Unchained Podcast: Bits + Bips — Grid Congestion Is Energy’s L1 Problem. This Crypto Company Has a Solution

Date: March 28, 2026
Host: Steve Ehrlich (Head of Research, Sharplink)
Guest: Sean Murray (Head of Special Projects & Crypto Lead, Fuse Energy)

Overview

In this episode, Steve Ehrlich speaks with Sean Murray from Fuse Energy, a UK-based full-stack energy company, about the intersection of crypto, decentralized physical infrastructure (DePin), and energy market volatility. They explore how grid congestion mirrors blockchain network congestion, the mechanics of energy market price discovery, and Fuse’s novel token-based demand response system. The episode dives into the company’s roots, regulatory journey, and the tokenomics of their forthcoming blockchain-based energy platform aimed at reducing grid congestion and making a real-world impact.

Key Discussion Points & Insights

1. Fuse Energy's Background and Business Model

• Origins: Founded by ex-Revolut employees, Fuse Energy is a vertically integrated energy company operating across generation (solar, wind), energy trading, wholesale markets, supply to homes/businesses, and R&D for distributed energy devices.
  • Sean Murray (03:02): “…we’re a verticalized energy company. So it means we operate across the energy stack…generating energy from our own generation plants…to a big in house kind of trading operation…to then ultimately supplying homes and soon businesses with energy and billing them every month for it.”
• Growth: Currently about $0.5B in annual revenue, mainly in Europe and the UK, planning US and further international expansion.

2. Energy Market Volatility & Macro Factors

• Europe vs. US Energy Exposure:
  • US is more insulated due to shale; Europe remains heavily dependent on imports—with storage seasonality influencing prices.
  • Sean Murray (07:38): “...with the recent shale revolution, [the US is] fairly insulated…But that decoupling…will look to converge over time.”
• Current Gas Prices: Elevated due to global unrest and infrastructure attacks (e.g., closure of the Strait of Hormuz, attack on Qatari LNG facilities).
  • Sean Murray (10:06): “...the price of gas are basically about 50% to 70% above the kind of usual price that was kind of, we would expect around this, this kind of year.”

3. Grid Congestion as Energy’s ‘L1 Problem’

• Explaining the Analogy:
  • Grid constraints are likened to blockchain L1 congestion—fixed capacity, rising demand, and costly delays mirror network gas fees and throughput bottlenecks.
  • Sean Murray (27:25): “So the analogy I actually like to use is that grid networks are suffering from congestion issues very similar to how legacy L1s suffered from congestion issues. You’ve got limited network capacity, peak demand, and as a consequence, network congestion, high gas prices...it’s a scalability problem.”
• Real-World Impact: Billions in renewable energy is “shedded” (lost), as grids cannot transmit surplus from supply to demand zones due to capacity bottlenecks.

4. How Fuse Energy is Hedging and Trading

• Market Structure Overview:
  • Even in high-renewable regions, gas prices set the market price because gas fills the demand gaps.
  • Sean Murray (15:19): “Even if renewables make up 90% of your kind of generation mix, often it is the price of gas that then sets the market wide price.”
• Hedging Practices: Fuse builds positions via power exchanges, then refines near delivery based on updated weather/demand data (highly variable due to temperature dependence).
• Prediction Markets: Observing derivative markets (e.g., Hyper Liquid) with interest but note institutional energy contracts require more complexity and liquidity than current on-chain prediction markets provide.

5. Fuse’s DePin Solution & Token-Based Demand Response

The Problem:

• Demand Inflexibility: Most home and business energy demand is inelastic, leading to price spikes and inefficiencies.
• Grid Congestion: Inability to move energy where/when it’s needed creates waste and stunts further development.

The Solution:

• Demand Response via Tokenized Incentives:

  • Fuse’s DePin network coordinates millions of consumer devices (EV chargers, smart thermostats, batteries) to intelligently shift demand away from peak congestion.
  • Sean Murray (28:58): “If we can leverage all of these millions of devices...to actually respond to the grid conditions in real time, we can significantly reduce congestion on the grid...means lower costs of energy for everyone so we can do things faster.”

• Real Utility, Not Just “Crypto for the Sake of It”:

  • Fuse differentiates itself from prior DePin projects by anchoring its solution in an existing, regulated business with significant demand and adoption.
  • Direct value provided for users—discounts on goods/services (e.g., solar array installations) in exchange for their grid-flexible energy behavior.

