Memecoins Are Stress-Testing The Future Of Tokenized Stocks | Weekly Roundup
Jason YanowitzSantiago Roel Santos
Jason Yanowitz compares the current market to the disbelief that followed a prior cycle’s 10% candle, while Santiago Roel Santos calls it the beginning of a bull market. Yanowitz recalls an ETF-related Cointelegraph intern post after which Bitcoin’s 10% move seemed impossible and memecoins began running while investors explained why the move could not last. Santos says his earlier “$65,000 generational bottom” call now looks increasingly credible, while acknowledging he gets few such calls right.
Santos sees memecoin–stock-token pools as the forcing function that could accelerate tokenized equities and 24/7 markets. Memecoins have “stressed the infrastructure more than any other piece of technology in crypto”; pairing their demand with scarce stock tokens forces liquidity providers, authorized participants, market makers, and market infrastructure to solve real problems. “The sheer volume is like opening a massive fire hose to sort this thing out.”
The Boner/HIMS pool demonstrated how a tiny, temporarily fixed on-chain float can detach sharply from the underlying stock. With roughly 60,000 HIMS tokens outstanding and more than half locked in the meme pool, weekend BONER demand pushed tokenized HIMS to an implied three-to-four-times Friday’s closing price, reportedly around $132. This was not a short squeeze in HIMS itself but a squeeze in the small authorized-participant wrapper pool while new tokens could not be minted.
Buying a memecoin paired with a stock token does not give the buyer a claim on the corresponding shares. Yanowitz described Robinhood’s tokenized HIMS as a Jersey debt security, theoretically backed one-for-one by shares at a custodian but carrying no votes or ordinary shareholder rights. Matt Levine’s warning, relayed on the show, is that users may not care about the wrapper when things are going well, but custody, redemption, backing, and rights will matter when something breaks.
On-chain equities have become the leading institutional and regulatory question around crypto. Yanowitz says New York institutions and Washington contacts independently called them “the single most important thing we’re trying to figure out,” while one fund discovered Hyperliquid through its pre-IPO markets. The opportunity therefore comes with an urgent need for transparency across custody, backing, legal claims, and token-holder rights.
Yanowitz’s preferred cycle expression is Robinhood, potentially supplemented by the L2 infrastructure beneath it, rather than ETH itself. He recommends Robinhood and L2 exposure, owns both, and says ETH’s roughly $300 billion valuation does not fit its current fees. Santos says he is also very long Robinhood and Coinbase, and calls Solana “literally years ahead” of most chains under sustained load. Yanowitz disclosed BTC, SOL, HYPE, ZEC, and MORPHO holdings.
Stablecoin distribution is becoming both a competitive moat and a market-cycle signal. Yanowitz argues USDC is the only asset that materially moves the needle for several new DeFi builders, interpreting Stripe’s single Open Issuance standard after acquiring Bridge as evidence that “the many stablecoin view has failed.” Santos agrees issuance may proliferate without meaningful volume fragmentation and reads BNB Chain’s approach toward overtaking Tron in stablecoin holders as evidence of growing retail participation.
1. The market feels alive because disbelief has returned
Yanowitz’s cycle comparison begins with a Cointelegraph intern’s ETF-related post from the prior cycle: a 10% candle felt impossible after such a long bear market, and the timeline immediately generated reasons it could not be a bull market. Memecoins then moved, first through names such as PEPE and later Fartcoin. Santos’s read today is stronger: “This is what the very beginning of a bull market feels like.”
Santos had publicly called $65,000 a “generational bottom” and now thinks the call may have landed, although he readily concedes, “I don’t get many of these calls right.” Blockworks analysts are again making serious money in memes, but LPs have not yet started urging the company to launch a fund—Santos’s recurring marker for genuine late-cycle behavior.
Yanowitz’s sentiment gauge is behavioral: “You want to be buying when you want to puke, and you want to sell when you start taking screenshots of your portfolio.” He sees neither extreme yet, despite the proliferation of FOMO screenshots. His renewed engagement matters because Santos says Yanowitz had not been excited about crypto for roughly two years.
Yanowitz praises the combination of FOMO’s social features, Robinhood Chain, Crossmint, and rapid Apple Pay onboarding, while stressing that participation is also a way to understand the mechanism rather than proof of easy profits. The reported distribution remains brutal—roughly 90% of people may not make money, comparable to a brokerage disclosure Yanowitz recalls stating that 82% of users lose.
2. Memecoins are turning tokenized stocks into infrastructure tests
Santos’s central thesis is that tokenized stocks advanced slowly because they lacked a forcing function. Memecoins supply it: intense demand collides with stock tokens, liquidity pools, constrained inventories, and market hours, compelling authorized participants and market makers to build machinery that can eventually support “24/7/365” equities.
The pairings are deliberately legible jokes: BONER with HIMS, an unnamed memecoin tied to AMC, Artificial with Nvidia, and Memory Moo with Micron. Santos also highlights ZAI, a privacy-cat memecoin whose holders receive Zcash airdrops—a dividend-like variation that became especially popular as Zcash rallied. He calls the broader design space the most interesting new primitive he has seen “since DeFi summer.”
His historical analogy is Solana: memecoins stressed the infrastructure more than any other piece of crypto technology and exposed congestion and fee problems that quieter applications might not have revealed. Whether people love or hate them, Santos calls memes crypto’s first proven product-market fit; joining them to equities may pull future market infrastructure forward faster than orderly experimentation would.
