WEBVTT
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Hello, welcome back to Cointelegraph's Chain Reaction, our very own live show here on X.
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My name's Kieran, I'm your host, and today I'm joined by Coin Bureau founder, Nick Puckran.
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Nick, how are you doing?
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Hey Kieran, it's all good, man.
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Thanks for having me on.
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Thanks for uh joining us.
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It's been a while.
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Just talking before, I think it's been been what around a year since we we saw each other last in real life.
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Almost a year, man.
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Yeah.
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Time flies when you're having fun.
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Bitcoin was over a hundred thousand when we last saw each other.
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So and and here we're celebrating with it just about over 85k.
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Shows you how fleeting sentiment is.
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It's crazy to think like 85k around that time last year.
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I mean, October last year was we're we were all-time highs.
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And now to think, you know, a year on from then we're yeah, we are celebrating, you know, the the greed indicators are back all around 85k.
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So what do you think is uh is happening at the moment?
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Like what do you think is going to drive the next move for Bitcoin from a macro outlook?
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Um from a macro outlook, I think it's just this broader question of uh the debasement of the US dollar uh and financial repression, what it's what's going on right now, right?
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I think that it's finally come to a head in terms of the broader concerns around the US debt levels and the sustainability of that and the machinations that are going on behind this, that are going on behind the scenes to try and alleviate that.
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I think that, as you'll recall, the Bitcoin rally was started back in August when uh Scott Bessant announced these buybacks, these treasury buybacks.
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And the the reason he went and did that was because he wanted to try and suppress the yields.
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And suppressing yields when you've got high inflation, that's textbook 101 financial repression, right?
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So the market saw through that, and you saw a rally in uh the in assets that are risk-off, that are a hedge against debasement and financial repression, and that was Bitcoin and gold.
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Uh so that spurred the rally then.
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And the thing about this is that although, yes, we did have the Fed rate hike about last, about a week or two ago, that naturally would have many would have thought this is going to lead to a sell-off in risk assets.
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It didn't happen with Bitcoin and gold.
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And that's because I think that the broader, longer-term shift now is that the market realizes we are going towards a world of major financial repression, uh, where we've got the debasement of the US dollar.
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And then also questions around uh de dollarization as as well, uh, and the lessening significance of the US dollar.
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And I think that's what's drive driven it, what drove the initial pump.
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And then, of course, there was a lot of short positioning going on as well with Bitcoin, um, uh, and that of course led to the explosive melt-ups.
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And uh, yeah, so I think that that's what's driving it right now.
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And I think that no matter what happens in the short term or interim in terms of like uh what monetary policy we see, these shifts cannot be uh cannot be altered.
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I think these these global paradigm shifts.
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And that is what I think most investors are now realizing.
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Uh, and uh that's why I feel comfortable like holding Bitcoin in this environment and and the likes of gold as well.
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So you mentioned as well around the Fed rates, and it's interesting because last week we not only had the Fed rate spike and also we had the Clarity Act not go the way that the industry was hoping either, both negative events or perceived negative events for the crypto industry.
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So then why do you think following those two negative events we saw Bitcoin's price go the other way?
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Um do you think it was just a clearance of uh this overhang of of catalysts and now it's you know, there's I don't know, like the the road is clear again, again for more fundamentals, or what's your view on that?
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So I think there were a few factors.
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I think one, um, there probably was a lot of uh short positioning going into uh the Clarity Act, specifically the Clarity Act on the crypto side of it.
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And um when uh the Clarity Act failed, I think many people expected it was gonna fail to a degree, but the market was still short, they were still short in it because they saw prior to the Clarity Act um vote, you saw Bitcoin kind of trending a little bit down, which is you know, textbook potentially we're gonna face some sort of uh a retracement back to the lows we we saw about a month ago.
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Uh but when uh the when when when that didn't happen and you had more positioning coming into Bitcoin because of these flows I mentioned around the questions of financial repression.
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And also I will note that we've seen massive ETF inflows, and ETFs aren't necessarily crypto natives, asset allocators there, they are retail coming back, coming back into the market.
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They started allocating just because they wanted to get Bitcoin exposure.
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So you have massive short positioning going into clarity, and then you have these new flows coming in, and you have bidders on the market makers and the uh authorized participants doing the bidding for the ETFs, and then you saw this spot rally, which of course was ex uh it led to the short positioning, uh the short squeeze that we saw out of clarity.
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And that's why I think that it rallied uh post-Clarity uh and right where we've got to to today.
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What what does the the Clarity Act setback tell you about US regulation now?
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Like where to from here?
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Well, I think that um in terms of the regulation and legislation, two different components there.
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I think on the regulation component, the SEC and CFTC are still very pro-crypto, obviously.
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They were uh the the chairs were installed by Trump, and they're trying to do as much as they can with rulemaking criteria uh to afford the industry some short-term clarity, shall we say, around uh around uh digital assets and more specifically around tokenized securities on the SEC side with this so-called uh innovation exemption, which they released last week.
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Uh so that does provide some certainty for the industry for at least the next two years.
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Uh back to the legislation components, and this is very important because it's it's codifying for the future in terms of how people would think about classifying these asset class as an asset class and which regulator would have oversight of that.
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And I think that that still remains a question.
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Uh, uh, because post, you know, if we have a new presidency in 2028, uh, then you could always have a new president who's going to decide and replace the current uh CFTC and SEC chairs and uh employees and commissioners, to the extent that then they could reverse some of these uh rulemaking criteria that was implemented by the SEC and the CFTC.
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So short term, the the regulators have tried to do what they can to provide some certainty.
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But long term, the question of what these assets are and how they fit into the US financial framework, legislative regulatory financial framework remains in question.
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And it's an interesting point you said is if we don't essentially have such a pro-crypto president come in in the next administration, um, how does that look?
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Because some crypto executives, maybe they're too optimistic, say that isn't a possibility when I've asked before around, you know, what happens if we do get this anti-crypto president that comes in.
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So do you still think that that is a possibility following Trump's administration?
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We do see um like there is a chance that someone comes in anti-crypto, and the fact that we haven't, you know, got the Clarity Act in place, there is a chance for, you know, the years of progression maybe within this pro-crypto administration to go backwards.
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I don't think we're gonna get any sort of administration that's going to be actively anti-crypto.
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Uh I think that look, uh crypto has now evolved to the stage at which it's embedded within the traditional financial system.
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People understand uh the benefits of uh you know blockchain rails and uh why we need alternatives to the traditional financial system.
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So I don't think you're gonna have someone who's gonna come in there and like we're gonna we're gonna try and kill the crypto industry.
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What I do think though, um is that there's been a let's be let's be frank, there's been a lot of uh you know forged activity taking place uh in crypto, a lot of pay-for-play.
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There's been a lot of uh, unfortunately, questions around um you know politicization of crypto through Trump, basically launching these particular launching meme coins, getting involved in projects, and and and and essentially that unfortunately has led to this you know uh pushback from the other side, which views it now as a as an opportunity to attack their political opponents.
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So if you do have a ver if you do have a complete change of guard in both Congress and presidency in two years' time, then they're going to want to go after um all of these industry participants who they could who they view as could potentially have uh been involved in any sort of deals with Trump.
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And that's in fact, they've they're very much on the record of saying that, especially if we do have in the next uh after the midterms, you have a democratic and uh democratic House and Senate.
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They're gonna go and launch investigations into Trump's crypto projects.
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Uh so that is going to take, that's going to be the main headline story for the next two years.
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But it doesn't make sense for a crypto.
