Bitcoin CRASHES To 21-Month Low As Circle DUMPS 17%

Summary

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Podcast Summary: The Wolf Of All Streets

Episode Title: Bitcoin CRASHES To 21-Month Low As Circle DUMPS 17%
Date: July 1, 2026
Host: Scott Melker
Guest: Alex Thorne (Galaxy Digital)

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Episode Overview

This episode unpacks one of the most tumultuous weeks in crypto: Bitcoin's crash to a 21-month low, Circle’s stock plunging by 17% following the launch of Open USD from a massive consortium of 140+ corporate giants, and the ongoing battles over stablecoin regulation, with a heavy focus on the larger market forces driving these events.

After a rocky start due to guest technical issues, Scott Melker delivers an in-depth solo segment before Galaxy’s Alex Thorne joins for a deeper dive into market structure, stablecoin competition, regulatory wrangling, microstrategy risk, and the contentious future of digital assets.

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Major Discussion Points & Insights

1. Market Turmoil: Bitcoin’s Steep Drop and Circle’s 17% Crash

• [00:01] Bitcoin plunges to its lowest point in 21 months, coinciding with Circle stock falling 17% after the Open USD announcement.
• Open USD’s launch is seen as an existential threat in the stablecoin space, with a consortium including corporate heavyweights like Visa, Mastercard, BlackRock, Google, and Coinbase.
• Scott: “It’s going to be an interesting time in the stablecoin race and everybody wondering if Bitcoin has possibly bottomed.”
• The focus shifts to regulatory and business model vulnerabilities in stablecoins due to changing revenue flows and legislative risks.

2. Trump’s Crypto Earnings

• [00:45] Melker reviews Trump’s recently filed crypto earnings, revealing over $1.4B in 2025, broken down by project and transaction.
  • Meme coin fees alone: $635M
  • World Liberty Financial token sales: $236M
  • Sale of USD1 stablecoin venture stake: $196M
  • Additional NFT, token, and staking income
• Scott questions audience: Is this “illegal?” Is it a net positive or negative for crypto?
• He explains the political impact: the end of the “Gensler-Biden era” was a “massive positive” for crypto, but Trump’s personal profiteering gives ammo to critics and revives the “anti crypto army.”

3. Regulatory Landscape: The Genius Act, Clarity Act, and Stablecoin Loopholes

• [05:30] Breakdown of how the Genius Act and Clarity Act frame stablecoin issuer rules.
  • Genius Act: Prevents issuers (Circle, Tether, etc.) from passing yield to customers, but not platforms (like Coinbase) and intermediaries, creating exploitable loopholes.
  • Scott: “140 companies now saying we can keep all of that for ourselves, not pass it on to the customer... making a bet that the Clarity Act does not pass.”
  • If the Clarity Act passes, these loopholes close, so the consortium is betting on regulatory inertia.
• Stablecoins’ business model—revenue from interest on floored assets (“float”)—is finished if too many parties want a cut or regulatory changes occur.

4. Breakdown of the Open USD Consortium

• [11:15] Details on Open USD:
  • 140 companies, aiming to replace USDC/USDT’s float model.
  • Consortium will keep float revenue themselves instead of passing it to users.
  • Notable: No Circle, Tether, or PayPal in the group; led by Stripe’s acquired company Bridge.
  • Launching first on Solana and Stripe’s “Tempo” blockchain, then expanding chain-agnostically.

5. Technical Analysis & Sentiment Signals

• [17:00] Melker discusses technical signals indicating potential market bottom:
  • Multiple timeframe bullish divergences on RSI.
  • “Every single bottoming signal that nobody ever believes when you’re actually at the bottom is there right now... this is just, I think, objective truth.” —Scott [18:22]
• Reflects on public sentiment: extreme fear and consensus on further decline suggests potential reversal.

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Alex Thorne Joins: Enhanced Analysis

[19:37 – 46:17]

6. Stablecoin Market Structure and Competition

• Consortium skepticism: Alex questions the historical viability of consortium-led stablecoins: “There is no history of a consortium stablecoin doing that well... This is an uphill climb for anyone.”
• Tether and Circle dominate, with “an order of magnitude” more market share than even MakerDAO (the third largest).
• He highlights the press-release nature of the Open USD announcement, noting lack of technical details or whitepaper. “We have exactly zero information.” —Alex [22:10]
• Coinbases’s role: Despite their connection to USDC, Alex speculates they’re signaling willingness to give up stablecoin economics to acquire customers (“fighting to give stablecoin rewards away”), and that “the economics of the stablecoin issuer are eroding.” —Alex [24:20]

7. Odds of Regulatory Passage (Clarity Act)

• “Odds are declining. I try to give granular, in-the-moment assessments… It has been declining.”
• Alex is the only “crypto-side analyst” doing public market odds on Clarity. “Most crypto firms are solely focused on advocacy.”

8. On-Chain and ETF Flow Data

• [26:34] Alex shares insights from their “institutional adoption vs OG distribution chart”:
  • Compares dormant 5+ year coins moving (i.e. OGs selling) vs ETF and MSTR accumulation.
  • “The net is that dotted black line. Look how well the black line follows price.”
  • Capitulation by OGs is possible at these levels, but long-term holders (155+ days) are buying. “This is what always happens in a drawdown. Short-term holders sell to long-term believers.” —Alex [30:17]
  • 58k is a key defense level in the current market.

9. MicroStrategy & Michael Saylor: Risk, Leverage, and Narrative

• Both discuss:
  • Saylor now has “every possible option” open after recent moves; they praise his capital management and note low risk of insolvency.
    • “He holds almost 5% of all the bitcoin on planet earth.” —Scott [31:32]
    • His leverage is “a very small amount… the liabilities … come nowhere near the value of the bitcoin.” —Alex [31:57]
  • Danger in him selling bitcoin: could unleash a “vicious cycle.”
  • Language matters: Saylor’s prior braggadocio (“indestructible fortress”) led to pushback, prompting more humility in subsequent communications.
  • Scott's advice: “Sometimes the hardest thing to do is to do nothing. Traders, good traders will tell you this all the time.” [34:46]

10. Shareholder Value, Dilution, and Strategy

• Debate on buying at market tops vs bottoms using shareholder dilution—Scott argues for more nuanced metrics.
  • “Sometimes, buying the bottom by diluting slightly could be a better long-term play than buying the dead top at a premium.”

