ROLLUP: Crypto Pain Market | Coinbase Super Bowl Rug Pull | IBIT Liquidation Cascade | Prediction Markets Explode | BlackRock x Uniswap

Summary

Bankless Podcast Episode Summary

Title: ROLLUP: Crypto Pain Market | Coinbase Super Bowl Rug Pull | IBIT Liquidation Cascade | Prediction Markets Explode | BlackRock x Uniswap
Hosts: Ryan Sean Adams & David Hoffman
Date: February 13, 2026

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Overview

This Bankless Rollup is a dense, energetic overview of crypto's latest week—a period marked by extreme market pain, a controversial Coinbase Super Bowl ad, the explosive rise of prediction markets, blowups in price action, and major TradFi (traditional finance) and DeFi (decentralized finance) crossover moments (most notably, BlackRock's tokenized fund live on Uniswap). The hosts dissect sentiment shifts, the role of new products, arguments about crypto's cultural moment, and what cycles mean for the future.

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Key Segments & Discussion Points

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1. Super Bowl 2026: The Coinbase "Rug Pull" Ad

[00:04–07:46]

Discussion:

• Only Crypto Ad in 2026 Super Bowl: Most ads were AI-focused; Coinbase stood out by using a Backstreet Boys song for a "rug pull" style reveal.
• Reactions: The ad started with "Backstreet’s Back" karaoke, then abruptly cut to "Crypto is for everybody" with the Coinbase logo.
  • Both hosts felt "got" by the ad—the attention-grabbing worked but left mixed feelings, especially among non-crypto natives.
  • Ryan Sean Adams: “I looked around…they all groaned, right. They looked at me, right? Because I'm like, I'm crypto.” [02:30]
  • David Hoffman: “Universal dissatisfaction, unhappiness with getting quote, unquote rugged about the ad.” [02:57]
• Meta-Analysis:
  • The public’s perception of crypto is negative in 2026 (“the PR is the worst since FTX”), making it hard for even optimistic messaging to land positively.
  • Reflecting on previous years: 2022 Super Bowl’s crypto ads were seen as more optimistic and future-facing.

Notable Quote:
“Crypto, at least in a pop narrative perspective…doesn’t have a thing…it doesn’t have in the popular consciousness a purpose, a broader purpose that it is solving for.”
—Ryan Sean Adams [05:34]

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2. Market Bloodbath & Sentiment

[07:47–14:02]

• Crypto Down Bad: Market is -15% from the week prior, with BTC at $66K (-5%), ETH at $1,900 (-7%).
• “Generational Bottom” or “Cooked”: Debating if this is a low for major accumulation or if the space is truly in existential crisis.
• Market Cap Perspective: Total crypto market cap has halved from $4.2T to $2.34T.
• Post-FTX Sentiment Worse:
  • David: “This feels so much worse than FTX.” [12:38] — because “we had external enemies to blame before…now this feels endogenous.”
  • 2022’s crash felt accidental, now it feels like the juice has been squeezed out and the lack of new, organic growth “feels helpless.”

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3. The Friday Crash: IBIT Liquidation Cascade

[14:03–19:27]

• Magnitude: Described as "the mother of all dips"—possibly “the third or fourth worst day for Bitcoin this decade.”
• Theories & Causes:
  • Potential forced liquidations in TradFi spilling into crypto (especially via BlackRock’s IBIT—record $10.7B traded that day).
  • The hosts speculate a TradFi player leveraged against several asset classes may have been liquidated, triggering a BTC collapse.
• ETFs Dominate Price Discovery:
  • “The trad market is bigger… the dog did wag the tail and we are the tail in this circumstance.”
    —David Hoffman [17:36]

Notable Quote:
“Because IBIT and because Bitcoin crypto assets are so tied into the rest of the financial system, we just took a volatility extreme hit…”
—Ryan Sean Adams [17:23]

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4. Reasons for Crypto’s Bad Year

[17:56–19:27]

• Alex Krueger's list: hangover from previous failures, distraction by AI, institutions crowding out OGs, oversupply of coins, political uncertainty, and new Fed appointments with hawkish stances.
• Sometimes, “it’s just the four-year cycle.”

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5. Prediction Markets Explode

[19:27–34:51]

Growth Stats and Trends

• Robinhood’s Success:
  • Q3 to Q4 annualized revenue from prediction markets up 4x: $115M → $435M. [26:19–26:37]
  • 11% of Robinhood’s revenue now comes from this new product.
• Super Bowl Volume:
  • $1.33B in Super Bowl betting—10x what Vegas did, per social reports. [27:41–27:53]
• Participants: Robinhood, Kalshi, PolyMarket—now major competitors.

Controversies:

• Insider Trading:
  • Challenged by mainstream media; Kalshi’s founder explained CFTC regulations apply at the same level as NASDAQ/NYSE. [29:14]
  • David: “There’s probably a lot more gray area, but more aggregate surface area for insider trading … when the promise of a prediction market is you can bet on anything.” [30:12]
• Regulatory Turf Wars:
  • States (like Nevada) vs. CFTC (federal regulation).
  • Chris Christie says prediction markets are unregulated, CFTC chair Mike Selig “strongly disagrees.” [31:57–32:09]
• Culture Clash:
  • Debate whether prediction markets are “truth machines” (market-driven, positive-sum) or just the “gamblification of society.” [34:09–34:51]

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6. Layer Zero, Robinhood, and "The New Chains"

[34:51–43:56]

• Layer Zero: Launching their own L1 (“Zero”), EVM-compatible, ZK-based, trying to “front-run the Ethereum roadmap.”
  • Parallels drawn to previous cycles’ “Ethereum killers” (Near, etc.).
  • Heavily VC-backed; skepticism about building network effect, but impressive backers from TradFi.
• Robinhood Chain:
  • Testnet launches—an Ethereum L2 meant to power a public, open developer ecosystem.
  • Ryan: “I'm pretty excited about it… Robinhood tends to execute well, get UX right…” [41:00]
• MegaETH/Aztec Token Launch:
  • New tokens launching with bear market discipline (lower valuations, higher lockups, less hype).
  • Ryan: “Some of these tokens are launching at some pretty low valuations.” [43:38]

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7. The Use-Case Debate: Is Crypto Only About Finance?

[43:56–47:47]

• Chris Dixon vs. Haseeb Qureshi:
  • Chris: Non-financial use-cases for crypto are still coming; policy and technical maturation will unlock them.
  • Haseeb: All scalable crypto use-cases so far are financial; "we shouldn’t propagate the ‘web2 meme’ about consumer use-cases.” [44:33]
• Proof in Talent Flows:
  • Farcaster (social) founders now joining Tempo (finance); Base de-prioritizing on-chain social for a focus on “tradable assets.”

Notable Quotes:
“Every single use case in crypto that has worked at scale has been financial in nature.”
—Haseeb (summarized by Ryan) [44:33]

"…if on-chain social or non-financial use cases of crypto have a chance, it's because we did the finance thing extremely thoroughly for a long time first.”
—David Hoffman [47:33]

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8. BlackRock x Uniswap: Tokenized Fund Goes On-Chain

[54:25–56:57]

• BlackRock’s BUIDL Fund Comes to Uniswap:
  • Permissioned (whitelisted addresses) security token traded on a permissionless AMM (Uniswap).
  • Legally, this is a regulated security—not just a Gensler “maybe.” [55:31]
  • BlackRock even bought UNI tokens to participate in governance.
  • Ryan: “In a bull market, things would be going bonkers… and it's barely a whisper, but is a pretty big deal long term.” [56:57]

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9. Mr. Beast’s Gen-Z Bank and The “Defi Mullet”

[57:00–59:15]

• Mr. Beast acquires banking app: Speculation over if/when crypto becomes integrated, especially via Tom Lee/Bitmine connection.
• Cultural Implication: “Content creators…getting deep into the financial sector…surprising.”

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10. AI Agents & Crypto Wallets

[59:15–61:04]

• Coinbase launches event-driven, agentic wallets for AI agents.
  • “What happens when Coinbase just spawns 1 trillion users with AI?” —David [59:54]
  • Hosts suggest next bull narrative may be “AI + crypto wallets”—and that even this is about financial use-cases.

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11. Scams, Crime & Pardons: SafeMoon & SBF

[61:10–64:45]

• SafeMoon Founder Gets 100 Months (8+ years):
  • “Crime is still crime. It just lags a little bit.” [62:11]
• SBF Propaganda & Pardon Rumors:
  • Unlikely, in David’s opinion, that SBF gets a Trump pardon. Polymarket odds would be low. [63:34–64:13]
  • Ryan worries the narrative is reversing and that “law” becomes optional for the powerful.

