This Interview Made My Next Crypto Buys Obvious [Haseeb]

Added: 2026-05-05

[00:00:00]Everything about how you interact with crypto is going to change because everything I just described sucks.

[00:00:06]>> Clearly, you know, you're betting a lot of capital on this. So interested to >> drill in into that thesis.

[00:00:11]>> Yeah, quantum is a real risk especially over a 3 to 5 year time horizon. And I think what you have to see from Bitcoin or people to get comfortable with it is so disproportionately what's going to benefit from a 10xing in low-risk people. The answer is >> I'm here with Hib today, the managing partner at Dragonfly. If people don't know who you are, Hase, they probably should by now, but if not, do you want to give a quick introduction on uh on who you are and what you're doing?

[00:00:41]>> Yeah, so I am managing partner at a fund called Dragonfly. We're a multi-billion dollar crypto VC fund. Uh we've been doing this for quite a while, so coming on uh I think just pulling up to nine years that we've been operating in the space. Uh we're one of the biggest funds in the industry. We do everything under the sun. Um seed, series A, series B and beyond. Uh we've invested in a lot of the most important companies and protocols in the space. Talk a lot online. Uh I get into a lot of arguments. Uh but uh I'm one of the longtime longtime believers in the space. Spend a lot of my time both in crypto and obviously like everybody else following everything happening in AI. Um and increasingly believe that there is going to be a lot of intersection between the two over time. So that's what I spend a lot of my days uh contemplating.

[00:01:27]>> I um I really respect that you're you're one of the vocal ones out there, especially in a period like this where the market is I mean kind of dry, especially from a volatility point of view. It's good it's good to have these discussions like I what's your um podcast a couple days ago about quantum.

[00:01:41]I'm going to ask you about that today.

[00:01:43]Uh you know this current state of VC um you're not afraid to argue with the biggest names in the space. So I uh I like the approach. gives us some liveless.

[00:01:53]>> Well, thank you. I try to keep things interesting.

[00:01:56]>> First question, what's your current temperature check on the crypto market?

[00:02:01]So, where do you see things at the moment? Obviously, I guess you know, we could kind of split the discussion from Bitcoin and you know, altcoins and um you know, retail appetite. Um yeah, >> starting with the Bitcoin side of things. I mean, we've had a decent push up since uh everything went down >> with um you know, Iran and the straight.

[00:02:20]Uh markets seem to be pushing up.

[00:02:22]Obviously, we have equities now at all-time highs. What's your read on on the current market?

[00:02:27]>> Yeah, so it seems like the market has found its legs. Um I think what you saw since October was just a total decimation of retail. Retail had clearly exited the market. If you talk to all the exchange founders, they'll tell you that there's just no retail activity.

[00:02:44]It's a it's a tiny tiny fraction of what it was during the the the really uh hot periods of 2025. And retail is flighty.

[00:02:53]We've seen this before. We've seen this many many times. Uh if you look at the core metrics of retail attention, if you look at, you know, search volumes, you look at uh retail focus exchanges and what their volumes are. uh if you look at uh you know installs in the app store there's there's all these things that are very tight measures of retail sentiment or retail engagement and they cratered after 1010 so we know that retail was gone um now that being said who was booing the market the answer is institutions institutions are actually still here if you look at the ETF complex for Bitcoin I think the ETF complex drew down uh about 7% in Bitcoin terms meaning that you know so obviously the ETF F went down in price with everything else but the total amount of withdrawals from the ETF was much much lower which tells you institutions are still here. They are the floor. They are the buyer of last resort at this point.

[00:03:47]Um and they are the volatility dampener of why Bitcoin didn't go down 70 80% as they have done in previous cycles. So the the total ETFs show you that there's a broader confidence that the space is not going away from smart money, but retail is gone. And when retail is gone, retail is a huge part of the market.

[00:04:08]Even for the ETFs, Bitcoin, you know, for the Bitcoin ETF, retail is a huge part of the Bitcoin ETF. Um, but it's not the speculative kind of fast money type people. Those are the people who left. Now, why did they leave? So two things to answer for yourself to understand the market. Why did those people leave and when are they coming back? So first answer why they left.

[00:04:29]They lost a bunch of money. So 1010 overwhelmingly absorbed by retail, right? I mean who is sitting around in leverage positions getting ADL and and you're wiped out on these big moves. The answer is retail is you know who's holding alts which alts just like thermonuclear reaction within alts.

[00:04:46]Who's holding those positions? Retail.

[00:04:48]institutions aren't, you know, going levered long [ __ ] you know, atom or something like that's all retail. So retail absorbed almost all the losses on tent. Um there were also market makers and other institutions, you know, sort of liquid funds that lost money. Those are bad, but the main thing was that retail just got wiped out on 10. Um and then second thing is that crypto is reflexive. And we know this, we've known this forever. Crypto is super momentum driven. And so when momentum goes negative, it stays negative. It just goes and goes and goes until there's some positive impulse that can pull it back up. So, retail's gone. Um, but not only that, where has retail gone to?

[00:05:24]They went to gold. They're going to AI stocks. They're going to memory stocks.