11. Other Topics: Coming Trends and Minor Capitulation

• Further discussion on:
  • Tokenized stocks and exchange-launched L2s (Robinhood Chain, Coinbase, etc.)
  • Stablecoin market structure usually follows a 60/30/10 distribution pattern—could OUSD or even JPM Coin disrupt this?
  • GPU markets and mining transitions to AI compute: “The per dollar revenue from compute is substantially higher than… bitcoin mining.”
  • Miner capitulation and hash rate drawdown are classic bottom signals, yet under-reported.

12. Consensus and Closing Market Sentiment

• Scott: “Nobody’s base case is bitcoin can just slowly float up… That feels so much like the bottoming process.” [45:39]
• Alex agrees: “People like Grantham coming out… they always come out at the bottom. I think we’re near the bottom, if not at it already.”

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Notable Quotes & Timestamp Highlights

• Scott [00:01]: “It’s going to be an interesting time in the stablecoin race and everybody wondering if Bitcoin has possibly bottomed.”
• Scott [09:40]: “Coinbase makes more money on USDC technically than USDC does. And that deal comes up in August. Coinbase just slowly shanking jail jail style Circle here.”
• Alex [20:23]: “There’s no history of a consortium stablecoin doing that well... But there’s not a lot of history in stablecoin history.”
• Alex [22:10]: “For something called open standard… we have exactly zero information.”
• Scott [24:30]: “USDC is the product but the business is float. And that business is over.”
• Alex [30:17]: “In a drawdown, short-term holders sell to long-term believers… That’s always what happens.”
• Scott [31:32]: “He holds almost 5% of all the bitcoin on planet earth. And dumb ass influencers are throwing out bankruptcy…”
• Alex [31:57]: “Liabilities … come nowhere near the value of the bitcoin. Very small leverage relative to his stack.”
• Scott [34:46]: “Sometimes the hardest thing to do is to do nothing. Traders will tell you this all the time.”
• Scott [45:39]: “Nobody’s base case is bitcoin can just slowly float up… That feels like a bottoming process.”
• Alex [46:05]: “I think we’re near the bottom, if not at it already.”

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Key Segment Timestamps

• Market context, solo show intro: [00:01 – 05:00]
• Trump’s crypto gains and regulatory impact: [00:45 – 10:00]
• Stablecoin business models and Open USD overview: [10:00 – 18:00]
• Technical analysis of bitcoin bottom: [17:00 – 19:37]
• Alex Thorne joins, stablecoin industry analysis: [19:37 – 26:30]
• OG/ETF data and holder behavior: [26:30 – 31:00]
• MicroStrategy/Saylor risk & leverage: [31:00 – 38:00]
• Strategy, dilution, and market narrative: [38:00 – 41:52]
• Trends: tokenized stocks, miners, GPU markets: [42:00 – 45:30]
• Macro sentiment and episode close: [45:30 – 46:17]

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Summary Takeaways

• The episode captured an inflection point for crypto: massive price action, power struggles in stablecoins, and regulatory uncertainty.
• Stablecoin profit models are under siege both from big-tech/finance alliances and potential legislative shifts.
• Michael Saylor and MicroStrategy continue to dominate market risk narrative, with broad agreement that patience and discretion are now required, not bold moves.
• Technical and on-chain indicators stack up in favor of a major market bottom, echoed by a deep sense of public gloom.
• The stablecoin race and regulatory chess match are in full effect—watch for further drama as the Open USD consortium either shakes up the market or ends in “yet another whitepaper moment.”

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For new listeners:
This episode delivers a concise yet insight-rich overview of the latest crypto flashpoints. Scott’s balance of technical discussion, narrative analysis, and industry skepticism, paired with Alex Thorne’s research-driven insights, make this an essential listen for understanding how the next chapter of digital finance may unfold.

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Transcript

[A]

Bitcoin dropped to a 21 month low as Circle also dumped 17% in a single day on the announcement of open USD from 140 plus competitors. It's going to be an interesting time in the stablecoin race and everybody wondering if Bitcoin has possibly bottomed. We've got Alex Thorne hopefully joining today from Galaxy. If he doesn't, you get a solo show because we started anyway.

[B]

Let's go, let's go,

[A]