Comic Relief:

• The story of the missing 12-inch tungsten cube from the FTX offices—a symbol of the excesses and absurdities of the last cycle. [64:28–65:43]

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Notable Quotes

“This feels so much worse than FTX. We had enemies to blame…now this feels endogenous.”
— David Hoffman [12:38]

“Crypto…doesn’t have in the popular consciousness a purpose, a broader purpose that it is solving for.”
— Ryan Sean Adams [05:34]

“The trad market is bigger… the dog did wag the tail and we are the tail in this circumstance.”
— David Hoffman [17:56]

“Imagine you stumble into a new product…that adds 11% of revenue."
— David Hoffman on Robinhood’s prediction markets [27:01]

"Every single use case in crypto that has worked at scale has been financial in nature."
— Haseeb, highlighted by Ryan [44:33]

“If BlackRock’s doing it, everyone’s gonna do it.”
— Ryan, on securities traded on Uniswap [56:10]

“Crime is still crime. It just lags a little.”
— David Hoffman, re: SafeMoon [62:11]

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Timestamps for Key Segments

• Super Bowl Coinbase Ad: [00:04–07:46]
• Market Review & "Generational Bottom": [07:47–14:02]
• Friday Crash & ETF Liquidations: [14:03–19:27]
• Prediction Markets Segment: [19:27–34:51]
• Layer Zero, Robinhood Chain & Rollup Competition: [34:51–43:56]
• Use-Case Debate (Finance vs. Non-Finance): [43:56–47:47]
• BlackRock x Uniswap News: [54:25–56:57]
• Mr. Beast Bank: [57:00–59:15]
• AI Agentic Wallets: [59:15–61:04]
• SafeMoon & SBF Pardon Segment: [61:10–64:45]
• Tungsten Cube Story: [64:28–65:43]

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Tone & Style

• Conversational, witty, irreverent but always in-depth.
• A realist edge given the ongoing “pain market” with moments of nostalgia, debate, and cautious optimism.
• Hosts balance technical explanations, cultural analysis, and humor.

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Bottom Line

Crypto is in the throes of a bear market, with users and traders feeling existential malaise, but underlying structural innovations (like prediction markets revenue, permissioned securities on DeFi rails, new chains and AI integrations) hint at industry resilience and adaptability. The existential question of “what is crypto for?” hangs in the air, as does the specter of regulatory, cultural, and technological change.

This episode is a must-catch for keeping up with market mood, narratives, and under-the-hood developments that may define the next upcycle––whenever it may arrive.

Transcript

[Ryan Sean Adams]

Bankless Nation is the second week of February. We got the super bowl behind us. Dave, did you watch some of those commercials?

[David Hoffman]

I did. I did watch the commercials, yeah. Oh, I think I know. Are we about to watch a commercial?

[Ryan Sean Adams]

I think this was the only crypto commercial that was actually at the Super Bowl. Is that right? There's a lot of AI commercials.

[David Hoffman]

That's right.

[Ryan Sean Adams]

Okay.

[David Hoffman]

That's right.

[Ryan Sean Adams]

Here is the reaction. This is from somebody's living room, a reaction to the Coinbase commercial. Backstreet Boys. This is Backstreet's back is what they went with. Here. It is.

[David Hoffman]

So loud.

[Ryan Sean Adams]

Yeah.

[David Hoffman]

Everybody rock your double bird. Oh, did you watch this live?

[Ryan Sean Adams]

Yeah, I watched this live.

[David Hoffman]

I also watched it live.

[Ryan Sean Adams]

Okay, so who were you with? Were you with family, friends?

[David Hoffman]

Yeah, it was me and. Me and a friend.

[Ryan Sean Adams]

Okay, so what was the reaction around you when. So first of all, the commercial, obviously you guys saw that, but it starts with Backstreet Boys. Really reels you in. Right. The lyrics are on the screen. Very simple.

[David Hoffman]

You also don't know what's going on. He's like, oh, we're doing karaoke. We're doing Backstreet Boys karaoke. Don't know who this is. Don't know what's going on, but I'm down for it.

[Ryan Sean Adams]

Grabbed everyone's attention. Roped them all in because it was.

[David Hoffman]

A little side, which is why it was attention grabbing.

[Ryan Sean Adams]

That's right. Okay, so what was the reaction when the lyrics faded out and Coinbase popped up there? Crypto is for everybody.

[David Hoffman]

Like, my. My reaction was like, oh, okay, all right. Like, even I, like, felt got. I felt got you.

[Ryan Sean Adams]

Did you feel rug pulled?

[David Hoffman]

You feel a little rug pulled? Yes, I felt. Well, like it's. For me, it's Coinbase until, like, you know, thumbs up from me.

[Ryan Sean Adams]

You feel good about that.

[David Hoffman]

But I. But, like, you know, if my. If my perception of Coinbase was negative or if my perception of crypto was negative, I would indeed feel rug pulled. You just like I said, I felt got. But then I realized that, like, this is. They're. They're, you know, they're doing a little switcheroo.

[Ryan Sean Adams]

The watcher, Yeah, I felt got, but in a. In a way that was like, oh, well played. Like, you got you well played, Coinbase. But then I looked around and again, because that's because I'm crypto favorable and I have a fun.

[David Hoffman]

Appreciate Coinbase, Crypto, all that stuff.

[Ryan Sean Adams]

Everyone in the room, I was with. So I was with my family, and they all kind of looked at Me. And they all groaned, right. They were all like, ah. They looked at me, right? Because I'm like, I'm crypto. So do you think this was a good ad or not? There's. There's a lot of back and forth on crypto this way and like, we can't. It was a good ad from the perspective of it attracted everyone's attention.

[David Hoffman]

There was big discussion afterwards about everyone.

[Ryan Sean Adams]

So undoubtedly that is true.

[David Hoffman]

But it was undoubtedly a negative reception about the ad. Like universal, essentially universal dissatisfaction, unhappiness with getting quote, unquote rugged about the ad. Is that bad as a whole? Like, I saw Brian Armstrong's tweet about it. Like, you know, we wanted to create a universal moment where everyone is singing together in this one moment. And that's like emblematic of crypto. Like, get everyone onto the same system, upgrade the system, get everyone on board together, get everyone on the same ship. And we just wanted to provide that moment to the viewer. And I'm like, okay, that's a very naively optimistic interpretation of what could happen in reality. I think, like, Coinbase shouldn't be naive about the state of crypto PR in 2026. It's not great. Potentially, it's the worst ever since FTX.

[Ryan Sean Adams]

Yeah.

[David Hoffman]

And I think. I think that was, like, understood in the ad itself where, like, they needed to rug pull people in order to get them on board. So first they got them on board. They leveraged the Backstreet Boys.

[Ryan Sean Adams]

Yes.

[David Hoffman]

To get everyone on board. Because who doesn't like the Backstreet Boys? You know, millennials are. Are of the main consuming age. And. And then they yoinked them. And I think. I think you can't really say that. Like, the Coinbase marketing team didn't know what they were doing when they tried.

[Ryan Sean Adams]

To do this strategy, like in a box. The whole thing works. It's just kind of a timing thing. And the other contrast point, I'll say is when crypto was big at the super bowl last time, I think that was like 2022, right? It was a February of 2022. Yeah. And Coinbase had a commercial there. It was actually similar to this. So they kind of ran that playback because that was effective. FTX had a fantastic commercial. Crypto.com did a matt Damon thing.

[David Hoffman]

What's his name? The guy from Larry David. Larry David, yeah.

[Ryan Sean Adams]

Yeah. Great.

[David Hoffman]

It was a fantastic Larry David ended up on top on that one because his whole bit was like, I'm never wrong about this stuff. And I don't think crypto Is real.

[Ryan Sean Adams]

Yeah.

[David Hoffman]

And so he was just like nagging ftx, which ended up being great for him.

[Ryan Sean Adams]

But the nice thing about that ad, and of course FTX turned out to be the largest rug pull of all. Rug pulls like absolutely terrible for anyone who watched it and actually opened FTX account. So that aside. But that ad was about the change that crypto was bringing about. There was something positive about that ad and there's something forward looking about how crypto can change the world. Like great inventions.

[David Hoffman]

There were no optimism in the ad.

[Ryan Sean Adams]

Yeah. And this didn't have that. Not to say that if you played that same ad, like there's no way it would work in 2026 in this climate either. Yeah. It's just like, I think there's a meta point here of crypto, at least in a pop narrative perspective. And what is the super bowl if not it's popular cultural narrative is it doesn't have a. It doesn't have a thing. It doesn't have a, in the popular consciousness, a purpose, a broader purpose that it is solving for. And crypto people are like, but money and store of value and bankless future. But the public no longer believes that and does not believe it at this current flashpoint in 2026. And I don't think that's Coinbase's fault. Nope. Maybe you could say at some level it's crypto's fault, but I don't even know. It's just the point in time.

[David Hoffman]

It's what we are. It's the cards.

[Ryan Sean Adams]

It's what we got.

[David Hoffman]

The cards.

[Ryan Sean Adams]

At this point in time, it is.