[00:05:28]They're going into oil. Like, they're going to all this stuff that is for, you know, for some reason higher volatility right now than crypto is, >> right? Gold gold is more volatile than Bitcoin was. So that tells you that like yes this is no longer the most exciting show on TV. It's a large part of what makes crypto crypto. It's a large part of why retail is engaged by crypto is that you know okay the stock market okay you know commodities but like crypto now that's crazy that's high vault. Uh if crypto becomes lowvol it really loses a lot of its appeal for a regional investor. So on some level kind of what has to happen and and of course the fact that it's going down as class it goes down is not fun. Nobody wants to nobody wants to trade an assass that goes down.

[00:06:09]So if crypto starts going up again, okay, that's one of the things that you need in order to regain retail attention. We're starting to get that because crypto's bottomed um or at least seemingly has bottomed. You know, who knows what happens from here. Obviously, geopolitics is is a big input into what happens uh in all asset classes. But the second thing is that uh AI right now is insanely volatile, right? You're seeing that with gold, you're seeing that with commodities. They're insanely volatile.

[00:06:33]U we will get to a data taunt with Iran, right? If you look at the poly market, they're pricing that very low likelihood that we're continuing this war by the end of this year. And you know, maybe by you know, it's a full peace agreement uh by the end of the summer is like, you know, more than 50% likely. So quite likely we're going to get to a point where you see commodity prices, you see more stabilization of, you know, uh of macro and the stock market is probably going to remain volatile for some time, especially if we see IPOs coming this year. If Anthropic, OpenAI, if you see either the IPO by the end of this year, there's gonna be crazy volatility in the stock market because these names are going to go absolutely wild when retail can actually get their hands on them.

[00:07:14]Um, and probably same thing with u, you know, XAI, SpaceX, these are super super super volatile uh, narratives that retail is going to love riding up and down.

[00:07:25]>> Outlook for the rest of the year. How do you think how do you think this uh, this plays out in markets? Like I know we just talked spoke about equities for a bit. Um I I guess it kind of seems like uh you think we'll have more volatility in in equities and >> volatility pretty volatile this year.

[00:07:44]Yeah. I mean >> crypto volatility I think superseding equities is going to be hard for the next year.

[00:07:50]>> Um my guess is that things are going to recover gradually as they have been now.

[00:07:56]Um, but I think the main thing is going to be if you look forward to next year post these IPOs. Um, that's when I think it's more likely that you're going to see a broader recovery in crypto. Um, where you can potentially start to challenge alltime highs. Now, all this is speculation to be clear. Yeah, I don't [ __ ] know. But there is a >> I think there's a clear story to tell that crypto needs to regain the mantle on volatility in order for it to be a more attractive asset class for retail.

[00:08:25]If crypto cannot win back the retail bid, institutional bid is not going to push us alltime highs. Just not enough.

[00:08:30]There's not enough capital there. Um I think people I mean people get excited about institutional capital and I do think institutional capital matters but where it's going to manifest itself more is in the crypto equities not as much into Bitcoin ETH soul and especially not into alts. for for the broader complex of crypto to do well, you need retail to come back. And for retail to come back, crypto has to be attractive on a relative basis to equities.

[00:08:57]>> So, what's the narrative, do you think, to bring retail back? Like, what's the narrative for for Bitcoin specifically?

[00:09:02]Do you see a catalyst that could that could trigger this um agnostic of of price action?

[00:09:08]>> Obviously, price action creates narrative, but there has to be some because I feel like what's happened is Bitcoin's lost a little bit of belief.

[00:09:15]Now I'm still a believer. I mean you can definitely build a case for it as digital gold but it has lost a bit of belief obviously seeing what gold has done seeing how equities are outperforming um obviously quantum and there are other factors as well which which have been um in in the press recently but uh how do you feel about Bitcoin? Are you still a a believer? Do you see a clear a clear path for it as as an asset?

[00:09:37]>> I I think people really overestimate the quoteunquote narrative part of Bitcoin.

[00:09:42]I I don't think there's that much narrative for Bitcoin to be honest. I think people believe that Bitcoin is going to exist forever. It's not going to go away. I think people see that it's becoming more and more accepted on Wall Street. The Bitcoin ETFs are pretty young. They're still some of the most traded ETFs anywhere. Um Bitcoin has a lot of demand. Like it's sort of like, okay, what's the narrative? It's like I don't know that there's a nar. It's just like, yeah, it's going to just keep growing for the next 15 to 20 years. And like as the boomers die and hand off the decision-making power over capital to Gen Xers and millennials, they find Bitcoin to be just kind of there. They just accept it. It's just, yeah, it's a part of the world and it's a financial asset that's not going to go away. So, I don't know that there's like a, oh, well, in the next two years, this thing is going to happen. I think it's more just like you know it just keeps gradually eating into becoming a more and more stayed and understood financial asset. Now, quantum is a real risk, especially over a three to five year time horizon. And I think what you have to see from Bitcoin in order for people to get comfortable with it is okay, there's a clear BIP that is, you know, there's there's convergence around it and there's a migration plan. And once you see the migration plan, that's going to build more confidence in Bitcoin. And then once the migration ends, that's when Quantum is going to be fully behind us, right? I'm fairly confident that's going to happen. You can already see that the Bitcoin community is starting to get its [ __ ] together around quantum.

