Dan Smith：ORE 解析、加密货币的未来、Blockworks 数据及更多 | TG Podcast

What’s up, man? How are you?

What’s up, man? Pleasure to be here. I’m doing well. It’s an interesting week so far. We got some big news today, so that’s fun.

Dude, it’s kind of been a secretly, sneakily fun last week in crypto. Are you referring to the Uniswap thing, or what are you referring to?

Yeah, the Uniswap thing. I was just watching the stream. Sorry about TBNN, man.

Dude, these [__] guys—game is game, man.

I like the approach. I always joke that we’re just going to go guest for guest until somebody gets Trump on. Maybe. [Laughter] Game is game. I’m excited to see the clips after that. What do you think about Uniswap?

It’s interesting. There was a lot of chatter in the streets over the last couple of days, and then we saw—I think it was—a Chinese news agency break the news about 5 hours ago. Then the forum post went live. You could see it in the chart, which, candidly, is kind of a problem, but from a higher level, it’s good that this is finally happening.

I’m a walking contradiction when it comes to the Uniswap fee share because, on one hand, I don’t really love the idea of protocols or companies sharing revenue with the token on day 1. I’m a “let’s build the runway” kind of guy. There are no perpetual motion machines; when you share 100% of revenue, that means you’re doing some fancy accounting and generally funding the operation of the business with token sales.

So it’s kind of in one door and out the other. Generally, I supported the idea of holding the line on the fee switch on the Uniswap side of things. The proposal is actually pretty interesting. One thing I like is that they’re turning off the frontend fee on the Labs side of things as well. There was always this equity-token relationship, which maybe exists to a lesser extent now. It’s pretty hard to undo that, but the legal team at Uniswap seems like they’ve been candidly working toward it.

That was a good plus-one to see. There were also some interesting ideas around MEV internalization for Uniswap. I haven’t been able to unpack exactly what that mechanism looks like, but if you’re turning on the fee switch, you’re ultimately lowering the amount of fees that go to LPs, right? If I’m a trader and I pay $1 to swap, that full $1 currently goes to the LPs in the pool. But if you turn on the fee switch, it would be a 95/5 split or a 90/10 split, right?

If we lower LP profitability, doing some MEV internalization could be interesting to basically counteract that. That was pretty cool. I liked that. The one thing that immediately turns me off is the token-burning thing. Burning unissued tokens from the treasury doesn’t mean anything. It’s just that you get to say you did it.

I think it’s 10% of the supply, but those tokens are unissued and uncirculating.

I got excited about this. I’m like, “Oh my God, 10% of the supply.” Then someone in the chat was like, “Dude, it’s already off-market tokens that are chilling in the treasury. It means absolutely nothing.”

Can you explain in layman’s terms why the proposition of a fee switch is bullish for token price action? For people who aren’t familiar with Uniswap, as much as you know, what does that literally mean?

Yeah. The DAO will now be collecting fee revenue. Using a very simple example, let’s say I trade on Uniswap. Right now, if I pay $1 in swap fees, all of that goes to the LPs in the pool. If it’s a USDC-ETH pool, then whatever LPs are providing the liquidity I can trade against get all the fees.

Yeah, 100%. So the fee switch basically bifurcates that—it breaks it into 2—where now 5% goes to the DAO and 95% goes to those LPs. The DAO starts collecting these fees as revenue.

The reason that’s bullish is that the next step is either we’re going to buy back and burn the UNI token using that fee revenue, or distribute it to UNI stakers, or do something interesting like that.

So this whole time the DAO has made nothing?

Nothing. Not a dollar.

What the [__] is that?

They also had that frontend fee. If you go to the official Uniswap frontend and execute a trade, you’ll pay an additional fee that the Labs entity was taking.

Again, there’s a token, there’s equity in the Labs entity, and there’s a push and pull between those 2 things. That’s why I think the forum post was called “Unification,” with UNI in all caps, because they’re trying to make it one single entity.

How big of a deal do you think this is? Is UNI now an interesting trade for you? I bought a bag and I’m watching it, but I’m just trading momentum in the chart. Does this become an interesting long-term trade? Is it something you’re looking at, especially on the data side, if this goes through?

Yeah, the chart does look cursed, man. It’s like that meme where there’s a straight red line down, and then the guy’s cheering because it goes up 1 small green bar.