3. BONER squeezed a tiny HIMS wrapper, not the public stock
BONER launched on August 20 beside a tokenized version of HIMS on Robinhood Chain. One HIMS token was intended to track one listed share, but Yanowitz emphasizes that it was not the share itself: as he understood it, it was a Jersey debt security theoretically backed one-for-one by shares at a custodian, without votes or normal shareholder rights.
In the BONER/HIMS automated market maker, buying BONER deposits HIMS into the pool and removes BONER, making BONER more expensive in HIMS terms. Crucially, those HIMS tokens cease sitting in the separate HIMS–stablecoin pool where price discovery occurs. Demand therefore locks up the scarce wrapper even though it does not directly change the underlying company’s total share supply.
Yanowitz estimates only about 60,000 tokenized HIMS existed, with more than half eventually sitting inside the BONER pool. The speakers said authorized participants could create new wrappers only during a set window: they were unsure whether it ran Monday–Saturday or Monday–Friday, but weekend minting was unavailable. Tokenized HIMS consequently reached an implied three-to-four-times Friday’s close, around $132, before inventory could be replenished.
Yanowitz initially called the event essentially a squeeze, then corrected himself that it was not a conventional short squeeze. Santos sharpened the distinction: it was a squeeze on the authorized participant’s small pool, only a fraction of HIMS’s total public float. Santos’s unresolved question is what happens if meme demand becomes 100 times larger, especially against a small-cap stock where replenishment purchases might actually move the underlying.
4. The wrapper determines what token holders truly own
Drawing on Matt Levine’s taxonomy, Santos lays out four possible structures: issuer-native tokenized stock; an SPV holding exactly one share per token; a swap obligating the issuer to deliver the share’s economic return; or a token that merely references the stock while owing its holder nothing. The first is “the dream” but largely does not exist today; current products occupy the messier middle.
Levine’s warning, read by Santos, is temporal: “Users do not care in the slightest when things are going well.” In 24 months, when the usual crypto failure arrives, custody location, redemption rights, dividends, governing law, and whether shares ever existed will matter. Santos frames the practical question as whether users trust Robinhood and its redemption mechanism.
Yanowitz recalls similar friction around pre-IPO products tied to Anthropic, Stripe, and OpenAI: founders publicly denied approving transfers and said they might not honor the underlying arrangements. AMC CEO Adam Aron went further, calling Robinhood-linked AMC tokens “contemptable, outrageous, disgusting, detestable, inexcusable, and vile.” Robinhood’s chief legal officer, Dan Gallagher, responded to a regulator with an equally categorical “We will not desist.”
5. Wall Street’s attention is creating the investable layer
Yanowitz says recent New York and Washington conversations produced the same message: institutions and regulators view on-chain equities as “the single most important thing we’re trying to figure out.” Blockworks is sprinting to release data comparable to its token-transparency framework, because products with different custodians, backing arrangements, and legal rights cannot be responsibly grouped together.
One fund told Yanowitz that Hyperliquid entered its radar through pre-IPO markets such as Cerebras and SpaceX. The investors initially thought Hyperliquid was a data website; only later did they realize it was a trading venue. The anecdote shows pre-IPO exposure bringing crypto infrastructure to investors who were otherwise outside the trenches.
Yanowitz’s preferred expression is Robinhood: “Any day I’m not selling is a day I’m buying,” because he continually rebuilds the portfolio from scratch. He sees Robinhood as a clean way to own tokenization and stablecoin growth, with Arbitrum as the infrastructure complement earning fees from Robinhood Chain activity. He still rejects ETH’s valuation-to-fee proposition and mentions a possible EIP-1559 discussion to restore balance.
Yanowitz’s token portfolio is BTC, SOL, HYPE, Zcash, and Morpho, with Bitcoin largest and Morpho smallest. He recommends Robinhood and L2 exposure and says he owns both, including early Arbitrum exposure. Santos separately says he is very long Robinhood and Coinbase. Santos’s strongest chain call is Solana, which he says is “literally years ahead” of most rivals after preparing for sustained demand. Robinhood Chain handled some initial volume, but its fees “got out of control,” whereas Solana has already spent years engineering for that moment.
6. Stablecoin concentration is becoming a bull-market signal
Yanowitz is emphatic about USDC’s network effects: friends building DeFi protocols tell him alternative stablecoins are effectively worthless to them because only USDC integrations move the needle. After Stripe bought Bridge, Stripe launched the single Open Issuance standard rather than an ecosystem of equally important coins—his evidence that “the many stablecoin view has failed.”
Santos expects many stablecoins to launch without winning meaningful volume. His base case is an oligopoly: Tether’s and USDC’s market shares have not shifted much, while distribution is the cleanest indicator of potential displacement. The question is not how many issuers exist but where users already hold liquidity and where applications integrate it.
Blockworks data showed BNB Chain nearing the point of overtaking Tron for the world’s largest number of stablecoin holders. Santos reads the shift as a bullish retail signal, separately arguing that more retail accounts on Binance and more stablecoins being held typically indicate that users are preparing to come on-chain and bid assets.
Santos says exchange tokens have historically been among crypto’s best-performing tokens. Yanowitz’s BNB logic is volume-first: he does not need to predict the direction of travel, only that there is more travel and more volume. He sees Robinhood as an analogous equity expression.
Full transcript
1. Do Most Fomo Traders Lose Money?
All right, everyone. Welcome back to Empire. It’s Santi and me—no Rob, as it should be. Get out of here, Rob.
