← CRYPTO 101
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- [00:00]
Unknown Speaker
Foreign.
- [00:10]
Bryce
Everybody. Welcome back to another episode of the Crypto 101 podcast. I'm your host, Bryce, as always, joined by my good buddy across the country, Mr. Brendan Veeman, who is unfortunately nursing a little bit of. A little bit of a weightlifting injury right now.
- [00:27]
Brendan Veeman
I know. A little bit. I was trying to hold the weight of the crypto market up. It became too much. It collapsed on me. It fell on me. But no, you know, all jokes aside here, I'm doing good. I'm buckled up. We're getting a lot of volatility. And I think the coolest thing about this volatility, Bryce, is that there are so many opportunities that come out of it. And luckily, or maybe even conveniently, we brought in someone who specializes in doing just that.
- [00:54]
Bryce
Yeah, an absolute legend when it comes to risk management and navigating the space. But on. On that point of volatility, dude, I just saw, you know, when this big sort of announcement that the XRP Cardano Solana, you know, might be in, you know, coming into this, you know, crypto strategic reserve, I saw that it was like the single day of largest market cap growth for crypto ever, and then followed by the day after was the second largest reduction of market cap ever. So that really is volatility. Anyhow, we are bringing in the expert, Joe McCann, who is the founder, the CEO and the CIO chief investment officer of Asymmetric. So, Joe, welcome to the show, and we're really, really pleased to be able to have you on the show.
- [01:41]
Joe McCann
Yeah, my pleasure. Happy to be here.
- [01:44]
Bryce
So what do you make of all this volatility? Before we kind of dive into your background, like, let's just kind of kind to the chase where we're at right now. Is the bull market over?
- [01:53]
Joe McCann
No.
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Unknown Speaker
No.
- [01:55]
Bryce
One word. No.
- [01:56]
Joe McCann
No. Where do I start? So I have a monthly market update that we put out for free. It's at Reid Asymmetric Dot Financial. Anybody can go read it. And in early July, I think that was like the first week of July, I put out the update, and I basically said the easy money is over. And what I am implying with that is that 2024 was kind of. I don't want to say it was super easy, but fundamentally, Bitcoin ETFs are coming, institutional adoptions coming. You kind of just needed to be long, right? Certainly bitcoin. Now, the rest of crypto, there's some other idiosyncrasies there. And it turns out actually Dogecoin was the top, top performing asset in the top 10 by market cap last year. So meme coins actually mattered last year, too. But as we've seen in the first nine weeks of 2025, it's not been easy. I mean, you just identified two incredibly volatile trading sessions back to back. And I've talked about this on other podcasts and interviews where I believe that we're going to start to see that level of volatility continue. And so what that implies as a risk manager or a portfolio manager or trader or investor, is if we're going to assume there's going to be a lot of realized, heavy realized volatility, what we're actually seeing in the markets, then what's your structural view of the market? Because the problem with, if you were to buy kind of on the rip on Sunday when the announcement came out, and then you sold on Monday when it kind of puked, and then it goes right back up again, you're just chopping yourself up. And so what I try to do is zoom out and look structurally and from a macro perspective, what's happening in the market. And what's happening in the market is the most bullish set of headlines in the history of crypto. You literally could not have dreamed something like this a year ago. And the market is straight down. And so the question then arises, why? And you know, personally, at the beginning of the year, I kind of caught a lot of flack for this on crypto Twitter. No surprise. I was actually somewhat bearish, just tactically from a trading perspective, for the first couple of weeks, that actually worked out. Bitcoin went from like 109k down to 89k, bounced back. We had a soft CPI print in the middle of January, and then we had Trump's inauguration. And so you had all of these potential positive catalysts coming, but the market went straight down. And so why? Well, it's not necessarily just crypto. So if you look at kind of the broader macroeconomic landscape, you've obviously got things like tariffs that are bringing a high level of uncertainty into the global markets. You have a lot of the momentum. Stocks are down worse than crypto, right? So, like, Tesla has lost something in the order of magnitude of like 50 to 55% of its value in a couple of months. That is. That is just crazy given the market cap of a company like Tesla. And they're not alone, Right? You can see the same thing with Nvidia. And in fact, Goldman Sachs has this kind of, you know, index or basket of stocks that they include in their beta profile. And it's off to the worst start in 15 years. Wow. So it's not crypto, Right? Crypto is when there's not an idiosyncratic event like Trump winning the election. And that just drove bitcoin's new all time highs. It tends to correlate like a risk asset and almost like high tech beta. And you saw that, right? If you look at Solana, for example, it hits a new all time high at $295. Drops to 1:25 in five weeks. I mean, that's aggressive. That's the same thing Tesla did.
- [05:58]
Unknown Speaker
Right.