[David Hoffman]

Worth saying that like every other Coinbase ad that I've seen has been a banger in terms. Not, not the last super bowl ad. The last super bowl ad. They just put a QR code on a screen and then everyone was like. It was also kind of a gotcha.

[Ryan Sean Adams]

Yeah.

[David Hoffman]

Of like just throw a QR code on the screen and then everyone's gonna scan it and then we'll just take them to the Coinbase download page on the App Store. And that was a gotcha. But like, I think people like that one. But all the other ads, the up upgrade the system ads, the, the ad about the farmer in Texas who is frequently hamstrung by his ability to pay people until he found Coinbase to use stable coins. Like inherently optimistic about the, you know, the long tail of America. The individual who's benefited by the permissionlessness and accessibility of crypto.

[Ryan Sean Adams]

That's right.

[David Hoffman]

And they're, they've always Been so good. The up.

[Ryan Sean Adams]

I think I would have preferred that this year. I think I would have preferred that.

[David Hoffman]

Preferred that because it would have been contra to the current PR understanding that society has about crypto.

[Ryan Sean Adams]

Crypto is gambling and rug pools. And.

[David Hoffman]

And then Coinbase could have come in and said, no, we are upgrading the system. The old financial system doesn't work for people. And. And here's our message of optimism and technological progress and we didn't get that.

[Ryan Sean Adams]

All right, this is David and I volunteering as advisors to the next big crypto marketing push at the Super bowl of 2027. We got to get to the weekly roll up, David. Crypto got absolutely demolished last week, down 15% and that was after being down something like 10%. What happened? Did we blow up? Is crypto completely cooked?

[David Hoffman]

And then Layer zero announces a layer one to challenge both Ethereum and Solana. Fed up with the slow progress of Ethereum, they're just doing it themselves, rolling their own code. Does layer 0 have a shot of entering into the top 10 top 5 chains of crypto?

[Ryan Sean Adams]

Prediction markets also reached new highs, partly due to the Super Bowl, I think. But some of this attention is not all good. There's some pushback, there's some incumbent controversy. So we'll talk about that. Also the Farcaster founders, they have now joined Tempo, the former Farcaster founders. I think this opened up a broader conversation about the end of non financial apps and use cases in crypto and whether we'll see them in the future or crypto is just meant to be finance.

[David Hoffman]

We'll get into all of that and more. But first a message from our friends and sponsors over at Rocket Pool who are launching their long awaited Saturn upgrade. This is essentially Rocket Pool V2. It's lowering the stake size, the bond size from Rocket Pool from eight to four, so you can get even more leverage on the yield of staking ether. You stake 4 ETH and run a node. Other people will come and say 28 ETH to make a 32 ETH node, but you charge all of them a fee. So if you want more eth yield, as well as to check out all the other features that are coming to Rocket Pool with this add an upgrade. You can check that out at Bankless CC Rocketpool. This launch is happening February 18th. Congratulations Rocket Pool and the Rocket Pool community for this upgrade. It has been a long time coming for the Saturn upgrade. It's finally here. It's pretty exciting.

[Ryan Sean Adams]

Absolutely OGs. But you want your staking upgrades to be very methodical and Slow, by the way, on staking. Did you see that? If as a percent of staking supply is now all time high. Yeah. It's above 30% now.

[David Hoffman]

It's destiny to go up only.

[Ryan Sean Adams]

Okay, well that seems good to me. That seems like it's conviction. People are staking. You know, they're, they're transferring from strong hands.

[David Hoffman]

No, we can't. To strong hands.

[Ryan Sean Adams]

Yeah, maybe there's some of that going on. Okay, well, it doesn't mean it's going to be pretty in the process though. Let's take a look at the blood in the numbers this week. So what's bitcoin showing us?

[David Hoffman]

Down 5% to $66,000. We're even dumping a little bit at the time of recording. Wow. $66,000 flat. Perfectly flat. Eth doing something similar. Down 7% to $1,900. Where we are right now. We do have what looks like a generational bottom on bitcoin, I think is. Is what it is called.

[Ryan Sean Adams]

Is that what it.

[David Hoffman]

Yeah, generational bottom. So bitcoin is in the bottom 5% of its entire price history relative to the 200 day moving average.

[Ryan Sean Adams]

Wow.

[David Hoffman]

And so we are in a 5% idiosyncratic moment. Whereas as you compare the current bitcoin price to the 200 week moving average, it is very rarely this low. So either is a generational bottom or we're cooked in like, you know, packing up.

[Ryan Sean Adams]

So the only two possibilities.

[David Hoffman]

Yeah, that's right.

[Ryan Sean Adams]

What are you going with? Are we cooked or generational bottom?

[David Hoffman]

Generational bottom.

[Ryan Sean Adams]

I'm going with that as well. This is Benjamin Cohen making an appearance and saying welcome back home. This is some sort of weekly average extrapolation that he likes to use. It's his kind of band, his rainbow type band. And you could see ETH is driving towards the bottom of the, of that band. But it's in kind of a long term ban since 2020, 2015. If you want to compare it this way.

[David Hoffman]

Ben Cohen was saying eth is going to quote, unquote, go home. This is a Ben Cohen meme. And return to that like regression band. And it did something like four or five months ago.

[Ryan Sean Adams]

Yes.

[David Hoffman]

And then we had him on to talk about that because like, this is a huge meme in the Ben Cowan universe that Eth is finally going home. Took way longer than he thought. Finally did go home and then we brought him on and then he, I remember him saying like, and then it's going to bounce back up and then it could go home again. And I'm like, damn it.

[Ryan Sean Adams]

Yeah, it's like a curse. And here we are, we are also at 2.34 trillion. So if you recall, what's the time we were at 4.2 trillion. So we've shed about 2 trillion on total crypto market cap. David I kind of thought we were going to get to 10 trillion this cycle and we didn't get there.

[David Hoffman]

Not quite. Definitely a narrow miss of 6 trillion off.

[Ryan Sean Adams]

We're going to talk about the big sell off that we saw last week, but I want to just get your vibe check on sentiment. So I've seen a lot of conversation about people saying crypto, people saying this feels worse than post FTX 2022. Do you think this feels worse? Do you think the sentiment is worse now in crypto than the last bear cycle? After all of the rug pulls and everything that happened then I think why.

[David Hoffman]

This feels so much worse than ftx. So Alex, you do think this so. Yes, I think, I do think this is. That FTX happened to us and it was like an unforced error that we felt like we still, well, we still have. With the power of Defi.

[Ryan Sean Adams]

Right.

[David Hoffman]

We still have so much juice left to squeeze with.

[Ryan Sean Adams]

We had enemies to blame.

[David Hoffman]

We had enemies to blame. It was like, well, this happened to us. You know, maybe we did the Terra Luna. Like, you know, there, there's these external reasons as to like why we are down bad right now. Yeah. But like that's just. Now we're just going to wait for D5 to mature even more and we're going to move, do more things and.

[Ryan Sean Adams]

Put more out of office.

[David Hoffman]

Yeah, all that stuff. There were like a ton of catalysts and now it's like this is on. This is just endogenous, like the price action. Why is this price action happenings? It seems to be because, I don't know, the world knows about defi. We've squeezed the juice out of Defi. Like we've, we've done a lot of the stuff and prices are where they are. And so I think it's like just a lack of control over the price. I think people feel a lack of agency over what the crypto industry itself can do to our own prices. And that feels helpless and, and I think that there's been just a broad lack of conviction or loss of faith in like some of the core premises of what crypto is, which is why it feels so bad.

[Ryan Sean Adams]

I get that and I think that's true. Although I will say every four years it's something.

[David Hoffman]

Yeah.

[Ryan Sean Adams]

And this Is just that something this time? Yep. You know what I mean? So I actually, I see that it's different in what the thing actually is that makes everyone bearish, but it was always going to be something in this time. It's like, oh, we have no one to blame. Like, you know, we had a kind of a weak cycle. Let's get into what actually happened on Friday because that was the mother of all dips. I think Jim Bianco said this was the fourth worst day this decade for bitcoin prices and I think actually it turned into maybe the third worst day. So Friday was worse than the FTX failure in 2022, worse than the terror in terms of price action, worse than the Terra Luna collapse, worse than the 2020 Covid shutdown in terms of daily percent changes here. David. So like what happened? Did something blow up?

[David Hoffman]

There are a handful of reasons. As I understand it, gold is a super volatile which is making the rest of the market very jittery. That's the sell off that we're happening right now. We're watching right now is gold and silver is getting pummeled. On the day of recording Thursday we had SAS apocalypse, which I didn't know. But bitcoin and crypto has been very tied to SaaS as a sector and there's worries about AI coming and disrupting SaaS. I think that's overblown. Jim Bianco also kind of thinks that's overblown. There's like weak labor signals as well. But there's like, if you're into reasons, there's probably plenty to find ultimately. I don't know, market's going down, market's going up.

