ROLLUP: Markets Spooked? | MegaETH & Monad Mania | New CFTC Chair | Base & Polymarket Tokens? | Circle Arc Backlash

TRANSCRIPT

Ryan Sean Adams:
[0:04] Bankless Nation, it is the last week of October and we should tell everyone happy Halloween because it is Halloween day.

Ryan Sean Adams:
[0:12] I missed the costume,

David Hoffman:
[0:13] David. Yeah. I had some ideas. Costumes were tough this year.

Ryan Sean Adams:
[0:17] Didn't come together. I know you had a fantastic idea. Why didn't you tell me what you were planning to be so I can just imagine it in my head for the rest of this roll up?

David Hoffman:
[0:26] Well, I was very excited to do the costumes, but then when I discovered that my co-host did not have his costume. I took my costume off and I packed it up.

Ryan Sean Adams:
[0:34] Yes, he did.

David Hoffman:
[0:35] But I was going to be wearing all my mountaineering gear. So you could imagine a climbing helmet, my two ice axes, a harness, some rope slings, my jacket.

Ryan Sean Adams:
[0:45] I actually really want to see that. That would have been a sweaty podcast though. Like you would have been overheated by the minute.

David Hoffman:
[0:50] Yeah, there would have been a lot of like Gore-Tex going on. Open some windows.

Ryan Sean Adams:
[0:54] All right, so I ran downstairs to see if I had anything and all I had was a Sam Bankman-Fried wig, believe it or not.

David Hoffman:
[1:00] Which is your costume from like two years ago. Yes. So you've already done that one.

Ryan Sean Adams:
[1:03] And a Gryffindor scarf and a wand is my kids.

David Hoffman:
[1:06] And I don't know how those go together.

Ryan Sean Adams:
[1:07] Yeah, so we couldn't make it work. But what I wanted to be, what I thought of this morning was actually just like bald. Just like the, you know, bald is bullish. Just for the market. Just bald. I'm not going

David Hoffman:
[1:18] To cut off my hair for that. That would have been good.

Ryan Sean Adams:
[1:20] You couldn't though. Happy Halloween to everyone who's actually dressed up.

Ryan Sean Adams:
[1:23] We've got a lot to talk about today. It's time for the Bankless Weekly roll-up, of course. We got a glimpse of October. Earlier this week. I thought it was action.

David Hoffman:
[1:31] The month was green between the days of Monday through Wednesday of this week. Yeah.

Ryan Sean Adams:
[1:35] Yeah. I thought we were back, baby. But Powell... Then Powell's speech happened, and it seemed like he gave us everything I thought we wanted, but the markets hated it. We've got to talk about that. What spooked markets? Why are we going down?

David Hoffman:
[1:47] We've got some crypto-native tokens to talk about. Mega ETH hit its ICO target within minutes. It is now 28 times oversubscribed to the Mega ETH ICO. We also have the MonEd token to talk about. We've got valuations for both of those. And from the words of a Polymarket executive, we have a Polymarket token to talk about as well.

Ryan Sean Adams:
[2:10] Yeah, and the CFTC got a new nomination finally. They've got a chairman coming in. Also, JP Morgan tells us exactly how much the base token would be worth. Stay tuned for the answer there if, of course, Coinbase launched a token. And Solana racks up two wins on the week. They got an ETF, their first staking ETF in size out there. They're also Western Union launching a stablecoin exclusively on Solana. There's a bit of controversy about that. And lastly, CircleArc, layer one. Remember they were doing that? They went to Testnet right now. And their marketing? Dude, their marketing?

David Hoffman:
[2:46] Pissed Ryan off.

Ryan Sean Adams:
[2:48] I was a little chafed. It kind of triggered me. So we'll talk about all that and more. But David, before we do, we got to talk about 20 days until the Bankless Summit. This is the Bankless Summit. Where is this happening? What is it? Why are you so excited about it?

David Hoffman:
[3:02] This is in DevConnect. So this is the second day of DevConnect, the Tuesday. So if you're going down to Buenos Aires for DevConnect, this is, we are taking over the whole Tuesday, which is the first really day, because the first day is all of the EF day, Ethereum day. So second day is Fake the Summit day. So many speakers. Tamash from the EF, Onsgar from the EF, Luca from Layer 2B is talking about native roll-ups. We got Mariano Conti, Arjun Bukhtami, a second to Luca from M0. Donkrad, who was previously on the EF, he previously had a little ETH logo, now he has a Tempo logo, And we're going to get some of the first words from Tempo about the relationship with Ethereum. That's going to be Donkrad's talk. I'm pretty excited for this. This is going to be the last time you are going to hear from me about the Bankless Summit. Because Ryan and other people in the crypto ecosystem are taking over the roll-ups because I'm about to be traveling. And so you have no further warnings to go get your Bankless Summit ticket before we sell out. We are close to selling out. We are going to sell out. If you get yourself down to Buenos Aires and you haven't got a Bankless Summit ticket, you might not get one. So this is your final warning to go get your Bankless Summit ticket. And then we have an after party after the fact. If you buy your ticket, you'll be also emailed another link to go sign up for the Bankless after party, which is happening at Fedes from Landoclass, his wine bar. It's a great wine bar. Love Fedes. So we have a whole bankless day of first content, then wine. It's going to be great.

Ryan Sean Adams:
[4:26] I mean, that's going to be a very high talent per capita room. You know, some L1 recruiters should probably go get there and pick themselves up some Ethereum and researchers, huh? Maybe Tempo should go. Yeah, Tempo should go.

David Hoffman:
[4:38] Come recruit. Yeah, I also forgot to say, Vlad from Leiter also just signed up to speak. That is actually the first time that has been released, but Vlad is coming in all the way from Europe to talk.

Ryan Sean Adams:
[4:48] I'm so bullish about Leiter. I think they're doing L2's God's way.

David Hoffman:
[4:54] Vitalik's way, dude.

Ryan Sean Adams:
[4:56] Same thing. Let's talk about prices first. Let's give the picture before the FOMC meeting, before Powell's speech, okay? So this is, I'm actually, no, this is not a crypto price chart. This is the S&P.

David Hoffman:
[5:09] Yeah, I was like, that's way too awesome looking to be a crypto chart.

Ryan Sean Adams:
[5:12] Yeah, that's too good. The S&P hit a high. It hit a high on Wednesday, earlier this week. All-time high. So stocks at all-time high. NASDAQ similar, all-time high this week. Actually, the NASDAQ and the S&P are like pretty similar right now. It's all MAG7. You're looking at one trade here, which is the AI trade, of course, that dominates the markets. Yeah. All-time high. and then it went down and so did crypto. So crypto is not all time high. But it was doing well up until Wednesday. So Bitcoin had recovered above $115K, and Ether had recovered a little bit too. It was above $4,000. So $4,232. And then we got Powell's speech. And where are we right now on prices for the week?

David Hoffman:
[5:56] We are down on the week. Like I said earlier, we had nudged green. So there was a moment in time where we were green on the week and also on the month. We are now down. Both Bitcoin and Ethereum are down 1.5% on the week, each $108,000 for Bitcoin and $3,800 for ETH.

Ryan Sean Adams:
[6:13] Okay, so what happened? We're going to talk about that. One thing I want to say, though, David, is there's still some hope out there lurking for the gold catch-up trade. And this is none other than Sir Tom Lee saying it's worth keeping an eye on what happened with the gold top in 2020 and Bitcoin following that aggressively after gold topped in 2020. Bitcoin had its top just mere weeks and months later. And that same thing could be playing out right now. So we still got some gold catch-up trade. It's not happening in October, okay?

David Hoffman:
[6:46] There's still a chance.

Ryan Sean Adams:
[6:47] We could save that for November and December. So why were we up originally? Well, it seemed like we just had some good news, right? So stocks were performing well. CPI, there was a CPI report earlier this week for September, And it came in at about 0.3% for the month. So that was 0.1% lower than expected. So CPI was doing well. I think markets were anticipating a Fed rate cut and going in. So the week was getting bullish. And then Jerome Powell came in and he gave his speech. And what did he say? This is the tweet.

David Hoffman:
[7:28] He said Fed rate cuts by 25 bips, second rate cut in 2025. That was according to the plan. The Polygon market predicted this. There was Mirren who dissented in favor of 50 bips. That always happens.

Ryan Sean Adams:
[7:41] He wanted more. That's Trump's guy.

David Hoffman:
[7:43] Yeah, he always wants that. There's another one who dissented in the opposite way for no rate cuts. And then the Fed says it will stop shrinking its balance sheet on December 1st, which I'm like reading that. I'm like, whoa, whoa, whoa, whoa. We're going to stop shrinking the balance sheet. That means we are going to... That's like... That's effectively buy pressure. Or the removal of sell pressure.

Ryan Sean Adams:
[8:05] That's right. The removal of quantitative tightening.