Let's do Good morning everybody. Happy Wednesday and welcome to the lovely lake house with the cherry blossoms and the breeze. I'm feeling very calm today, wildly unprepared to do a solo show because I depend on my guests to bring all the alpha and then some days wires get crossed and we're not sure if they are going to show up. Alex is a great guest. I'm sure there's something going on. We'll figure it out. If not, you get to hear me probably just rant and rave about this guy. Saw it right? Trump reports at least 1.4 billion in 2025 crypto earnings. Now let's talk about where that money came from. This is great. It's like a practice for the Daily Wolf Fun. $635.1 million in transaction fees for the Trump meme coin $236.3 million in World Liberty Financial token sales 196.9 million sale of ownership interest in the USD1 stablecoin venture. He's already sold his interest in the USD1 stablecoin Venture 65.6 million sale of part of Trump's stake in World Liberty Financial. So as that has gone to effectively zero, he made 65 million selling his stake 6 million casual 6 Melania Trump's NFT sales and collectibles business and about 511k in Ethereum validator staking rewards. Also holding a bunch of crypto to his credit. But you may ask, is this his personal disclosure? Yes, it was over 900 pages. 927 pages to be exact. Not that it's of any major consequence, but Obama's apparently was 8. Have not gotten the numbers on on Biden's yet but I found the best line by the way in the filing because I did a quick claude on it. Filing lists the meme coins value as not readily ascertainable but he got paid $635,668,835. So he got paid to the penny that check cleared. But we don't know what Trump Meme Coin could possibly Be worth. Oh, and by the way, they're still holding tons of these assets. That's literally just the profit from last year. Absolutely astounding. Since we're alone here today. TikTok. TikTok, I would love, because I know you guys are highly political in the comments. Tell me what you think of this. Tell me what you think. Is it illegal? No, by the way. So unless he was taking payments from foreign governments, which there have been, you know, obviously claims that they did that through the Trump token dinners and such like that, but does this bother you? Bother you? Do you think it's great? Do you think that Trump has been a net positive or a net negative for the industry? 1 Guys, go ahead, let's see it. Oh, Lagarde and Warsh are talking right now. That sounds bad. Lagarde also saying they dropped forward guidance. Something's brewing. Sounds great. So positive, negative. I like Trump. Still net positive. In my humble opinion, negative. I don't think it necessarily helped crypto. Yeah, you guys are all over the map, but I think that's fair. So listen, I think if we're calling balls and strikes, what I just described as a negative in that, you know, basically he was able to personally capitalize while giving the political opponents a lot of ammo for a future fight. The anti crypto army was dead and they were revived. So I think that that's a mass negative. And I said that from literally the moment the Trump meme coin launched. I've been very consistent on that. I said it that day. I said, Trump now controls crypto. I hated that he did that right before he came into office. But for calling balls and strikes, the positive is that we absolutely had to see an end to the Gensler Biden era. And at the time, that was even an end to Elizabeth Warren because she had seemingly lost all her power. And so him ending that was a massive, massive, massive positive. We could not have survived more, I think, attacks from the SEC and from the government. So I think that's massive positive. That now the Genius act itself, I think many people view as a positive. I'm not so sure, but I don't think that has anything to do with Trump. I think it's good that we were able to pass legislation and get these executive orders and all that. I think that's very, very positive. The question is, will we see follow through and will the Genius act have unintended negative consequences? As I've told you, the Genius act actually basically locked in surveillance under the bank Secrecy act by both the government and private companies into your transactions. Which I don't think is what everyone was thinking when we thought how excited we were about getting stablecoin legislation. So all over the map, you take the good, you take the bad, take them all. And there you have facts alive, facts of life. Who's old enough to have watched that show? I'm old. We don't know where Alex is. He's not here. You get me. So the, the next big story as I'm, I'm, I'm, I'm, I'm, you know, showcasing some new content that you might see on the Daily Wolf today. What do they call it when you're practicing? The words sticking in my brain, you know, housing something. No, that's not dress rehearsal. It's like workshopping. Workshopping some new content here. Feels like it's flat. Feels like you guys hate me, honestly today. So the next big story of the day, obviously if we're going to talk about Trump and stablecoins and the genius act is obviously this big breaking news, that big breaking Circle stock. It is this. Introducing Open Ooh S a day. I'm now only going to speak in Spanish. After Mexico's rousing victory in the World cup last night. Did you guys see by the way that a Mexico won and they went nuts. The whole country was celebrating. But the night before the game that they camped out all the fans outside the Ecuadorian team hotel and let off fireworks and made noise all night so the guys couldn't sleep. Amazing. That actually happened. True. So listen, yeah, Circle took a breather but opening introducing Open USD here. If you're wondering what this is, it's a pretty big deal. This is a new stablecoin coming from a consortium of 140 of the biggest companies on planet Earth. Not the biggest financial companies, biggest companies. Visa, MasterCard, Amex, Stripe, BlackRock, Google, Coinbase. Coinbase. This is an interesting one. Okay, so this is why Circle stop stock probably dumb. So as you know, usdc, usdt, those are the product but the business model is the float. And what does that mean? It means that we all use usdc. Usdc. Great. There's some minimal fees there, but the real revenue for the company is being able to custody those assets and put them into Treasuries and make money on high interest rates. So all of their money, I think it was in 2024. I haven't looked at for what they report for 2025 but over 90% something. 99% of revenue for a company like Circle comes from simply holding your money. And earning money on the interest. So you just custody as much. The more you custody, the more you make on that interest. Now, interestingly for Circle Specifically, Coinbase makes 100% of the revenue on that income on Coinbase's platform and about 50% of the revenue off platform. So many people will point out that in the disclosures you'll see I only have the 2024 numbers, but just sub billion, I think a $908 million or so Coinbase made in 2024 on Circle. And that was 54% of all of the revenue that Circle made. And that was still enough revenue for them to go public on. So Coinbase makes more money on USDC technically than USDC does. And that deal comes up in August and Coinbase just slowly shanking jail jail style Circle here. I can't say that's the case. Jamie Lair kind of disagrees. But Coinbase now is basically the leading, leading name in a competitive stablecoin that makes float no longer the business. So here's the interesting nuance as I'm thinking it through, kind of live. Yeah, someone says, didn't know it's Friday, it's not surprise, but I won't be here Friday. So ooh, you get this because it's a holiday Friday. We did this on purpose chant just the chance to give you what you wanted. So here's what's interesting, the way that this is structured, these 140 logos, which I doubt like a consortium of 140 companies can work. But they're basically saying that all of that revenue that's going to the issuer, the tether or the Circle will go to the companies that are utilizing it, as they