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UNDER EXPOSED EP 19
Recorded: April 1, 2025 Duration: 1:08:06Space Recording
Short Summary
Key developments include the launch of the American Bitcoin mining company by the Trump family, the upcoming Token Generation Event for Wallet Connect's WCT token, and Circle's potential IPO. The stablecoin market is experiencing significant growth, with USDC's market cap reaching $60 billion. Regulatory updates include the FDIC allowing banks to conduct crypto transactions without prior approval. The potential for tokenizing private companies represents a significant innovation in blockchain technology. However, the meme coin market and several tokens on Binance are experiencing declines.
Full Transcription
We'll be right back. All right, GM, everyone, and welcome to episode 19 of Underexposed, our weekly macro show hitting all the biggest topics
in print, in crypto, and web3. Today, folks, today is Tuesday, April 1st. It is April Fool's Day,
the single worst day of the year to be on X with a timeline full of bad jokes, full of fake news. But
maybe it's timely as tomorrow is Liberation Day and we will find out if Trump's master
plan is going to liberate us from all of our capital gains or not. We're going to get into
it on today's show. I'm your host, Tyler D. I've got my co-hosts in the house. First up, D's art collector, coin stacker, and trader, mask connoisseur, April Fool's not an enjoyer.
D's GM, how are you doing today?
GM, staying off the timeline after reading a dozen stupid tweets and trying to stay positive.
The best part of my day was my morning because people hadn't really gotten into the April Fool's Day thing yet.
There was actual real content.
And then around 7 a.m. Central, it all started.
And it has not stopped.
And people just said, they really do this every single year.
It is a very rough day to be on X or Crypto X.
But thank you for joining us despite the April Fool's Day pain. Folks,
we've also got Peter James on with us, a plus Eve expert, founder of several companies. Peter,
Jim, how are you doing? I'm doing well. Just hanging in,
watching the markets, a bunch of different stuff going on in the sports world. So it's an exciting
time of the year and we've had some good weather. Not anymore here in Colorado, but got some good golf in last week.
And, yeah, stoked to be with you boys.
Nice.
How has March Madness been going for you?
Did you predict the four-point seats?
March Madness has gone broadly well.
I didn't do any brackets or Calcutta's this year, but we've been betting it.
And it started off pretty hot, then cooled down,
and then recently has gone decently well.
So I think a positive return thus far, but nothing crazy.
Nice to hear.
In hindsight, it feels like it was obvious this was the year that the top dogs would carry it forward.
But I didn't predict it.
So not as great for me.
Folks, we've got Jeeves on with us as well.
He's an early stage crypto VC,
dabbles in internet capital markets,
wears a lot of hats,
just penned a nice new essay
that we're going to get into later on the show.
Jeeves, GM, how are you doing?
GM, GM, I'm doing great.
I'm in the same boat as D's,
avoiding X today, no bird app,
just trying to focus on tomorrow.
You know, figure out what's going to happen, the uncertainty
around it all.
Are we going to have more or less certainty tomorrow?
That is the billion-dollar question.
We're going to get into it on today's show, folks, plus a lot more.
Before we do, today's show is powered by Wallet Connect.
Wallet Connect is the connectivity network shaping the future of on-chain UX. If you've connected to a Web3 app, you've seen Wallet Connect. Wallet Connect is the connectivity network shaping the future of
on-chain UX. If you've connected to a Web3 app, you've seen Wallet Connect. That blue logo,
it's everywhere. An icon of trust in crypto, as recognizable as Visa at the checkout. If you want
to learn more, follow at Wallet Connect on X and Telegram to stay ahead of what's next.
And folks, more big news out of Wallet Connect in the past week.
Last week, we talked about that vote.
The vote tally is in.
Transferability is coming to that Wallet Connect WCT token.
Over 12,000 wallets voted.
Final tally was 99.65% yes votes
versus a very tiny percent of folks voting no on that. So in April, the WCT transferability
unlocks a new chapter for the Walt Connect network, eco, and on-chain economy. It's effectively
their TGE. And this month has seen some pretty great TGEs highlighted by that Walrus token drop
last week. Godzilla yesterday was pretty solid.
So perhaps a nice market backdrop for that.
So we will be on the lookout.
Shout out to Wallet Connect as always.
Before we get started, quick disclosure.
The opinions expressed on this podcast are those of the speakers and do not reflect the
views or opinions of any organizations they are associated with.
We are here to share insights, provoke thought, and maybe even stir some debate.
But this is not, and I repeat, not financial advice. While we talk about markets, investments,
and trends, remember your financial decisions should be made with the help of your own research
or with advice from a licensed professional. All right, well now let's get into our topics
for today. I'm going to fire up the screen share for those in the stream. We'll get that stream
link pushed out here in just a second as well. Starting with macro, a lot of big macro headlines
from the week. The biggest one, Liberation Day, the tariffs, we're going to finally get
hopefully some clarity around that tomorrow. Trump is going to be delivering remarks in the
Rose Garden at 4 p.m. Eastern. I think the Trump administration has built this up to be such a big
day. So expectations are high for this one. And we've seen markets start to rally here today
ahead of what will be likely a very volatile day. This comes after a volatile weekend. We had Trump talking about a third term,
bombing Iran, angry at Putin, talking about more tariffs. So it was quite the Sunday.
Led to a sell-off. We've had a bit of recovery, effectively just ongoing chop. This also comes after what was the worst quarter for U.S. stocks compared to the rest of the world in 23 years.
So it may have felt bad in the moment.
I don't know if we knew it was quite that bad.
23-year worst quarter.
So hopefully we can rebound here.
During that gold hitting new all-time highs, outperforming Bitcoin,
that digital gold thesis.
Is it still valid?
We had OpenAI, huge news yesterday.
Biggest private fundraise ever for a tech company, $40 billion at a $300 billion valuation.
So that was a huge headline.
That comes just a few days after the O4 model was
widely released. People may know it for Ghibli and the image generator, but it can do quite a
bit more. And it was a very strong model update there. So that's the macro backdrop in crypto.
A few different headlines. We have Strategy, Mara, and GameStop all announcing big Bitcoin buys.
We've got a stablecoin bill moving through Congress.
Fidelity is testing their own stablecoin.
