DEFI

“So, in the US, for example, if you win gold, you make 37 a half thousand. Compare that to the 250,000 that we're paying if you win an event. Massive difference. In Germany, where I'm from on Cru, where we're both from, uh the prize money for for gold that Germany pays you is €20,000. So, it's really nothing. And so we had one female swimmer, she won gold at the Paris Olympics in 2024 and she was saying like, "Hey, I've now represented my country on the highest level, won the highest award there is in my sport after having dedicated my lifetime to the craft and I make 20,000 euros, but if I go to Love Island, I'm going to make at least three times as much from just rocking up there. So how is that possible?"”

“Think about it like Formula 1. When the engineers of the Formula 1 team designed the Formula 1 car, that's at the forefront of scientific innovation and technology, that Formula 1 car is never going to get mass-produced. But what the engineers learn in developing that form car in some form of a derivative is going to trickle down into the world car production a few years down the line. So the anti-blockage system that you have in almost every car today actually comes from motor racing. very similarly for us would help Christian Golam, a Greek swimmer that broke the first record last year as an enhanced athlete. What helps him break a world record is way too complicated for an average Joe like myself. But the work that we do with Christian and all of the other athletes is constantly improving our product offering and our prescription guidelines for the people at home.”

“And then, of course, in 2026, we have a sharp increase in global energy, oil and natural gas prices due to the hostilities in the Middle East and the closure of the Strait of Hormuz. And so certainly that is a non-monetary policy shock this year.”

“Honestly, the big winners, like, the fundamental compounders that I see this cycle are kind of like, you know, the Ave Morpho Sky Maples Caminos of the world. Right? I think I I think a lot of these Apollo type folks are gonna look at this world and be like, what? I get this. This makes a ton of sense to me. So, anyway, that's like my I think that that this next cycle is just all about that, to be honest.”

“Nothing we can really do about that apart from, you know, clean up our act as it relates to some of these things we've just kind of brushed under the rug, like, having one of one multisigs for, you know, securing nine figures. I think, like, 97% of layer zero DBN setups were one of one or two of two. So, like, that's a problem. That should be addressed. Yeah. Can I can I just add one small thing? You know, back in the day at Chorus one, we looked at a lot of these interop networks, and we used to optimize as both investors and users sort of the most secure bridge.”

“Bilateral goods trade exceeded 55 billion last year, up nearly 10 percent, and yet the trade deficit keeps widening. China now accounts for a staggering 74 percent of Spain's total trade gap. So what is Sánchez actually up to? Is this a sophisticated bid for strategic autonomy, a bid for a Spanish brand of leverage between Washington and Beijing? Or is it, as one analyst put it, an increasingly one-sided and unbalanced pilgrimage?”

“On Monday at Tsinghua University, he delivered a speech defending multilateralism, calling the EU trade deficit unsustainable and to the astonishment of some, describing Spain as a country that recognizes China is rebuilding its greatness and is destined to play a vital role in the future. He called on Beijing to do more to push the adherents to international law and to end conflicts in Lebanon, Iran, Gaza, and Ukraine, especially now that the United States has decided to withdraw from many of these fronts, he said.”

“Wouldn't you imagine if institutions are looking at this, they see the power of utilizing smart contracts as a better way, obviously, for yield and and lending, but won't wanna do it in a decentralized manner. And this may actually, ironically, push them to use the technology to build centralized walled gardens to offer yield for their own customers and not be a part of the larger system where there's potential contagion. Like, why doesn't Goldman Sachs just have a Goldman Sachs, like, you know, it's not DeFi, but the centralized lending put it all together themselves and close it off.”

“It literally was a hairdryer. It literally was a hairdryer. They've charged the guy. I mean, you could see a barbed wire fence. So, I mean, there's some sort of security protocols in place here. I'm not sure how much, but he made $36,000 by walking up to the weather sensor. It was a unguarded thermometer near a Paris airport runway. He just pointed a hairdryer at it, entered in with two k, and almost did, basically, a 15 x there.”

“In this case, using, the restaked ETH token, via, KelpDAO, essentially, layer zero accused the Lazarus Group of exploiting their decentralized verifier, network, with the way of essentially faking withdrawals of restaked ETH on, Ethereum, which then caused restaked ETH to become undercollateralized. Obviously, then you have a bunch of this token that doesn't actually necessarily even exist. But according to this bridge, it does.”

“The Lazarus Group, deposited, 228 or or sorry, $270,000,000, worth of, this wrapped, restaked ETH onto the Aave protocol. They get to withdraw $228,000,000 of, wrapped ETH. And now all of a sudden, you have a bunch of bad debt because there's a bunch of, tokens that don't actually exist that have been deposited and a bunch of real money that does exist, which has been taken out by a bad actor.”

“The other the other kind of weak point here was that the KelpDAO team used, like, a one of one DBN, which means that you're just relying on the layer zero laps, sort of core infrastructure. If they had used, you know, a deviant set that required two of three or something like this with different independent operators, it would have been this much harder for North Korea to, like, compromise each of these independent organizations. So I think that was that was clearly a failure as well as is using a one of one implementation was, you know, not the right choice.”

“In this case, using, the restaked ETH token, via, KelpDAO, essentially, layer zero accused the Lazarus Group of exploiting their decentralized verifier, network, with the way of essentially faking withdrawals of restaked ETH on, Ethereum, which then caused restaked ETH to become undercollateralized. Obviously, then you have a bunch of this token that doesn't actually necessarily even exist. But according to this bridge, it does.”

“The new market is agents accessing something because it's reliable when it works and it's secure. And I think that market is just getting started, and I think that's a massive opportunity right now for both Morform and Aave and human trust brands as well as new entrants that are popping up.”

“I mean, changing the binaries, managing to carry out a DDoS at just the right time and being able to then trick the RPC nodes into essentially providing a view of the world. It's all quite sophisticated and clearly, I think it looks like a nation state level, so I think the Lazarus attribution is probably correct.”

“It comes at a moment when Spain has emerged almost improbably as the most outspoken voice in all of Europe, challenging the direction of American foreign policy. Just weeks before this trip, Spain took the extraordinary step of closing its airspace to US military aircraft involved in the war in Iran and denied Washington the use of the Rota and Morón military bases in southern Spain. Trump threatened to cut off trade with Madrid. Secretary of State Rubio accused Spanish leaders of bragging about it.”

