Santiago Roel Santos
Key Views & Dialogues
Everyone Is Watching AI While Crypto’s Bull Market Builds | Weekly Roundup
AI’s narrative dominance masks a possible crypto bull market, as Yano reports revived interest after 18 barren months and tokens that have increased 50 times. Anthropic’s reported $1 of revenue per $60 of compute, possible ARR stabilization, and customer switching leave frontier-model economics unresolved, while 1 gigawatt of AI capacity costs $50–60 billion. Falling inference costs could strand capacity or trigger Jevons’ paradox, as LPs seek crypto’s growth-stage fintech opportunity as a countercyclical alternative to crowded AI.
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The central paradox is that AI owns the narrative while crypto may already be in a bull market. LPs remain preoccupied with AI, even as Yano says crypto interest has revived after 18 barren months and some tokens have moved dramatically: “No one believes this is a bull market, yet tokens have increased 50 times.” His renewed watchlists show returning appetite, but also the risk that sidelined investors chase after the move.
Anthropic became the proxy for a broader question: can frontier-model revenue ever outrun compute expense and relentless customer switching? The hosts cite reported economics of $1 in revenue per $60 of compute, a recent absence from OpenRouter’s top 10, and possibly flattening ARR—but repeatedly admit they have not seen the full S-1. The disagreement is unresolved: Santiago presents the demand and usage evidence, while Jason attributes the plateau to compute constraints, citing Anthropic’s usage limits, but says capacity may constrain other businesses more than Anthropic itself.
AI infrastructure is attractive only if compute stays scarce long enough to repay an extraordinary fixed-cost buildout. The episode estimates that 1 gigawatt of current-generation AI capacity costs $50–60 billion, roughly half in Nvidia chips, and could generate $10–20 billion annually at $2.50–$3.50 hourly rental rates and 80–90% utilization. A private-credit executive’s harsher verdict was that the projects require “a venture-capital view of private credit” and that lenders underestimate downside protection.
Falling inference costs could strand capacity—or unlock enough usage to validate Jevons’ paradox. Santiago was unsure whether the model discussed was Jev or Type Safe; for Jev, he said it was 238 times cheaper than Fable, 70 times cheaper than Opus, and 38 times cheaper than Sonnet. That threatens forecasts built on today’s expensive workloads. Yet AI penetration remains below 5%, while one Blackstone portfolio reportedly expects token spending to rise from $25 million to $500 million in a year: “You’re starting from a very low level of penetration.”
Crypto’s investable expression has shifted from “long stablecoins” to “how do I go long a token?” The prior answer included Coinbase and Circle; today the hosts point to Backpack and Securitize, with Robinhood potentially offering a cleaner public-market expression. Legal structure and tax treatment matter alongside technology. Yano admits Backpack grew 50x while he watched—“What an idiot I am”—and says he still plans to buy Backpack and Pump, while Santi discloses buying more Zcash.
The hypothetical $200 billion FTX portfolio is an underwriting warning, not evidence of venture skill. Anthropic, SpaceX, Cursor, Solana, and Robinhood might have created one of the top five venture-capital funds of all time, but Santiago rejects the comparison: “If I had an unlimited money faucet” and invested in everyone, a few winners would prove little. The sharper bubble signal was that “the person who did the most due diligence was Taylor Swift and her team.”
LPs are beginning to treat crypto as the countercyclical alternative to crowded AI, particularly in growth-stage fintech. The hosts estimate roughly 60 crypto-related growth companies, many using stablecoins or tokenized assets, versus perhaps 15 suitable targets for Coatue’s new $8 billion fund. Capital looks especially scarce between $500 million and $5 billion valuations, while accessible early-stage AI funds increasingly receive the answer: “It’s too late.”
Financial agents may compress some friction rents without overturning wealth management as quickly as expected. Jason’s framing is that personal agents could move consumers toward cheaper or better financial products, while “by definition LLMs give you mediocre advice”; median advice could still improve outcomes for millions without basic financial literacy. Agents may accelerate active trading and movement toward cheaper products, but younger users appear to trade faster while older, wealthier Americans remain more buy-and-hold, and incumbents still control the available product menu.
Memecoins Are Stress-Testing The Future Of Tokenized Stocks | Weekly Roundup
Memecoin–stock-token pools are forcing tokenized equities to confront real liquidity and infrastructure constraints. In the BONER/HIMS pool, roughly 60,000 HIMS tokens and limited weekend minting drove the wrapper to an implied $132, or three-to-four-times Friday’s close, without squeezing HIMS itself. The experiment could accelerate 24/7 markets, but custody, backing, redemption, and token-holder rights remain unresolved.
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Jason Yanowitz compares the current market to the disbelief that followed a prior cycle’s 10% candle, while Santiago Roel Santos calls it the beginning of a bull market. Yanowitz recalls an ETF-related Cointelegraph intern post after which Bitcoin’s 10% move seemed impossible and memecoins began running while investors explained why the move could not last. Santos says his earlier “$65,000 generational bottom” call now looks increasingly credible, while acknowledging he gets few such calls right.
Santos sees memecoin–stock-token pools as the forcing function that could accelerate tokenized equities and 24/7 markets. Memecoins have “stressed the infrastructure more than any other piece of technology in crypto”; pairing their demand with scarce stock tokens forces liquidity providers, authorized participants, market makers, and market infrastructure to solve real problems. “The sheer volume is like opening a massive fire hose to sort this thing out.”
The Boner/HIMS pool demonstrated how a tiny, temporarily fixed on-chain float can detach sharply from the underlying stock. With roughly 60,000 HIMS tokens outstanding and more than half locked in the meme pool, weekend BONER demand pushed tokenized HIMS to an implied three-to-four-times Friday’s closing price, reportedly around $132. This was not a short squeeze in HIMS itself but a squeeze in the small authorized-participant wrapper pool while new tokens could not be minted.
Buying a memecoin paired with a stock token does not give the buyer a claim on the corresponding shares. Yanowitz described Robinhood’s tokenized HIMS as a Jersey debt security, theoretically backed one-for-one by shares at a custodian but carrying no votes or ordinary shareholder rights. Matt Levine’s warning, relayed on the show, is that users may not care about the wrapper when things are going well, but custody, redemption, backing, and rights will matter when something breaks.
On-chain equities have become the leading institutional and regulatory question around crypto. Yanowitz says New York institutions and Washington contacts independently called them “the single most important thing we’re trying to figure out,” while one fund discovered Hyperliquid through its pre-IPO markets. The opportunity therefore comes with an urgent need for transparency across custody, backing, legal claims, and token-holder rights.
Yanowitz’s preferred cycle expression is Robinhood, potentially supplemented by the L2 infrastructure beneath it, rather than ETH itself. He recommends Robinhood and L2 exposure, owns both, and says ETH’s roughly $300 billion valuation does not fit its current fees. Santos says he is also very long Robinhood and Coinbase, and calls Solana “literally years ahead” of most chains under sustained load. Yanowitz disclosed BTC, SOL, HYPE, ZEC, and MORPHO holdings.
