Bitcoin Tumbles After Smashing All-Time Highs! What's Next? - The Wolf Of All Streets

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[00:01]
A
Bitcoin just smashed through its all time high yesterday hitting almost around 124,000 to $125,000. Will this momentum continue? No, no it won't actually. Clearly the momentum is not continuing because Bitcoin is currently trading at 118,441American inflating dollars. What the hell just happened? We break all time highs, we're supposed to have blue skies and continue on up to 150, then 210, then 4 million. It didn't happen. Largely because of PPI and technical indicators showing maybe the top was in. We're going to talk about that. All the news in the market today with my amazing guest Sid from Maple Finance. Let's go, let's go. Good morning everybody. Happy all time high for 10 minutes day. To those who celebrate, we did have an all time high yesterday in bitcoin. Ethereum couldn't even get itself together enough to break its all time high. Coming up just short. And now of course we have a market wide correction and retrace going to bring on Sid right now. Good. More good evening. I say good morning for you, but you're on the other side of this planet, right?
[01:27]
B
Right. Good. Well, yeah. Good evening. Glad to be here.
[01:31]
A
Late night for you, I think. Okay. Okay. So Bitcoin goes up to $124,000. There's celebration, everything's great. I wake up, it's like 121 or something. Okay. No surprise, you know, if you trade markets, you know that there's resistance and all time highs, blah, blah, blah, whatever. And then PPI hits, right? PPI month over month, hottest since March 2022 as services PPI explode higher over half the increases attributable to margins for final demand trade services which jumped 2.0%. So basically they expected 0.2%. Yeah, 0.9%.
[02:05]
B
9.
[02:07]
A
Last week we had the CPI numbers 100% rate cut priced in on predictive markets and Fed tracker. Now it's a week later and everyone's like no, no Fed cuts in September. When have any, has anybody been right in the last two and a half years about Fed cuts?
[02:23]
B
No, no, this is, this is, you know, a point going to the, the nothing ever happens crowd. You know that guy who, who just bets on no change is ever happening on poly market right now. Yeah, yeah, yeah, yeah.
[02:42]
A
I mean, but listen, these are, we know that these all are blips, right? Every day we get a new, some sort of government data headline. Nobody believes government data apparently anyways, because I, I'm actually Wondering who gets fired today. I was just going to say literally who gets fired today? Because that can't be. Right. Right. But listen, in the midst of all this, I think let's talk about the actual narratives for bitcoin and crypto and the reason that it was even pushing to all time highs in the first place. We clearly have crypto IPO madness, I think is sort of the story. And treasury companies, right, we know exactly who the buyers are in this case, we know exactly where the interest and money are coming from. But here, the latest sign of crypto IPO boom might be coming. 10T Holdings. Dan Tapier predicts crypto listings on exchanges are a mini step for value moving on chain. Okay, whatever. Point being, the other article we have is that basically on the back of Trump being extremely bullish on crypto, we're seeing launches of companies left, right and center. And the biggest one, crypto exchange, bullish price IPO at 37 per share. It went up to like 118 bucks.
[03:46]
B
Yeah, I think that's where it topped down.
[03:49]
A
I mean this pulled so, so this pulled a full circle. Like, I don't mean full circle, I mean fully went circle. It actually launched, I think Circle was supposed to launch at like 29 and launched at 32 or 33 and went over 100 on the first day of trading. This did the same thing.
[04:05]
B
Yeah, yeah. No, I think, look, and what I, you know, what we're saying is that IPOs in general are up, I think they're up 53% for the year so far versus versus same time last year. But we, we are seeing real interest and you know, clear Demand for crypto IPOs. You know, we've seen the outperformance of Circle now bullish. We know that, you know, we know that there are other crypto IPOs coming. I think Kraken's, you know, it's no secret that Kraken is going to be coming to market. We've seen Gemini, I think Gemini had also done a confidential filing to, to IPO as well. So I think as long as the market keeps receiving them like this, and, and they, and they trade this well on the first day, you're going to continue to see more of these IPOs coming. And it clearly shows demand among institutional app, institutional investors as well as retail investors, because we know Circle was particularly well received in Korea as well.
[05:05]
A
Yeah. So here's the article showing the actual price action success of it. It opened, it ended up opening at 90. I mean it's really like just wild demand for this. And listen, let's be honest. Like, I know and like the people from Bullish. This is not an exchange that's on most people's radar. Right. It is Peter Thiel backed. They own CoinDesk. Like they've got a lot of things going, but nobody. This isn't a name brand retail exchange like a Coinbase or a Kraken or even Circle. And it still pulled the same crazy multiple. Like.
[05:39]
B
Yeah.
[05:39]
A
Does that just mean there's literally demand for anything that says crypto that can get on Exchange right now?
[05:46]
B
Well, I think it indicates there, you know, there are plenty of companies within crypto who should be looking to go live right now. I mean, as you said, Bullish doesn't do the most volume among exchanges in terms of the leaderboard, but, you know, it does have a few, you know, high profile assets. Like, I think it's generally a pretty well run exchange, has a really strong management team. They've got the CoinDesk brand under them and, you know, and then of course they have the Peter Thiel backing. And I think that counts for a lot with investors. But this signals that there's obviously rampant demand among investors. So Kraken should get their skates on. Gemini should get their skates on these. You know, these are also high profile names that you would expect to do as well. If not. If not. If not, better. Just given that they do. Given the volumes they do.
[06:34]
A
The volumes they do and their. And name brands and who's behind them. You know, like Gemini is a Winklevoss twins. Those guys are going to generate an insane amount of interest. Kraken, obviously one of the largest exchanges in the United States and been talking about them going public for years now. So clearly a very good environment. Hey, do you know how you can always tell. Go ahead.
[06:52]
B
Yeah, I was going to say it'd be interesting to see if, you know, if we kind of progress through this trend in this cycle the same way we have with the treasury Companies, what the 10th or 15th company to IPO will be in the crypto sector.
[07:08]
A
That's our next topic. Perfect segue. But I just want to ask you, do you know how you can always know when the top is in temporarily for any asset? Do you know what the indicator is?
[07:18]
B
Uber, Uber, Uber.
[07:20]
A
That's one. The one that I find to be the most compelling, they'll never do again is showing your portfolio or bragging to somebody, like pulling up your portfolio and showing them how well you've done, like showing your wife how much money will always be the dead top, always the top signal. Michael Saylor Today's strategies Bitcoin holdings close at an all time high of 70. I know he doesn't have a wife. Oh boy. But you know, no, I mean literally right at the top. He hit it with the brag.
[07:48]
B
And the other, the other one you've been seeing is Bukele from, from El Salvador. You know, every, every now and then we'll post, post his portfolio.
[07:57]
A
Yeah, he, his has been working out clearly on, on the way up better than this. But yeah. To be serious though, let's talk about the bitcoin treasury companies. It's my favorite topic. I love to get each person's take on how it will play out. I was a huge skeptic at the beginning. I do not like leverage on bitcoin. I don't see what the point is. I don't really understand the massive premiums to nav but I came around to think it's less of a systemic risk to bitcoin and more just a risk to the ones that fail. And there's shareholders. Right. I do think there will be some bitcoin selling but generally probably just blow up your company and end up at a discount. You have an interesting premise I think that I share on how this might play out.
[08:41]
B
Yeah, yeah. So my short term view is that there's going to be more of these because the market's saying that it, it's still willing to, you know, willing to, to absorb them. Absorb them and, and entertain the concept. So I think short term we get more of these. Currently they trade at premiums. I think over time that is going to trend towards a discount and you will see the stronger ones that trade at a premium. Let's say strategy will acquire those that trade at discounts because if you look at it, let's say Sailors Strategies trades at a 2 to 1 multiple. He can effectively sell $2 of stock which, which represents $1 of Bitcoin to buy $1 of Bitcoin for 50 cents. So he's effectively getting a forex benefit instead of a 2x benefit. So I think that's the natural progression of where this goes over time. And those who say these will never trade at discounts. That's what people said about grayscale in the past.
[09:44]
A
Let's talk about that because I hear that narrative constantly. How can you trade at a discount if you hold the bitcoin? How can your stock be worth less than the net asset value? Stocks have this funny way of being irrational in trading on their own. Regardless of the underlying fundamentals, just like crypto do. And it could easily happen. Now. Grayscale was a little different, only because, like, people literally couldn't redeem, so it was at a discount and people couldn't get their money out. So it sent a much bigger discount. But that was down to 50, 60%. There's nothing to say these can't go down 5, 10%, which would be, as you said, a huge discount for anybody who has dry powder. Jack Mehlers. Actually, I asked him, like, at Bitcoin Vegas, right when this trend was hitting hard and he had just launched 21. I was like, isn't this like a systemic risk? Isn't this bad? He was like, I hope they all blow up so I can buy them. He literally said it.
[10:34]
B
