of revenue compared to high base fees. It's, I would say, it's a little bit more durable going forward. But at the same time, apps are trying to eat into that margin, too. And if there is too high a margin on priority fees in MEV, well, then they'll leave and go make their own chain if they're not able to internalize it on your chain. So even that's not perfect. And then I think generally the stickiest thing is going to be if you just have a killer application that people love to use, and there is a big market for that to grow into,

• 37:25Speaker 02

  you will put a different valuation multiple on something that has revenue that you might assess to be a lot stickier, a lot more durable, and a lot more headroom to grow. So that does make a difference in what type of platform you're looking at. You know, what is the quality of this revenue that you're actually getting? And, you know, how can I forecast that forward? So that does end up looking pretty different on a platform versus an application level.

• 37:47David Hoffman?

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• 38:30David Hoffman?

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• 39:15David Hoffman?

  SELF verifies authenticity with zero knowledge proofs. Each passport creates one unique identity. Second, you can share proofs privately. Third-party apps request identity proofs, like confirming you're over 18. You can also link proofs securely to public wallets for airdrops or governance participation. And then last, secure verification. Apps validate your proofs instantly on-chain, like on Cello, or off-chain. Audited by ZK Security, the SELF app is live on iOS and Play Store. Visit self.xyz and follow SELF Protocol on X. There's two shards that will tell you a bearish or bullish story about Hyperliquid. This first one is Hyperliquid's market share around DeFi perps, so Dex perps. It's already at 78% market share in the Dex landscapes.

• 39:58David Hoffman?

  Going from 78 to 88% is like, pretty hard. And then also you're only growing that much more. Like, so like, to growth is tapped out on Dex perps. So like, where does Hyperliquid even go from here? Like, how does it get any bigger than this when it's already at like 80% of market share? And like, congrats, you've won when like your number two competitor is other. Like, it's just the other category. Like, you just won, you just won Dex's, but like, you're also, you're also done. Like, there's, there's no more market share for you to go to. That's the bearish case for Hyperliquid. The bullish case is looking at Hyperliquid versus Binance perps volumes, where weekly Hyperliquid volume, I think, has peaked out at 11% versus Binance's 88%. Hopefully this Dune dashboard is correct.

• 40:41David Hoffman?

  But if you just look at Hyperliquid versus Binance, being like, well, it's only got 11% of Binance's market share. That's a whole lot of fees left on the table. It could ju- if it goes 50/50% versus Binance, it's going to 3X its fees. And all of a sudden, that $40 billion, so Solana's $95 billion, does look pretty justifiable. But I think it's really a function of just like, how well can Hyperliquid get Binance traders to migrate over to Hyperliquid? And why haven't they, why haven't they already? Like, why haven't they by now? I don't really, I'm not a perpetrator, so I don't really know. I don't know if you guys, either of you have any like, information here?

• 41:16Speaker 01

  Yeah, so the difference or the edge that we had at Megieth that like is encroaching specifically on what Hyperliquid is maybe losing to some of these centralized exchanges, is that the centralized exchanges are just like, they're more performant, right? They don't have blockchain backends, they don't have to deal with latency, they don't deal with block times. So they're very, very performant. And the most of that is a downstream of like, needing consensus, right? Takes time to actually like, agree on something which makes it good and true. Like, they do some stuff to get around that. But for us, like, if you have, or this is L2s broadly, if you have a chain that has a centralized, or a predictable block builder, right? Then you can co-locate next to this thing. Then you can start to encroach on some of these performance numbers that centralized exchanges actually can tout, right?

• 41:56Speaker 01

  So like, this is, this is like a comparison against GTE, which is our, one of our applications building on Megieth. Like, they're working specifically with market makers so that they can co-locate next to our sequencer, so that you're, the latency round trip for them to actually execute this stuff on chain, if it's cheap enough, is, you know, in single-digit milliseconds, right? And because you can afford that stuff, or because you can, you can get some predictable outcomes from, from the construction. So like, if volume is the metric that just says like, these are the things we want to capture, and we want to bring that stuff on-chain, this, this is a vertical that we're actually trying to push for, because Hyperliquid may not ever be able to approach on that, because, yeah, they have, they have a distributed validator set as an L1, right? If you're doing that, then you necessarily can have a little bit of delay for achieving consensus.

• 42:39Speaker 01

  So, you know, will they ever be able to eat into GTE because of that, that fallback? We are not GTE, but for Binance, because of that latency fallback? Who knows? But that's the, that's the vertical that they're pushing for.

• 42:51David Hoffman?

  So what you're saying is this gap between the like 75% market share that Hyperliquid has on the DEX side of things, versus the like 9% market share that has versus Binance? That gap is the latency of the, the after-market?

