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UNDER EXPOSED: The Institutions Aren’t Coming…They’re Here
Recorded: April 29, 2025 Duration: 0:59:48Space Recording
Short Summary
In a dynamic discussion, WalletConnect's token launch and strategic partnerships were highlighted, alongside significant institutional investments in Bitcoin and bullish market predictions from industry leaders. The conversation also touched on emerging trends in crypto, including the rise of DeFi and the importance of user experience in blockchain technology.
Full Transcription
Thank you. Thank you. GM, GM, everyone.
Thank you for joining us here this morning, this afternoon, wherever you are at.
We're going to start the show here in just a minute.
We're getting our speakers up on stage while we wait. A few
shout outs. Fungible.
GM Switch. Zanzibar.
Always here. GM
GM. Who else we got? Arias.
Blind Gray.
Mute. Googly.
GM GM. Who else we got?
Shine.
Huh. Acid Gas. Alright.
GM GM. Thanks for joining us. Alright. I got D's up here. Underexposed. Wall Connect. All right. GM, GM.
Thanks for joining us.
All right.
I got D's up here.
Underexposed wall connect is up here.
I think Sims, whenever you're ready, let's kick. Thank you. Hello, hello everyone and welcome to episode 23 of Underexposed, our weekly macro show
hitting all of the biggest topics and trends in crypto and across Web3.
Folks, today is Tuesday, April 29th, and this past week it has been a tale of two markets,
strategic uncertainty and equities, as more and more folks are seemingly calling for a longer
recession due to the tariffs and this trade war. Yet the
crypto outlook is moving cautiously bullish and perhaps we're ready to throw caution to the wind
and just be outright bullish. And the question is, can Bitcoin and crypto finally decouple?
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, starting with D's,
our collector, CoinStacker, and trader, D's GM. We're in the Rectat. How you doing?
Doing well, man. Doing well. No complaints here. Got beautiful weather.
French's are heating up again. Not a lot to talk about.
They sure are. The weather has finally turned in Chicago. It's been quite nice and long,
long overdue. Folks, we've got Peter Jennings on with us.
He's the founder of several companies, our resident macro expert.
Peter, GM, how are you doing?
GM, doing great.
Fantastic workout this morning.
Feeling really good.
A lot going on, as always.
And, yeah, excited.
I look forward to this every week.
We look forward to having you on.
And I love the Yeet hat.
Quick shout-out to Yeet.
$50 million milestone. Big crust.et hat quick shout out to yeet 50 million milestone they crossed yeah shout out to yeet shout out to our boys over there mando keyboard
monkey ben lamb uh really rooting for them so uh really excited for their success love to see it
folks we've also got jeebs on with us early stage crypto vc dabbles in internet capital markets
those are back by the way uh and he wears a lot of hats as well.
Jeeves, GM, how you doing?
GM, Tyler.
Yeah, sure are back.
Lots going on in the crypto world.
Lots going on in the real world.
Count it as a new PM.
Trump rolling back some tariff stuff.
Come to dive into all of it today with you guys.
We certainly have a lot to get into before we do.
Today's show, folks, 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, 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 WalletConnect
on X and Telegram to stay ahead of what's next. And folks, guess what? We are talking with the
WalletConnect founder, Pedro, in the second half of this show to talk their history, their growth,
the token launch, future plans, and a lot more. So stay tuned for that in the second half of the
show. Before we get started,
as always, 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,
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, now let's get into it.
I am going to fire up the screen share for those who are in the stream.
We'll get that stream link pushed out to X here shortly as well.
Taking a look at the board, we're up decently on the week.
Bitcoin, 95K is up 4% on the week.
ETH up 6% outperforming, dare I say.
Encelana up 1% at 148.
From a macro perspective, the S&P is up 3% over the past five days or so.
I think recent headlines here,
some hostility out of Amazon,
at least from the White House as Amazon now putting the tariff impact
on the cost of goods directly on their website.
So the White House does not like that.
Meanwhile, the White House is saying
that what Trump and Besson are doing
is driving strategic uncertainty.
So the uncertainty in markets is all part of the strategy, according to the White House.
As for the deals themselves, it does seem like some progress perhaps being made with India, Japan, South Korea.
China, though, the big one still seems pretty much in a standoff.
Though perhaps a little bit of progress, a little bit of concessions coming in.
Businesses still feeling pretty uncertain
on the broader outlook.
I'm seeing more and more calls for recession.
Meanwhile, crypto really feels like it's outperforming.
And I think the institutions, the ETFs are a huge part of that.
We had a massive week, over $3 billion in net inflows to the Bitcoin ETFs this past week.
A monster day on Friday.
So I bet the BlackRock ETF, they report with a one-day lag, $970 million on Friday.
So a high not seen in several months there.
We've got institutions piling in.
Saylor bought another $1.4 billion last week.
We've got Cardone Capital, the latest fund to throw their hat in the mix,
$1,000 plus Bitcoin.
That's $100 million that they are going to add to Bitcoin, but not just Bitcoin, folks.
So Janover, now DeFi Development, they rebranded. They also
announced on Friday they're going to raise $1 billion to build a Solana corporate treasury.
So now we're seeing the institutions start to pile in to other cryptocurrencies as well.
What else we got? We got Arizona, perhaps the first state to approve a Bitcoin reserve.
And then Cathie Wood laying out her price targets for 2030.
And boy, she bullish, 2.4 million price target, 500K as her bear case.