utilize it. So you know, all of these companies, as their customers make payments or as they hold this or custody it, whatever they're doing, they're going to be the ones that earn it. So that make all your money on the float model is what they're trying to kill. But, but let's think about that, that in context of what I just told you about the Genius Act. So you guys will remember that the Genius act codified into law that the issuers Tether, USDC, I guess Trump sold his stake but USD1, they're not allowed to pass on yield to customers. Right? That was the rule. But once it leaves the issuer and goes to someone like, I don't know, Coinbase, they can offer right now under the Genius act, rewards and pass that on to their customers. Right. Kind of a big deal when you think about it. And that's where the banks are freaking out Jamie Dimon and all of them. They think that that same thing should be passed on where they're also banned from passing the yield on to their customers. But right now they're not. So we have this interesting situation. You have 140 companies right now taking advantage of what many of you as a loophole in the Genius act, because they are not the issuer. They can then take that money themselves and still not pass it on to us. So 140 companies now saying we can keep all of that for ourselves, not pass it on to the customer, which is effectively 140 of the biggest companies on planet Earth making a bet that the Clarity act does not pass. Because if the Clarity act passes with the current language, basically that prohibition, if you recall, will be extended to Coinbase and all of the third parties beyond the issuer. They'll be allowed to do rewards and stuff. They'll not be allowed to just get yield for holding. It can't replicate a bank deposit, all those things. So, like, I'm just saying, I was at 5% chance clarity act passes. These 140 companies that probably know more than me are clearly making a much more compelling bet. They don't believe Clarity is going to pass and that they're going to benefit massively from the way that the Genius act struggled. Struggled is structured. Struggled Is me structured? Is that so? Yeah. Oh, USD. Interestingly, there's been a lot of takes where Christian Catalini I saw from, who was kind of the brains behind Libra, which was the original Facebook attempt at doing something like this. He was a big fan of this because he thinks it's way more decentralized that this is the way that these should be structured. An open network was the way that these were intended. The issuer was never supposed to be able to make billions and billions and billions of dollars just for holding the money. And maybe we'll have kind of a broader network and this will be competitive. But just thinking, like, all the names that were included there, you didn't see Circle, you didn't see Tether, and you didn't see PayPal. Right. And so the consortium behind this is being led by the CEO of Bridge, which was the company that was bought for over a billion dollars by Stripe. It was one of the biggest payment companies. Right. And this is going live first on Solana. Interesting. And Tempo, which is Stripe's own blockchain. And after, we'll be kind of going down the list base, obviously, with Coinbase, Other. Right. So this is going to be kind of chain agnostic by the time it's done. And I think that we're now at the point where we've been just fully co. Opted. Okay, so what else was there to talk about today? I was counting on Alex to break down some of his own thesises. Thesises. Let me bring up a tweet that I sent earlier because now. Oh, hey, he's here. Alex. He's almost here. He's a blank. Now he can break down his own theses, theses, theses. It's like feces. Thesis is a thesis. Thesises. He's kind of here. We want to see what he looks like. It's not really. We've got half. Alex, I'm going to drink this Lacroix and you guys are going to awkwardly watch me do it. Does not taste like key lime pie. I'm not sure if he's going to be able to actually get on. Seems to be having some technical issues. I want to show you some charts real quick because I find this just so interesting. Now you guys know, you know, I think technical analysis is wonderful as a risk management tool, but largely, you know, it's astrology for men. But I love it. I love it. We all love it. I just want to show you something that I'm not sure I've ever seen before. So if you follow me for a very, very long time, you know that my favorite signal in the world of bottoms and tops is RSI being overbought or oversold and having bearish or bullish divergence with that. And the more timeframes the better. So what I generally like to look at for bottoms, taking out all the sentiment and other reasons that I've told you that, you know, we could, could be bottoming is when they build from low timeframes to high timeframes. So the four hour is not shown here, but here's the six hour, right? You have the huge one there. I'm not sure that counts. But now you even have a local bullish divergence right there. Right? 12 hour. What did I do? Sweet. Whatever I did, it was sweet. 12 hour, the big one and another little one forming right now. That's yet to confirm. Take a look at the daily. You had the one that confirmed there, which often happens, drops lower. Now waiting for another one to confirm. And of course the weekly you had a massive confirmed bullish divergence and now dropping lower and giving you another potential one. Does that mean the bottom is in? No, but it means that my favorite thing personally to look at that. Has a very high hit rate, but is not guaranteed. Looking really good. Looking really good. And like, when you add in the fact that I think we saw a fever pitch last week, I don't know. Did you guys see yesterday I did kind of a debate or conversation on Defiant with Cammy Russo and myself and crypto Kleo and he kind of took like the, I guess the bearish side of the strategy argument. I guess I took the bullish side, although I don't really know that that's what it was because I. I concede a lot of things were done wrong and a lot of points. I don't know if you guys saw it. If you didn't, you should. But my point there was, I think that the sailor hate reached a fever pitch last week. While we have crypto fear and greedy low, while we have the most coins in history that are out of underwater, out of profit, while we have the 200 ma on the weekly, while we have the 50 ma on the monthly. Literally, like every single bottoming signal that nobody ever believes when you're actually at the bottom is there right now. And this is just, I think, objective truth. And so, yeah, we got into this sailor debate. And the one thing that I thought, like, if I thought I made one really good point that kind of came off the top of my head to stroke myself a little bit, okay. He said, you know, she asked him, you know, what, what should Saylor do, right? And this is all, by the way, after their plan on Monday, which I think should reasonably calm the market quite a bit, but what should a sailor do? And he said, you know, he should sell a bunch of bitcoin right now while the market is where it is, while he can and get billions and have years of Runway and close the converts and all this stuff because, you know, eventually they're going to have to sell bitcoin and it's going to destroy shareholder value. And the thing I still can't get are two things. A, everybody's base case is bitcoin can't go up, right? If bitcoin goes up, none of this is literally an issue, okay? So, but everybody thinks bitcoin only can go down, apparently. So, like, that's not even an argument, apparently. But number two, the argument I do not understand of selling a bunch of bitcoin now that people have continued to make is if he sells a ton of bitcoin now, he automatically destroys shareholder value. And their argument is that he needs to sell to protect from selling, to destroy shareholder value, right? So there's this big assumption that he will be forced to sell at a super low price later. And I just don't. I think that the things that he did on Monday probably. Alex. Good morning, sir.