• 43:05Speaker 01

  Yeah, it's just saying like, like, like, this is volumes, right? Volumes are going to be mostly dictated by these very large players that are doing high-frequency trading, trading, you know, tens, hundreds of millions of dollars pretty consistently. And they do that stuff because there's some properties that they can count on. Whether it's, it's not too expensive for them to execute the, the order, they can get rid of toxic flow, they, they have latency expectations for like interacting with the thing that is actually taking the order. And it's like, will they ever leave the confines of a centralized exchange that can say, look, bro, you can get your order on-chain for free, or not on-chain, but you can get your order in the order book on-chain, or fuck, it keeps saying it, on the order book in single-digit milliseconds for free. Like, will they ever leave that environment to go to a public ecosystem like Hyperliquid that it costs money to put your order on, you have to deal with toxic flow for ordering?

• 43:49Speaker 01

  Like, like, will they ever opt into that? Maybe not, because the performance is not going to actually really be able to keep up on the latency side with, with a centralized counterpart. But like, maybe the middle ground becomes a construction like an L2 where you, these market makers can co-locate next to a sequencer, which is the block builder, doesn't have consensus, so you don't have to worry about the delayed block time. It's a much more predictable environment.

• 44:08Speaker 02

  Well, I'm going to agree with half and then disagree with half. I, I agree the half that matters is the centralized exchange side. I, I don't agree that latency is actually the determining factor here, or the reason why users or market makers are primarily on these exchanges. I, I think the, the very direct risk to Hyperliquid is primarily that, for example, you can imagine perps getting legalized within the US and having a regulatory framework around that in the short to medium term, like, there's clearly regulatory and institutional interest in that happening. And then the question is, okay, Robinhood and Coinbase have perps now, what do you use? Do you use Hyperliquid or do you use Coinbase? I, I, as a US citizen, do not use Hyperliquid, but if I were to hypothetically use a perps

• 44:51Speaker 02

  platform in the United States, in New York, I, I would probably have to use one that does not KYC and take my documents in the way that finance does. So you, you could imagine some of those users may be using Hyperliquid now, but they might go use Coinbase or Robinhood if that option presents itself to them. I, I don't think that's a latency consideration to them. I think, I think that's just the fact that they own the user and they're a good product and I, I trust them with my funds. And, and empirically, I mean, most users are getting their face ripped off when they trade on Coinbase and Robinhood, like, they're not paying these cheap fees for best execution. And market makers are increasingly, to my understanding, I mean, the big market makers really are on Hyperliquid and it is quite profitable flow. And it's not entirely clear to me that reducing latency further based on where they are is actually going to meaningfully improve execution, particularly within the fast batches where

• 45:36Speaker 02

  they do have prioritized and free cancels, which does help the market makers a lot. So my understanding is like that they are trading there now, all, most of the meaningful ones, and they are doing well and users obviously love it. The bigger issue to me is the regulatory clarity that comes around perps. And then you assume that all the major players who are currently being held back right now, do they come in and squish the market? Does Coinbase come in? Does Robin Hood come in? And do they win the market now that that is the best available option to most users? Does Hyperliquid still have a product market fit after that?

• 46:05Speaker 01

  Do we have a regulatory event with Hyper in the future, do you think? Obviously, you just called out like the KYC, like not being a requirement for coming and operating on chain.

• 46:14Speaker 02

  Yeah, I mean, this is a risk to them existing right now is that the, there is very unclear regulatory clarity for, I mean, pretty much all decentralized DeFi protocols. But I mean, especially someone like Hyperliquid that obviously is not KYCing and is a, is a somewhat decentralized network. But this is all the stuff that gets into like the market structure built to of, and a lot of the legislation and that regulators are thinking of is what is a sufficiently decentralized or sufficiently mature network? What exactly is your definition of that that allows you to operate differently than a centralized counterparty? And that's all TBD still. So yeah, it's certainly a risk for them.

• 46:49Speaker 01

  It strikes me as like a tether versus circle debate with how their approach to the market where like everyone has fought Hyperliquid specifically of like, oh, unregulated exchange, you're doing all this stuff and there's no KYC, you're going to get footed, which is like, that's what's been pushed back against Tether for the longest time. It's like, oh my God, they, like, they don't have any, like, audits, you can't tell who's doing what, like, there's just a lot of opaqueness to the actual system itself. But it like, because it just like, asked for forgiveness as opposed to permission, it got an incredible amount of network effects and like, like, like, it's all throughout the ecosystem now. I wonder if it might be similar with Hyperliquid where like, they, like, yeah, it's probably not like, the best way to go about this thing if you're doing it by the book, but like, they've undoubtedly like, 75% market share, right? Like, it's crazy. Like, if they continue to go down that path, does it get to a point where it's just like,

• 47:33Speaker 01

  all right, we'll ask for forgiveness, pay some dollars, and then we're on our way?