From a high level, I think it’s really good for the industry to have a major project like Uniswap, which has been instrumental in the last 4 years of success we’ve seen in DeFi, willing to get out of this trend and say, “Regardless of regulation and how that’s changed and progressed, we want to actually turn this on.” That was something they had hung their hat on as to why they weren’t doing it.

I think it’s good from a high level. Is it an interesting trade? DEXes are a hard game, man. It really, really is. It’s a super-low-margin business in the long run, most likely, like many things.

I think the interesting catalysts here are whether they can get Unichain spun up to an exciting place, or whether Uniswap v4 hooks become this interesting platform-style play where you can build really complex DEXes on top of the Uniswap v4 system. Those could be 2 interesting things here.

But from a high level, I’m not in the trade. It doesn’t get me super excited, but I’m definitely going to keep an eye on this one.

Cool. By the way, I didn’t even give you a chance to do an intro. Do you want to give a quick intro into who you are, what you do, and then we can get into some more fun stuff?

Yeah, for sure. We went straight into that.

I know. I was excited. I like staring at a [__] leverage trade. I’m all [__] amped up.

I love it. I love it. Yeah, man, I’m the head of data at Blockworks. I’ve been building out the research and data product for the last 4 years, and now I spend 100% of my time thinking about how we can bring on-chain data to life.

I think the industry does a great job of wanting to tell stories based on what’s happening on-chain. We have this really unique value proposition, right? Blockchains are giant, open APIs, just spitting off data nonstop. They allow you to take that data, understand what’s happening, and communicate it outwards. That’s what gets me jazzed up, man.

I love putting together a dataset for the first time that no one’s seen before. That’s what I’ve been doing recently with Ore. It’s an interesting thing, what’s going on there. Am I obsessed with it? I don’t know. It’s probably a no. I kind of agreed with your framing: is it the future of fans? Probably not. But TL;DR, I love tearing into on-chain data.

I love that you wake up and think about data. It’s awesome. I think that’s awesome.

Go to sleep, think about data, dream about data.

It’s awesome. You do great work. I’m a fan of your posting. I love the PFP as well.

Okay, let’s just start with Ore. I actually have a bunch of stuff for you, but let’s start with Ore. I’m going to be completely honest: I still don’t really get it. I guess I do. I get it. I don’t get why it’s going to $1 billion.

Obviously, Frank is a good friend of mine, and he had a pretty public trade on this. I think he was very excited about it. We kind of missed it on the stream, though. I was covering it and thought, “Ah, it feels lame,” and then all of a sudden it started going crazy.

The data guys love it. The revenue guys love it. Everyone’s all excited about it. The store-of-value guys love it. The PFP guys love it. It’s a fun crew overlap that loves it. Can you break down what it is, and then we can get into some more specific details?

Yeah, 100%. You actually just hit the nail on the head there. It got a lot of weird pockets of crypto jazzed up, and I think that’s a testament to its success. It’s actually got quite the lore, too.

It’s actually 18 months old, or maybe just shy of that. If you remember back in early spring or late spring, early summer of 2024, it sucked transacting on Solana, or was at fault.

Their first iteration was very much this heavy proof-of-work system: solve math problems and get tokens in return for solving them. Each of those math problems was a transaction on Solana, so this was happening right when memecoin trading was getting hot, and all these transactions were hitting at the exact same time based on how the system was designed.

It was instrumental in the whole IBRL narrative of Solana: we get punched in the face, we solve the problems, we fix the problems, and we continue growing. It also has some really good lore. It went through a couple of different iterations of exactly what that proof-of-work mining game looked like, then entered a quiet lull period where I think the team was iterating on what the design should look like.

About 2 months ago, they relaunched the mining game. You have to break it apart to have a full discussion about what Ore is. There are 2 components: the asset, and the actual mining game or system.

Maybe we’ll cover the asset later, because that’s the store-of-value side of things. I think the game is far more interesting. Instead of solving math problems in the proof-of-work hashing algorithm game, they got rid of that and replaced it with a lottery. Honestly, I view it as a roulette game.

So there are 25 squares, and each square has equal odds of winning. The winning square gets decided at the end of a 1-minute round.