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Like to to if you think about how much crypto uh assets and digital digital asset technology is embedded within the traditional financial system now, it doesn't make sense for them to try and just crush it because of spite.
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I think they can eat they can differentiate between uh cryptocurrency that is uh that is worth investing in and the technology that is worth building out versus that which is just built for enrichment.
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Absolutely.
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And I guess just looking at the crypto industry as a whole now, what do you think are the biggest bottlenecks in the crypto industry that are preventing it from wider adoption, but also just within the industry itself and the businesses that are working within crypto?
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So I think that um regulation, I mean legislation still is one.
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I think, like I said, it's just a it's just a two-year rulemaking uh reprieve from the SEC.
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So there's still the question for especially the larger asset allocations and allocators and corporates that maybe have thought about uh investing more heavily in digital asset technology.
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That is something that they may question.
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Uh, there isn't given that certainty.
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But then I also think image more broadly, uh, for especially for retail, like I say, it's become incredibly politicized to the extent that many people view it as, oh, it's it's a uh right-wing Trump thing, crypto.
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I don't want to get involved in that.
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What's the use of crypto?
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And it's not only Trump, to be fair to him as well.
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Like, I mean, especially over the past two, three years, the meme coin industrial complex of people just you like trading just meme coins and meme coins where we know the statistics on uh the winners and losers on this and uh what the end game is with meme coins.
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And I think that people, if you speak to people who haven't been involved, who don't know much about crypto, that's what they associate it with.
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It's like, and those who did actually decide to come and actually try and invest in cryptocurrency, but they came through the meme coin, you know, entry point, they probably lost money, most likely, and they have a bad uh they have a bad taste in their mouth, and then and then they don't really feel like it's an industry they want to be involved in.
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So I think that that's um another headwind.
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And finally, I think uh it's a victim of circumstance as well, is um another uh final headwind is what's going on with uh other alternative asset classes that are more appealing.
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And right now it's been the AI trade, right?
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I think that many people have uh seen uh just that they've been more invested in what's going on in that space.
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It's directly relatable to what they're doing in their daily lives.
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Everyone uses the technology, and then and now they're considering, well, should I invest in this meme coin which has just been pumped by you know XY uh influence, or could I invest in SpaceX or uh you know NVIDIA?
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Obviously, um I think that the one is slightly more appealing because it's like at least I know I'm investing in a company which I can value and I can actually like I use the I use um the the tech in my daily life, uh whereas uh for some meme coins is it's just very PvP and extractive.
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So I think those are the biggest headwinds.
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Yeah, definitely.
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I want to get onto AI with you as well, but just on the Trump meme coin as well, do you ever think about how the industry might look now?
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And I guess is there any things in particular you think would have happened or the outcomes would have happened if Trump had never launched that meme coin before his inauguration?
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Yeah, man, it would have been so much better, so much more different.
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I think we would have had a, it would be would have been a crypto panacea.
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I think that so much, I mean, you can go, you know, you can always go back and like hindsight's 2020 and how much would have changed.
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I mean, to be honest, if Trump hadn't, you know, been so volatile on Truth Social and hadn't tweeted that thing about the Chinese tariffs back in October 10th, October 10th last year, we wouldn't have had that cascading liquidation that crushed everything and destroyed the market makers and destroyed the market uh over 24 hours.
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In terms of the launch of the meme coin, yeah, I mean like I think that it's and it's not just the meme coin, I think like the you could see the uh the massive the when Trump released his um his financial disclosure forms, okay.
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So just prior to him disclosing that, like earlier in this year, there was progress being made on clarity to the extent that the politicians were getting together, working with the industry, working with the banks to kind of see if there was could be a compromise.
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Democrats were fully on board with a lot of stuff, and they were discussing this with the public Republicans, but it seemed as if there was some there they were working together.
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Then out came the financial disclosure forms, and they showed that made something like$1.6 billion from crypto.
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And it's an important context there because I think that that's the most he's ever made of any financial venture in a year.
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Real estate, branding, everything combined, just in that crypto, in his crypto ventures.
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And that a lot of that was meme coin um trading fees on the on the Trump meme coin.
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So yeah, the moment that came out, the the Democrats are like, no, now we need very strong uh ethics provisions in this, and uh there was outrage about it, and that kind of threw a spanner in the works.
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So yeah, it was the meme coin.
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We kind of, I think, I personally think that's the meme coin that killed clarity.
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Like before his inauguration as well, his part of his campaign, he was very pro-crypto, pro-Bitcoin.
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Um now, looking back as well, obviously, if there was an alternative president, if he didn't get in and, you know, it was Kamala or someone else that was not as as vocal about crypto or even anti-crypto, do you think that we'd be in the same position now, or even worse in the crypto industry, or even maybe better with an anti-crypto um president in the US?
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Another another politician, a Kamala, yeah.
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I mean, that's the million dollar question, right?
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How would have crypto have been?
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I think look, I don't I don't think they would have been meaningfully anti-crypto.
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Yes, I don't think they would have um you know uh taken on board the same pro-crypto SEC and CFTC chairs, but I don't think it would have been their their MO would have been let's see how we can crush the crypto industry.
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Uh so and then again, I think it would have there would have been constructive discussions on either side.
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And the the most important point is that crypto wouldn't have been politicized.
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Because at the end of the day, it's it's um it's it's unfortunate because crypto itself is a it's a it's an apolitical technology, right?
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It's left and right should be able to use it and feel free to invest in it, and we shouldn't we shouldn't be making political statements.
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And at the end of the day, you can go back to even the cypunk uh ideology from the early days is like uh crypto is outside of the system.
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We don't need the politicians and laws and regulations there.
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So I mean if that's the ideals of it.
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But yeah, I don't think it would have been meaningfully worse, to be honest.
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In fact, I think it could have been better because you could have had constructive discussions around legislation.
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So they're moving on to AI as well, because the the main big message that everyone in the crypto industry has been saying this year is that AI capital has been sucking away crypto capital for the start of this year and being a big catalyst for why Bitcoin's price was trading the way it was, um, and more broadly the crypto market as well.
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So, first of all, do you agree with that statement in large?
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And do you see that trade reversing?
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Um, you know, especially around the concerns with the AI bubble, or is AI still set to uh continue attracting that capital and crypto just has to deal with it and uh find other ways to attract, interact investors itself?
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Yeah, no doubt it's definitely taken uh not only capital uh but attention as well.
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Yeah.
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Uh and I think that um, and that's a fact.
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Whether it's we're I mean, whether AI is in a bubble is also another million dollar question.
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There's so many theses out there.
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I think that uh look, it's still got room to run.
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I think that um there's still a lot of juice in the market.
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We've still got a lot of the biggest IPOs.
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I mean, although you think SpaceX was large, the biggest IPOs still haven't hit the market.
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Like Anthropics coming to the to try and do a two trillion dollar IPO, right?
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Now, that's mad, right?
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And like you can't obviously some of that capital will have to come from plays from allocators that may have wanted to invest in crypto.
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And then there's also open AI coming, and there's all the other ones that are that they're trying to come this late stage in the AI trade, all these large private companies and the and the labs and the uh and so many of the other infrastructure plays and data center providers are trying to come to market and get some of their exit liquidity from the public markets, right?
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So uh it's still going to it's still going to weigh on attention uh in the next in the next few months and draw some capital that could have gone to crypto.
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Then I guess the question is, okay, if we do have a situation in which the AI trade rolls over and it collapses, I don't know, man.
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It's difficult to see a world in which people are going to drive, then allocate back into like altcoins or something, right?