Which means, ladies and gentlemen, we’re not going to talk about regulation, Polymarket, or the Dragonfly portfolio.
I saw Rob. I was supposed to speak at that Stablecon event with Rob. I couldn’t make it, but Rob was looking dapper. I saw a picture of him.
No doubt. No doubt.
Santi, how’s New York?
What are you doing in town?
It’s great.
It’s electric. I’m here with the team. It’s the best time to be in New York. The US Open’s going on, and Fashion Week’s going on. I’m not part of either, but it’s a great time to be back—a great time to be back in the city. A lot to talk about, man. What’s going on in your world?
Who’d you see at the US Open? I saw Coco beat—what’s her name? Anisimova or something.
You didn’t stay until 3:00 or 3:30 in the morning to see Alcaraz?
No, no, no. My flight got canceled twice, so I couldn’t make it in time. I landed and was very jet-lagged. Incredible match. Did you see it?
No, because it started at 11:00 p.m. and went until 3:00 a.m. I don’t know what the US Open’s doing this year. It makes no sense. But you should watch it. There are extended highlights. If you go on YouTube and type in “extended highlights Alcaraz Shelton,” it is the most athletic game of tennis I think I’ve ever seen in my life. It’s an unbelievable match.
Yeah. I mean, we’re not going to talk about the US Open, but 2 things are pretty impressive: the age of these athletes—they’re 19, they’re 18—and the athleticism.
And the number of Americans who have gone far, both men and women. But, yeah, some pretty good stuff. Good to see it.
2. Crypto’s Animal Spirits Return
Okay, you don’t want to talk about the Open. What do you want to talk about? Tokenized stocks. Robinhood.
Been in the trenches.
Been in the trenches. Okay. So, you guys—okay, I missed last week, and I didn’t listen, so I don’t know what you guys actually talked about. Hopefully, you guys were talking about Robinhood.
Oh, absolutely. I mean, I’m back in the trenches.
Are you on FOMO?
I downloaded FOMO about 2 weekends ago, and it was an electric weekend because you had a huge run-up. You had Meme, you had the whole debate about these public-company CEOs being really vocal and critical about these memecoins, paired with tokenized stocks. Then Vlad is getting involved.
I saw Meme run from basically $0 to $100 million, and then obviously Boner, which is the memecoin tied to him. It’s a really interesting phenomenon. Then, obviously, the entire showdown now—there’s really interesting stuff happening in the trenches. We’ll cover some of it here.
The things I find interesting are the sheer growth of Robinhood and what it’s doing to its business, these memecoins paired with tokenized stocks, and Solana putting up a good fight now, saying, “Wait a minute, not so fast. We’re not going to sit idly by.” You have Raydium, STON.fi, and Pump. These chain wars are back, and memecoins are back. It just feels like Solana—we’re kind of in a moment, you know? It’s like things are 2024.
No, things feel extremely alive right now. Do you remember when—I’m going to take this from Mike, because Mike and I were catching up about what this moment in time is that we’re in. I’m going to steal this from Mike, which he pointed out. He said, “Do you remember when the Cointelegraph intern, in the last cycle, tweeted out”—I forget exactly what it was, but something about the Bitcoin ETFs—and we had that 10% candle, and everyone was just in disbelief?
3. Is Solana Still Years Ahead?
I remember we recorded an episode right after that, and I think no one could believe that we could even see a 10% candle again. We had been in the bear market for so long that this idea of a 10% candle was crazy. I think that’s what the last couple of weeks have been. Do you remember what happened right after that?
Memecoins started moving.
Yeah.
Memecoins started moving, and we had Fartcoin. I know Fartcoin came later, but you had Pepe. You had everything.
Yeah, you’re right. You’re right. You’re right. Pepe ran hard.
Then you had the disbelief. Everything ran hard. There was disbelief on the timeline that we could be in a bull market. There was so much of, “This was a short squeeze. We’re going to go back.” There were so many reasons why it could never be a bull market.
My take is that this is what the very beginning of a bull market feels like. I tweeted out a couple of months ago, “$65,000 generational bottom,” and I had just started. I don’t get many of these calls right, but I think that was a good call. That’s what I think we’re in.
We had the 10% disbelief candle. We’re having a really fun run with memes. I’m totally not involved because I’m way too busy with Blockworks, but for people who are involved, we had a guy at Blockworks make $3 million on one of these.
Average crypto Joe or average Joe, right?
I don’t want to say who did well, but we had an analyst. We have a couple of analysts who are just printing.
There are a couple of analysts at Blockworks. Maybe she’s got to start a hedge fund, but the Blockworks analyst community has been—
Do you know, every cycle, people end up throwing money at us and saying, “Go launch a fund.” I know it’s late cycle when LPs start throwing money at us and saying, “Go launch a fund.” So, we’re not there yet.
We’re not there yet. There you go.
Yeah.
Yeah. I had this idea of you want to be buying when you want to puke, and you want to sell when you start taking screenshots of your portfolio. I don’t think we’re in either phase.
People ask me, “Where are we now?” It doesn’t feel like we’re in either. I’m seeing a lot of screenshots from FOMO, which is interesting, because I think the FOMO guys—you had them on the episode, and people should go listen to it—they really nailed it across many things. I think they finally got the social piece combined with a product at the right time. Timing can be everything, but you have to back it up with a great product.