• 47:36David Hoffman?

  I don't know if that's the right comparison. I think the better comparison, because Tether hasn't done anything illegal. Like, there's nothing wrong about Tether's business. Like, you can call it shady and opaque, but I don't know if there's any pointing of fingers of anything actually illegal being done there. I think the much better comparison for Hyperliquid is BitMEX, which did get in trouble for violating the Bank Secrecy Act and not KY seeing their users and being just laissez-faire about users on their exchange. And they were an absolutely centralized exchange. And again, all of the laws that pointed towards BitMEX being illegal, I don't necessarily respect myself. I think those are bad laws that should go away.

• 48:20David Hoffman?

  But those would be the same laws that would be pointed to Hyperliquid. And so I'm not sure that the Tether versus Hyperliquid comparison is apt.

• 48:28Speaker 01

  Yeah, I think it's more just like having a dollar backing every dollar on chain kind of situation. Where like everyone always questions of like, if you're going to be doing this thing, this is how you should be doing it. If they claim that there's someone that has a dollar for every dollar, but they had not done any proof of reserves up to this point. Like, that was always the FUD that I had always seen. It's just like, look, the bot would go off on Twitter, where you'd see like, oh, Tether just printed 100 gajillion dollars. And it's just like, did you just get 100? Like, do you actually have that money?

• 48:54David Hoffman?

  1 trillion dollars printed at the Tether treasury.

• 48:59Speaker 01

  Yeah, so you would see that stuff. And like, is that illegal? Like, I don't know what their claims are or what the regulations are. But it's the same tactic, in my opinion. It's just something that's kind of like, okay, like, we're starting to get into a territory that's whatever, but it's undoubtedly been good for their network effects.

• 49:15David Hoffman?

  Let's get into the last topic of the week. PumpFun planning a $1 billion token sale coming in at $4 billion valuation. So this is a combination of an airdrop that I think has been more or less confirmed along with $1 billion of sales from private investors and then also sales on exchanges to retail investors, I think, at an ICO. I'm actually a little bit fuzzy on the mechanism. But this is the news that went around, the shot heard around the ecosystem. I think that the reactions to this have been mixed. This is obviously very pricey. So the individuals who are able to get in into this pump sale are coming in at a $4 billion valuation. So that's already priced in pretty well. Growth is already pretty priced in. But otherwise, like the exciting thing is that a pump token is confirmed.

• 50:00David Hoffman?

  And then a pump airdrop is like all but confirmed. And so it's a pretty big moment for this ecosystem. And then there are different takes, of course, as you would imagine. Some people are pointing at this being bullish. Some people are pointing at this being like, well, this is the end. This is the top. And then also other people are saying like, why do they need $1 billion for? And that, which is a whole other thing. I think the one, one thing of note is Pump is going for a like sitting shoulder to shoulder with some very big web two gargantuan's like Twitch. And it's going to try and be like a creator streaming platform that just has a token aside with it as well, more as like presented front and center. But it's interesting to see Pump, the, the long-term, the end game for Pump, trying to sit shoulder to shoulder with a streaming platform, which is interesting because they're

• 50:45David Hoffman?

  really leaning into like the creator economy side of things. John, what's your take when you saw this?

• 50:50Speaker 02

  The immediate reaction for myself, which was mostly a counter reaction to when people were on Twitter, I, I saw a lot of the stories at first were quite, a lot of the reactions at first were quite funny, saying this is extractive of, oh, they've been extracting for the past year or two, and now this is their final.

• 51:03David Hoffman?

  What do they need $1 billion for after they made $700 million in cumulative revenue? Like that was a big reaction.

• 51:08Speaker 02

  Yeah. It was just quite funny to me of crypto is the most, you know, we're supposed to be free markets people in the world. And then they will call it extraction unironically when you have the most successful consumer app in crypto, which users pay willingly to use, pay them money. And then they also sell a share in this profitable protocol openly at a, at a price that like anyone can participate in or not participate in. And that's extractive. So I, I don't think it's extractive. I, I understand that obviously a lot of people don't like meme coins. I mean, my view on this has been very consistent for a very long time of, I think people just really over intellectualize the hell out of meme coins. I don't think they're that complicated. They're fun. They're mostly a new form of gambling. Just like be direct about that. That's cool.