David Hoffman:
[8:07] The removal of quantitative tightening. So like QE-ish. QE adjacent. So that's bullish. And then they said... The Fed says downside of risks to employment has risen. So that's kind of like scary. But otherwise... It feels like we're in a lining of the stars. So, like, what's going on here?

Ryan Sean Adams:
[8:25] Doesn't that feel like everything we, like, were hoping for? Yeah.

David Hoffman:
[8:28] Everything we want, everything we forecasted? Bing, bing, bing, bing, bing. Let's fucking go to the moon. I thought, what was the plan? How's the plan?

Ryan Sean Adams:
[8:35] All right. Well, I think one question before we get to why markets reacted in the opposite direction. Maybe we'll flesh out some of the things you said. So, of course, the rate cuts is fairly straightforward. 25 bps rate cut. So, that happened. But this whole quantitative tightening thing and that stopping, like what exactly does that mean? There's a question posed to Lynn Alden. They asked, is this basically money printing? Is this QE now? What is this? Lynn Alden says it's money printing. Whether it's QE or not is more semantics. That part doesn't matter. The Fed won't ever call it QE. Of course, they won't since it's not duration and it's not for explicit economic stimulus. To take a look at the Fed balance sheet, which is what we're talking about, and QT, which has been happening, you have to look at this chart. So this is the Fed balance sheet since 2008 or so. And you can see the regime that we've been in since 2022 is basically quantitative tightening. So the Fed balance sheet, believe it or not, I mean, fiscal stimulus, fiscal dominance, U.S. debt has been skyrocketing. But the Fed balance sheet has shown some restraint since 2022. They've been tightening the balance sheet.

David Hoffman:
[9:49] So the ADAIQ way to articulate this chart is when the line goes up, it means the Fed is buying our bags. And when the line goes down, it means the Fed is dumping on us.

Ryan Sean Adams:
[10:00] Well, yes, it means when the line goes up, there's money printing. They're literally printing money out of thin air. And when it goes down, they're actually burning money. So they're actually destroying money. Yeah. Okay. This is a really interesting chart. So it was, you know, total assets were about 8.9 million near the peak. Billion. Excuse me. Trillion. What denomination am I in? Trillions.

David Hoffman:
[10:25] 8.9 million millions or something like that.

Ryan Sean Adams:
[10:28] Yes, that's trillion. 8.9 trillion in 2022. And then we've been going down. So now we're at about 6.6. So what the Fed is basically saying, we're no longer going down. So this line will no longer go down. It won't necessarily go up, but it will stabilize. And if you look at this chart throughout history, David, you go back to before the great financial crisis, we were in the millions on the Fed balance sheet. This was like normal times. And then what happened, you can see, after the great financial crisis, we started to get, do you remember QE1, QE2, QE3? You could see that on the chart. That was like money printing one, money printing two, money printing three. We went from 800 billion on the Fed balance sheet to 4.4 trillion by 2014. So in the course of, that was the great financial crisis. And then things smoothed out for a bit. And in fact, we got into a quantitative tightening regime. So showed some discipline, showed some constraint up to about 2019. And then there was some rockiness in the markets.

David Hoffman:
[11:33] Yeah, the repo markets did not like that.

Ryan Sean Adams:
[11:35] That's right. And then look at this spike. When does this spike happen?

David Hoffman:
[11:39] COVID.

Ryan Sean Adams:
[11:39] COVID spike.

David Hoffman:
[11:41] Boom. And COVID was just the excuse of just like, yo, we need to react hard and fast. And also our constituents are going to love it if we helicopter them money.

Ryan Sean Adams:
[11:48] This was unlimited.

David Hoffman:
[11:49] Let's go to the money printer.

Ryan Sean Adams:
[11:50] This was unlimited QE. And basically we did it in a hurry. And then we shoot from like 4.1 trillion all the way to, let's see where we were at the top in 2022. So that's the story of this line. Where we're actually going to see the money printing is probably not in this line. This is going to stabilize, but it's probably going to be on bank balances. All right. So what we'll see likely in the months ahead into 2026 is some additional additions to bank reserves, which is the equivalent of Lynn Alden saying it's money printing. And that's going to go on the commercial bank balance.

David Hoffman:
[12:30] Money printing with extra steps.

Ryan Sean Adams:
[12:32] Yes. So this chart will not necessarily go up, but this one probably will. And that's more money printing. So Peter Schiff has some words about this. What's he say?

David Hoffman:
[12:44] He says that despite rising inflation that's 50% above target and 4K gold, the Fed made the mistake of cutting rates again. Also, with a $6.7 trillion balance sheet, the Fed is prematurely ending QT in December. This proves Bernanke was wrong. like a banana republic, the U.S. did monetize debt. Actually, can you help me understand what he means?

Ryan Sean Adams:
[13:05] Well, he's just saying, you know, that $6.7 trillion, that's on this chart right here, right? It's no longer going down. And if you think of the $6.7 trillion, that's money the U.S. owes itself. Kind of weird, right? Yeah. That's money that effectively, you know, like the Fed owes treasury. Yes. And so if you add that $6.7 trillion and then you add the $40 trillion or so, I don't know, 38, 39 trillion in U.S. debt that we have. That's our total debt. So he's just saying, like this is the Peter Schiff talking point, right? He's just saying now we've, switch to an easy money regime. Like we're not ready to take any of the pain that it would actually require to be more disciplined in this in this line over here. That's what you're saying.

David Hoffman:
[13:51] The Bitcoin argument is that we're never ever going to take that pain. We're just going to inflate because it's the least painful way to solve that problem.

Ryan Sean Adams:
[13:58] How dare you call that? This is Peter Schiff. That's the gold argument, sir. It's not the Bitcoin argument. Okay. That's the gold argument.

David Hoffman:
[14:04] I listened to Peter Schiff on ThreadGuy and we've done an episode with Peter Schiff and I go over to ThreadGuy I'm like alright ThreadGuy let's see what you got can you get Peter Schiff off of his algorithm off of his gold stump no you can't get Peter Schiff off the stump speech no of course not he's got one mode he's got one mode yeah.

Ryan Sean Adams:
[14:23] I heard there was going to be a Peter Schiff CZ debate yeah are we going to talk about that that's like pure entertainment right there dude

David Hoffman:
[14:30] Although we.

Ryan Sean Adams:
[14:31] Did have that episode earlier this week recorded with Luke Roman did that make you more bullish on gold because that was his This whole platform.

David Hoffman:
[14:37] Yeah, it did make me more bullish on gold. Yes.

Ryan Sean Adams:
[14:40] Yeah, I feel that for sure. All right. Let's get back to the main thread, which is like,

David Hoffman:
[14:46] Why did the markets? We still haven't answered the question why the markets went down. Because like we said, we were getting everything we have said so far is bullish. Why did the markets go down?

Ryan Sean Adams:
[14:54] Let me tell you why. Let me tell you why. OK, so in addition to all of the things that Powell is doing with Easy Money, he said in In the committee's discussions in this meeting, there were strongly differing views about how to proceed in December. Remember, you mentioned those two different governors having differing views. And he said this, a further reduction in the policy rate at the December meeting is not a foregone conclusion far from it.

David Hoffman:
[15:19] OK, wait. So the last time we brought up the poly market to talk about Fed rate cuts, we were like, and then we can go to the next one. We are currently at the next one, and when we checked in on it, it was like 90% chance. The October one, yeah. The October one. That's where we are. It was a 90% chance we were going to cut 25 bips. And then we even went to the December one, and the December one has something like an 85% chance that we were going to cut 25 bips. That's right. You're saying what Powell just said is the December one, he's like, there is less consensus about cutting in the December meeting than there was previously, which is actually what you're showing on the chart with Polymarket. So the odds kind of like plummeted from almost a sure thing to now just a mostly likely thing?

Ryan Sean Adams:
[15:57] That's exactly right. So they plummeted from 90% certainty that we'd get a 25-bit decrease in December. So this would happen December 9th and 10th, all the way down to a 70%. And so the

David Hoffman:
[16:09] Markets were like- And the markets jittered that much?

Ryan Sean Adams:
[16:11] Yeah.

David Hoffman:
[16:12] It's because- I'm calling shenanigans.

Ryan Sean Adams:
[16:15] No, it's for guidance, right? That's what the Fed is effectively given. And so everyone like reads these lines, like, listen to this, David, a further reduction of policy rate December meetings, not a foregone conclusion. Don't you price that in market far from it. That's what you said. And so the markets didn't like that.

David Hoffman:
[16:34] Yeah, I'm I'm calling shenanigans on the market. I think the market's just being jittery and I will stay convicted in my bullishness.

Ryan Sean Adams:
[16:44] You're bullish till the end of year.

David Hoffman:
[16:45] I'm unfazed. I'm unfazed. I think the Fed knows exactly what it's doing when it says, hey, we are not totally sure about like, hey, market, don't be so sure that we're going to cut. And then in the background, they might be like, we're totally going to cut.