“I was at a Galaxy event hosted by Mike Novogratz at his house in New Orleans last November, and Paul Tudor Jones came and kindly spoke to the group, giving his whole history and how he got into Bitcoin and how he approached everything. And one thing that is really, I think, very important about him, he's obviously one of the most recognized and important hedge fund managers of all times, frankly, especially in the macro space. And he was really the first to publicly adopt Bitcoin and push it and even write a paper about it.”

“JPMorgan Research has pointed out that yield-bearing stables are growing significantly faster than traditional stables. I would call it 15X faster right now, though. Noting for everybody, coming off a small denominator is much easier than coming off a large denominator. 15X size from current non-yield-bearing stable coins would be a giant amount of money.”

“The second this hack happened, behind the scenes, they're coordinating with law enforcement. They're coordinating with all the bridges, all the all the people that they could. They're blocking UIs, this address from UIs. They're putting this address on all these lists. And, like, the infrastructure of c o nine one one is really the hero here. Like, I feel like the security council is getting a lot of credit for executing, but the the real execution happened to layer up, and it's c o nine one one.”

“The two problems with private credit are illiquidity and lack of transparency. Stretch is liquid and transparent. And so I think you're going to see people typically look at preferred stocks and they're like, well, it's this tiny bit of the market and like the TAM is not really going to grow. But I think it's going to grow massively because you're going to see this huge wave of capital moving out of private credit.”

“Lazarus Group obtained about $2,000,000,000, in hack proceeds last year from DeFi and crypto. That is a non trivial amount, and the exploits here are getting far, far more sophisticated. So a part of this story is we could be doing better in terms of multisigs.”

“I think the real breakdown here was, you know, not necessarily that KelpDAO ran a one-of-one between Arbitrum and ETH Mainnet, but it's that Aave allowed it to be a collateral asset without properly vetting the bridge risk of the one-of-one. I think Aave is not without fault here. They did have, you know, one of their key risk teams walk out earlier this month. That was Chaos Labs. And Omer Goldberg did a very good post on X, explaining like a lot of the things that we could have added in terms of sanity checks and circuit breakers.”

“The way that they were able to do that was by effectively exploiting the OFT, which is basically a cross-chain boundary bridge between two chains. In this case, it's an implementation provided by LayerZero. But the infrastructure can actually be run by anyone. They were trying to lock a value which was not actually held on Arbitrum, and they effectively spoofed a packet saying that Arbitrum received 116,000 RS ETH, and now you're clear to go ahead and release that to this address on maintenance of Ethereum.”

“None of these STRs, whatever you call them, none of them are gonna make it except Sailor. I mean, maybe BM and R. I'm not even sure about them. But if they don't make it, the token market is, like, it's all toast. Now I don't see, hate to be like mister negative here, but I think we go for another round down Bitcoin because there's too much money that's just dying to get the fuck out of XXI and NACA and all these, you know, like, none of these companies have done shit, man.”

“One of the few things I've been following over the weekend because it's just so fascinating and validates something that we've been worrying or warning about in the space for for many years is the the draining of multiple DeFi protocols by hackers because the virtual machines that they're running on aren't as secure as as many people were led to believe and are not as decentralized as many people were led to believe either. So that, like, if you have a bunch of DeFi actors going aping in the stretch and they're doing it on insecure protocols or using insecure smart contracts, could could get interesting there as well.”

“The way I describe it right now is we're about six months into a pretty deep bear market. Traditionally, bear markets have lasted around twelve months before activity started recovering. That kinda makes me think that by the end of this year, we'll be looking a little bit better. We won't be out of the woods yet, but I do think 2027 will be quite a good year.”

“I'll tell you. Rescuing funds is way easier than redistributing them. That is always the hardest part. ... I'm gonna be very interested in watching this conversation unfold because, yeah, we'll we'll we'll see what happens. ... the devil's really in the details of these things.”

“That's like Pete Rose betting on his own team. It's a little like Pete Rose. Pete Rose had kept him out of the hall of fame because he bet on his own team. Now if he bet against his team, that would be no good, but he bet on his own team. I'll look into it.”

“So what happened is that there is, a bridging mechanism for RS e to go to other chains. This is called a lock and mint bridge. So, basically, the RSE is is natively issued on Ethereum. And so if you want to go to, another chain like Arbitrum, you would then lock the RSE in the this is a layer zero bridge on Ethereum, and then it would send a message which would mint the, RSC. It's like an IOU for the backing that's sitting on Ethereum. So what happened is that, there was a forged message, from the security mechanism within the layer zero ecosystem. Again, this North Korea was able to penetrate deeply into the infrastructure layer here.”

“Bitcoin and dollar near in near perfect opposition. It hasn't been this extreme in almost four years. So for traders for Bitcoin traders, the direction of the DXY, this is the dollar index. The thirty day correlation here between the dollar and Bitcoin is now negative point nine. It's the most negative reading since September 22. A below zero reading indicates inverse relationship. So that means when the dollar weakens, Bitcoin gains and vice versa.”

“Look at this meme coin. Look at this meme coin. What if I told you it's a traditional stock of one of the largest companies out there in its space at least? This is Avis. Avis, the car company, the car rental company. This was a short squeeze. A couple hedge funds corner the market here, and there was it was one of those classic situations. There's, like, more floating shares than there's real shares. Short squeezed up, and now it's just the correction. It became worth more than all the other car rental companies combined.”

“It's been a month for DeFi. 500,000,000 some 500,000,000 mostly between Drift and Kelp, but it's not great. Not great. You know what this reminds me of is do you guys remember it it just feels very reminiscent of the post FTX c five blow up.”

“So, so I started my career in biotech. Um I was like uh 20 didn't know a lot of life but sometimes you need to be at the right place at the right time and need to be bolded. So I uh I talked two of my professors into starting a biotech company with me uh which became very big. I didn't check the market cap meaning I sold years ago but it's called Alnum. We pioneered RNI technology. It's roundabout like people can look it up alny as a ticket but again I'm sold years ago but like I think it's a $50 billion company now like it became wildly successful it's a very iconic biotech company where I have actually and actually that is maybe as an anecdote so I'm doing biotech which makes me very old like since 27 years again I started early and since I'm in biotech I was quizzing all of the people I met and because of the success of a lot of cool people early and I was like why the hell are we only focusing on nichy diseases which originally was the mantra of biotech for 20 years.”