[Ryan Sean Adams]

But I mean there was question this felt like for selling, we got on the Feeding Greed index to kind of like extract extreme fear territories. And people are saying the selling is looking like it's becoming forced, looking like it's becoming emotional. The Kobiasi letter said not Even the record 20 billion liquidation on October 10 came close to today. It appears that someone big was liquidated. So we see all of that and at the same time we saw Ibit, which is the BlackRock Bitcoin ETF with its highest volume day in history. That happened last week as well. So on that Friday, the day of the big crypto bitcoin sell off, IBIT secondary market trading hit a record volume of $10.7 billion. It's had lots of derivatives options trading against it as well. And that $10 billion in ibit trading, that is suspiciously big scale. Yeah. So part of the take here or a consideration is there could have been some tradfi type actors that were playing with lots of different instruments, maybe speculating on some of the, the assets that we just talked about, precious metals, gold, silver, we don't know where they were. They were. And they got liquidated, they got taken out in some way and they needed to liquidate some of their IBIT collateral in a hurry. And this caused a cascade. So it's possible someone was blown out or seriously damaged. And they weren't actually a crypto native company and firm, they were in Tradfi. And now because IBIT and because Bitcoin crypto assets are so tied into the rest of the financial system, we just took a volatility extreme hit along with some of that liquidation in tradfi assets.

[David Hoffman]

Yeah, price discovery, at least from what people can understand about this recent price action, Price discovery happened using the ETFs, not anything that happened. So it was kind of like, well, we are the smaller of the market. So it was like then the trad market is, is the bigger one. So you know, the dog did wag the tail and we are the tail in this circumstance.

[Ryan Sean Adams]

Yeah, I mean there's some that are now doing a retrospective on why crypto is having such a bad year so far. And people of course, corresponding to the 1010 slaughter. This is Alex Krueger. He's got a few things listed. There's a hangover from the digital asset treasuries, quantum fears which are, you know, maybe somewhat real. Maybe that's affecting things. The AI opportunity distraction, of course that's ongoing. The institutions and the swamp, he says, taking over and overcrowding OGs. So this pivot from cypherpunk and rebel tech, now it's all about TradFi and ETFs. An oversupply of coins. Trump and his kind of corruption and associated political risk. People are like, well, when the Democrats take charge, they're going to reverse all of these favorable crypto things. And he concludes that killed the momentum. And then came the nomination of Wash. And the market suddenly became deeply aware that Wash is a strong advocate of a small balance sheet. And so that was kind of the crushing blow for crypto. So as we said, if you want reasons, those are some reasons.

[David Hoffman]

There are some, There are some.

[Ryan Sean Adams]

And you can definitely, I guess, connect those dots if you want to. Another thing you could just say is it's a four year cycle and it.

[David Hoffman]

Was time random walk and random walks. We just randomly walked down and. And we are in a like top 5% extreme situation for bitcoin and perhaps you can take advantage of that.

[Ryan Sean Adams]

I, I am enjoying this, this Poly Market on the price of Bitcoin in 2026 and let's look at the odds that bitcoin falls below 50k this cycle. So 50k, the odds right now are 66%.

[David Hoffman]

That's really high. That's really high. 66% chance that we lose $16,000 off of bitcoin. The equivalent price in the other direction, 72% chance that it goes up to $80,000. Oof.

[Ryan Sean Adams]

Oof. So you can hedge, you can trade on bitcoin price on polymarket if you so wish. You can also like just think about setting buy ticks under 50k.

[David Hoffman]

Oh yeah, you can use Polymarket to inform your sync bids. Dude, there's $17 million of volume on this. I'm very interested in the increasing robustness of this as a financial instrument and if that's actually gets integrated into people's overall strategies.

[Ryan Sean Adams]

Yeah, I don't. Speaking of strategies, you know, strategy is actually using this dump to buy more. So I don't know if they're looking at Polymarket or what they're looking at.

[David Hoffman]

Are they using this dump to buy more or are they just buying more?

[Ryan Sean Adams]

They're just buying more. So their average price we mentioned last week, so their cost basis is 78k per Bitcoin, but it's higher than the price now. So they are underwater. So they got 5 billion in unrealized losses. And Michael Saylor is still buying more. He added $90 million worth of Bitcoin. This was actually Michael Saylor on CNBC when asked about his strategy here.

[David Hoffman]

If Bitcoin falls 90% for the next four years, we'll refinance the debt.

[Ryan Sean Adams]

Refinance where, Michael? We'll just roll it forward.

[David Hoffman]

I mean, again.

[Ryan Sean Adams]

But you think banks would lend to you at that point?

[David Hoffman]

Yeah, because the volatility of bitcoin is such that it's always going to be value.

[Ryan Sean Adams]

We'll just roll it forward.

[David Hoffman]

We'll just write it off. Let's write it off.

[Ryan Sean Adams]

I mean, people are worried. Some people are worried about this. I saw this clip played all over on my timeline that, you know, fear.

[David Hoffman]

Is in right now, Ryan.

[Ryan Sean Adams]

Yeah, yeah. I mean, I'm still not worried. I mean if like Michael Saylor specifically the debt that he has is just not insane. But I mean, if you had a lot of years below 50k bitcoin, then things look shaky, then things get in trouble.

[David Hoffman]

If we were truly cooked for good. If Bitcoin was cooked for good, then yes, Michael, tragedy. Michael Taylor is also cooked for good too.

[Ryan Sean Adams]

Yeah, Bitmine maybe in worse shape you could say. At least from an unrealized loss, relatively speaking.

[David Hoffman]

Yes.

[Ryan Sean Adams]

So bitmine has almost 8 billion in unrealized losses.

[David Hoffman]

A lot of millions.

[Ryan Sean Adams]

And yet David, Tom Lee purchased another hundred million dollars worth of ETH last week.

[David Hoffman]

Amazing.

[Ryan Sean Adams]

I don't know where he's getting this money at this point, but he is a net buyer which is frankly quite impressive. Also, Tom Lee Bitmind does not have the debt structure.

[David Hoffman]

Yeah, they have zero debt. They have zero debt.

[Ryan Sean Adams]

So I mean they should take on some debt. No one's going to lend to them in this environment. Not while fear is in. Lastly, a rare insight into Goldman Sachs crypto portfolio and here's how it breaks down. So Goldman Sachs apparently has $2.3 billion worth of crypto. So they are buyers. And here's how they split this. 46% Bitcoin, 42% ETH, 6% XRP, 5% Solana. Rate that portfolio. David, what do you think about that spread?

[David Hoffman]

I don't hate it. I hate 6% of it. I don't really care for the XRP but I don't know if I'm Goldman Sachs and maybe I'm into it. Yeah, I think that's great.

[Ryan Sean Adams]

Not a bad portfolio.

[David Hoffman]

There are many people with much worse portfolios than that.

[Ryan Sean Adams]

Yes, yes, I might be one of them. I'm not sure yet actually. All right, coming up next, David, you're going to tell me about prediction markets. They are on fire. And some of this news came from a Robinhood report that just shows how much growth prediction markets have had in the US this year. Also, Layer Zero launches an architecture. I think this is trying to front run Ethereum ZK architecture. We'll talk about all that and more. But before we do, we want to thank the sponsors that made this episode possible.

[David Hoffman]

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[Ryan Sean Adams]

That's great data actually to have ready. Yeah.

[David Hoffman]

In Q3 this is not, not the quarter that was being reported Q4 was being reported, but last quarter $115 million in annualized revenue. From Q3 of 2025 that grew to 435 million of annualized revenue.

[Ryan Sean Adams]

That is called product market fit. They have an audience for this.

[David Hoffman]

That is 11% of Robinhood's revenue this last quarter came from prediction markets. 11% on a brand new product.

[Ryan Sean Adams]

Up from 0%.

[David Hoffman]

Up from 0%. Imagine, imagine you stumble into a new product, you're already a massively like revenue positive business and you stumble into a new product that adds 11% of revenue.

[Ryan Sean Adams]

Incredible.

[David Hoffman]

Onto your. That. That is crazy. Okay. Robinhood controls 35 of U S Prediction markets by volume. There's some split there between them and Kalshi and then also Poly Market is in the game as well. And so we're just kind of seeing massive growth into. In, inside of. I'll call Robinhood an incumbent inside of an incumbent who are lever leveraging this as well. It's no, it's no surprise that Coinbase and even Gemini are all doing the prediction market stuff because it seems to be very revenue positive. And Ryan, one last thing on this. This is not the quarter that super bowl and March Madness volume is going to be reported. That will be next quarter.

[Ryan Sean Adams]

Wow.

[David Hoffman]

So next quarter is the. Is the super bowl and March Madness quarter.

[Ryan Sean Adams]

I saw this tweet. Prediction markets did 1.33 billion on the Super Bowl. Just the Super Bowl.

[David Hoffman]

Just the Super Bowl.

[Ryan Sean Adams]

And that apparently that's 10x what Vegas did.