Ryan Sean Adams:
[16:59] I mean, if Powell doesn't cut, he gets fired by Trump, right? There's some immovable forces out there. I mean, and to say the market coughed up, like it didn't really that much. So after this, S&P fell 1%. It's just we felt that a lot harder in crypto.

David Hoffman:
[17:12] I mean, 1% in the S&P is kind of a lot. That's a lot.

Ryan Sean Adams:
[17:15] But I mean, what is like 4% or 5% in crypto? So it just, it hurt us more, didn't it? Because the markets in crypto were already jittery.

David Hoffman:
[17:22] Yeah, we're already in like a compromised position. Like there is fear in the crypto markets right now, which is also kind of why I'm bullish.

Ryan Sean Adams:
[17:29] Okay, so somebody asked Powell, they were like, hey, Powell, is AI in a 1990s style tech bubble? What do you think he said?

David Hoffman:
[17:37] I don't know.

Ryan Sean Adams:
[17:38] Do you know what he said? What? This is an actual quote. This is different.

David Hoffman:
[17:43] This time is different?

Ryan Sean Adams:
[17:44] He didn't say this time. He said, this is different. He said, in the sense that these companies, the companies that are so highly valued, actually have earnings and stuff like that. Stuff like that. So Powell's like, no, there's some earnings. here in contrast to the 2000s tech bubble it was all just like business plans and eyeballs and

David Hoffman:
[18:05] Advertising you could you could spin up a website and ipo for like a bajillion dollars that's not what's going on right now that's.

Ryan Sean Adams:
[18:11] What we would like to believe right

David Hoffman:
[18:12] Yeah i don't know if anyone truly knows they're in a bubble when they're in a bubble i.

Ryan Sean Adams:
[18:17] Actually don't like that powell's saying that it makes me feel like we're more likely to be in a bubble if he's saying we're not in a bubble anyway

David Hoffman:
[18:26] You were in crypto in 2017 in November December of 2017 did you know we were in a bubble.

Ryan Sean Adams:
[18:32] No, like in, well,

David Hoffman:
[18:34] Because that was the frothiest bubble of all time. In crypto, you're talking about. In crypto, in crypto.

Ryan Sean Adams:
[18:38] Yeah, for those that were there, for those that remember.

David Hoffman:
[18:40] It was insanity.

Ryan Sean Adams:
[18:42] Yeah, but in those moments, everyone's so kind of like drunk, right?

David Hoffman:
[18:46] I was so drunk.

Ryan Sean Adams:
[18:48] You're just drunk on the market. Yeah. You know, and that's maybe why we're not in a bubble. But although, so do you see OpenAI raising at one trillion, like potentially going public at one trillion?

David Hoffman:
[18:58] Yeah, that one.

Ryan Sean Adams:
[18:59] There's some drunk people out there. It's not in crypto. So there's some drug people out there, though.

David Hoffman:
[19:03] Yeah.

Ryan Sean Adams:
[19:04] Okay, so that's the story about markets. I guess maybe one additional story that's kind of good and should be bullish, but whatever, it wasn't on the week, is their major news, the Trump and President Xi in China, the 100% tariff on China is no longer live. Apparently they had good talks. And this is the taco trade, right? Trump always chickened out.

David Hoffman:
[19:26] He didn't chicken out, Ryan. He was negotiating.

Ryan Sean Adams:
[19:29] Yes, he was negotiating. But this is the conclusion from the Kobayashi letter. This round of the U.S.-China trade war is over, basically. President Xi will be visiting the U.S. after an amazing meeting. It had just like such a great, amazing meeting, David.

David Hoffman:
[19:43] And this is the thing, the whole China trade war thing was the thing that jittered the market. And now people in crypto still have fear that the cycle is over. And the trade war is over. But then some crypto people are like, the cycle's over.

Ryan Sean Adams:
[19:56] Yeah. Well, you know what? This was also some news on the week that didn't make me feel great, which is like, Amazon, it felt like out of nowhere, but they're like, yeah, we're going to cut 30,000 positions. 30,000.

David Hoffman:
[20:07] 30,000. That's like more jobs than are in crypto.

Ryan Sean Adams:
[20:11] I think so. It's probably a lot more, honestly. 30,000 positions. And this is Morning Brew with some other job cuts like Target cutting 1,800 roles, Paramount cutting 2,000 jobs. So there's some cost cutting. And what all of these have in common, or at least this is the narrative, is automation, AI adoption. That's the reason that some of the labor forces are being cut. This goes back to Powell's comment that labor markets, I don't know, they're looking a little unsteady so that's something to watch too and i think goes into the jittery feeling just like in general even though oh my god we're only like we're just off all-time highs in the stock market

David Hoffman:
[20:50] Yeah i mean the stock market climbs a wall of worry like layoffs i don't think are that crazy but that's a big one at the same time i would like further analysis and like information to come out about some of the reasoning behind it because like i think it's easy to say like yeah it's ai but like i don't know if that's really the complete truth yeah probably.

Ryan Sean Adams:
[21:09] Not i mean but Jeff Park makes the point. Amazon laying off 30,000 people is all you need to know of why the Fed is in this paralysis right now and why Powell toned down some of his comments, I guess.

David Hoffman:
[21:21] Because they don't wait. But if there are big layoffs, he would want to cut rates, though. Right?

Ryan Sean Adams:
[21:29] Um... Yeah, I guess he would. You know, so I don't know. This could push them in one direction.

David Hoffman:
[21:36] So layoffs plus a, like, a strong market, I think is actually kind of bullish because you have even more reason to cut.

Ryan Sean Adams:
[21:46] Oh, okay. You want to get into the Powell speculation game too, huh, David?

David Hoffman:
[21:50] Yeah, yeah, yeah. Okay, okay. So I was wrong about the number of people that are employed by crypto. I mean, I don't know if anyone really knows. Are you serious? I just asked ChatGPT thinking about it, so it thinks a decent amount. And it says, what's likely today, 200,000 to 250,000 total jobs.

Ryan Sean Adams:
[22:06] What?

David Hoffman:
[22:06] Yeah, wow. No way. That's big, yeah. I can't believe that. I don't believe that. Yeah.

Ryan Sean Adams:
[22:11] Maybe. I mean, what are they counting? Who knows what they're counting?

David Hoffman:
[22:14] I have no idea. All right. I have no idea.

Ryan Sean Adams:
[22:16] Speaking of financial markets, I guess, in general, the Solana ETF went live. Actually, this is the big one that people were waiting for. And how did it go?

David Hoffman:
[22:27] The real non-janky Solana ETFs, the one that's existed prior to this. I think technically the technical term is called janky. But no, we have some real ones. B-Sol has started with Bitwise's Solana. $56 million of volume. Sorry, is that volume?

Ryan Sean Adams:
[22:45] Yeah, that was final tally of day one trading. So that's net inflows, I think.

David Hoffman:
[22:51] Net inflows.

Ryan Sean Adams:
[22:52] Actually, I have updated numbers. So 70 million net inflows for BESOL. That's Bitwise's one on day one. And then day two, actually 72 million. And Eric Balchina said, this is the strongest ETF launch this year. Of course, like, you know, Ethereum and Bitcoin were last year.

David Hoffman:
[23:09] There's only been this one.

Ryan Sean Adams:
[23:10] Nah, there was Litecoin. I don't know. There's been some others, haven't there?

David Hoffman:
[23:14] I guess he's saying, ETFs globally. Yeah. So like with a gangbuster Bitcoin and Ether ETFs, I would expect that the Solana ETF would also have similar momentum.

Ryan Sean Adams:
[23:26] Yeah. And it kind of has done that, at least at first. So Bitwise, Grayscale, Franklin Templeton, those are some of the big names. Notably absent is BlackRock. They're not doing a Solana ETF at this point. But James Safer said, you have to remember Solana's market cap is 5% of Bitcoins and 22% of Ethereum. if they keep the flows that we've seen for ETH and Bitcoin, ETS. So again, we're just a couple things into this. We don't know. But that would equate to 3 billion in flows in the next 12 to 18 months. I think that's possible. That's also a big if. Like if there is Bitcoin, Ether level institutional demand, it could do this. Solana traded down on this. This is fully anticipated. The market's priced in. It's just down.

David Hoffman:
[24:11] Yeah, yeah, yeah.

Ryan Sean Adams:
[24:12] Just the way everything else is down.

David Hoffman:
[24:14] Interesting that BlackRock, of course, has Bitcoin and Ether ETFs. We've talked to the BlackRock team. They're like, yeah, we're not launching a sole ETF because we don't see sufficient demand to justify it, which gives Bitwise a way they don't have to compete with BlackRock in the Solana market. So I'm sure Bitwise is very happy about that.

Ryan Sean Adams:
[24:31] Yeah, that definitely must be nice. David, Ethereum, ETHZilla. So this is a DAT. I think they were number four, number five. They sold some Ether on the week.