And then Standard Chartered just yesterday said they think Bitcoin is going to hit all-time high in Q2.
So it feels like more crypto bullish takes are on the timeline. Meanwhile, traditional
markets, equities, perhaps folks still leading a little bit more bearish. Peter, I'm going to toss
it to you. That was a quick roundup. What's your current macro outlook? Thoughts on the strategic
uncertainty? I guess is recession still your base case for the traditional markets here looking forward over the
next quarter,
two quarters?
Yeah,
lots of unpack.
I think the first place I want to start is a 10 year starting to go down.
And this is something just to continue to watch.
This is what Besson and the administration,
it says they're North star.
So I'm really watching this closely.
We want to continue to see this come down.
So it's encouraging to see us at 417.
I'd like to see this number below four.
We'll see how it gets there.
I guess the concern is if it does get there,
maybe that is because we're in a recession.
That's something that I'm watching really closely.
Continue to watch gold, Bitcoin, and how they're trading relative to other markets, specifically equities here.
In the U.S., gold has sold off a bit after reaching all-time highs, about $3,500.
I think some of that capital came back into risk on assets.
Broadly, still expecting piercing volatility.
It's been a theme we've
talked about every week here on the show. I definitely don't think we're out of the woods.
And then the main topic you kind of hit on with the Amazon story is tariffs.
Gerard and I, or Jeeves and I were at a dinner where we had a lobbyist talking and basically said
a lot of people in Washington were really surprised. Even people involved in Trump 1.0 were just blown away at the lack of execution around these tariffs and kind of the extreme nature of these tariffs.
So I've been more bearish on the tariffs in general and how they're impacting markets.
We've talked about how the execution was poor.
That's not a unique take.
I think that's kind of a consensus take at this point in time, how they were rolled out.
We'll see how that comes to fruition.
I did see that there's reports that we may have a trade deal with India.
Bestin's working hard on Japan.
So that could be good positive news, but just still so much uncertainty.
and we're in a very connected world now.
And we're in a very connected world now.
A lot of globalism,
just the globalism impact
has just created a lot of interdependence
on these across the world.
And I think that this disruption,
there'll still be more impacts felt.
So yeah, 65% chance on Polymarket.
That seems broadly right to me
and we'll see how things kind of play out.
But still so much to digest.
I think people may be getting a little bit complacent just because we've had relatively
up only risk on assets for the last couple of weeks and people just assume it's going
to be the same.
And I certainly think there's still a lot of downside out there and a lot of volatility
that could be coming to fruition.
So trying to be thoughtful about asset allocation, and I'm sure we'll dive into kind of different things.
But from a crypto perspective, Bitcoin does look really, really strong.
It's been encouraging to kind of see it act as digital gold.
Encouraging. Definitely. I would agree.
Jeebs, I want to toss the same question to you.
I feel like you had maybe some macro takes last week
we didn't have a chance to get into,
but kind of curious for your same thoughts.
64% of recession,
does that jive with your current view
on traditional markets?
And then perhaps part two of that question,
do you believe in crypto app performance here?
Is it going to continue?
Yeah, I think those odds
are seemingly getting priced in correctly.
As Peter noted, you know, we had looked at tariffs and other stuff initially, right?
If you were to rewind 100 days from now, I think everyone was really excited about what
could happen.
And now 100 days into the Trump administration, we've seen the rollout of tariffs.
And it's just been that the brute force method clearly didn't work.
We've disrupted a lot of our relationships with key trading partners, key relationships
in the world.
And as Peter mentioned, during that dinner, there were some really great insights that
that dinner, there were some really great insights that the speaker had. And one of them revolved
the speaker had.
around this, that we've done a lot of damage to various countries that viewed us as partners.
And one big one we can look at is Canada, who elected a new PM yesterday. And the PM's biggest
message is, hey, we're looking to break up with the U.S. to some degree. So that relationship seems really important.
Let's see sort of how things go from here.
Obviously, the election just ended last night.
Carney, I'm sure, is going to look to chat with Trump or Trump hopefully with Carney.
We can rebuild that relationship and find ways to make up there.
and find ways to make up there.
Like Peter mentioned, India is a really key relationship for us
when it comes to whether it's manufacturing moving there,
just countries that have the appropriate labor costs
for us to produce goods.
India is a great place to look.
So hopefully they can increase the manufacturing capacity
and quality out of India,
and that could significantly change the trade world order over time.
In general, I think there's a lot of risks.
And I've tried to remain optimistic over the past 100 days.
And I would say my optimism meter has been slowly just bleeding out over time.
If I squint hard enough, I can see some glimmer of a bright future.
But I think I really have to try to convince myself of it more than anything.
So that's just general macro outlooks.
Not really positioning differently currently.
I've been primarily accumulating Bitcoin over the past three to
four months. And going to crypto, I do think that Bitcoin has an opportunity to outperform here.
Just as we're seeing, I think, more institutional buys coming in, more strategies developing around
Bitcoin. Positive news out of Arizona yesterday.
Obviously, they haven't completed the final boss, but I think that's a glimmer of hope.
And so I'm looking to the next quarter and really even the rest of this year as a positive
year for Bitcoin. I'm not as convinced on alts right now,
but hey, we're seeing that high tides
are lifting all boats here.
Now it doesn't necessarily lift all boats equally,
but there's been a number of altcoins and meme coins
and other plays that have bounced off their lows.
So Bitcoin's been just my consistent bellwether here.