Circle looks like it's going to IPO.
That might be one of the biggest stories of this month.
The FDIC giving banks the green light to start conducting transactions in crypto without prior approval.
And then the Trumps getting deeper and deeper into crypto.
This is news that came out Monday.
They have effectively formed, invested and formed a new Bitcoin mining company called American Bitcoin.
They look to make crypto great again in the United States. But we've already started to see some pushback in Congress as Trump and family continues
to get deeper.
And it's making all the pro-crypto policy get a little murkier.
So that's the backdrop.
There's a lot of headlines.
Bitcoin, 85,300.
It's up about 4% from Sunday lows.
It's down 3% on the week. Ethan, 19, 20, down 7%.
Solana, 127, down 13% of the week. Dang, I guess it was around 140 or so when we were doing the
show just last week. Last week, people were leaning bullish. Then everyone got extremely bearish.
Maybe we'll find out tomorrow. Peter, I'll toss it to you. There's a lot of directions we could
take the conversation. I think starting more pure macro, what's your outlook here? Do you feel like we're going to be out of the woods tomorrow? What are you looking for from Trump on Liberation Day here?
continues. That's the one thing I have conviction in, and I think we're going to continue to have
that. I do think the market is looking for more certainty, and we'll see what transpires tomorrow,
but my guess is we're not going to get like, it's not going to crystallize in terms of
here's the tariffs, and this is how it's going to be going forward. This is the playing field.
I think we'll continue to see impulsive decisions from Trump.
I think the administration will continue to try to maneuver. There's a lot of negotiation and just different hands being played across the world. So the theme that I think will continue
for this year is piercing volatility. And that certainly is going to impact one of the more risk
on asset classes, which is crypto, which is what we're most focused on here and the show.
So kind of the same themes, gold just marching up into the right.
That is a trade that I think broadly highlights just kind of the uncertainty and where capital
wants to flow when there's so much uncertainty.
So that kind of continues.
Happy to see Bitcoin broadly have relative strength in some ways. I think we're all
really excited about the narrative around Bitcoin and just how it's performing relative to the rest
of the crypto market. I think yesterday it reached kind of a new all-time high in terms
of Bitcoin dominance. I'm not sure exactly where we are at this exact moment in time.
I imagine that's kind of retraced a bit, but that's not that surprising to me.
And I think from a risk reward perspective, we've talked about just how Bitcoin continues to outperform.
And then, you know, equities and everything else.
It's super hard and there's just so many cross currents
and there's a lot of different perspectives. I don't have any conviction broadly where things
are going outside of expecting more volatility in the short term. So it's a tricky time to be
an investor. There's a lot of uncertainty across the board and we'll see what happens tomorrow.
So you're not expecting us to get out of the woods
tomorrow but by any means i'm expecting some clarity on certain things and then more uncertainty and i just like we've been really excited really scared i mean just think about how many times in
the timeline it's been some form of euphoria and some form of just peak fear and it's all over i mean how many times does that
happen this year feels like it's every week yeah i i don't expect that to change in a big way
anytime soon uh without this administration's behaving yeah i think that's a fair take jeeves
i'll toss it to you what what are your expectations for tomorrow? And maybe part two, what would be the
bull case? What would be an optimal outcome for us? Yeah. Yeah. So I think what I'm expecting is,
we started off in this threat phase where Trump's clearly been sort of threatening and beginning
negotiations over the past, where it's been like months to months with various countries.
It's been like months, two months with various countries.
I'm expecting tomorrow we enter into the negotiation phase.
So what I'm expecting is Trump to start is going to set baseline tariffs across the board.
I'm anticipating that he's going to highlight all of the countries that have come to the
negotiation table with the U.S. and have chosen to play ball with us.
And he's going to use those
as primary examples of what he's expecting from other countries. From there, at least we'll have,
I think, some level of certainty. Right now, we know absolutely nothing, right? Trump clearly
has a plan. He's even saying like he's holding the cards close to him right now. And markets
just hate uncertainty. That's why we're
seeing gold other assets go up, like Peter mentioned. I think over time, we're just going
to at least get more certainty or at least start to see what the Trump administration is thinking
toward tariffs. So anyway, long story short, I think that we enter this phase now where we begin
negotiating with countries over certain tariffs, whether they be reciprocal or whether they be
really targeted at specific industries. The bull case, Tyler, is just certainty at this point.
It's going from like, if there's a scale of uncertainty to certainty, it's getting closer
to understanding what's the game plan here and how can companies, investors, and people plan ahead
in this environment right now? Because I think
even if we get some certainty and it's negative, I think that's a general positive outcome.
Yeah, I think I would tend to agree. We were chatting a bit about it on FOMO Hour this morning,
and Mando's perspective is, I think Trump's going to kind of come out with worst case scenario, like the highest
the tariffs may ultimately be, and then perhaps use those as negotiation tactic, put them all on
the table, and then effectively start to walk back from there. I thought that was an interesting
outcome. I think that could line up with the potential negotiation strategy that we've seen from him.
And I think I'm with you that any level of certainty we get is going to be seen as positive.
And we also had Powell Mountain say that basically
they priced in the worst.
So if it's any outcome besides the worst,
that seems like it would be a positive.
Yeah, exactly.
I don't know necessarily that he walks things back
more that he tries to find common ground with folks he doesn't strike me as the kind of person
that's going to to make open threats and then fully just retrace them i think it's still going
to be open and persistent until there's some type of um you know advantageous situation or at least slightly advantageous situation
yeah that makes sense deece any thoughts on your side how are you feeling are you ready to be
liberated tomorrow what are your expectations i'm just tired of winning tyler i've done so much
winning that i'm tired of it and i would like to stop winning So this is my plea to president Trump. Can we stop winning?
Yeah.
I think many,
I have very low expectations.
Yeah,
that's fair.
I feel like I would have had lower expectations for this day. And then he's,
he's done such a job of building it up.
And as,
as a talking head and someone who,
who comes out and comes up with narratives and talks about it on a daily basis.
I've built up these expectations for tomorrow
that are probably going to be let down to a degree.
We'll see, folks.
4 p.m. Eastern tomorrow, live from the Rose Garden.
So it's going to be a very big day.