David Hoffman:
[24:40] Yeah, this is the first time an ETHDAT has sold ETH. And they did that after the ETHZ, which is the ticker for ETHzilla, was materially under NAV for a sustained period of time. And so they announced that they are buying back $250 million of its shares with capital funded by selling ETH. And then that brought the premium to NAV much higher.

Ryan Sean Adams:
[25:06] So to be clear, they have $250 million in buyback authorization. They only did $12 million.

David Hoffman:
[25:14] $12 million. Oh, wow.

Ryan Sean Adams:
[25:15] But the point is they sold some ETH in order to buy back their shares. And a lot of ETH bulls were like, Ethereum, DATs aren't supposed to sell. They're only supposed to buy. How dare you? That's what Tom Lee does. He only buys so far, right? What's your take on why they sold? Is this a big deal? What do you think?

David Hoffman:
[25:32] Oh, yeah. I mean, if you're the whole, in theory, as a purchaser, as investor into one of the DATs, if you buy a DAT below one MNAV, you're like, well, I'm buying discounted ETH. And because this company is totally going to sell their assets to return the MNAV to one. And so it's kind of like rational there, because in theory, the stakeholders of a DAT ought to be the first class citizens. rather than the asset underneath. And then the Ethereum people are like, no, no, no, you guys, you're supposed to just buy and hold ETH forever. You're supposed to never sell. And so like, yeah, so the E to Z holders, the shareholders, they're supposed to be the first class citizens. And so this is aligned with that, which makes sense to me.

Ryan Sean Adams:
[26:15] And they were happy about this. Price was up 14%, right? Closer to MNAV of one, they're still under. But the MNAV was like, I don't know, 0.6 or something? Yeah, it wasn't great. It was ridiculous.

David Hoffman:
[26:25] Yeah, yeah, yeah. So like that, that makes sense. I think the bigger question is like the game theoretic question is like, what does this do for forward momentum of ETH Zilla? Does this bolster investor confidence and lead to more people buying the ETH Z asset? Or does this make ETH Zilla seem weak because they had to sell ETH and now the total amount of ETH on the balance sheet went down? Even though ETH per share went up, total ETH went down.

Ryan Sean Adams:
[26:52] You want ETH per share, you want volume of trading in the stock, and you also want total ETH to all go up, and some of those things are in conflict right now. So I don't hate it, whatever. What's coming up next?

David Hoffman:
[27:04] Coming up next, we're going to talk about the Mega ETH public sale being materially oversubscribed. We're going to talk about the Polymarket CMO confirming the Poly token. We're also going to talk about the Monad incoming token and the valuations for both Monad and Mega ETH, and the base token, which is, you know, they didn't confirm the base token.

Ryan Sean Adams:
[27:23] But JPMorgan is- We can speculate on how valuable it is.

David Hoffman:
[27:27] JPMorgan is speculating on how valuable it is, and so we're going to talk about that and more. But first, a moment to talk about some of these fantastic sponsors. We've got three of the probably most exciting tokens launching this year to talk about, MegaEth, Polymarket, and Monad.

Ryan Sean Adams:
[27:40] Or maybe soon to be launching. Soon to be launching? Yeah, we'll see.

David Hoffman:
[27:43] Yeah, well, I said three. MegaEth, Polymarket, Monad.

Ryan Sean Adams:
[27:47] Oh, right. Yes.

David Hoffman:
[27:49] Polymarket might be next year. Whatever. We're going to talk about them right now. So MegaEth ICO reached their target within minutes. So the sale for MegaEth hit its $50 million limit inside of just a few moments of it being launched. And then the allocations continue to flow in. So it was like a three-day long sale or whatever. We are now 28x oversubscribed.

Ryan Sean Adams:
[28:11] How was the sale conducted? This wasn't like a 2017 ICO, right? Was this on Kobe's platform?

David Hoffman:
[28:17] Yes, this was on Kobe's platform, Sonar, which is the more public version of Echo, which is where Echo started. So this is a public ICO. So you had to be an accredited U.S. investor or a non-U.S. investor. And then you had to kind of go through a KYC process and you had to pass a test of investor sophistication. So there were some frictions. You know, the ICOs of old were like, send ETH here and get back tokens and I don't care who you are.

Ryan Sean Adams:
[28:45] It may have been illegal.

David Hoffman:
[28:46] It may have been slightly illegal, but it was fun.

Ryan Sean Adams:
[28:50] Well, you think this is fun too, right? You think this is a good thing. I saw you tweeting on this. I think ICOs are back.

David Hoffman:
[28:56] ICOs are just like, remember when we did the whole airdropping farm meta? So we had airdrops, which were great, but then they got abused. And then we had the points and that was okay, but then they got abused. Everything has gotten abused. Yeah. And I feel bad for some of the orgs that had to deal with this being the brunt of the abuse because they had to deal with inferior token distribution mechanisms because that's just the environment that they were created in. Thanks, Gary. ICOs are just an ungameable token distribution mechanism. And they just ask retail investors, like, hey, put your money where your mouth is. Like, are you bullish this thing? Or are you just farming the token on Twitter and on Discord?

Ryan Sean Adams:
[29:37] It is cool. I mean, it does kind of suck that we have accredited investor laws, though, right?

David Hoffman:
[29:41] Yes, agree.

Ryan Sean Adams:
[29:41] Because that's just like, that totally limits it. But that's the law. That's the law.

David Hoffman:
[29:47] The law should go away, but that's the law that we have. Yeah.

Ryan Sean Adams:
[29:50] So this is better than that. And your experience was good with this. Were they underpricing these tokens in the ICO as well?

David Hoffman:
[29:57] I mean, you tell me. They priced the sale between $1 million and $999 million. valuation. And so the idea is like when you submitted your bid, you could submit up to $186,000. The speed of light was the fun fact. It was like the speed of light was like the limit.

Ryan Sean Adams:
[30:16] Of how much you could invest.

David Hoffman:
[30:18] Of how much you could invest. And you would also price. You would also price it. And then enough people priced it at $999 million that likely anyone below that is not going to have their bid accepted.

Ryan Sean Adams:
[30:29] Oh, okay. So that was basically everyone bought it in at a billion. I'll round that to a billion dollars.

David Hoffman:
[30:34] Yes. The reason why it's $999 million is because they wanted it to be not a unicorn. So retail investors could buy in a pre-unicorn valuation.

Ryan Sean Adams:
[30:44] Oh, technical. Technical for unicorn, yeah. But this is probably undervaluation, right? Considering that kind of the futures markets right now that are valuing this higher than the billion?

David Hoffman:
[30:53] Correct. We'll talk about the futures markets after we talk about Monad. But yes, you are correct. This is coming in under market, which is why it's oversubscribed so much because everyone's like, oh, the futures market are pricing this way higher. this is at least a 3x so i'm going to go fat max bid wow.

Ryan Sean Adams:
[31:08] This participation is blowing my mind is this true 100 000 users kyc over 70 000 twitter users 100 000 participate

David Hoffman:
[31:16] In this yeah i think crypto is bigger than we're giving it credit for dude maybe.

Ryan Sean Adams:
[31:20] We do have 260

David Hoffman:
[31:21] 000 people this is inclusive of asia too so like mega eth has pretty good asia connections so like all of asia is getting involved with this. Yeah, yeah, yeah. 5% of the tokens were sold, of the total supply. And so, And then if you accepted a one-year lockup, you got a 10% discount. And if you were an American citizen, you had to accept the 10-year lockup, or excuse me, one-year lockup. And so right now, the ball is in the mega-Eth court, so they have all the bids. And so now they are manually going through and approving or denying people based on who they are, their on-chain activity. And so if you were, for example, a depositor into the CAPS program, shout out to anyone who listened to that Bankless episode, you got favorable allocation. Wow. That's a mega ETH project. It's a mega ETH project. Yeah. So there were some criteria to boost your chance of having an increased allocation.

Ryan Sean Adams:
[32:17] That's great. I saw some estimates of what the FDV could end up at, but of course it's probably bullish people who are looking at this. But this one account was trying to project actual revenue. So this is supposed to be a rev generating token, right? And I don't know. You could read all the details I'll include a link in the show notes, but in the base case, this person says about $300 million in revenue per year is what MegaEth could off-put, which means $10 billion FDV. So if that's the case, people got to steal on this.

David Hoffman:
[32:48] I don't know how he's backing into that valuation.

Ryan Sean Adams:
[32:50] Might take some time to play out. Let's just say that.

David Hoffman:
[32:53] Okay, next up, talking about Polymarket. So this is an interview on a podcast with Matthew, the Polymarket CMO. Let's go hear what he said. There will be a token. There will be an air draw. And, look, I think, you know, we really pride ourselves on being the most thorough company we hope to be in the world, right?

Ryan Sean Adams:
[33:18] That was it. That was it. Token.