4. Can Memecoins Unlock Tokenized Stocks?
The Robinhood chain launch—the platform is super slick. Crossmint, the ability to on-ramp super fast, and if you’re in the US, you can use Apple Pay. The interesting stat, obviously, because we can talk about some of the concerns that people might have, is that we should talk about tokenized stocks. We were having a discussion in the last episode: Is this actually positive or negative? I was of the opinion that it’s super positive, no matter how you want to slice it.
Tokenized stocks are positive, or memecoins are positive? Memecoin pairs are back. These liquidity pools of tokenized stocks and memecoins are going to be very important. They’re going to be the mechanism, the forcing function, to get tokenized stocks, market structure, liquidity, market makers, and eventually markets moving 24/7/365.
This will serve as the catalyst. It’s super inefficient now, and there are obviously issues around it. But I’ve always felt—
Memecoins really have stressed this. They’ve stressed the infrastructure more than any other piece of technology in crypto. Look at what memecoins did to Solana. For me, it feels like tokenized stocks took a slow approach and haven’t really taken off, and this is the way they take off. We’re going to discuss this a lot.
Yeah. You know what? Coinbase is in an interesting spot right now, because I think the Hunter Biden laptop coin just launched on Base. I’m pretty sure. You’ve got Coinbase, which wants to do real-world things, like bring creators on-chain, and it ends up just being like—
You’ve just got this Hunter Biden thing.
And then, on the other side, you’ve got Robinhood, which actually leaned really heavily into memes at the launch of the chain. Now they’re leading in tokenized equities along with, I think, Robinhood Chain, Solana, and BNB. BNB is also doing it.
Here’s a stat for you: the number of stablecoin holders. Do you know which chain has historically had the most stablecoin holders in the world?
BNB.
Tron, historically. Tron.
Oh, Tron. Yes.
Tron. BNB is about to, for the first time in history, pass Tron for the number of stablecoin holders. Go look at the Blockworks data.
I think we should talk a little bit about this pairing of equities and memecoins, because if you’re not in the trenches or you don’t read Blockworks, it’s a little tough to pay attention to. Do you want to give the overview of Boner and Hims?
Sure.
I’m glad you mentioned that, because we covered it a little bit in the prior episode, but I promised people that it wasn’t enough coverage, so we’d go into more depth. We have to, right? It’s the most important narrative, and it will likely be the most important narrative of this cycle.
Basically, how it works is you have—you’ve had tokenized stocks for a long time.
There are different flavors of tokenized stocks. Let’s not get into that just yet. There’s a lot of discussion online about how Robinhood is doing it and how Backpack is doing it.
Let’s get there—but pun, get there, but pun. Let’s get the pun.
Tokenized stocks; then along come memecoins. The combination of the two is that you have a memecoin like Artificial, which you deposit in an LP pool. In this case, Artificial is backed by Nvidia. People should listen to this in the context of Uniswap and DeFi.
Then you have BONER, backed by Hims, which is a company that provides medication for erectile dysfunction. Hence, BONER. Then you have a memecoin tied to AMC, the cinema franchise, and so on. You have Memory Moo, which is backed by Micron, a memory company.
You have many of these pools, and the rough mechanism is that you have a pool, so there is always some sort of imbalance. Over the weekend, there’s only so much inventory in a place like Robinhood. They might have, say, 100 shares of a particular company, but if you have a lot of demand—which is happening here, especially on the weekends—you have more and more demand coming in from places like FOMO, where you’re buying more and more of the meme.
There’s an imbalance between the meme and the stock, and that creates an imbalance in the pool. For instance, when BONER launched, there was such an influx of flows that the implied price of HIMS over the weekend was 3 to 4 times the actual closing price of HIMS on Friday.
Come Monday, the authorized participants—I think Robinhood selects a couple of these institutions—have to refill the pool. They have to go get more versions of the tokenized stocks to balance this thing out. That’s the crude explanation of how this works. It’s an LP pool.
Here’s what I’ll tell you: a lot of people will say it’s backed. If you buy this memecoin, they’ll say it’s backed by shares of whatever it is. That’s not true. In no version of what’s happening right now do you have a claim on unwrapping or getting a certain representation of the underlying.
The only thing I would say is that this started happening 2 weeks ago. What’s happening more recently is that you’ve had this ZAI, for instance, which is a memecoin of a privacy-focused, anonymous cat, I think it’s called. It’s a pure memecoin—a cat with a cardboard box or something, playing on privacy—and you get airdropped Zcash.
It’s a flavor and variation that’s pretty interesting, actually. It’s basically like you’re getting a dividend on the underlying. Of course, it’s gotten a lot of popularity because Zcash has run up quite a bit. We should talk about it as well.
5. Ads (TOKEN2049, Avalanche)
I’ll pause there because that was the other interesting primitive. I tweeted when I saw it, and I was in FOMO. I was like, “I don’t think I’ve seen as interesting a primitive since DeFi summer.”
6. How $BONER Squeezed Tokenized $HIMS
Yeah, I agree. Okay, let me try to go a little deeper, and I’m going to pull a lot of this from Blockworks. I’m going to read some of this.
There are 2 assets. You have HIMS, which is a stock that trades on the New York Stock Exchange, and then you have BONER, a memecoin that was launched on August 20. What they did is tokenize HIMS. Tokenized HIMS is a Robinhood stock token on the Robinhood chain. 1 token is supposed to track 1 HIMS share, right?
But—and you were alluding to this—it’s not actually 1 share. It’s a Jersey debt security that is backed, in theory, as I understand it, 1:1 by real shares at a custodian. They’re not actually taking HIMS and putting it into a vehicle. So you have no votes, no shareholder rights, and a tiny float compared to the real company.