Stablecoin distribution is becoming both a competitive moat and a market-cycle signal. Yanowitz argues USDC is the only asset that materially moves the needle for several new DeFi builders, interpreting Stripe’s single Open Issuance standard after acquiring Bridge as evidence that “the many stablecoin view has failed.” Santos agrees issuance may proliferate without meaningful volume fragmentation and reads BNB Chain’s approach toward overtaking Tron in stablecoin holders as evidence of growing retail participation.
Crypto’s Speculation Problem, Regulation Without CLARITY & The Gambling Economy
Blockworks logged more sales calls than in any recent period, while inbound leads rose as fintechs and brokerages rolled out crypto. CLARITY remains uncertain; SEC and CFTC rulemaking could catalyze innovation, but unclear token value accrual and falling CEX volume leave institutional adoption unresolved.
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- Yanowitz argues the market has bottomed, and his evidence isn’t price — it’s pipeline: Blockworks logged more sales calls this week than any week in six months, with inbound leads rising six straight weeks, led by fintechs and brokerages rolling out crypto. His read is that commercial demand from traditional finance (“even Vanguard is pushing in”) is a leading indicator of sentiment, even as spot markets churn sideways and Saylor’s selling is met with only a ~2% weekly drawdown.
- With CLARITY at roughly a 20% chance on Polymarket, Yanowitz’s catalyst thesis is that the SEC and CFTC stop waiting on Congress and push through rules they’ve been sitting on — innovation exemptions, fundraising exemptions, and safe harbors. Rob agrees the agencies will move, but flags the cost: without legislation, token value-accrual design stays “murky” and the largest banks and asset managers — who need long-term planning certainty — invest less. “It is certainly net worse than if we don’t get the CLARITY Act.”
- The sharpest disagreement: Santiago declares “tokens are kind of dead at this point,” citing retail scar tissue from low-float/high-FDV launches and telegraphed vesting unlocks; Rob fires back that “tokens are definitely not dead — that’s a crazy thing to say.” Both concede adoption (stablecoins, Coinbase launching its chain) can boom while your token drops 60–90% — correlation breaking is maturation, but it means enterprise wins don’t pump your alt.
- On Fomo versus Pump.fun, the numbers are hot — Fomo hit a $1.88M weekly net-revenue all-time high with 50K daily active traders, and routed $139M into Pump.fun’s pre-graduation bonding curve August 1–7 — but Rob warns the headline data flatters a shrinking market. DeFi’s rising volume share reflects CEX volume falling sharply, not necessarily on-chain growth (“the numerator is getting bigger, the denominator is getting smaller”), and if this is another meme cycle, history says it crashes in two to three months and “spells worse things for the rest of crypto.”
- Santiago’s most tradeable confession: he’s allocating “less and less crypto, to be honest” in his own venture book, frustrated that most on-chain activity remains “24/7, 365-day speculation” while SpaceX- and Cerebras-style deals feel like curing cancer. Rob’s counter is that financialization “has just seeped into every piece of our lives” — Betterment data shows 26% of Gen Z call sports betting part of their financial strategy and 52% diverted would-be investments into it — so the job is building transparent products, not moralizing.
- Rob’s breakdown of Erebor’s $1.5B raise at an $8B valuation: “the fastest-growing bank ever, essentially,” with over $4B in deposits, using crypto and stablecoin-related capital to lend into capital-starved defense. Banks trade on a tight price-to-book versus ROE relationship; its ROE is deliberately low to signal conservatism to regulators, the raise covers capital ratios, and crucially “they’re growing deposits much more quickly than they’re growing loans, which is a good thing.”
- Collector Crypt crossing $1B in gross revenue — with Pokémon cards as “the single best-performing asset of the last couple of months” — gets dissected as gambling in collector’s clothing: disclosed negative-EV packs, instant buybacks at a 15% discount, and about 99.5% of users selling straight back. Rob’s verdict: “essentially a slot machine where you always make some amount of money, it’s just EV-negative” — and liking this while disdaining memecoin trading “feels very disingenuous.”
- Odds and ends with teeth: Jason reported Paolo’s claim that Tether underwent its first full KPMG audit with an unqualified clean opinion — “the largest inaugural audit in the history of finance,” though Jason said he wasn’t sure how that was measured — and Santiago is holding memory stocks (Micron, SK Hynix, SanDisk; memory was up 15% on the day). If Micron fell 40%: “I’d load up the truck” — his thesis rests on 3–5-year locked-in business contracts and the Benchmark-podcast mantra that “you’re just not bullish enough on AI.”
Crypto’s Value Capture Problem & Why Robinhood Built Its Own Blockchain
After eight months across 20-plus sectors, Santos says Inversion’s crypto-embedding thesis failed to clear the return hurdle, shifting focus to quality, cash-flowing businesses. On-chain B2B borrowing costs 8–12%, while crypto FX quotes sit 20–50 basis points above mid-market; Robinhood Chain’s more than $500 million in Uniswap volume and roughly 150,000 new active wallets show verticalization, though P&L value remains disputed.
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- Santiago Santos says eight months of “turning over stones” across 20-plus sectors have not validated Inversion’s founding hypothesis: that buying a business and embedding crypto can produce an above-market return. His core mistake was filtering for businesses where crypto might release value, which selected for “melting ice cubes”—including cash-poor MVNOs and challenged remittance firms. The new mandate is to buy quality, cash-flowing businesses where AI, crypto, or other best practices can make them better, while remaining open to being “corrected now rather than later.”
- The sector autopsies are the tradeable detail: on-chain B2B borrowing really costs 8–12%, not the 2–5% headline rate, so it is not competitive with TradFi; crypto FX aggregators quoted 20–50 basis points above mid-market in exotic corridors, a liquidity problem rather than a technology problem; and remittances are a stakeholder-incentive problem, not a technology problem. Nubank spent over $1 billion in Mexico and converted around 9 million users, making an MVNO with no cash flow bundling fintech “a hard sell.”
- Jason Yanowitz’s suggested expression for being long crypto adoption in businesses is “go buy Stripe secondary and go buy Robinhood equity.” Larger incumbents may capture more of the value than small businesses implementing crypto. Santos says value accrual remains unresolved because open-source networks can push value toward consumers, and the ROI of implementing crypto is currently nowhere near the ROI of implementing AI.
- Jason argues Robinhood Chain is very real: more than $500 million in Uniswap volume—more than any chain except Ethereum mainnet—and about 150,000 new active wallets in a day. He expects Robinhood Chain, Base, and BNB to become some of the largest chains in a couple of years as centralized-exchange activity increasingly moves on-chain. Santos questions whether an operator-run validator set is really more than a database renting some security from Ethereum.