[David Hoffman]

I don't know if the 10x versus Vegas is totally accurate because there might be, there might be apples to oranges there with volume in Vegas versus But. But nonetheless the growth isn't great.

[Ryan Sean Adams]

Incredible. Just for, for one event, the super bowl event. But so with the success, there's some pushback. I see pushback in three different maybe dimensions, but one of them is certainly this question about insider trading. This is a clip from CNBC interview with Kalshee founder. And the first thing, how are you making sure that as a marketplace you are limiting the impact of a person who has control over the bet that you're placing or that that you're offering, doesn't manipulate it either for their own gain by being able to place bets or being able to tell their friends and family what, what would go along with those lines. It's bizarre to me to be able to bet on these things and have someone who completely controls the outcome and you don't know if they're betting or if their friends and family are betting on it? Well, the insider trading risk is very real for a stock market as well.

[David Hoffman]

And has been real since the stock market has begun.

[Ryan Sean Adams]

I feel like we control that and we can trace it. The SEC can very quickly find out who profits by how much and they shut that down. Do you do the same thing on Kalship?

[David Hoffman]

We do the exact same thing on Kalshi.

[Ryan Sean Adams]

So as a regulated financial market by the cftc, we have the same rules as the NASDAQ and the NYSE and we have the same mechanism of enforcement.

[David Hoffman]

What I'm what's grinding my gears, Ryan, about a lot of the discourse from trad media and like the trad world about prediction markets is that they seem to be just giving an undue level of responsibility to managing insider trading to the platforms. Now like the platforms does, they do have some responsibility. And you know, Tarek from Kalshi said it like we are doing the same things that all the other platforms are doing. The difference is that there's probably a lot more gray area, but more aggregate surface area for insider trading to happen when like the promise of a prediction market is you can bet, bet on anything. And so you know, in, in equities markets or you know, commodities markets, there's more, it's more specific about when there is insider knowledge versus not. And with a prediction market where you can bet on anything, it's far more nuanced. But these are questions for the cftc. So I would like the squawk box found people, interviewers to stop pestering prediction market platform people who, who are doing the same thing as all these other venues and then go ask those questions to the cftc. We are bringing on Mike Selig, the new SCFTC chair and we will ask him those questions because that is the appropriate person to ask these questions to. In my opinion.

[Ryan Sean Adams]

This is a hot button political item. So, so one item is insider trading and sort of how do you deal with that? What does that look like in prediction markets? Another question is who gets to regulate it? And this is hot button because it feels very much there's a set of incumbents and these might be states United, like states in the United States of America, states like Nevada, maybe that House, Las Vegas versus the cftc, which is a federal entity and who gets to regulate these things? And then you have a set of incumbents who used to do things like sports betting versus the prediction markets which are allowing trading in all sorts of markets to include sports events, as we just saw. This is ex governor Chris Christie, obviously a political pundit. I believe prediction markets are violating the law. He says in 40 states we have regulated betting, a camp market to teenagers, pays state taxes, protects game integrity and reports suspicious activity to law enforcement. Prediction markets do none of that. So the charge here is that it's completely unregulated. The CFTC chair, Mike Selig, who you just mentioned, quoted this tweet and said strong disagree. So he's making the case that no, there, there is a regulator here. It's called the cftc, it's a federal regulator and we span all of the states in the union and we've got this and are handling it. So that's A hot button political issue at this point.

[David Hoffman]

I wonder if the future of prediction markets is going to get down to the granularity onto the prediction market itself. So like a prediction market like the one from Polymarket that we talked about earlier will, what's the probability that Bitcoin will be at $100,000 this year? That is a strict financial tool.

[Ryan Sean Adams]

That is pure cftc.

[David Hoffman]

That is a pure cftc.

[Ryan Sean Adams]

A hundred percent.

[David Hoffman]

What is the probability that a roulette ball will land on red? That's purely sports gambling, right?

[Ryan Sean Adams]

Well, I mean roulette is. Maybe that's. We already know the probability. But like maybe you're saying the probability of some sort of.

[David Hoffman]

But you could, you could put up sports bet. You could spin up a prediction market.

[Ryan Sean Adams]

Sure.

[David Hoffman]

To guess the probability. Like for example, here's a bet. Here's a better example. There was a very pretty high volume prediction market on polymarket about what the coin flip was at the Super Bowl. Heads or tails. Is that a financial instrument?

[Ryan Sean Adams]

I hope it was 50. 50. Right.

[David Hoffman]

Are we breaking some? Okay, thank God we're betting on it because you can bet on anything. So is that a financial instrument that should be regulated by the CFTC or is that sports gambling that needs to be regulated by the states? It's a case by case basis on the market. And I wonder if the future regulation is going to have to get that granular.

[Ryan Sean Adams]

Yeah, that's maybe. But I mean how good are governments and regulators in getting that granular? You need some broad principles I think in order to do something here. So there's the insider trading kind of hot button issue, incumbents versus disruptors. Other people I think see any of this, any markets as the Gamblification of society and they don't like it. I think a lot of your position with respect to prediction markets probably hinges on, we've said this before, how you feel about markets in general. So I have a net favorable view of markets in general. I think they are good mechanisms for organizing and coordinate society. For truth.

[David Hoffman]

Markets are tight.

[Ryan Sean Adams]

Yeah. If you believe in markets, you want to let the innovation go. Here you think a public good is being produced which is a truth machine. Not to say there won't be bumps along the way. There will be, but you fix those as they go. You kind of open things up. If you hate markets, if you do not believe in markets, you probably don't like prediction markets.

[David Hoffman]

If control, if you like rules and perhaps you lean authoritarian or central.

[Ryan Sean Adams]

If you lean, hey, centralized solutions will fix things, right? You, you think you see this as a public bad. You see this as more of gamble ification. So this is a societal level cultural debate as well. And it'll be interesting to see how this all shakes out.

[David Hoffman]

Yeah, it will continue to be a theme for the rest of this year. Let's get into some topics around some chains. A tale of three different chains Layer Zero Robinhood, Mega E Three different chains. Each one had news this week.

[Ryan Sean Adams]

Yeah. And I think they each have different strategies. So Layer Zero, it feels like they are trying to front run the Ethereum roadmap. Whereas the other heard that one before you, you have. The other two are doing some sort of, you know, roll up Type play gen gen 1 type roll up play or gen 2. So let's talk about what Layer 0 is doing. This kind of came out of nowhere it felt like, but they released this long architectural blog post essentially on Twitter and they were describing something called Zero, the decentralized multicore world computer World computer David. It's been a long time since we've heard that, but that is certainly how Ethereum came on the scenes. What this is of course Layer Zero is a, a bridge platform, bridge company. They have had a lot of success with respect to bridging crypto assets from one chain to another. That's what they're known for. Now they are getting into the layer one chain business. Some points of interest. This is a ZK EVM. So it's EVM compatible, uses risk zero, if you're familiar with that. Uh, it's an L1 as I mentioned. ZK proofs for verification. So it's very similar to the Ethereum roadmap in that you should be able to verify and run validators from consumer level hardware. That's what they are targeting here. They're doing things like Verkal Trees which is, you know, a little more distant on the Ethereum roadmap slot times low latency pre confirmations for users Mainnet in the fall using something called Jolt which is an A16Z ZK EVM. So what this reminds and this is.

[David Hoffman]

Developed by A16Z I think is worth highlighting.

[Ryan Sean Adams]

That's right, that's right. Developed by them. So this is smelling and sounding a lot like kind of Tempo in some ways. So Tempo again Paradigm produced client now Paradigm Talent sucking in a lot of talent from the Ethereum ecosystem and basically trying to front run the Ethereum roadmap. That's what I'm seeing with Layer zero. They're like hey, nice roadmap you have over there. ZK is Amazing. We're going to get to it faster than.

[David Hoffman]

It'd be a shame if somebody else didn't have all your tech debt and could move really quickly.

[Ryan Sean Adams]

Yes. And so that is exactly what they're doing. And they're also backed by an impressive assortment of companies and individuals. Do you see some of the launch partners here? Yeah.

[David Hoffman]

It kind of reminded me of our conversation with Canton. So it's, it's tempo in the sense of front running Ethereum to get to the end game faster. It's also seemingly like Canton, which is a lot of giving corporations their sovereignty over their own little region of the network in the same way that Ethereum has like, you know, Robinhood chain for a layer two, Citadel securities, the DTC ice, International Intercontinental Exchange.

[Ryan Sean Adams]

The ownership. Yeah, you get the right ICE for that one.

[David Hoffman]

Yes, the, the markets base ice. So kind of some of the biggest large partners that you could really ask for here as it relates to, you know, traditional market infrastructure.

[Ryan Sean Adams]

Do you remember back in. Was it 2018 or 2019? Near. Do you remember when near came on the scene?

[David Hoffman]

This is also. Yeah, reminiscent of Near. Like. Oh, like Ethereum is so slow. Let's. We're going to front run to the end.