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Because there is so much is actually, and it's actually there's so much that is built into that AI trade.
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It's not just on the side of capital uh and and asset prices, but the entire the US economy, like if you look at how where the growth has come over the past uh you know, over the past few few few years, like few months, it's mostly been the AI build out, right?
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Uh so there's so much built into that.
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So if that AI trade turns, you know, rolls over, uh, that calls into question a lot of things.
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I think though, if you if we are gonna have that, that will obviously lead to a massive collapse in the stock price and in the indices, right?
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Because so much of the indices are made up of these AI names.
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Uh and you'll have a massive collapse in in portfolios.
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And um but I think in that environment, so you have, let's assume it's even impacts on the economy as well, because the economa the economic slowdown begins because that you don't have the AI build-out anymore.
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I think this is still an an environment in which hard assets, like which of which Bitcoin is one of the Bitcoin and gold are one of the prime examples, will benefit.
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Uh they will be the ultimate risk-off hedge and the escape from that that roll-off, that, that rollover.
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Old coins, yeah, I mean, it's a bit more, I think they're more on the side of the risk-on spectrum of asset allocation.
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Yeah, and just on gold as well.
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I mean, how do you see the relationship between Bitcoin and golds going in the coming years?
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Um, you know, like there's more and more argument now for just Bitcoin going into that store of value run as opposed to defining ways around its use as a currency.
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So, you know, do you see that that relationship going together?
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We saw golds go to all-time highs earlier this year.
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A lot of people expected Bitcoin to follow.
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It didn't follow.
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Um, so how do you see that relationship kind of developing over the coming years?
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Yeah, so I think the relationship uh as at least the correlation itself um hit an all-time hit a near or near high about a week or two ago, probably like a month ago.
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As I mentioned at the beginning of the the stream, that uh we saw gold and bitcoin both rally at about the same time on the back of the buybacks announcements.
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Uh so um I think there is this consensus in the market that if you're looking for a debasement uh de-dollarization trade, a hedge against inflation and the financial repression I mentioned, it's gold and Bitcoin.
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And they have the same, many same qualities, you know, limited in supply, uh, hard money characteristics, uh uh not easy to be seized.
00:20:53.759 --> 00:20:59.599
Uh you know, if you if you hold it, it's not you know financializing the financial system, so you can actually hold it yourself.
00:20:59.839 --> 00:21:02.559
That's why Bitcoin and gold are viewed in that same bucket.
00:21:02.720 --> 00:21:17.359
Of course, they each have their unique um you know characteristics that over one over the other, but I think it makes sense to have both in the portfolio if you do believe we're going into this world of negative real rates, high inflation, lower um financial oppression, etc.
00:21:18.160 --> 00:21:18.640
Awesome.
00:21:18.880 --> 00:21:24.079
Now, um, I wanted to talk to you as well around what narratives within the crypto industry you're most bullish on at the moment.
00:21:24.240 --> 00:21:28.559
Obviously, there's a lot of buzzwords with AI agents, there's the RWAs.
00:21:28.720 --> 00:21:36.640
Um, you know, like for yourself, what what particular sector right now are you most bullish on in the industry over the coming 12 months?
00:21:37.200 --> 00:21:42.960
In the I think it's around the strongest narratives or those that uh we see a lot of adoption going on right now.
00:21:43.200 --> 00:21:54.160
So I think RWA tokenization is a big one, especially as it relates to potentially around uh the uh how it uh you know, the intersection with that and AI.
00:21:54.240 --> 00:22:01.599
And then that is what, for example, specifically as it relates to AI tokenization tokenization of uh AI agentic payments.
00:22:01.759 --> 00:22:15.359
So we had the um yesterday, I think yesterday we had a report from BlackRock that broke down why uh you know digital like like the FAI agents are making payments on making payments to each other, it makes sense for them to do it on-chain.
00:22:15.440 --> 00:22:26.000
And that's why I think stable coins and the stablecoin infrastructure is an important narrative for you know adoption that we've seen go on in the next uh over the past few months and increasingly forward.
00:22:26.240 --> 00:22:34.160
And then there's also I think uh adoption around, I think about like what people are using crypto for these days and block and blockchain Rails.
00:22:34.240 --> 00:22:36.000
I think it's uh speculation.
00:22:36.160 --> 00:22:45.519
And one of the best, one of the biggest speculation plays right now, I think, is perp taxes, and of which the leader in that category is hyper liquid.
00:22:45.680 --> 00:22:48.559
So hyper liquid is doing well, it's near all-time highs.
00:22:48.720 --> 00:23:00.319
There is massive adoption, it's basically giving uh uh like proper stock trading venues a run for their money in terms of volume, and that adoption is just going sky high.
00:23:00.480 --> 00:23:04.799
And there's they're also engaging with uh they're engaging with regulators as well.
00:23:04.880 --> 00:23:10.559
I believe there's talk going on between uh uh you know the regulators, the CFTC, and the likes of Hyper Liquid.
00:23:10.640 --> 00:23:15.440
And I think Trump even mentioned Hyper Liquid in his um conference two weeks ago.
00:23:16.160 --> 00:23:18.000
Yeah, no, he mentioned hyperliquid.
00:23:18.319 --> 00:23:19.920
He gave a shill to hyperliquid.
00:23:20.319 --> 00:23:32.960
He did, and so like everyone in crypto, honestly, and I say this, you know, a little bit on the streams, like every episode with crypto executives, you can't get through 30 minutes without them bringing up hyper liquid.
00:23:33.119 --> 00:23:40.559
Like there's times where they don't bring up ETH, Solana, XRP, but hyperliquid is always brought up in in some way.
00:23:40.640 --> 00:23:41.519
It's it's crazy.
00:23:41.599 --> 00:23:48.319
Like, I don't think there has been an episode in like the last six months where it's the consensus trade.
00:23:48.400 --> 00:23:49.359
It's the consensus view.
00:23:49.599 --> 00:23:55.359
I think it's like it, and also it's right, it's the adoption we've seen take place within it, and people are using it.
00:23:55.440 --> 00:23:57.519
Uh, there's the fees being generated from it.
00:23:57.599 --> 00:24:00.319
So it's actually uh uh from a fundamental perspective.
00:24:00.400 --> 00:24:04.720
If you want to do a fundamental analysis on it, it's actually a protocol generating revenue.
00:24:04.880 --> 00:24:08.880
So that's important for many people who view assets through that lens.
00:24:09.039 --> 00:24:12.160
Uh, and it's you know become an institutional name now.
00:24:12.240 --> 00:24:16.160
I mean, people are using hyperliquid as a primary venue for trading 24-7.
00:24:16.319 --> 00:24:21.119
I mean, people are like if on the weekends, if you want to trade oil, can't do that in the traditional markets.
00:24:21.200 --> 00:24:26.880
People that can also use it as a method to kind of like get a sense of where markets are moving in the aftermarket hours.
00:24:27.119 --> 00:24:30.000
So that that's seen a massive adoption and traction.
00:24:30.160 --> 00:24:39.920
I think obviously we've also seen uh Zcash rallying past all-time highs um that we saw previously and just not stopping.
00:24:40.079 --> 00:24:45.440
And I think that is around this real demand for uh you know a private version of Bitcoin, right?
00:24:45.519 --> 00:24:49.599
And I think that they've captured that narrative uh well.
00:24:49.759 --> 00:24:59.200
And they have the right they have people back in it in terms of like who have reach and they obviously are you know singing its praises, which is helping to get its attention.
00:24:59.440 --> 00:25:05.440
But I also think there's some Bitcoin OGs who really who do believe in it uh and are allocating towards it.
