MONITOR DEFI

“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.”

“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.”

“Van Dyke profited 400K by trading various outcomes related to Venezuela after learning of the operation because of his role as a US. Army soldier. The FBI will continue to investigate threats to our nation's security, especially from those entrusted to safeguard sensitive classified information and military operations.”

“There is significant institutional pressure for Bitcoin to achieve quantum resistance by 2029, which is starting to echo the intensity of the 2016 block size wars. We're seeing a push toward NIST standards, but there is deep skepticism within the community about whether those standards are truly secure or if they represent a Trojan horse for government agencies to maintain backdoors into the protocol.”

“I was talking to everyone at BrainPoint that this is going to be really good and big in Solana. Because we always wanted this and we finally have it. And I think although we live in this permissionless 24-7 world, it's still fine and some people still lose money and things break.”

“I think 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 12 months before activity started recovering. That kind of 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.”

“For the average person in Guatemala, Venezuela, Zimbabwe, they're not really thinking about who's going to freeze my tether, right? They're thinking about, I don't want my government to have access to my bank account, and I don't understand these other assets that are not dollars. They're way too volatile. And other people have gotten scammed. So this USDT thing seems pretty safe. Everybody uses it. And I think the excitement in the Western world is because they are seeing stable coins as a way of basically vampire attacking the Euro dollar market.”

“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%.”

“What we observed with Prime is when you have something that is sustainable and that scale, it takes a bit of time, but people start trusting it and then they realize they can do useful things. People with that want to earn yield, they can rely on it. So this was always the promise of defy composable money, but there were no pieces to compose with.”

“Unless the Department of Justice plans are going after all the crooks in Congress currently inside of trading, this is simply skewed justice. There is no justice when guys like this get the book thrown at them, yet members are illegally profiting every day.”

“The challenge, and I think what investors realized during this exploit, is that DeFi has no bankruptcy rails. There's no court. There's no recovery. Everybody that got out of Aave first took the full money out. Everybody that's still at Aave is waiting to see how much of the losses are going to get pinned to them. And so if you're an institutional investor and you can estimate the potential of a loss, but you cannot estimate how those losses are going to be attributed, you cannot determine your exposure.”

“Iran shot down those two planes over southwestern Iran. That's near the Strait of Hormuz, the waterway controlled by Iran through which much of the world's oil supply passes, fighting there has led to really a spike in energy prices. These are the first US planes downed in this war, and it could mark a turning point.”

“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.”

“We just survived the worst Q1 in Bitcoin since 2018. Down 24% in Q1. And that was the worst Q1 we've ever had since 2018. In 2018, the market topped December 2017, and then it fell like 60% in Q1 2018.”

“Hundreds of TSA workers resigned during the recent pay disruption, and experts say it can take months to hire and train replacements. That means staffing levels can vary by airport and even by the time of day, creating unpredictable wait times for travelers.”

“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.”

“Bitcoin is finally starting to diverge from software stocks after months of a very tight correlation that made it look like just another tech trade. This decoupling is a critical signal that Bitcoin is showing resilience against a backdrop of great power competition and is being re-evaluated for its unique strategic properties rather than its sensitivity to interest rates or equity market volatility.”

“What history repeats itself or at least rhymes should look like is we'll have some juice to the upside on the money flow and then have that final move down on momentum and then start to come back up... I think a DeFi cascade could be the linchpin that causes that final capitulation candle.”

“The CFTC's recent prediction markets guidance is a 'nothingburger'.”

“The protocol is built with institutions in mind, highlighting for one that it does not trigger a tax event like alternatives and also comes with low-premium on-chain Bitcoin denominated insurance.”

“I think the price, who is driving price discovery? It's the boomers here. There's a bunch of boomer money via now ETFs, but soon RIAs and stuff like that, that's going to move into crypto. They're going to go through the same process that we did, and they're going to look at the world and say like, what makes sense here at DeFi?”

“The CFTC's recent prediction markets guidance is a 'nothingburger'.”