[Ryan Sean Adams]

Yeah, exactly. We have the better engineers. You guys are a bunch of researchers. The theorem Foundation. We are executors. We're engineers and we're going to front run all of your great roadmap ideas. And near has since pivoted, I think, from that strategy. It's safe to say. Doesn't mean that this won't be successful.

[David Hoffman]

They kind of evolved their strategy, but they have left a lot behind. Yeah, sure.

[Ryan Sean Adams]

Reminds me of that. I mean, we see these archetypes each cycle, so the hard thing is going to be to bootstrap that network effect. And then what about the token itself? It's very much vc. It's. It's hard to make a case that.

[David Hoffman]

Doesn'T have the monitor unit either. The asset.

[Ryan Sean Adams]

That's right, that's right, that's right.

[David Hoffman]

And like you can't. We have seen before. I think what you're saying is we have seen before that you can't just build Ethereum in a, in an ivory tower and skip to the end. That's good. Like it's great if you can. But like the things that make Ethereum special are in addition to that.

[Ryan Sean Adams]

Well, what's notable is they weren't just talking about kind of being an Ethereum killer and all of Ethereum's failings, but they were also talking about Being a Solana killer as well. So I guess good for Solana for making it to the stage that you have killers coming after you.

[David Hoffman]

I mean, I think it is, it is the right position of a chain like this to say, hey, everything beyond Bitcoin, we're going for that.

[Ryan Sean Adams]

Yeah, I think so. Robinhood layer two.

[David Hoffman]

Yes.

[Ryan Sean Adams]

Now their testnet came out. David, what's this?

[David Hoffman]

So this is their long, long awaited Robinhood chain. Testnet is launched, has launched. So it's up and about. The important thing is, is that they are doing the public permissionless chain, the open developer ecosystem chain which is like alongside many of the other layer twos, alongside base. What I think is unique about this is how Robinhood intends to use this over Ryan. Since the start of this year we have talked about the New York Stock Exchange tokenization plan, we've talked about the NASDAQ plan to build out a blockchain based exchange. The Robinhood chain is from mine. Read on. This is their strategy to go toe to toe with those two gargantuans, those two incumbents, by producing an exchange as a blockchain, but as an Ethereum layer too. And so it's going to be this open developer ecosystem that we know of. It's going to have hackathons, they'll have presence at many of the Ethereum events, which I think is the unique thing and why I find Robinhood strategy more resonant than NASDAQ's or the new York Stock Exchange.

[Ryan Sean Adams]

I'm pretty excited about it actually. You notice the things that Robinhood does, they tend to execute on. So when they glom onto something new. We just talked about prediction markets, right? Suddenly prediction markets is fueling massive amount of their business. They tend to execute well, get UX right. They have a good idea as far as connecting some of these technologies to their end product. So I'm pretty bullish on that.

[David Hoffman]

There's also some pretty bullish hood. I'm pretty bullish.

[Ryan Sean Adams]

Yes, I know. By the way, were they up or down after the earnings?

[David Hoffman]

Very down, which was surprising and it continues to be down in this moment. But I.

[Ryan Sean Adams]

To buy more may that makes you. Yeah. More bullish on the downside then Mega Eth Mainnet also launched and the Aztec Token launched as well. The Mega Eth Mainnet seemed to go pretty well.

[David Hoffman]

Yeah, that's right. Yeah. There's been a lot of rabbling on the timeline that like it's not launching to big fanfare like chains of the past. I think people were really looking for a blast or Bear a chain type playbook where the chain, you cut the ribbon, all the apps open up. There's incentives everywhere. People are just like spraying tokens around. That's just not what's going on. Like read the room, guys. We have very few users in this present moment and also we've been talking about how indiscretionary token distributions have resulted in poor investment vehicles. And the strategy that I can tell from Mega Eth and its app ecosystem is to be highly discretionary on its token. And I wrote an article about this because like people were just giving what I felt were obsolete and outdated takes. There's, there's just a new playbook out there. Aztec is doing the same playbook too. They have a line here that I really, really liked. Every token holder of Aztec has a cost basis. As in every holder of Aztec purchased invested in the token. The launch price is being established by price discovery on the, in the public, no insider staking in the Aztec ecosystem. Plus 36 month insider lockups and then on chain liquidity doing it just hard mode.

[Ryan Sean Adams]

And these are bear market launches. These are bear market launches. And some of the best like ROIs in history have been in crypto history have been these bear market launches. You have to factor that in. But of course sentiment is against it when you look at the token price. So this is the Aztec token you're just talking about that they raised just even recently, 157 million. They're now trading in a $59 million market cap. 215 million FDV. That's, that's Aztec. Remember Zama as well?

[David Hoffman]

Yeah.

[Ryan Sean Adams]

They have launched $185 million market cap. Mega holding out a bit more at least on, on some of the futures market I think it was, do you say $1.8 billion, $1.3 billion.

[David Hoffman]

So it's 1.3 billion from the pre sale.

[Ryan Sean Adams]

Okay. Up 30% still from the presale. Still hanging onto that layer zero. Got a nice bump this week on layer two news.

[David Hoffman]

Doesn't look terrible.

[Ryan Sean Adams]

Two billion. But I'm just saying some of these tokens are launching at some pretty low valuations.

[David Hoffman]

We were once very upset about the high ftv low float meta. That is not what we're getting. We're getting the low FTV semi.

[Ryan Sean Adams]

Still high flow.

[David Hoffman]

Still high flow.

[Ryan Sean Adams]

Yeah, definitely. So I mean they crashed down to earth. It could be a good buying opportunity if, if one of these really survives and thrives post this, this market. Which brings to a question about what the use cases are for crypto there's this debate on crypto, Twitter primarily, I think between Chris Dixon, who wrote a post on the long game for crypto, and also Haseeb. Basically Chris's take is, yeah, use cases beyond financial use cases for crypto. They're not dead, they're just in the future. And we have been hampered and locked by being too early to some of these things. The policy was a missing piece. Previously he'd said cheap block space was a missing piece, but non financial use cases in crypto, the full story, that's full, that's intact. And Haseeb, he pushed back and he said, hey, you got to call us spade a spade. At this point in time, every single use case in crypto that has worked at scale has been financial in nature. I respect Chris's optimism, but 18 years in, we shouldn't be propagating this web 2 meme consumer use case meme. It's all about finance all of the.

[David Hoffman]

Way down this debate, which is a debate that we've been having in the weekly roll up for the last like three weeks. It's been the theme of the year so far. This one's downstream on the fact that the two far Farcaster founders, Dan and Varun joined Tempo. So you know, Tempo, the chain that's optimizing for stablecoins financial use cases is taking the two talent, the two lead talent from the on chain social use case, the two leaders and that's going into the finance world.

[Ryan Sean Adams]

So reallocating capital.

[David Hoffman]

Sign of the times. Yeah. And bas also removed the Farcaster social feat. So, so base. Remember how how Jesse Pollock was so aggressive and determined about getting on chain social and consumer creator coins as to be a thing. So they, they removed the Farcaster post from the. From the base tab. And so Jesse said the app needs to have one primary focus and that thing is trading.

[Ryan Sean Adams]

Trading.

[David Hoffman]

I was the biggest advocate for bringing Farcaster content into the base app and continue to believe in the multi client world. But we've realized we need to do less better by focusing on tradable assets. So base removing some of the the on chain social elements out of the app. And so you know, that brings us once again back to this debate, this time between Chris and Haseeb about like, is on chain social like a real thing or is it not a real thing? My, my take is that it's not.

[Ryan Sean Adams]

Just on chain social. Let's broaden that to use cases beyond finance.

[David Hoffman]

Use cases beyond finance. Yes. Yes. There's something in Chris, Chris's article that I really didn't like which is his line policy is the missing piece. And I think Haseeb appropriately called that out when he said does that really pass the smell test? Like my it just doesn't feel right like it I don't think we will get the Clarity act or what other other legislation we need through Congress and all of a sudden on chain, social or non financial use cases on crypto just will blossom like the the more moderate in between. Take that. I can agree with that Chris said, is that we need the financial use case of blockchains to proliferate for the next decade and we need wallets to get into the hands of more people naturally through UX improvements, products improvements and we just need the first wave of crypto to really mature generationally and then maybe we can talk about less financial use. But but there's a strict order of operations and in 2021 through 2023 we tried to build all of them in parallel. And if on chain social or non financial use cases of crypto have a chance, it's because we did the finance thing extremely thoroughly for a long time first.

[Ryan Sean Adams]

I pretty much believe that too. And I will point out though that Chris Dixon's read write own. He's saying that own is crypto. That's still right on. But own, that's a financial verb basically, right? I mean it's property rights. That's the core of things. And so I give more on Haseeb side of the argument certainly in the short to midterm. But I think some elements of what Chris is saying will turn out over the long run too. David, we got more to talk about. BlackRock teams up with Uniswap. Wow, that's so crazy. That would have blown my mind for you strategy. Also, Mr. Beast is launching a bank and the SafeMoon founder. I forgot about this guy. He got a hundred months in jail. We'll talk about all that more. But before we do. Yeah, it's a lot, a lot of months before we do. Got to thank the sponsors that made this episode possible.