• 51:50Speaker 02

  Casinos are a real market in the real world. I mean, this is effectively the, I mean, do inter-det native on-chain casino as it stands right now. I mean, obviously also, hopefully this progresses into more real productive assets and stuff like that over time. But meme coins right now, that has product market fit, love it or hate it. Like, this is a, this is a protocol that has had serious product market fit over the last year, has generated a ton of money and like actually makes sense. And so just, I mean, like it's emblematic of that trend that we were talking about before again, of you know, what are the interesting areas in crypto of, you know, this progression from fat protocol thesis to fat application thesis? Obviously Solana and Pump are right in the middle of that, of that has been the hot chain and this has been the hot application

• 52:34Speaker 02

  for the past year or so. And where it's similar to Hyperliquid, where I think it's running a comparable revenue run rate to Hyperliquid over the past year, like quite consistently. Again, of, I think they generated something like $700 million over the past year, which is ballpark about like half of what Sol has been doing. So, I mean, obviously, anyone can do their own, like, look at the asset themselves, like everyone free to make their own interpretation. But it's not hard to see why people are like looking at Pump and interested in it as one of the very few incredibly successful applications that we have seen in crypto that has a lot of product market fit right now. And yeah, to that point of the, you know, going on and competing against a lot of Web2 incumbents, you can imagine that's where a lot of capital needs would come from. It is not cheap to go take

• 53:19Speaker 02

  on, you know, Twitch and Binance at the same time. You know, you can go look at what are the top streamer contracts? You can go look them up online. Like, they're gigantic. And they're very much aggressively going after this blend of this inevitable collision course between social and finance that is like very, very directly coming. And they are very much right in the center of that, trying to build out this social and streaming platform, really owning the user, and then financializing all of that and having the trading infrastructure around that. That's a very big vision. It's a very expensive vision to build out, which they've done a very good job at over the past year. So it's understandable what they could use the funds for.

• 53:54Speaker 01

  You guys have $100 to allocate at Pump at $4 billion or Hype at $40 billion? How do you allocate that $100?

• 54:03David Hoffman?

  Oh, all into Pump. 10x cheaper, all into Pump, for sure. I don't think, I think Hype can do a 2x or 3x.

• 54:12Speaker 01

  Kobe was calling for 150 today.

• 54:14David Hoffman?

  Kobe was what?

• 54:15Speaker 01

  Called for 150 hype. He's like, I think 120 to 150 makes sense, but I don't know when or how it gets there.

• 54:21David Hoffman?

  Kobe's very long hype. That is a Forex. That's a Forex. And so I think at Kobe's size, like Forexing is pretty good. But like Pump, if I've only got a hundred dollars, like I'm throwing it on the smallest market cap thing possible. And a four billion dollars, that seems fine. And a fresh new chart, you know? John, what would you do?

• 54:42Speaker 02

  No opinion, no investment advice. Everyone, everyone do what they please with their own money. I think both are great, successful applications. Like I understand the investment case that people are making for both of them. I mean, the very simple thing that you could do is go look at what are the big moneymakers in crypto over the past year or two? It's these two protocols, head and shoulders above everyone else at the application level. It's Sol and then maybe it's like Tron and then you take basically a big leap down at that point. And then you have like Ethereum and Sky and a number of these other protocols that are great, but I mean.

• 55:14David Hoffman?

  And even a lot of Solana's revenue came downstream of Pump is because of.

• 55:18Speaker 02

  Yeah. If you look at the correlation, if you look back, I've seen people post charts about this. If you just look at the correlation of pump fee revenue over time and Sol REV over time, they're very, very highly correlated, which is unsurprising. And so I think that's the interesting comparison too, that a lot of people will make is in many ways, obviously Solana is, at least at this stage, highly reliant upon a lot of speculative trading, a lot of meme coin activity. And in many ways, this is the clearer value expression of, you know, hey, I think that meme coin activity is a real thing. I think that this is a, you know, a actual sustainable application that people like to use. What is the right level to express that view?

• 56:00Speaker 02

  And Pump on and Solana are obviously the two different layers of that, the application versus the platform layer. I think that's a very interesting comparison that you're going to see a lot of people making. And obviously you've seen a lot of people speculating also over the past few days, you know, hey, is this why Sol is underperforming lately? If you know, are people taking that view very literally where are people going to get capital from to put this in? You know, you could imagine a portion of that is going to be people who are selling Sol. It's a lot of the same audience. It's this very fat protocol thesis to fat application thesis trend that we're starting to play out here where people are getting very interested in the applications that generate a lot of money again.

• 56:33David Hoffman?

  John, Brad, it's been another week. Really appreciate you guys coming on and giving your thoughts. I always learn a lot.

• 56:38Speaker 01

  Thanks, dude.

• 56:40David Hoffman?

  Bankless Nation, you guys know the deal. Crypto is risky. You can lose what you put in, but nonetheless, we are here in the West. This is Frontier. It's not for everyone, but we are glad you are with us on the Bankless journey. Thanks a lot.