“It is really happening. Floor prices across the board of OG collections from the first cycle, Bored Apes, Deadfellas, doing the whole thing. I I understand most people would think that this is nonsense, but it it it's it seems to me that there is a correlation between the flight from DeFi and people wanting to custody their ETH in cryptographically verifiable art, and I don't think that's a trend that's gonna end anytime soon.”

“Just ask yourself, like, does de dollarization need need to happen? Does the Petro yuan need to happen? Do do we need to enter into thousand percent hyperinflation or, you know, massive, unprecedented big print? All of which is possible. But do we need that for Bitcoin to be an attractive investment, for Bitcoin to be an attractive technology to use for for payments at the sovereign level, the institutional level? And I, you know, I think I think the answer is definitively no.”

“WAP is, like, emerging competitor to Stripe. 2,000,000 businesses and, like, 20,000,000 creators hold assets on WAP. They had a partnership with Aave and Plasma and Tether, right, to just if you're holding money on their platform, hey, you wanna earn some yield? They're gonna deposit that into AVE on plasma in the background. And so so it's defi mullet cases, which I think could have gotten big, big chunks of depositors just because, you know, it's all abstracted away. Now that's gonna be kinda hard. Right? Because those risks and, you know, if I was just talking about an ETH depositor that didn't know about kelp kelp DAO.”

“I'll tell you. Rescuing funds is way easier than redistributing them. That is always the hardest part. ... I'm gonna be very interested in watching this conversation unfold because, yeah, we'll we'll we'll see what happens. ... the devil's really in the details of these things.”

“I expect the same thing here at d five. I think it's reached probably a bottom, and it's gonna take maybe a year or two plus. Then it'll come back in a massive way, and I think there's gonna be some great innovation learning from these problems and then, yeah, new protocols and primitives being built.”

“This is a core tenant of blockchain technology that we just don't talk about. Blockchain technology is open, modifiable. It's it's it's, it's just code, right, running on servers and social consensus. And that social consensus piece is the thing that destroys the idea of immutability. It destroys the idea of, like, you know, complete, agency. I mean, it is it does have agency, but it's like, it can be persuaded.”

“Bitcoin has made it in the sense that it's still really the only institutional asset class, like, fully institutional asset class. So it's gonna start behaving like institutional assets behave. The original value prop of Bitcoin was you should buy this because this thing might 20 x in your face. And no one believes that anymore, and that's good if you are a kind of like a goal you you don't really wanna buy some there's a whole the big pockets of money in the world don't wanna buy things at 20 x because if it 20 x's, it can go down 90%.”

“It's by the way there's one company out there which does that perfectly people just don't know it or know it they know the company but like not the business model because they're not public which is Red Bull uh if you look at Red Bull yeah it's a consumer product um but they own various sport events. Um, it's not public, but my guess is uneducated guess is that at least some of them are really profitable or at least value a creative like the Red Bull Formula 1 team. Um, but the vast majority of the brand value of the Red Bull Formula 1 team is going to Red Bull. So, they make money or they build up value by owning it and they have this massive translation into their consumer product. And that's very simple or simplified said like what we are aspired to become.”

“we need sort of, like, independent risk ratings within within DeFi. Right now, there's, like, a a, like, an incentive problem with, with, like, the the managers of these risk curators, I guess, is the term that's used. So, like, basically, the ones who are optimizing for growth, revenue are the same ones that are underwriting the risk of the collateral that are being onboarded. And so this is not what happens in in TradFi. There's, like, the risk side and the growth side are two separate and, like, you know, walled off entities such that the growth side submits a proposition to the risk side and the risk side from purely risk, like, sort of perspective says if it's if it's a go or no go and what the concerns are.”

“this actually had a compounding effect in that, there's a lot of positions on Aave because they rehypothecate the ETH collateral quite heavily. This liquidity issue now turns into a solvency issue on the USD markets potentially. So that the there's a lot of positions there that are ETH collateral borrowing stable coins. And so, normally, when the market is is there's there's enough liquidity, the liquidations on a ETH USD position can function just fine. The problem is is that with an impairment in the ETH market, if the price of ETH drops, there's no more liquidity to sell and then recap like, recapitalize or basically pay off the loans that are reaching margin calls.”

“We have to ask ourselves if we should start thinking more carefully about constraints. I think one thing that we conflate a lot in crypto is decentralization and permissionlessness, because they're not the same thing. Even just talking about permissionlessness, people usually assume you mean KYC, but a protocol can restrict what kinds of assets or collateral it will allow, or it can impose rate limits. If we even want to survive as an industry and a technology, we need to really seriously think about the trade-offs between crypto's core values and keeping users safe.”

“We were able to use that same tactic and actually and and because if we wanted to give ourselves new rules or upgrade the the software of the Nord, we could do that... we can actually make a transaction on Ethereum. We have to wait fifteen minutes, and, and since the hacker wasn't able to move their funds in that fifteen minutes, that transaction went in, and it actually was able to send their funds from the the address they control to, an address that no one controls.”

“And you have, like, the Cominos and the Morphos of the world who maybe started with a more, isolated markets or, modular approach to lending as opposed to, the more, you know, structured product of of a core. And there are trade offs to both. Right?”

“you can do, DeFi custody in the right way, and it's been actually, some of the oldest protocols have been doing this the right way, which is, governance under time locks. And where there are multisigs that have, like, custody of funds, they need to be under time locks. And then for immediate reaction time, you have these, like, freezing multisigs that can react right away, but you need this, like, the custodian of the assets to always like, any sort of, like, unexpected movement that can be done with the assets, you need this under a time lock. This is a this is a massive, deterrence, to North Korea.”

“The tough part there is they're not, you know, RIAs or whatever else. They don't have the extra level of accreditation, you know, that you maybe might want as a user in future. Like, when you have companies like Bitwise come into the bulk curation space.”