Hey, Peter, coming back to-
I thought it was actually 3 p.m because there's a
one hour open market
the last tweet i have from bloomberg trump to deliver remarks in rose garden at 4 p.m on
wednesday getting it to four okay bloomberg this morning was saying it was at three basically
saying like hey there would be an hour of market activity where this could all just be traded, which I think would be hilarious.
It would be.
I was actually disappointed with the 4 p.m. time
because we won't see the true stock market reaction
at least until the next day.
The crypto reaction, right?
It won't have the crypto reaction.
So it'll be the first asset class
to see how folks are feeling here.
So expect volatility.
Peter, one of the other macro headlines from the week is this poor U.S. stock performance against the rest of the world.
I'm curious if you make anything of this.
Is it a cause for concern, just how you might be reading into this headline?
It's absolutely a big cause for concern. You know, as an American citizen, you know, generally,
I think the most attractive thing about the U.S. is that we're the home for capitalism and
entrepreneurship and we have market integrity and that's super important. And so capital in general has felt best kind of being, you know,
within the US. And if you look at like kind of the last five to 10 years, especially the last five,
a ton of capitals just hung out kind of in this mag seven. So we saw a big rotation
out of those companies and into the rest of the world. China is really trying to be stimulative.
They had meetings with a lot of the top entrepreneurs.
They're trying to say that, hey, we are a place where people can build great businesses.
We'll see.
Obviously, it's tough to trust a communistic country, but certainly they got people going back there to build and more capital flowing into their markets.
Same thing in Europe, which I don't know if I could be bullish on Europe long term. There's certainly more qualified people than me to talk about kind of the overall macro around the world. But a lot of capital flu came out of the US stock market
into other markets. And if you want to go really deep down the rabbit hole, you can listen to like
Ray Dalio and other people around the fourth turning uh there's a lot of concern and skepticism we even saw that yesterday
that uh you know the us is at risk of losing the world reserve currency um you just look at the gdp
of bricks versus uh the us and our allies uh that trend is not going in our favor so there's a lot
of concerns and um you know, Trump is really trying
to renegotiate and use tariffs against a lot of, you know, our adversaries. And one of the
challenges is that those adversaries hold a lot of our debt. So there's so many different things
going on right now. And that's why it's really tough to evaluate. There's a ton of cross currents
and we'll see. The thing that gives me the most optimism is that we have guys like Bessent, you know, as the treasury who is as sharp as they come.
And, you know, there's still a ton of unbelievable entrepreneurs and the best companies in the world are still here in the U.S.
But there's definitely more concerns than we've had in the past.
And certainly I think a lot of people are expecting, you know, more of a Trump 1.0
administration than what we've had.
And I do think that the intentions are good.
And I do think we need a real shakeup given where our debt's at.
It's not sustainable, especially when you look at the interest payments.
And I do think, you know, as much uncertainty as there's been and a lot of like the challenges
and just being in crypto and in the markets, the prices go down is not fun the one chart that does look good
and what best has said is the number one chart is the 10-year treasury last i saw is like 4.16 or so
maybe it's ticking up right now yeah that's been the marker that he wants to go down and that makes
sense when you're trying to refinance your debt so all this
pain uh in this detox period which he said was coming uh is in an effort to lower this this
number and that has come down so that'd be another positive to point to but again kind of rambled
there ton of different cross currents ton of things to be concerned about and then there's
some things to be optimistic about as well the The 10 years, effectively it's lowest since we've been doing the show.
So it briefly wicked down on December 5th,
it hit this level,
but then shot straight back up,
peaked at four,
seven,
four,
four,
eight.
So it's down 15%,
17% from that peak. And basically right around when Trump got inaugurated.
So it's been pretty steadily coming down.
I mean, if you look at the pattern, it looks like a head and shoulders,
kind of typical setup.
So it looks like it is ripe to come down.
I appreciate your thoughts on the macro.
I think there's more and louder kind of doomer takes out there.
The rise of China, acceptism, decline of America.
I'm not in that camp, but I think there is some very clear data about where the U.S. is lagging in areas like manufacturing.
And as we get into like a robotics dominated world, robotics plus AI,
that feels like it's going to be very, very important. So I am hoping that perhaps one of
the outcomes of the tariffs is it brings back more onshore manufacturing for the US. And it
seems like that's an area that we absolutely need to focus on. So those are my global macro thoughts.
We can dial it back more into crypto here now that we've started kind of going down that path.
But it is an important backdrop, and everything is so tied together at this point.
I think Stats, a good friend of the show, just tweeted out that the price of Bitcoin trading more correlated with Tesla stock than it is
with,
with gold and more correlated with Tesla than even the S and P or the NASDAQ.
So it is important to,
to cover how these things,
these other macro assets are trading as we look at our,
our crypto bags here,
maybe coming back to the Circle IPO,
I feel like this is one of the biggest stories of April here.
So we got the news yesterday.
Circle has hired some bankers.
It looks like they're pushing forward with a potential IPO
as soon as this month.
And geez, maybe I'll toss this one to you.
I think we've been talking about stable coins.
We've been talking about real world assets for weeks on this show.
Everyone wants to know, how do you bet on stable coins?
Is this our answer?
Are we loading up for the circle?
If you have access to private markets, yeah.
I mean, obviously when they go public, it'll be a bit different.
But I think the opportunity to buy this at a decent price has been over the past six to 12 months on private markets when it was valued between $2.5 and $4 billion.
Is a stablecoin issuer worth $4 to $5 billion is the question.
What do you think?
I think there's going to be a lot of competition in the stable coin space.
It's clear that Circle has a lead as the institutional and sort of the gold standard
for a stable coin. I think you can make the argument that USDC is the trusted
company, especially when it comes to money movement. I've thrown this stat out before.
There's three times the amount of tether than there is USDC, but there's three times the
amount of USDC movement than there is tether. So it punches way above its weight. I think that
shows that USDC is a very desirable asset for money transfer and movement.
When I'm personally accepting stablecoins, I only want USDC.
A lot of companies that we work with oftentimes just want USDC.
Tether is often used for trading pairs for a lot of folks.
With all that said, there's a lot of competition in the stablecoin market.
And USDC and Tether don't currently pass
yield onto users. And I think we're seeing different folks come out and say like,
you're effectively going to have to pass yield onto users to remain competitive in this space.