- [05:59]
Joe McCann
So it's not meant to make people feel better that they're seeing these kind of, these drops in, in value. But it's not specific to crypto. It's. It's broader risk off appetite. And you know, as we sit here today, we have a huge amount of exhaustion signals in the broader markets, not just crypto, but the stock market. We saw the volatility index basically reach its highest level since December 20th today, and it's already fading back. Now, does this mean the bottom is in? I'm not suggesting that. What I'm getting to is the pro of us being closer to a local bottom. A lot of the market pricing in this tariff risks, and the tariffs went live with Canada and Mexico, with the United States at Midnight Tuesday morning, March 4th. The market is already digesting that now. The market has sold off, but we're starting to see a lot of short covering and we're starting to see a lot of exhaustion and deeply oversold levels for a number of assets, not just crypto. And so I do think that we're not out of the woods yet per se. But again, if I zoom out and go, okay, how many ETFs do we have coming in, coming for crypto? I mean, I feel like there's a new one every day, at least two or three dozen. Yeah, right. How many lawsuits has the SEC dropped in just like the past week?
- [07:26]
Bryce
6.
- [07:27]
Joe McCann
Yes. Sovereign wealth funds are buying Bitcoin ETFs in the, you know, hundreds of millions, if not billions of dollars.
- [07:37]
Unknown Speaker
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- [08:43]
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- [10:13]
Joe McCann
We're starting to see. I think even today we're seeing that President Trump's ready to sign a reversal on the Defi accounting rule. It's really hard now. Look, I've been. I've been wrong many times in the past, but it's really hard to look at that landscape and be like, yeah, the cycle's over the top is it. It just seems nonsensical. Now the market can disagree with me, right? The market disagreed with me, right? When Trump took office, it went straight down. But it wasn't just crypto, it was all risk. And so I think if we start to see, you know, crypto tends to lead risk. And so, you know, the pullback in Solana and in Bitcoin and even Ethereum and ethereum dropped below $2,000. When those start to stabilize and bottom and the stock markets are lagging a little bit, that's typically a sign of a reversal. Typically. This does not mean that it's just going to go V shaped recovery to new all time highs. It's just the way you need to think about managing your risk. And so in deeply oversold levels with crazy amounts of volatility like you were describing, it's really important to not blow yourself up or chop yourself up. You have to. You know, one of the things that we do at Asymmetric and you know, it's never fun talking to our investors about, yeah, we had a drawdown last month, right. But we wear the P and L, meaning when the P and L goes up really high, we're excited. Of course, we're happy with that. But on the downside as well, we just wear that because we need time for our trades to play out. And getting, I think chopped up by getting in and out of stuff too quickly and not kind of maintaining that structural view is how you'll end up missing these rallies. Right. The last thing I'll mention is that part of the reason that I stay invested in the current setup is you get days like Sunday where one announcement can rip the market 25%. Now it did immediately pull back, but those types of days, if you're not invested, if you're sidelined, as they like to say, you miss that and you end up chasing. And so wearing that P and L volatility is the price you pay for the returns.
- [12:39]
Bryce
Man. Wow, what a, what a Magnus opus there. Opening statement. I highly recommend everybody just to kind of pause, just go rewind, mind, re, listen to that first 10 minute segment because that's a really, really incredible state of play. And, and I kind of liked what you said there about sort of that, that shorter term, you know, seller exhaustion kind of coming and you know, myriad sort of number of signals showing that. And look, I mean, you're exactly right. I mean these, these are extremely volatile markets and it, it kind of results in volatile returns for investors. And you know, in 2024, you know, I know that Asymmetric had a kind of a. What would you call a grand slam year. So tell us a little bit about how you are thinking about just like, you know, are you invested only in large caps, are you doing small caps, are you algorithmic? Like how are you actually, you know, generating these returns based on your views?
- [13:36]
Joe McCann
Yeah. So it's probably worthwhile kind of explaining the. Try to say this with humility. The secret sauce at Asymmetric. Right. So a couple things. One is I've been a technologist and a trader for 25 years. About half the company are very seasoned software developers and technologists. But we're not an algorithmic fund. We use technology to our advantage. So we have a lot of proprietary in house software that provides us a really unique and differentiated view into not only the risk of our portfolio but other things within the ecosystem, whether it's global macro to wallet forensics. You pick something.
- [14:20]
Unknown Speaker
Right.
- [14:22]
Joe McCann
So that's a huge advantage to us. The other thing is we at Asymmetrics sit at this intersection of capital, technology and culture. And so one of the reasons why we had serious, we were, we found out we were ranked the number one hedge fund in the world for performance in 2023. And a lot of that had to do with me being the first fund to buy meme coins.
- [14:46]
Unknown Speaker
Right.