“I think for a while, the last few years, the industry has optimized for scalability and speed and whereas in the early days of blockchain, we really optimized for security. And I think that pendulum is swinging back. Now we know that we can have fast chains. I think we now need to work out how we have secure chains.”

“One of those core national interests is re-establishing deterrence by denial on the first island chain in the Indo-Pacific, in order for us to have, you know, basically hopefully a credible conversation with China that's backed up by the appropriate, you know, use of force if we need to use it, you know, to basically make the Taiwan scenario for the Chinese so unpalatable that they won't want to go.”

“China has excess capacity in solar panels and also makes pretty good batteries that are fairly cheap. Maybe we can think about creatively what China could bring to the table in terms of solving some of those issues and what the governance strategies would be for extracting some kind of learning out of that investment if it were to come.”

“The Lazarus Group, deposited, 228 or or sorry, $270,000,000, worth of, this wrapped, restaked ETH onto the Aave protocol. They get to withdraw $228,000,000 of, wrapped ETH. And now all of a sudden, you have a bunch of bad debt because there's a bunch of, tokens that don't actually exist that have been deposited and a bunch of real money that does exist, which has been taken out by a bad actor.”

“After this was actually withdrawn, and it started getting moved by, what we later discovered was the Lazarus Group, all of those tokens then moved onto, Thorchain or at least a significant portion of it once it was actually, taken out from from AVE. It was then taken and sort of, laundered, using Thorchain. And so when you get very large Thorchain deposits like that, it's very typical that these are, proceeds of a crime.”

“There was a statement that we were going to be disinvesting in this region and reinvesting more in this region. But essentially, there was very little in terms of specifics about where and how we were actually going to disinvest in order to focus on the regions that really matter to us.”

“Arbitrum took what I or off chain labs, I think, took what I thought was a great move, which was they froze about, you know, between around $65,000,000 worth of these stolen assets. But I see some people saying that, well, this is MultisigFi instead of DeFi, and we kinda to me, I interpret this as this is the ideological backbone of crypto colliding with the real world. Well, I think, you know, North Korea not having $65,000,000 in that money going back to users, like, the outcome is unambiguously good.”

“North Korea is actually playing a really big part of this story. So Lazarus Group obtained about $2,000,000,000, in hack proceeds last year from DeFi and crypto. That is a non trivial amount, and the exploits here are getting far, far more sophisticated. So a part of this story is we could be doing better in terms of multisigs. Like, at least on the Kelp DAO side of things, there was a layer zero DBN, which was operated by them, and it was one of one, which was a central point of failure.”

“I think most people want a very sure 10 to 15% return. That's what I think that's what I think, like, most people are chasing. That's where I think the biggest amount of money in the world is. Have you guys spent a lot of time on, like, the Reddit forums of, like, financial freedom? I actually disagree with you. I don't think we are clouded by crypto that retail wants thousand x's.”

“His name is Gannon Ken Van Dyke, and he allegedly made more than 400 k trading on Polymarket on the basis of classified info regarding the timing of The US military operation to capture Venezuelan president Nicolas Maduro. He tried to cover his tracks after making the bets by sending most of the gains to a foreign crypto account, and he even asked Polymarket to delete his account. He's 38 years old, and he was stationed at Fort Bragg in North Carolina.”

“Part of the challenge has been that Americans have become so, I think, understandably cynical about the ability of government and politics to produce real change that they see it now just as an area for culture war. That has been a problem specifically in foreign policy as well.”

“Micro strategies, STRC or stretch instrument as they call it is the most traded, most liquid and largest preferred stock ever in history. Preferred stocks are kind of a somewhat niche area of the market. But interestingly, and many people don't know this, stretch's IPO was actually the largest IPO of 2025, full stop. Larger than circle, larger than any other asset IPO. It has really been catching on now.”

“Proof of work, scaling on Ethereum, it's worked well enough that it still costs less than one cent to send any amount of USDT in normal gas times. So if I can spend less than one cent in gas fees to send any amount of value on Ethereum, what's the purpose of something like Arbitrum in the first place that offers decentralized scaling for Ethereum? It's like, no, either use the full corporate chain tempo or use Ethereum mainnet. I don't really see the reason for having Arbitrum anymore.”

“Well, I think one of the major design principles is effectively to segregate the base layer or the validator network that's actually witnessing transactions on those source chains and then attesting them into the blockchain. And then basically making a general abstraction, which we call subnets that allow multiple different, you can call them subnets or layer twos or whatever. But you can basically have like the base network, which is only responsible for custodying the L1 assets. And then those are being credited to networks that can have their own validators set. Our first subnet is our exchange, which is a limit order book.”

“The real discourse and the reason why the dollar sucks so much and the reason why you have such hyper bias between political parties on a middle class and lower class level is because they're printing your dollar at an exponential rate, and you're losing buying power. So in 2022 when you bought a $600,000 house. Your interest rate made it so that it was a $2,000 payment. Now that same house is appreciated on average up to about $800,000, and your mortgage payment is now $5,000. So people are getting hurt. Their quality of life is diminishing if they're not outpacing this inflationary uptick.”

“A DeFi cascade could be the linchpin that causes that final capitulation candle. And just to back up to what I said yesterday, that final capitulation from FTX was about a 25% candle to the downside in a singular week. And if we keep cooking, and it looks like we got some juice to keep cooking, I actually think that we're gonna be tapping around the 80, maybe $81,000 range, and a 25% move brings you smack dab back down to $60,000, creating a double bottom party time back on.”

“Mark Carney's comments, I guess, in in reaction to to Trump's posturing towards Canada specifically. And if you're thinking, like, deep state actors placing Mark Carney in the prime minister role of Canada seems to be very strategic for for the incumbent power structure. If you know the history of Mark Carney at the Bank of England and HSBC and his involvement in the the cartel the cartel money laundering case with the HSBC where they're putting, duffel or, excuse me, briefcases full of cash through teller windows. They designed the teller window. He's he's had his fingers in everything. Many would consider him a a Davos class economic actor.”

“The thing that really first just, like, tipped tipped me off to it was last summer with the MP Materials deal for, you know, an equities massive equity stake in MP Materials and other rarest brews here in The US with offtake agreements as well and price floors, which is very industrial policy, very, you know, World War two preparation style, unfortunately, kind of central planning flavor in a policy. Well, you're seeing that here, as well with this deal. And so a major financing package for the deal from the Development Finance Corporation, which is, government Pentagon aligned, as well as a a long term fifteen year, 100% off take agreement with with price floors largely, it looks like, subsidized by and guaranteed by the government.”