[David Hoffman]

Hey Bankless Nation, it's David. If you're hearing this, that's because you are listening to the free Bankless podcast feed. Did you know that there is a premium Bankless RSS feed? The premium feed has extra interviews that I do for my own personal research and just deeper questions that I want answered about the crypto industry. Questions that I want to answer so I can be more informed as an investor both at Bankless Ventures and also just in my own personal portfolio too. Also There are no ads, which means if you listen to the premium feed instead of the free feed, you'll get about 20 hours of your life back every year because you choose to support Bankless directly. So if you're interested in getting extra content all while skipping the ads, or you just appreciate what we do here and want us to keep doing it, we'd appreciate it if you signed up for Bankless Premium and there is a link in the show notes to get started. Cheers to a good 2020 second. Few people in crypto put real skin in the game when they make public top or bottom calls. The Defi Report is one of them. The week before the October 10th flash crash, Michael from the Defi Report emailed his entire newsletter saying he's going aggressively risk off and sold the majority of his book from crypto into cash. This is when ETH was about $4,000 and Bitcoin was 110. Michael runs the Defi Report, an industry leading research platform built on data cycle awareness, risk management, transparency and most importantly, skin in the game. We like Michael at Bankless, we like his analysis and that's why you hear him on the Bankless podcast about once a month. And the Defi Report is giving Bankless listeners one free month of access to the Defi Report. So if you're looking for some sharp data driven analysis to make better informed decisions around your portfolio, you can learn why and how Michael called the top and what he's doing next all in the Defi Report pro. Check it out. There is a link in the show notes.

[Ryan Sean Adams]

So Vitalik has been on this milady arc, let's say where he ends these posts this year with m' lady and he's basically just saying, I'm saying what I feel like, you know, it's just, it's time for me to be uncensored. Okay. And so last week it was about layer twos and the strategy. We've talked about that. The one thing I was waiting for him to say that I feel like was not said but that he actually believed I tweeted this, I said the last say the quiet out loud thing I'd like to hear from Vitalik is that ETH is a store of value and one of the most important apps on Ethereum and he actually said it. So he repeated that word for word.

[David Hoffman]

David, I think he copied and pasted your tweet and then just used it. Used it as a.

[Ryan Sean Adams]

He didn't just copy and paste because he added a period here. So you see that's distinctly different so he put some effort into it. But he said ETH is a store of value and one of the most important apps on Ethereum. He's kind of said this before in some places, though not as explicitly and not tied together, that ETH is a store of value, it's a monetary asset, and it's also a, like the most important thing, one of the most important things on Ethereum. So it was good to hear him say. And the reason that's important for me is because I don't think eth's architecture and trade offs and all of the things that it's done so far make any sense. Unless you actually believe that. And I will kind of like, that's a hill I've chosen to die on. Right. Whether it becomes a consensus store of value or not, and whether it wins that race, wins that game, I can't say for certain. But all of the choices and the entire project doesn't make sense unless you believe that. And I had not heard Vitalik articulate that. And so now he has. I felt fulfilled by this tweet.

[David Hoffman]

Dave, there's been like two equivalent dispositions. One is that ETH is the greatest app on Ethereum because of all the choices that Ethereum has made. It has bestowed an incredible set of properties in the native currency.

[Ryan Sean Adams]

Yes.

[David Hoffman]

And then there's an equivalent but distinct disposition which is we need to do everything we can to the economic security of the network to preserve the properties of the network. And so it's a, it's a cart before the horse or like an order of operations thing. Where Vitalik previously, and maybe to this day it has been like, I don't care about Ether, but I will do whatever I need to do to Ether to protect Ethereum. And as it turns out, all of those things make Ether an incredible store of value. And so your disposition is like, let's put Ether first and talk about Ether as an incredible app. And Vitalik is like, eh, I just did what I needed to do to make Ethereum powerful. And you're like, that's the same thing.

[Ryan Sean Adams]

I agree. It's the same thing. And it's all part of kind of the yin and yang of this. I will just add. So I felt like the missing piece was the question of what is all this uncensorable, massively max, decentralized block space.

[David Hoffman]

For what are we doing here?

[Ryan Sean Adams]

What is it for? Why are we. Just tell me what it's for, clearly. Okay. And the thing that it's for is Ether as a store of value. Asset and all of the decentralized finance around that, that is the.

[David Hoffman]

That has been Ethereum will die, but there will still be Ether as a.

[Ryan Sean Adams]

Good solid store of value anyway, so that's mission mission accomplished. You know, almost six years into this podcast, David, we. We got that and pack it up. Yeah, so you pack it up. Also on this note was interesting this week, David, back to the L1. That movement is happening. So ENS, you know, the ETH extensions, they actually had a strategy to develop a layer two and they have now reverted back and they're saying the next version of their protocol ever after, it's going to be deployed on the layer one. We're going back to the L1, back to mainnet. The reason they gave is like Nick from ENS threw this out. He's basically like, gas fees are low, there's a scaling roadmap in place. It always made more sense for ENS to be on Ethereum. Vitalik backed that up and he said it's a good decision. ENS names and records are a form of state that's central to the Ethereum ecosystem. So they're staying on the L1. I would like to echo a point you made.

[David Hoffman]

ENS is staying on the L1. It's crazy that. That's crazy. The Ethereum name service is deciding to stay on Ethereum.

[Ryan Sean Adams]

Oh my God. We could have saved some more time. I was reflecting on part of your rant from our episode that we dropped last Saturday, which is just like we could have figured this out, you know, two years ago. Yeah. So much sooner and gave more clarity.

[David Hoffman]

But here we are now and wasted less capital and effort and labor.

[Ryan Sean Adams]

Yeah. In good news for adoption. This is a Hayden Adams saying this is a huge day for defi. Gotta agree. So Blackrock, the largest asset manager in the world, 14 trillion AUM, and Biddle, their tokenized fund, they are coming to Uniswap. What's happening here?

[David Hoffman]

Why is that a big deal? Is the first question. The first big question. The answer is that, you know, Uniswap is a permissionless amm.

[Ryan Sean Adams]

But.

[David Hoffman]

But Biddle, the token is not a permissionless token. You need to be. Your address needs to be whitelisted onto that token. So we have a security token, A security. A regulated security, an actual security. An actual security.

[Ryan Sean Adams]

Not a Gary Gensler.

[David Hoffman]

Not a Gary Gensler security. An actual security being traded through Uniswap. Which is pretty sick. It's pretty sick that we can do that. It's also pretty sick that Blackrock is doing it. Because that is not a trivial thing to do.

[Ryan Sean Adams]

Yeah.

[David Hoffman]

Like putting your security in a decentralized. Like the lawyers need to look at that in every way, shape and form. You know, like CZ style, spread the butt cheeks and they did it and they gave the thumbs. And so we have the lesson of BlackRock's lawyers that you can put securities into Uniswap which I think will make it do it.

[Ryan Sean Adams]

If BlackRock's doing it, everyone's gonna do.

[David Hoffman]

Anyone else can do it.

[Ryan Sean Adams]

You know the other thing they did though here, David, which is kind of cute and kind of good. BlackRock actually bought some uni tokens.

[David Hoffman]

All right.

[Ryan Sean Adams]

So they wanted to have. They jumped. They purchased. I don't know how much they purchased. Did you get. Did you get that?

[David Hoffman]

See how much? I don't know if it was disclosed. Okay. The on this news, the price of unique got a candle sword $3.30 all the way up. 25% candle all the way up to where to go $4.

[Ryan Sean Adams]

Yeah.

[David Hoffman]

To where then retraced back to $3.30.

[Ryan Sean Adams]

People were temporarily bullish on tokens again and then they forgot why they're. Why they're bearish.

[David Hoffman]

The bullish. The bullish the token bullish. Half life is so quick right now.

[Ryan Sean Adams]

I this is the thing though. BlackRock and Uniswap like 14 trillion in assets partners with a defi protocol that is absolutely massive in a bull market. Things would be going bonkers on this news. And it's barely a whisper, barely a whisper, but is a pretty big deal long term. Mr. Beast is acquired a Gen Z focused banking app and financial services company. Okay. I saw a lot of crypto people in my feed, very excited about this because I think of the Tom Lee bit mine investment of $200 million into Beast Industries. And so they were trying to extrapolate and connect some dots and basically say this means Mr. Beast and his bank will do the defi mullet will also provide Gen Z a way to buy crypto assets. Maybe putting ether in Ethereum in a primacy position there because of the Tom Lee influence. And I think there's no evidence of any of that. But if you squint you can kind of see it. And it is notable that content creators like Beast Media providers are getting so deep into the financial sector. Like that's kind of surprising to me.