- [14:46]
Joe McCann
And you say, well, if you're like kind of like a global macro trader, portfolio manager, like what are you doing dabbling around in meme coins? And that's the point is that by having a pulse not only on the tech and the capital aspect, but culture, you can identify trading opportunities and crypto that just don't exist, literally don't exist in other markets.
- [15:06]
Unknown Speaker
Right.
- [15:09]
Joe McCann
So I'm constantly kind of sharpening my knife, so to speak, with respect to my strategies. And so people I've been doing it, did this interview the other day and they're like, what's the next big new meme coin? I'm like, the meme coin trade is over. This is the thing about being a trader is that if you just have one skill and it's, and you have one thing that you're targeting, like it's really hard to generate outsized returns with, with that kind of limited scope or expertise. And so understanding that you're constantly looking for these new opportunities and trying to probabilistically weigh these potential outcomes is how you, in my opinion, generate really great returns. And so, for example, yes, there was a meme coin frenzy in 2024, but that wasn't my kind of key play. So in late January, early February of last year, in 2024, Bitcoin was trading like 52,000 somewhere around there. I had this view that no matter who wins the presidential election, bitcoin is going to be significantly higher by the end of the year. Okay, that was my view. How do I express that view? Well, yeah, sure, you could just go buy bitcoin, but you're not going to generate any alpha or outsized returns with that. So instead, I went to the options markets and looked at end of the year expiration. So we're talking 11 months worth of time, right? Way further out in the future, buying these, what are called call spreads for pennies. And these were, you know, if Bitcoin is above $80,000, above $90,000, above $100,000 by the end of the year, these things are worth a fortune. And so that is an asymmetric trade, right? And I'm not saying asymmetric as the fund. I'm saying the asymmetry in that trade is huge. If you spend pennies on the dollar to make a dollar. And you're right, those things are worth a fortune, right? And that's exactly what it ended up happening, right? Has nothing to do with meme coins, right? Has nothing to do with culture. It has to do with an understanding of global macro and tradfi flows, as well as how markets may react to the presidential election. Now, I could have been dead wrong on that call in late January, early February, it wouldn't have cost us that much money in P and L because the amount of money that we spent was de minimis relative to the fund's aum. And so this is another example of how I'm thinking about structuring. To get back to my point earlier, you have to give yourself time for these trades to work, right? Like, I'm holding these things for 11 months into expiration, and the volatility of that P and L is huge, right? So in August last year, we had the Japanese bank varshock across all of risk assets. Crypto puked. And yeah, like our P and L on those options contracts that were worth a bunch of money were now worth a lot less. But then I gave time for the trade to work because I still had conviction in my view, and it turned out to be correct. Am I correct all the time? No way. Not a chance. But if I'm constantly seeking asymmetry in these types of setups, those are the types of trades that I want to put on. And so as it relates to 2025 I had mentioned, you know, at the beginning here, easy money's over, right? So you need to be a little more tactical and dare I say, somewhat more short dated, if you will, in your view and my view, which by the way, here's an example of me being wrong. My view was given all the headlines, given the Trump inauguration, given the first couple weeks of pullback in the crypto market, that we were set up for a breakout. What happened? We broke down dead wrong, completely wrong. But that doesn't mean I give up. It means that I continue to re examine and reevaluate, but then also re implement my view. And so that will change with like what spot tokens am I holding, what option structures do I roll things out further out into the year, do I roll strikes down, et cetera? Those are the things that come with having conviction in your view, and not being sort of paralyzed by the short term volatility and price action.
- [19:30]
Brendan Veeman
You know, 100 and me and Bryce, we like to trade too. And it really does come down to what the risk versus reward ratio is. And I think you make a great point there. Talking about, hey, if you can risk a few pennies on the dollar to make a dollar, it makes a whole lot more sense than risking a dollar to make a dollar. Or sometimes people risk $2 to make $1. And I think those kind of trades in the current state of the market, they just don't make make sense. Now can you go and do that in certain market conditions? Absolutely. Have you been able to do that in previous market cycles where you come in with five bucks to risk to, or to risk five bucks to make a dollar?
- [20:10]
Bryce
Yeah.
- [20:11]
Brendan Veeman
Is it that easy anymore? And I would agree with you, I'd say no, it's not. And you've kind of built this reputation of calling these moves before they happen, such as governance, such as AI, such as Meme coins, as you were talking about. But if we're starting to see that maybe like this Meme Coin era is ending, which it kind of looks like it is, at least to the same degree that we saw in previous months, like what could be next?
- [20:36]
Joe McCann
Yeah, that's such a great question.
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Brendan Veeman
And I know that's kind of a loaded question.