“Even to get to the point where the Kelp DAO was even used, that was used largely by recursive looping and yield strategies. These weren't necessarily people taking out loans to do real things in the world. They were just trying to juice their yield. And that is another problem in DeFi. There's so much on-chain rehypothecation, you don't really know what's real. And I expect as the Aave liquidations and losses get attributed and more capital is allowed to exit, you're going to continue to see knock-on effects.”

“In general, the game is getting harder every cycle. You can't just like, even the last one, the last one was pretty narrow, right? Like it wasn't just throw a dart at the board and like all of the coins basically go up. And I think that will persist, right? It's going to be much more narrow, thesis driven. And then even probably like the weird stuff will also be quite narrow and like just come out of PVP communities.”

“You want to do it well, you want to inform people about the token, what does it do, what are the risks, what is the yield coming from, be as transparent as possible, try to curate as much as possible. Because that's how you build a user base that appreciates those things, that invites other people, trusts you, etc.”

“Crypto is splitting into the worlds of world of, just like stocks, like blue chip stocks that are traded on exchanges and penny stocks. Crypto has been entirely penny stocks. That game is going to continue to exist, but it is going to get dwarfed by the blue chip, you know, exchange traded stock game, which competes on compounding and all of the stuff that you would be relatively familiar with.”

“The Prime Minister warned of extremely difficult times ahead as the Iran war continues to affect oil costs, noting that current prices are almost double the estimates indicated in Senegal's current budget. Several African countries have put in place measures to try and mitigate the impact of increased oil prices, including reducing fuel taxes and increasing subsidies.”

“We are on track to complete all of America's objectives very shortly. We are going to hit Iran extremely hard in the next two to three weeks. We are going to bring them back to the Stone Age where they belong. I think the whole 19 minutes was basically to inform the public that we are in this for three more weeks.”

“The Admiral, who went on the floor of Congress and said that Bitcoin is a national security tool, that the United States military is running a Bitcoin node, monitoring the situation, so to speak, and that it's not a matter of holding the asset or investing in the asset, but that they're looking at it for a way to secure networks and use proof of work. I thought that was just an astounding, astounding clip.”

“The protocol is built with institutions in mind, highlighting for one that it does not trigger a tax event like alternatives and also comes with low-premium on-chain Bitcoin denominated insurance.”

“We've now been in this range for 78 days, trapped in this hellscape of, I don't want to say boring price action, because there is a decent amount of difference here. I mean, you're looking at a $12,000 swing. If you're on 47X leverage, this range is very, very exciting.”

“When we identified a user trading on classified government info, we referred the matter to the DOJ and cooperated with their investigation. PolyMarket snitched on him. They have a data partnership with the Dow Jones, also kind of connected to the Wall Street Journal.”

“President Trump's new proposed 2027 budget is calling for more passenger screening at airports to be done by private companies instead of TSA agents, as is the case now. Supporters of the idea say it would ensure screeners continue to get paid during a government shutdown and the White House says it will save the federal government money and that privately operated screeners are more efficient.”

“The interesting thing though is with AI, everything can be spoofed, everything can be faked. So everybody's looking at how do you prove that something is AI? And what's interesting is proof of work actually puts a value behind data. So there is a way of using SHA-256 and old miners to put value on content. And therefore, it's just not like one-off cheap. It's the equivalent of if it costs you a million dollars every time to send an email, then you're not going to get any spam.”

“The Sierra Verde acquisition and the partnership with Indonesia highlight a massive push for a new industrial policy regarding rare earths and critical minerals. This is a clear move by the United States to gain leverage over China's long-standing supply chain dominance by securing high-grade resources in Brazil and Southeast Asia, effectively attempting to rebuild a domestic-aligned industrial base from the ground up.”

“Google released a major quantum warning directed squarely at us. They have an algorithmic breakthrough that just 20x'd progress towards cracking ECDSA and some of the crypto signatures that underlie Bitcoin, Ethereum, and basically everything we do here. How bad is it for crypto? I think it's pretty concerning.”