00:25:05.759 --> 00:25:19.680
So that's another narrative which at least the privacy narrative itself is strong because we know we go, you know, on-chain privacy doesn't exist unless you're using technology like Zcash to kind of like keep your your currency and your your coins fully private.
00:25:19.920 --> 00:25:27.119
So I think that that's another narrative that I feel can one can be bullish on going if we're going to have some sort of an altcoin research resurgence.
00:25:27.519 --> 00:25:42.880
I had um Zach from Grayscale on the other week, and he was saying that the crypto market is still underestimating privacy tokens, uh, you know, despite Zcash where it is now, there's still that uh feeling that there's not been that mass allocation yet.
00:25:42.960 --> 00:25:44.000
So, what's your views on that?
00:25:44.079 --> 00:25:48.160
Do you still think there's a lot more upside there for tokens like Zcash?
00:25:48.400 --> 00:25:48.880
I think so.
00:25:49.039 --> 00:25:49.440
I think so.
00:25:49.599 --> 00:26:00.720
I mean, I think that um because at the end of the day, uh people are now realizing fully that, you know, Bitcoin, uh, Ethereum, all these on-chain currencies aren't fully private.
00:26:00.880 --> 00:26:05.359
In fact, they're probably even inferior to the likes of cash, right?
00:26:05.680 --> 00:26:12.400
To the extent that they can be uh that you can track, you can track people's, you know, transactions, right?
00:26:12.640 --> 00:26:28.480
And now more and more people are realizing that this is something that uh is an issue for financial privacy uh in the world where you have a lot of these stories about people getting uh you know kidnapped for their crypto and their personal digital identities getting shared online.
00:26:29.039 --> 00:26:30.799
Uh and uh I think that that's important.
00:26:30.880 --> 00:26:37.440
And I think there's no other one of the best ways to shield yourself from this is to invest in privacy coins, right?
00:26:37.599 --> 00:26:41.279
And um, that's what Zcash and Monero uh offer.
00:26:42.000 --> 00:26:47.920
So yeah, I think that's it's is definitely something that I think many people will wake up to if they haven't already.
00:26:48.319 --> 00:27:02.319
And um just the final point, Nick, is before we did talk around hyperliquid, I guess with all the bullishness that's around hyper liquid, all the executives that think it's amazing, um, what do you think is a potential bear case for a hyperliquid?
00:27:02.559 --> 00:27:03.359
Yeah, okay.
00:27:03.440 --> 00:27:07.039
So one bear case I think is around, again, regulation, right?
00:27:07.200 --> 00:27:27.920
So if you do have uh there is the questions around uh if we do have a change of guard from in two years' time and you have a you know CFTC chair who views this as kind of like competition for the likes of the CME and the regulated venues, uh, could they, you know, essentially limit, uh restrict access to it, access to it in the US?
00:27:28.079 --> 00:27:29.759
Could they take it to court or something?
00:27:29.839 --> 00:27:36.319
That is, if by by the rule of the law, you know, they could have a case for it in terms of like it's not a regulated venue.
00:27:36.480 --> 00:27:37.759
So that's one thing.
00:27:38.000 --> 00:27:43.759
Um and there's always massive tail risks like black swans that people don't anticipate, right?
00:27:43.920 --> 00:27:49.039
I mean, uh uh what happens if you have a massive hack of hyper liquid, right?
00:27:49.119 --> 00:28:02.480
I mean, I recall I recall that um a year ago uh there was the questions around whether North Korea was sniffing around in uh hyper liquid trades and everything, and that led many people to question how how secure it was.
00:28:02.640 --> 00:28:04.319
But I think those are the only real risks.
00:28:04.559 --> 00:28:04.880
Awesome.
00:28:05.039 --> 00:28:07.359
Nick, thank you very much for joining us on the show, man.
00:28:07.440 --> 00:28:07.920
Appreciate it.
00:28:08.079 --> 00:28:08.880
No worries, Kieran.
00:28:08.960 --> 00:28:09.519
Thanks for having me.
00:28:09.599 --> 00:28:10.640
Appreciate it.
00:00:00.560 --> 00:00:05.679
Hello, welcome back to Cointelegraph's Chain Reaction, our very own live show here on X.
00:00:06.160 --> 00:00:12.400
My name's Kieran, I'm your host, and today I'm joined by Coin Bureau founder, Nick Puckran.
00:00:12.560 --> 00:00:13.439
Nick, how are you doing?
00:00:13.679 --> 00:00:15.039
Hey Kieran, it's all good, man.
00:00:15.119 --> 00:00:16.399
Thanks for having me on.
00:00:16.719 --> 00:00:18.000
Thanks for uh joining us.
00:00:18.079 --> 00:00:18.640
It's been a while.
00:00:18.960 --> 00:00:25.039
Just talking before, I think it's been been what around a year since we we saw each other last in real life.
00:00:25.440 --> 00:00:26.559
Almost a year, man.
00:00:26.640 --> 00:00:26.879
Yeah.
00:00:27.039 --> 00:00:28.800
Time flies when you're having fun.
00:00:29.280 --> 00:00:32.399
Bitcoin was over a hundred thousand when we last saw each other.
00:00:32.560 --> 00:00:37.759
So and and here we're celebrating with it just about over 85k.
00:00:38.399 --> 00:00:40.320
Shows you how fleeting sentiment is.
00:00:41.119 --> 00:00:44.719
It's crazy to think like 85k around that time last year.
00:00:44.960 --> 00:00:48.640
I mean, October last year was we're we were all-time highs.
00:00:48.799 --> 00:00:57.359
And now to think, you know, a year on from then we're yeah, we are celebrating, you know, the the greed indicators are back all around 85k.
00:00:57.520 --> 00:01:00.399
So what do you think is uh is happening at the moment?
00:01:00.560 --> 00:01:06.480
Like what do you think is going to drive the next move for Bitcoin from a macro outlook?
00:01:07.200 --> 00:01:18.000
Um from a macro outlook, I think it's just this broader question of uh the debasement of the US dollar uh and financial repression, what it's what's going on right now, right?
00:01:18.079 --> 00:01:31.840
I think that it's finally come to a head in terms of the broader concerns around the US debt levels and the sustainability of that and the machinations that are going on behind this, that are going on behind the scenes to try and alleviate that.
00:01:32.000 --> 00:01:41.280
I think that, as you'll recall, the Bitcoin rally was started back in August when uh Scott Bessant announced these buybacks, these treasury buybacks.
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And the the reason he went and did that was because he wanted to try and suppress the yields.
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And suppressing yields when you've got high inflation, that's textbook 101 financial repression, right?
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So the market saw through that, and you saw a rally in uh the in assets that are risk-off, that are a hedge against debasement and financial repression, and that was Bitcoin and gold.
00:02:02.480 --> 00:02:04.799
Uh so that spurred the rally then.
00:02:05.040 --> 00:02:17.599
And the thing about this is that although, yes, we did have the Fed rate hike about last, about a week or two ago, that naturally would have many would have thought this is going to lead to a sell-off in risk assets.
00:02:17.919 --> 00:02:20.319
It didn't happen with Bitcoin and gold.
00:02:20.479 --> 00:02:32.719
And that's because I think that the broader, longer-term shift now is that the market realizes we are going towards a world of major financial repression, uh, where we've got the debasement of the US dollar.
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And then also questions around uh de dollarization as as well, uh, and the lessening significance of the US dollar.
00:02:40.639 --> 00:02:43.919
And I think that's what's drive driven it, what drove the initial pump.