Then you have BONER, this memecoin, which is mainly a joke. What people did is they took a Uniswap AMM, like a V3 or V4 pool or something like that. You’ve got BONER and HIMS tokens, and these are the separate markets.
So when you buy BONER with HIMS, you send—I think I’ll get this correct—you send HIMS into the BONER-HIMS pool. The pool sends you BONER. The pool’s HIMS reserve goes up because you just put HIMS in there, and the pool’s BONER reserve goes down. So BONER becomes more expensive priced in HIMS. I think I got that correct.
This does not, in and of itself, make tokenized HIMS worth $130. It’s locking HIMS inside of the meme pool. Those tokens are no longer sitting in the HIMS pool—the other pool, which is HIMS-USDC, or I think it’s actually HIMS-USDG.
Yeah.
That’s where the price discovery happens. So the reason that pumps it is—
The tokenized HIMS supply is only created by these authorized participants, and it’s only set in this window. I think it’s Monday through Saturday or something; maybe it’s actually Monday through Friday—I’m not sure. So on a Saturday or Sunday—
Nobody can mint these new wrappers, so the on-chain float is fixed. So you essentially had a squeeze, right? I think there are 60,000 HIMS tokens in existence. Over half of them were sitting in the BONER-HIMS pool. So you essentially took half the supply off the market and—
Yeah. Yeah.
Anyways, I think that’s the sequence for the weekend.
Yes, yes, yes. You’re not creating a short squeeze as such.
Sorry, it’s not a short squeeze.
No, no, it’s a short squeeze on the pool of the authorized participant that it has, which is a very small fraction of the total float of the stock.
You essentially took so much of the free float and put it into the meme pool that the price of BONER in HIMS—or maybe I’m getting that flipped—went to $132.
Yeah, that’s right. But of course, what’s interesting is—
HIMS priced in BONER. Yeah, there you go.
Yeah. Yeah. What’s interesting is seeing the CEOs of these public companies go out and say, “Wait a minute.” One of them had a really good quote. He said, “I woke up a loser.”
He saw all this demand for the memecoin, but it wasn’t necessarily doing that much for him. For one, he didn’t participate in the $100 million, you know, out-of-thin-air value creation, if you will.
But the question that I pose, and what could be interesting, is whether there are going to be instances like—imagine a “believe in something” kind of thing—where some of these memecoins, like PEPE and Shiba Inu, run up to $17 billion or $20 billion. What happens in a world where there’s 100 times more demand for these memecoins that are in these pools?
What does that do to Robinhood? What does that do to market infrastructure? What does that ultimately do when you just have these LP pools and authorized participants basically start buying? What effectively ends up happening?
The downstream effect of all this is that Robinhood needs to go and find, source, and keep in its inventory more and more shares of whatever these memecoins are paired against, whether it’s GoPro, SanDisk, Micron, or Nvidia. Of course, a company like Nvidia, the most valuable company in the world, doesn’t move the needle. But if you have these small caps, like GameStop, it may actually move the needle quite a lot. It’s really interesting.
7. Robinhood Faces Meme-Equity Backlash
Did you see the AMC CEO, Adam Aron? There’s a lot of backstory about this guy. He was the former CEO of Starwood Hotels, Norwegian Cruise Line, and Vail Resorts, and he was involved with the Philadelphia 76ers. He’s a controversial figure, to say the least. Some people are not huge fans.
But he tweeted. He’s currently the CEO of AMC, and there were 2 stocks that were really memefied. AMC has always been memefied, I think, by the meme crowd—even the non-crypto crowd, the Reddit crowd, I’d say.
The WallStreetBets crowd.
WallStreetBets. Exactly. So, he tweeted out:
“Robinhood apparently is behind an effort related to tokenized real-world assets, including stock tokens for AMC. They are not registered under U.S. securities laws. I find this practice to be contemptible, outrageous, disgusting, detestable, inexcusable, and vile. How possibly can it be legal? We have no connection to this at all. We do not condone it. We immediately are going to have our outside securities counsel look into this.”
This guy doesn’t get how the game works. He just got—
You know, I don’t know how I’m going to be able to find it, but there was a great—I think the chief legal—
The Robinhood—
Yes, the Robinhood general counsel, or chief legal officer, said, “I know a thing or two about securities laws.” He used to work at the SEC.
Exactly.
And Vlad has been replying to some senators.
Right here. Vlad said, “What’s the concern?”
Yeah. But there’s a pretty epic reply from the Robinhood chief legal officer to one regulator. He said, “We will not desist,” meaning, “We will not back down.”
Dan Gallagher, I believe.
Dan Gallagher.
Yeah.
So, look, Robinhood is—talk about an organization that is not going to step down. It’s going to put up a fight. Coinbase has fought the SEC many, many times and won most, if not all, of the cases. Paul, who now works at Cognition, put up a really good fight.
Yep.
Yeah, 100%.
What’s your read on all this stuff? Are you getting people calling in saying, “Hey, what’s going on? We need research on this stuff”? Do you have hedge funds interested in this? Is it even registering, or are they paying attention?
People are 100% paying attention. I actually had many interesting calls and meetings in New York over the last couple of days. One fund has actually been loading up on Hyperliquid. This was separate from the conversation, but they said the only reason Hyperliquid got on their radar was the pre-IPO stuff. You remember the pre-IPO—Cerebras and then SpaceX?