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Joe McCann
Yeah, I know, sure. I mean, so, you know, first of all, I think of kind of these new narratives that break out in crypto, or these new innovations, if you will. I almost think of them as software versions. There's the 1.0, the 2.0, the 3.0, et cetera. I like that. And so, you know, I, I, I, let's take the AI agent thing that happened in Q4. I was seeing towards the end of the year so many people saying that this is the, this is the new defi, and, and this is these things are going to whatever trillion dollar markets, insane top signal, frankly. And my perspective was this is a net new innovation that people are rallying around and speculating on. That's the 1.0 version. It's not going to be the thing that actually drives a significant amount of value. Turned out that was true. These things were radically overvalued. Their prices are down 80 to 99% depending on the token that you actually find. But there's going to be a 2.0 version. And so from there you'll start to see what quality assets, if you will, in the AI agent race actually are. And so I'm tracking a handful of these. Now, all of them look like crap in terms of price, especially given what's happened over the past month and a half. But I do think there's going to be an AI 2.0 moment. Meme coins, same thing, right? You had this might be like Dogecoin was probably like the beta version, if you will. Shiba Inu was kind of the 1.0, and then bonk on Solana was the 2.0. Well then you had 2024 where you had a 3.0, a 3.1, a 3.2. You just have this consistent kind of constant iteration and innovation around Meme Coins and everyone is massively bearish on it. Now. Guess what? There's going to be another iteration of Meme Coins, right? And so what could be the catalyst of that? I don't know. Maybe Pump Fun launches a token and airdrops it to people. You know, maybe there's a, maybe they decentralized Pump Fun altogether and people can actually start earning. Instead of Pump Fund taking all the revenue, they take a portion of it and they start to start to distribute it to token holders. I'm completely speculating. I'm not an investor in Pump Fund. I have no idea if this is happening. But imagine something like that happens, right? That will absolutely cause Meme Coins to start ripping again. So again, if you look at it from like, I think of it like software, there's going to be these versions coming out. Those are the things to kind of pay attention to. And then if you have conviction on a strong AI agent token or a strong Meme coin or whatever, and you see the price is utterly depressed, it may be worth taking A shot because the asymmetry may actually be there because all it's going to take. I remember actually in, I think it was kind of after April last year, maybe May time frame, the meme coins were going absolutely insane. And then you started to see the kind of pullback in activity and interest. And I was seeing, you know, Eth Maxi B VC saying it's over for Solana, it's over for meme coins. And then guess what happened?
- [24:10]
Bryce
Q4.
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Joe McCann
Exactly right. And so this is what I'm getting to, is that there's actually asymmetric downside in trying to call the top or the complete destruction of a new innovation. It's just silly. There's no upside in doing that, except maybe you're chasing clout or engagement on Twitter. And so my view really is like, right now I'm. You're seeing it everywhere. The melee token was the. Was the top. Meme coins are dead. Meme coins are over. That is absolutely the sign of a bottom. Yeah.
- [24:45]
Bryce
And underneath the surface, kind of back to your point about, like, the fundamental backdrop, it's like literally all this massive barishness. And then you have the SEC come out with the declarative order saying meme coins are officially not securities. It's like, okay, it's totally going to put in the bottom long term.
- [25:02]
Joe McCann
That's right. And price is the ultimate kind of arbiter of sentiment. And when you do see positive headlines like the one from the SEC and price doesn't react, bottom's not quite in yet. Typically when assets start to rise on bad news, that's a really good sign of a bottom.
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Bryce
But.
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Joe McCann
But yes, factor in. I mean, even the SEC announcement in and of itself is huge for meme coins. Price hasn't reacted yet.
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Unknown Speaker
Right.
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Joe McCann
And so there's going to be some catalyst. I don't know what it is because I can't see the future, but I'm open to, you know, monitoring and tracking what's happening in the meme coin space so that if and when this thing actually comes to fruition, it could be a month from now, it could be a year from now. We don't know. That's when the opportunity will present itself to actually kind of reengage in meme coins and the opportunities there as it relates to, like, what is my view for this year? What's next? It's not particularly sexy to, I would say, retail or consumers, but the institutional changes coming to crypto are absolutely enormous. If you guys are familiar with Staff Accounting Bulletin 121 SAB121, this was a thing passed by Gary Gensler's SEC that made it functionally impossible for banks to custody crypto on their balance sheets because they could only be counted as liabilities. Banks are never going to do that.
- [26:35]
Bryce
It's like the only thing that actually doesn't have any debt attached to it and it's a liability. It's like how upside down.
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Joe McCann
So they basically kept the banks out of crypto. Well, SAB121 has such, you know, been since then been repealed or reversed and you have literally the heads of the largest G sibs. So these are globally systemic. Investment banks are coming out saying like bank of America CEO, we're probably going to launch a stablecoin, right, Like Citibank. We're going to be providing crypto custody services. I met with a private bank from Switzerland the other day and they're going to be offering it to their clients. Just custody and crypto. Well, what does custody and crypto mean for these banks? Well, first it means, hey, if you want to park your assets with us, we can custody it. But also we can then create borrow lend facilities in our prime brokerage which brings leverage into the system. We can offer it to our private wealth management group so they can sell Bitcoin structured products to their customer or their clients.