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And then, of course, there was a lot of short positioning going on as well with Bitcoin, um, uh, and that of course led to the explosive melt-ups.
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And uh, yeah, so I think that that's what's driving it right now.
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And I think that no matter what happens in the short term or interim in terms of like uh what monetary policy we see, these shifts cannot be uh cannot be altered.
00:03:04.000 --> 00:03:06.719
I think these these global paradigm shifts.
00:03:06.879 --> 00:03:10.000
And that is what I think most investors are now realizing.
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Uh, and uh that's why I feel comfortable like holding Bitcoin in this environment and and the likes of gold as well.
00:03:16.240 --> 00:03:31.759
So you mentioned as well around the Fed rates, and it's interesting because last week we not only had the Fed rate spike and also we had the Clarity Act not go the way that the industry was hoping either, both negative events or perceived negative events for the crypto industry.
00:03:32.000 --> 00:03:39.199
So then why do you think following those two negative events we saw Bitcoin's price go the other way?
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Um do you think it was just a clearance of uh this overhang of of catalysts and now it's you know, there's I don't know, like the the road is clear again, again for more fundamentals, or what's your view on that?
00:03:55.039 --> 00:03:56.319
So I think there were a few factors.
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I think one, um, there probably was a lot of uh short positioning going into uh the Clarity Act, specifically the Clarity Act on the crypto side of it.
00:04:06.159 --> 00:04:25.920
And um when uh the Clarity Act failed, I think many people expected it was gonna fail to a degree, but the market was still short, they were still short in it because they saw prior to the Clarity Act um vote, you saw Bitcoin kind of trending a little bit down, which is you know, textbook potentially we're gonna face some sort of uh a retracement back to the lows we we saw about a month ago.
00:04:26.079 --> 00:04:35.519
Uh but when uh the when when when that didn't happen and you had more positioning coming into Bitcoin because of these flows I mentioned around the questions of financial repression.
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And also I will note that we've seen massive ETF inflows, and ETFs aren't necessarily crypto natives, asset allocators there, they are retail coming back, coming back into the market.
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They started allocating just because they wanted to get Bitcoin exposure.
00:04:48.720 --> 00:05:09.360
So you have massive short positioning going into clarity, and then you have these new flows coming in, and you have bidders on the market makers and the uh authorized participants doing the bidding for the ETFs, and then you saw this spot rally, which of course was ex uh it led to the short positioning, uh the short squeeze that we saw out of clarity.
00:05:09.519 --> 00:05:17.360
And that's why I think that it rallied uh post-Clarity uh and right where we've got to to today.
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What what does the the Clarity Act setback tell you about US regulation now?
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Like where to from here?
00:05:23.519 --> 00:05:27.600
Well, I think that um in terms of the regulation and legislation, two different components there.
00:05:27.680 --> 00:05:32.399
I think on the regulation component, the SEC and CFTC are still very pro-crypto, obviously.
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They were uh the the chairs were installed by Trump, and they're trying to do as much as they can with rulemaking criteria uh to afford the industry some short-term clarity, shall we say, around uh around uh digital assets and more specifically around tokenized securities on the SEC side with this so-called uh innovation exemption, which they released last week.
00:05:55.439 --> 00:06:00.560
Uh so that does provide some certainty for the industry for at least the next two years.
00:06:00.800 --> 00:06:14.959
Uh back to the legislation components, and this is very important because it's it's codifying for the future in terms of how people would think about classifying these asset class as an asset class and which regulator would have oversight of that.
00:06:15.120 --> 00:06:17.519
And I think that that still remains a question.
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Uh, uh, because post, you know, if we have a new presidency in 2028, uh, then you could always have a new president who's going to decide and replace the current uh CFTC and SEC chairs and uh employees and commissioners, to the extent that then they could reverse some of these uh rulemaking criteria that was implemented by the SEC and the CFTC.
00:06:40.480 --> 00:06:45.360
So short term, the the regulators have tried to do what they can to provide some certainty.
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But long term, the question of what these assets are and how they fit into the US financial framework, legislative regulatory financial framework remains in question.
00:06:55.279 --> 00:07:04.160
And it's an interesting point you said is if we don't essentially have such a pro-crypto president come in in the next administration, um, how does that look?
00:07:04.480 --> 00:07:14.240
Because some crypto executives, maybe they're too optimistic, say that isn't a possibility when I've asked before around, you know, what happens if we do get this anti-crypto president that comes in.
00:07:14.399 --> 00:07:18.399
So do you still think that that is a possibility following Trump's administration?
00:07:18.560 --> 00:07:34.399
We do see um like there is a chance that someone comes in anti-crypto, and the fact that we haven't, you know, got the Clarity Act in place, there is a chance for, you know, the years of progression maybe within this pro-crypto administration to go backwards.
00:07:35.360 --> 00:07:40.959
I don't think we're gonna get any sort of administration that's going to be actively anti-crypto.
00:07:41.199 --> 00:07:47.680
Uh I think that look, uh crypto has now evolved to the stage at which it's embedded within the traditional financial system.
00:07:47.920 --> 00:07:55.279
People understand uh the benefits of uh you know blockchain rails and uh why we need alternatives to the traditional financial system.
00:07:55.360 --> 00:07:59.759
So I don't think you're gonna have someone who's gonna come in there and like we're gonna we're gonna try and kill the crypto industry.
00:08:00.079 --> 00:08:12.720
What I do think though, um is that there's been a let's be let's be frank, there's been a lot of uh you know forged activity taking place uh in crypto, a lot of pay-for-play.
00:08:12.879 --> 00:08:35.679
There's been a lot of uh, unfortunately, questions around um you know politicization of crypto through Trump, basically launching these particular launching meme coins, getting involved in projects, and and and and essentially that unfortunately has led to this you know uh pushback from the other side, which views it now as a as an opportunity to attack their political opponents.
00:08:35.840 --> 00:08:53.600
So if you do have a ver if you do have a complete change of guard in both Congress and presidency in two years' time, then they're going to want to go after um all of these industry participants who they could who they view as could potentially have uh been involved in any sort of deals with Trump.
00:08:53.759 --> 00:09:03.759
And that's in fact, they've they're very much on the record of saying that, especially if we do have in the next uh after the midterms, you have a democratic and uh democratic House and Senate.
00:09:03.840 --> 00:09:07.759
They're gonna go and launch investigations into Trump's crypto projects.
00:09:07.840 --> 00:09:13.039
Uh so that is going to take, that's going to be the main headline story for the next two years.
00:09:13.279 --> 00:09:15.759
But it doesn't make sense for a crypto.
00:09:15.919 --> 00:09:26.639
Like to to if you think about how much crypto uh assets and digital digital asset technology is embedded within the traditional financial system now, it doesn't make sense for them to try and just crush it because of spite.
00:09:26.799 --> 00:09:39.279
I think they can eat they can differentiate between uh cryptocurrency that is uh that is worth investing in and the technology that is worth building out versus that which is just built for enrichment.
00:09:39.679 --> 00:09:40.399
Absolutely.
00:09:40.639 --> 00:09:56.080
And I guess just looking at the crypto industry as a whole now, what do you think are the biggest bottlenecks in the crypto industry that are preventing it from wider adoption, but also just within the industry itself and the businesses that are working within crypto?
00:09:56.799 --> 00:10:00.960
So I think that um regulation, I mean legislation still is one.
00:10:01.279 --> 00:10:06.159
I think, like I said, it's just a it's just a two-year rulemaking uh reprieve from the SEC.