And I've made this call before. Initially, I said there would be 50 stablecoins this year.
I think there'll be 100 plus stablecoins this year. I think it's the year that we continually see more and more folks issue them. Athena is clearly leading the way on how you take an off-chain, sort of off-chain, on-chain strategy, pass the yield back onto users. We have some folks that are working on issuing stablecoins. And I think that large financial institutions are going to start to issue stable coins as well this year.
So I think this is just going to become a very, very, very competitive space.
Interesting. So you're viewing that effectively as a bear case is what I'm reading into your tone.
I think it's going to be tough, right? It maybe gets nominated by like five to 10 different players.
But at the end of the day, you know, we'll circle be one of those probably. Right. But I think that
there's just going to be a lot of competition in this space over the next year to two years.
I think that'll hurt a chair price initially. And I think they'll have to figure out how to
innovate, release more products and continue to hold that King of the Hill status.
We were trying to do some of the back of the napkin math on Fumble this morning.
Do you have any line of sight?
So they've got, so USDC $60 billion market cap token.
Do we know, and I don't on the top of my head,
any of like how they monetize that.
I think Mando was trying to do like four percent that they would be able to pull back
on usdc with 60 billion that's some pretty significant revenue right there so i guess
when i was looking at it on paper four to five billion seemed pretty cheap
just looking at this growth i mean it's up usdc is up 150% since December 23rd.
This is issuance right here?
Their overall market cap.
So yeah, USDC issuance on chain is up to $60 billion.
Yeah.
Look, it's a great business, right?
But if we continue to move rates down, which is the government's plan,
this business deteriorates over time, especially if we get rates move rates down which is the government's plan this business
deteriorates over time especially if we get rates down and they stay low that four percent goes down
to three percent that three percent maybe goes down to maybe two and a half like we're not going
to see zirp again but that business ends up deteriorating slightly over time and then with
increased competition they effectively would have to pull some of that back.
Two and a half percent is almost impossible.
Not impossible.
I think the odds of that are under 1%.
Like inflation is just not going to get, I mean, I guess that's a bad comment.
If we get a massive deflationary force with ai that's what that would be the case and that that is i guess more probable than i'm giving it giving it right now but it's not zero
for sure but i think three percent is definitely within the wheelhouse for sure it really comes
down to what inflation is going to be right like that you if you want if you have a two percent
10 year two and a half percent tenure you need inflation effectively at zero or just under 1%.
That world's really hard to see right now.
It's hard to see right now.
And I immediately regret saying that it's a super low probability because historically, what has brought the biggest deflationary force is technology.
And we could be in a golden age of like, you know,
a new technology renaissance with AI.
So I retract that statement, but either way.
Yeah.
Yeah.
Point is just as rates go down, their business deteriorates.
That is, that effectively is their spread on it.
Right.
So I think increased competition in that.
I wouldn't bet against Circle by any means.
But yeah, I don't know that I'm going to be a buyer day one.
I think I might be a buyer day one.
I feel like this could be a scenario where the narrative play could be stronger than some of the fundamentals.
I think you've outlined some real fundamental risks to their forward-looking
growth,
but the ability to bet on the stable coin company,
one of the absolute leaders,
top dogs,
top two,
when that hasn't really been an option for most people,
I think that's pretty enticing.
And I could see that catching hold.
Have you, so this is tradable in the private secondary markets right now?
James, have you taken a look at that? Is that something that someone like me has access to,
or do you have to be part of a certain company and you have to have certain credentials?
Yeah, yeah.
So this gets traded with secondary brokers.
So along with other private companies that are looking to,
usually it's going to be done via folks
that have a position in Circle
and want to exit that position via these markets.
So they would say,
hey, I want to sell a 500K
up to like $10 million tranche at this valuation.
And they'll effectively go put that ask out.
On the other side of it, there's going to be some bids maybe at $4 billion, whatever it may be at.
So you're going to see both sides of it.
This is all done via private brokers.
There are no public markets for this.
And just with our business, I encounter these a lot so the latest I'd seen I think was around 5 billion on second on secondary
markets okay that lines up with the the coin desk article saying they're going to launch somewhere
four to five which I don't know it still feels a little it felt a little low to me but yeah walk me through
what were the numbers vando pointed out he was like saying four percent on the current total
issuance yeah and he he was on the on the gun there so just i'd say take it all the grain of
salt um just kind of spur of the moment conversation, but taking a look at 4% on 60 billion
with likely some expectations of growth
because it does look like it's
on a pretty clear upward trajectory.
While he's doing that, Deez,
I'm curious for your thoughts
if you dabble much in individual stocks or IPOs,
if this is something that would be on your radar or not.
I really only own index funds, but 5 billion does seem cheap, all things considered to me at least.
And I'm basing that probably more off of crypto market caps than I am actual stock market cap,
so that could be a bad comp. But I mean, 5 billion is cheaper than things like dot white coin bitcoin cash h bar shiba inu sui avex
um and i think circle is a more integral part of this ecosystem than all this
so i don't know if i'll dump index funds to buy it or transfer money in, but 5 billion doesn't seem that outrageously priced at all.
I guess I should be looking here at stock market caps
and come up with some different comps there.
But it seems pretty solid to me.
I feel like they're going to have more...
Jeebs outlined a lot of things about competition,
but for me, when I hold stables on chain they're
about the only stable i ever really hold um i've held tether here and there for a little bit when
yields are dramatically higher on a lending platform but it's normally not the case um
so i feel like they're kind of like the more lindy trustworthy solution i guess some of the downsides
i think of when i think of circle were more related to how they act during times of um
like hacks and stuff like with north korea and like they they freeze funds very slowly or just
fail to act um which something that always is on the back of my mind is like not great um i would hope they
would be a little more quick to act the like the multi-million up to billion dollar hacks but
yeah feels feels relatively fairly priced like if i have to go to $5 billion stocks, I got to go way down this list.
So I'm still scrolling.
But I mean, there's so many stocks I haven't heard of that are worth like 50 plus billion.
So I'm not...
The comps aren't great for me.
The comp is 6 billion FTV right now.
Peter, I'm curious if you have a point of view on, on circles IPO.
Yeah, I'm actually poking around. So I'm pretty familiar with secondary markets.