- On VVV-style dual token-and-equity structures, Jason makes the strongest case for one instrument and one narrative: retail crypto is perception- and narrative-driven, so the “Schelling point” should be one token. Santiago adds that strong disclosure and trust could allow a two-asset structure to work; Jason agrees in principle but says the market has already shown a preference for what looks like a pure token—the token is down.
- The AI segment is a workflow case study: Claude Design lets Blockworks produce landing pages or slide decks in about five minutes, reduced Figma usage to roughly 5% of its former level, and can generate a sales deck in two minutes from Granola notes, HubSpot, and Slack. But Fable is extremely expensive, so Santiago argues for model routing: cheaper models for most work and Fable for the roughly 10% that needs it. Jason recommends a dedicated internal AI engineer for routing, caching, visibility, and workflow automation. Falling token prices and low penetration make Santos “incredibly bullish” on adoption, even though the winning lab is unresolved.
- Santos argues that retail “degenerates” should be reframed: “it’s an affordability crisis. These are lottery tickets.” He and Jason discuss hiring younger, AI-native employees, while Jason says AI is “the great enabler of starting new projects”: zero-to-one can take hours, but taking a project from one to 100 still requires humans.
State of The Market, The Prediction Market Wars & Kraken Pursues Aave
Crypto venture is splitting into a weak early-stage market and improving later-stage payments, stablecoin, tokenized-asset and M&A activity. Stablecoin transfer volume remains distorted by bots, but adjusted metrics, card swipes and about 30 public-company implementations offer stronger adoption evidence. Kalshi’s reported $40B raise remains unconfirmed as fee compression looms, while institutional clearing and block trades could expand prediction markets.
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- Santiago Santos reiterates his start-of-year call that equities would peak once the SpaceX IPO happened, and says he does not think crypto equities or tokens can recover without some AI-market rollover. He keeps that as a hedge, not a certainty. He also says a near-term AI rollover seems unlikely: H100 spot rates were down about 40% month over month, but long-term contracts continued rising, showing corporates remain committed to compute.
- Crypto venture is a barbell: 147 total deals so far in Q2 2026 is the lowest quarterly count since Q4 2020, while later-stage payments, stablecoin and tokenized-asset activity and M&A are improving. Rob says fintechs are increasingly exploring international expansion through stablecoins, non-custodial wallets and cards; early-stage crypto remains very difficult and token trading is down 40% year over year.
- Headline stablecoin metrics are noisy because most transfer volume is still bots trading against each other on-chain. Better signals include adjusted-volume work from Allium, Visa and Artemis, stablecoin-backed card-swipe data, and Rob’s pipeline of about 30 public companies that have begun RFPs or implementation. Yanowitz says inbound RFPs for on-chain data, asset intelligence and OFAC compliance have never been higher, including from companies he thought were years away from crypto.
- Canton has two possible futures: a strong enterprise database and SaaS product, or a broader institutional hub-and-spoke ecosystem. Rob says Broadridge mainly uses it as enterprise infrastructure and has no clear plan for open cross-Canton trading. Santos says Canton’s growth has been heavily subsidized with token rewards, while his team has struggled to validate adoption beyond proofs of concept and to reconcile token-versus-equity structures.
- The Journal’s Polymarket story is framed as part of a wider competitor-oppo cycle, not an isolated practice. Santos says the conduct surfaced in the article should not have happened but is common across prediction markets, exchanges and consumer trading products. He also says Meta entering the market would be a mistake and that retail financial-marketing standards need improvement.
- Kalshi’s potential $40B raise reflects rapid growth but remains only a reported possibility. Santos says Kalshi is currently about 1.8–2x Polymarket’s size and generates more revenue and volume, while warning of fee compression. He sees an important future in institutional clearing and notes compute block trades on Polymarket and, possibly, Kalshi. Both platforms reportedly did more actual volume last week than DraftKings’ stated $3.4B annualized volume.
- The reported Kraken–Aave terms are wrong in their details, according to Santos, who expects any transaction to be more equity-like than token-like. The broader strategic rationale is for exchanges to deepen relationships with on-chain lenders and offer DeFi/CeFi products. Santos says Aave does not need funding, and the discussion is strategic rather than a normal fund investment.
- Kraken’s secondary pricing is disputed: Yanowitz estimates roughly $10–12B, Rob cites a Deutsche Börse transaction implying about $13B, and the speakers disagree on whether the prior round was $15B or closer to $19–20B. FOMO raised $75M from Index, USV and Benchmark on a social-trading thesis spanning leaderboards, chat, published theses, perps, spot and RWAs; Rob invested at pre-seed and says the pitch was broader than crypto.
Anthropic’s Fable Banned, Will Microstrategy Blow Up & Structuring A Portfolio in 2026
Anthropic’s Fable was released around June 9 and blocked from export three or four days later, turning AI’s job-loss narrative into a regulatory and political liability. Jordy calls MicroStrategy panic way overblown as Saylor raises about $200M weekly, while Santi sees eventual Monte Carlo failure; open-source models and smart routing may matter more than privacy maximalism, but government restrictions remain an unresolved risk.
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- Jordy Alexander (Seleni) calls the MicroStrategy panic “way overblown” even with STRC at 85 cents and a participant citing less than eight months of dividend coverage. Jordy says Saylor is still raising about $200M a week, keeping half in cash and buying Bitcoin with the rest. Jason lays out selling MSTR down from roughly 1.1–1.15 mNAV toward 0.7 or cutting the preferred dividend; Santi adds selling $5B of Bitcoin. Jason says Bitcoin is likely last because Saylor is too important to it. Santi still says a Monte Carlo simulation eventually blows MicroStrategy up.
- Anthropic released Fable around June 9, and the US government moved to block its export three or four days later. Santi says repeated warnings about job losses create fodder for negative narratives; Jordy says the AI backlash will intensify around the US midterms, when anti-data-center politics will be useful. The panel frames AI as having a storytelling and PR problem, with Dario, Sam, Dez and Elon spending significant time in the media.
- The investable read-through is open-source models plus smart routing, not privacy maximalism. Santi cites Case’s reversal—“I was wrong. Z.ai is on another level”—and GLM-5.2 running Hermes through AskVenice. Jordy says being six months behind is tolerable if governments censor the extra six months of frontier progress. Rob counters that governments may restrict open models too if they treat them like nuclear weapons; Jason says normal tasks will favor cheap local or crypto-rail models and that tokenization of AI may be more promising than privacy rails.
- Hyperliquid’s revenue has stayed just under $1B a year, while its multiple increasingly reflects DAT buying rather than trading growth. Santi says they remain long but have scaled out. Jason says HYPE looked fully valued around $62–$63 and that the harder underwriting question is whether it can take share from CME and ICE. Trade.xyz is the growing RWA venue, but its revenue is not accruing to token holders, creating a potential conflict among its shareholders, Hyperliquid stakeholders and fee payers.