Yeah. Which, you know, which. Which is totally, like, totally logical and sensible for. For anyone who continues to have a premium to. To do and anyone who remains, you know, well capitalized. But for those who think that you can't trade a discount when you still got the bitcoin, I'd point out that, you know, it wasn't so long ago Yahoo traded at a discount to the value of their Alibaba holdings. Right. Which suggested that the market viewed that Yahoo was actually going to destroy Alibaba value, even though they held liquid Alibaba shares on their balance sheet that were worth more than the entire value of Yahoo at that time.
[11:10]
A
Yeah, it's crazy, but we have plenty of examples that will happen. I wonder if it would actually be Microstrategy that buys them up or if it'll be like Nakamoto in 21, or if they'll all kind of the early ones with the big money pump, you know, a billion bucks. I think if there's waiting. My knowledge, a lot of them haven't even bought much Bitcoin yet. Yeah, they're waiting for regulatory clarity or approval to pivot the companies that they took over.
[11:33]
B
So, I mean, we've been speaking to a few of them. We, you know, I think we make no secret that, you know, we would be interested in lending to a number of these companies in, you know, in. In. In that we can provide them with capital that's a lower cost of capital. So no doubt it's cheaper to borrow at 7 to 9% than issuing a pipe or convertible debt or convertible bonds. You know, it's an opportunistic facility, one they can draw a short notice and repay at short notice. However, I think the companies that do well here are going to be those that differentiate Themselves, either they're really large, they have a fantastic brand name, like, like a strategy, or they get the lowest cost of capital or they're able to, you know, to somehow generate a yield on their treasury assets. Now, that's going to be more relevant for the ETH and the SOL ones than the BTC ones. But I do think you either have to get really big or you have to find a niche to. To survive in the. In the treasury code game. Yeah.
[12:36]
A
That's why my sort of theory that I've been developing is that if you're going to have. Have a Treasury company, even though I believe bitcoin's the only valid treasury asset long term, like, altcoins are just too. I don't know. I have nothing against altcoins. Everybody knows I love them. But like, Hyper Liquid is not a hedge against dollar inflation for the cash on your balance sheet. Right. So I do think, though, that it's impossible to beat Bitcoin with Bitcoin, so you have to do something. It's very easy to beat Solana with Solana because you just stake it and make 9%. So actually benchmarking an asset and you admit that it's a trade or kind of a. Loosely a hedge fund and not a Treasury asset or company. Yeah, those actually make a hell of a lot more sense to me. You literally don't need to take leverage on an Altcoin treasury company to justify a slight premium.
[13:28]
B
Yeah, yeah, no, 100%. You just need to be more efficient with your treasury assets. And in Solana's case, you can stake it in hyper liquids case. Hyperlink is probably kind of a little bit more interesting from that perspective because you can participate in these auctions and get paid fees for holding the treasury assets. So I think that's one thing that could emerge. And then I think also another tweet we kind of discussed earlier in the week was the idea that if, notwithstanding what we've just seen on ppi, if you do get a rate cut before the end of the year, crypto spreads tend to widen relative to tradfi. And you might. Actually, I've been interested in the idea of could you seek some kind of treasury company that's set up to do debt like crypto, you know, to effectively monetize the spread that you see in crypto over what you can earn in tradfi.
[14:25]
A
Yeah, there's so many creative ways to create these things. It's just, I think, as I'm saying, it's just harder with Bitcoin. Your point about hyper.
[14:33]
B
Yeah, yeah, no, I'm 100%.
[14:35]
A
As long as you don't. I just don't think you should then call those a Treasury company. I think you just say like a hyper liquid hedge fund.
[14:40]
B
Yeah, yeah.
[14:42]
A
So that people know because somebody is doing something to engineer a yield that justifies a premium to nav.
[14:49]
B
Yeah. I tend to agree with you. I think it's just a product of, you know, if you're structuring one of those companies or one of those deals, it's, you know, you speak in the language that the investors understand. And so if they've seen 10 pitches for Bitcoin treasury companies, if you go, what they're saying, it's a Treasury company, it's just easier for the audience.
[15:09]
A
Okay, so let's talk about, though I agree with you. Yeah. What you touched on, because it's more interesting, which is that obviously you have your finger on the pulse at Maple of institutional asset management on chain. Right. And how these people are going to use their assets. Let's admit that they're going to have to do something, Bitcoin or otherwise. And as you said, you're very interested in being a part of that something. So, so the conversations you're having with them, what does that look like without giving away anything, you know, any inside information.
[15:41]
B
Well, for us, you know, for us, the, the pitch is that they can, they can either go to capital markets and issue pipes or convertible bonds or preferred equity, but those are going to be expensive. Those investors aren't hanging out for a sub 10 return on investment. They're looking for 15 to 20 plus IRRs. So there we can be a cheaper source of capital for them. We can be a facility they can draw down with within a day's notice so they can opportunistically buy the dips and that's where they can start to compete with each other. So you're, if you're the 50th bitcoin company, you, you know, but you can buy the dips better than the others. Well, over time you're going to end up with more bitcoin per share for your, for your shareholders. Exactly. Yeah. Yeah, exactly. Your hedge fund, your bitcoin hedge fund will outperform. And, and then also you can, you know, then you can pay back our facility really quickly if you have, you know, one of these pipes or convertible deals, you know, in the works. So cheaper, more flexible, easier to draw down. And, and that's the pitch. And, but the issue we have to overcome is a lot of these treasury companies, they do not want to represent to the market that they have a liquidation price on their assets. Saylor had this back in 2022. He used to have a facility with, with one of the big regional banks that's no longer with us, which is funny.
[17:13]
A
Only 300 million of a multi.
[17:16]
B
Like a drop in the ocean compared.
[17:18]
A
To enough of a narrative to drive people crazy.
[17:20]
B
Yeah, yeah, yeah. A drop in the ocean compared to what he does on a, you know, an even, you know, even a weekly basis now. But, but I think it was sensible at the time and I think there's a place for this type of facility for the purpose of buying the dips. I don't know that it's. Yeah, I don't know this. That's long term, you know, long duration.
[17:44]
A
In theory, relatively quickly. They. They buy the dip.
[17:47]
B
As long as you structure it conservatively, they, you know, there could be very little chance of them hitting a margin call. Or if they hit it and you've sized it appropriately, then they can easily make the margin call. It's not in our interest for any of these guys to get liquidated. We do not want to be responsible for that. And it would, you know, it would, it would certainly prevent us from doing other deals in the space just as we're getting started. So. But I think, you know, it can be a very healthy, mutually beneficial partnership. And so we're in conversation with these teams. But what I would say is for the bitcoin companies, we have pitched a deal where they could stake their bitcoin and get a lower cost on the debt because we had a bitcoin yield product.
[18:29]
A
Do you wrap it and put it in defi. I mean, how does that work?
[18:34]
B
We actually, we stake the bitcoin in custodians and we use it in core network staking. So it's one of the Bitcoin L1s, so you're not really at a risk of slashing or a defi hack. But that's, that's just one flavor. The others are that we would let them stake. Whether it's. They could stake hype and then continue to earn fees from those auctions or they could stake soul. And we can also lower their cost of debt because we can keep some of the. Keep some of the sole yield. But all of it adds up to, we're open to creative structures where they can lower their cost of capital or start to earn more income on their treasury assets. That's kind of the core pitch.
[19:15]
A
Yeah, you touched on it earlier and you just Kind of made it even clearer. The concern continues to be to me, and I've said this a thousand times, it's company number 73 or 35 or whatever it is. Like what are the.
[19:28]
B
There's a natural decline in quality.
[19:30]
A
What do they have to do to compete quality but also just demand like you're just too late and where is the money going to come from and what kind of pitch or risk are they going to have to take on to then compete? Like why would you buy their stock instead of MicroStrategy? To be honest, like I think MicroStrategy is like 1.7 to M nav right now Multiple. That's really low. I mean.
[19:52]
B
Yeah, historically very low. Yeah.
[19:54]
A
Okay. And why would you buy one at seven?
[19:57]
B
Yeah, no, no, I, yeah I, I agree they have to kind of the business model of the newer ones relies on them having an M Navigation premium and the more there are already in the market, the harder it is to justify your M Nav premium. And that's where you've got it. Eventually one of these companies is going to go quite far out on the risk curve and, and I'm sure one of them will blow up eventually.
[20:25]
A
Yeah, I think it's almost guaranteed. So what else are you guys heavily focused on right now? I mean I'm assuming it's just this humongous instrument, institutional wall of money we just talked about. But you obviously, I mean stablecoin yield, you guys have quite a few products still.
[20:41]
B