[B]

Sorry, so sorry for being late here. Scott had a combination of traffic and, and technical details, but I've solved them.

[A]

What you might not know is that I'm just amazing when I wing it.

[B]

I was listening. I was listening.

[A]

I don't even know what I just said. I think I blacked out, to be honest.

[B]

Well, I heard you talking about Michael Saylor and Circle and Coinbase and the competition on Stable coins. I love that part. I think it's a big, big question.

[A]

Give me your, give me your thoughts because I'm sure I had some good takes, bad takes there. So like you can jump in on all that. And then I want to kind of talk about a few things you've written.

[B]

Yeah, absolutely. The. Well, look, you have the announcement of this, oh, USD Open standard. I have to say, and I should be clear that Galaxy is one of the, I don't know, hundred of companies that are part of this consortium.

[A]

The best one.

[B]

Yeah, I would. That's what I think for sure. I would say, you know, I think what the ARK analyst wrote is true, that there is no history of a consortium stablecoin. I think Jeremy Lair wrote this today as well. On X I saw there's no history of a consortium stablecoin doing that. Well, the other one, USDG is like 10th by circulating supply. It's fine. But now, that being said, there's not a lot of history in stablecoin history.

[A]

Zebra kind of tried, right. I mean it was a Facebook coin, but I remember they had all the logos.

[B]

Yeah, they did have a lot of logos and. But if you look at the supply, right, Tether's at like 180 billion, Circle's at 75 billion. So you know, less than half the size. And the next biggest is Sky USD, which is like MakerDAO at 1/10 of that 7 billion. And then the next several coins are all defi stables. So we're talking a literal order of magnitude between number three and number two, two being Circle. So there is a clear market share dominance by Tether and Circle here. So no matter who it is, it's going to be tough for a competitor to take share from those two. I think the play here has to be that in a genius ax stablecoin world that everyone and all the banks and you know, the supermarkets are all going to be using stablecoins and then surely there is a much larger total addressable market than the stable coins today, which are predominantly servicing the crypto markets and the crypto trading markets and some cross border payment stuff. So I think there's definitely a possibility of any new entrant, let alone one with a roster of such prestigious membership with so much distribution power. But again, like this is an uphill climb for anyone. We don't have, you know, for something called open standard. No offense to them, but we have exactly zero information. We don't have a white paper, we don't.

[A]

Asian Reduction Act.

[B]

Yeah, exactly. We don't know anything about it.

[A]

Names ever.

[B]

Yeah. So I, I would say I'm cautiously skeptical. I'm not. You know, I don't think, I think Jeremy was a little bit defensive in the way he wrote his skepticism, but I think that's fair. Like, you know, the market needs. There's no evidence that this type of thing has worked yet. It doesn't mean it can't. And there's also no information really either.

[A]

So yeah, I mean, I could bring him up. I don't think we need to. But yeah, I mean, I think he was like, listen, I'm sure if you're sitting in his shoes, this massive announcement comes out. Right. And then you see all these aggressive takes.

[B]

Yeah.

[A]

And you probably know that some of them are wrong and you're just sitting on your hands like wondering what you can or can't say. Maybe I'm wrong about the Coinbase take. That seems to be one of the biggest angles there though. I don't know if you have a specific feeling on that. But obviously everybody knows Coinbase kind of makes more money on USDC than Circle does and their name is really big on this consortium.

[B]

Yeah.

[A]

Right. And the deal comes up in August.

[B]

Yeah. I think they're going to keep using Circle. I don't think it's like a hint that they're getting ready to drop or anything. But I think one thing that Open Standards stated, again relying on basically a press release here to comment on it and nothing more. The, the idea that, you know, the stable coin rewards are actually going to trend lower even if rates go higher and all that, like in general, the, the idea that the issuer is going to just keep all the rewards is, is probably going to trend lower. It's going to be a race to the bottom, even if just for pur competitive reasons. Right. That like the issuer that keeps the least of it is ultimately the cheaper stable coin, even if it's just a Few basis points right at scale that could matter a lot. And I, so I sort of look at it that way that Coinbase is, I mean think about it. They, they are fighting. Coinbase is the leader fighting to give stablecoin rewards away to their clients in the Clarity act fight. So they've already basically signaled that they would pay give up the economics of the stablecoin just to acquire customers on their platform. I think that, I think about it that that's sort of the take I have versus OUSD versus USDC on Coinbase. Not so much that they're you know, leaving Circle. I mean again, Circle's USDC is very entrenched there, but more that it just shows that like again like the, the economics of the stablecoin issuer are eroding.

[A]

Yeah, I agree. I think that that was kind of the point I made earlier is that the like you know, USDC is the product but the business is float. Right. And that that business is over.

[B]

That's.

[A]

And I don't know, maybe I'm more cynical, but it seems like it's 140 people getting their piece of the float and still not passing it on to the customers because the Genius act allows that. And I took it as a one step more cynical. I know that you guys like everybody kind of tracks. You've made it into the main headlines of Odds of Clarity Act. It's like polymarket Alex Thorne.

[B]

Yeah.

[A]

At any given moment. Right. And I've seen them give kind of sliding to maybe 50, 50 ish. I don't know where you stand now. I've added it like 5%. Like maybe I'm cynical but I feel like this is 140 companies kind of sort of saying it probably won't pass and we can make money on the way it's structured in the Genius Act.

[B]

Yeah, maybe. I think you're definitely right that the odds are declining. I think I try to give like really granular like in the moment mostly because our clients and counterparties, they like to trade volatility. Right. So they want to know like at this moment what would I price the odds. Right. It has been declining. I think I'm the only. But you're not wrong. One of the reasons I'm in the headlines is because I'm the only analyst at like a crypto stakeholder that covers this publicly. Right. Most of the crypto firms are too folk, not too focused, solely focused on advocacy. We also, I mean I want it to pass. I do a lot of work and watching to try to help this bill become law. But I also cover it the way like a bank analyst would cover it. I don't, I don't know if OUSD is necessarily a bad. I think this, look, I mean, this thing.

[A]

Yeah.

[B]

If clarity somehow passed and their business model here was bricked, then great. They haven't done anything. It's just a press release. Right. So it's maybe some optionality in the face of clarity. I think that's a reasonable way to think about it.

[A]

Yeah, totally agree. So listen, I want to talk about, obviously, as you said, you're deeply entrenched in the markets. You're analyzing this every day. You had this tweet here, you know, last week was the lowest net flow in our institutional adoption versus OG distribution chart, pushing the cumulative distribution since October 2025, all time high to 154,169. Bitcoin people can obviously look at that chart here, but the, the chart's less interesting than the signal or what it's telling people, Right? Yeah. What does it tell us?