“Aave as evidenced by the launch of v four, is what is the model of lending here? And you have, like, the Cominos and the Morphos of the world who maybe started with a more, isolated markets or, modular approach to lending as opposed to, the more, you know, structured product of of a core. And there are trade offs to both. Right? But I think that's also something that people are thinking about here too. Yeah. Definitely. And, Mike, I know you spent a bit of time in this space, but I also think it's worth pointing out, you know, Aave, you mentioned the asset itself is was the thing that created risk.”

“People right now are actually utilizing Arca monitoring these contracts on these, different platforms such as Aave, in order to then withdraw as soon as they receive an alert on chain that somebody's looking to deposit or has deposited... If you wanna mechanistically try to get your money out, you set an alert for any time a single dollar comes into the protocol so that you can be first in line to try to withdraw it.”

“I think the the clarity and genius stuff is, like, you should fade it. I mean, the regulation is always a fade in terms of what's driving price movement 100% of the time. But I think that peep it I think it's the type of thing that people fail to price appropriately the long term effect of. Like, Genius got signed into effect, and then there are a bunch of things that are in motion right now which are going to drive, like, a whole bunch of changes that there will be big winners from.”

“You're absolutely correct that the fiscal deficits seem to be stuck at between 5 and 6 percent of GDP. You and I early in our career spent time at Treasury, and in our day, that would have been a real eye-popping number in an economic expansion. Basically, anything over two or three is something you would get focused on.”

“We were able to use that same tactic and actually and and because if we wanted to give ourselves new rules or upgrade the the software of the Nord, we could do that... we can actually make a transaction on Ethereum. We have to wait fifteen minutes, and, and since the hacker wasn't able to move their funds in that fifteen minutes, that transaction went in, and it actually was able to send their funds from the the address they control to, an address that no one controls.”

“I attribute most of that to higher-term premium that bond markets require to hold sovereign bonds. During my time at the Treasury, even before the pandemic, when the Pal FED was hiking rates, I think 10-year Treasury yields peaked at around 3 percent, and they're now running, of course, in the mid-4s, and indeed, they've been averaging, I think, four and a quarter for the last several years.”

“In, you know, public company investing and Bitcoin's not public company, but public company investing, one of the key hallmarks of a CEO and a management team you wanna avoid is when they're overly focused on short term gyrations in stock price. Like, they just gotta get stock price up, and they're really freaked out when the stock price goes down one quarter, when the market misunderstands a quarter and sells sells the stock on earnings or something. And I see a lot of that in the conversation about Quantum, both from the institutional side, but also from some technical people as well. I would just encourage people to fade that type of thinking because that is a great way to optimize for decisions that will not help and will not drive value and will not drive stability and sustainability in the long term for any system.”

“DeFi and just the whole crypto industry, it is kinda playing on hard mode because, we can't rely on just, like, moral hazard and someone bailing us out. If anything, like, maybe the closest, we have in crypto to, like, a lender of last resort would be someone like a Binance or a Tether, where they're extremely profitable. They have a huge balance sheet. They have a lot of sort of excess reserves where, they can backstop, losses. You know, private got hacked. Binance, had a loan out to them to make sure that they could still cover withdrawals.”

“Jones was, actually, this is a really interesting point, Scott. He wanted 35% market decline could hit capital gains tax revenue, widening the federal deficit and pressure of the bond market. So that's kind of a nightmare loop as stocks fall, tax receipts weaken, the deficit looks worse, bonds get hit, and investors are forced to sell more than what they own. And he also cited some of the big IPOs. He said that a flood of new share supply from companies expecting to go public combined with insider lockup expirations could create pressure similar to the setup before the dot com bust.”

“AI is a great tool, but it's an arms race, right? It can be used by the good guys and the bad guys. I do think teams need to be using it much more than they could auditing end-to-end, absolutely everything, using AI, and getting their hands on the best possible tools. I think you see a lot of security firms are working to bring these tools out now, and increasingly teams are using this, but it's also in the hands of the bad guys, and they're very, very effective operators.”

“the 50year-old teacher in Iowa who just wants to do more with his grandchildren or whatever. He's not on Twitter. He's not going to go on a out of his own impetus. And most likely he's also not going to get reached with the marketing the classical the platforms are doing at the moment but he's going to most likely watch one of the biggest sports events of the year and when he's then learning about it he's like oh wow there is real science behind and that's why our clinical study we're doing in Abu Dhabi beyond that it's like gold standard for the uh for the athletes what they're getting in terms of uh medical service I think it's very important that be very scientific and everything we're going to do in the future and everything we're going to recommend uh is going to be backed up by science and with that sort of combination approach of like this massive global sports event which going to reach again hopefully millions and millions of people.”

“Historically, in order to reduce core inflation by multiple percentage points, you need a deep recession. I believe there are some very prominent economists who said to get inflation down to the 2s, you’re going to need 6% unemployment. And of course, through the end of 2024, that had not happened. Inflation had fallen, I think it bottomed at 2.4%.”

“If we're saying it's nation state actors with their tremendous resources against individual protocols, the protocols will lose with certainty. However, you can still flip that security framework on its head if we make it a chain of things that have to fail with a redundant response across the ecosystem. Because the Lazarus Group, breaking a single protocol is relatively easy, but breaking eight protocols simultaneously, all of which work differently, becomes so complex.”

“The risk was not that Aave had a, you know, a bad multisig or Oracle configuration or anything like that, but, another type of risk, which is the type of collateral that's been onboarded into one mixed pool, it caused these knock on effects. And you're you're essentially looking at a bunch of people right now. This is sort of without precedent. You know, I I I don't think in any of these, maybe, analogs that you could point to and TradFi, you've seen something like this, which is one, everything is a 100% transparent, and you have some folks who are locked a little bit or unable to, you know, unable to to move stuff on the wrapped east side of things.”