- [27:39]
Unknown Speaker
Right.
- [27:40]
Joe McCann
This is enormously bigger than a strategic Bitcoin reserve. I'm sorry, like it's just so much bigger because you have the global banking system now adopting and integrating and offering services around crypto. And so that's not pointing to a specific trend or token or vertical. It just means in mass crypto is going to become more institutionally adopted. And we saw what happened with just the ETFs last year. Imagine when there's now prime brokerage services and private wealth management groups that are able to offer crypto directly to their clients.
- [28:16]
Bryce
Totally. And I even saw what's called Citadel, right? I mean one of the largest market makers in the world. They're sudden, they're going to come in, they're going to be touching crypto. And I think that's, you know, exactly to your point. I don't have a question or anything, but it's just like, yeah, totally reiterating, like the, the institutions are here finally and it's going to make for a completely different sort of trading environment.
- [28:38]
Brendan Veeman
And the cool thing about this is that these dips that we are in, these dips that we do get when we have as many catalysts as we just talked about, that's what creates the potential for these asymmetric return opportunities that we've been talking about all, all episode. These asymmetric trade opportunities, they don't come when we're hitting a new all time high of 110k. They don't, they won't come when we're hitting a new all time high of 150k, 200k, et cetera. You know, they come when we pull back like this and then add an opportunity where bitcoin's down double digits, altcoins are down 50, 60, 70%, and we still have all the catalysts loaded into the can and ready to go. That's when we actually see asymmetric trade opportunities. And so when for everyone that's listening, if you're beaten down and you're kind of upset about the market, just know that this is when the real opportunities truly do come. And it doesn't seem like it in the moment, but this is really when they do come. And so, Joe, you know, how do you monitor and how do you track crypto in general? Is there any kind of specific data points or metrics or information that you like to look at?
- [29:50]
Bryce
And also kind of in follow up to that, like, are you more of a technical analysis guy, a fundamental analysis, or do you kind of pair the two together?
- [29:58]
Joe McCann
Yeah, great questions. So how do I put it? I'll answer the second question first. That'll, that'll support the first question. So I've been doing technical analysis from day one, so 25 years now. But I also used to trade on Wall street and learned a skill called tape reading, which is real time, you know, flows coming in to the market, buying and selling, and trying to identify patterns. The reason it's called tape reading is back in the day on Wall street, it was literally a ticker tape that would be printing out of buy and sell orders for stocks. I also do fundamental analysis right up until Trump won the election. I wrote about this in December's Market Update. I was like, there's no reason to apply fundamental analysis to tokens that are generating revenue because they can't actually issue dividends. Well, that's changing now, right? So there is a case to be made for also understanding fundamental analysis of these potential, potential tokens and constructing a view as to why this thing may be under or overvalued. You know, I also track volatility. So this is, you know, the options markets, they, they are huge signals. And in crypto, historically, they are radically mispriced. As an example, Bitcoin, historically, here it's like 100 volume asset class. It's been at the money implied volatility for 30 days out options contracts has been in the 40s. That is crazy given the potential upside. And so you want to look at how are the options markets, pricing, risk. And so there's, you know, there's a bunch of math associated with that. So I'm not just a technical analyst, I'm not just a flow reader, tape reader, I'm not just a fundamental analyst. I actually try to synthesize all of this to influence my broader view, which comes back to like, what are the data points, indicators, et cetera. Right. So if you take TA for example, there's some stuff that just, you know, I know TA is like astrology for men or whatever people say, but I don't care. It absolutely helps inform my decision making. It is not a silver bullet. There's no silver bullets period in investing or trading. Like you can't predict the future, but what you can do is have certain probabilistic weightings applied to your view. And so the beauty of technical analysis is not that it's a silver bullet, it's that you're having it inform your decision based on the probabilities historically.
- [32:43]
Unknown Speaker
Right?
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Joe McCann
So for example, last, I think the last week of, I guess this Sunday, right, when the Trump announcement came out, you basically had monster bottoming signals across the board. Weekly candles, weekly timeframes, daily timeframes. Things have been grossly oversold, which suggests that a bottom is potentially in what happened the very next day. Reverse, straight back down, right? That is an example. If you just use technical analysis, you're, you're going to fail right now we could still have be bottoming here from a TA perspective, but you can't use it as just one blunt instrument in the way that you invest.
- [33:27]
Unknown Speaker
Right?
- [33:28]
Joe McCann
So what I try to do is I, I have, you know, a bunch of kind of, I have some proprietary indicators that I've built in, in software that I have at Asymmetric that I use to monitor flows. I've actually open sourced one of these indicators. It's the core Coinbase premium or discount indicator, which for me is, it's pretty telling. I mean, when there's a deep discount, usually you have ETF sellers, right? So like last week when we were really pulling back, we broke below that 90k level. You had some of the widest Coinbase discounts in a long time and lo and behold, you had record ETF outflows.