Yeah, we we've been trying to grow the, the stable coin. Yeah. One of the things we did we actually just announced today was or, or yesterday was the. We got syrup USDC onboarded as collateral for Drift so for the uh, the Perps exchange. So I think this is interesting because it kind of marks a move towards yield bearing collateral on these exchanges. And there's you know it's no secret that you know we would, we would like to also be on hyper liquid and there are a couple of other players who have yield bearing collateral that also would like to, to you know to, to get onboarded to these, to these perps Dexes. So I think that's, I think that's going to be a big trend for the rest of the year to keep an eye on so.
[21:30]
A
Yeah, yeah, go ahead please.
[21:33]
B
I was gonna say for those who haven't seen the article, effectively traders, you know traders might have historically posted BTC or if they held stable coins they post stables to you know as collateral for perps position where they could get leverage. But now you can actually earn a yield on the collateral which is going to offset the cost of your, of your perp. So much more capital efficient for traders.
[21:56]
A
Yeah. This is so interesting because obviously this is the primary use case for USDT or usdc. Right. Is speculation and perpetual trading all the way from institution probably down to retail. Now you can effectively be earning yield on that stablecoin that you're using to trade while the trade is open and beyond. If this catches fire. If this catches fire. Why would you ever use a dollar when you can have a yield bearing dollar?
[22:27]
B
Yeah, exactly. I mean that's, that's, that's essentially the pitch from us is is this, is this is a no brainer. You may as well earn on the collateral that you're putting in for these, for these trading positions. And once we have yield bearing BTC which is, which is coming then you could do it on the BTC side as well.
[22:49]
A
And how do people get access to the yield bearing syrup usdc how will they get access to yield bearing Bitcoin.
[22:56]
B
Like what's so syrup syrup USDC is available outside the US at the moment but anyone with USDC can go and mint it or you can buy it on you know, on a Dex. Like we have pretty deep uni swap liquidity and, and so yeah, so so really it's, it's, it's the third largest yield bearing stable out there at the moment. So I think there's about 900 million of it in, in circulation. So it's, it's relatively abundant and I'd encourage people to go out and go and check it out and give it Athena.
[23:31]
A
I mean is this kind of the same bucket as.
[23:33]
B
Yeah, it's in the same market. So you know we, we, we really like the Athena team. We really like the, the the sky team. And those are, you know, those are the other two in the, in the top three for yield bearing stables.
[23:46]
A
I mean I'm looking right now, Is this correct? 6.9%.
[23:52]
B
Yeah. So that's underlying yield coming from over collateralized loans.
[23:57]
A
I mean earning 6.9% while you use it rather than just using a dollar with no yield. Seems as long as you understand, I mean there's gotta be some risk like nothing's free. Right. But as long as you understand what you're doing. Seems like especially for institutions moving size. Yeah. 100% obvious. So how big did you say this is? Almost a billion dollars.
[24:21]
B
Yeah. Yeah. So it's over 900 million. All of the yield is coming from over collateralized loans to institutional borrowers. And the reason that we're able to generate relatively high yields versus some of the defi yields is that institutions will pay a little bit more to be able to pledge bitcoin. They'll pay more to be able to get fixed duration of on their loans or to be able to keep the collateral in tri party custody. So that's, you know, that's typically why CFI rates are a little bit higher than, than defi borrowed. And also our yields have been, you know, relatively stable over time as well because we, you know, we always have a number of fixed loans on foot. So while defi rates might kind of zigzag around the maple, the syrup USD yields are typically pretty stable and slow to move. So that 6.9 has been relatively consistent over time.
[25:17]
A
Yeah. Just a general question as we come to the end that's been of debate throughout this entire run. Who's cashing out a bitcoin at record highs above 120k? We had the same conversation at 100 and 110 and 120 multiple times. It seems that the indication still remains, and you're block on chain guy, is that it's actually these early whales and you know, early holders who are cashing out.
[25:45]
B
I think you're seeing, I mean, yeah, we're seeing it. I think we're kind of seeing the same thing. Now I'm not necessarily a, a trading expert, but one of the observations I'd make is, you know, for a lot of these early whales it's now, you know, 16 years maybe, you know, maybe if they're holding since 2011 or 2012, you know, that you're looking at more than, more than a dozen years. It might be the case that they're, they're at the stage now, depending on how old they were when they first purchased it, where they're kind of looking at estate planning. So now they have kind of generational wealth. You know, maybe they've passed away, maybe they've been through a divorce or something. And so there's kind of, you know, there's estate planning or selling going on for. Not necessarily because it's, it's their, their price target, but it's because the amount of time that's elapsed has mean that their life circumstances have, you know, have kind of drastically changed from where they were when they first purchased it. So, so I don't find it too strange that, that some of these early wallets are selling out. But you know, I mean, my view is that it's going higher. So I, yeah, I would find unusual if they're doing it from a price target perspective. Looking to liquidate everything.
[26:58]
A
Yeah, I just think there's a point where you're either at a certain age or a certain level of wealth where it's so insane that you're just like, I mean maybe I should sell 20. The funny thing is we have this assumption. There's this guy who sold 80,000 bitcoin famously a few weeks ago, 2012 wallets or whatever and just sent 10,000 clip without even text test transactions. Probably from like a post it notepad wallet. I mean it's just crazy how fast it was but people, that Guy could have 500,000 Bitcoin.
[27:28]
B
Yeah.
[27:29]
A
There's no proof that he sold his entire stack. And if you were just sitting on $50 billion, you'd sell nine and go get a yacht and make sure it's taken care of. I don't think it's like a huge judgment, but it is.
[27:40]
B
Yeah. Because it's kind of like a generation wealth level that some of these, you know, some of these whales are going to hit where it's like if they've, you know, if they've got 2 or 3 billion or 10 billion, what's an extra billion or two? Like you know, they can kind of lock it in and they're, you know, they're five generations from now, their families still be living comfortably.
[28:00]
A
Yeah, well no, they'll blow it on coke and hookers but you know, you don't make it two generations when the wealth gets handed down. That's a fact. It's like lottery winners who, you know, they're 50% of them are bankrupt in two years or something else.
[28:12]
B
They'll, they'll go and put it in the, in the 200th dat.
[28:15]
A
That's right, to dat 200 yolo. Send all your bitcoin into it, hope for the best, end up at a 50% discount on your shares. Beautiful. You listen, you said your opinion is that it's going higher. So I mean before I let you go, maybe just like your general market thoughts and premise for you know, the next 2/4 year, 2 years, cycles, etc.
[28:37]
B
Yeah, I think, well, I think, I think this cycle. So let's say you know, whether that's two, two quarters or you know, anywhere from like two to three quarters. But let's say my kind of prediction or range for the cycle has been like 150 to 180. I think with the institutionalization of bitcoin there's a couple of trade Offs. So you're going to see more consistent inflows through the ETFs. You're seeing now more steady rates of new adoption coming through. Folks like Ray Dalio are saying bitcoin and gold should be 15% of folks portfolios. So I think that leads to kind of steady upwards pressure. But I think at the same time the size it's reached now, the level of adoption it's reached means that you don't see, you're not going to see eight to ten X's within a cycle. And so I think that's why I'm kind of sizing it and saying well there's probably a 2 to 3x in this cycle and from the last low I think that takes you to 180. Sorry, 150 to 180.
[29:46]
A
Yeah, that's kind of my prediction is not bad. Yeah, at, in a year, two years, five years, six months.
[29:53]
B
Oh no, no, I, I think, I think, I think six, you know, six to nine months.
[29:57]
A
Yeah. And then do you think we get a 75 brutal bear market for no half years? No.
[30:05]
B
I think the cycles get shallower now. That's the, that's the flip side of institutionalization.
[30:11]
A
Yeah, I totally agree. Well Sid man, thank you as always. Can your average person go use Maple or is it just for the company number 73?
[30:22]
B
No, no, no. We're open to individuals, institutions and treasury companies alike. So if you can go and find us, we are at Maple Finance on X. I am Europe Sid on X. Or you can head to our website Maple Finance. So we have a product for accredited investors in the US that will pay you between six and a half and 10% yield on stables. And then of course we have the syrup USD product for those outside of the US or those who are very defi native and that's currently paying as you showed before Scott, 6.9 and can be used as perps collateral now.
[31:01]
A
Incredible man. Well listen, I can't wait to see how all these treasury companies continue on and I guarantee that they're all coming to you and anyone like you to find, find ways to put this stuff to work. So be careful for them Sid.
[31:18]
B
Yeah, like I said it's not, it's not in our interest to be responsible for liquidating one of these. So we, we, we want them to succeed.
[31:27]
A
You'll hopefully we'll have you as a wall to risk, manage their potential bad decisions when they're trying to take up more risk. That's what we need. I am confident that we've learned a lot from last cycle. I know there will be people who blow up.
[31:40]
B
No YOLO 10x 10x margins, you know, 10x margining their. Their bitcoin treasury assets as collateral.
[31:46]
A
You got it, man. All right. Thank you so much, Sid. I'm about to go stake all my FTT and try to get a loan and see what we can.
[31:54]
B
Love it. Thanks for having me, Scott.
[31:56]
A
Pleasure having you guys. Give Sid a follow and we'll see you guys tomorrow. Thanks. Bye. That's dope. Let's do.