“I thought it was really funny in past cycles, especially, like, '21 where, when the institution institutional people, like, tried to basically, like, adopt crypto culture, you know, and you'd have, like like, you know, consulting firms being, like, g m g m. Like, we'd love to chat to you about x y z or just, like, random people at these big companies having, like, you know, board ape PFTs and things like that. And it was very much so, like, we're in our own little world over here.”

“We had the KelpDAO hack, which then led to a problem with toxic debt across all of DeFi, which led to an issue specifically on Aave, which is obviously considered the blue chip safest DeFi of, I I think, roughly 200,000,000. And we have sort of a JPMorgan early nineteen hundred situation where it gets everybody in a room and asks for a private bailout. So we have, I guess, a mix of different companies either sort of donating, I mean, Steny himself, I think, millions of dollars, or offering loans, but basically plugging up this whole I think it's $300,000,000 already has been pledged. This reeks, I think, on the surface of tarp, you know, a government bailout like 2008, but I think that's sort of a lazy comparison because it's voluntary and it's not forced and it's not the government.”

“I think accountability is really important and we can't have that unless we're allowed to ask questions. And so we shouldn't be silencing each other every time something like this happens. What about the victims, right? They deserve to know what happened and why and what these teams are going to do about it, what the industry is going to do about it to make sure that it doesn't happen again. We can't just give thoughts and prayers; we need to improve things and ensure accountability for those who lose funds.”

“I still think that the models flatten to a commodity over the long run and just that the harness, how the harnesses are really good and that Anthropic has a ton, or OpenAI has a ton of compute power. But I don't see it being, I see it being likely that people will be able to use open-source models to devise the same caliber of attacks as we're seeing today. So I really don't see certain nation states having an advantage over others that are purely due to model dominance or even compute.”

“I think someone resurfaced a tweet from Carl Samani this week about him saying that, you know, security doesn't matter. Like, all all that matters is speed. I think for a while, the last few years, the industry has optimized for scalability and speed and whereas in the early days of blockchain, we really optimized for security. And I think that pendulum is swinging back. Now we know that we can have fast chains. I think we now need to work out how we have secure chains, including smart contracts, and that, of course, is under the same umbrella as DeFi.”

“One thing Mike said, which I agree with is, like, you know, meme coins and n f NFTs, etcetera, I'm not sure these things will come back. But there will be a new thing that people use, especially retail that we don't even know about right now, and that just absolutely blows up.”

“This is a core tenant of blockchain technology that we just don't talk about. Blockchain technology is open, modifiable. It's it's it's, it's just code, right, running on servers and social consensus. And that social consensus piece is the thing that destroys the idea of immutability. It destroys the idea of, like, you know, complete, agency. I mean, it is it does have agency, but it's like, it can be persuaded.”

“One is there's been a 40% increase since 2024 in the extent to which the American public has friendly, a sort of friendly disposition towards China. It's now at around 53%. I mean, this is an extraordinary figure.”

“Taking this open European vocal, European stance against Trump, I think the Sánchez government hopes that it could mobilize domestic support for this government, and this could mobilize support for the incoming election. We are still having local elections, regional elections in Andalusia next month, which is the most populated region in Spain. We are having general election next year. Also, the fact that Trump is creating this domestic opportunity for Sánchez, and he is also taking advantage of that.”

“Look. It you know, your instinct is right. I think everyone should be off the screens, frankly, as much as they can. It's increasingly low low return on time and increasingly a a a dos attack on, your attention to really follow the headlines closely. So, it's it's Michael Scott, snap, snap, snap, snap basically every day of the week. And so I think this is just a great illustration of how little the average market participant knows or can really rely on anything that they're seeing come across their their Bloomberg or or CNBC on any given day.”

“The belief that transactions are, call it optimistically correct, has to be discarded in this environment. You're clearly getting enough hacks that all large transactions should probably be viewed with some degree of skepticism. And I don't know if that means delays with drawing for protocols, choke points on bridges, needing significantly larger shares of votes to move assets.”

“How can you get in front of these agents? And, like, potentially, there's a lot of value to be captured there in terms of owning that distribution channel. And so they're not really like money Lagos anymore. It's just more like a back end as opposed to, like, composable primitives that developers use in their own smart contracts. So I think the Lego sort of conversation is changing more to, like, a direct to smart contract back end kind of conversation. Like, do you need to compose anymore? Yeah. Maybe maybe you do.”

“So I think the story in the US in 2025, to some extent, was tariffs pushing up the price of goods. And that was offset by a decline in services inflation. And then, of course, in 2026, we have a sharp increase in global energy, oil and natural gas prices due to the hostilities in the Middle East and the closure of the Strait of Hormuz.”

“Where is the term medicine coming from? Where's the term doctor coming from? It comes from a report which was commissioned in the 1920s by the US government. Uh which was great back then because before there was no definition. Everybody could sell this whole thing and like yeah. So that report said hey if you want to call yourself a doctor you need to have a minimum of a dedication. if uh they call the disease a negative deviation from the norm uh and then a medication which has a minim minimum efficacy yeah and where you know kind of what are the side effects in order to bring back the negative deviation of the norm to the norm by the way back then I don't want to criticize it groundbreaking because it improved the medical system it's actually what the western medical system is built on but like the tricky thing was that negative deviation from the norm it's very obvious for cancer.”

“The Ninth Circuit heard this, and the other interesting thing is all three judges on this three-judge panel were actually appointed by Trump, but they sounded openly skeptical of the CFTC's federal preemption argument. If we have the Ninth Circuit rule against the prediction markets, and another circuit rule for them, that makes it way more likely that the Supreme Court is going to take on this issue. We’re likely looking at a 2027 or 2028 timeline before we have a final answer on whether these are considered gambling or legal contracts.”

“I would just say that if you look at the composition of deposits and lending activity on these borrow lend protocols, people are interested in RWAs much more so than crypto native assets. I think it's pretty clear that the driver of the let the next cycle or at least a big part of the story is gonna be different types of actual real world assets and people using it, like, RWA looping, this broader, trend. Shout out three f, small but proud bag holder there. But, yeah, I think that that's gonna be a big part of the story.”

“The international order is crumbling into disarray, she said, adding that both China and Spain are nations of principle and integrity, and should cooperate closely to resist any regression toward the law of the jungle. Later, Sánchez met with NPC Standing Committee Chairman Zhao Leji and Premier Li Qiang, and a set of 13, I've also heard 15 bilateral agreements were signed on education, technology, sports, and cultural exchange.”