They said, “Why is everyone sending us this platform called Hyperliquid?” They didn’t even know it was a place where you could trade. They thought it was a data site. Then they realized you could buy the HYPE token.
8. Are Onchain Equities Crypto’s Future?
So, anyway, that was a little insight. Here’s a message I got from both—I’d call it—the New York crowd and the D.C. crowd. The institutions and the regulators said, “The number one thing that matters to us right now is on-chain equities. On-chain equities are the single most important thing we’re trying to figure out.”
Blockworks is sprinting pretty rapidly to release some things to help figure out what’s going on with on-chain equities. If you look at how these things are set up, they’re essentially debt instruments. If you look at what we did with the Token Transparency Framework and tokens, I think there’s a very similar need in the market to figure out these on-chain equities. They’re all custodied in different places, and they all come with different rights. In some cases, people are actually buying the one-to-one tokens. I think Matt Levine had a great piece on this.
On-chain equities are by far the single hottest thing in crypto today.
Yeah.
What do you think?
No, I totally agree. This is a convergence of the 2 most important things that are already happening, combined. It’s explosive because it draws in memes. Whether you like them or not, love them or hate them, they are the first proven real product-market fit, if you will. There’s a lot of interest in memes.
Then you combine that with tokenized stocks, and a man can dream. I tend to think that these things will pave the way for NASDAQ on the blockchain and all this stuff. The sheer volume is like opening a massive fire hose to sort this thing out.
If the downstream implication of this is pushing and paving the way for 24/7/365 markets, we were going to get there eventually. I think we just get there faster because of what’s happening now. Who are the authorized participants? How are they compensated? How does this mechanism work?
I don’t necessarily think we need to go into this discussion on the podcast, but it’s worth keeping in the back of our minds: What is the best way to tokenize a stock? There are different flavors, and I think we should have a discussion on DEXs in Asia, like Backpack, Robinhood, and other folks that are doing it, because I don’t think we’ve figured out that model.
I think Matt Levine summarized it nicely. I’m going to read from this Matt Levine piece from 2 days ago. He said:
“And then there’s tokenization. I sell you a token on a crypto blockchain representing AMC stock. What is a token? We’re still in the early stages of tokenization, but conceptually it could be 1 of 4 things.
“It could be effectively stock, right? AMC issues its own stock in tokenized form. Its ledger is maintained on the blockchain, and someone buying an AMC stock token is just buying AMC directly on the blockchain. That doesn’t really happen today, right? That is the dream, but it doesn’t happen today.
“Number 2, it could be effectively an SPV. I buy 1,000 AMC shares, put them in a pot, and issue exactly 1,000 tokens against that pot. Each token represents an AMC share in the pot. Some people are now starting to do that.
“Number 3, it could effectively be a swap. I issue 1,000 tokens, each representing an AMC share. You buy them, Santi, and now I owe you the return on 1,000 AMC shares. That’s the third possibility: the swap.
“And number 4, it could effectively be nothing, which I think in many cases is the case. I issue 1,000 tokens, each representing 1 AMC share. You buy them. I don’t actually owe you anything.
“So, when you see all this tokenization—Robinhood is going around tokenizing a lot of stocks—what is the thing? Is it an underlying share held by a custodian in the U.S.? Is it held in the Cayman Islands? What is it? Is it nothing?
“I think that is the important thing to look at. My take is that users do not care in the slightest when things are going well. When things are going well, users don’t even think that this is an issue. Then, in 24 months, when something happens, as it always does in crypto, it will matter a whole lot.”
Yeah. Let’s not forget, last summer, Robinhood announced access to pre-IPO companies, and there was a fierce backlash from the founders of these businesses. They said, “I don’t approve this transfer, and we’re going to deny it if you’re an investor in these effective SPVs. Good luck. We’re not going to honor them.”
Anthropic, Stripe, and OpenAI all came out saying, “We have no knowledge of this. We didn’t approve the transfer.” Whoever you’re sourcing the inventory from, good luck, because we’re not going to honor that.
I think that’s sort of the last point Matt was making. I don’t think you get anything. I don’t think you get governance rights. I don’t think you have the dividend—TBD. But let’s not forget, if you’re in an SPV, you’re trusting Robinhood and the mechanism of redemption, or whatever it is. You’re still taking some counterparty risk.
The question is, do you trust Robinhood? Do you trust its mechanism? It could get contentious. We still haven’t seen that yet.
Yeah.
I wonder what that might look like. If it’s a true short squeeze, or a community takeover of a super-small microcap, and that happens on-chain, it could be interesting.
We should probably have the Robinhood folks, Armani from Backpack, and Rob Leshner from Superstate. That would be a banger panel to talk about this stuff.
Permissionless Asia, baby.
There we go.
Permissionless Asia. We’ve got it teed up. Soft plug.
A hard plug, if you’re going to tee me up like that.
All right.
You know what else was interesting this week?
What? What?
Oh, is there anything? Well, okay. Tell me about FOMO. What are you doing in FOMO?
Well, you know me. People are calling me a plumber and an uncle, but—
You know—
Santi’s like, “I’m really rich, guys.”
No, no. Once a DJ—
Santi loads up his FOMO account just to be at the top of the leaderboard. He’s not actually going to trade, people. He just wants people to see.
I just—listen. You know how to be number 1 on the leaderboard? Just deposit large sums of money. Don’t trade, because obviously the stats of—
Oh, my God.