Do you feel like this tariff trade war situation,
is there an outcome here where Bitcoin ends up being a big winner? And as stocks become a little
bit less investable than perhaps they were, it leads folks to look at other investment assets
and we finally see the decoupling or do you feel like there's still
potentially yeah potentially i think you know everyone looks at the same chart too which is
the global money supply sure and that's just been the classic bitcoin chart and i do think that as
money gets printed globally as you know maybe the u.s gets to a point where we start to do some QE if that happens.
One of the natural places
where people will begin to allocate funds
could certainly be Bitcoin.
One of the guys,
Peter and the guys at Amalfi
just threw this amazing event last week.
And I was speaking with one of the guys there
who's a wealth manager for
high net worths. And he said he's already allocating 2% to Bitcoin for all of his investors.
So I think that's a strong signal that we're starting to see that trend emerge a bit, Tyler.
That's been on our list here for some time. But yeah, this chart, it's almost like,
is the prophecy true? Will know, will the prophecy happen?
I can't look at this and not laugh
because everyone who,
this is like astrology for men,
for laser eyes.
I feel like everyone,
they're going to find their M2 lead time
that matches the chart.
But I will say this.
If Bitcoin goes to $150K
this summer
and basically matches this chart,
then I'm basically going to throw out
every other indicator or metric I look at.
I'm just going to print this out.
I'm going to print out the M2 chart
and just stare at it every day
for what I think Bitcoin's going to do.
Let me ask you this though.
What if it decouples from him too?
What if this,
this,
this pink line here just goes off the cliff?
then I will stop looking at him too.
You know,
anything that I've got printed out of my house,
I'll rip up and put in the trash can.
Do you think there's a chance that it like,
this chart could almost manifest
the Bitcoin price down in that instance?
Do you think that there's that much weight
on this chart? I don't think there's a whole lot of weight
on this chart, personally.
But I think it's just one
that if and when it's right, people
will want to
point to it. But I've seen so many different iterations
of this. This specific one is with a three-month, but I've seen so many different iterations of this. Like this specific one is with a three month lead.
I've seen the 97 day lead.
I've seen the 117 day lead.
Like there's so many iterations of this,
but yeah,
this is like a thirst trap for Bitcoin people for sure.
Like if you want,
if there's like some social competition,
like fantasy top and other stuff,
just post this chart like every day,
just with like hype around engagement
but i think that if you take this with any uh notes of seriousness the money printing is coming
from the east right so it's a question of if china is selling off u.s dollars we think like
there's narrative they're buying gold or they also buying bitcoin if they're putting money and buying alternative currencies and that is a real a real strong narrative for me uh in addition
to the institutions that we know are piling in peter i saw you jump in there for a second
yeah i mean i want to just go back to what paul titter jones said and i and i agree with him
completely just on how the world's going to work and just
all roads lead to inflation. There's just no way out outside of devaluing the debt that the world
has and increasing the money supply. So that's probably really good for Bitcoin. That's something
that we've talked about. There's some deflationary forces, the biggest being technology and what AI
could do, but the world has so much debt.
These governments can continue to print and central banks can print money.
So to me, you know, that M2 chart is just going to be up and to the right.
And there may be breaks in it, but I don't really see a path out of that.
So for Bitcoin, this is consensus, I think, for a lot of people that are in the show and just following and why we love Bitcoin is just that in nominal terms, it should just get more and more valuable.
So I'm with you on the MTMoney supply.
I think there's certainly other things to look at, but broadly, that trend should just be up and to the right.
And that should be good for Bitcoin in
nominal terms, especially as it gets more and more adoption around the world.
Yeah. The one wild card I want to throw into all of this, Tyler, that we haven't, you know,
we've touched on it. We just don't have much information. There's numbers thrown around
all over the place is tax reform. And I've seen, you know, a number thrown out this week. Initially, it was no federal income tax
on up to 150K. I saw 200K this week. Obviously, tax breaks are going to continue.
But we haven't really had anything significant there. It's all just been tariff news and getting trade deals done with countries.
So that's one thing I want to throw out there that could throw some positive tailwinds.
Yeah, absolutely.
One to watch.
I think best I'm saying there's been some progress on the tax deal being made.
So certainly one to watch.
Dees, I want to throw it to you.
Are you feeling more optimistic,
feeling the same for now,
starting with crypto majors,
but then other aspects of the crypto market?
How are you feeling?
I feel pretty much the same
as I think I feel every week.
Not much has really changed for me.
Kind of similar to Jeebs, denominating more
in Bitcoin, have enough cash to live off of for well over a year comfortably, not rushing to
over allocate or anything, but playing some more of the trenches and the beta plays and just kind
of chilling. I always think back to when Jeeves was pounding the table on the word transitory and how a lot of the policy stuff is more transitory
and not going to be around forever, even if it feels like it is right now. I also think
the recession stuff might be a little overblown, or maybe I just don't know what the definition of a technical recession is. But over 50%
seems pretty high to me.
I don't know. That feels higher than it should be, but maybe
I'm just being too optimistic still. Yeah, it's really shot up here
in the past week or so, which is
noticeable when you take a look at that.
So it was, I mean, it was just at 50% last week,
the day after our show, now it's back up to 65.
And you can show the rules there.
I mean, it's just two consecutive quarters
of negative GDP, right?
Especially with these tariffs.
I mean, these tariffs just have such a massive impact.
I think this number makes sense.
And that doesn't mean that it's going to be,
you know,
great depression or anything.
But I think vibes wise,
when I hear the word recession,
I think like 2008.