[B]

I, I love this chart because it marries like ETF flow data and on chain data. So the, the OG distribution that we're talking about, that's the, the like blue lot, the blue bar, the light blue bar. And that, that's just for five plus year dormant coins moving on chain. Right. So we all know that the majority of bitcoiners are Hodlers. And usually if you move coins around, it's because you're selling them. Typically, I mean, you know, that really I think is a fair heuristic. Obviously you can be shuffling them in your own cold storage or an exchange can be moving their coins around inside cold storage. And it's not a sale. But I can tell you that if you see coins flowing from my wallet, I'm selling them. And you won't because I haven't sold in more than 10 years. Right. So if you did see them, it would be irregular. So anyway, that's the heuristic that the OG distribution. And then we pair that against ETF flow and mstr. Buying, I should say, or selling. It's either side. And the net is that dotted black line. And I like this chart because look how well the dotted black line follows the price. Right. Like this. The, you know, and by the way, if anyone has, you know, I, I could add strive or other net accumulators or other heuristics like I would always love to know. I'd like to add more the scale of MSTR and the ETFs is comparable. Like the other DATs are not comparable at that scale. So. Yeah, yeah, but the shape of this is pretty clear. Like people. And again, this is like what Eric Balchunas has said, a lot like the call. Now it's ETFs as well. But for a while ETF holders were holding pretty strong. It's really been in the last few months that the net outflows from the ETFs have accelerated and. But the OG, the five plus year dormant Bitcoin. Those are people that bought Bitcoin in 2021 or earlier. Right. This is the call coming from inside the house. There are people, not all bitcoiners obviously who are, who are capitulating at these prices.

[A]

And we've seen that. Or capitulating or. Okay, I think it. So let me ask you a question. When you look at this, I think at this price it feels like capitulating if they're still selling. When they were selling over 100, it was locking in their games in massive like generational wealth. Right. So is there like, can you see a difference in those cohorts by the way? Or is it. Are they kind of just lumped together

[B]

by side in this chart? You're right, actually, I should say if you're selling from five plus years ago, then at this point you're sort of throwing in the towel. You might still be up. Well, that's right. You might have bought like in, you know, around 30 or 40 or 50k in 2021. I should be clear that you could have bought five plus years ago. That could be 2011, 2013. Right. Like because it's five plus. But I. You're right, it's not necessarily capitulation. If you bought at 125 and you're selling at 58k today, that's capitulation by, by definition of the term. But we've seen a lot of that as well.

[A]

I had seen some charts, I don't have them in front of me that indicated that like in the past, even couple days or weeks, like a lot of those wallets were adding and not selling.

[B]

Yeah, it's true that long term holder bitcoin, so which is a statistical. I always use this. It's actually only addresses that have held for 155 days or more. This is, I think David Puhle from ARCS methodology in their coin time research showed that honestly like statistically speaking, if the, if the coins don't move for 155 days, they don't move for a long time. And so like that's the statistical pivot point. I think it's at an all time high, the amount of bitcoin held by long term holders. And also the realized cap of long term holders is at an all time high, meaning that they're comfortable buying at higher prices. So I mean this is long term. This is what always happens in a drawdown. Like short term holders sell coins to long term believers.

[A]

Strong hands.

[B]

That's exactly right. And look, I mean 58k gang turns out to have been real, just a bitcoin meme. And they're defending 58k here. Honestly, this whole time so far, you know, I don't know that it will. Bitcoin will stay above 58k. But that's a lot higher than 15.5 where we bottomed in 22. It's a lot higher. You know, I, I'm still, you know, this looks like a pretty classic drawdown now. And with a higher floor and like that people ask where the, you know, the people who are using bitcoin as digital gold, where are they? They're here. They're the rising floor. All the other stuff, the parabolic blow offs, all that stuff is speculators on top of what is very clear. Clearly a global growing and diversifying holder base.

[A]

What do you think about Saylor?

[B]

I think he just opened up every possible option for himself. I think that is smart. I don't think he should sell bitcoin is my view. But I think he's also got an enormous amount of capital. So the doomerism around it is definitely overblown in my view. He's got tens of billions of dollars of bitcoin.

[A]

I love when I hear words like bankruptcy and insolvency.

[B]

Yeah.

[A]

Holds almost 5% of all the bitcoin on planet earth. And dumb ass influencers are throwing out. Bankruptcy is a word that they actually applies.

[B]

And he is, look, he has introduced leverage into the capital stack with stretch and stride and strike and stream I think is the other one in Europe. But again the liabilities even from those, let alone the converts and other debt that he has in 27 and 28, they come nowhere near the value of the bitcoin.

[A]

Right.

[B]

It would have to go so much lower for like so much lower for it to even have any kind of material impairment in his ability to service those obligations. So it's a very small amount of leverage relative to his bitcoin stack. I think the fear, this is why I don't want him to sell bitcoin one because he Said never sell your bitcoin. And I, you know, I know he clarified. He meant. He meant us and not him, is what he said, which I didn't think was a helpful comment, but he's had some.

[A]

He's had some poor zingers.

[B]

Yeah, I. I think that there is. If he starts selling bitcoin, he can create a virtuous, A vicious cycle that. That. That does harm his capital stack more. I think he's. He has other options. I Like the announced buybacks or possibility of buybacks for the preferreds, I think makes a lot of sense. And, you know, I'd like to see. They said BTC monetization plan, and then they only said selling. But there's a lot more that they could do, you know, or.

[A]

Or.

[B]

Or do sort of like options trading strategies that are fully protected and generate income. So I. I would like to see them do that. But either way, I. I'm happy that they've been listening. You know, I saw cj Their IR guy has reached out to a lot of people and sought advice. They've been very open with people seeking advice.

[A]

So he had that tweet. See, Jane, that's the. Yeah, C.J.

[B]

yep.

[A]

Listen, I've been pretty much like, in the defending sailor category, but he had that tweet that said that they're, you know, they were like an indestructible fortress or whatever.

[B]

Y.