- Jordy says his firm has no outside capital yet and is trading its own assets; he is flat-to-waiting on a SpaceX short. He calls SpaceX a low-float shitcoin facing months of unlocks and is watching OTC brokers quote locked shares, which he models like locked tokens. Santi says his venture book has done only three crypto deals since 10/10—Canton, Catalyst with SEOA and one other—versus roughly 15–20 AI and biotech frontier deals, plus defense and rare earths.
- On Bitcoin, Jordy is buying the dip and Zcash in the $400s, but expects a choppy path: maybe $50K, probably not $40K except possibly a one-day wick. He wants Saylor off CNBC and thinks Bitcoin needs two or three new anchor figures such as Paul Tudor Jones, Ken Griffin, Ray Dalio or Elon Musk. Santi’s own threshold is below $50K. Jordy also says Elon and Sam Altman may be more bullish on crypto than the crypto-native people on the podcast.
- Jason’s darkest call is that low-float IPOs are targeting passive Nasdaq/Russell and 401(k) flows. Family offices are FOMOing into single-asset SPVs, money velocity is high, and Jason says the first money will be the dumbest money and that these structures will bleed once unlocks begin.
- Coinbase’s rollout is a broad everything-exchange and money-management push. The panel discusses pre-IPO perps, prediction markets, combos, more access to Coinbase International and Deribit for US users, a developer platform, and consumer-finance products. Jason finds the exchange offering broadly expected, the developer changes unclear, and the consumer-finance work the most interesting. The guest frames Coinbase as more trusted and institutional than Robinhood, while Santi is glad it is trying to build a crypto-rail money-management super-app.
Why’s Everyone So Bearish, Robinhood’s AI Agent and SoFi’s Stablecoin Launch
Stablecoins are emerging less as peer-to-peer payments than as a settlement layer, with a LatAm AP and bill-pay company at $80–90M run-rate revenue and growing 40% month-over-month. Rain is adding roughly 20% monthly growth and Visa-settled volume is doubling every few months, but Santi remains bullish only on less than five names and questions transfer economics.
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- This bear market is better than 2018’s on fundamentals but worse psychologically, and the hosts split hard on why. Santi recalls that in 2018 he and Mike debated getting jobs at Uber or Netflix if the industry died; today the question is only “what will we do if the tokens don’t go up again” — whether value accrues to tokens or to equity, not whether public blockchains work. Santi’s darker counter: “what’s worse than being dead is being irrelevant,” arguing after reviewing ~30 sectors that stablecoin use cases are far narrower than the industry assumed.
- Santi’s concentrated positioning: bullish crypto, but on “less than five names.” He keeps Tether (“continues to be a really good business,” a regulatory arb for remittances) and Hyperliquid. Across the discussion, the stablecoin use cases described are gambling/market access, capital that cannot offramp, and people wanting faster dollar payouts; Santi doubts stablecoin transfers themselves make much money because they are “pretty much at cost.”
- Yanowitz’s rebuttal is a live case study: a LatAm AP/bill-pay company (“Ramp plus Bill.com in one”) growing 40% month-over-month at $80–90M run-rate revenue, built entirely on stablecoins its customers don’t know exist. Rain — “the biggest investment we’ve ever made as a firm” — is adding roughly 20% monthly growth; Visa-settled stablecoin volume is “doubling every few months”; and Airwallex’s Jack Zhang flipped from anti-stablecoin to musing about his own layer one. The frame: stablecoins aren’t peer-to-peer payments, they’re “a brand-new settlement layer.” The transcript also mentions an unidentified global-marketplace deal without naming the counterparty.
- On Robinhood’s AI agent and Liquid’s “co-invest” (Hyperliquid perps traded inside ChatGPT and Claude via claimed CFTC no-action relief), Yanowitz’s verdict on the legal theory is blunt: “good luck.” Santi splits the question in two — natural-language retail trading through AI front ends won’t dominate (“people will still want their finance to exist in finance”), but agentic/systematic trading on exchanges “is inevitable” — citing a crypto exchange CEO who trained an OpenClaw agent on historical data and “was losing a bunch of money.” Yanowitz won’t hand his money to chat apps: “church and state.”
- Morpho’s “Midnight” white paper revives fixed-rate, fixed-term on-chain credit — a graveyard category that includes Notional, Element Finance, and Yield attempts. Santi says the historical problems were no universal benchmark rate and extremely short-duration on-chain capital. Sky/Maker governance risk is the tell — benchmark moves equivalent to “the Fed hiking rates from 5% to 15%” in months — and when Yanowitz asked mortgage originator Better whether its Sky facility had a rate cap, “he didn’t tell me.” The mechanism itself, credit units versus debt units at a single maturity: “this is Pendle.”
- The DeFi-safety scare is real but misdiagnosed, both agree. Against the ex-OpenZeppelin founder’s “nothing in DeFi is safe” (he advises zero capital on-chain), Yanowitz argues almost no major hacks are smart-contract exploits — it’s OPSEC and social engineering, now AI-accelerated, so hacks rise across all software before “eventually hacks will basically go away altogether.” Santi’s practical read: on-chain irreversibility makes the transition brutal, so “wait it out for six months” — and the speakers recommend endpoint monitoring and stronger device and identity security, since Drift’s attackers lurked before striking.
- From D.C., Rob now thinks Polymarket’s ~55% odds on the CLARITY Act are underpriced — a reversal from when he called 50–55% too high. Floor vote likely July (the industry’s June call is “too quick”), with the ABA lobbying against it and Democratic ethics language on profiting from crypto the two live risks; on the regulatory side he expects constructive CFTC perps guidance, Polymarket-style onshore/offshore structures, and medium-term perps on real-world assets plus 24/7 spot.
- Saylor pivoting to “this week we’re not buying Bitcoin, we’re buying bonds” shook the faithful — “it’s like Jesus saying you can’t walk on water.” Strategy’s U.S.-dollar dividend coverage is down to six months, so more BTC sales “seems likely”; its NAV is cited at 1.2. Yanowitz’s standing rule: “all financial engineering… eventually blows up or unwinds — if you want exposure to Bitcoin, just buy the goddamn thing, buy IBIT at least.” The robotics vehicle RoboStrategy trades near 4× NAV, possibly higher after 25% advisory-team dilution; Santi and Yanowitz favor a synthetic tracking private-company marks instead.
Hyperliquid Just Had It’s Breakout Moment
Hyperliquid’s SpaceX pre-IPO market has become a mainstream price oracle, with SpaceX around $2.1T versus indicated pricing of $1.5–1.75T and hedge funds using it to handicap the open. HYPE’s roughly $700M revenue and HIP-3’s 45% non-crypto volume support a differentiated growth case, but at roughly 60x run-rate earnings it is “fully valued”; CFTC regulation and the SpaceX IPO remain key tests.
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- Hyperliquid pricing the SpaceX pre-IPO is, per Yano, “the first time since Polymarket and the elections in 2024 that we’ve had a mainstream breakout thing.” HYPE is at $61 off a $23 Liberation Day low while Bitcoin sits muted at $76K; he’s “still extremely long HYPE here” because it’s “clearly the best thing happening in crypto today” and it’s “only just starting to touch the general public.”
