ROLLUP: Trump vs. The Fed | Staked ETH ETF | The First Stage 2 Rollup | Robinhood's Crypto Pivot

Bankless Nation, welcome to the weekly roll-up where we cover the weekly news, drama, and developments in the crypto space. This is the second week of February, and today on the show I have the pleasure of being joined by Tarun Chitra, the Grand Poomba and GigaBrain at Gauntlet. Welcome, Tarun. Happy Valentine's Day, my man.

Happy Valentine's Day. No one else I'd rather spend it with.

I'm honored. I'm honored. Uh we usually hear you, the grand poomba over at Gauntlet from the chopping block. That's what Hasib calls you. Uh I had Hassib on to help me go through the news two weeks ago, so I guess I'm just kind of like running through chopping block guests. After you, who should I have on? I'm between the two remaining people.

I mean, I think Tom

Tom is the silent killer. You know, we all in all the statistics, he speaks the least but has the most sharp commentary. So

I think

I think he's worth getting off.

I think you're the culturalist of them all, even though you are an absolute math genius, math whiz, you're always up with the times, up with the gossip. So I think maybe this is like a gossip heavy episode.

All right, let's let I'm I'm excited.

We'll get to the gossip at the end. First, we're gonna talk about Trump versus the Fed. Federal Reserve signals no more interest rates, which made Donald Trump a sad boy. Uh, news that no one had on their bingo card, OpenSea announces an airdrop. Arbitrum is just one step away from being a fully decentralized stage two Ethereum roll-up. And also, Vitalik is a communist. Or Vitalik made a joke about communism. No one on crypto Twitter can really tell which is which. So we're gonna get to all this and more, but first we're gonna talk to our friends and sponsors over at all right, let's get into macro. True, I've never actually heard you comment on macro, so I'm interested to hear your takes on the macro markets. Uh the thing that happened this week was that uh hopes for more Fed rate cuts were dashed, as uh Powell noted that the hot CPI means were not quite there yet. Uh, so signaled that we are not going to get any more rate cuts in 2025 due to higher than expected uh inflation. Inflation rose 0.5% month over month, and we're at 3% year over year. The forecast was 2.9%. Uh this uh similar numbers came in uh from the uh CPI. Uh on top of that, the Powell testified in front of Congress this week, emphasizing that the Fed is in no rush to cut interest rates because the economy is strong and inflation remains elevated. Uh, Donald Trump did not like this on Truth Social. He tweeted out interest rates should be lowered, something which should go hand in hand with upcoming tariffs. Let's rock and roll America. Uh, this happened last Trump administration, uh, eight years ago, where Trump went head to head with Powell, really trying to get him to lower interest rates, make a more easy monetary policy environment. Uh, and uh I don't really remember actually how that turned out. Um, but the markets did not like this. S P 500 declined a quarter of a percent. Uh, the treasury yields jumped, which is something we know that Donald Trump does not want. He wants treasury yields to go down. Uh, and then also Bitcoin and crypto markets also uh dipped below. Bitcoin fell below $95,000 when the markets opened Truon. Any macro commentary?

Yeah, I mean, I think the the thing to realize, I guess, about

Trump's posturing is that like a lot of his policies.

Are generally pro-inflation, right? Like tariffs, it's more expensive to buy stuff from outside the US, even if it's cheaper to produce.

Uh, and so I think

his economic policy relies on low interest rates.

And I think in general,

you know, the the world doesn't seem to look like that right now. I I I do wonder though, if like a lot of that overheating

will calm down. You know, I think like post election, there was just like so much of bullion in every market that every price went up

for e you know, every commodity even.

Mm-hmm.

And so I kind of I my kind of belief is that

this quarter it might be very biased by the fact that like all financial markets went up just for like uh unboundedly for like two months, and like now we're kind of getting over the hangover.

And

I think we'll see prices relax a bit.

I think we'll also see responses to tariffs that that kind of uh maybe make some prices cheaper, some prices worse. But

in general, I

I don't know, I I feel like

It is funny that crypto's value prop feels a little bit like 2021 where it's it's uh prediction market on the weekends for what the NASDAQ is gonna do on Monday.

I think that probably is where we end up when we are just going flat. Like you said, the crypto markets are the only thing that's open on the weekend. Bitcoin pretty flat on the week, down 1.8%, which is pretty mellow. Ether down one point uh 2.7% on the week, uh a little bit worse. Continuing its slide against Bitcoin. Ether's at $2,600, which is not a super high price. Uh overall, I wouldn't say this is really any different than price action that we've seen. As we zoom out, Farun, like what are your takes about just like the market as a whole? Uh obviously, we know Solana over the cycle has done very, very well. Bitcoin, because of the Donald Trump presidency, has done very, very well. It's no surprise to anyone, no new news to anyone that Ether has lagged all these things. Just what are your broad takes about the theme of the cycle?

I mean, I do think the new launches, um, like the new chain launches have

been not been good. I really feel like meme coins um becoming popular really killed the kind of

uh launches of new L1s and new L2s uh in terms of token value this year, like even more so than than ETH, right? Like I think ETH.

ETH at least has had ETF inflows. People are trying to launch a staking ETF. You know, like there's like there's some positive news.

I feel like that the the the like

50 to 100 alts, that's where the bloodbath is. And maybe maybe that's not worth talking about because their market cap percentage is shrinking. I think Bitcoin dominance hit like 70% this week

at some point. And so

but I I think the fact that like

the new coin launches have been quite poor relative to expectation has been.

Sort of one of the more surprising things.

Um,

I think Solana seems to have reasonably

kept some, you know, obviously it's down like 30% from

maybe a little more 35% from the peak.

Um,

but yeah, I I

I'm not I I kind of feel like the real bloodbath is is a little bit lower if you go lower down the list.

Yeah. I remember I was listening to your guys' conversation about dispersion. And uh I think you were on one side and Hasiba's on the other, where Hasiba was like, no, there's always been too many coins in crypto to choose from. Um, but nonetheless, it seems to be like you can always get more dispersed. Uh and that long tail below 50 is seemingly really getting stretched as far possible as we've ever seen before in crypto.

I just don't think there's that much new capital going into it versus like

um.

You know, I I think like people not lot making money, like inevitably not making money off meme coins means there's not enough capital to come go and rotate into those.

Hmm.

So it it does sort of feel like

a bit of a malaise, but maybe the rent the washing out is good, right? Like I it generally means like projects that

are not worth it won't make it, or projects that

kind of

overpromised won't survive. So we'll we'll see. I I I I guess like to me the

the biggest thing is like

ETH staking ETFs. I think if that gets approved, that's like a big deal.

And then Solana, for Solana, obviously, I think there's just a ton of positive headwinds in both the ETF side, but also

just like overall usage, stablecoin issuance, et cetera. All of the the institutions starting stuff, like Franklin Templeton announced they're