[A]

And I retweeted, and I said respectfully, you know, like, nobody wants to see this hubris. You have to know your audience. We all have PTSD of, you know, steady lads, deploying more capital and. And, you know, I'll buy all the salon that you have for $21 or whatever. Right. That comment, even though probably true, reeked of all of the spidey sense tinglers that we've had in the past. And he got so much pushback on that, even from the supporters, that all of their tweets now have been, like, entirely humbled. You know, we're listening to our investors. We care about you. Please give us their feedback. And to me, that's half of the biggest signal. I don't know if you heard. I was talking about it before, but like A. I 1000% agree with you. They now are very clearly not a raise cash. Buy bitcoin immediately at all cost company. I think the best thing they could do actually right now is just do nothing for a very long time. Just don't buy bitcoin, don't do anything, and then the market will forget about the fud because they have 17 and a half months of Runway minimum. I think that's probably the best thing. But what do I know? But I think the hubris is gone. I think they're going to have humble messaging and I think that they don't need to sell Bitcoin now. And I keep arguing with the. Sell Bitcoin now to raise capital people, because it's of the exact circle you just said. If your concern is shareholder value being destroyed through selling Bitcoin, then why would you want them to sell Bitcoin? To prevent selling bitcoin? To destroy shareholders.

[B]

Yeah, I totally agree.

[A]

Bitcoin to 35,000. If he sold a few billion worth right now.

[B]

Yeah, I totally agree. I think that's the worst option. And you're right, Scott. I think it's. This is a true, this is true. In life, sometimes the hardest thing to do is to do nothing. Traders, good traders will tell you this all the time. Sometimes being not in a trade is the correct trade. I think you're totally right that that's what he should do. And I agree. There's no, there's no reason to call for them to sell bitcoin. They don't need to sell bitcoin. They have tons of cash now, of course, after, after their market operations, I guess last week that they announced on this Monday. And I, yeah, look, the indestructible fortress of a balance sheet. I think CJ's trying to say what we're saying. We have a ton of bitcoin guys. It's not going to be a problem.

[A]

Language matters.

[B]

But I think you're right about the language and it's been nice to see them be a little bit more humble about it.

[A]

Yeah, I would hate to see it them sell a bunch more. They have enough, you know, and I think sometimes I, I use the example yesterday, I think I said like, if you're fighting with your wife and you step out of the room for 20 minutes, you don't come back in, like throwing out the same arguments. You give it a little time and let it calm down. And I feel like exactly like they're fighting with their wife, which is the entire bitcoin world. But what I do think that one

[B]

hits home for me, Scott, that.

[A]

But I think what the, you know, makes a lot of sense to kind of do it. Even some of the biggest critics looked at what they announced on Monday and were like, okay, I guess we'll talk about this in 14 months. Yeah, or in 16 months. Because if they're under pressure In a year. You know, if Bitcoin's at 30, it's always been duration, risk for anybody who really looks at this. So like if we're a year down the road and Bitcoin's at 30 and it's been there for a year and they have four or five months of Runway, there's going to be a real conversation to be had. But like, why would you preempt that if that's not the base case scenario?

[B]

Yeah. And I, I have to say I don't think it will be. I don't think, I'm sure they don't think it will be either. But also, you know, it's kind of the double edged sword of their, their Michael and their language during good times. Right. You know, like, I don't think anybody should be surprised to see a bitcoin vehicle like strategy need to what, become a little defensive during a 52 drawdown. That's obvious. Yeah, that's totally normal and fine. It's kind of just because they were, it's always been very, you know, they were too strong on the upswing and not, you know, and, and that we, they condition the market to not realize that this could happen. I think it's incredibly prudent what they're doing.

[A]

Yeah. And I also, there's the like the endless argument about them diluting microstrategy shareholders strategy shareholders. So a, like just because you're diluting for a couple weeks doesn't mean you're diluting on any kind of longer timescale. Although I do, I am sensitive to it. I think it's a. But also like, you know, people, by definition, they're still diluting shareholders at the top when they're trading at a premium and selling shares to buy something.

[B]

Right.

[A]

Right now when it's at a certain premium, but it's still dilution when you print money in shares to, to do something else with it.

[B]

Yeah, I agree. And I, you know, I can't speak like, you know, I can't, I don't know. They're, they're thinking on this. Exactly. But from my perspective, they've been pretty straightforward and clear about disclaiming that they're going to use the ATM at mstr. Like, I think people know that.

[A]

Yeah. I think the one thing that they also probably realized to our point is like these past couple of weeks where it was like we're going to buy a couple bitcoin and raise cash. It was like they were holding on for dear life to the narrative that they would buy Bitcoin under any circumstance. So I think them not buying alongside this announcement was also a pretty big.

[B]

It is one of the ironies of the vehicle. Right. When, when Michael told Laura all those years ago that it's going, I'll be buying the top forever. It's going up forever, Laura. And he said he'd be buying the top forever. I think what he meant at the time, it's sort of like, you know, you're always buying the top of real estate because real estate's just always gone up forever. Like you're always upset. You always bought your, your house at like the market top. It's pretty common. And that's sort of what he was saying, that it will be going up forever and I'll be a buyer forever. So I'll always be buying the top. But I think one of the ironies is he is structurally much more. It's much easier for him to buy the top in the capital markets. He doesn't have the M Nav premium or the convert and bond buyers like beating down his door in a bear market. Right. So the irony is that he's actually, of course he should be buying more when it's down and less when it's up. That's what a normal investor or portfolio manager would be doing. Right? You want to be buying the dip if you have a long term view, not buying the top. But it's just an interesting thing about his structure here that it's much easier for him to buy the top than it is the bottom.

[A]

Yeah, I agree with that 100%. I think people just get very lost in the jargon and they kind of put this metric as bitcoin per share as the holy grail. But hey, that changed. I could even make an argument, by the way, for like, I would almost rather. Okay, if I'm not looking at bitcoin per share. I would almost rather a company be buying the bottom by diluting slightly than buying the dead top. Because there's a bigger premium long term. Don't I want them to hold more bitcoin and get it here while price is low? I know that the math. If you're doing bitcoin per share, buying it at a 2x premium at 125 is better than buying flat at 60. But if that's not the right metric, don't you just want them to get as much bitcoin? Like if I'm a strategy shareholder, if he can get a lot more bitcoin right now by slightly diluting me and I believe long Term. That actually might be something I'm excited about.