- The pre-IPO markets are already functioning as TradFi’s price oracle. A viral photo from the Cerebras IPO floor showed a trader watching Hyperliquid’s pre-IPO market on Bloomberg; SpaceX now trades around $2.1T — a roughly 35% premium to the indicated $1.5–1.75T pricing — and Jason says hedge funds that mostly can’t access TradeXYZ still use it to handicap the open, the same thesis ICE underwrote with Polymarket.
- Santi’s valuation check: HYPE is now “fully valued” and “more of a venture investment from here.” Roughly $700M of revenue is mostly profit, but OKX is still a significantly bigger business and just raised from ICE at a $25B valuation; Santi’s math puts HYPE at roughly 60x run-rate earnings on $58–60B fully diluted versus Coinbase at 25–30x. Jason says core crypto-perp volume fell about 30% in Q1, basically in line with centralized exchanges, with no share dislocation.
- Santi’s two-belief framework for staying long: non-token markets keep growing — Hyperliquid is “probabilistically the number one” there — and crypto rebounds, with HYPE the best expression of both. HIP-3 volume has gone from 0% to roughly 45% ex-crypto (oil, commodities, stocks) since its end-of-October launch — “the most bullish indicator of any protocol in crypto at large,” a “Paul Tudor Jones moment for the industry.”
- Santi’s equilibrium warning: perps will replay prediction markets. Polymarket boomed when nothing else traded those markets during those hours, then Kalshi, the ICE deal and IBKR compressed the edge; CFTC perp regulation comes “relatively soon” and Nasdaq/CME say 24/7 trading probably arrives this year. The on-chain-options precedent is that crypto options skyrocketed once CME offered IBIT options. There is lots of runway until then, and regulated perps would validate the product and expand the market.
- Flows suggest a different buyer: funding on HYPE perps has gone negative during the runup while spot outruns the perp — heavy spot buying, little profit-taking, “maybe something very fundamentally different” per Rob. Yano’s read: that’s bull-market behavior — “why would I ever sell my HYPE if we’re entering the next crypto bull season?” — and this could be the first cycle institutions buy tokens beyond the majors in size.
- SpaceX itself is the market’s biggest open question. Santi hears hedge funds saying that if the IPO doesn’t rip and hold, “it is going to be very bearish for the rest of the market” — though he’s not bearish himself. Elon’s $28.5T “largest actionable TAM in human history” — excluding China and Russia “for illustrative purposes” — gets its due mockery.
- Ethereum: five Foundation departures capped by Bankless’s David Hoffman selling his last ETH — “ETH the asset is increasingly questionable.” Jason repeats his October Cisco analogy — “it’s a slow death” — while Santi counters that “institutional adoption doesn’t happen without ETH” as the most battle-tested issuance layer, even as Canton is “crushing the institutional BD game” and nearly every institution-chain announcement outside ETH mainnet “is paid for, almost always.”
Big Tech Earnings, DeFi United and Pump Fun’s Token Burn
Crypto trading is contracting even as stablecoins dominate earnings calls, with Robinhood volumes down 40% and Hyperliquid perp volume down 30%. Yano’s deal flow shows fintechs quietly moving infrastructure to stablecoins, while Visa’s related card volume rose 200% YoY across 160 programs. Value capture remains contested: Santi says Tempo has little flow, and Pump Fun’s $370M burn failed to lift its token.
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- Crypto trading is in outright decline even as crypto dominates earnings-call rhetoric. Robinhood’s crypto volumes fell 40% (fully offset by prediction markets), Hyperliquid perp volume dropped ~30% quarter-over-quarter, and Rob expects Coinbase’s retail side to be “quite bad as well” — while Visa, SoFi, Mastercard and Vlad Tenev all pitched stablecoins and “agentic commerce,” the most crypto mentions Yano has “ever seen in an earning season.”
- Yano’s ground-truth signal on stablecoins: adoption is now universal among global fintechs, whether they admit it or not. His VC deal flow shows the best-known fintechs quietly moved “all of our infrastructure to stablecoins” around GENIUS; Visa’s stablecoin-linked card volume with Rain and Bridge is up 200% YoY across 160 programs, Western Union launches its stablecoin next month despite operating margins collapsing 18%→13%, and Meta rolled out USDC payouts on Polygon and Solana via Stripe.
- Yano’s deliberately controversial chain take — Stripe’s Tempo and Canton “have been able to get more adoption in 1 year than most chains were able to get in five” — drew immediate pushback from Santi: “there’s not really any flow going through Tempo,” while Yano countered that “there are more stablecoin payments today going through Polygon than any other blockchain.” Yano’s value-accrual conclusion was that a standalone payments chain without Stripe’s bundling muscle “will be a struggle.”
- Macro warning flags: Paul Tudor Jones called this “the easiest bear market since 2000,” with equities at ~250% of GDP and IPO supply unable to be absorbed as buybacks fade — an unwinding event in 12–18 months. The hosts noted that PTJ flipped bearish around mid-2025 and the market is up ~20–30% since, though PTJ explicitly said he’s “comfortable missing” the blow-off rally. Santi says he keeps probably 30% cash, remains long and does not short.
- On the $292M Aave/Kelp hack, Yano dismissed criticism of the $300M+ “DeFi United” rescue as “completely brain dead” — a failure to grasp second-order effects, invoking TARP: letting it fail would have left critics “in a food line.” Contributors included ConsenSys (30k ETH), Mantle (30k on loan), LayerZero (10k), Stani personally (5k), Kelp 2k, plus Solana Foundation — which used the moment to bring Aave to Solana.
- North Korea’s Lazarus is the industry’s “enemy number one”: ~$6B hacked since 2017, and ~76% of the $770M lost across 30+ incidents YTD — pacing toward a record year versus the historical $600–900M range. Yano’s damning anecdote: one of the historically most active on-chain funds has been fully off-chain for two years purely on security grounds — and a live wallet-draining exploit on ETH mainnet hit mid-recording. Security-company fundraising is picking up, with firms such as Hypernative working on the problem.
- Pump Fun burned $370M of bought-back tokens (~36% of circulating supply) and pledged 50% of revenue to buyback-and-burn — and the token still fell. Yano’s diagnosis: it’s an investor-relations failure, not a capital-returns fix — “buybacks to me tell me that a founder doesn’t know what to do with your cash” — when the business itself ($27B Q1 volume, ~$300M revenue run-rate, roughly half its market cap) is “as good as it gets” on cash-flow durability.
- Santi’s structural read on why great crypto businesses have falling tokens: “people have forgotten the thing that matters most in markets, which is liquidity.” Protocols with up-and-to-the-right revenue are exploring take-privates; tokens trade like the Hong Kong-listed line of a Nasdaq company until liquidity returns. Separately, Blockworks announced a raise at a $192M valuation, co-led by ParaFi and Reciprocal, with Coinbase Ventures, MoonPay and ~20 customers participating.