00:10:06.240 --> 00:10:15.840
So there's still the question for especially the larger asset allocations and allocators and corporates that maybe have thought about uh investing more heavily in digital asset technology.
00:10:16.000 --> 00:10:18.000
That is something that they may question.
00:10:18.080 --> 00:10:20.080
Uh, there isn't given that certainty.
00:10:20.320 --> 00:10:33.600
But then I also think image more broadly, uh, for especially for retail, like I say, it's become incredibly politicized to the extent that many people view it as, oh, it's it's a uh right-wing Trump thing, crypto.
00:10:33.759 --> 00:10:35.120
I don't want to get involved in that.
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What's the use of crypto?
00:10:36.720 --> 00:10:38.720
And it's not only Trump, to be fair to him as well.
00:10:38.799 --> 00:10:54.080
Like, I mean, especially over the past two, three years, the meme coin industrial complex of people just you like trading just meme coins and meme coins where we know the statistics on uh the winners and losers on this and uh what the end game is with meme coins.
00:10:54.159 --> 00:11:00.080
And I think that people, if you speak to people who haven't been involved, who don't know much about crypto, that's what they associate it with.
00:11:00.159 --> 00:11:17.120
It's like, and those who did actually decide to come and actually try and invest in cryptocurrency, but they came through the meme coin, you know, entry point, they probably lost money, most likely, and they have a bad uh they have a bad taste in their mouth, and then and then they don't really feel like it's an industry they want to be involved in.
00:11:17.279 --> 00:11:19.759
So I think that that's um another headwind.
00:11:20.000 --> 00:11:30.159
And finally, I think uh it's a victim of circumstance as well, is um another uh final headwind is what's going on with uh other alternative asset classes that are more appealing.
00:11:30.320 --> 00:11:32.639
And right now it's been the AI trade, right?
00:11:32.799 --> 00:11:38.799
I think that many people have uh seen uh just that they've been more invested in what's going on in that space.
00:11:39.039 --> 00:11:41.919
It's directly relatable to what they're doing in their daily lives.
00:11:42.000 --> 00:11:55.759
Everyone uses the technology, and then and now they're considering, well, should I invest in this meme coin which has just been pumped by you know XY uh influence, or could I invest in SpaceX or uh you know NVIDIA?
00:11:56.480 --> 00:12:13.600
Obviously, um I think that the one is slightly more appealing because it's like at least I know I'm investing in a company which I can value and I can actually like I use the I use um the the tech in my daily life, uh whereas uh for some meme coins is it's just very PvP and extractive.
00:12:13.759 --> 00:12:15.919
So I think those are the biggest headwinds.
00:12:16.240 --> 00:12:16.879
Yeah, definitely.
00:12:16.960 --> 00:12:25.919
I want to get onto AI with you as well, but just on the Trump meme coin as well, do you ever think about how the industry might look now?
00:12:26.080 --> 00:12:36.240
And I guess is there any things in particular you think would have happened or the outcomes would have happened if Trump had never launched that meme coin before his inauguration?
00:12:36.559 --> 00:12:39.440
Yeah, man, it would have been so much better, so much more different.
00:12:39.519 --> 00:12:43.039
I think we would have had a, it would be would have been a crypto panacea.
00:12:43.440 --> 00:12:50.720
I think that so much, I mean, you can go, you know, you can always go back and like hindsight's 2020 and how much would have changed.
00:12:50.879 --> 00:13:09.440
I mean, to be honest, if Trump hadn't, you know, been so volatile on Truth Social and hadn't tweeted that thing about the Chinese tariffs back in October 10th, October 10th last year, we wouldn't have had that cascading liquidation that crushed everything and destroyed the market makers and destroyed the market uh over 24 hours.
00:13:10.000 --> 00:13:22.480
In terms of the launch of the meme coin, yeah, I mean like I think that it's and it's not just the meme coin, I think like the you could see the uh the massive the when Trump released his um his financial disclosure forms, okay.
00:13:22.559 --> 00:13:33.519
So just prior to him disclosing that, like earlier in this year, there was progress being made on clarity to the extent that the politicians were getting together, working with the industry, working with the banks to kind of see if there was could be a compromise.
00:13:33.759 --> 00:13:42.000
Democrats were fully on board with a lot of stuff, and they were discussing this with the public Republicans, but it seemed as if there was some there they were working together.
00:13:42.240 --> 00:13:50.720
Then out came the financial disclosure forms, and they showed that made something like$1.6 billion from crypto.
00:13:50.960 --> 00:13:57.600
And it's an important context there because I think that that's the most he's ever made of any financial venture in a year.
00:13:57.840 --> 00:14:02.720
Real estate, branding, everything combined, just in that crypto, in his crypto ventures.
00:14:02.799 --> 00:14:07.120
And that a lot of that was meme coin um trading fees on the on the Trump meme coin.
00:14:07.279 --> 00:14:19.200
So yeah, the moment that came out, the the Democrats are like, no, now we need very strong uh ethics provisions in this, and uh there was outrage about it, and that kind of threw a spanner in the works.
00:14:19.440 --> 00:14:21.360
So yeah, it was the meme coin.
00:14:21.440 --> 00:14:24.720
We kind of, I think, I personally think that's the meme coin that killed clarity.
00:14:25.120 --> 00:14:31.039
Like before his inauguration as well, his part of his campaign, he was very pro-crypto, pro-Bitcoin.
00:14:31.279 --> 00:14:54.720
Um now, looking back as well, obviously, if there was an alternative president, if he didn't get in and, you know, it was Kamala or someone else that was not as as vocal about crypto or even anti-crypto, do you think that we'd be in the same position now, or even worse in the crypto industry, or even maybe better with an anti-crypto um president in the US?
00:14:55.759 --> 00:14:58.159
Another another politician, a Kamala, yeah.
00:14:58.240 --> 00:14:59.600
I mean, that's the million dollar question, right?
00:14:59.679 --> 00:15:00.960
How would have crypto have been?
00:15:01.279 --> 00:15:05.360
I think look, I don't I don't think they would have been meaningfully anti-crypto.
00:15:05.440 --> 00:15:18.720
Yes, I don't think they would have um you know uh taken on board the same pro-crypto SEC and CFTC chairs, but I don't think it would have been their their MO would have been let's see how we can crush the crypto industry.
00:15:18.960 --> 00:15:23.360
Uh so and then again, I think it would have there would have been constructive discussions on either side.
00:15:23.440 --> 00:15:27.279
And the the most important point is that crypto wouldn't have been politicized.
00:15:27.440 --> 00:15:34.639
Because at the end of the day, it's it's um it's it's unfortunate because crypto itself is a it's a it's an apolitical technology, right?
00:15:34.799 --> 00:15:42.159
It's left and right should be able to use it and feel free to invest in it, and we shouldn't we shouldn't be making political statements.
00:15:42.240 --> 00:15:50.320
And at the end of the day, you can go back to even the cypunk uh ideology from the early days is like uh crypto is outside of the system.
00:15:50.480 --> 00:15:54.000
We don't need the politicians and laws and regulations there.
00:15:54.159 --> 00:15:56.159
So I mean if that's the ideals of it.
00:15:56.240 --> 00:15:59.840
But yeah, I don't think it would have been meaningfully worse, to be honest.
00:16:00.000 --> 00:16:03.840
In fact, I think it could have been better because you could have had constructive discussions around legislation.
00:16:04.159 --> 00:16:24.080
So they're moving on to AI as well, because the the main big message that everyone in the crypto industry has been saying this year is that AI capital has been sucking away crypto capital for the start of this year and being a big catalyst for why Bitcoin's price was trading the way it was, um, and more broadly the crypto market as well.