Summary6 min read

Podcast Summary: The Wolf Of All Streets – Episode: Bitcoin Tumbles After Smashing All-Time Highs! What's Next?

Release Date: August 14, 2025
Host: Scott Melker
Guest: Sid from Maple Finance

1. Introduction: Bitcoin's Recent Surge and Market Correction

The episode kicks off with Scott Melker discussing Bitcoin's remarkable achievement of reaching an all-time high of approximately $124,000 to $125,000. However, this celebratory mood was short-lived as Bitcoin experienced a swift decline, now trading around $118,441. Scott expresses skepticism about the sustained momentum, highlighting economic indicators and technical signals that suggest a peak might have been reached.

Notable Quote:

"Bitcoin just smashed through its all time high yesterday hitting almost around 124,000 to $125,000. Will this momentum continue? No, no it won't actually. Clearly the momentum is not continuing because Bitcoin is currently trading at 118,441." — Scott Melker [00:00]

2. Economic Indicators Affecting Bitcoin's Trajectory

Scott delves into the economic factors contributing to Bitcoin's correction. He references the Producer Price Index (PPI) data, indicating a significant rise in service-related margins, which exceeded expectations. Additionally, recent Consumer Price Index (CPI) numbers had previously incorporated a 100% rate cut into predictive markets. However, expectations for Federal Reserve rate cuts in September have been dismissed, adding to the uncertainty in the market.

Notable Quotes:

"We had the CPI numbers 100% rate cut priced in on predictive markets and Fed tracker. Now it's a week later and everyone's like no, no Fed cuts in September." — Scott Melker [02:06]

"Every day we get a new, some sort of government data headline. Nobody believes government data apparently anyways." — Scott Melker [02:42]

3. The Crypto IPO Boom: Surge in Crypto Exchange Listings

Transitioning to the main narrative for Bitcoin's upward push, Scott and Sid explore the boom in crypto Initial Public Offerings (IPOs). They discuss the surge in companies launching on crypto exchanges, citing examples like Circle and Bullish, which have seen their stock prices skyrocket post-IPO. The conversation underscores the strong demand from both institutional and retail investors.

Notable Quotes:

"IPOs in general are up, I think they're up 53% for the year so far versus same time last year."</ — Sid from Maple Finance [04:04]

"Crypto exchange, Bullish, price IPO at $37 per share. It went up to like $118 bucks." — Scott Melker [03:45]

4. Bitcoin Treasury Companies: Risks and Rewards

One of the episode's focal points is the discussion on Bitcoin treasury companies. Scott and Sid debate the viability and risks associated with these entities, which hold Bitcoin as part of their treasury assets. While initially skeptical about leveraging Bitcoin, Scott acknowledges the systemic risks primarily affecting the companies themselves rather than Bitcoin.

Notable Quotes:

"I was a huge skeptic at the beginning. I do not like leverage on bitcoin." — Scott Melker [07:20]

"Short term we get more of these. Currently they trade at premiums. I think over time that is going to trend towards a discount." — Sid from Maple Finance [08:41]

5. Market Dynamics and the Future of Bitcoin Treasury Companies

Sid elaborates on the forecast for Bitcoin treasury companies, predicting an initial surge in their numbers with a subsequent trend towards trading at a discount. He draws parallels with historical examples like Yahoo's holdings, emphasizing that market perceptions can lead to significant discounts even when underlying assets remain solid.