[00:11:08]Um, but the the ultimate answer is that like quantum I think is going to be kind of a Y2K style thing.

[00:11:18]Quantum is going to be a risk. There will be a day when a quantum computer is built that can crack ECDSA. Um, and the day after that the question is are have the chains already migrated? And if the chains have already migrated then it's kind of a nothing story. Then it's like Y2K, right? It's like oh this is a big scary thing that might happen. we prepared for it, we did the thing, we did the mic, we know how to fix it, we know how to fix the bug, uh, and then it's fixed and then it's over and now we never talk about it again. And that's kind of how quantum is going to look. So I think in retrospect, we will look back on quantum kind of like the block size debate for Bitcoin where it was like a thing that happened in the past and we just never talk about it again. And we people the stories will sort of look back and be like I it's hard to really imagine why that was such a big deal at the time that it was a really big deal because now it's like super not a big deal.

[00:12:09]>> Yeah. I also heard um you know you made the point about exchanges could on your last podcast um they could also block addresses like there are all sorts of mechanisms to actually you know stop the supply um affecting the market but then you also made the point that even if it does u you know affect the market at that point it becomes priced in anyway and then that's actually a bull can become a bullish catalyst.

[00:12:31]>> That's right. That's right. So, if you see a migration path, let's say that Bitcoin next year finally gets [ __ ] together and says, "Great, this is the BIP that we're doing. This is the the signing mechanism that we're going to use. Um, so we now have a new key mechanism or key standard. Um, migrate your keys over to this new key format.

[00:12:50]And uh you have three years or four years to do it. And after those four years, all the old addresses are bricked, right? They can no longer move.

[00:12:58]There's no there's no there's no path anymore. Basically, those tokens are black holed effectively in the old addresses. So, people move, every exchange moves, every custodian moves, every ETF moves, you know, within the first six months, let's say, they they they all do that. Um, and so then great, everyone's moved now. Uh, there's some stragglers and then a quantum computer is invented, you know, five years later.

[00:13:20]If you see that is the way that it plays out, then actually that's going to be bullish for Bitcoin, >> right? It's going to be bullish because one quantum computer wasn't invented in time for the full migration and second a lot of supply got deleted and like th those two things are jointly bullish for Bitcoin. So there's a lot of universes where actually the quantum migration ends up being a a catalyst as opposed to uh a a negative thing for for the industry.

[00:13:50]>> So that's the Bitcoin side of the equation. I guess the second thing I wanted to ask you about was the um the the altcoin side like the general um yeah crypto asset side like where are you seeing that that space at the moment because um I mean clearly it trades like in lock step with Bitcoin so we've seen over the past few weeks you know some big big kind of gainers popping here or there but clearly you know there's still not a ton of retail interest. what's your overall assessment on that market and and and then of course I want to drill into like where we think the big opportunities are going to be over the coming months and years.

[00:14:24]>> Yeah. Well, the great thing about markets is that they're relative. So, you know, we drew down a lot uh on the alt side. Now, we can draw up quite a bit just because you don't need everybody in the world to be paying attention to crypto again for it to go up 30 40 50 you know 100% from the lows that we hit in terms of alts. So, I think there's a lot of room for things to recover if we see a broader uh crypto macro recovery.

[00:14:51]That said, you know, I do think it's going to take a while for retail to regain their interest, right? There retail cares a lot more about narratives with respect to alts, right? Alts there aren't as it's not like Bitcoin where like alts are just guaranteed to win over a long period of time. um for Ethereum, for Salana, for uh you know, a for you know all these other things that exist in the investable universe, you really do need to tell them a story about why this matters because unless you're hyperlquid, you're not just printing revenues and buying and burning your token >> uh for almost everything else in the space. And you know, if you look at the revenue generating tokens that are like hyperlquid, very small portion of the overall market, most of this market trades on expectations about the future.

[00:15:32]So if you're talking about expectations about the future, you have to tell a story about what is going to happen in that future and a story that's credible to retail investors. Um I think that is definitely doable. We have all the raw ingredients that we need to pull that off. Um but people have to be excited about where crypto is going. And I think for the you know it's the the core of crypto I think has demonstrated staying power and it has demonstrated that more and more people of more and more powerful people believe in crypto. I mean you just saw um you know the uh the grilling of Kevin Worsh going in front of Congress and he was basically up there saying like yeah I believe crypto is fundamentally entrenched now as part of the financial universe not going away. very valuable to US interests. Uh you can't imagine Janet Yellen saying that. You can't imagine Powell saying that. It's it's just like a totally different universe that we're in now where the Fed chair is saying this and the Fed chair is going to be here for a long time. Um so I think there is genuinely been a sea change um in the financial institutions that are embracing crypto. Meta saying that or not saying but it being uh reported that Meta going to launch their own crypto wallet in sometime in the second half of the year. All of this points in one direction which is that crypto is here to stay. Uh but you need some specific narratives in order for retail to really want to come back.