00:16:24.320 --> 00:16:28.320
So, first of all, do you agree with that statement in large?
00:16:28.399 --> 00:16:31.120
And do you see that trade reversing?
00:16:31.279 --> 00:16:46.240
Um, you know, especially around the concerns with the AI bubble, or is AI still set to uh continue attracting that capital and crypto just has to deal with it and uh find other ways to attract, interact investors itself?
00:16:47.200 --> 00:16:53.600
Yeah, no doubt it's definitely taken uh not only capital uh but attention as well.
00:16:53.759 --> 00:16:54.000
Yeah.
00:16:54.159 --> 00:16:57.120
Uh and I think that um, and that's a fact.
00:16:57.279 --> 00:17:02.559
Whether it's we're I mean, whether AI is in a bubble is also another million dollar question.
00:17:02.639 --> 00:17:04.720
There's so many theses out there.
00:17:04.880 --> 00:17:07.599
I think that uh look, it's still got room to run.
00:17:07.680 --> 00:17:10.319
I think that um there's still a lot of juice in the market.
00:17:10.400 --> 00:17:12.480
We've still got a lot of the biggest IPOs.
00:17:12.640 --> 00:17:16.640
I mean, although you think SpaceX was large, the biggest IPOs still haven't hit the market.
00:17:16.720 --> 00:17:22.640
Like Anthropics coming to the to try and do a two trillion dollar IPO, right?
00:17:22.960 --> 00:17:24.640
Now, that's mad, right?
00:17:24.720 --> 00:17:32.960
And like you can't obviously some of that capital will have to come from plays from allocators that may have wanted to invest in crypto.
00:17:34.000 --> 00:17:52.880
And then there's also open AI coming, and there's all the other ones that are that they're trying to come this late stage in the AI trade, all these large private companies and the and the labs and the uh and so many of the other infrastructure plays and data center providers are trying to come to market and get some of their exit liquidity from the public markets, right?
00:17:53.200 --> 00:18:01.519
So uh it's still going to it's still going to weigh on attention uh in the next in the next few months and draw some capital that could have gone to crypto.
00:18:01.759 --> 00:18:10.480
Then I guess the question is, okay, if we do have a situation in which the AI trade rolls over and it collapses, I don't know, man.
00:18:10.559 --> 00:18:15.519
It's difficult to see a world in which people are going to drive, then allocate back into like altcoins or something, right?
00:18:15.680 --> 00:18:22.000
Because there is so much is actually, and it's actually there's so much that is built into that AI trade.
00:18:22.160 --> 00:18:39.119
It's not just on the side of capital uh and and asset prices, but the entire the US economy, like if you look at how where the growth has come over the past uh you know, over the past few few few years, like few months, it's mostly been the AI build out, right?
00:18:39.440 --> 00:18:41.200
Uh so there's so much built into that.
00:18:41.279 --> 00:18:46.960
So if that AI trade turns, you know, rolls over, uh, that calls into question a lot of things.
00:18:47.200 --> 00:18:53.839
I think though, if you if we are gonna have that, that will obviously lead to a massive collapse in the stock price and in the indices, right?
00:18:53.920 --> 00:18:57.680
Because so much of the indices are made up of these AI names.
00:18:57.759 --> 00:19:01.279
Uh and you'll have a massive collapse in in portfolios.
00:19:01.359 --> 00:19:12.640
And um but I think in that environment, so you have, let's assume it's even impacts on the economy as well, because the economa the economic slowdown begins because that you don't have the AI build-out anymore.
00:19:12.799 --> 00:19:22.720
I think this is still an an environment in which hard assets, like which of which Bitcoin is one of the Bitcoin and gold are one of the prime examples, will benefit.
00:19:22.880 --> 00:19:28.079
Uh they will be the ultimate risk-off hedge and the escape from that that roll-off, that, that rollover.
00:19:28.400 --> 00:19:35.039
Old coins, yeah, I mean, it's a bit more, I think they're more on the side of the risk-on spectrum of asset allocation.
00:19:35.359 --> 00:19:37.200
Yeah, and just on gold as well.
00:19:37.279 --> 00:19:43.200
I mean, how do you see the relationship between Bitcoin and golds going in the coming years?
00:19:43.440 --> 00:19:55.440
Um, you know, like there's more and more argument now for just Bitcoin going into that store of value run as opposed to defining ways around its use as a currency.
00:19:55.680 --> 00:19:59.039
So, you know, do you see that that relationship going together?
00:19:59.279 --> 00:20:02.319
We saw golds go to all-time highs earlier this year.
00:20:02.400 --> 00:20:04.319
A lot of people expected Bitcoin to follow.
00:20:04.480 --> 00:20:05.759
It didn't follow.
00:20:06.000 --> 00:20:10.480
Um, so how do you see that relationship kind of developing over the coming years?
00:20:11.200 --> 00:20:22.160
Yeah, so I think the relationship uh as at least the correlation itself um hit an all-time hit a near or near high about a week or two ago, probably like a month ago.
00:20:22.400 --> 00:20:31.839
As I mentioned at the beginning of the the stream, that uh we saw gold and bitcoin both rally at about the same time on the back of the buybacks announcements.
00:20:32.240 --> 00:20:44.559
Uh so um I think there is this consensus in the market that if you're looking for a debasement uh de-dollarization trade, a hedge against inflation and the financial repression I mentioned, it's gold and Bitcoin.
00:20:44.799 --> 00:20:53.680
And they have the same, many same qualities, you know, limited in supply, uh, hard money characteristics, uh uh not easy to be seized.
00:20:53.759 --> 00:20:59.599
Uh you know, if you if you hold it, it's not you know financializing the financial system, so you can actually hold it yourself.
00:20:59.839 --> 00:21:02.559
That's why Bitcoin and gold are viewed in that same bucket.
00:21:02.720 --> 00:21:17.359
Of course, they each have their unique um you know characteristics that over one over the other, but I think it makes sense to have both in the portfolio if you do believe we're going into this world of negative real rates, high inflation, lower um financial oppression, etc.
00:21:18.160 --> 00:21:18.640
Awesome.
00:21:18.880 --> 00:21:24.079
Now, um, I wanted to talk to you as well around what narratives within the crypto industry you're most bullish on at the moment.
00:21:24.240 --> 00:21:28.559
Obviously, there's a lot of buzzwords with AI agents, there's the RWAs.
00:21:28.720 --> 00:21:36.640
Um, you know, like for yourself, what what particular sector right now are you most bullish on in the industry over the coming 12 months?
00:21:37.200 --> 00:21:42.960
In the I think it's around the strongest narratives or those that uh we see a lot of adoption going on right now.
00:21:43.200 --> 00:21:54.160
So I think RWA tokenization is a big one, especially as it relates to potentially around uh the uh how it uh you know, the intersection with that and AI.
00:21:54.240 --> 00:22:01.599
And then that is what, for example, specifically as it relates to AI tokenization tokenization of uh AI agentic payments.
00:22:01.759 --> 00:22:15.359
So we had the um yesterday, I think yesterday we had a report from BlackRock that broke down why uh you know digital like like the FAI agents are making payments on making payments to each other, it makes sense for them to do it on-chain.
00:22:15.440 --> 00:22:26.000
And that's why I think stable coins and the stablecoin infrastructure is an important narrative for you know adoption that we've seen go on in the next uh over the past few months and increasingly forward.
00:22:26.240 --> 00:22:34.160
And then there's also I think uh adoption around, I think about like what people are using crypto for these days and block and blockchain Rails.