Notable Quotes:

"There's a natural decline in quality." — Scott Melker [19:28]

"Eventually one of these companies is going to go quite far out on the risk curve and, and I'm sure one of them will blow up eventually." — Sid from Maple Finance [19:57]

6. Institutional Interest and Maple Finance's Strategic Approach

Sid discusses Maple Finance's role in supporting Bitcoin treasury companies by offering lower-cost capital solutions compared to traditional avenues like PIPEs or convertible bonds. The emphasis is on providing flexible, short-term facilities that enable companies to opportunistically buy Bitcoin dips, thereby enhancing shareholder value.

Notable Quotes:

"They can be a cheaper source of capital for them. We can be a facility they can draw down within a day's notice so they can opportunistically buy the dips." — Sid from Maple Finance [15:09]

"We stake the bitcoin in custodians and we use it in core network staking." — Sid from Maple Finance [18:33]

7. Yield-Bearing Collateral and Stablecoin Innovations

The conversation shifts to innovations in yield-bearing collateral for traders. Maple Finance has introduced "Syrup USDC," allowing traders to earn a 6.9% yield on their stablecoins used as collateral for perpetual trading positions. This development aims to increase capital efficiency by offsetting the costs associated with leveraged trading.

Notable Quotes:

"Traders might have historically posted BTC or if they held stable coins they post stables to... now you can actually earn a yield on the collateral which is going to offset the cost of your perp." — Sid from Maple Finance [21:33]

"It's essentially a no brainer. You may as well earn on the collateral that you're putting in for these trading positions." — Scott Melker [22:27]

8. The Dynamics of Early Bitcoin Investors and Market Liquidity

Scott and Sid discuss the behavior of early Bitcoin holders ("whales") who might be cashing out their holdings despite record highs. Sid suggests that factors like estate planning, generational wealth transfer, or life changes could be influencing these sell-offs, rather than purely price targets.

Notable Quotes:

"Maybe they've passed away, maybe they've been through a divorce or something... estate planning or selling going on for." — Sid from Maple Finance [25:16]

"You don't make it two generations when the wealth gets handed down. That's a fact." — Scott Melker [28:12]

9. Future Outlook: Predictions and Market Cycles

Concluding the discussion, Sid shares his projections for Bitcoin's future, anticipating a price range between $150,000 to $180,000 within the next six to nine months. He attributes this outlook to the ongoing institutional adoption and steady inflows from ETFs, despite recognizing that the market cycles may become shallower due to increased institutionalization.

Notable Quotes:

"I think with the institutionalization of bitcoin... steady upwards pressure." — Sid from Maple Finance [28:36]

"I think six to nine months." — Sid from Maple Finance [29:53]

10. Accessibility and Final Remarks

Before wrapping up, Sid explains that Maple Finance's offerings are accessible not only to large companies but also to individual investors. He highlights the availability of high-yield products for accredited investors in the US and broader offerings like Syrup USDC for global or DeFi-native participants.

Notable Quotes:

"We're open to individuals, institutions and treasury companies alike." — Sid from Maple Finance [30:21]

"If you can go and find us, we are at Maple Finance on X." — Scott Melker [30:21]

Scott wraps up by expressing optimism about Maple Finance's role in the evolving Bitcoin treasury landscape, acknowledging potential risks but maintaining confidence in the market's upward trajectory.

Conclusion

In this insightful episode of The Wolf Of All Streets, Scott Melker and Sid from Maple Finance dissect the recent fluctuations in Bitcoin's price, the surge in crypto IPOs, and the emerging landscape of Bitcoin treasury companies. They explore the intricate balance between institutional adoption and market risks, offering listeners a comprehensive understanding of the current state and future prospects of Bitcoin and the broader crypto market.