Yeah.
This is a fabricated recession.
Like this is,
this is not like,
yeah.
Like things didn't really
deteriorate into a bad situation it's like someone just like hit you on the head with a bat
like deteriorated this is a manufactured recession and this is exactly you know trade
and just kind of how the global market works. Yeah, just a super interesting insight.
Again, and not everyone is right,
but this lobbyist has a ton of experience,
not partisan, works with both Republican
and Democratic senators.
Broadly, I do think my sense and what I've heard
is that he's more Republican leaning,
but was just saying Trump's been obsessed with tariffs since the 1980s and the
world's changed a lot since the 1980s. And, you know,
people around him just were not expecting this to happen.
And I think the consensus view in Washington and certainly with business
leaders, and you're seeing this, uh,
there's headlines like tech is fracturing with Trump. They don't like this.
And I've just kind of, you know, there's some people saying,
oh, there's 3D chess going on and these tariffs can really work.
I'm less convinced by the day that there's any thoughtful strategy here.
Trump checkers.
That's Steve's optimism.
That was one of his key insights to add what Peter was saying.
Yeah, he kind of, he he slowly deteriorated my thoughts around there
with some of his insights, like Peter mentioned.
He basically said, look, there isn't a ton of 340 chess going on.
And there was potentially and likely an assumption via the administration
that most countries would just pause and sort of kiss the ring and they haven't
and so there's this bit of you know unexpected pushback going on around the world right now
significantly more than they were anticipating i think the silver lining so like i see your
optimism meter just slowly bleeding out across the year as you mentioned there jeebs and i feel
like it kind of matches my personal view on stocks.
So if you can't buy mag seven stocks right now,
because you feel like although there might be pockets of rallies,
the general trend is still a downturn until this is resolved.
And this is going to take some time to resolve,
which I feel like that's the camp that I'm in right now.
I just from listening to smart people talk,
listening to friends that I have who run small businesses
and how they're impacted,
it doesn't feel like we're anywhere near out of the woods on this.
But glass half full,
I still feel like people want to throw their money into the market.
Like that is, it's like my gut read right now.
If you're not going to bet on stocks,
what are you going to bet on?
I feel like crypto looks nice.
The more that it outperforms,
the more it's reflexive.
If Bitcoin continues to push up now
with stocks chopping or going down,
it looks even stronger.
I feel like reclaiming 100K would be huge.
Tyler, how much of this do you think is coming from maybe the institutional bid?
I mean, a huge part of it, right?
I mean, Saylor bought $1.4 billion last week at a 93k average so he's let's see i mean he probably
drove this rally up to here or so um there's a lot of daily sell pressure we're learning
like just to absorb the amount of buys that that sailor and crew are doing but the the some of the biggest
news from this past week we haven't had a chance to get into it we're not going to go deep i meant
to say this for another show because i want to get to our conversation with pedro and law connect
here in a few minutes um it's not just sailor anymore so there are more strategy competitors
in this latest one capital 21 from the cantor they're teaming up with Tether. They're teaming up with SoftBank,
headed up by Lutnick's son, Brandon Lutnick.
They feel like they're going to be a real player,
and they're starting with $3 billion.
But I'm imagining their sights are going to be much, much higher than that.
And their pitch deck, they compare themselves to MicroStrategy,
formerly MicroStrategy, now Strategy, and why they're better.
So they're coming for the big dog,
which to me signals they've got real plans to find ways to finance Bitcoin investment.
And I think it would be naive
to think they're going to be the only ones
to try this, right?
We're already seeing dozens of companies do this.
So that's going to continue.
And you've got your wealth managers who are saying at cocktail parties they're already up to two percent across their portfolios yeah i feel like we're still just in the early stages of that so
i feel like that's some real strong tailwinds right now so that's what's kind of gotten me
bulled up we're starting off at two percent and then we're going to get to 60-40.
All right.
It's going to be the new 60-40.
Hell yeah.
You heard it here first.
So, Deez, I know we're going to have a few minutes.
I want to talk trenches with you a little bit.
Are you back?
Are you back in the trading streets?
Not fully back, but I've been taking some shots.
We're net up just because the token that we held for the last four months ripped 15x off the bottom.
But other than that, have not had super good luck.
I feel like I'm late because I don't have my boots on the ground,
so to speak.
And I normally buy things in the 3-5 mil range,
and if they don't get out of that range,
they just eat shit, and then I eat shit with it.
But it is fun to just see stuff happening.
I'm not buying the Ansem shills, and maybe I should be,
because getting the house coin updates every day
have been kind of painful, because we were talking about it
at 3 million, 5 million, and then next thing you know,
it's over 30 million.
But it's just nice to see a return to
gambling in the trenches i i do think from what i can tell there's really not new market participants
so it's a lot of uh i don't know i think it's a little harder right now to make money but um
it's just nice to see people are at least willing to to gamble on it of course fart coin i don't
even know if that counts as the trenches,
but like I'm looking at stuff like virtual and fart coin and shit's coming
back kind of strong.
And I don't know.
It just makes me feel some type of way.
I'm pulling up the meme.
Your board seven day numbers are huge.
Like a lot up 40 to a hundred percent.
I mean,
Pangu,
we haven't talked about Pangu,
but that's been a pretty big winner over the last week too.
A nice little curl off the bottom.
Up like 3x off the bottom.
But a lot of these tokens are up nicely off the bottom.
Even, I was looking at like Flog the other day, which was all the way down to 25 and back up to 60.