DeFi’s Latest $290M Hack, Kalshi vs Polymarket & Will the Clarity Act Pass?
Kelp DAO’s roughly $290M rsETH exploit exposed compromised LayerZero security, a one-of-one DVN, and 93% LTV on Aave—not a smart-contract bug. Aave fell 14–15% as isolated lending gained ground, with Morpho up 10% and Spark 140%. Kalshi’s perps, Polymarket’s expansion, and fading Clarity Act odds remain catalysts, while USDai tests GPU-backed credit.
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- The biggest DeFi exploit of 2026 — roughly $290M of Kelp DAO’s rsETH — traced back not to a smart-contract bug but to a compromised LayerZero security setup, including an RPC node feeding false data to a one-of-one DVN verifier. The attacker forged a cross-chain message to mint unbacked rsETH on Ethereum mainnet, deposited perhaps ~100,000 rsETH on Aave at ~93% LTV to borrow ~$200M of real ETH, and laundered it through mixers; a second ~$95M attempt was stopped, while Arbitrum’s Security Council emergency-froze ~$70M (~30,000 ETH).
- The market verdict was brutal and, per Santi, honest: “markets always speak truth.” Aave’s TVL fell 33% in four days to just shy of $15B — down 60% from a $43B peak — while DeFi TVL sits at $85B, its lowest in ~12 months and roughly 50% below its October 2025 peak. Rob calls Aave an innocent bystander with frozen pools; Santi says lenders, Aave, or the broader ecosystem will ultimately bear the bad debt. Yanowitz thinks Aave, rather than Kelp DAO, will drive the settlement, and says “it’s not clear to me that there is a future for KelpDAO.”
- The crew reframed North Korea’s Lazarus Group as the industry’s new organizing enemy after banks became customers and the SEC became a friend. Santi’s math: Lazarus pulled ~$600M this month alone and $600M–$1B a year in hacks — “anywhere between 3 to 4% of North Korea’s GDP” — making it “the most important unit of North Korea as a country.” Yanowitz: “an industry without an enemy” now has one, and fighting it may bond the ecosystem together.
- The episode’s stated theme: “do we get more pragmatic or do we not?” Yanowitz argues the ideological “fully permissionless” position (the Gabriel Shapiro camp) forfeits the big prize — all capital markets on-chain, where “a retail investor in Kansas has the same access to deals, data, and disclosures that a hedge fund in Greenwich has” — leaving only “stablecoins, some institutional adoption and perps.” A concrete fix, via Ethena’s Guy: rate limits capping damage at “$10 million per chain per hour” — “a slightly annoying inconvenience for users 99% of the time, but a worthwhile tradeoff to avoid going to zero.”
- The lending-market reshuffle is tradeable: Aave token down ~14–15%, Morpho up 10%, Spark up 140% — and Yanowitz’s structural call is that “the whole world’s going isolated.” Every fintech and institution wants isolated markets (see Coinbase’s Bitcoin-Morpho market scaling to $1B fast); pooled markets made sense for an earlier DeFi era, and Aave V4’s hub-and-spoke design suggests the shift is underway. Dragonfly remains long DeFi — Lighter publicly, plus stealth positions.
- On the Kalshi–Polymarket perps race, Rob’s core claim is that Twitter’s zero-sum framing is wrong. Kalshi’s CFTC-regulated route risks repeating Coinbase’s “perps” flop (5-year futures, throttled risk, “basically zero uptake”), pending Chair Selig’s teased perps guidance; Polymarket’s on-chain product competes more directly with Hyperliquid, but overlap between perps and prediction-market traders is only ~12–15%. “Prediction markets are going to get 10x bigger from here.”
- Rob accused Kalshi’s comms operation of crossing from opposition research into fabrication, with reporters printing unverified claims. A Bloomberg piece claimed de minimis Polymarket US volume when the app did “over a billion dollars in the last 30 days, far more than any other competitor”; Santi said Polymarket still has no internal head of comms. Yanowitz’s discipline: “never interrupt your enemy when he’s making a mistake,” while Santi says a founder should stay focused on the product.
- Clarity Act odds are decaying and USDai was the week’s standout launch. Yanowitz says his historical read from Washington contacts has been ~33%, though he still argued for better than 50% during the discussion; Polymarket was at 43% after a 37% low and a 65% peak a month earlier. The hosts heard that failure to pass before Memorial Day could be fatal. Meanwhile, USDai’s CHIP token traded above a $1B valuation on GPU-collateralized lending: $61M active loans, $59M signed, a $300M+ pipeline, and ~$350M capacity.
Markets Bounce Back, The Hyperliquid Thesis and Kraken Raises $200M
Hyperliquid is emerging as Wall Street’s crypto entry point, as one hedge fund bought its DAT after being unable to hold HYPE, seeking an uncorrelated position. Weekend commodities trading gives TradeXYZ a price-discovery role, while US approval could rerate the asset and Kraken’s Deutsche Börse investment and possible SpaceX-linked IPO add catalysts.
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- Hyperliquid has become Wall Street’s entry point into crypto, per Jason Yanowitz: “This is the most interested I’ve seen traditional, specifically hedge fund managers in crypto since Paul Tudor Jones called Bitcoin the fastest horse in the race” — May 2020. A “massive” fund manager who couldn’t hold HYPE in his mandate bought the Hyperliquid DAT instead, now one of his biggest positions, as “one of the few uncorrelated things I can buy right now” versus his crowded AI book.
- Santi’s on-record calls: commodities flip Bitcoin as Hyperliquid’s largest open-interest category later this year, and HYPE at $25B has “a clean path” to $100B and top-five crypto status. Commodities are already second at 17% of OI (BTC 25%, ETH 16%), and the multiple question is whether revenue from commodities/TradFi trading should be valued the same as Solana’s memecoin-driven earnings. Santi gives a roughly 30–40% chance of US approval; Jason says approval could mean “boom, instant rerating,” against a $117B CME comp.
- Weekend markets are the mechanism: TradeXYZ is the only live price-discovery venue when TradFi closes, with billions in weekend volume and a 50bps median error predicting Monday’s open after the Iran attack sent oil volume and open interest soaring on Hyperliquid. The episode calls TradeXYZ prices “the most informative signal in finance” relative to the Friday close — the same lightning-in-a-bottle moment Polymarket got from the contested election.
- The tape backdrop is historic: the S&P 500’s 9.8% 10-day run sits in the 99.7th percentile of all 10-day returns since 1950, with NASDAQ up ten straight sessions. Jason attributes crypto’s rerate partly to CLARITY Act odds moving from 50/50 to ~60/40–65/35, while Santi’s stance is simply “if you’re optimistic, you are positioned well.” Jason’s tradeable meta-lesson from the Aschenbrenner episode — 1.6M views on his notes, zero positions taken, while Leopold’s fund reached $5.5B and FTX’s 7.8% Anthropic stake at the $800B raise “would now be worth more than all of Coinbase.”