The stats. That’s not me, by the way, ladies and gentlemen. The stats are what you would expect. Most traders are not making money. There are some interesting stats circulating around. We can pull them up now or share them in the show notes, which we don’t have a good track record of doing, but basically 90% of people don’t make money. Only a handful make money. You have the data?
I don’t have the data, but we have—I remember working with one of the big brokerages, and we would have to say in the disclosures that 82% of their users lose money.
So, I don’t think it’s just FOMO, by the way. I think maybe it’s FOMO, like Hyperliquid. What percentage of Hyperliquid users sit on HYPE? A lot of them have made a lot of money from sitting on HYPE.
But what percentage of Hyperliquid traders who are trading—
Binance, Coinbase—by the way, pull up Bloomberg and CNBC, and you're going to see an Interactive Brokers commercial at one point.
Look at the fine print. It says exactly what you said: most users are not making money on these products. It's a disclaimer that they make.
Yeah.
It's the last thing I'll say. Do we have to talk about Hunter Biden's coin, Laptop, launching on Base?
Do we have to talk about it?
We don't have to talk about it, other than that it hit $25 billion, went all the way down, and is sitting at $600 million. Interesting choice launching on Base. The only reason I bring it up is that it caught a lot of attention. I got more people pinging me about that than anything else over the last week.
And about the Hunter Biden token?
The laptop thing. I didn't buy it. Of course not.
No, no, no. I'm surprised people are paying you. I think there is just a group of people in crypto that I'm so removed from at this point. Did you see The Chopping Block, Laura Shin's show, with Haseeb and the others? They were talking about FOMO, and people were getting roasted because it was a bunch of boomers talking. People were saying, “These washed-up crypto guys are trying to describe what's happening with FOMO.” That's how I feel when I see Hunter Biden's laptop. I'm like, who in their right mind is buying this thing? But it makes me realize there's an entire section of crypto that I'm so removed from at this point.
9. You Must Enter The Trenches
The point I'm making is, if you want to understand crypto—and this was the mentality we had at ParaFi—you have to be in the trenches. You have to be in DeFi. You have to understand yield farming and how Uniswap works. Deposit ETH and see how impermanent loss works. If you want to see oracle design, get rugged when the oracle malfunctions. For me, it's always been that you can use these things, but 90% of the VC guys don't use them. How can you talk about what's happening on-chain if you're not using these products? If you're not using stablecoins?
You're using FOMO was very interesting to me. It was very interesting because you have not—
You have not been excited about crypto in, I would call it, 2 years.
That's right.
And now you are downloading FOMO. Does that mean something's changing?
Yeah, 100%. I reserve the right to change my mind whenever I want, and I can invest in whatever I want. If tomorrow I decide to put all my net worth in Hunter's laptop, NFA, I can do that. There have been certain times where someone has said, “Hey, maybe this is not the wisest thing,” and I said, “Politely, fuck off. I can do whatever the hell I want.” This is why I don't run a fund.
10. How Santi Is Playing This Cycle
So, 2 or 3 weeks ago, I asked you if you were starting to allocate, and you said, “I'm starting to get interested in things.” Now I can see that you're very interested. I know you well enough at this point to see that you're very interested. You're back. You're engaged. You were talking to founders, which we were texting about. You're talking to new founders building new things. Santi's going to throw out an angel check or 2. I haven't seen this in a while. From an investment perspective, are you starting to buy any tokens or not yet?
Look, I'll say it again: I think the best way to play the cycle is to go long Robinhood, maybe the L2s. Full disclosure, I own both. I was an early investor in Arbitrum.
But take out the early-investor things, which you've got unlocked. Think about new capital—net new capital.
The exercise I always do is that any day I'm not selling is a day I'm buying. I constantly rewrite my portfolio from scratch. If I were designing my portfolio, when you think about the best way to be long the growing tokenization and stablecoin trends, Robinhood is the answer, in my opinion. It seems to have a lot of traction.
I think the Robinhood chain, similar to BNB, is this phenomenon where they're earning a lot of fees. The guy from Milk Road had a really good analysis. It seems like they're going to continue to get more attention and users there. It's not going to be the only chain.
I don't like the L1s. I don't like Ethereum. Sorry, guys, I still don't like ETH. It's a $300 billion market-cap token, and the fees just don't make sense. I do think we're going to continue to talk about fees, and maybe there's some EIP-1559 discussion to restore some balance.
But if I want to go long Ethereum, I buy Robinhood and Arbitrum because that L2 is supporting the Robinhood chain, and they're making quite a bit of fees on the activity happening on the Robinhood chain. To me, that's a very clean way to play the cycle.
I still have a small fraction of what you always need to have: a YOLO bag, which is playing on FOMO and playing with these mechanisms to understand them and really understand if they're going to be real. If Robinhood is going to continue to grow, HYPE is interesting because of what's happening with potentially bringing it back to the U.S., or bringing it to the U.S. I don't know if you have an update there.
I don't really buy Rob's argument that it's capped. It feels like it's capped, but perpetuals are going to continue to be massive.
I mean, HYPE is one of the only tokens I own. It's HYPE.
Oh, really? What else do you own?
I own, right now, Bitcoin, Solana, HYPE, Zcash, and Morpho.
In that order?
No, not in that order. HYPE and Zcash have gone up a lot. I think HYPE and Zcash were 3 and 4, but they've gone up a ton. Morpho is the fifth. Morpho is the lowest, but Morpho hasn't really moved since I bought it.
HYPE and Zcash were probably 3 and 4, but they've gone up a ton. Bitcoin is number 1, and then probably Solana or HYPE is 2 or 3.