David Hoffman:
[33:19] There will be a token. We didn't really need to listen to the second half of that. It was like, there's going to be a token. There's going to be an airdrop. Like, okay.

David Hoffman:
[33:26] Confirmed. Sounds good. I mean, it was tweeted out by Shane last week, but now we have somebody who just said, yeah, there's going to be a token. The most nonchalant token announcement I've ever seen in crypto. Yeah.

Ryan Sean Adams:
[33:36] You know, this will probably be, I think, our notes are correct about this. This is probably going to happen at a similar time that Polymarket officially opens to U.S. users. That would make a lot of sense, right?

David Hoffman:
[33:48] That sounds like this year. That sounds like this year. There's also going to be an app. The Polymarket app is coming.

Ryan Sean Adams:
[33:53] Yep. A lot of cool things happening in Polymarket. We'll see what that one trades for.

David Hoffman:
[33:58] I was riding the New York subway. Ryan, just go in because I live in New York. And Kalshiats are everywhere. Oh, really? Yeah, they're doing the whole Mom Donnie versus Cuomo.

Ryan Sean Adams:
[34:09] Oh, yeah.

David Hoffman:
[34:10] And it's actually kind of cool to be riding the subway and see Mom Donnie at like 87% and Cuomo to be at 13%. I mean, those numbers aren't cool, but that's aside. The fact that like I'm riding the subway and seeing a Polymark.

Ryan Sean Adams:
[34:24] Where are you seeing this? Are these like digital updated?

David Hoffman:
[34:27] They're digital ads on the subway. And so it's like, oh, I'm in my city and like there's a prediction market data in my subway. That's actually kind of cool.

Ryan Sean Adams:
[34:35] Welcome to the future.

David Hoffman:
[34:37] Yeah, it feels very futuristic.

Ryan Sean Adams:
[34:39] Oh, shoot. I'm showing my box on ModEd.

David Hoffman:
[34:42] How many tokens? Let's see the tokens. Let's see the tokens. It's not, I mean.

Ryan Sean Adams:
[34:46] It's okay, right? I don't, I open these things. I got 88,000 Mon.

David Hoffman:
[34:50] Okay. I don't know if that's good or not.

Ryan Sean Adams:
[34:53] Well, you can open yours. This is the third token, right? The third token.

David Hoffman:
[34:56] The third, yeah. So Monad is doing like three days of Monad or something, like three loot boxes. It's like, it feels like very much like a lottery or loot.

Ryan Sean Adams:
[35:03] Yeah. It's fun. It's a video game.

David Hoffman:
[35:05] It's a scratch off. Monad scratch off. I'm pretty sure the numbers of Monad that you're getting were determined preemptively, like preemptively, but like you do your little like loop box.

Ryan Sean Adams:
[35:13] So it's a PSA for that. Go check.

David Hoffman:
[35:15] Yeah, PSA, go get there your Monad airdrop. People who were not expecting to get the Monad airdrop got the Monad airdrop, so go get it. So are we ready to compare these two things? Because we have perpetual futures for both Monad and Mega ETH. Which, Ryan, do you think is coming in higher?

Ryan Sean Adams:
[35:32] Well, I already know the answer to this.

David Hoffman:
[35:34] Which listener do you think is coming in higher? Everyone place your bets.

Ryan Sean Adams:
[35:39] It's the one I would have guessed.

David Hoffman:
[35:40] Oh, really? Interesting.

Ryan Sean Adams:
[35:41] Yeah, I would have guessed Monad.

David Hoffman:
[35:43] Okay, so $5.62 billion fully diluted for Monad. And $4.3 billion fully diluted for MECA ETH. So pretty close. And these numbers are so preliminary. Futures markets are not accurate price discovery mechanisms.

Ryan Sean Adams:
[35:58] There's not much liquidity out there.

David Hoffman:
[36:00] It's something to go off of. It's fun to talk about.

Ryan Sean Adams:
[36:02] It's kind of a high, like I think it's much higher than the actual spot markets are going to be when these things launch. I do think so.

David Hoffman:
[36:09] Yeah.

Ryan Sean Adams:
[36:10] But the reason I said Monad higher is because I still think there's a little bit of that L1 premium in there.

David Hoffman:
[36:15] Yeah, the pendulum between L2 and L1 premium is on the L1 side.

Ryan Sean Adams:
[36:18] That's right. I think so. It gets a little boost from that maybe. But I mean, they're comparable. Should we talk about the base token?

David Hoffman:
[36:26] Base token.

Ryan Sean Adams:
[36:27] Hypothetically. Remember Jesse? We played that old clip a few weeks ago and he was like.

David Hoffman:
[36:32] They are looking into exploring a network token.

Ryan Sean Adams:
[36:35] Yeah, exploring a network token. Well, I guess JP Morgan has been exploring what the price might be for the base token. And they have some numbers for you. All right. Have you seen? Can I get you to guess what the number is? or have you already seen it? I've already looked at it. All right, I'm not going to make you guess then. All right.

David Hoffman:
[36:50] Let me guess, let me guess, I'll guess. Is it $34 billion?

Ryan Sean Adams:
[36:55] Yes, you're right. JP Morgan says the base token could be worth $34 billion. So they forecast it could go from 12 to 34. So 34 is on their high side. Over time, let's say, and this is based on the current base network usage and some token economics assumptions. their thesis is that Coinbase would launch this that they would Coinbase would take 40% of the supply and the other 60% would be I don't know, airdrop, give it to the community like who knows, how do we do these things and as a result analysts at JP Morgan have upgraded Coinbase's stock price to 404 from the current price at the time, which was 355. So a lot going on here. Like will Base have a token? If it does, how valuable would it be? 34 billion would be a lot considering Arbitrum is like, I don't know, 4 billion, something like that. That's a layer two. We just talked about Mega ETH, a layer two price, like 4 billion as well. So that would be a lot. Coinbase gaining 40% of that. But then And Wall Street, like looking at layer twos and being like, oh, my God, this is adding massive value to the stock price. And they're learning about it, too. So a lot going on there. What do you think of those estimates?

David Hoffman:
[38:10] I mean, so if it's $34 billion, that puts it at number seven in the FDV of the crypto market cap, right behind Solana at $113 billion. Excuse me. Sorry. Seven is USDC. Eight is Lido staked Ether at $32 billion.

Ryan Sean Adams:
[38:27] So you've got to ignore the stable coins, I feel like.

David Hoffman:
[38:29] So, yeah. Well, then Tether's also gone. So it would go Bitcoin, Ether, BNB, XRP, Solana, Base.

Ryan Sean Adams:
[38:35] Wait, wait, wait. Are you sure you're doing this by FDV or are you doing this by MarketCap?

David Hoffman:
[38:39] Oh, I might be doing this by MarketCap. So it would go Bitcoin, Ether, XRP, BNB, Solana, Hyperliquid, and then Base, and then Tron. Hyperliquid's up there? Yeah. At the FDV. Yeah. Uh-huh. $45 billion FDV. Yeah.

Ryan Sean Adams:
[38:55] Okay. Okay. How does that feel? Does that feel right?

David Hoffman:
[38:59] It feels a little expensive.

Ryan Sean Adams:
[39:02] You a buyer.

David Hoffman:
[39:03] I wouldn't be buying that token.

Ryan Sean Adams:
[39:05] All right. Well, good news is you'll have time because they're just exploring it. So you have time to decide whether you're buying it or not. Coming up next, we got Trump about to launch a prediction market because, of course, but Democrats are trying to block him in all ways, crypto. Also, the CFTC got a new chairman. Who is it? Is this person good for crypto? And some impressive traction I want you to tell me about, David, on the X402 payment standard, which we've been supremely bullish on. And we'll tell you why we're excited. So all this and more. But before we get there, I want to thank our sponsors at...

David Hoffman:
[39:37] More chains to talk about. We're going to talk about Circles Arc, the EVM layer one that is going to public test net. So if you don't know where Arc is, that's Circles dedicated payments chain, which they described as the economic operating system for the internet, fostering a platform shift as profound as the launch of the internet itself and subsequent revolutions of social, mobile, cloud, and AI. So no, it wasn't Bitcoin. It wasn't Ethereum. It wasn't Solana. We've been waiting for this. It wasn't Hyperliquid. It is ARK. ARK is going to be the economic operating system that's going to be equivalent to the subsequent revolutions of social, mobile, cloud, and AI. Wow.

Ryan Sean Adams:
[40:24] I found this marketing speak, just like you, David, supremely annoying and slightly triggering. Okay? Just because, like, okay, so ARK, they're doing a Layer 1. Fine. Do a Layer 1. Tempo's doing it. Like EVM, maybe you need that because of stable coins because Layer 2's lack some functionality. Maybe it's not a skill issue. Maybe you really do need a layer one and it's not about getting an L1 premium. But then when you come out and your marketing speak says the economic OS for the internet as profound as the launch of the internet itself and social media, mobile, cloud and AI all combined.