“Nobody is more confused than America's allies about what the United States wants. And this is especially the case when it comes to China. I've sat in a lot of meetings recently where Europeans have said, what does the United States expect of us in our relationship with China?”

“I think it's pretty clear that the driver of the let the next cycle or at least a big part of the story is gonna be different types of actual real world assets and people using it, like, RWA looping, this broader, trend. Shout out three f, small but proud bag holder there.”

“No, I think Christian uh you're making a good point that I think the underlying thesis is right, how can we showcase the efficacy and effectiveness of enhancements when they are administered under the right clinical and medical supervision. And so there is, as Christian alluded to, right, there's athletes that can break world records, but that's extremely unrelatable, right? There's very very few people, one right, that can hold a world record. And so we have a second category of athletes like Megan who's 35 coming to beat her personal best. But then still how can you make it even more relatable? And so everything on the sporting side then if you take a step back and look at as an overall organization everything that we do on the sporting side is the showcasing of the efficacy and effectiveness of those enhancements to go out there and inspire people to think about their own health differently and consider what can enhancements do for me.”

“Bitcoin screamed up to 78,000 on the seventeenth, so last Friday. And it's it's held up pretty well throughout all this. you had Bitcoin on the one month chart really diverging from the software stocks index from from Vanguard, I think. There was some sharp divergence. Bitcoin up 6%. Software stocks down about a percent, and they've been trading in tandem since the middle of last year.”

“It is true that Spain has some comparative advantages when it comes for promoting cooperation with Latin America, because the Spanish diplomatic service, Spanish companies, Spanish academia, we all have very intense networks there. We have a lot of knowledge of what's going on on the ground there. And so it's just natural that, for example, Chinese Ministry of Foreign Affairs and the Spanish Ministry of Foreign Affairs has a dialogue. They have concluencies on Latin America regularly. They talk about these things because they have a common interest there.”

“I'm actually quite I'm surprisingly bullish on real world assets. I think that that would definitely be a thing this cycle. I spend less time there. I'm actually a bit concerned about the risks of real world assets. I wrote a master thesis on DeFi risks back in, like, 2019, and I think real world assets for me right now are, like, highly, highly risky and, like, massive chance of blowing up when the cycle comes back.”

“I do agree that the default setup that's out of the box for people to use is probably not great, and I think it's something like 40 percent of people do tend to use that setup. So they're saying it's mainly the fault of KelpDow for not modifying that and going further. But I think there's some truth in that. Obviously, there's 60 percent of people, including Euler and all these other projects, that decided to use more DVNs.”

“If we prioritize the Indo-Pacific and deterrence in the Indo-Pacific, even if we're going to come at it as the NDS uses the language of not wanting to humiliate China, not wanting to dominate China, but instead back up our position and our interests in the regions with a credible deterrence, that's going to take a hefty amount of resourcing and that's going to mean that we're going to need our allies and other theaters in particular to take on more of the burden.”

“Look. It's preferred, man. It's preferred over MSCR. I get 75% loan to value on my on MSTR. I went to my bank and I said, hey. I want you to move my treasury position or at least half of it into STR in into STRC. You're giving me 3% on the bonds. I get 11 and a half on the fucking, STRC. They did it the next day, dude. Risk management had never seen that trade.”

“If if your view is Trump has the chicken out, this is he's he's sensitive about stock market. He's sensitive about treasury yields, all these different things. Well, maybe. That may be true. But if that's the case and that's his primary Achilles' heel and primary constraint, even after he sent 10 destroyers, 12 destroyers, whatever, into into the Persian Gulf to turn away dozens of ships and kinda imperially take control thus far of of that area and stocks are all time highs. So if your entire bed, if your entire philosophy, if your entire worldview is it's, you know, it's just a matter of time before The US has to pull back because Trump's so worried about the the stock market, well, you know, he's he's got a lot of leeway right now.”

“To get to the question, what the United States wants, the United States does not know what it wants. We're in a moment right now where to state the obvious, the old consensus has come apart. I think that memo first landed with Trump's election in 2016.”

“I think a lot of people were caught off guard by the fact that, like, you know, Aave, which is kind of like a core pillar of the the industry, through this smaller relatively collateral RSEs, they've had exposure to, you know, what turned out to be a pretty unsafe, like, bridging setup. And it's pretty challenging to, like, map out this whole dependency graph of, you know, you're just a depositor in Aave Eth. It's you you know, on the face of it, it seems like it should be a very safe asset, but you're actually exposed, you know, through a couple layers of intermediation to, you know, a one of one DDN bridge.”

“The second this hack happened, behind the scenes, they're coordinating with law enforcement. They're coordinating with all the bridges, all the all the people that they could. They're blocking UIs, this address from UIs. They're putting this address on all these lists. And, like, the infrastructure of c o nine one one is really the hero here. Like, I feel like the security council is getting a lot of credit for executing, but the the real execution happened to layer up, and it's c o nine one one.”

“It's just tough to get keep getting kicked while you're down, Scott. Like, we're we're down 90% on anything else that we've bought that's not Bitcoin. Right? Like, some people down more. Things have been lost. Like, retail's just got barely like, almost no heartbeat left. And then the little bit of ETH maybe that you, you know, that that someone had trying to earn a little bit of yield, you know, hoping to get a little bit more capital for the next run.”

“Amex answered the three hardest questions in agentic commerce: identity, mandate, and accountability. When the agent screws up, who pays? This is the one that matters most, and crypto has obviously not figured it out. Amex says we will pay if you use our rails and the agent screws up. That is what is going to unlock adoption for agentic commerce—the liability and the accountability—especially because the laws in this space are so uncertain and current laws are built for humans swiping cards rather than AI agents.”

“I think Bitcoin's totally fine. I do though think that they will burn those coins or freeze them or do something. They're not gonna let a $100,000,000,000 of Bitcoin get burned. But what I think the sorry, using another analogy here, but the other analogy of an ideological movement doing this is like the church, which everyone loves to compare Bitcoin to. I think it'll be fine. I mean, the church kinda went through this when they had to reconcile with the Roman emperor and, like, you and I wouldn't care about this, but in Christianity, you can only worship one god. Roman emperors were version like, worshiped as gods. How do you reconcile?”