And I guess this can lead us into another conversation as well, but having, you know, been a part of some big private companies early on like draft Kings and you know,
action at work and now underdog I've seen transactions happen on the secondary market for these, you know, more Network and now Underdog. I've seen transactions happen on the secondary market
for these, you know, more mature private companies.
And I think there's been a lot of action.
We saw the OpenAI raise.
There's also things like Figure
and there's a variety of these companies, Stripe,
that are getting a lot of demand in the secondary market
and broadly, it's employees or maybe early angel investors
that want liquidity.
And then there's of course buyers ahead of the IPO
that are interested in buying broadly at a discount
unless it's a super oversubscribed round.
So I'm gonna poke around on Circle.
I imagine a lot of these secondary markets
that I know people at probably have some access to it.
So I'm going to look into it.
I do think one of the coolest use cases for crypto, and Vlad actually talked about this on the most recent Bankless podcast, is having tokenized, basically tokenizing these big private companies and then having a marketplace for them.
I think that could happen on chain or it could happen on a platform like Robinhood.
And to me, that's a really great use case for blockchain technology.
And I would love to see that.
And it's solving a big problem because right now you're paying these platforms quite a bit,
a healthy percentage to facilitate a transaction between
an equity holder, whether it be an employee, an angel investor, or whoever owns, you know,
stock in these private companies and the buyer. And if there is a, you know, open marketplace for
that, it'd be really exciting. I'm sure some of you guys have used Carta in the past. You know,
I've done a lot of investing and have things on Carta.
And I initially thought Carta was kind of in the lead
in terms of being able to become that marketplace.
Fortunately, they made some blunders
and that's not gonna be the case.
But now I'm hopeful and optimistic
that we see this come on chain.
And I do think it's one of the best examples
and would be a huge value creation for society if we had a buzzing marketplace for these secondary transactions.
And I know, Jeebs, you've looked into this, so I definitely want to kick it to you. And I know
you're also super bullish on Robinhood like I am. What's your view? And have you listened to that
Bankless podcast yet? No, I haven't. I saw he was on Milk Road road too so it looks like he's doing the rounds
um go go back to circle real quick so i'm seeing around like mid to late january it looks like
folks are selling at four or five in february like mid to late february there was bids at five five
and then tyler maybe maybe you're changing my mind a little bit here. I'm doing some of the
back of the napkin math, trying to figure out some of the numbers here. So it looks like the revenue
is likely someplace in between 1.25 billion all the way up to $2.4 billion per year.
If so, most companies that fall into this general sector end up getting someplace
between, let's call it like a 8 and 12X revenue. So we could be looking at like a 12 to $18
billion valuation. So four to five, day one, we are seeing bullish IPOs right now. Tyler,
you're getting me bulled up here. Bullish circle. 2x play was my target at 5 billion.
It felt like I wasn't like a 10x moonshot by any means,
but it feels like something that could 2 to 3x.
I think there was some thought around.
We were bullish on fart coin at 2.5 billion.
We probably should be bullish on circle at 5.
Yes.
I would agree with something tells me that the valuation
coindesk is reporting is off though if i'm seeing bids at five five and they're saying it's going
to launch four or five four to five i i think that those numbers just seem off like i could
see it coming out eight to ten easily if these numbers are all right yeah i think that's the
problem with this so they are
i think they're looking at old numbers i think they're even kind of acknowledging that so
it would be a gift if it comes out that low but it's probably gonna come out eight to ten
there it's a little less interesting i still think it is i think you still have the 50
to 100 upside but a little bit riskier at 10.
Certainly.
Decent for stocks.
Are we jaded because of our tokens?
You're like...
I'm not that jaded.
I think we saw Newsweek have a very,
a massively successful IPO yesterday.
It's up 10x.
We had CoreWeave is now up. If tokenized private
credit was on chain and you could readily invest in these companies, would you be a buyer of open
AI at $300 billion? Maybe I'll toss it to you and happy to go around the horn on this.
jeebs maybe i'll toss it to you and have it to go around the horn on this
maybe yeah you know so i wrote this piece about rwas yesterday where i think like the whole rwa
sector is in its web 1.0 moment meaning um there's a lot of web 2 companies that already exist that
do this stuff even you know the journal ran a spread yesterday and even had a podcast on this
where if you're an accredited investor you can get access to a lot of these private companies do this stuff. Even the journal ran a spread yesterday and even had a podcast on this where
if you're an accredited investor, you can get access to a lot of these private companies by
going on these platforms, providing bids and actually getting a piece of them. Crypto isn't
needed here. So when I say it's in its 1.0 moment, what I'm saying is the first forms of the internet,
we were taking books, magazines, other forms of media,
and just bringing it onto the internet. Sure, there's efficiencies gained, I no longer have to
go to the library, I no longer have to go to the bookstore, I can just go on the internet and get
access to this information. It wasn't until we saw like the web 2.0 moment where we moved to
read, write, you know, as Chris Dixon goes over in his book, Read-Write Own, that we had
this really major breakthrough. So you saw examples like Encyclopedia Britannica move to Wikipedia,
and Wikipedia basically became that online version where everyone could contribute to this
information. I think RWAs are in a similar state where we're basically taking things that already exist off chain and
we're just using crypto rails so you gain some efficiencies right there's basically three stages
that i discuss here one is around uh capital formation for rwas so this is we have this deal
we need to call capital from lps to make the investments. I think that can drastically
become more efficient via smart contracts and stable coins. Right now, the process is an
absolute nightmare. It's wires. It's a lot of counterparties. Jennings and I have a friend who
works at one of the larger PE houses. He gave me these examples of just how much work it is.
It's a lot of its
manual right now to call the capital. The second component, which I think is less experimented with
right now, but it's part of what we're talking about is the actual investment opportunity and
tokenizing that. So whether it be private equity, private credit, it could be...
uh private credit um it could be
oh did we lose him i think we lost him i think we lost him i thought it was me at first
i thought he was holding us on for that third that third big item but a very insightful walk through
here of how tokenized assets effectively all of web 3 can evolve and how early it is and
right now basically to summarize this thesis we're starting to put these assets on chain we're
effectively duplicating traditional finance but then once traditional finance the the building
blocks are in place that's where you can really start to create new types of products.
