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- [00:03]
A
Bloomberg Audio Studios Podcasts Radio news. Last year, Atlas Virgin Capital sponsored an $888 billion, I should say million dollar merger involving Sonnet Therapeutics to create Hyper Liquid Strategies, a digital asset treasury company centered on the Hype Token. For more on this we're joined by Bob Diamond. Bob is the current CEO of Atlas Merchant Capital. He is the former CEO of Barclays. Bob, thanks so much for coming in on our one hour launch of Bloomberg Crypto. I want to start big P before we get into Hyper Liquid. How would you characterize the current environment for risk given how much sentiment and momentum on crypto has really shifted since last October?
- [00:43]
B
Well, I think over the last week or two we've, we've certainly seen deleveraging and probably a little bit of a risk off trade. You know, I think it's one of the reasons why we're so excited about Hyper Liquid which I always try and simplify things a little bit. Scarlett. But if you think about bitcoin and the volatility of bitcoin, mm, it's really a store of value and the price is really much more about supply and demand. It can be quite, quite volatile where Hyper Liquid is a layer one blockchain. It's a blockchain that was built for exchanges to be on top of it and execute on top of it. And I think of Hype, the native token as, as more similar to equity in a company. So it's much more valued based on the price earnings based on the volumes as we see hype be traded on on Hyper Liquid. But now Trade XYZ, which is a platform, a part of Unit through HIP3 they're able to go in on Hyper Liquid and build an exchange. And they're trading the nasdaq, they're trading Space X, they're trading Tesla and just recently they've been trading silver and gold metals. So we're seeing for the first time real application, real world assets coming on to an exchange. And I think this is, this is a sea change. But the volatility we've seen in things that are supply and demand driven stores of value is very, very different than Hyper Liquid which is really a business.
- [02:22]
C
We've, we've heard a lot in recent years about the idea of real world, real world assets being tokenized and trading. But I think there are still a lot of people out there who are unconvinced that this is a problem that, that needs solving.
- [02:34]
B
Convince them right now what silver is been trading on Hyper Liquid for about two or three weeks. Last Friday was The single largest day for volume of silver trading. I think as far back as you can go in history and trade XYZ on hyper liquid was 2% of the volume. I think if nothing can say we actually have real world assets on this exchange. Hyper liquid is doing it now over the last seven days. Days Bitcoin's down about 12%. Etherium is down about 20% and hype, the native token is up 40%. Think about those numbers. Down 12%. Down 20%, up 40%. It's because the volumes have been growing. Revenue has been growing. Last year revenue is just under $1 billion. There's 11 employees. This is a real business and for the first time we're seeing real world assets come on chain.
- [03:33]
A
What kind of adoption do you see from trad fry from traditional wall to the hyper liquid platform right now? Because they have a lot of concerns around know your customer and money laundering and these are things that don't get solved quickly.
- [03:47]
B
I can't even say trad fi very well. I say traditional finance. I'm so traditional finance tradfi I'm trying to work on it. Scarlett, you know, I think is some of the people were saying when you did those clips, the institutional adoption is real. We were an early investor. You had Jeremy Allaire on there. We're an early investor in circle. That's infrastructure, that's stablecoins, that's blockchain. These are things that real bankers or traditional bankers can really understand that. I think today all major banks, JP Morgan, bank of America, bank of New York, State Street, Barclays, they're all investing in blockchain. They all have use cases for blockchain. So one thing we're seeing for sure is the infrastructure is very much adopting blockchain as a, as a, in my own view, over the next five to ten years we'll see blockchain emerge as probably the most prevalent infrastructure really in finance writ large.
- [04:47]
C
We just spoke to Mike Novogratz over at Galaxy Digital and he regrets not getting into the prediction markets game sooner. With investments in the big players, the upgrade to hyper liquid will allow support for prediction markets. How do you compete with the call she's in the poly markets out there. What gives you the edge of the.
- [05:05]
B
So first of all, thank you for asking that. Hip three, we've been bringing equities on metals. On HIP four we're doing some more changes in the technology so we can bring prediction markets on. Literally in the next couple of weeks they'll be on hyper liquid. And I think what we've seen is that Hyper Liquid is fast. Hyper Liquid has deep, deep, deep liquidity and Hyper Liquid is on chain and those things mean that it's going to compete just as we've seen. You know, three weeks of having silver on trade xyz, it's already competing.
- [05:40]
C
I want to just end on one more digital asset, treasury type of question here. It's the ticker per. That's the ticker for your firm. It's been trading below net asset value. So what's driving that and under what circumstances would you actually consider selling Hype?
- [05:58]
B
So I don't think it's under net asset value. We have earnings next week so we'll go through so that we can be more public on what the, what the net asset value is so people can trade it back and forth. But, but yeah, I don't think your calculation is right.
- [06:15]
C
Okay, we'll have to go back and look at that. Just one more on that. Is is part of the value.
- [06:22]
B
And to be fair, I didn't really answer your question. I think we announced publicly a few weeks ago that when it was below net asset value early on we had approval from the board to buy up to 30 million of shares. I don't think we've reported back on that to the market but next Tuesday is our first earnings. So we'll be talking about that then.
- [06:43]
C
We'll wait to hear on that. Very briefly, is, is. Is the value proposition for her to give access to a wider audience and a wider user base.
- [06:52]
B
So I think, yeah, I think there's two value propositions. Value proposition one, and this is really, really critical, Tim, is this is a business creating revenues. The volumes are exploding and they're exploding in a very substantive way. We're going into new markets. We're actually getting real world assets through HIP3 through unit and trade XYZ on chain, we now have a native token which is usdh. So there's a lot of things that are building this business and increasing revenue. And so the first valuation of Hype is it has all the characteristics of, of a share buyback because 97% of the income that's produced within Hyper Liquid is used to buy back those tokens. So think of that as very, very similar to a share buyback. That's, that's number one. And number two. Now number three, what we're doing with our debt. And I think it is different. Everyone says it's different, but we're giving access to a lot investors who are not yet approved for perpetual futures to get access to hype into hyper liquid. And I think that's, that's the third value proposition.
- [08:01]
A
Bob, thank you so much. Bob diamond is Atlas Merchant Capital CEO, but you may also remember him as a former CEO of Barclays.