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Transcript87 lines

[00:01]
A
Bitcoin just smashed through its all time high yesterday hitting almost around 124,000 to $125,000. Will this momentum continue? No, no it won't actually. Clearly the momentum is not continuing because Bitcoin is currently trading at 118,441American inflating dollars. What the hell just happened? We break all time highs, we're supposed to have blue skies and continue on up to 150, then 210, then 4 million. It didn't happen. Largely because of PPI and technical indicators showing maybe the top was in. We're going to talk about that. All the news in the market today with my amazing guest Sid from Maple Finance. Let's go, let's go. Good morning everybody. Happy all time high for 10 minutes day. To those who celebrate, we did have an all time high yesterday in bitcoin. Ethereum couldn't even get itself together enough to break its all time high. Coming up just short. And now of course we have a market wide correction and retrace going to bring on Sid right now. Good. More good evening. I say good morning for you, but you're on the other side of this planet, right?
[01:27]
B
Right. Good. Well, yeah. Good evening. Glad to be here.
[01:31]
A
Late night for you, I think. Okay. Okay. So Bitcoin goes up to $124,000. There's celebration, everything's great. I wake up, it's like 121 or something. Okay. No surprise, you know, if you trade markets, you know that there's resistance and all time highs, blah, blah, blah, whatever. And then PPI hits, right? PPI month over month, hottest since March 2022 as services PPI explode higher over half the increases attributable to margins for final demand trade services which jumped 2.0%. So basically they expected 0.2%. Yeah, 0.9%.
[02:05]
B
9.
[02:07]
A
Last week we had the CPI numbers 100% rate cut priced in on predictive markets and Fed tracker. Now it's a week later and everyone's like no, no Fed cuts in September. When have any, has anybody been right in the last two and a half years about Fed cuts?
[02:23]
B
No, no, this is, this is, you know, a point going to the, the nothing ever happens crowd. You know that guy who, who just bets on no change is ever happening on poly market right now. Yeah, yeah, yeah, yeah.
[02:42]
A
I mean, but listen, these are, we know that these all are blips, right? Every day we get a new, some sort of government data headline. Nobody believes government data apparently anyways, because I, I'm actually Wondering who gets fired today. I was just going to say literally who gets fired today? Because that can't be. Right. Right. But listen, in the midst of all this, I think let's talk about the actual narratives for bitcoin and crypto and the reason that it was even pushing to all time highs in the first place. We clearly have crypto IPO madness, I think is sort of the story. And treasury companies, right, we know exactly who the buyers are in this case, we know exactly where the interest and money are coming from. But here, the latest sign of crypto IPO boom might be coming. 10T Holdings. Dan Tapier predicts crypto listings on exchanges are a mini step for value moving on chain. Okay, whatever. Point being, the other article we have is that basically on the back of Trump being extremely bullish on crypto, we're seeing launches of companies left, right and center. And the biggest one, crypto exchange, bullish price IPO at 37 per share. It went up to like 118 bucks.
[03:46]
B
Yeah, I think that's where it topped down.
[03:49]
A
I mean this pulled so, so this pulled a full circle. Like, I don't mean full circle, I mean fully went circle. It actually launched, I think Circle was supposed to launch at like 29 and launched at 32 or 33 and went over 100 on the first day of trading. This did the same thing.
[04:05]
B
Yeah, yeah. No, I think, look, and what I, you know, what we're saying is that IPOs in general are up, I think they're up 53% for the year so far versus versus same time last year. But we, we are seeing real interest and you know, clear Demand for crypto IPOs. You know, we've seen the outperformance of Circle now bullish. We know that, you know, we know that there are other crypto IPOs coming. I think Kraken's, you know, it's no secret that Kraken is going to be coming to market. We've seen Gemini, I think Gemini had also done a confidential filing to, to IPO as well. So I think as long as the market keeps receiving them like this, and, and they, and they trade this well on the first day, you're going to continue to see more of these IPOs coming. And it clearly shows demand among institutional app, institutional investors as well as retail investors, because we know Circle was particularly well received in Korea as well.
[05:05]
A
Yeah. So here's the article showing the actual price action success of it. It opened, it ended up opening at 90. I mean it's really like just wild demand for this. And listen, let's be honest. Like, I know and like the people from Bullish. This is not an exchange that's on most people's radar. Right. It is Peter Thiel backed. They own CoinDesk. Like they've got a lot of things going, but nobody. This isn't a name brand retail exchange like a Coinbase or a Kraken or even Circle. And it still pulled the same crazy multiple. Like.
[05:39]
B
Yeah.
[05:39]
A
Does that just mean there's literally demand for anything that says crypto that can get on Exchange right now?
[05:46]
B
Well, I think it indicates there, you know, there are plenty of companies within crypto who should be looking to go live right now. I mean, as you said, Bullish doesn't do the most volume among exchanges in terms of the leaderboard, but, you know, it does have a few, you know, high profile assets. Like, I think it's generally a pretty well run exchange, has a really strong management team. They've got the CoinDesk brand under them and, you know, and then of course they have the Peter Thiel backing. And I think that counts for a lot with investors. But this signals that there's obviously rampant demand among investors. So Kraken should get their skates on. Gemini should get their skates on these. You know, these are also high profile names that you would expect to do as well. If not. If not. If not, better. Just given that they do. Given the volumes they do.
[06:34]
A
The volumes they do and their. And name brands and who's behind them. You know, like Gemini is a Winklevoss twins. Those guys are going to generate an insane amount of interest. Kraken, obviously one of the largest exchanges in the United States and been talking about them going public for years now. So clearly a very good environment. Hey, do you know how you can always tell. Go ahead.
[06:52]
B
Yeah, I was going to say it'd be interesting to see if, you know, if we kind of progress through this trend in this cycle the same way we have with the treasury Companies, what the 10th or 15th company to IPO will be in the crypto sector.
[07:08]
A
That's our next topic. Perfect segue. But I just want to ask you, do you know how you can always know when the top is in temporarily for any asset? Do you know what the indicator is?
[07:18]
B
Uber, Uber, Uber.
[07:20]
A
That's one. The one that I find to be the most compelling, they'll never do again is showing your portfolio or bragging to somebody, like pulling up your portfolio and showing them how well you've done, like showing your wife how much money will always be the dead top, always the top signal. Michael Saylor Today's strategies Bitcoin holdings close at an all time high of 70. I know he doesn't have a wife. Oh boy. But you know, no, I mean literally right at the top. He hit it with the brag.
[07:48]
B
And the other, the other one you've been seeing is Bukele from, from El Salvador. You know, every, every now and then we'll post, post his portfolio.
[07:57]
A
Yeah, he, his has been working out clearly on, on the way up better than this. But yeah. To be serious though, let's talk about the bitcoin treasury companies. It's my favorite topic. I love to get each person's take on how it will play out. I was a huge skeptic at the beginning. I do not like leverage on bitcoin. I don't see what the point is. I don't really understand the massive premiums to nav but I came around to think it's less of a systemic risk to bitcoin and more just a risk to the ones that fail. And there's shareholders. Right. I do think there will be some bitcoin selling but generally probably just blow up your company and end up at a discount. You have an interesting premise I think that I share on how this might play out.
[08:41]
B
Yeah, yeah. So my short term view is that there's going to be more of these because the market's saying that it, it's still willing to, you know, willing to, to absorb them. Absorb them and, and entertain the concept. So I think short term we get more of these. Currently they trade at premiums. I think over time that is going to trend towards a discount and you will see the stronger ones that trade at a premium. Let's say strategy will acquire those that trade at discounts because if you look at it, let's say Sailors Strategies trades at a 2 to 1 multiple. He can effectively sell $2 of stock which, which represents $1 of Bitcoin to buy $1 of Bitcoin for 50 cents. So he's effectively getting a forex benefit instead of a 2x benefit. So I think that's the natural progression of where this goes over time. And those who say these will never trade at discounts. That's what people said about grayscale in the past.
[09:44]
A
Let's talk about that because I hear that narrative constantly. How can you trade at a discount if you hold the bitcoin? How can your stock be worth less than the net asset value? Stocks have this funny way of being irrational in trading on their own. Regardless of the underlying fundamentals, just like crypto do. And it could easily happen. Now. Grayscale was a little different, only because, like, people literally couldn't redeem, so it was at a discount and people couldn't get their money out. So it sent a much bigger discount. But that was down to 50, 60%. There's nothing to say these can't go down 5, 10%, which would be, as you said, a huge discount for anybody who has dry powder. Jack Mehlers. Actually, I asked him, like, at Bitcoin Vegas, right when this trend was hitting hard and he had just launched 21. I was like, isn't this like a systemic risk? Isn't this bad? He was like, I hope they all blow up so I can buy them. He literally said it.
[10:34]
B