[00:17:04]>> In this tweet here and this is one of um one of I guess your big like thesis for for the year is that um financial crypto is exploding. And you've also talked about like the death of non financial crypto assets. Interested for your thesis around this and and why you think this is such a big opportunity. I've also pulled up your um Dragonfly Fund raise as well. So clearly, you know, you're betting a lot of capital on this.

[00:17:30]So interested to >> drill in into that thesis.

[00:17:34]>> So I've I've believed this for quite a while that crypto is fundamentally about money and finance. And if you look at everything that's worked in crypto at scale, it's always been centered around money and finance. So whether it's Bitcoin being digital gold, whether it's Ethereum allowing you to write financial contracts on money. Uh the same thing is true for uh you look at the growth of DeFi, you look at ICOs which are capital formation, the fundraising, you look at RWAs, you look at stable coins, prediction markets, everything in the space that has worked has been about money and finance.

[00:18:11]Now there have been stories that were told mostly by VCs to be clear and a lot of founders as well but you know boosters of the industry that oh no it's also going to be used for uh supply chain tracking and it's going to be used for you know um the auditing and it's going to be used for uh the metaverse and it's going to be used for games.

[00:18:31]It's going to be used for social media.

[00:18:32]It's going to be used for all these other stuff. And this was not consumers showing us that they wanted to do this.

[00:18:39]It was a story that we told and we kind of got higher on our supply as an industry that oh yeah yeah totally totally this is going to happen because doesn't it make so much sense and this you know in 2020 2021 I was getting into so many arguments behind closed doors with other VCs about this because that was the that was the meta narrative behind 2020 2021 was that this is going to eat everything. It's going to eat social media. It's going to eat gaming.

[00:19:07]it's going to eat all these other uh sectors.

[00:19:09]>> Gaming was huge. Metaverse was huge. I mean, even Zuckerberg fell into that trap.

[00:19:13]>> Absolutely. Absolutely. And I didn't believe it. Now, that being said, I'm a pretty skeptical kind of uh you know, Uncle Scrooge kind of guy. So, I was I was talking to a lot of these other VCs who were pouring money into things like Eagle Labs and Axi Infinity and all this stuff. And we pass on all that [ __ ] We did not we we just I I I just could not buy it that this stuff was real. We pass on OpenC. be passed on, you know, all these huge gaming deals, uh, because I'm just like, I don't I look, I' I've played with them. These are these are not good games. I I've used some of these centralized social media. It's not good. I'm still on X. You're still on X.

[00:19:50]Like, what are we doing here? So, um, I didn't buy these stories. And I think in retrospect I've been vindicated on that point that the real product market fit for crypto the place where it is really used and where people want it is our money in finance. And so that is where we've been investing for so many years um is in this stuff in DeFi in stable coins in exchanges in you know the stuff that lives close to that beating heart of crypto. Um, and uh, and now people are kind of, you know, some people are despondent that they're like, oh, you know, why didn't this happen? How, what will it take for it to happen? I'm kind of like, look, I don't think it's going to happen. I think you need to listen to the market. You listen to what the market's telling you. Market's telling you is that this is what we want. This is what we care about. This is the value that you have created as an industry.

[00:20:40]Um, lean into it, own it, you understand it. Uh, that has been my philosophy as an investor. And I think that has carried us now to you know have the mandate to keep doing this at a time when most of the VCs have been wiped out. The people who are sort of collectively deluded about crypto um they didn't get the right to keep investing.

[00:21:01]>> Um I I want to drill into financial crypto specifically in terms of where um you're allocating like what are the you know just before we started recording you were talking about how you were researching something. Um, what are the the the projects and the builders that you know come across your desk that get you the most excited? Like what are you looking at right now? Like is it prediction markets? Is it you know AI agents? Like what is it where you're like wow like I'm I'm compelled to invest here. Where do you think the opportunities are in the market? Now >> I mean there's a lot of stuff that we're looking at in both those sectors. So big investors in poly market. Obviously there's a huge amount of stuff going on in the prediction market space. We spend a lot of time there. Uh I think there's still a lot of surface area that the two big ones polyark and call she have not covered. Then you look at market >> was trying to get into the per market.

[00:21:52]They announced >> yes they just announced per they announced. It's not live yet but they've announced uh I think a weight list for their purp product.

[00:21:58]>> Um so they're they're clearly going into just becoming a massive consumer brand and touching everything that they have exposure to. uh and also allowing you the other thing about per for a prediction market is it allows you to express bets on scalers much more effectively. So most of the prediction markets today are binaries. So is it above or below this price? Will this thing happen or will it not happen? And if you want to express a scaler like you know zero to 100 usually there's like four markets, right? So it's like oh is it above this number? Is it above this other number? Is it above this other number? Is it above this other number?