David Hoffman:
[41:05] Wow.

Ryan Sean Adams:
[41:06] I don't know.

David Hoffman:
[41:07] Where's that South Park gif of them smelling their own farts?

Ryan Sean Adams:
[41:11] There's an element of that and i don't know like this could be just a marketing guy like running ahead of uh you know just just running it hot here but it's just kind of annoying to me because circle's been in the space forever usdc has been in the space forever they're not like stripe they're not johnny johnny come lately's they know about decentralization they know about property rights they know about public chains and to just be like guys we solved it we got the layer one that's going to be the economic os for the entire internet right like we figured it out and like launching with like a permission validator set i don't know i

David Hoffman:
[41:45] Like on the section they they have the section on the road to distributed governance they don't even say decentralized they're just saying yeah distributed distributed is good enough.

Ryan Sean Adams:
[41:55] That's good use use that terminology okay that can

David Hoffman:
[41:59] Be your word.

Ryan Sean Adams:
[42:00] Yeah you guys be distributed tell me about x402 there's there's word on the Street, that there was a 200,000% growth in the X402 standard this week.

David Hoffman:
[42:11] That is a true statement, Ryan. You have your facts correct. Yeah, so that's what happens when the X402 payment standard, maybe we can speed run through history. X402 was this like... What would you even call it? Agenic.

Ryan Sean Adams:
[42:27] It's mainly for agenic payments.

David Hoffman:
[42:29] But it goes all the way back to the creation of the web browser.

Ryan Sean Adams:
[42:33] You know how you load a website and it fails, you get a 404 error? That's because that's a standard in the internet. X402 or 402 was supposed to be the payment standard. Never got implemented. PayPal never got around to it.

David Hoffman:
[42:44] So right now it's like 402 payment not satisfactory. Like payment not satisfied. Yeah. Because we didn't have payments. You can't put a credit card in there. Well, technically you can, but like not. You can't really. We didn't have micropayments. Micropayments are very important. That's right. But in the year of our Lord, 2025, we have stable coins and we have micropayments. We have fast, cheap blockchain. So now we can actually fulfill the missing niche in the Sudoku puzzle of the internet with X402. So X402 is this payment standard that's being developed by Coinbase to use stable coins on base, but also Solana or any other EVM chain to like, if you are loading up a website, you might be requested like, okay, to finish loading all of this data, you got to pay me some money.

Ryan Sean Adams:
[43:27] Yeah, and the big thing is agent use of this, like AI use of this, because it's all just machine-to-machine microtransactions, right?

David Hoffman:
[43:34] Yes. There's going to also be human use of this too, but I think it's the automated agentic use of X402 that's really the new thing. So how did we go 200,000%? It's because we went from 25 historical X402 transactions just a few weeks ago. No, no, no, no. Nope. Nope. Oh, 25. Okay. So 25 transactions to 3 million transactions and $3 million in settled volume in three weeks.

Ryan Sean Adams:
[44:07] That's cool.

David Hoffman:
[44:08] Okay, so maybe I said week over week. Maybe it was month over month or something, but whatever. After this one website launched called X402 Scan. And X402 Scan is something like they're kind of doing like the Google thing of like indexing all of the X402 compatible websites and resources and all that kind of stuff.

Ryan Sean Adams:
[44:24] The services, right?

David Hoffman:
[44:24] So it's like it's archiving all the, yeah. So he called it resources. He being this guy that I interviewed, which will be about on the Bankless podcast shortly, Sam from... merit systems. And so I'm sure you're asking, Ryan, how did it grow 200,000% week over month over month?

Ryan Sean Adams:
[44:38] That's one question.

David Hoffman:
[44:40] Meme coins.

Ryan Sean Adams:
[44:41] Okay. Of course. Of course.

David Hoffman:
[44:44] 99% of the activity was meme coins. But the story behind that is like, it's a bootloader. It's a bootloader. Like people don't know what to do. So they're like, you know what, what resource will I have people buy if they load up this website and like, I'll make them buy five cents of my meme coin. and so like that was devs just tinkering around but then also like once some person said like oh there are meme coins here let me go buy them for real and then it got then the flywheel started happening and so this is to me the shot across the bow the the firing pistol the starting pistol of an actual real x402 agentic payments system because before this whole meme coin mania in the fx402 ecosystem there were something like, you know, five or 10 like different economic resources. And I'll talk about what those are that you could call. And now there has been an influx of actual real new resources that you can call with X402. And so here's some of the things that you can do. There's like AI and LLM inference and enrichment. And so you can now call things like ChatGPT, like Claude, and you don't need to sign up. You know, you can just call their API. And you just pay microtransactions to call the API. And you pay microtransactions, yeah. The guy that I interviewed, Sam, he was really a big fan of just like, call the ChatubT LLM, get them to generate a generative image. At the same time, call the Stripe API to get that image put onto a shirt and then have that shirt sent to me.

Ryan Sean Adams:
[46:12] What? Yeah. And by the way, so a human could initiate that call or an AI agent could initiate that call.

David Hoffman:
[46:19] Yeah, so you're typing into your AI browser. It's like, hey, make an image of like a whale doing something and then put it on a shirt and then send it to my friend.

Ryan Sean Adams:
[46:28] Yeah, it'd just be like, so if you type that in a chat, you'd be like, of course, David, I just need access to your crypto wallet, right? And then you give it access to like $5 or whatever and then it would just go buy all the stuff and make it happen.

David Hoffman:
[46:38] Yes, you'd pay for the resources, yeah. And like data and APIs, weather markets, prediction markets, other things, anything you can think of. And that was really the exciting thing of like the amount of developer creativity here is limitless about what they could do with X402. So I think I'm going to get you on board with me, Ryan. We are calling for, An X402 summer.

Ryan Sean Adams:
[47:01] Supercycle. X402 supercycle.

David Hoffman:
[47:03] X402 supercycle. This is a starting pistol. It's only going to get crazier for here. Yeah. And I think it's going to be something to pay attention to. It's a big deal.

Ryan Sean Adams:
[47:11] And it's not just crypto. It's just like, so a lot of... It's the internet.

David Hoffman:
[47:14] It's the internet.

Ryan Sean Adams:
[47:14] It's happening on base right now, which is really cool. But Cloudflare, remember, they got involved. Google has integrated into their AI agent toolkit. This is going to be a big deal. It's something I think we're going to track. Bold, bear market, whatever. The devs are going to build on top of this thing.

David Hoffman:
[47:29] Mike Selig. Congratulations to Mike Selig. We had him on Bankless, actually. So we know who this is. I had him on talking about securities law back in like two years ago, former chair of the CFTC. And then he went into work in law in the crypto space. And now he's back at the CFTC. And so now he is the CFTC chair for crypto oversight. So that's huge news for us. Crypto native guy, very smart, very savvy. And yeah, this is like a big win. The alternative was Brian Quintenz, also crypto native, also savvy.

Ryan Sean Adams:
[48:00] Also on the Bankless podcast.

David Hoffman:
[48:02] Also on the Bankless podcast.

Ryan Sean Adams:
[48:02] They actually only went through, they were like, which previous podcast guest on Bankless can we hire in this position? And that was our selection.

David Hoffman:
[48:11] That's right.

Ryan Sean Adams:
[48:12] Could have been you or me.

David Hoffman:
[48:14] No. No, no, no, no.

Ryan Sean Adams:
[48:16] This is Bullish for crypto. Brian Selig is Bullish for crypto. He knows the space. Mike Selig. Mike Selig. Mike Selig. Sorry, Mike.

Ryan Sean Adams:
[48:24] Yeah, I think this is great. Very exciting. excited to see what happens as a result of this.

David Hoffman:
[48:29] David Sachs tweeted out, President Trump has made an excellent choice in Mike Selleck to lead the CFTC. Mike is deeply knowledgeable about financial markets and passionate about modernizing our regulatory approach in order to maintain America's competitiveness in the digital asset era.

Ryan Sean Adams:
[48:43] Speaking of passions, David, Trump is passionate about doing every single thing he can in crypto these days. So this week, Trump Media is entering The prediction market's business, okay? Competing against Kalshi, competing against Polly Market, and doing their own thing through Trump media. So that's the news on the week. There's no app behind this yet. There's no kind of substance behind it.

David Hoffman:
[49:08] Well, I think it gets integrated into Truth Social. So this is Truth Predict is the platform about democratizing information and empowering everyday Americans to harness the wisdom of the crowd, turning free speech into actionable foresight, embedded it into truth social. So users will be able to bet on sports, politics, commodity prices, and more directly within the platform. So I think this is a part of his already pre-existing social media platform.

Ryan Sean Adams:
[49:32] Is there anything in crypto Trump doesn't have right now? I guess he doesn't have his own layer one, which maybe he should.

David Hoffman:
[49:36] Doesn't have Trump chain.

Ryan Sean Adams:
[49:37] Trump chain. Could happen.