Even Arc was like back to 65 after going down to 30.
But I think some of the strongest gainers are more interesting.
Like, I mean, Fartcoin's up 5x plus off the bottom.
Virtual is up 3x plus off the bottom, almost up 4x.
And that's kind of where I want to pay more attention.
It's like, what are the relative outperformers?
Everything should be at least up 2x off the bottom.
If you're holding something that isn't up 2x off the April lows,
then that's probably a sign it's relatively pretty weak
compared to everything else.
And the interesting stuff is in that 3x plus range
off the bottom for me.
I would agree.
I think this chart kind of is perfect. It's a perfect
symbol of what the markets have been like for the last two months. It was chop. Yeah. Yeah.
You're starting it up there. Yeah. And then time capitulation. And now like if you were in the
capital, I'm fine missing the first 100% move off the bottom. I want to see more signs of life.
I think we're starting to get signals that that is happening. So for the first time, first 100% move off the bottom. I want to see more signs of life.
I think we're starting to get signals that that is happening.
So for the first time, I was outside in the yard.
I was hanging out with the kids this week,
and I found myself keeping an eye on the group chat and popping back inside to make a few moves.
I don't think any of us genuinely believe
AI was a one pump and dump thing, right?
It still seems like the obvious
trend of whatever
fucking cycle we have that's new.
It only makes sense for there to be
winners in this sector, even if it
was a slow couple months of
negative
80% price action.
A tough stretch, but in the last
three weeks, I tweeted this morning, up
a full 100%. AI market's up from
$4.5 billion to $9.
So there's, and that wealth effect
is starting to take a point. It's starting to take
effect. Virtual's got listed on Binance
today, I saw. So perhaps that's
driving some of this as well. I think
listed on Binance before Coinbase.
Is that right?
Are they on Coinbase yet?
That is right.
But we're getting day one listings
for Coinbase venture insider-led projects
that are getting pushed by the base team.
So that's just fucking beautiful.
Yeah.
It'll be interesting to revisit this
over the next few weeks to see was this just a pump off the bottom or we're going to have more of a
sustained rally i think a big part of that is what's bitcoin doing if bitcoin continues to
grind up i do think we'll see more pockets of outperformance here uh well folks tighter
conversation here but i want to make sure we have enough time for the second part of our show here.
And that is talking with Pedro Gomez from Wallet Connect.
Pedro, GM, how are you doing?
GM, GM, how are you guys doing?
Doing great.
Love having you on.
It's been so fun to partner with you over these last few months ahead of the token
launch and everything that Wallet Connect has going on. Folks, Wallet Connects, I'll do a
quick background that I want you to dive into it more. Pedro started in 2018, has grown into a
critical open protocol used by thousands of apps, millions of users. Now they've been entering a new chapter,
the launch of the Wallet Connect token,
live for trading, aiming to decentralize the network
and empower the community.
Pedro, maybe just for starters,
kind of share your journey, kind of give us the backgrounds
from conceptualizing Wallet Connect
to where it is in its current state.
Well, I feel like conceptualizing Wallet Connect to where it is in its current state? Well, I feel like conceptualizing it,
it was more like it kind of just came out
out of a big problem.
I came from a fintech background
and I was an engineer in one of these
neobanks back in 2016.
And I have to say that it was quite fun
to build a bank like it was kind of
targeted for like university students and it really had this kind of energy of revolutionizing
the finance world but we couldn't actually do that because traditional finance doesn't actually
allow you to do that and that kind of like pissed me off because if we're really going to revolutionize we have to completely take the whole system down and i learned about ethereum in
2016 and i thought this is what i'm going to do for the rest of my life and in 2017 i actually
started building a wallet with another early team building in ethereum and that also kind of just
showed up like there's other problems to be solved and crypto back then was like so
immature and so broken and wall connect was the solution for all of that you know 2018 that's
where wall connect was first published we tweeted about it the first prototype and it gathered so
much support like everyone just went crazy this is exactly what we needed and since then we've
just been really focused in improving the user experience for wallets.
Yeah, I'm curious, what were some of the big milestones
from launch back now, six, seven years ago to now?
Looking back on the journey from your perspective,
what were some of the key moments along the way?
Damn, like, I mean, let's go on a history trip.
Like 2018, we published it.
The first thing that we actually got
was like a Ethereum foundation grant.
So that allowed me to actually move full time.
And that's when I moved from like, you know,
just a contributor in one of the teams
to actually being a solo founder
that actually built Wallet Connect.
And I got to travel around the world,
meet everyone to really make Wallet Connect
a community project.
And in 2019, we actually became possible
that you actually use it fully on mobile.
So Wallet Connect really started
with this QR code scanning
where your phone is your wallet,
but your computer is where you actually do
all of your trading or all of your transactions, NFTs and everything. But then there was a lot of
mobile demand. And that's where in 2019, we really blew up and we had a lot of wallets.
And then in 2020, it was this DeFi summer where everyone was using Wallet Connect because DeFi
was just really the hot topic. And we had one of the biggest walls was SAFE,
had a lot of users that had millions of dollars
just managing DeFi positions.
And then in 2021, as everyone knows, was the NFT hype.
This was actually when we actually got the first VC funding
and we actually started growing the team.
It went from one, two, three, and then eventually now we have 50 people working on this.
And in 2023, we actually had a massive upgrade and we went multi-chain.
This meant the blockchain that started originally just Ethereum became Solana, Bitcoin, Tezos,
Polkadot, Cosmos.