6. Tokenomics, Regulatory Journey, and Utility

• Token Mechanism:
  • Users earn “Energy Dollar” tokens for providing device flexibility.
  • Tokens are burned for discounted products/services (e.g., solar installs), reducing long-term supply.
  • Sean Murray (36:04): “…I can actually take the tokens that I’ve earned, burn them…[for] a $2-3,000 discount on my solar array.”
• Emission and Burns:
  • Emissions align with energy transition schedules out to 2050; goal is for 50%+ of supply to be burned via real-world redemptions.
• No-Action Letter from SEC:
  • Regulated as a compliant utility token; core focus was ensuring “consumptive utility” versus speculation.
  • Sean Murray (38:11): “What they cared about was is there really a consumptive utility…the main focus for them.”
• No Airdrops:
  • Not giving away tokens en masse to speculators, but rather distributing in line with network value contributed.
  • Sean Murray (41:35): “...giving away a ton of supply to get like early kind of eyeballs just wasn’t quite our kind of, you know, skin.”

7. User Experience and Contingency Thinking

• Seamlessness:
  • Embedded wallets and UX designed for both web2/web3 users to easily redeem tokens for real value.
  • If redemption decreases or users just sell tokens, utility and in-app value will be emphasized to re-anchor usage.
• Device & Market Scale:
  • With just 0.1 MW (about 100 homes with smart thermostats) able to market-make in flexibility markets, scale is achievable; tens of thousands of homes could offset an entire data center.
  • Future plans include proprietary hardware and international expansion.

Notable Quotes & Memorable Moments

• On Grid vs. Blockchain Analogy:

  • Sean Murray (27:25): “Grid networks are suffering from congestion issues very similar to how legacy L1s suffered from congestion issues.”

• On Real-World Impact:

  • Sean Murray (27:13): “...over $70 billion in the last five years worth of renewable, clean, low cost power has essentially been shedded because we can’t move it across the grid to where it's needed.”

• On True Utility vs. Speculation:

  • Sean Murray (34:39): “...we release something that's actually useful and not just an investment vehicle or a speculation vehicle.”

• On Airdrops and Distribution:

  • Sean Murray (41:29): “...when I look at airdrops, I think they're going to be viewed, you know, historically as the most expensive marketing campaigns in history.”

Important Timestamps

| Timestamp | Segment Description | |-----------|--------------------| | 03:02-03:54 | Fuse’s business model & vertical integration explained | | 04:46-08:42 | Energy market volatility, differences between Europe & US, and the impact of recent global events | | 14:06-19:29 | Power market price discovery, inelastic demand, and how Fuse hedges energy exposure | | 24:33-29:14 | The grid as an L1 infrastructure problem & introduction of the DePin network | | 33:33-37:00 | Tokenomics: energy dollar, emissions, burns, and value flows | | 38:11-39:06 | SEC no-action letter, regulatory emphasis on utility | | 41:29-42:05 | Why Fuse Energy is not doing airdrops and the risks of incentivized farming | | 44:40-45:12 | Closing thoughts and how to follow Fuse’s progress |

Concluding Summary

This episode provides a comprehensive, jargon-light, and highly relevant discussion for listeners interested in the convergence of energy, crypto, and decentralized infrastructure. Fuse Energy’s approach to solving the grid’s ‘L1 congestion’ problem with a tokenized, compliant, real-economy solution is positioned as both pragmatic and forward thinking—directly rewarding users for participating in grid flexibility and reinvesting value into the ecosystem rather than solely relying on speculative web3 paradigms or unsustainable airdrop marketing tactics.

Sean Murray delivers nuanced, informed explanations for both industry veterans and newcomers, while Steve Ehrlich steers the conversation toward real-world impacts, regulatory nuance, and the practicalities of launching DePin at scale.

For more details:

• Follow @FuseEnergy on X and stay tuned for regular updates, competitions, and news around their upcoming Token Generation Event (TGE).
• Visit fuseenergy.com (assumed URL) for more information.

“If we can leverage all these millions of devices that are already just sitting in homes, like unused right now…we can significantly reduce congestion on the grid, which has tons of knock on effects…”
— Sean Murray, 28:35