David Hoffman:
[49:39] Should we produce the Trump crypto bingo card?

Ryan Sean Adams:
[49:42] Oh my God, we totally should.

David Hoffman:
[49:43] It's already got a lot of dots on it. NFT collection.

Ryan Sean Adams:
[49:47] Let's see. He's got the ETFs. What else? He's got the borrowing and lending protocol.

David Hoffman:
[49:52] Yes. Prediction markets. He's got the prediction market. He just doesn't have the chain.

Ryan Sean Adams:
[49:57] He needs a layer one. Where's the EVM layer one? That's what we need. We need a new operating system for the internet. That should be the polymarket.

David Hoffman:
[50:05] Does Trump launch a layer one or layer two?

Ryan Sean Adams:
[50:09] Oh, layer two. Imagine if he was like, no, layer ones are scams. I'm going to go with a layer two. Well, speaking of scams, U.S. Congressman Ro Khanna, who is actually a very he's

David Hoffman:
[50:22] A Democrat another Biggest Podcast guest.

Ryan Sean Adams:
[50:23] Yes he is crypto favorable he's a Democrat in Congress he's always been pro-crypto um He actually has had kind of enough of this stuff, of Trump launching things in crypto. And so he's introducing a bill that bans the president.

David Hoffman:
[50:36] Well, I don't know if the prediction market is crypto. I actually don't know if that's true or not.

Ryan Sean Adams:
[50:38] Well, ignore the prediction market.

David Hoffman:
[50:40] All the other things that we have been talking about.

Ryan Sean Adams:
[50:43] Like the mean coin on the bingo card, right? That bans the president and elected officials from owning or creating cryptocurrencies. I haven't read the details of this bill, but this is a Democrat, a backlash that was like obviously going to come. Somebody who's crypto favorable. It's interesting coming from that. I don't agree with not owning crypto. Yeah, I don't agree with that. I don't agree with that, if that's the case.

David Hoffman:
[51:03] Creating crypto, I can get behind that.

Ryan Sean Adams:
[51:06] Maybe. Depends on how you, I mean, I don't know. Creating a meme coin. I don't know. There's some squishy area there. What do you

David Hoffman:
[51:14] Mean creating a meme coin? That's the thing I don't want. A president should not create a meme coin.

Ryan Sean Adams:
[51:20] An NFT, though. I agree with the way it's been done today. But, like, I don't know. Your creator coin on Sora. Like, there's some weird blending that I just, like, I think

David Hoffman:
[51:28] You are finding some exceptions, but I think the broad rule is that, yeah, don't make cryptocurrencies as the president.

Ryan Sean Adams:
[51:34] Definitely don't trade them. It just should be put all this stuff in a blind trust. If you hold crypto assets, put it in a blind trust. Anyway, that's some of the backlash that's coming down the pike there. Pretty predictable, I would say. David, Western Union. Okay, this is the group that... Western Union, you go to a Western Union, right? And it's all about moving funds.

Ryan Sean Adams:
[52:00] What's the word I'm looking for? Remittance. Remittance, of course. Remittance. It's all about remittance. This is how people have done remittance for, I don't know, 100 years or so. Well, they're getting into cryptocurrency. So they're doing a stablecoin and it's on Solana. So big Solana victory lap around that. It's actually kind of a big deal because Western Union remittances were always a thing we wanted to do in crypto, right?

David Hoffman:
[52:21] Yeah, Western Union is like one of those boogeymen about like why we need crypto. And it would actually make sense that like, well, well, if Western Union is going to get disrupted by stable coins, maybe they should have just adopted stable coins. So that makes sense to me.

Ryan Sean Adams:
[52:34] Okay. So this was seemed like a big win for Solana. And indeed it is Western Union. The CEO says like, look, this is a clip. We're not going to play the clip. But he's like, we looked at all the alternative blockchains. It came to one conclusion, dot, dot, dot. The Solana blockchain was the right choice for us. Right. You know, speed, all the things that Solana preaches, it's the right choice. All right? On the back of this, I noticed my timeline in crypto Twitter. I didn't get involved. I don't feel like getting involved with this. I don't know what you know about this, but there was some allegations. Here's a deleted tweet. I can't even find. There's some allegations that the reason Western Union went with Solana was because the Solana Foundation wrote a check to Western Union in the form of an investment or something to just incent them to partner with Solana and be exclusive on Solana for some period of time. six-month period of time. Again, this is a rumor, but this caused some back and forth. Pick up the story from here.

David Hoffman:
[53:30] Yeah. Yeah. So it seems to be that there's a pretty clear level of detail that has gotten circulated around crypto Twitter. And the details that people are saying was that the Solana Foundation paid Western Union $25 million for the development of this program. So if you guys do this, we'll pay you $25 million to do this. And then in addition to that another $25 million to bootstrap the stablecoin that Western Union is producing, the USPT stablecoin. And so then people see that clip from the Solana person and be like, we looked around all the blockchains and we chose Solana because it's the best. Yeah. And then Western Union said this and they're like, did you do that? Or did they just pay you $25 million to do this? So like, there's a little bit of dishonesty around that. If that's the case, again, we don't know the details here. We don't know if there's a payment or not, other than the fact that there seems to be pretty clear specific details of like the two $25 million payments. A couple of people on Twitter went out and said, well, here are the terms of the details again, without like explicitly having the actual deal. There was like chain mudslinging. And so I'll make a few statements.

David Hoffman:
[54:38] This is rational BD behavior from the chains. Optimism did this with Coinbase and Arbitrum did this with Robinhood. These are smart BD things that chains are doing to grow themselves. And that makes sense that we do them. What's irksome about these types of deals globally across crypto is that we, as the market, don't get to know about the details inside of these deals. Instead, they just kind of like emerge from the whisper networks of crypto. And then we're kind of left to speculate on like what's true and what's not true.

Ryan Sean Adams:
[55:12] Like, all the chains are incented to pretend it's all organic adoption, right?

David Hoffman:
[55:15] Yes, pretend it's organic. And look, the Western Union person said, we selected Solana. It's like, that's not what happened. And you got paid for it. You did select, yes. Yeah, you got paid $50 million to select Solana.

Ryan Sean Adams:
[55:27] Allegedly, we don't know the numbers.

David Hoffman:
[55:28] Allegedly, allegedly. If this were Web 2, the announcement would look something like, Western Union is building its payment system on Solana alongside a $25 million investment from Solana to build out the development and also another $25 million investment from Solana into the USPD stablecoin. But this is where Web3 chains are incentivized to make this appear as organic as possible. What's uniquely frustrating about this one is that it seems like the details have been sufficiently leaked. And the Solana representative leadership are saying that's just completely fabricated and false.

Ryan Sean Adams:
[56:03] Like who?

David Hoffman:
[56:04] So the one person that you just had on the screen, who's a Solana exec, said both made up an entirely fictional. That guy. Yeah. Yeah. Entirely fictional.

Ryan Sean Adams:
[56:15] The idea that, so the response is $25 million plus $25 million in liquidity. And he said both made up entirely fictional from the Solana Foundation.

David Hoffman:
[56:26] Yeah. Yeah. And then, like, Lily Liu, who's the president of the Solana Foundation, responded to the claim of, like, a $50 million investment into the project with, like, the $1 billion Austin Powers gif. Okay. Kind of just, like, making a farce of it. Sure. And then, like, Mert, who replied to the person who put out this accusation in the first place, he says, the details of this are extremely off. And I'm like, okay.

Ryan Sean Adams:
[56:50] What are the details?

David Hoffman:
[56:50] Then what are the details, though? What are the details? I mean. Can we please know what the details are so we can know as the market? And like, this is me pointing at Solana. I would also have liked to know the details of the Arbitrum.

Ryan Sean Adams:
[57:05] Robinhood deal. Do we know the details of that?

David Hoffman:
[57:06] No, we don't. Optimism. We know through inference that there was a deal. We do know the details of the Optimism base deal, actually. Those were actually made public. That was nice.

Ryan Sean Adams:
[57:16] It was nice to know that.

David Hoffman:
[57:17] That was nice. The idea of there's not a deal or the details are extremely wrong and not actually being informed of what the deal is and then also being made to appear that this is organic is kind of what I don't like.

Ryan Sean Adams:
[57:30] Yeah, I don't know. I don't have a strong take on any of it. I saw some Solana versus Ethereum back and forth, and there is an element of the L2s do this as well. I will say, if the Ethereum Foundation ever did this, Like, I don't like that. That is not a, to me, when you start doing this sort of thing, you're acting much more like a fintech company.

David Hoffman:
[57:54] Yes. Which is why I said this is smart BD work from these chains.

Ryan Sean Adams:
[57:58] For fintech companies.

David Hoffman:
[57:59] For a fintech company, which is what Solana is.

Ryan Sean Adams:
[58:01] And so are the layer two chains.

David Hoffman:
[58:02] And so are the layer two chains.