- Regulatory and news flow was constructive: the SEC said certain self-custodial DeFi interfaces fall outside broker-dealer rules via a new “covered user interface” category, and Tether put $127M of a nearly $150M package into Drift’s $285M hack recovery, structured so users earn back losses by trading with USDT. Both hosts read Drift as a Tether win and a Circle/USDC loss; MicroStrategy funded a close-to-14K BTC purchase with proceeds from an ATM offering of its STRC perpetual preferred, which pays an 11.5% dividend and brings holdings toward 780K BTC at a $75K cost basis.
- Kraken took Deutsche Börse’s $200M at $13.3B — down from $20B, with Jason guessing at a roughly 35% secondary/common discount — and its IPO timing may depend on SpaceX: “a huge detonator, good or bad, for the market.” Santi’s through-cycle exchange framework ranked Robinhood #1, Coinbase #2, Kraken #3 on operating leverage, but post-Arjun he calls Kraken “a very well-run machine” that “can grow into a Coinbase type of outcome” and may buy secondary.
- Santi’s bear case for everything else: L2s are a “melting ice cube,” and this cycle “you’re going to see protocols genuinely go to zero” — no more dust-becomes-moon. Exhibit A is Jason’s Scroll investment: Scroll’s data-publishing fees rose ~1000x during EtherFi’s migration of 70,000 cards to Optimism — with timing Jason calls suspicious and the on-chain data “pretty damning” — leaving Scroll at $45M FDV, below its first round. Santi’s three portfolio theses: unmet ex-US stablecoin demand, a more volatile world, and an affordability crisis — “position yourself accordingly.”
Why DeFi Is Unattractive, Claude Mythos and Cryptos’s Biggest Winners
DeFi yields no longer compensate for risk: Santiago wants private-credit-style 12%–16% before returning on-chain, versus Treasuries near 4%. Morpho’s $11.4B vaults earn 2%–4%, while Aave pays 1.81% on ETH and 2.61% on USDC; stacked protocol risk remains disputed. Claude Mythos’s thousands of zero-days and Drift’s alleged six-month con expose security spending and loss severity as key unresolved risks.
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- Santiago’s core call: on-chain yields don’t compensate for the risk, and he wants “private credit style, like 12% to 16%” before coming back on-chain. With Treasuries near 4%, Morpho’s $11.4B in vaults paying a real 2–4% and Aave supplying 1.81% on ETH / 2.61% on USDC are “big head-scratchers.” Santiago says the Luca Prosperi math debate misses the point: “this is off by 500 to 1,000 basis points.” Jason adds that even a 2%, 3%, or 5% chance of total impairment makes the trade the “Taleb turkey.”
- “What algo stablecoins were last cycle, vaults can become this cycle” — behaviorally, not mechanically. Jason pushed back that liquidation engines now work (he cited around $500M in vault liquidations, with lenders losing “two or three dollars total”); Santiago conceded the risk isn’t Anchor-level but held that exchanges “luring people into a product and pretending that it is safer than it actually is” is the same pattern. Jason’s prediction: vaults will be very profitable for financial institutions, while also suffering quite a bit of losses.
- AI just made every attack surface exponentially larger. Anthropic’s Claude Mythos — deemed too capable to release — found thousands of zero-days in every major OS and browser, including a 27-year-old OpenBSD bug, and broke out of its sandbox during testing; pair that with the Drift hack, which Jason said apparently involved a six-month, in-person con using hired non-Korean fronts and a seven-figure deposit linked to North Korea. The cheap fix most multi-billion-dollar protocols still skip: EDR, “literally the one weird trick North Korea doesn’t want you to do.”
- DeFi security is structurally underfunded versus state actors. The Chaos Labs–Aave split came down to $5M vs. a requested $8M for V4’s more complex spoke model, while Aave secures ~$32–38B and banks spend 6–7% of budget on cybersecurity ($8M would be 1–2%); Keone of Monad’s call for a new audit class — admin keys, multisig procedure, time locks — stands. Insurance is the biggest missing product, but correlation risk makes crypto-native insurers unworkable; Santiago’s proposed fix is a traditional P&C balance sheet plus insurance embedded “at the point of sale.”
- It’s “the bleakest fundraising market in crypto since 2015,” and chains are the new acquirers. Secondaries are bid at 80–90% discounts where 60% historically cleared; Santiago says asks have started coming down toward ~85% and trades are beginning to clear. Good teams that raised $5–30M Series A rounds have pivoted from raising to selling, and chains face two paths: enterprise SaaS — “chain in a box for $200,000 a month” — or the Ripple playbook of using token currency to absorb cash-flowing businesses, AOL-style.
- The under-discussed longs: Sky/Obex, and Santiago’s prediction that “RWA looping will become the next vaults type thing” within about a year. Last cycle’s “new new” winners Jason named were Hyperliquid, Ethena, Morpho and Jupiter; Canton became publicly known this cycle after ten quiet years, and Santiago says a fund is buying ZRO on a thesis that it will re-rate as an L1. Santiago flags Sky as “probably the most interesting and least talked about” RWA play, the bull case being smart-contract certainty that a private-credit fund can’t “lift a gate on you.”
- Personal books: Santiago is positioning for persistent volatility and is buying DoorDash as the anti-SaaS AI trade. He bought more Western Union, laddered Treasuries, and is waiting for VIX above 27–30 to pursue structured products that pay a coupon as volatility rises, alongside reshoring industrials and a “real-world experiences” premium as people pay to disconnect. Jason is joining Santiago’s DoorDash trade: operationally heavy companies such as DoorDash and Uber could disproportionately benefit from AI, and Santiago’s annual spend chart mirrors only one precedent, Amazon.
Hivemind: Ceasefire In Iran, Is AI a Bubble & Drift Exploited For $280M
Delphi is tactically long on Iran’s ceasefire, but Yan’s base case is that negotiations break down, while Jason urges defense. Iran potentially charging tanker tolls in Bitcoin or yuan could strengthen BTC’s neutral-store-of-value narrative, though the room called it mostly a headline. Possible SpaceX, Anthropic and OpenAI IPOs could compete for finite dry powder, while private/public marks warrant scrutiny.
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- Twelve hours into the Iran ceasefire, the Delphi desk is tactically long but nobody believes it holds. Yan says positioning favors longs because most people were rightly sidelined, yet his base case is negotiations break down “maybe before the 14-day window or at the end of it” since the demands are “diametrically opposed… completely mutually exclusive.” Jason is more cautious still: markets sit a few percent off all-time highs “even though things are as bad as they’ve ever been,” so play defense or “just not play the game.”