And I am curious where he thinks that is going to go. And of course, solving some of the web
two issues is going to be probably low hanging fruit, right? Like lower fees, easier global
payment remittances. You know, there's a lot of things that that jump out um and it's interesting that private credit
has been one of the the first sectors to really catch fire in the rwa space i don't know that i
would have predicted that jeeps looks like we've got you back sorry about that guys and you left
us hanging you were just about to drop the third big one.
Yeah. So I think I was saying like capital formation, tokenizing the actual asset, which really could be good or bad.
I think if you're providing additional liquidity to what were traditionally private opaque assets, I think there's benefits and there's downsides. Matt Levine talks about
this all the time. And then the third side of it would be the actual distribution. So the
investment has paid out, there's yield. We need to then distribute that out to people. And I think,
I mean, there's huge efficiencies there from smart contracts, right? Hey, I deposit these funds,
automatically go and sort of send this out to folks, provide them with statements,
et cetera. So less manual components required there as well. So I think that's what I was
getting at with all this is that is like the web sort of 1.0 moment. But I think the true
evolution of RWAs and the efficiencies that'll really be gained are when you can start to use money Legos.
You can start to incorporate these products into DeFi, lever them up really easily, and then create
a programmatic portfolio of all these different asset classes. Mostly because you don't need
blockchain to get access to these deals. There's tons of private companies in the Web2 world trying to figure this all out. But what they don't have is the DeFi component. That's a whole other topic because
you know, these folks really won't be able to go counteract on Aave or Uniswap. We'll actually
need institutional level products for these ones that have sort of KYC, AML. You know, they're going to have to know who
their counterparty is, or at least generally know that their counterparty is not North Korea on the
other side. So I think there's a lot to it. I think it's in its really early days, I'm talking
with a company who's tokenizing equity and professional sports teams, and then also debt for
stadiums. And I think it's really
interesting, right? The debt on this will probably pay between 4% and 6% for a stadium.
But let's say you're a fan of whoever, the Bulls, for example, and they want to build a new arena,
you have the opportunity to help finance that. And then you'd receive 46% on that. And you as
a Bulls fan are inclined to want to keep that over time. There will you'd receive, you know, 46% on that. And you as a Bulls fan are
inclined to want to keep that over time. There will be tradable markets on it. Likely Pendle
would pick something like that up to have then yield trading markets on it. The other side of
it is they're working with a number of professional soccer clubs in Europe for just equity rounds.
Hey, we want fans to be a part ownership in our teams and they want to sell like 10% ownership
to have a liquidity event for the owners, but also to allow the fans to be part of the experience
and ownership with them. And what you're saying is even further, taking a step further, let's say
I have $10,000 in Bulls Arena debt, I can just go throw that in Aave and maybe get 50% back.
You'd have everyone with it.
Yeah, exactly.
It's open and tradable at that point.
It's a huge unlock.
I agree.
It feels like, again,
we're probably monseers away
from really starting to see that come to fruition,
but it's definitely probably one of the
probably more important storylines and
sectors to watch. So I appreciate you being here.
Definitely. Yeah.
I'm less bullish on sort of the stocks, commodities,
other stuff and more bullish on niche,
niche private assets that,
that currently don't have a lot of liquidity associated to them.
Cause those ones are the ones where you can effectively leapfrog
the existing financial infrastructure
and create new markets and financial instruments via crypto.
Very interesting.
So I want to thank you for sharing your essay, folks.
You can check it out, magicairnetmoney.beehive.com,
the Web 1 era of RWAs.
I think you shared it on X yesterday as well, Jeeves, so you can find it out magic air net money.beehive.com the web one era of rwas i think you shared it on x yesterday as well jeebs so you can find it on his twitter we've got about 10
minutes left so i think we've hit the heavy macro topics really appreciate our discussion maybe we
go a little left curve for for a bit here and and diesel i'll tag you in to to start the the convo
I'll tag you in to
start the convo.
We've got the Farccoin chart pulled up.
Is it
the best chart in crypto
right now? Is it a leading indicator?
Cup and handle looks awfully
nice. How are you feeling
about this? It looks good.
I feel like I don't have enough.
Talked about it a couple weeks ago.
Bought a little bit when it was
25 cents or whatever. Haven't sold it yet. Just holding it to see what happens. But I feel like if any of the tokens that came out in Q4 of last year, you know, have another run in it, has to be Fartcoin.
the 20 iq take of it if you just think about every token you've heard about that's brand like you know
three to six months old in that span are there any that have more mind share and uh better
distribution than fart coin and i'm not really sure if there is so i'm still holding what i have
gonna see what happens not selling here but um it's definitely the the strongest meme bag i have
but it's definitely the strongest meme bag I have.
It has been a bit of a leading indicator.
So it flipped green on Sunday when the timeline was in full depression mode.
And then crypto ended up doing a bit of a rally on Monday.
And of course,
into today,
I think tomorrow's gonna be telling.
I'm very curious.
You think the hot air will be liberated?
Will it rise? It's one of the top questions on my
mind i can tell you that is fart coin an american-made cryptocurrency yes 100 it is yes
yeah a lot a lot of american farts in this one so we'll be watching this closely i'm curious
have you been following the rest of the meme coin market i tweeted about this every few days but it unless my list is just asked there's not much to get super excited about here
like you know mog has been pretty down bad um some of my ai meme shit coins have been down bad
um like obviously goats at 50 million looks absolutely dead um yeah i mean scrolling through
my list right now it's just not not inspiring is your list a little different than mine i
it's less about do you see what happened on finance today with shit like act
yeah i'll try to pull that up you pull up kobe's tweet you go to kobe's account he has
the charts of uh all the the tokens that ate shit it just there's some tiny bit of like funny irony
here in the sense that um a week ago hype was getting um bullshit for jelly jelly markets being exploited and there was a bunch
of rumors of like you know maybe binance even trying to push the exploitation i don't know
and then i wake up today and just see like nine tokens on binance all down 50 percent
um and i saw that kobe tweet i actually thought for sure that was an April Fool's tweet um was like
98% sure until I read the post about what happened and was like oh it was that that's
not April Fool's that's finance yeah I uh so I I had already started running the AI numbers of the
day so I'd seen that act was down like why is this down 50
what happened but then i then kobe tweeted i go oh wow so it looks like i think someone with ties
to winter me i don't know if someone who has traded through winter mute or yeah um looks like
the automated uh trading strategies that were meant to be profitable look to be wildly unprofitable.