What's your thesis on Solana? It hasn't gotten that much love. People have sort of seen the activity on Robinhood and said, “Yeah, Robinhood's in second gear.” But I do think—
What they have built is so far ahead of any blockchain other than Ethereum. In other ways, Ethereum is unbeatable, in areas like decentralization, but those are areas that I don't think users and builders care much about. That's why I think Solana has done an incredible job.
I feel like Blockworks gets a bunch of criticism for being biased toward Solana, but I think we were extremely right about it. I'll just put that out there.
You were right on this podcast.
Yeah, I think Solana is still miles ahead of so many other chains. Robinhood chain, by the way—I'm also very long Robinhood. I didn't mention the stocks. I'm also very long Coinbase. I know I was just ragging on Coinbase, but I'm also very long Coinbase.
I think Solana is literally years ahead of many other chains. Sure, the Robinhood chain could handle a little bit of volume over a 3-day period, but the fees really spiked.
It got out of control. Maybe at this point in the market, retail users don't care that they're getting rinsed on fees. Maybe that's the answer. But Solana has done so much to be ready for this moment, and I think it will have a phenomenal next couple of years as well.
Have you ever bought BNB or held it?
Never held it? No.
Really? Interesting. BNB did extremely well off the bottom.
Do you know that exchange tokens are the best-performing tokens in all of crypto? If you look over time—
My point there is that, other than FTX for other reasons, I remember owning BNB early on. For me, it was that I don't necessarily need to be right about the direction of travel. I just need to make sure that there's more travel happening and more volume.
I think when you think of it from that lens, it's probably the more simplistic way. It's like owning Robinhood, right?
Do you ever think Robinhood or Coinbase would launch their own token?
No comment. I think—
No comment.
No comment.
That means you know something. Here's what's interesting.
The “no comment” means you know something and you don’t want to say it, which means there is some probability that they have a token. That’s my read.
I would guess they do.
Yeah, I actually don’t know anything. I would guess they do.
11. Will Stablecoins Become An Oligopoly?
What about Coinbase? I’m interested in your view there because, well, you didn’t mention Circle, but—
By the way, Circle is another one. I think Circle is going to do incredibly well. Circle is one that people hate. Do you know the network effects of USDC? I have a couple of friends now building new DeFi protocols. Every other stablecoin is entirely worthless to them. Even with Tether, USDC is the only thing that moves the needle for them.
Yeah. Interesting. Yeah.
Having a million stablecoins doesn’t make sense. Look at it. Stripe bought Bridge, right? Stripe bought Bridge. Bridge lets everyone launch their own stablecoin. What did Stripe just launch? The Open Issuance standard. The Open Issuance standard is a USD. It is one stablecoin. That is a validation, in my opinion, that the many-stablecoin view has failed. Why does Phantom need its own stablecoin? Phantom doesn’t need its own stablecoin.
What do you think?
No, I agree. I think we will see a proliferation of stablecoins, but that doesn’t mean they’re going to get real volume. We were talking a lot in this podcast about what that means for stablecoin issuers. I think it’s an oligopoly. Tether’s market share hasn’t really moved much. USDC’s share hasn’t really moved much.
Where they’re distributed, I think, is probably the cleanest signal for you to understand if there’s going to be some displacement. Like you just mentioned, Tron losing market share to BNB, to me, is a read that we’re entering a bull market. More retail accounts on Binance and more stablecoins being held are typically bullish indicators that people are looking to come on-chain and bid stuff.
Yeah.
Yeah, 100%. By the way, we finally have really amazing stablecoin data. We’re a late mover in this, but people can just go to our website. It’s all free. Go to Analytics, then Stablecoins. This is the chart that I was showing and talking about before. Look at this. This is Tron. Look at BNB, about to pass them. Pretty unbelievable.
What am I saying? It makes sense. I hadn’t paid attention to this, but—
This is just the number of people in the world who hold stablecoins, based on the blockchain they’re on. So, Tether on Tron, Tether on BNB, and then, actually, the green—look at this one. Remember Celo?
This is Tether on Celo.
Then it goes Tether on Base. No, excuse me. Then it goes Tether on Ethereum, then USDC on Base, USDC on Solana, USDC on Ethereum, and then there’s a big drop-off.
Wow. Yeah. What else, man? I mean, we covered BNB, and we can cut.
I’m late. I got a final-round interview, so I’ve got to cut this short.
Final-round interview. Where are you interviewing?
We’re hiring sellers, baby.
Yeah, that is it.
12. Content Of The Week
Okay, well, 2 minutes. We have content of the week. One second.
Go ahead.
What do you got?
You start.
I’m reading The Fastest Tortoise. It’s by one of the guys who partnered with Richard Rainwater, a famous dealmaker from the Bass family office, and then started Natural Gas Partners.
Bass, really?
Yeah, it’s called The Fastest Tortoise. Really good book.
Nice. I just read the blog post by Dwarkesh Patel, “The Rise and Fall of Agentic Civilizations,” which is—
I don’t know how I feel about it yet. I feel like it’s both very hyperbolic and also really cool to read and an interesting story. I literally just finished it before jumping on, so I’m not entirely sure how I feel about it, but I’d recommend reading it.
A lot of whistleblowers from Anthropic, you know, calling the civilization—
That I disagree with. That guy’s been there for 6 weeks, and he’s a junior employee.
Disagree. Agree. All right, man. Go to your interview. Good luck.
See you, folks.