[00:22:31]And that you know you can kind of infer what the expected price is but it's it's really a shitty mechanism to express a scaler because these you know repeated binary options at different prices they fragment uh liquidity really badly. It's very capital inefficient to express it that way and it's not intuitive for retail right if you're like I think openi is going to come out at 1.2 2 trillion when they IPO it's like okay well you you know there's seven or eight markets and each of them is only above or below this one number right and that's not really the way that retail wants to express this bet like really you want to just buy an asset that goes up and down u yeah and so I think that's a big part of the reason why they're launching per not just because okay we can do crypto and do all the stuff that Hyperlink is doing um but it's it's more so I would bet that a lot of the markets that they want to be operating in it's just a better mechanism for it compared to you know just listing a bunch of binary options.

[00:23:25]>> Yeah. So that that's I think what's happening on the prediction market side but there's still a lot of surface area that polymer market and call share not covering. Um then you've got on the AI side there's a big intersection between crypto and AI that I'm spending a lot of my time on. Uh there's a bunch of stuff happening within agentic payments. Uh you can see the XRO2 and MPP volumes are growing quite a bit. Uh, I was I'm we're looking at a lot of these um projects that are basically these API gateways that are allowing you to buy things via API with your agent. So you can get, you know, plug it into your cloud code and just say, hey, you know, use something like ATXP or sponge to, you know, pay for compute, pay for browser sessions, solve captures, um, you know, spin up an email for yourself, like all, you know, run web searches, uh, call other LM APIs, all without setting up an account, right? You don't have to set up an email or do anything.

[00:24:22]All you need to do is pay it with X42, uh, and just have some stable coins and pay on demand for API calls. So all of this kind of stuff is really interesting. These these businesses are growing pretty quickly. Uh so that's that's an area I'm spending a lot of my time on right now.

[00:24:36]>> On this tweet you said um crypto well you didn't say it explicitly but you talked about with the bankless guys why crypto was not made for humans uh and and and why it was you know potentially uh made for agents or will be heavily utilized by agents. What what's your view on how this evolves over the over the coming months and years?

[00:24:57]Yeah. So it's pretty clear that the affordances to almost all software is going to change.

[00:25:04]And if you are somebody who you're using open law or you're using these like really fancy um agentic frameworks, you're already living in the future. The vast majority of people are not doing what you're doing today. But in a few years they will be. Everybody's going to be doing what you were doing today. So what that means you know you can already see with something like you know claw design uh is that PowerPoint is just the wrong affordance now it is not the right interface with which you're going to be interacting with designing decks right the same thing is true with Photoshop same thing is true like everything is the wrong affordance now because agents are going to be the first pass through which you're going to be interacting with this particular uh kind of work product the Same thing is going to be true of crypto.

[00:25:54]You going on an interface, clicking a button and being like, "Oh, I want to do this thing over here and clicking bridging into here. Go check my balance.

[00:26:02]Oh, hit the RPC. Go look at the block explorer. Okay, yeah, what's going on with this thing?" Go check the Twitter.

[00:26:07]See, is it been hacked? Is there any notice of something weird going on with this thing? Go look up the LinkedIn of the founder and make sure that there's a real person. Um, okay. Then now I have to go read the thing and I look at my little Oh, okay. Does this thing match that thing? Is this exactly what I said I was signing? You know, I go do the transaction simulation to go see, okay, is this exact number of tokens I expected to move when I sign. This is what it's like right now. This is like the same thing of us using Photoshop as opposed to putting it into Nano Banana and saying, "Hey, put my face on this guy's thing and post the meme, right?

[00:26:40]Everything about how you interact with crypto is going to change because everything I just described sucks. It is a shitty UX. It is not the way that humans want to be interacting with financial assets, right? Everything is going to be intermediated by agents. And for agents, all of the sharp edges of crypto, you think about it, you know, the way in which crypto is very unintuitive for people, right? It's like, okay, private keys, really weird.

[00:27:08]Why am I Why am I memorizing these 12 words? That's not the way that I deal with anything else in my financial life.

[00:27:13]Uh, and if I and if anybody ever hears these 12 words, all my money is gone forever instantaneously. Um, and then we have, you know, 15 decimal points of money. Why are there 15 decimal? You know, this this is insane. Why why am I dealing with this level of granularity?

[00:27:26]And, um, the ways in which, you know, smart contracts are weird. I have to see hashes and like everything everything is weird. Nothing is designed to be human usable or readable, right? But for machines, it's kind of perfect. Machines already understand API keys. The moment an API key is leaked, all your, you know, everything's gone. So machines understand you never, you never let the API key leak in plain text. 15 decimals are great if you're an AI, you don't care. What's another, you know, what's another few decimals? That's fine. Like everything about crypto, all the foot guns, all the weirdness goes away. The idea that like, oh, what? Why would I ever be able to sign one transaction?

[00:28:03]All my money goes away. For an AI, it's like, well, yeah, of course that's going to happen. So I'm going to always read the smart contract, read all of the code, right? As a human, we always said this, oh, you know, smart contracts are great because you can read the code and understand exactly what it's doing.

[00:28:16]Yeah, but you're not going to do that.

[00:28:18]Can you read solidity? Do you understand what what it's doing when you sign? No, nobody's nobody's reading the solidity to understand what this contract is doing unless they're like a crazy autistic programmer, right? But AIS are literally crazy autistic programmers.