[David Hoffman]

Yeah, allegedly Mr. Beast has announced that he's going to launch a financed focused YouTube channel, explaining topics like investing. Like he's using his distribution arm to just like king make finance apps that he buys. I don't know if it's really that easy. Like you can't just have distribution. Like you need to have a CEO like Vlad from Robinhood for example. Somebody like him to really lead the charge here. I don't think you influence your automatically by having it having the world's greatest distribution, but we'll see.

[Ryan Sean Adams]

Yeah. This is hilarious. My rep at Mr. Beast bank said I can have 9% APY savings account, but I do have to live in the bank vault for a hundred days. Maybe weird things have happened.

[David Hoffman]

You got kids, Ryan? Do your kids like. Oh yeah, yeah, they like Mr. Beast.

[Ryan Sean Adams]

I. I watch some Beast too. I mean, you can't not right? It's. It's pretty wholesome too.

[David Hoffman]

If your kids sign up for Mr. Beast instead of Robin Hood, you gotta let me know because I gotta sell my Robin Hood.

[Ryan Sean Adams]

Dude, they would be so excited to do a Beast Bank. I mean, they eat Beast bars. You know, he's got like candy and stuff. Yeah, not candy, sorry. It's.

[David Hoffman]

I think they're healthy. They're claimed to be healthy. I think that's the spirit of them.

[Ryan Sean Adams]

That's not why they're buying it. Okay, David, you can now give your open claw AI agent a self custodial wallet. This is Coinbase rolling out a new agentic wallet for crypto that give AI agents a self custody wallet so that they can do all of the money verbs. What do you think of this?

[David Hoffman]

Dude, Ryan, you know how we were just talking about like there's no, there's no users. People aren't going on to mega Eth because it's not paying them bajillions of dollars. Blah blah, blah, blah. Like we're watching the super bowl ads and everyone, all the humans are like, yeah, I'm fucking Coinbase. Like we don't like crypto.

[Ryan Sean Adams]

Middle fingers up.

[David Hoffman]

And then what happens when coinbase just spawns 1 trillion users with AI? I really enjoy transacting on blockchains.

[Ryan Sean Adams]

I'm so ready for it. This is all this agenic wallet, right? When we were talking to Austin Griffith last week and he was like, yeah, I hooked up my openclaw and now it can open metamask and click through all the stupid windows to get a transaction sign. But it turns out it just prefers a command line. It's trying to extract my private keys so it can do all this stuff.

[David Hoffman]

No, no, no, no, no, don't do that.

[Ryan Sean Adams]

Yeah, it was so obvious. It's so obvious that what crypto needs to do is basically Pivot to AI.

[David Hoffman]

Agents as users, as an industry, to just spawn users.

[Ryan Sean Adams]

Yeah.

[David Hoffman]

We will build them ourselves.

[Ryan Sean Adams]

Yeah, that's right. Anyway, and the first step is giving them a wallet that the AI agents are going to enjoy. And they. They will enjoy this. It's all command line. It's fantastic. I think this is the next big narrative coming out of crypto is probably going to be the thing that's going to happen.

[David Hoffman]

Yeah. You remember the AI bubble of a year ago. What happens when that's not just a small sector of crypto, but that's the whole industry?

[Ryan Sean Adams]

And notice, David, it's a financial use case. Okay. The agents aren't coming for on chain social.

[David Hoffman]

Notice that. I didn't notice that.

[Ryan Sean Adams]

Very cool. Also stripe just joined the X402 payments on base, so that's another step in that direction.

[David Hoffman]

Ryan, do you remember safemoon?

[Ryan Sean Adams]

I remember it. It was a scam in the midst of many scams.

[David Hoffman]

What are you talking about? It was safe and going to the moon, bro. It was in the name.

[Ryan Sean Adams]

Did we even get in a fight with these guys? I don't even remember.

[David Hoffman]

We probably did.

[Ryan Sean Adams]

Okay.

[David Hoffman]

We probably did.

[Ryan Sean Adams]

Okay. What happened? What was safe? It was a meme coin. What was SafeMoon?

[David Hoffman]

It was a meme coin that, again, was promised to be safe and to go to the moon. This was promised by Braden John Carney, the founder and CEO of SafeMoon, who was just recently sentenced to eight years in a federal prison for defrauding Safe Moon investors because it was not safe and it did not go to the moon. So conspiracy to commit su. Securities fraud, conspiracy to commit wire fraud, conspiracy to commit money laundering. Just basically threw the book at him. This happened in 2021. So if anyone was looking for closure on the SafeMoon story, here it is, all the bad guys in jail. Turns out crime is still crime. It just lags a little bit.

[Ryan Sean Adams]

Hmm. I want to believe that. I want to believe that crime is still crime.

[David Hoffman]

Crime is still crime.

[Ryan Sean Adams]

Sometimes it is.

[David Hoffman]

Unless you're the President. Unless you could party and then you can do whatever you want.

[Ryan Sean Adams]

Actually, can we get to that really quick? So all in my timeline this week has been SBF propaganda.

[David Hoffman]

Oh, dude, he needs to shut the fuck up, man.

[Ryan Sean Adams]

Tweets of sbf. And by the way, I can't even figure out how he's tweeting from prison.

[David Hoffman]

But something tweeting through a friend.

[Ryan Sean Adams]

All right. And it's just. It is glazing Trump. It is like, so, quote, tweeting a Trump truth social Tweet and saying, under Biden, all the companies were forced offshore. Under real Donald Trump, they're welcome back in America. The Democrats are insane. Just absolutely glazing Trump. And you know why, right? You know why?

[David Hoffman]

He's trying to get this pardon. He's trying to get the pardon.

[Ryan Sean Adams]

This man wants a pardon.

[David Hoffman]

He wants a pardon.

[Ryan Sean Adams]

He wants.

[David Hoffman]

He doesn't want to serve his 25 years, okay?

[Ryan Sean Adams]

And I think he's putting all this effort in. In fact, someone probably vibe coded the missing billions. This is a. The. The value of all of the FTX assets with their estimated value today, trying to make the propaganda case that basically SB s FTX was always solvent. Sam Bankman Fried did nothing wrong. It was some other nefarious, you know, group. You've seen this played over. I saw Milton Dumaris predict that SBF gets a pardon by summertime. A Trump pardon by summertime. Let me tell you, like, my head would explode.

[David Hoffman]

No fucking way is that happening. Can I take the other side of that?

[Ryan Sean Adams]

I mean, we should spin up. You should find a polymarker.

[David Hoffman]

Will SBF get. Well, that would be below 10%. That would be below 5%. The crypto industry will not allow SBF. What does he have to offer Trump?

[Ryan Sean Adams]

Money?

[David Hoffman]

Well, does he?

[Ryan Sean Adams]

I don't know.

[David Hoffman]

He doesn't have any money, bro.

[Ryan Sean Adams]

I don't know. I don't know. I'm worried that he has stuff that he could offer Trump and if you have stuff, you can just get that presidential pardon. That's my worry.

[David Hoffman]

No, the crypto industry, who also can. Has. Has given stuff to Trump and can continue to give stuff to Trump, would be in an uproar about that.

[Ryan Sean Adams]

I hope so. I hope so. I mean, I'm seeing more and more of this propaganda and I'm just worried that the narrative reverses and we start letting our. Our crypto criminals out of prison again. And, you know, there's no such thing as. There's no such thing as law, you know.

[David Hoffman]

You know what closure I would like with Sam Bankman Fried and the whole FTX saga that I have not gotten that. Where. I'm sorry, where is the 12 inch tungsten cube that he shipped to the Bahamas?

[Ryan Sean Adams]

What? Did you notice this trail? No.

[David Hoffman]

Yeah, so they buy. Remember the tungsten cube mania, which I'm pretty sure was started by Nick Carter? Like, everyone wanted tungsten cubes. I have two tungsten cubes. One, because I bought one myself because every man in crypto needs a tungsten cube. And two, the second tungsten cube that I got for beating Kane in our fight. And yeah, be. Be Kane in the fight got his tungsten cube. So like during the tungsten cube Mania FTX, Sam Pinkman Freed bought a 12 inch tungsten cube, which is something like £40,000 and like a quarter million dollars. That's the whole thing about it's, they had to forklift it into the FTX offices in the Bahamas. So like, it's not something that you can just lose, it's you have to forklift it. And so where did that go? I want to know.

[Ryan Sean Adams]

That's David's main concern right now.

[David Hoffman]

12 inch tungsten cube.

[Ryan Sean Adams]

Wait, are you a buyer? Are you a. I don't, I don't.

[David Hoffman]

I don't want to spend a quarter million dollars on Tungsten in 2026. I would just like to know where it went.

[Ryan Sean Adams]

Well, big mystery to end the roll up on. Let's end it there. Gotta let you know, none of this has been financial advice. You could lose what you put in. But we are headed west. This is the frontier. It's not for everyone. But we're glad you're with us on the bankless journey. Thanks a lot.