- [34:07]
Bryce
Now correlation kind of selling is on.
- [34:10]
Joe McCann
Coinbase and That's right, yeah. Because the majority of the asset issuers for these ETFs custody with Coinbase.
- [34:15]
Unknown Speaker
Right.
- [34:16]
Joe McCann
And so you can see practically in real time what's happening with the flows when you look at something like a Coinbase premium or discount. And the opposite is true when there's a, when there's a very strong Coinbase premium relative to Binance, that's usually institutional buying.
- [34:30]
Unknown Speaker
Right.
- [34:31]
Joe McCann
And so that's another kind of, you know, indicator or tool that I'll end up using in a very short time frame to kind of get a sense of like how is the market actually positioned? In addition to that I think it's super important to pay attention to funding rates when, when you know, funding rates in a bull market, when they're very elevated, you should probably sell typically, right. You may not nail the top, but when they get really extended it means there's a ton of leverage and the market is skewed, too bullish and it tends to pull back now in sideways to lower markets. Negative funding rates, you would say, oh man, the funding rates are negative, there's going to be a short squeeze. That's not necessarily the case. You can use that as a guide. But the funding rates have been negative for six weeks and guess what? We went down.
- [35:22]
Unknown Speaker
Right.
- [35:22]
Joe McCann
And so there's also those aspects. I think another thing that I, that I tend to look at are Dex activity. Hyperliquid is, actually has a lot of very interesting data. There's a, I forget the name of the website. It's like hyper data or Hyper Dash or something like that. They basically take in all of this information that's, you know, it's all on chain. You can see what's on there and you can see what's happening with you know, what is the percentage of people that are long or short. What are the top traders on Hyper liquid, like how are they positioned? That can also influence your view. But you don't just copy trade these accounts, right? Because you may not know that hey, they might be short here, but they could be long elsewhere and they're just hedging, right. So a lot of this stuff and then there's things like blockchain wallet forensics and flows and these types of things. I would say that the shorter answer the question is that I synthesize a ton of data and one of the tools that we have internally at Asymmetric we've built kind of like this AI LLM based infrastructure that consumes every bit of sell side research PDF that's produced every single day in real time. And it could also give me the ability to be like, there's a non farm payrolls print coming this Friday. I could just prompt it and ask it, what are the top five investment banks views on the NFP print due this Friday? Provide me an analysis of like, you know, if it's bullish or bearish or whatever. Right. And the LLM will go in and parse all that information and present to me its findings. Wow. Things like that. You know, we built this at Asymmetric. It's not publicly available, but this is also part of our edge. Right. These are, these are the tools that we end up using to, to. There's no way I could read 300 PDFs in a day. It's impossible. But an LLM can and I can prompt it and it can provide me with that type of information. So when I get back to, you know, sitting at the intersection of capital and culture, there's a very strong technology piece here that benefits us at Asymmetric, but also benefits me as the, you know, the, the, the fund manager to make these decisions.
- [37:33]
Bryce
Yeah, no, that's awesome. And if you're ever looking for a new revenue stream for, you know, you could, you know, white label that incredible piece of software that you have and then, you know, sell it to people because that, that's something I'd probably spend some money on.
- [37:46]
Joe McCann
Well, it's, you know, it's funny you say that because it is a separate company.
- [37:50]
Bryce
Oh, yeah, there we go.
- [37:52]
Joe McCann
There is, I have a free, a free call option to eventually open that up to the public if I, if I so choose. But right now it has basically one customer, which is Asymmetric.
- [38:01]
Bryce
I love it. Hey, and if it's your secret sauce, then why are you going to give everybody else that ingredient? Because it's a competitive market.
- [38:06]
Joe McCann
No.
- [38:07]
Bryce
Hey, Joe, look, you've got so many, you know, so many different ways to, to slice and dice the market and it's really awesome. It's almost just like, you know, a renaissance man approach to the market. You know, I'm not going to be a purist in any one way. I'm going to take in as much information as I can synthesize it and I think that's awesome. Just plus you've got, you know, so much experience and so tell us a little bit about the funds. You know, like, do you have venture funds, hedge funds? Are you managing both? Do you have one? Do you have a slew of them? How does that kind of work?
- [38:40]
Joe McCann
Yeah, it's A lot of work. Pardon my.
- [38:43]
Bryce
It's a lot of damn work.
- [38:45]
Joe McCann
I live on an airplane, I swear to God, like every day. Oh my God. So, yeah, so asymmetric. When I created it In January of 2022, the intention was that I was basically going to replicate what I was doing on my personal balance sheet. So I've been an angel investor for years, an advisor to lots of startups. I used to be the founder and CEO of an open source venture backed software company. I raised 40 million in venture for that business and sold it. So venture was important to me because that's where you can really get crazy asymmetry.