Deasy, the tin hatter in me believes that Binance is forcing Hyperliquid's hand.
I mean, it's a competitive market and we're in the wild west, Jeeves.
I mean, dude, he did it to FTX.
Yep.
He's like, CZ's a gangster.
Do not underestimate that, man.
I think that he forced their hand.
And here's my tin hat theory.
By forcing Hyperliquid to effectively show its cards that it is actually a non-KYC, effectively centralized version of Binance, that puts them into a position of high legal risk in my eyes so i have this little tin
hat theory that like a lot of this was was staged and and on purpose and you now can see
um effectively other parties go after hyper liquid
these i'm curious how you're how you're feeling about hype we've talked about hype quite a bit on this
show uh we talked about it early when we were just getting started throughout the rally
through the downturn has your opinion on it changed much since the the jelly jelly exploit
and their response um not necessarily i'm normally not in the group of people that believe you know
code is law and that anything that's exploitable for profit is fair game um so i i didn't sell any
hype during the sell-off or anything um i guess i didn't buy more hype either i'm just holding the
position i have so i i would say i don't have a very uh changed opinion
on it i mean i do think it opens up a can of worms but i'd rather them address it early on
in the life cycle than like continuously get exploited i also just don't really think or
believe that we need access to leverage trade absolute liquid dog shit like as much as people
seem to want that i don't really feel like we need that um if you want to speculate on a liquid
dog shit it's there i don't really feel like you need to lever up on it um it's already leverage
dog shit as it is um so i'm still holding it i i would rather them do what they did than just like
get you know exploited and take on bad debt over and over again so
well i am curious about like are they starting to remove some of these other
low market cap shit coins to make sure this doesn't happen again
market cap shit coins to make sure this doesn't happen again even if they don't remove it and
just lower the max leverage right yeah like you can allow the trading of it but like do you really
need to take a 10x levered position or more on that stuff like i don't think so and so i think if they clean up a bit of their risk management
and some time passes i think they have shown that they're gonna do what they have to do to protect
hlp providers which i don't know if i think that's necessarily the best move or not because i read some posts from people smarter than me that
basically says like why would you market make on hype if you can just uh basically give hlp the
money and get the downside protection like if you're manually market making you don't get the
same downside protection that hlp people get so that lowers the competition uh in market making
on the site altogether which seems right uh from thinking about it through incentives but
that that was one thing i read on the timeline it felt a little insightful it was okay well if
they're gonna protect hlp at the cost of every other market maker, then why would those market makers,
you know, be super active?
They don't get downside protection that hype gets or HLP gets.
Yeah, I think that's a real risk.
So it's still early.
I am curious how they'll continue to respond.
I think it's holding this like 12 floor pretty well.
Even that day at dawn, I mean, mean it waked down got bought back up
and as the market went down it went down with it and seems to be at a local low here i think it
holds but who knows i mean i'm just i've kind of just holding it for the the longer term you know
i'm not super worried about what happens this month or so i'm more thinking like throughout
the cycle if this isn't the end of the bull run what products are going to continue to get more usage
and you know prices go up more than solana or bitcoin i still think it has a really good shot
to do that i would agree i do feel like if and when things turn around and broader crypto i feel
like this will likely be it's been a momentum. It's got some momentum to the downside.
I think when that's bullish, it'll be a perfect. You can completely argue if that's how you trade,
like why would you own any of this over a fart coin?
But that's why we own both.
It's nice to have some diversity in the portfolio.
It's nice to have something that you can tangibly attribute
some value to that isn't
just pure memetics i think key to watch will be like how does their volume continue to
grow or decline like are they able to continue eating into binance
perps market share and if that continues to grind up then I think that's going to be hugely bullish. For sure.
Oh, we just had a really nice punk sale.
126 ETH pilot.
Let's take a look.
20 seconds ago.
Yeah, I had a nice one right before that,
these 85 pilots as well. Oh, did someone just see those?
I didn't see.
Yeah.
Hey, guys, I got to run.
I have to shake beer for this punk chat yeah thanks for joining us jeeps
in a few minutes here save a wallet bought both of those very interesting that
i mean the one at 85 to me is just objectively better um
so the fact that they paid another 40 the the one right after that is because they're twins
uh i mean they're technically not twins they don't have the same lipstick or skin color
strange yeah especially because there's there's another one. Wait, they listed the one they just bought.
This is interesting.
So if you go look at the listings on Pilots,
they just listed the one they bought that is the light skin hot lipstick at $125.
I wonder if they meant to buy the other one.
That's some weird stuff going on here.
Very interesting to buy at $85. Oh, it's not the same one that's some weird stuff going on here very interesting to buy 85 oh it's not it's not the same one holy shit i'm stupid that's its twin right there the the one that they bought has
an invisible earring um you could tell by the left ear there's two black pixels um the one
that's listed at 125 so yeah i'm curious why they want to maybe they're valuing the the
hidden earring a little bit i it's interesting but two nice punk sales regardless um so that's
what caught my attention didn't mean to start immediately guessing why you could definitely
argue that the hidden earring on the pilot looks a little nicer because you got the outline goggles that are black and it looks like a continuation of the goggle.
But I mean, still an interesting choice to me.
I mean, 126 each.
A lot.
That's a hoodie, basically.
I mean, I think it's a spot hoodie that's kind of ugly.