[00:28:33]That is what they do. They can read through the contract in half a second.

[00:28:36]You know, it costs a fraction of a cent for it to read and parse a smart contract and understand exactly what it's doing before it ever signs. Think about the hack that just took place with RS, right? If you are on a today, you would have to have some notification on your phone. Check your phone. Your phone says, "Oh, something some crazy [ __ ] went down on a you should probably pull your liquidity." Um, and then you have to go manually go to your computer, do all the stuff, sign the transa, understand what's going on, read all the stuff.

[00:29:07]But instead, your AI agent will instantly be monitoring your positions in the background, see that, oh, this thing just happened. I need to pull out.

[00:29:14]The safest thing to do is just get it back into my EOA. It immediately does a transaction, signs it, moves everything out, and then waits for further instructions, say, hey, I pulled everything out until we see what's going on with this hat, right? Like, imagine all this happening. And it's not just that. It's not even it sees this happening in real time. It's monitoring the men poolool, right? It's looking at what's h, you know, it's looking at the bridging transactions. It's looking at like, hey, actually, it looks like a is about to have a gigantic mint for an underlying asset on the bridge. It hasn't even gotten into a yet. It's on uni chain right now, but you're on a you're on mainet. There's still time before it bridges from Uni Chain into mainet. And until that happens, let's just get everything out of here. We don't we don't even want to bother about it, right? The only thing between this universe and today is compute.

[00:30:03]The only the only thing that's stopping that from happening is compute. With enough compute, this can all happen instantaneously.

[00:30:11]And you know, it's not going to be long before a mythos level model that can do cyber security better than any human being any any human being who's ever lived is going to be available for everybody to be able to use. It's just going to cost money. It's going to cost, you know, tokens per tokens per hour. So that a an intelligence that good, that fast, that instantaneous is going to be available for every single person to manage their financial lives. When that happens, your relationship with crypto is going to completely change. And the perception that we have that crypto is kind of dangerous, the perception that we have that like, well, I kind of trust my bank more than I trust crypto. That perception is going to change. You're actually going to trust like why do you trust your bank more than you trust crypto? And the answer is like, well, I kind of, you know, as much as I believe that like Bitcoin is not going to get hacked, Ethereum itself is not going to get hacked, but like my smart contracts or like the private key, I might leak the private key. There's so many things that I can do wrong, right? I'm stupid.

[00:31:08]I'm a monkey, you know? It's like I I'm not worried about the the airplane, but I am worried about driving my car because I'm a monkey and I'm driving around this like two-tonon, you know, gigantic death machine and like, yeah, I might mess up. I might get tired. I might somebody else might mess up, right? But like planes we know are way safer than cars. Why? Because they're automated, right? There's a bunch of there's a bunch of automated machinery and professionals driving the [ __ ] thing.

[00:31:34]>> So with crypto, we are going to get to a point before too long that basically the same way that all the systems that keep you secure when your money is in the bank because like there's just somebody who's going to make sure that you don't send your money to North Korea, right?

[00:31:49]Like if you are if you are in your bank, it is really hard to wire money to North Korea. You just even if if you try even you wanted to, it's hard, right? If you literally want to say I want to give money to Kim Jong-un using your US bank account, you can't do it. It's hard for you to do it, right? In crypto, literally you can you can do it right now. Nobody will stop you if you send all your money to North Korea. um that will change the same way in which all that intell like what is the difference between your bank and crypto? The answer is just intelligence.

[00:32:25]It's just that your bank has systems and humans in place making sure you don't do it >> and your will do the same thing. If that does change, then I mean the logical next step in my head is like, okay, now this opens crypto up as a viable option to billions of people. I mean, and obviously millions or billions of agents as well. So, do you genuinely see this as like an an inflection point for crypto adoption more broadly because it's easier? I mean, agents obviously can't KYC with a bank or open up a bank account, but they can they can trade to each other in crypto. you can trade agent to agent a fund or a counterparty, you know, or a store, I mean, whatever it may be, can trade um stable cocoin to stable coin. So, do you see that as being a big like the big shift for the industry potentially?

[00:33:14]Absolutely. Now, I don't think that happens soon. It the reason why it doesn't happen soon is because the agents are not good enough yet. Agents are not as smart as your bank right now.

[00:33:23]They're stupid. They can be prompt injected. They can be jailbroken >> and people don't trust them. I mean those memes on GPT is still flying around, you know, of GPT spelling strawberry wrong. So as long as that exists, people aren't going to trust.

[00:33:36]>> They hallucinate, they make mistakes, right? So like, but all of this stuff is going to get solved the same way it got solved for coding.

[00:33:42]>> People don't sit around worrying that claude code is going to just, you know, delete all their files and like destroy their machine. Once upon a time they did. And once upon a time flood code could do that, right? If you like I remember using cursor back in like 2022 and it was a piece of crap. It genuinely sucked. It just constantly ran in circles and you had to you had to really be a good programmer in order to use these things. You know, it's like it's like riding a wild horse. Now, this thing is a car. It goes in a straight line. It goes where you want it to go.