Yeah. Which, you know, which. Which is totally, like, totally logical and sensible for. For anyone who continues to have a premium to. To do and anyone who remains, you know, well capitalized. But for those who think that you can't trade a discount when you still got the bitcoin, I'd point out that, you know, it wasn't so long ago Yahoo traded at a discount to the value of their Alibaba holdings. Right. Which suggested that the market viewed that Yahoo was actually going to destroy Alibaba value, even though they held liquid Alibaba shares on their balance sheet that were worth more than the entire value of Yahoo at that time.
[11:10]
A
Yeah, it's crazy, but we have plenty of examples that will happen. I wonder if it would actually be Microstrategy that buys them up or if it'll be like Nakamoto in 21, or if they'll all kind of the early ones with the big money pump, you know, a billion bucks. I think if there's waiting. My knowledge, a lot of them haven't even bought much Bitcoin yet. Yeah, they're waiting for regulatory clarity or approval to pivot the companies that they took over.
[11:33]
B
So, I mean, we've been speaking to a few of them. We, you know, I think we make no secret that, you know, we would be interested in lending to a number of these companies in, you know, in. In. In that we can provide them with capital that's a lower cost of capital. So no doubt it's cheaper to borrow at 7 to 9% than issuing a pipe or convertible debt or convertible bonds. You know, it's an opportunistic facility, one they can draw a short notice and repay at short notice. However, I think the companies that do well here are going to be those that differentiate Themselves, either they're really large, they have a fantastic brand name, like, like a strategy, or they get the lowest cost of capital or they're able to, you know, to somehow generate a yield on their treasury assets. Now, that's going to be more relevant for the ETH and the SOL ones than the BTC ones. But I do think you either have to get really big or you have to find a niche to. To survive in the. In the treasury code game. Yeah.
[12:36]
A
That's why my sort of theory that I've been developing is that if you're going to have. Have a Treasury company, even though I believe bitcoin's the only valid treasury asset long term, like, altcoins are just too. I don't know. I have nothing against altcoins. Everybody knows I love them. But like, Hyper Liquid is not a hedge against dollar inflation for the cash on your balance sheet. Right. So I do think, though, that it's impossible to beat Bitcoin with Bitcoin, so you have to do something. It's very easy to beat Solana with Solana because you just stake it and make 9%. So actually benchmarking an asset and you admit that it's a trade or kind of a. Loosely a hedge fund and not a Treasury asset or company. Yeah, those actually make a hell of a lot more sense to me. You literally don't need to take leverage on an Altcoin treasury company to justify a slight premium.
[13:28]
B
Yeah, yeah, no, 100%. You just need to be more efficient with your treasury assets. And in Solana's case, you can stake it in hyper liquids case. Hyperlink is probably kind of a little bit more interesting from that perspective because you can participate in these auctions and get paid fees for holding the treasury assets. So I think that's one thing that could emerge. And then I think also another tweet we kind of discussed earlier in the week was the idea that if, notwithstanding what we've just seen on ppi, if you do get a rate cut before the end of the year, crypto spreads tend to widen relative to tradfi. And you might. Actually, I've been interested in the idea of could you seek some kind of treasury company that's set up to do debt like crypto, you know, to effectively monetize the spread that you see in crypto over what you can earn in tradfi.
[14:25]
A
Yeah, there's so many creative ways to create these things. It's just, I think, as I'm saying, it's just harder with Bitcoin. Your point about hyper.
[14:33]
B
Yeah, yeah, no, I'm 100%.
[14:35]
A
As long as you don't. I just don't think you should then call those a Treasury company. I think you just say like a hyper liquid hedge fund.
[14:40]
B
Yeah, yeah.
[14:42]
A
So that people know because somebody is doing something to engineer a yield that justifies a premium to nav.
[14:49]
B
Yeah. I tend to agree with you. I think it's just a product of, you know, if you're structuring one of those companies or one of those deals, it's, you know, you speak in the language that the investors understand. And so if they've seen 10 pitches for Bitcoin treasury companies, if you go, what they're saying, it's a Treasury company, it's just easier for the audience.
[15:09]
A
Okay, so let's talk about, though I agree with you. Yeah. What you touched on, because it's more interesting, which is that obviously you have your finger on the pulse at Maple of institutional asset management on chain. Right. And how these people are going to use their assets. Let's admit that they're going to have to do something, Bitcoin or otherwise. And as you said, you're very interested in being a part of that something. So, so the conversations you're having with them, what does that look like without giving away anything, you know, any inside information.
[15:41]
B
Well, for us, you know, for us, the, the pitch is that they can, they can either go to capital markets and issue pipes or convertible bonds or preferred equity, but those are going to be expensive. Those investors aren't hanging out for a sub 10 return on investment. They're looking for 15 to 20 plus IRRs. So there we can be a cheaper source of capital for them. We can be a facility they can draw down with within a day's notice so they can opportunistically buy the dips and that's where they can start to compete with each other. So you're, if you're the 50th bitcoin company, you, you know, but you can buy the dips better than the others. Well, over time you're going to end up with more bitcoin per share for your, for your shareholders. Exactly. Yeah. Yeah, exactly. Your hedge fund, your bitcoin hedge fund will outperform. And, and then also you can, you know, then you can pay back our facility really quickly if you have, you know, one of these pipes or convertible deals, you know, in the works. So cheaper, more flexible, easier to draw down. And, and that's the pitch. And, but the issue we have to overcome is a lot of these treasury companies, they do not want to represent to the market that they have a liquidation price on their assets. Saylor had this back in 2022. He used to have a facility with, with one of the big regional banks that's no longer with us, which is funny.
[17:13]
A
Only 300 million of a multi.
[17:16]
B
Like a drop in the ocean compared.
[17:18]
A
To enough of a narrative to drive people crazy.
[17:20]
B
Yeah, yeah, yeah. A drop in the ocean compared to what he does on a, you know, an even, you know, even a weekly basis now. But, but I think it was sensible at the time and I think there's a place for this type of facility for the purpose of buying the dips. I don't know that it's. Yeah, I don't know this. That's long term, you know, long duration.
[17:44]
A
In theory, relatively quickly. They. They buy the dip.
[17:47]
B
As long as you structure it conservatively, they, you know, there could be very little chance of them hitting a margin call. Or if they hit it and you've sized it appropriately, then they can easily make the margin call. It's not in our interest for any of these guys to get liquidated. We do not want to be responsible for that. And it would, you know, it would, it would certainly prevent us from doing other deals in the space just as we're getting started. So. But I think, you know, it can be a very healthy, mutually beneficial partnership. And so we're in conversation with these teams. But what I would say is for the bitcoin companies, we have pitched a deal where they could stake their bitcoin and get a lower cost on the debt because we had a bitcoin yield product.
[18:29]
A
Do you wrap it and put it in defi. I mean, how does that work?
[18:34]
B
We actually, we stake the bitcoin in custodians and we use it in core network staking. So it's one of the Bitcoin L1s, so you're not really at a risk of slashing or a defi hack. But that's, that's just one flavor. The others are that we would let them stake. Whether it's. They could stake hype and then continue to earn fees from those auctions or they could stake soul. And we can also lower their cost of debt because we can keep some of the. Keep some of the sole yield. But all of it adds up to, we're open to creative structures where they can lower their cost of capital or start to earn more income on their treasury assets. That's kind of the core pitch.
[19:15]
A
Yeah, you touched on it earlier and you just Kind of made it even clearer. The concern continues to be to me, and I've said this a thousand times, it's company number 73 or 35 or whatever it is. Like what are the.
[19:28]
B
There's a natural decline in quality.
[19:30]
A
What do they have to do to compete quality but also just demand like you're just too late and where is the money going to come from and what kind of pitch or risk are they going to have to take on to then compete? Like why would you buy their stock instead of MicroStrategy? To be honest, like I think MicroStrategy is like 1.7 to M nav right now Multiple. That's really low. I mean.
[19:52]
B
Yeah, historically very low. Yeah.
[19:54]
A
Okay. And why would you buy one at seven?
[19:57]
B
Yeah, no, no, I, yeah I, I agree they have to kind of the business model of the newer ones relies on them having an M Navigation premium and the more there are already in the market, the harder it is to justify your M Nav premium. And that's where you've got it. Eventually one of these companies is going to go quite far out on the risk curve and, and I'm sure one of them will blow up eventually.
[20:25]
A
Yeah, I think it's almost guaranteed. So what else are you guys heavily focused on right now? I mean I'm assuming it's just this humongous instrument, institutional wall of money we just talked about. But you obviously, I mean stablecoin yield, you guys have quite a few products still.
[20:41]
B