“Canadian space agency astronaut Jeremy Hansen said he was struck by seeing the Earth wax and wane as they traveled through space and their view of the planet changed. It was a half Earth, then it was a full Earth, and then it was a no Earth.”

“Term 2.0 is trending imperial as the US flexes financial and military muscle across the globe, from the Strait of Hormuz to the Panama Canal. This shift suggests we are entering a phase where the republic's constraints are being shed in favor of a more aggressive, imperial posture to maintain global dominance against rising competitors. It's no longer just about trade; it's about control over the most critical strategic chokepoints in the world.”

“NVIDIA on a tear... It is up 6% in a very short amount of time there. We bounced off the 200, bounced off this trend line from 2024, and now that thing is moving up, but coming up into a previous all-time high.”

“The 30-day correlation here between the dollar and Bitcoin is now negative .9. It's the most negative reading since September 2022. A below zero reading indicates inverse relationship. So that means when the dollar weakens, Bitcoin gains and vice versa.”

“When you look at Strategy's STRK preferred stock mechanics, you start to see the systemic risks building in these complex DeFi derivatives. Recent hacks and exploits are just the tip of the iceberg; the real danger lies in the lack of transparency regarding the collateral backing these instruments and how they might behave during a period of extreme market stress or liquidity contraction.”

“While ceasefire headlines are currently whipsawing market sentiment, oil prices simply aren't reflecting the full strategic picture or the thresholds of the US-China leverage game. We are watching a high-stakes competition where both sides are testing who blinks first on gas prices and supply chain disruptions, and the current market pricing seems to be ignoring the very real potential for a massive strategic miscalculation.”

“I think the level that a lot of people are looking at from a technical perspective and especially some of the smartest technical investors I follow, they are looking for a weekly close over 75, which we have not yet had in, I believe since the February 6th down or drop. It does look like we're going to get that this weekend, at least as of right now. So I think that is the breakout signal that he was looking for in particular.”

“If you check out the monster of DeFi, Aave, things are headed downhill. So when this scenario started, it was about $25 billion total value locked, and it's sitting now at about $14 billion, right? So there is plenty of room to the downside on Aave.”

“Our view at LeDin was always that if we wanted to get the cheapest cost of capital to disperse to clients in Bitcoin-backed loans, we had to go the regulated route. The regulated entities like pension funds, insurance companies, banks, etc., they are the ones that historically have the cheapest cost of capital, which makes the most sense for you to borrow from and lend to other people. So an example of that is our ABS bond, which is the first Bitcoin ABS bond rated by S&P.”

“Also, the biggest hack, I think, in Solana history, a $300 million hack, the Drift Exchange, this is a purpose exchange, was hacked. What happened and what can we learn? It's all about the lessons we learn along the way, isn't it?”

“But there's this weird dynamic on chain, which is I can just issue a utility token to fund my project. And so like what role does debt actually play? And I guess my view would be it largely has been supply and demand for leverage. And so credit cycles on chain, they don't necessarily follow sort of credit cycles in the TradFi world.”

“Morgan Stanley is effectively creating something called the stablecoin reserves portfolio, where they're offering to custody, manage treasury, redemptions and issuance of stablecoins for companies. So think of it as if USDC or USDT gives up all of the back end of doing it, or more specifically, probably if someone wants to launch a new stablecoin, you now have Morgan Stanley behind you handling everything.”

“I think we always wanted to get here to have something like quality assets that people can simply hold on chain, self-custody, or, you know, borrow land loop, which is like kind of like a simple way of tranching it, you know, getting the senior trash or the junior trash by lending or by looping it.”

“I think for this cycle to work in a big way, it has to be retail driven and or agent driven, like Mike was saying before, like retail almost needs to interact with agents or agents need to interact with themselves and get this thing going. And I think that will happen. So like, that's what I'm bullish on this next cycle.”

“Did Ethereum just come up with a plan to finally unite all of the Layer 2s? They're called Ethereum Economic Zones. We'll spell out what that means. Aavev4 just released. What's new in that?”