That's a big pay up for for that 3x the floor and punk's been holding the one at 85 is really nice
like for for 2x the floor getting one of the rarest females um you know with no negative
traits on it you know there's no mole or spots or anything like that's nice the one at 126 makes me
scratch my head yeah pilot's third most rare attribute there yeah and honestly i feel like
choker just kind of sucks ass like if we're gonna be honest it's i think even the the punk's founders
said they it didn't hit how they wanted it to hit like to me pilot and tiaras are just significantly
better than chokers um so it's nice to see yeah totally agree pigtails actually a little
maybe look like they're a little cheap here within 10 of the floor uh jeeves one or not
these one of your thoughts on the wizards so we had the oh yeah one of the biggest oh oh
i thought you're about to say forgotten runes i've been playing the game you meant
the fucking taproot wizards that i'm down money on um it reminds me a bit of art block summer when
they just were doing dutch auctions and things were going at high prices because all the money or the the value of the mint was accruing
to the artists or the the mentors you know or not the not the people minting but the the people
providing the mint um i kind of regret not selling the one i bought for point two when they got back
to point two because i originally only planned to buy the one at point one and then i found out i
was on that list and i was like oh fuck it i'll buy two and see what happens but um all of ordinals are just fucked like
there's no ancient bitcoin whales coming to bail us out everyone's a seller no one's a buyer so
cats are down to about where i thought they would go we talked last week i think about that i was saying like 0.04 um people are selling
nodes and puppets as well um no no relief in sight so we'll see what they do there's the whole like
token play with them right like you're not you don't just own a jpeg but you own um you know
maybe a future token so i don't know if people don't care about that
right now or the valuation of that speculative token is too high or whatnot but i should have
only minted one or i should have sold the one i minted when they got back to point two um looks
like another great tax loss harvesting opportunity for me i've been a little surprised i think udi
has come out they've been, not even just hinting,
kind of loudly talking about the token
in the past week.
I think we're probably
people, A,
either don't know about that, or
because it's not confirmed yet, they're not
fully believing it. Or B, they
do, but think it's far enough out. Because
QuantumCats meant it a year ago.
Tapper Wizards just came
out so a token's probably six to twelve months out i mean if these came out um a year ago i mean
these would be close to a bitcoin yeah um i mean we had node monkeys at basically a bitcoin so
market timing is so uh tough with this stuff but yeah, I'm not panicking the
cell line at 0.14.
Tell you that I'll go down with the ship and see what happens before I sell it here.
Yeah, I would agree.
I mean, they'll, they'll find a bottom.
I think there's a good chance they'll trade over mint price some point in the future.
Yeah.
And then I, since i brought it
up i'll give a shout out to the forgotten rooms wizards because that game came out and i've been
playing that a little bit like level 15 um probably eight to ten hours into it over the last
week so it's been fun to to pull that up while i'm playing runescape and play both at once
it's not super intensive um but it's nice to just have a game that i can use some nfts i've
owned for a long time in and see a lot of familiar faces it's also fun like what like how do the
nfts play a part in the game um so the wizards are just like reskins for your character um but
i'm like very clearly me in the game because I have an
honorary wizard so it's like
if you see 3D wizard D's
it's like very clearly could only
be me so it's been fun
to meet a couple people
made some friends doing
these like group raids because
some of the stuff you have to have like a
team of three other people
and yourself to clear it um
which has been kind of cool to to meet people who may have been aware of who i was for like years
and i never knew them until joining a raid party with them to do some content in the game but
there's a whole nother currency system in the game i haven't fully figured out because i wasn't
super paying attention to all the beta tests, but there's like
land plots and
currency to activate things on the land
plots, and if you were beta
testing some of the stuff
in the process, you got airdrops of
these tokens, which apparently I don't
have any of, but I'm
not worried about it. I'm just kind of just enjoying
the game without all the
complex economy
shit.
Nice to see one of the OG MT teams continue to build through four years
and now their game is here.
So it seems like it is a fun one.
I think we've gone around the horn.
We're going to wrap up here in a second,
but I got to share something.
Peter just dropped in our chat,
perhaps a sign of optimism for tomorrow.
White house says president Trump made up his mind on tariffs and wall street will be just fine
so not sure if this is what the fuck's that man he's made up his mind his mind is made up
these and uh wall street will be just fine so So we've got some. All right.
He made up his mind and the numbers are going to go up, baby.
We're going to win again.
We're going to be so fucking tired of winning by next week.
Let's see.
Have the coins rallied on that?
No, we're down actually a bit.
He said Wall Street, not on chain.
Yeah.
Very, very true.
We'll see what it means for american bitcoin tomorrow
yeah we didn't even talk too much about that but what a ridiculous thing
yeah we'll have to save for a longer conversation like trump's kids
bitcoin mining thing calling it american bitcoin
they're really going deep
into it.
Sometimes I wish they just won it.
Sometimes I wish they just
won it.
We're seeing the pushback.
Last week it was Elizabeth Warren chirping
Trump and Elon about the
stablecoin bill.
Now we've got more congressmen
saying that the deeper that Trump goes,
the murkier all this crypto policy gets.
And I think they have a strong point.
And we applauded
David Sachs for divesting his crypto assets
and here we have the Trump family
investing as much as they can
every week.
Yeah, it's not a great look, man.
It's not what we want to see.
That's the downside the upside is
i think the line of sight to bitcoin mining driving an american global bitcoin strategic
reserve is very non-zero yeah to me the tough part gets you know thinking a little longer ahead you
2028 election if you have the trump family spend the next four years ingraining themselves so
deep into the crypto culture with companies and tokens and other bullshit then you have such a
polarizing push against the way it was that like 2028 democrats win in that scenario they just go
the complete opposite way and say like hey like the fucking trump family love this
shit we hate this shit get out of here and we just kind of rotate back to where we were i mean
i'm not saying that's likely to happen it's just possible uh downside thing i think about is the
trump family tries to ingrain themselves more and more into crypto i think it's one of the single
biggest risks right now.
I would just rather they not, right?
I would rather they not,
but that's not going to happen.
And Bitcoin, especially, it's been interesting to see
the Bitcoin mining shorts have been out
and they're down quite a bit. I wonder
if this will be enough to start to
flip some of the sentiment around
that, especially if the mining becomes a path to the strategic reserve.
A lot to unpack.
Maybe we'll save it for another show.
Folks, we are over the hour here.
So I think we'll go ahead and wrap it up there.
I want to thank our listeners.
As always, I want to thank my co-hosts.
I want to thank our partner, Wallet Connect.
We will be back next Tuesday to recap how the hell Liberation Day went. our listeners as always want to thank my co-hosts want to thank our partner wallet connect we will
be back next tuesday to recap how the hell liberation day went if we are indeed liberated
we'll find out here very soon until then enjoy your tuesday have a great week bye take care guys We'll be right back.