- [39:21]
Unknown Speaker
Right.
- [39:23]
Joe McCann
If you do your job, you should have a pretty profound amount of returns from that fund.
- [39:32]
Unknown Speaker
Right.
- [39:33]
Joe McCann
I only do early stage for the most part and I'll get to why in a second. Or I guess the caveat to that in a second. So we have Venture Fund 1, which has been fully deployed for a while. We've got some great companies in there. All this stuff's on our website. But you know, handful of them I can think of off the top of my head are Jito and Hyperlane and Turnkey and Tip Link and SEI and X Populous. These companies have done a lot of amazing things. No venture portfolio is going to have 100% success rate, but we've had really great performance out of that fund. Last year, Bitcoin OG Dan Held, who's a friend of mine, joined the firm. Yeah, nice. And we have the, what we, what is called the asymmetric Bitcoin Defi venture fund. So we have a vertical specific venture fund that is only investing in early stage startups building on bitcoin. So the bit. Bitfi vertical. Right, Very cool. I just announced a couple of weeks ago that we're going to be doing a new venture fund again, Early Stage, that is the first crypto fund in history that is exclusively focused on consumer apps and web 3. And part of the reason I think that this is the Time is now is if you just look at the history of venture investing in the Internet, in the mid to late 90s, you had venture capitalists investing in the physical infrastructure being laid for the Internet. What were they doing eight, nine, ten years later? They weren't investing in the physical infrastructure for the Internet. What were they investing in? Facebook, Twitter, Groupon, Instagram Square.
- [41:15]
Unknown Speaker
Right.
- [41:16]
Joe McCann
These applications where the customers. Are. Correct. Yeah. And what's worth more? Cisco or Facebook.
- [41:24]
Bryce
Right.
- [41:24]
Joe McCann
Like, I mean, so, so to me, when I, when I, you know, obviously as a technologist, I've been in the weeds of the advancements in blockchain based technologies and my view is were probably good enough with the infrastructure stuff. And then furthermore, this is where my trader hat comes on. All of my colleagues coopetition in the venture space, not all of them, most of them continue to invest in infrastructure and they're chasing a trade that worked from 2018 to 2021. I don't think that trade works anymore. I think you actually are going to have too many people crowding behind the next Barachain or Monad or pick one. I'm not picking on those chains specifically, but people are trying to find the next Solana or the next Swee or whatever it is. And hey, they might. I just don't think that there's a lot of value in a place where everyone is looking at the same thing and all of the VCs are following the same playbook. So instead I go, hey, you know, President Trump launched a meme coin on Solana and Solana's chain handled it pretty well. I'm pretty sure that was the biggest test of a blockchain in the history of blockchain in terms of scale and reliability. That is a signal to me that it's probably time for consumer applications to be built on the chain. It could be other chains too, but meaning that the infrastructure is probably good enough. And so we're launching this early, we're fundraising for it now. Pretty much all consumer app application stack. We're not doing L1 protocols or cross messaging bridges or any of that kind of stuff out of this fund because that that has been done. And so that's the kind of venture portfolio now I mentioned. I pretty much only do early stage, but we do have a couple of things that are called SPV special purpose vehicles. And so I have been a huge fan of Circle Incorporated for quite some time and had an opportunity to buy some shares at a deep discount a couple years ago and created this kind of special purpose vehicle where the only purpose is to go and buy these shares and basically hold them and either the company gets acquired or they go public or whatever. Right. That's a kind of, you know, I don't want to say set it and forget it, but it's close to that because the purpose was to just buy these shares and hold them until there.
- [43:48]
Bryce
Is some liquidity event now, special situations kind of moment.
- [43:52]
Joe McCann
That's exactly what it is. Yeah. On the hedge fund side, you know, we launched with our flagship fund, which is our liquid Alpha fund. This is the one that I'm probably most known for, from the returns, et cetera. It is a long, short, discretionary fund, which means it's to the discretion of the manager, which is me. So you're effectively investing in me and my ability to generate returns. Now we had a bunch of investors and prospective investors asking us if we could create a fund that took on more risk, which I'm like in crypto.
- [44:24]
Bryce
Okay?
- [44:27]
Joe McCann
So the liquid alpha fund, we have a bunch of constraints, risk management policies in place, and one of those is that we Never go above 1x leverage on the notional value of the fund. So if the fund has $100 million, the notional value that we ever put into the market is never more than $100 million, which implies that in order for the fund to blow up to go to zero, we have to be fully invested and every single one of our investments has to go to zero.
- [44:53]
Unknown Speaker
Right.
- [44:57]
Joe McCann
That's constrained risk for crypto.