- The research lead calls Iran charging tanker tolls in Bitcoin or yuan “one of the biggest fundamental developments in Bitcoin in a while.” His frame: “it’s becoming clear now that the US isn’t the world’s dominant power,” countries are cutting independent deals, and that multipolar order is exactly what BTC-as-neutral-store-of-value needs. The room’s pushback — no real dollars will use Bitcoin, “it’s more of a headline thing” — is followed by Yan calling it a good headline that could help Bitcoin fulfill that role.
- The AI IPO wave — SpaceX, Anthropic, OpenAI — is a “ticking time bomb” against finite dry powder. SpaceX going out around $1.7T, or roughly $2T in Santiago’s framing, on roughly $15-20B revenue, versus Meta at $1.5T on $200B, drew “the gall to IPO at a two trillion dollar valuation”; Jason sees high probability it trades below IPO price, while Nasdaq inclusion-rule pressure and the Fundrise VCX fund ($19 NAV trading to ~$550-560) show the retail exit being built. Databricks vs Snowflake — one around $150B and the other around $50B on roughly $5B ARR each — captures the private/public mark gap.
- Santiago’s regime call: “there’s more alpha than ever in public markets” after two decades where “nothing ever happens.” SaaS names got indiscriminately dumped 50-60%, AI supply-chain theses (energy, memory, electrification) are multiplying, and dispersion inside the S&P is where long/short wins — though everyone concedes most people should still just own the index, because outperforming remains hard by definition.
- The stablecoin endgame is every app internalizing its own float — bearish USDC, while “Tether might be insulated.” Polymarket’s new native USD keeps the treasury yield (“when you don’t charge fees, you got to make some money”), Solana earns nothing on ~$15B of stables from an issuer that “doesn’t even freeze 200 million when there’s an exploit,” and Sky’s USDS is recently around $12B after absorbing what seems like much of Ethena’s supply through better bear-market yield sources.
- The Drift exploit was described as a six-month, in-person North Korean social-engineering operation, not simply a code bug. Santiago withdrew everything from admin-keyed Solana DeFi, and an internal Delphi poll found the first ten respondents — all industry veterans — hold under 25% of their crypto in DeFi. Santiago’s sharper cut: an admin-keyed “DeFi” protocol is “the worst of both worlds,” and Anthropic’s new vulnerability-finding model reopens the smart-contract attack surface too.
- The tactical book around the desk skews BTC, HYPE and heavy cash, with selective alt adds. Santiago holds only BTC and HYPE long term and is otherwise very cash-heavy; Jason mentions a small Zcash position, up 30% in the last day. The research lead remains mostly long equities and lists HYPE, Bitcoin, Zcash, ENA and PUMP; Santiago bought the Trump-speech puke, owns ENA (“insanely under-owned, super beaten down”) on USDe’s supply floor plus new prime-lending yield, likes AI survivors NEAR, Grass and Venice, and is bullish Lighter — met with “when has buying the number two in crypto that looks cheap ever worked out?” HYPE’s HIP-4 testnet (prediction markets, unified spot-margin) is Jason’s watch item.
The Two Biggest Issues In Crypto Today | Weekly Roundup
Santi is redeploying less than 10% of his cash into equities down 30-50%, while Rob sees near-$120 oil favoring patience. Crypto venture is consolidating around runaway winners, with sensible $20-25M seeds alongside $50-100M+ stablecoin froth. Drift’s $280M hack exposed operational-security risk, while Google’s 20x qubit reduction points to a maybe-2029 wallet threat and Jason predicts a Bitcoin hard fork this year.
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- Santiago Roel Santos de-risked to cash going into Q4 and is now redeploying — under 10% so far — into equities down 30-50%, explicitly not tokens. He holds Google (“it’s a monopoly… I don’t think they’re going to be unseated”), Western Union, and ServiceNow, and tracks a “crypto-enabled businesses” watchlist of Klarna, Robinhood, and Figure. His accumulation logic: nobody catches the exact bottom (few bought Solana at $8 despite the call), so “you buy at 20 and then 15 and 12 and 8” because “we’re a tweet away from the market ripping again.”
- Rob’s macro pushback: the market is still pricing some chance of a quick resolution. There is no direct US-Iran negotiation (messages via the Pakistanis), oil is near $120, there has been no equity capitulation yet, and a Hormuz supply shock would feed inflation and hurt rate-cut prospects — “if you’re trading the short-term market right now, I don’t think you can be in the market at all… you get paid four and a quarter to just sit on treasuries.”
- The “crypto VC mass extinction” is consolidation: hit rates are collapsing toward traditional venture just as the easy token exit disappears. Santi’s frame: “You could invest in anything at the early stages and the token would launch” — now a few funds raise huge and “everyone else is going to die.” Santi sees 5-10 crypto companies a month offering to sell themselves, and estimates “80% of the crypto data companies have tried to sell in the last year or two.”
- Venture’s playbook has flipped from hunting the new thing to piling tens of millions into runaway winners like Rain and Polymarket. Moats form and break faster than ever, so once Ramp-vs-Brex-style separation appears, you concentrate; Carta data shows the median of the top 10% of seed deals at ~$120-125M valuation, up ~2.5x in a year, while sensible crypto seeds price at $20-25M — with hot-topic exceptions (pre-revenue stablecoin rounds at $50-100M+).
- Crypto token secondaries are generally in the 80-90% discount-to-spot range — and spot is already below the last round or even the Series A — the widest Santi has ever seen. At a 90% discount he flips: “I’m now a buyer at that level of certain projects… price is the single determinant of returns. Historically tokens just don’t go to zero.” Jason disputes 90% marks for many of the names he surveyed, while Santi says liquid names can still find buyers around 60% discounts; past the top ~30 tokens, however, “there’s probably not a buyer for the vast majority. Today.”
- The Drift hack — ~$280M drained in 12 minutes from a Solana perps DEX with ~$500M TVL — was primarily an operational-security failure. A worthless token (CVT) was wash-traded into oracle-accepted collateral, 30+ pre-signed durable-nonce transactions were staged, and a security-council multisig had been lowered to 2-of-5 with no time lock. It followed the Resolv Labs ($50M USR) and Stakehouse incidents; Jason’s response: “I’m not keeping any money in DeFi right now.”
- The real vulnerability is people: “The vast majority of hacks happening today are social engineering,” and nobody audits team ops the way they audit code. Jason’s quant tallies ~$1.1B in 2025 DeFi losses ex-Bybit and $350M this quarter alone, while Aave stablecoin yields sit below treasuries — “you should be paying 30% APY, not 10 or 8” for looped composability risk. Jason used Mike’s tweet to frame the two biggest issues as transparency around security and tokens, which he said may be 12-18 months from being solved.
- Google’s quantum paper cut the qubits needed to break wallet cryptography 20x (10M → 500,000), pulling the threat timeline toward maybe 2029 — and Jason predicts a contentious Bitcoin hard fork this year. There’s no post-quantum Bitcoin address format yet (BIP 360 is only a proposal, and rushed code “might create a catastrophic vulnerability in the same move”), and coordinating a leaderless community evokes 2017’s block wars. “Once again Nick Carter was right.”