[00:34:12]Uh it's a car that breaks down sometimes, but it is a car. Um we are going to get to the point pretty soon where these things are airplanes. these things just fly and they don't make mistakes and they never crash. And that is the point that we need to get to for crypto for this thing that I'm describing to happen. But once it does happen, it's only a matter of time until it happens. Once that does happen, the models are smart enough, mature enough, and they've been trained and and you know, RL trained in an onchain environment, I think that's when you're going to see this perception shift.

[00:34:45]Today, people perceive crypto is risky.

[00:34:47]It's dangerous. it's hard to use. They don't have the same confidence in crypto that they do in the traditional financial system. That that is going to change. It is going to be just as safe, just as robust, just as reliable as a traditional financial system because of AI.

[00:35:02]So, in that world, what do you see as the biggest beneficiaries? I mean, beyond the models that people are interacting with like specifically on the crypto side, um is is it Bitcoin? Is it the networks the the the layer ones that are facilitating these transfers?

[00:35:18]Is it the um I don't know is are there a new set of protocols that that come up?

[00:35:23]Is it DeFi because now it's easier to deploy and earn yield and where do you think the value occurs in this future? I don't have a very sophisticated answer to this to be honest, but my my view is that if you imagine that what I'm saying is true, that huge number of people are going to come on chain because their agents are going to make crypto much more secure and reliable for them. This is kind of like saying that there's just way more people are going to come on chain. If I told you that China was going to unban crypto, what would you buy? a bunch of new people are gonna come on chain, what would you buy? Like maybe you buy NEO or you know whatever Ethereum for China or some random [ __ ] like that. Um but the main thing you buy is literally [ __ ] anything because like they're going to use the same stuff that we use, right?

[00:36:14]They're going to use like why would they use something different? So >> it's probably the good stuff, the trusted stuff. I mean you know Bitcoin comes to mind.

[00:36:22]>> Uh I mean Hyperlid for example is you know I'm not saying buy Hyperlid. is saying as a product it's highly very highly respected. So it's that's another >> I I I would actually say I think Hyperlquid is on the wrong end of what you should expect to do well.

[00:36:35]>> Okay. Because what is Hyperlquid?

[00:36:36]Hyperlid is a leverage trading app for you know basically uh uh Djens right I mean leverage trading is a DGEN product.

[00:36:45]>> So if you see a huge explosion in people coming on chain it will not be because they're here to gamble. If you're here to gamble you're already gambling today.

[00:36:54]Why why aren't you gambling now? You know, if you just want >> maybe it makes it easier to gamble. I mean, maybe it's easier to >> Yeah, but that's not why people are not gambling >> with an age go to next long then slide.

[00:37:05]>> No, no, no. I I think it's I think that's also not a correct mental model of what people are doing when they're leverage trading.

[00:37:11]>> Nobody is going and giving their money to a fund to go leverage trade for them.

[00:37:17]Right? If I give my agent my money and I say, "Hey, go leverage trade for me."

[00:37:22]It's almost like, you know, giving my friend some money and saying, "Hey, go to the casino and play slots for me."

[00:37:27]Right? Nobody does that. That's [ __ ] stupid. That doesn't make any sense.

[00:37:31]That's not why you're playing slots.

[00:37:32]Like, you're playing slots because like it's just the wrong it's the wrong psychology, right? Like, it is it's fun.

[00:37:38]It's adrenaline inducing and because it gives you some sense of agency. If you just give your money to somebody else, you say, "You go play slots for me, and if I do well, I I really hope that works." You'd be like, "Both, that's not fun." And that just sounds kind of stupid and like I I think people have some broad understanding that most people are not good at this thing and will not win on average, right? So, uh they might think that maybe they individually are more skilled than the average person, but they don't think that they're the people around them are. You know, it's it's a little bit like poker, right? If you're sitting down at a poker game, it's because you believe you're better than the people there, but you obviously don't believe the person next to you. You wouldn't be like, "Hey, here's my chips. You play for me."

[00:38:23]>> What if you believe that better than you? Why are you sitting down?

[00:38:26]>> What if you think that your agent agent's better than the other agents?

[00:38:30]>> Yeah. And then it becomes agent agent warfare, >> which it will become in financial markets. There's going to be a I saw this clip the other day. I think it was lit a thread guy, you know, speaking about how if you know what what should you buy in in equities and it's you buy whatever Chhat GBT is recommending you to buy because everyone's going to be asking Chad GBT. It's I can kind of see that future where everyone's getting the same financial advice from the same places. So the edge is almost contrarian, but then it's reverse reverse psychology of okay, now I have to >> Yeah.

[00:39:00]>> Yeah.

[00:39:01]>> It's a little bit like buying whatever Wall Street tells you to buy. I mean, it's sort of like, okay, then you're going to buy a lot of GameStop type stuff, >> you know?

[00:39:08]>> Yeah.

[00:39:09]>> Like look, if you're swing trading, yes, if you're buying momentum and then you're selling when momentum turns, then yes. But for long-term holding, obviously that's not what I would recommend if you're talking about medium or longer term uh trading.