- [45:00]
Unknown Speaker
Right.
- [45:00]
Joe McCann
So these guys, you know, they come to me and say, can you take on more risk? And I was like, sure. So we created a second hedge fund called the High Volatility Fund. And it's exactly what it sounds like. We have the option but not the requirement to use up up to 3x leverage. Right. So the swings in this, I mean, it's intended to swing because we have the ability to actually punt more size or take on more risk that will make the fund more volatile.
- [45:29]
Unknown Speaker
Right.
- [45:30]
Joe McCann
So put all that together. It's a lot, Right? That's what I was saying. It's a lot of work, but I love what I do every single day. It's amazing. The industry is so innovative, it's so entertaining. I mean, I tell people once you work in crypto, it's like impossible to go work in another industry because it's just so insane. But you know, I also have a great LP base, I have a great team behind me and it's just been a wild ride. I mean, to launch a fund in, you know, basically the worst bear market in, I don't know, a lot, like decades. And I don't mean just crypto. Like 2022 was brutal.
- [46:10]
Bryce
Worst bond market since like the Civil War.
- [46:12]
Joe McCann
Yes, exactly. You know that. And then, you know, you've got three Arrows and Luna and then ftx. And to like get through that as the first year in business, I felt like if we were going to die as a, as a startup, as a new fund, it would have been that year. And so now it's just purely execution based and continue to grow the business. In a meaningful way and continue to generate returns for my investors.
- [46:36]
Bryce
I love it. And Joe, you know, I feel like I would be remiss if I didn't ask how can people get investors involved? Kind of as a closing question, you know, if people are listening, they're like, man, some of these are really cool, you know, really cool things that he said. And sounds like he's got a lot of good funds under management. Can anybody get access? Do you have to be a qualified investor? Do you have to be an institution? And where can we maybe learn more?
- [47:01]
Joe McCann
Yeah, so you can easily just go to asymmetric.financial, the website. There's a form there that you can fill out. Investor inquiries. We are a regulated fund. Right. So I don't make the rules. But yes, you need to be accredited investor or qualified purchaser to invest, and we have certain minimums, et cetera. Kyc, aml, all the basic standard stuff that you would have for any hedge fund or venture fund. And that's the best way is just to contact us.
- [47:30]
Unknown Speaker
Right?
- [47:30]
Joe McCann
Like we have decks and all the information. You can review all the returns. We, you know, we're basically an open book. I mean, one of the things that I love about the space is that it's, it's default transparent. And we, we really lean into that because we are transparent, we're open book. And, you know, people look at the returns, they're like, how did you do this? And like, here, here's the information.
- [47:56]
Bryce
That's awesome. No, I love that it kind of in, in the full sort of transparency and spirit of crypto. No, I love it. And Joe, you know, I'll be following up with you on behalf of our. We've got a hedge fund called Tower 18 where we have a fund of funds. And so we're always looking at the best and brightest managers. And so I definitely want to take a look at the, the new fund that you're launching and really appreciate you joining us. What's your Twitter handle? Or, you know, we've got your website. We want to put everything in the show notes. I know you're very active. I've been following you for years. And then we'll, we'll let you get back to crushing it in the markets because I'm sure you're. You probably got the, the tape up on one screen, text coming in, chatting with the AI bot over here on the other.
- [48:39]
Joe McCann
Yeah. So you know, twitter.com Joe McCann, you can go. I have a telegram channel that I've had for six years now, which is Kind of crazy to think that's it's t me Joe's crypto. And there is a. That's a broadcast channel. There is a chat room associated with it called Market Mercenaries, which I can share that as well. And, yeah, I mean, I'm super active on Twitter, so that's probably the best way to. To find me.
- [49:08]
Bryce
Awesome. Well, thank you so much. And everybody at home listening. I'll just say you're welcome for bringing on Joe today. I think that was a very, very fruitful conversation. I know I learned a lot, and I'm sure everybody it at home. So with that being said, everybody come on back next, next week, same time, same place. We'll have some more great guests for you. Take care. And, Joe, thank you again.
- [49:29]
Joe McCann
Thanks, guys.
- [49:41]
Bryce
What is Dax, are you tracking all.
- [49:44]
Unknown Speaker
Our cars on Carvana Value tracker on all our devices? Yes, Kristen. Yes, I am.
- [49:49]
Well, I've been looking for my phone for.
- [49:51]
In Dax's domain, we see all. So we always know what our cars are worth.
- [49:55]
Joe McCann
All of them?
- [49:56]
Unknown Speaker
All of them. Value surge trucks up 3.9%.
- [50:00]
Joe McCann
That's a great offer.
- [50:02]
Unknown Speaker
I know. Sell.
- [50:03]
Joe McCann
Sell.
- [50:05]
Unknown Speaker
Track your car's value with Carvana Value Tracker today.