Yeah, we we've been trying to grow the, the stable coin. Yeah. One of the things we did we actually just announced today was or, or yesterday was the. We got syrup USDC onboarded as collateral for Drift so for the uh, the Perps exchange. So I think this is interesting because it kind of marks a move towards yield bearing collateral on these exchanges. And there's you know it's no secret that you know we would, we would like to also be on hyper liquid and there are a couple of other players who have yield bearing collateral that also would like to, to you know to, to get onboarded to these, to these perps Dexes. So I think that's, I think that's going to be a big trend for the rest of the year to keep an eye on so.
[21:30]
A
Yeah, yeah, go ahead please.
[21:33]
B
I was gonna say for those who haven't seen the article, effectively traders, you know traders might have historically posted BTC or if they held stable coins they post stables to you know as collateral for perps position where they could get leverage. But now you can actually earn a yield on the collateral which is going to offset the cost of your, of your perp. So much more capital efficient for traders.
[21:56]
A
Yeah. This is so interesting because obviously this is the primary use case for USDT or usdc. Right. Is speculation and perpetual trading all the way from institution probably down to retail. Now you can effectively be earning yield on that stablecoin that you're using to trade while the trade is open and beyond. If this catches fire. If this catches fire. Why would you ever use a dollar when you can have a yield bearing dollar?
[22:27]
B
Yeah, exactly. I mean that's, that's, that's essentially the pitch from us is is this, is this is a no brainer. You may as well earn on the collateral that you're putting in for these, for these trading positions. And once we have yield bearing BTC which is, which is coming then you could do it on the BTC side as well.
[22:49]
A
And how do people get access to the yield bearing syrup usdc how will they get access to yield bearing Bitcoin.
[22:56]
B
Like what's so syrup syrup USDC is available outside the US at the moment but anyone with USDC can go and mint it or you can buy it on you know, on a Dex. Like we have pretty deep uni swap liquidity and, and so yeah, so so really it's, it's, it's the third largest yield bearing stable out there at the moment. So I think there's about 900 million of it in, in circulation. So it's, it's relatively abundant and I'd encourage people to go out and go and check it out and give it Athena.
[23:31]
A
I mean is this kind of the same bucket as.
[23:33]
B
Yeah, it's in the same market. So you know we, we, we really like the Athena team. We really like the, the the sky team. And those are, you know, those are the other two in the, in the top three for yield bearing stables.
[23:46]
A
I mean I'm looking right now, Is this correct? 6.9%.
[23:52]
B
Yeah. So that's underlying yield coming from over collateralized loans.
[23:57]
A
I mean earning 6.9% while you use it rather than just using a dollar with no yield. Seems as long as you understand, I mean there's gotta be some risk like nothing's free. Right. But as long as you understand what you're doing. Seems like especially for institutions moving size. Yeah. 100% obvious. So how big did you say this is? Almost a billion dollars.
[24:21]
B
Yeah. Yeah. So it's over 900 million. All of the yield is coming from over collateralized loans to institutional borrowers. And the reason that we're able to generate relatively high yields versus some of the defi yields is that institutions will pay a little bit more to be able to pledge bitcoin. They'll pay more to be able to get fixed duration of on their loans or to be able to keep the collateral in tri party custody. So that's, you know, that's typically why CFI rates are a little bit higher than, than defi borrowed. And also our yields have been, you know, relatively stable over time as well because we, you know, we always have a number of fixed loans on foot. So while defi rates might kind of zigzag around the maple, the syrup USD yields are typically pretty stable and slow to move. So that 6.9 has been relatively consistent over time.
[25:17]
A
Yeah. Just a general question as we come to the end that's been of debate throughout this entire run. Who's cashing out a bitcoin at record highs above 120k? We had the same conversation at 100 and 110 and 120 multiple times. It seems that the indication still remains, and you're block on chain guy, is that it's actually these early whales and you know, early holders who are cashing out.
[25:45]
B
I think you're seeing, I mean, yeah, we're seeing it. I think we're kind of seeing the same thing. Now I'm not necessarily a, a trading expert, but one of the observations I'd make is, you know, for a lot of these early whales it's now, you know, 16 years maybe, you know, maybe if they're holding since 2011 or 2012, you know, that you're looking at more than, more than a dozen years. It might be the case that they're, they're at the stage now, depending on how old they were when they first purchased it, where they're kind of looking at estate planning. So now they have kind of generational wealth. You know, maybe they've passed away, maybe they've been through a divorce or something. And so there's kind of, you know, there's estate planning or selling going on for. Not necessarily because it's, it's their, their price target, but it's because the amount of time that's elapsed has mean that their life circumstances have, you know, have kind of drastically changed from where they were when they first purchased it. So, so I don't find it too strange that, that some of these early wallets are selling out. But you know, I mean, my view is that it's going higher. So I, yeah, I would find unusual if they're doing it from a price target perspective. Looking to liquidate everything.
[26:58]
A
Yeah, I just think there's a point where you're either at a certain age or a certain level of wealth where it's so insane that you're just like, I mean maybe I should sell 20. The funny thing is we have this assumption. There's this guy who sold 80,000 bitcoin famously a few weeks ago, 2012 wallets or whatever and just sent 10,000 clip without even text test transactions. Probably from like a post it notepad wallet. I mean it's just crazy how fast it was but people, that Guy could have 500,000 Bitcoin.
[27:28]
B
Yeah.
[27:29]
A
There's no proof that he sold his entire stack. And if you were just sitting on $50 billion, you'd sell nine and go get a yacht and make sure it's taken care of. I don't think it's like a huge judgment, but it is.
[27:40]
B
Yeah. Because it's kind of like a generation wealth level that some of these, you know, some of these whales are going to hit where it's like if they've, you know, if they've got 2 or 3 billion or 10 billion, what's an extra billion or two? Like you know, they can kind of lock it in and they're, you know, they're five generations from now, their families still be living comfortably.
[28:00]
A
Yeah, well no, they'll blow it on coke and hookers but you know, you don't make it two generations when the wealth gets handed down. That's a fact. It's like lottery winners who, you know, they're 50% of them are bankrupt in two years or something else.
[28:12]
B
They'll, they'll go and put it in the, in the 200th dat.
[28:15]
A
That's right, to dat 200 yolo. Send all your bitcoin into it, hope for the best, end up at a 50% discount on your shares. Beautiful. You listen, you said your opinion is that it's going higher. So I mean before I let you go, maybe just like your general market thoughts and premise for you know, the next 2/4 year, 2 years, cycles, etc.
[28:37]
B
Yeah, I think, well, I think, I think this cycle. So let's say you know, whether that's two, two quarters or you know, anywhere from like two to three quarters. But let's say my kind of prediction or range for the cycle has been like 150 to 180. I think with the institutionalization of bitcoin there's a couple of trade Offs. So you're going to see more consistent inflows through the ETFs. You're seeing now more steady rates of new adoption coming through. Folks like Ray Dalio are saying bitcoin and gold should be 15% of folks portfolios. So I think that leads to kind of steady upwards pressure. But I think at the same time the size it's reached now, the level of adoption it's reached means that you don't see, you're not going to see eight to ten X's within a cycle. And so I think that's why I'm kind of sizing it and saying well there's probably a 2 to 3x in this cycle and from the last low I think that takes you to 180. Sorry, 150 to 180.
[29:46]
A
Yeah, that's kind of my prediction is not bad. Yeah, at, in a year, two years, five years, six months.
[29:53]
B
Oh no, no, I, I think, I think, I think six, you know, six to nine months.
[29:57]
A
Yeah. And then do you think we get a 75 brutal bear market for no half years? No.
[30:05]
B
I think the cycles get shallower now. That's the, that's the flip side of institutionalization.
[30:11]
A
Yeah, I totally agree. Well Sid man, thank you as always. Can your average person go use Maple or is it just for the company number 73?
[30:22]
B
No, no, no. We're open to individuals, institutions and treasury companies alike. So if you can go and find us, we are at Maple Finance on X. I am Europe Sid on X. Or you can head to our website Maple Finance. So we have a product for accredited investors in the US that will pay you between six and a half and 10% yield on stables. And then of course we have the syrup USD product for those outside of the US or those who are very defi native and that's currently paying as you showed before Scott, 6.9 and can be used as perps collateral now.
[31:01]
A
Incredible man. Well listen, I can't wait to see how all these treasury companies continue on and I guarantee that they're all coming to you and anyone like you to find, find ways to put this stuff to work. So be careful for them Sid.
[31:18]
B
Yeah, like I said it's not, it's not in our interest to be responsible for liquidating one of these. So we, we, we want them to succeed.
[31:27]
A
You'll hopefully we'll have you as a wall to risk, manage their potential bad decisions when they're trying to take up more risk. That's what we need. I am confident that we've learned a lot from last cycle. I know there will be people who blow up.
[31:40]
B
No YOLO 10x 10x margins, you know, 10x margining their. Their bitcoin treasury assets as collateral.
[31:46]
A
You got it, man. All right. Thank you so much, Sid. I'm about to go stake all my FTT and try to get a loan and see what we can.
[31:54]
B
Love it. Thanks for having me, Scott.
[31:56]
A
Pleasure having you guys. Give Sid a follow and we'll see you guys tomorrow. Thanks. Bye. That's dope. Let's do.