[B]

Yeah. I mean, that's my view also. But, you know, look, he's created his own. His own crazy thing. I mean, I have to give them credit. I don't know about each of these metrics. Like, I'm personally not an MSTR shareholder, but, like.

[A]

Yeah, but.

[B]

But I. You know, we. You know, what can I say? The guy has amassed, what, over 900,000 Bitcoin. I mean, I haven't done that. Clearly, he's figured something out. And it's. It's.

[A]

But also, I roll. Talking positively about him. Throw some bitcoin, Mike.

[B]

I mean, last week, this was the talk of the market. Not just on X, but, like, all of our clients and counterparties are all pestering me to what's my view? What should Michael do? Blah, blah, blah. And that has abated. So I think this. Yeah. This announcement on Monday, at least, again, setting aside strategy. Like, I don't work at strategy. I'm not in charge of their strategy. But for bitcoin, I think this is really de risked the. There was a big view in markets that, like, oh, sailor. And strategy has to resolve before bitcoin can go higher.

[A]

Bitcoin can't move without strategy.

[B]

I think this was a big.

[A]

This was like Satoshi selling all of his coins, right? A million coins hitting the market.

[B]

Yeah, this was a kick the can. He didn't somehow structurally really alter the situation at strategy, but he kicked the can far enough. I think that the market can calm down here and now we can decide, you know, where we want to go on BTC price. So I think it did de risk it a bit. It's not fully resolved in the market's view. But, I mean, like you said, what, 17 months or. He's kicked the can now pretty far. If he literally does nothing for. He's got almost two years of Runway now to do nothing if he wants to.

[A]

Yeah, I don't think he needs to do nothing for two years, but I think a couple weeks might. You know, like I said, you just don't. Like. You don't want to. You can't be the main character forever here. You got to just, you know, kind of back off once a few weeks if it calms things down. But I. I'm really excited to hear from you that what I've seen anecdotally, which is that, like, it reached a fever pitch last week and people aren't asking you the question.

[B]

Yeah, it's received.

[A]

What are they asking you?

[B]

Yeah. Thank goodness.

[A]

I mean, this week, what's the, you know, is China gonna ban like, you know, we're boiling the oceans.

[B]

Yeah. The heat wave. I mean, that's New York is 95 degrees today. You know, I, I think, look, I mean you got, I think an announcement sometime today we're expecting from Robin Hood about their Robin Hood chain, we've been told. So that, that could be interesting, I suppose probably, you know, in the vein of the tokenized stock questions. You know, Coinbase had their big announcement like a couple weeks ago now, I think two weeks ago. Both of them have a, like an exchange controlled L2. What is that going to be used for? Is this really the topography that tokenized securities will look like? So that's one thing we're looking at today. We are looking and thinking about the stablecoin discussion that you were having before I joined and that we had about myself. Yes. With yourself again. And you know, like, what does the topography of an end state in stablecoin world look like? Well, you know, a lot of markets are like one big player at 60%, a secondary player at 30 and a long tail that fills out the 10. There are many markets that look like that. That's what stable coins look like today look like.

[A]

That's what Bitcoin ETFs look like.

[B]

Exactly. So like it could, could it look like that? I don't know. And maybe, I mean that's what the transfer agent market is. Computer share is like 60%, EQ is like 30% and everybody else is a combined 10%. Right. There's. It's a very common. It's probably like, you know, the Fibonacci sequence or whatever. It's probably like some natural phenomenon, you know. But is that what stable coins look like? Can something like, oh, USD or you know, God forbid, JPM coin like upset that balance? Like that's something we're writing about this week as well. And then also just continue to look at GPU markets. We're going to start covering like, you know, what about token. It's kind of time. You know, the tokens that we used to like, Scott, aren't the only tokens in the game. Now there are other digital currencies called tokens that power AI models. As we all know, we're going to start covering this a lot more with research. We're looking now at like tradable GPU compute markets.

[A]

Interesting.

[B]

So we'll have something coming out about that soon too, I guess.

[A]

You know, if our miners are all going to become AI data centers, then you know, like honesty like ours has.

[B]

We are a big data center firm now and no longer a bitcoin miner, to my chagrin, you know, because it's dear to my heart. Although there's a lot of fascinating research and of course those in the business know this, but the per dollar like revenue from compute is substantially higher than the per dollar revenue from bitcoin mining. Even down at these, you know, even down at this hash rate. And bitcoin miner is having a. It's a big story this year, by the way, that no one's really covering a lot, but like go look at bitcoin hash rate. It's down substantially from the top. The downward difficulty adjustment that we recently had, I think last week was, I think the 10th biggest single downward difficulty adjustment in bitcoin history. Miners down at these prices, getting squeezed for sure.

[A]

I mean, but that's one of those. That's another one of those potential market bottoming signals is minor capitulation and, you know, difficulty, you know, and price of big. All those things. I just see a lot of those things, man. It's like, you know, when paired with. I was saying this before you got on and we'll go in a second, but like, just feels like nobody's base case is bitcoin can just slowly float up.

[B]

Yeah.

[A]

I mean, I think that's consensus that it has to die now. That feels so much like the bottoming process.

[B]

I agree. I absolutely agree. And I think you're in it and. No. And you've got people like Grantham and others just like coming out of the woodwork whose opinions on bitcoin we never cared to know and heard of it. Yeah, they always come out at the bottom. I think we're. We're near the bottom, if not at it already. I think we are totally somewhere nearby here.

[A]

Can't think of a better way to. To wrap. Alex, I'm sorry you got stuck in traffic and everything. I appreciate you still making it because we needed. We needed that insight for sure. And we'll have to do this more thoroughly again in the not so distant future.

[B]

Thank you, Scott. Sorry for being late. Thanks for having me.

[A]

You're good, man. Thank you, everybody. We'll see you later. That's DOP.