[00:39:22]>> I guess back on on the hyperlquid point, I mean, it's not really the broader point I'm making here. I'm just kind of, you know, spitballing. You're you're also a good debater. Um what if uh can't you see a world where if if all this capital and Hyperlid is really just an example here? It could be any any protocol, but if if there's a world where there's a lot of capital now coming into the space that wasn't previously there. I mean that's that's technically exposing a new audience that never would have been in crypto and now suddenly find themselves with, you know, wallets with 10 20 thou $30,000 that they didn't previously have. like now there's less friction for them to go gamble or there's less friction for them to go and application like poly market that you know just that friction of oh I've got to put $10,000 into poly market is I mean even for me you know I'm I'm seasoned in crypto but sometimes oh I don't want to start a new wallet and it so I just won't bet even though in my head I'm like I want to bet on Real Madrid tonight if I could snap my fingers that might just the downstream effects just might benefit anything in the ecosystem that that works or is you know a good product. So two things to understand here. So one, if you go to hyperlquid today or you go to poly market today and you go try to deposit, there are already fiat on-ramps on both hyperlquid and on poly market that will allow you to not even know that crypto is anywhere involved in this whole chain, right? For for hyperl obviously it's pretty obvious that there's crypto involved because it's denominated against us like you know it's [ __ ] exchange. uh for for poly market a lot of people don't even know that this thing is on polygon and you have your positions are being netted against tokens on chain um and for you know for all intents and purposes you don't really care if hyperlquid were a centralized exchange for a lot of people the UX wouldn't seem any different right you just you go on there you privy wallets in the browser uh you deposit with fiat and you just go start trading um so it's not really obvious to me that the impediment to somebody today for trading on hyper liquid or polyark is that I don't trust crypto or I don't want to use a crypto wallet. um for most people today if you go I mean you might not want to do it because you think it's risky for other reasons but um the risk appetite story I think is not a is like there's some of it for sure if you have some money on chain yeah it's easier to move your money into there and it's just it's just like Robin Hood right it's like okay you already have money on there so you'll go ahead and bet on sports on there I I think I agree with you that's a real mechanism but it's much more likely that if you imagine the universe of all uh the addressable market for crypto right there are people who are higher risk takers and lower risk takers Okay, the higher risk takers are disproportionately already on chain, right? Let's say let's say that 60% of them, they're high, they're DJs, right?

[00:41:56]They're already finding a way to get on chain. Even if they're not allowed to be on chain, they're finding a way to get on chain. They're they're using the VPNs, they're doing all this other stuff. They're they're Chinese and they're still finding a way to go trade on Hyperlink, right? Uh so most of these guys or just for the sake of argument, most of these guys are already on chain.

[00:42:11]Some more of them will come on chain if it becomes easier and safer and so on.

[00:42:15]But you already have a large part of this market because by definition they have higher risk appetite. They're willing to eat glass to get on chain and do what they have to do. Now the lowrisk appetite people, these are the people who 5% of them are on chain, right?

[00:42:30]These people are going to explode in the world where crypto becomes safer, where hacks become, you know, extremely rare, where uh everything is intermediated, where you no longer have all these footguns, right? where AI is intermeding all this stuff for you and makes everything super easy. These people are going to come on chain on mass. So disproportionately what's going to benefit from a 10xing in low-risk people. The answer is the majors and like the stuff that those people are going to do which is buy stable coins, buy uh you know go on a >> real world assets are very interesting in this scenario because people are always you know already familiar with the S&P. I would imagine it'd be a lot easier to buy an index fund with an AI agent with $10,000 in USDT than it currently is to open up a brokerage account and wait two days. And I mean, I know there already things like Robin Hood to make that easier now with Apple Pay, but this I'm talking Sorry, there's an alarm go off. I'm I'm talking the serious players, you know, it's easier probably be easier them. So I wonder if there's a big opportunity in um tokenized equities uh tokenization platforms all that all that ecosystem I think could be quite interesting.

[00:43:40]>> I think that's exactly right. I think today most people who are on chain are speculating or investing but there's very few people saving.

[00:43:51]Saving behavior on chain is very rare.

[00:43:54]Right? What do savers look like? They look very different. It's low risk, low yield. Um, you know, sitting in one asset for a very, very long time. You know, just people just holding indexes, right? Today, of course, we have, you know, the reason why the S&P is such a big index, the reason why it's so excited to trade it is because it's like the the actual underlying index of people just holding the S&P 500 is enormous. People just slowly allocating capital to it over the course of their lives. It's passive investing. That's why we call it passive investing. So passive investing on chain it kind of doesn't really exist except for you know just you know onchain treasuries. Um I think that is one of the things that I I agree with you that is going to absolutely explode.

[00:44:36]>> Nice. All right we'll leave it at that.

[00:44:38]Uh thank you very much for joining.

[00:44:40]There are some interesting topics here.

[00:44:42]We'll have to have to do it again sometime.

[00:44:44]>> Yeah. Always fun to chat. Take it easy.

[00:44:46]>> All right. X time.