Really, you can name any blockchain. Wallachnet works everywhere.
And we started seeing that there was so much dependency
into this public infrastructure
that we started onboarding our partners to run nodes.
And if they're going to run nodes,
then we actually have to build the incentives.
So last year, we announced the foundation,
we announced the token,
we actually announced the first node operators, and now the Wallet Connect network
is actually operated by 60 node operators, and we're going to double these numbers
very soon. Yeah, that's the latest milestone,
right? And a huge one. Congrats, again, on the launch of the token.
Maybe let's dive into that a bit. So you kind of went there, but what inspired
the launch of the WC token kind of how part two how's that line with the wall connect mission well i'm
very happy that we didn't like launch a token right away because what allowed us to do is really find
product market fit for wallet connect as an infrastructure and then once it actually had
the product market fit we also had like a lot of data points. We launched a token when we already had 40 million users, 250 million connections, 600 wallet partners, and thousands and thousands of apps.
The amount of volume of data that goes through the network was immense.
through the network was immense so actually designing tokenomics on top of all of that
traction was so much easier because you can just like run simulation and actually do like proper
economics so the idea between uh the token and the network was really now that we actually
decentralized how do we keep everyone in line and we had three things that was really important to
incentivize number one the node operators, as I mentioned,
the wallets, we want to make sure the wallets
are continuing to build and work towards
the future where WalletConnect,
and also the community.
So we did an airdrop in November for the community
where we actually extracted two years of data
of using WalletConnect
and then just retroactively airdrop based on the usage.
And then these became the most active community members.
And now we actually have an actual governance.
We have staking and everything in place.
And the final milestone that we haven't achieved yet is actually the monetization piece.
So WalletConnect network is still a public good infrastructure that has not charged fees.
But now that we actually have all the pieces together and
the token is tradable, everything is live, now we can actually activate fees. And this means that
app developers, whenever they use WellConnect, they get new users and they pay for that access.
Looking back, are you happy with how it played out? You mentioned that after the airdrop,
some of those members became some of your more active in the community.
So like,
were you surprised
with any of the outcomes?
Anything that perhaps
you would change
looking back at
how it all played out?
Honestly,
I'm really happy
and I'm already glad
the fact that like
we even were able
to launch a token,
you know,
like launching a token
is quite a milestone
for any crypto project,
but launching a token
in a network that's live with like millions of users and nothing broke and nothing shut down, it's even better.
But also, I would totally advise that anyone else who's launching a token, they should postpone for as long as possible until you actually have decentralization knocking on your door and saying saying now it's really time to decentralize
like decentralization is not something that you should do beforehand it should be
grow as much as possible and then you actually decentralize so i'm really happy and i hope that
like many people look at wallet connect and actually use it as an example for future crypto
projects that's really strong advice and i feel like we have no shortage of tokens but there is
a shortage of tokens that launch
and can sustain their valuations, right?
And I think it's the teams who do it in more thoughtful manners,
who build out their product and their market
and their community ahead of time
and take the time they need
versus just rushing to take advantage of market conditions.
I mean, you have to take compromises, obviously.
Like, you know, it took seven years, probably.
Maybe we could have accelerated everything if we launched a token on the first day.
But then honestly, like launching a token before having product market fit
also completely changes your priority system.
So now it's so much easier to actually reason about prioritizations with a
token. But that also means that we actually are building on top of a momentum that you could not
replicate if you had the token on day one. I am curious. I mean, do you keep an eye on macro
market conditions? Was that an input factor at all in your time?
Not really, because launching a token just takes a huge amount of time.
I mean, when we actually did this massive upgrade from going from Wallaconec on Ethereum to Wallaconec multichain,
that in itself already was like a two-year project.
And we were super happy that we deployed that in 2023.
Then from 2023, we had some performance improvements
and we're just upgrading the network
before we actually think about the centralization.
So if you think from 2024 to 2025,
it takes 12 months plus to actually launch a token.
It could have happened during good market condition good macro conditions or not
but you can never predict 12 months because once you actually start the process of launching a
token it kind of just has its own life and you can't stop it i am curious a quick side and we'll
come i'm going to come back to more about the token and more upcoming developments here in a
second but i think you were in the studio when we were having our chat on macro. I'm curious, what's your view on Bitcoin and perhaps other crypto majors here?
Do you follow those markets? Do you have an outlook on perhaps the next couple quarters,
the rest of this year? What's your view? Are you bullish, neutral, bearish?
Well, I've been spending all my career in crypto focused on developers.
So I've always measured networks by the developer sentiments, the developer adoption.
And if there's one thing that I definitely noticed in the last 12 months change is that you had Bitcoin as this blue chip cryptocurrency.
It's just undebatable.'s like the the best crypto asset
ever but then you had the slack of like developer adoption and this is where ethereum was able to
capitalize because you actually had like a strong developer ecosystem and for a long time i would
tell people like bitcoin and ethereum that's all you. This is where cryptocurrency is really going to innovate the most. Other tokens will show up and we need other tokens. But if you really want to play it safe,
that's the two assets that you really want to focus on. And then Solana really started paying,
grabbing my attention because as I was like looking at developer adoption, looking at the
ecosystem, this is something that it is not very easy to fake.
You can always buy KOLs, marketing and everything,
and it can make your token look really hot.
But getting developers to like what you're doing is really, really hard.
And knowing that Solana survived the FTX collapse and everything
and still had some issues around outages
and still managed to capture developer interest.