Ryan Sean Adams:
[58:04] Yes. They're basically fintech companies with Ethereum-grade property rights is what they are.

David Hoffman:
[58:07] Yes, the layer twos, yeah.

Ryan Sean Adams:
[58:09] In my, like, you know, way of looking at crypto, I see a layer one do this and I'm like, that's a fintech company, you know? Whatever. What a boomer take, huh? What a boomer take. David, we got to finish out this episode with a few, maybe just we'll go through a drive by. There's six things, but acquisitions, banks, IPOs, some news on the week. Okay. First on the acquisition side of things, Aave acquired Stable Finance. If you've not heard of Stable Finance, this is like Aave, which is interesting, started as a DeFi protocol. moving into consumer-friendly DeFi. So Stable is a stablecoin savings app. It makes it super easy to go from your bank to Aave.

David Hoffman:
[58:51] Neobank. It's a neobank.

Ryan Sean Adams:
[58:52] Kind of a neobank. And so this is a little bit of an aqua hire, getting into consumer tech. One of the themes this cycle has been acquisitions. It's interesting to see crypto-native companies starting to do these acquisitions. This is another one, actually. Farkaster and Clanker. I mean, you brought, put Clanker on my radar. What is this?

David Hoffman:
[59:10] I was an early Clanker bolt. Clanker is an account that you can add on Farcaster, saying, hey, Clanker, make me a token with this ticker and with this image. And then it will give you some sort of existential dread-y response. It's like, ah, another token. I hope it entertains you in this brief moment.

Ryan Sean Adams:
[59:30] It's a meme coin launchpad via chatbot, right?

David Hoffman:
[59:33] Yeah, but it's a Twitter account. Or excuse me, it's a Farcaster account. It's kind of funny.

Ryan Sean Adams:
[59:36] Yeah, so Farcaster bought Clanker, basically. It was kind of the new thing. It's been interesting to see, I don't know if you're looking at a Farcaster, but doing great things on their wallet, they're evolving into a sort of a crypto native social media more, doubling down on that, like doing all the token stuff, doing all the NFT stuff.

David Hoffman:
[59:53] Yeah, yeah. Makes sense.

Ryan Sean Adams:
[59:54] Okay. So acquisitions happening in crypto. Banks, all right? Banks entering crypto. This time it's more than PR. We're going to drive by this, but Zelle, okay? I know you have a Wells Fargo account. I know you do. You ever use Zelle?

David Hoffman:
[1:00:08] Yeah. Like, unfortunately, it sucks.

Ryan Sean Adams:
[1:00:11] To like pay landlords and pay, you know.

David Hoffman:
[1:00:13] Not even. My landlord takes a check, and I actually just prefer that. It's better UX than Zelle.

Ryan Sean Adams:
[1:00:20] That's how much David hates Zelle. Well, they're doing a stable coin. Zelle is. Wells Fargo is. Zelle is used by a bunch of banks, including Wells Fargo. 150 Americans on Zelle. So no details on this yet.

David Hoffman:
[1:00:32] 150 million Americans? Yes. 150 million. I mean, I could go either way.

Ryan Sean Adams:
[1:00:38] 150 million. So banks, I think they're actually serious about it. I think banks are like, we're not going to get left behind from stablecoins.

David Hoffman:
[1:00:46] So let's put stablecoins inside of Zelle. That's how they catch up.

Ryan Sean Adams:
[1:00:51] Well, I didn't say it would be great UX, okay? This is another bank. What's this?

David Hoffman:
[1:00:54] This is a Coinbase and Citi partnership. Coinbase and Citi are working together to create a new digital asset payment solutions for institutions. They plan to use Citi's payment network and Coinbase's digital asset expertise to offer these services worldwide. So they are focusing on enhancing fiat on and off ramps to allow Citi's institutional customers to switch between fiat and digital assets through Coinbase's infrastructure. So Citi in the front, Coinbase in the back.

Ryan Sean Adams:
[1:01:22] There you go. Brian Armstrong says, crypto and stable coins are the tools. It's not a debate anymore. We're going to update the financial system. So there you go. Okay, so that's acquisitions, banks, now IPOs. Actually, two interesting ones. This was, I didn't think about this one, but it totally makes sense in retrospect. So Securitize, here we had Carlos on, CEO of Securitize. They're doing Biddle Fund. They're doing all the real world asset stuff. In fact, if you go on the real world asset analytics platform, they're like the leading platform.

David Hoffman:
[1:01:49] Oh, that's a good looking chart, dude. I like that chart.

Ryan Sean Adams:
[1:01:51] Yeah. Yeah, $4.5 billion in real world assets. Anyway, Securitize is IPO-ing. Cool. Which is a good time for them to IPO, right? Yeah. Because they might get some of that love from TradFi that went into Circle, right? They're like, oh, stable coins. And Securitize can be like, well, we have the next thing, which is real world assets. $1.25 billion IPO. Nice. And yeah, do you have any predictions on this? You think this is going to launch hot?

David Hoffman:
[1:02:17] I mean, in the same way that like institutions want access to like some investment themes or narratives and they need the right vehicle to do it. Like real world assets is one of those narratives. Like we saw what happened with Circle. Everyone in crypto was like, I'm bearish Circle.

Ryan Sean Adams:
[1:02:31] The revenue doesn't justify it.

David Hoffman:
[1:02:32] And then at 5X because people needed exposure to stable coins. And now if people want exposure to real world assets, they can do this. And I was snooping around on our YouTube metric backend with Ryan. You know what is a sleeper video that's actually in like our top 20 most popular videos?

Ryan Sean Adams:
[1:02:48] I have no idea. I never go there.

David Hoffman:
[1:02:49] I'm super curious. We recorded it a year ago with Robert Leschner and we titled it tokenizing real world assets. Oh, yeah. And the SEO on that is what we need it to be because that thing, the chart on that thing is just has ground. It doesn't go flat. It just grinds up because people are typing in real world assets into YouTube. I think as people like get comfortable with stable coins, they're going to move down the line. They're going to go into real world assets.

Ryan Sean Adams:
[1:03:14] I think we found the title of the roll up today. Tokenizing real world assets in October 2025. That's one IPO. Interesting. Also, upcoming ConsenSys IPO. So this was more formally announced.

David Hoffman:
[1:03:28] That is interesting.

Ryan Sean Adams:
[1:03:29] Goldman Sachs, the big guns are coming in for this one. I don't have a date yet, but that's happening. JP Morgan and Goldman Sachs, all right? And when I think about ConsenSys and their core assets, it's like really three to me, right? Metamask, for sure.

Ryan Sean Adams:
[1:03:43] Infura, for some of the infrastructure. And Linnea, their L2. Those are kind of the golden eggs, I guess, of that Joe Lubin laid in ConsenSys. with some love from SBET, of course. It was backed by some of the Lubin Capital in the SBET Sharplink Gaming Ethereum treasury strategy. That's going to be an interesting one to watch for sure. I don't know what the financials look like.

David Hoffman:
[1:04:06] Yeah. Consensus has...

Ryan Sean Adams:
[1:04:09] They've been bloated at times.

David Hoffman:
[1:04:10] Cleaning up the consensus books to get ready for IPO must have been a gargantuan effort because, dude, they were paying people in ETH as they should have been back in the old days. They were just building up a company that was not thinking about going public. And I'm sure whoever was their accountant to make their books make sense at all had to rip their hair out for years to make this happen.

Ryan Sean Adams:
[1:04:33] Yeah, but the trend here, David, is we can't just look at crypto native assets anymore. If we want full exposure in crypto, we got to have some brokerage accounts, I guess, stocks. Until our equities come on chain, for sure. So that's happening right now.

David Hoffman:
[1:04:48] Rip to all the consensus equity holders that never got their equity from 2016 to 2020. That's a little bit of a deep cut.

Ryan Sean Adams:
[1:04:57] Wish David well because he is going to Patagonia, I believe, in just a few hours' time. David, come back to us, man.

David Hoffman:
[1:05:03] I will.

Ryan Sean Adams:
[1:05:04] Go find a bull market somewhere up in the mountains.

David Hoffman:
[1:05:07] I'm looking for it.

Ryan Sean Adams:
[1:05:08] All right.

David Hoffman:
[1:05:09] Bring it back to us, please. It's up there somewhere.

Ryan Sean Adams:
[1:05:10] We need some help in November and you'll be there. So, well, we'll see you, I guess, a little bit later in the month.

David Hoffman:
[1:05:15] I'm gone for two weeks. I'll be back the third week of November. And then I'm gone again for one more week. And then I'm back.

Ryan Sean Adams:
[1:05:23] Gotta let you know, of course, climbing mountains the way David does it is super dangerous. Crypto is also risky, though, in a different way. You could lose what you put in. I hope David doesn't lose anything. We are headed west. This is the frontier. It's not for everyone, but we're glad you're with us on the Bankless journey. Thanks a lot.