00:22:34.240 --> 00:22:36.000
I think it's uh speculation.
00:22:36.160 --> 00:22:45.519
And one of the best, one of the biggest speculation plays right now, I think, is perp taxes, and of which the leader in that category is hyper liquid.
00:22:45.680 --> 00:22:48.559
So hyper liquid is doing well, it's near all-time highs.
00:22:48.720 --> 00:23:00.319
There is massive adoption, it's basically giving uh uh like proper stock trading venues a run for their money in terms of volume, and that adoption is just going sky high.
00:23:00.480 --> 00:23:04.799
And there's they're also engaging with uh they're engaging with regulators as well.
00:23:04.880 --> 00:23:10.559
I believe there's talk going on between uh uh you know the regulators, the CFTC, and the likes of Hyper Liquid.
00:23:10.640 --> 00:23:15.440
And I think Trump even mentioned Hyper Liquid in his um conference two weeks ago.
00:23:16.160 --> 00:23:18.000
Yeah, no, he mentioned hyperliquid.
00:23:18.319 --> 00:23:19.920
He gave a shill to hyperliquid.
00:23:20.319 --> 00:23:32.960
He did, and so like everyone in crypto, honestly, and I say this, you know, a little bit on the streams, like every episode with crypto executives, you can't get through 30 minutes without them bringing up hyper liquid.
00:23:33.119 --> 00:23:40.559
Like there's times where they don't bring up ETH, Solana, XRP, but hyperliquid is always brought up in in some way.
00:23:40.640 --> 00:23:41.519
It's it's crazy.
00:23:41.599 --> 00:23:48.319
Like, I don't think there has been an episode in like the last six months where it's the consensus trade.
00:23:48.400 --> 00:23:49.359
It's the consensus view.
00:23:49.599 --> 00:23:55.359
I think it's like it, and also it's right, it's the adoption we've seen take place within it, and people are using it.
00:23:55.440 --> 00:23:57.519
Uh, there's the fees being generated from it.
00:23:57.599 --> 00:24:00.319
So it's actually uh uh from a fundamental perspective.
00:24:00.400 --> 00:24:04.720
If you want to do a fundamental analysis on it, it's actually a protocol generating revenue.
00:24:04.880 --> 00:24:08.880
So that's important for many people who view assets through that lens.
00:24:09.039 --> 00:24:12.160
Uh, and it's you know become an institutional name now.
00:24:12.240 --> 00:24:16.160
I mean, people are using hyperliquid as a primary venue for trading 24-7.
00:24:16.319 --> 00:24:21.119
I mean, people are like if on the weekends, if you want to trade oil, can't do that in the traditional markets.
00:24:21.200 --> 00:24:26.880
People that can also use it as a method to kind of like get a sense of where markets are moving in the aftermarket hours.
00:24:27.119 --> 00:24:30.000
So that that's seen a massive adoption and traction.
00:24:30.160 --> 00:24:39.920
I think obviously we've also seen uh Zcash rallying past all-time highs um that we saw previously and just not stopping.
00:24:40.079 --> 00:24:45.440
And I think that is around this real demand for uh you know a private version of Bitcoin, right?
00:24:45.519 --> 00:24:49.599
And I think that they've captured that narrative uh well.
00:24:49.759 --> 00:24:59.200
And they have the right they have people back in it in terms of like who have reach and they obviously are you know singing its praises, which is helping to get its attention.
00:24:59.440 --> 00:25:05.440
But I also think there's some Bitcoin OGs who really who do believe in it uh and are allocating towards it.
00:25:05.759 --> 00:25:19.680
So that's another narrative which at least the privacy narrative itself is strong because we know we go, you know, on-chain privacy doesn't exist unless you're using technology like Zcash to kind of like keep your your currency and your your coins fully private.
00:25:19.920 --> 00:25:27.119
So I think that that's another narrative that I feel can one can be bullish on going if we're going to have some sort of an altcoin research resurgence.
00:25:27.519 --> 00:25:42.880
I had um Zach from Grayscale on the other week, and he was saying that the crypto market is still underestimating privacy tokens, uh, you know, despite Zcash where it is now, there's still that uh feeling that there's not been that mass allocation yet.
00:25:42.960 --> 00:25:44.000
So, what's your views on that?
00:25:44.079 --> 00:25:48.160
Do you still think there's a lot more upside there for tokens like Zcash?
00:25:48.400 --> 00:25:48.880
I think so.
00:25:49.039 --> 00:25:49.440
I think so.
00:25:49.599 --> 00:26:00.720
I mean, I think that um because at the end of the day, uh people are now realizing fully that, you know, Bitcoin, uh, Ethereum, all these on-chain currencies aren't fully private.
00:26:00.880 --> 00:26:05.359
In fact, they're probably even inferior to the likes of cash, right?
00:26:05.680 --> 00:26:12.400
To the extent that they can be uh that you can track, you can track people's, you know, transactions, right?
00:26:12.640 --> 00:26:28.480
And now more and more people are realizing that this is something that uh is an issue for financial privacy uh in the world where you have a lot of these stories about people getting uh you know kidnapped for their crypto and their personal digital identities getting shared online.
00:26:29.039 --> 00:26:30.799
Uh and uh I think that that's important.
00:26:30.880 --> 00:26:37.440
And I think there's no other one of the best ways to shield yourself from this is to invest in privacy coins, right?
00:26:37.599 --> 00:26:41.279
And um, that's what Zcash and Monero uh offer.
00:26:42.000 --> 00:26:47.920
So yeah, I think that's it's is definitely something that I think many people will wake up to if they haven't already.
00:26:48.319 --> 00:27:02.319
And um just the final point, Nick, is before we did talk around hyperliquid, I guess with all the bullishness that's around hyper liquid, all the executives that think it's amazing, um, what do you think is a potential bear case for a hyperliquid?
00:27:02.559 --> 00:27:03.359
Yeah, okay.
00:27:03.440 --> 00:27:07.039
So one bear case I think is around, again, regulation, right?
00:27:07.200 --> 00:27:27.920
So if you do have uh there is the questions around uh if we do have a change of guard from in two years' time and you have a you know CFTC chair who views this as kind of like competition for the likes of the CME and the regulated venues, uh, could they, you know, essentially limit, uh restrict access to it, access to it in the US?
00:27:28.079 --> 00:27:29.759
Could they take it to court or something?
00:27:29.839 --> 00:27:36.319
That is, if by by the rule of the law, you know, they could have a case for it in terms of like it's not a regulated venue.
00:27:36.480 --> 00:27:37.759
So that's one thing.
00:27:38.000 --> 00:27:43.759
Um and there's always massive tail risks like black swans that people don't anticipate, right?
00:27:43.920 --> 00:27:49.039
I mean, uh uh what happens if you have a massive hack of hyper liquid, right?
00:27:49.119 --> 00:28:02.480
I mean, I recall I recall that um a year ago uh there was the questions around whether North Korea was sniffing around in uh hyper liquid trades and everything, and that led many people to question how how secure it was.
00:28:02.640 --> 00:28:04.319
But I think those are the only real risks.
00:28:04.559 --> 00:28:04.880
Awesome.
00:28:05.039 --> 00:28:07.359
Nick, thank you very much for joining us on the show, man.
00:28:07.440 --> 00:28:07.920
Appreciate it.
00:28:08.079 --> 00:28:08.880
No worries, Kieran.
00:28:08.960 --> 00:28:09.519
Thanks for having me.
00:28:09.599 --> 00:28:10.640
Appreciate it.