“Tokens are not an asset class. They are a way of they are they are a wrapper for different types of asset classes, period. Like, a token is not a new thing. It's not a new thing. It's just a different way of representing existing assets.”

“We need to build better infrastructure and not have one of one DVNs that are governing, you know, the ability to move value that quickly. And then, you know, aside from that, like how do we eliminate the blast radius on other DeFi protocols like Aave? Aave should not be accepting deposits that are that large from brand new addresses without those being flagged. If we're feeling downtrodden right now because we're really facing the music of DeFi in general potentially being at risk here, to me it's just a wake up call that we need to double down on our efforts on securing this infrastructure.”

“when you look at the research that's been done on an anonymized basis, it roughly half of Olympian athletes admit to using banned substances and only 1% gets caught. So you ask yourself why is that the case? The reason for that is because athletes when they choose to cheat, they take newly developed drugs that are not well researched. They take additional drugs on top of that to hide what they're taking in the first place. That's how they're able to circumvent the testing. And that is completely unnecessary. Because it puts their health massively at risk. And why is that unnecessary? Because all of the substances that would make you perform better, recover quicker, and protect yourself better from injuries are actually substances that are FDA regulated and can be prescribed and are being prescribed by doctors to other patients every single day. And so we're saying, let's not be naive, pretend that the cheating is not happening. Let's take it out of the shadows.”

“AI in general, you know, North Korea, I don't know, you know, I have no idea what their operation is like. But, like, assume there's some number of humans that are incredibly intelligent that are, like, working through and doing these hacks. But, you know, humans are, you know, I did security and and, you know, university and stuff. It's incredibly, like, taxing on human minds to kind of go through binary and stuff. It's it's it's super hard. Computers, AI are are are very good at this. So, like, for me, like, you know, I I just think it's there's certain number of human beings that are are doing this are now being leveraged, like, probably 10 x.”

“If you have a large portion of the ecosystem, in this case, all of Layer 0's users, if you have something like 47% of them going with this one-of-one verifier setup, it starts to look less like an individualized choice, and more like actually standard architecture, or even the industry norm. I think what courts will eventually have to wrestle with is, when is it not enough to say, oh, we just provided the options, or we provided the tools? Defaults matter, and the options you give actually shape user behavior.”

“We want to enable value to be communicated as quickly as possible, but like any time when it is about to leave the boundary, you want to just like spend a little bit extra time because it's important that our orders match at sub microsecond in like HFT, but it's not important that the actual funds settle between institutions and TradFi in sub microsecond, right? That takes longer. It takes hours, if not days. There's reasons for that. There's circuit breakers. There's people on both sides checking. There's middle offices like everything that TradFi has built in terms of circuit breakers. We're just speed running, relearning those things in crypto.”

“He was very emphatic about it, pointed out quite a few reasons why he believes that the stock market is once again near a top. Now he's been saying that for quite a while. But mostly that US equity market cap is 252% of GDP right now. Dotcom peak was 02/1970. You know, previous crashes were far, far less.”

“Jerome Powell's in the news. US Department of Justice have now dropped its criminal probe of Fed Chair Powell. This is something I'm actually in favor of. I'm not the biggest fan of Jerome Powell, but to assume Jerome Powell's gonna know if a contractor's ripping him off on plumbing seemed a little far fetched to me. I don't think he was in charge of the the management of the construction of a building. I think he was more concerned about policy decisions, not construction decisions.”

“This sort of this is leaning on the authority of NIST or the perceived authority of NIST. Everybody is pointing at NIST and saying, well, NIST is saying that, and NIST is doing this, and we need to do what NIST is saying. I think it's, again, tone deaf and naive because Bitcoin Satoshi picked LibSec p two two fifty six k one, that cryptographic library, because he looked at a lot of the NIST approved and recommended cryptographic signature schemes and found that a lot of them had embedded constants, which ultimately led to backdoors.”

“This is good because you have the infrastructure there, you have the knowledge there, people there, and now you have again another foreign car company that is willing to invest there and put this back to motion, back to track, so this is good. This is great. This is very welcome, but again, the levels in the details because the actual economic impact for the Spanish society is very different, whether you localize or not, for example, your value change, whether you employ or not local labor force, so this is significant.”

“People right now are actually utilizing Arca monitoring these contracts on these, different platforms such as Aave, in order to then withdraw as soon as they receive an alert on chain that somebody's looking to deposit or has deposited... If you wanna mechanistically try to get your money out, you set an alert for any time a single dollar comes into the protocol so that you can be first in line to try to withdraw it.”

“You know, I think it's it's worth asking, you know, if we map ourselves to to Rome as many people often do, are we entering the decline of the republic stage or the decline of the empire stage? Because those are very different phases of the history of that great power and have a lot of great powers that follow similar cycles. And, you know, a lot of people are ready to to stick a fork in in The US, but they maybe should be sticking a fork in The US Republic, not The US Empire.”

“It's not even about smart contract exploits anymore; you can have a million audits and that wasn't the cause of any of these recent attacks. Now it's about all the dependencies around oracles and bridges and collateral and multi-sig configurations or operational security practices. It sort of feels like you're just playing whack-a-mole. North Korea and other illicit actors are just going to keep coming up with new ways, probably greatly aided by AI, to exploit vulnerabilities in the systems surrounding the core code.”

“After this was actually withdrawn, and it started getting moved by, what we later discovered was the Lazarus Group, all of those tokens then moved onto, Thorchain or at least a significant portion of it once it was actually, taken out from from AVE. It was then taken and sort of, laundered, using Thorchain. And so when you get very large Thorchain deposits like that, it's very typical that these are, proceeds of a crime.”

“I think we can characterize this strategy mainly by two things. One is pragmatism. He's been very, very pragmatic in his approach to China. He avoids this kind of idealistic or wishful thinking narratives about China, the global order. He thinks that China is a highly successful and powerful authoritarian system with a model of state capitalism. This creates clear challenges, of course, the US was talking about that, but it also generates significant opportunities. Not only in socioeconomic terms, but also when we talk about addressing the main challenges for the international community. It's like climate change, governance and proliferations.”