This is something that is very unique
and something that I've been paying a lot of attention.
And I've been going to a lot of SWAN events
in the last 12 months.
And I'm really, really impressed with that community.
Yeah, I think that's a really important takeaway.
And I do feel like Salada is getting a little bit too big to ignore. And it's
more than just the meme coins. It is what you said. It's developers choosing to launch their
products and apps on Solana because of the ecosystem, because of what it enables. I'm
curious, are there any other up and coming chains that also stand out or Solana the main one for you?
chains that also stand out or Solana the main one for you?
Look, I have definitely a lot of interests
and there's a lot of technical projects that I really appreciate,
but nothing that I would definitely just put my heart out
and say definitely this asset is going to stand out as much as Solana did.
And to give you a little bit of a perspective,
people sometimes dismiss Solana because. And to give you a little bit of a perspective, people sometimes dismiss Solana
because of all the meme coins. But I was there in Ethereum when ICOs were the only use case that
Ethereum had. And this was one of the big criticisms where Bitcoins would look at Ethereum
as just like, oh, this is just a platform for scammers. They just made it easier to scam.
And they were completely dismissing the technology that was behind it. And I was very, very close to all of the core developers on all the teams, apps, wallets.
The technology was there.
It was really valuable.
And now it has shown that Ethereum really excelled.
And it wasn't just about ICOs.
I think Sulanin is a very similar place that Ethereum was in 2016, 17, where people just
categorize it as it's just speculation,
it's just meme coins.
But realistically, the technology is solid and it's really capturing a lot of developers
to build that platform.
That's a really interesting analogy.
And I think even more coming from you, who was around and building in this time frame.
Yeah, the energy is very similar.
So, you know, it kind of feels like a deja vu.
It gives me a little nostalgia of what Ethereum used to be
whenever I go to a Solana conference.
You're certainly making me a little bit more bold up here.
I want to come back to Wallet Connect now.
So you mentioned the decentralization journey.
So let's go let's
dive into that a little bit like so how will the token function like what role is it play
as you look to decentralize yeah uh one of the things that we established first was the staking
this was critical for the node operators so all node operators actually have to stake to participate
in the network they need to have essentially when you think about staking,
it's just a reputation system with a financial component to it.
You put your money where your mouth is, and that's what staking is all about.
But the interesting thing about the staking in the Wellachmic network
is that it's not about security, it's about performance.
In other networks, people are staking with a specific node operator.
That means that if you stake with one node or another node,
one node will capture more rewards than another.
But this actually doesn't help how WellacNic actually performs.
The WellacNic network is all about uptime and latency.
So we actually have one single staking pool distributing the rewards.
And then the node operators have to compete in being the fastest and the most reliable node
in the network to capture a bigger chunk
of the market share of those rewards.
And on top of that, we also had the actual community stake.
So you couldn't actually vote in the governance proposal
without staking.
A lot of these DAOs and governance,
they allow people to stake just by holding tokens.
But this creates a wrong incentive.
And in the staking for WallaConnect, you actually have to set an expiry.
So you have to say, I'm going to stake for one month, one year.
And this creates a stronger alignment on long term.
So people who stake, let's say, a thousand tokens for a year and a thousand tokens for a month do not have the same voting power.
And this obviously is very important because a malicious party could just buy a lot of tokens, stake for a week, and then decide how the network is actually going to upgrade.
No, this is actually decided by the people who stake the longest.
And obviously, on top of that, we want to really activate fees.
So there's going to be tons of upgrades coming this month.
And we really want to decentralize the decision-making.
And we had this UX console,
which is basically a curated group of participants
who create proposals,
and then the community votes on the proposals.
So it creates almost like this representative democracy
with a referendum system. I mean, clearly a very thoughtful program and role out there. I think those decisions make
a whole lot of sense. I've got a few more questions, but I know Peter and Jeebs also
want to jump in. Peter, I'll throw it to you. Yeah. No, Pedro, thanks so much for being here.
I always like to chat with entrepreneurs kind of about rock bottom.
And I know within crypto, it's been a huge roller coaster.
You started this in 2018 or launched in 2018 when, you know, sentiment around crypto was starting to fade.
What were the most challenging times and what did you learn from those times?
And specifically, what do you think were the best actions that you took, both as an entrepreneur and just within Wallet Connect?
I mean, the good thing about building Wallet Connect is that it's such a fundamental
infrastructure that we don't feel the bear markets as much as other
projects. We actually see our growth charts just
being completely unaffected, and there's just more and more people actually
using wallets.
Because at the end of the day,
whether you're buying or you're selling your token,
you still have to connect your wallet.
So it's still growing the network.
And we are always expanding into new chains, new wallets.
So the growth is completely unstoppable.
For us, bear markets do not really affect us.
What affects us is is we had some events
where, for example, if you go all the way back to 2020, the network was so new and there were
some issues. When DeFi actually exploded and there was all of this yield farming and compound
launch and everything, we actually started seeing the network actually not scale as much as we wish. We had an outage that was kind of stressful.
And then in 2021, we had this other issue where one of our service providers shut down
our domain and was probably one of the most stressful four hours that then I was actually
just tweeting to the service provider, like, can you just turn it on?
And actually, with one tweet, you solve the problem.
And there's always these really interesting events
where as an infrastructure provider,
you just want to make sure that you have the most reliable service
because everyone is relying on that.
That's been a lot of important lessons for me
because it realized that Wallet Connect is so fundamental that it needs
to have a very different standard to other projects because so many people rely on it.
And we need to really set the example here. And that's why decentralization wasn't always the
first thing that we're thinking. We're always thinking about performance and reliability.
And we only actually decentralized when we actually started seeing that we need to grow
faster.
We need to grow into new regions.
Like right now, we support North America, Europe, Asia.
We might want to expand to South America, to Australia and Africa.
And decentralization really helps with that.
So having these incentives in place, it allows us together with a foundation
to actually expand and have a relationship
with all of these partners.
Yeah, super helpful to hear.
And certainly you guys have the North Star
of just being reliable
and that's paying huge dividends now.
So kudos to you for playing long-term games.
Jeebs, I'll toss it to you.
I know you have one question you want to get in here.
Yeah. Hey, Pedro, thanks for being here today and talking to us about Wallet Connect.
My question is, I think you sit on this really interesting intersection of all on-chain activity
going on, which means you see a lot of interesting data as to where the puck may be going, emerging
trends, things happening.
Where do you see, you know, you talked earlier about how, you know, some of the emerging
trends that you saw happen and how Wallet Connect success was sort of tied to some of
those.
Where are you seeing things go now and maybe through the rest of this year?
And what are some of the hot emerging areas that you're really excited about?
I mean, if you asked me this last year,
we had some data points.
And to kind of clarify what data points means,
Wallachnet network is actually fully end-to-end encrypted.
All of the connections and everything is completely encrypted,
so we actually can't detect addresses or transactions
or what you're
actually doing. What we can detect is having a certain traffic between one app and one wallet.
And we definitely can see some patterns around one wallet being more popular for NFT purposes,
or one wallet being more popular for DeFi purposes. And we also see some trends, for example,
like DeFi purposes. And we also see some trends, for example, last year, there was like a massive
adoption both on Ethereum and Solana around SocialFi. But like every other day, we were
seeing a brand new app that was building like basically tokenized social media. You know,
that seemed to be like the hottest trend in 2024. In 2025, it's a little bit harder. There's been a little bit of a slowdown. So you do see a
little like few examples here and there, but no strong trends. However, what I started to see is
we're actually starting to see more people actually adopting WalletConnect into existing
applications. And this is really interesting because this is not about actually building a
brand new app specific for crypto,
just taking an existing app and adding crypto functionality.
And one of the things that happened actually was in Europe,
there was like this regulation around the travel rule where you actually have to verify your wallets to do deposits and withdrawals.
So we saw a massive adoption across all of these exchanges where they actually added like Wallet Connect for verifying their wallets.
And it's not just there.
Like we actually are seeing that with payment service providers.
So I think we will start seeing more like non-crypto native apps just completely adding Wallet Connect altogether.
Very cool.
Thanks for the insights.
That is a very insightful takeaway. all connect altogether. Very cool. Thanks for the insights.
That is a very insightful takeaway.
And I think we're starting to see some evidence of that just right now with global adoption overall.
I mean, Pedro, we've got a couple minutes left.
I think always like a big question to end on is what's coming next.
What should your users, our listeners,
what should they be getting excited about what's coming up?
What do they need to know?
Well, to kind of recap,
one of my favorite highlights
of what's coming next for WalletConnect
is that we have this brand new feature
where now every time you connect your wallets,
you can actually delegate signing capabilities
to the WalletConnect network.
So that means that now,
instead of you connecting your wallets
and every time you need to transact, you have to go back to your wallet to approve every time. It's so cumbersome and
unfamiliar to most people. You would actually connect your wallet and then let the app and
the Wallet Connect network co-sign a transaction in order to protect the user without actually
having to approve every single transaction. It also allows us to do more security analysis
and protection for malicious attacks.
Wallachnet Network right now protects users
from fake websites, but then we would actually be able
to protect them on a transaction level,
which adds even more security and better user experience.
So Smart Sessions is quite a cool feature that's coming up.
But if we're not talking about the actual product,
if we're talking about the token,
I think monetization is going to be really cool.
Because if you think conceptually, WalletKnec is like the Visa for wallets.
And Visa has a battle-tested business model where you actually take fees from merchants
and distribute it to third parties and banks.
WalletKnec is very similar where apps will actually pay fees.
That pays the node operators, it pays the stakeholders, and it also pays the wallet. So everyone who's directly
involved in making WalletConnect work would actually be doing a revenue share through the
actual tokenomics. So I'm really looking forward to have those things in place and to be engaged
with the community. So if you haven't been involved,
check out our website and go to our Twitter account because we're always posting new updates about that.
Well, it's hard not to be excited about monetization,
better security, and better user experience.
I mean, I think that's three of the biggest rocks.
That's what we do.
That's what we do at Wall Connect for seven years and counting.
Well, that's incredible.
This has been an amazing conversation. Pedro, thank you so much we appreciate your your partnership
we really appreciate this conversation i think we're gonna have some awesome clips from this
combo as well for our listeners and for those who weren't able to catch us live so thank you for
joining us really good conversation folks that's gonna be it that is our show i want to thank all
of our listeners for joining i want to thank my co- show. I want to thank all of our listeners for joining.
I want to thank my co-hosts.
I want to thank Pedro, of course, as well.
We will be back next Tuesday to break down all of the events in macro and across the globe
and maybe go deeper on some of the topics that we had to kind of gloss over here today.
Until then, enjoy your Tuesday.
Enjoy your week.
We'll talk to you soon.
Bye. Hot air rises. Take care, everybody. We got it in. We'll be right back.