You have 25-to-1 odds to bet on any of them.

Exactly. If you bet 5 squares, you get better odds.

That’s the simple premise. There’s 1 extra piece layered onto that, which is the game subsidy, if you will. Every round, 1.2 ORE is issued to the winning square, which sets a minimum value for the winner.

There’s also a jackpot. The jackpot has a 1-in-625 chance of winning, so the odds are much lower. If it does not win, it increments by 0.2 ORE every minute, or every round. Right now, the jackpot is around $80,000.

So the jackpot gets stupid.

Yeah. When you look at the total value bet each round, as the jackpot grows, so does that number. Everyone sees this huge number and thinks, “All right, now’s the time to start betting.” It’s very cyclical relative to the size of the jackpot.

Whoa. Um, and then so that’s like the very simple outlay of what the game has become. And then the revenue portion of that is: you bet on the board by paying in SOL, and 10% of all SOL bet each round is taken as revenue. Of that, 90% is used to buy back and burn the token, and 10% is distributed to ORE stakers.

If, let’s say, $100 was bet on a single round, 10% of that is taken as revenue, so $10. Nine dollars is used to buy back and burn ORE, and $1 is distributed to ORE stakers.

So they’re just hammering buybacks.

Yeah, constantly. If you look at the buyback wall, it’s just constantly TWAPing.

At what point did you get into this trade, and what got you really excited about it?

I knew about it as it was launching, so I was immediately obsessed with it. I thought, “This is a fun, stupid, cool thing. All right, I’m in.” I got into it 18 months ago and got absolutely fried. I thought, “I hate this token. It’s the worst token ever.”

Once it started coming back to life, I was like, “I’m ready to get hurt again. Let’s get back in this.” Honestly, I didn’t pay that much attention to it. Then I played once, and usually crypto has a serious problem where using the product makes you bearish.

This was a rare moment where I was like, “Holy shit, this is actually a really quick dopamine hit.” I had fun, and I’m a little bit of a nerd, so I thought, “All right, what’s the optimal strategy? How can we actually try to game the system?”

It was fun. It’s actually fun. If I have 2 minutes to kill, I can pull out Phantom, open Ore Supply, and have a round.

How quickly do the rounds end?

1 minute. It ends every 1 minute.

What is—

It’s quick, quick, and dirty.

What is the optimal strategy?

What you really want to do is be the last person to bet. You want to bet on the square with the least amount of money, because the whole pot gets shared by that 1 square if it wins, and they all have equal odds of winning.

You also want to bet more aggressively when the jackpot gets to a crazy number. Right now, if you win 1 square, the average winning is somewhere between 1.5 SOL and 2 SOL if you bet 0.1 SOL, so it’s a pretty significant payout.

If you win the Motherlode square, though, and you bet 0.1 SOL, you’re taking home thousands of dollars. It’s a very basic casino-style game.

The store-of-value guys love to say, “That’s just the mining engine. The asset has all of the store-of-value properties.” To me, I focus on the system. The revenue chart is up and to the right. They did a $1 million day for the first time yesterday.

The revenue chart is screaming, but the key problem is that it’s extremely reflexive. As the price of ORE goes up, the jackpot gets bigger, the 1.2 ORE subsidy gets bigger, and there’s more betting. But if the price of ORE falls, like today, when I think it’s down from $600 to $300, then the game is worth half as much.

It’s hard to reignite that flywheel. It’s extremely reflexive. Are you down to share your screen and bet on 1?

Yeah, I set up a wallet so we can do it.

Wait, can you do it right now? I’ll share my screen.

Yeah. I’ve got to—okay, share your screen.

I won’t show it until you tell me you feel good.

Okay, cool. You tell me what to show, and I’ll show it.

All right, let’s let it rip. Can you see?

Cool. Can I show it?

Yeah.

Cool. All right. Can you see the ORE screen?

Yeah, I see your whole screen. I see the game board and the chat.

Perfect. Here are our 25 squares. We’ve got 30 seconds, so let’s just pick 5.

Is that SOL, or is it the amount of ORE bet? What are those numbers—1.5, 1.6?

Yeah, let me quickly get some skin in the game, and then we can walk through what we’re—

Oh, shit. Clutch.

Thanks. I know, it’s so—

All right, we’re locked in. These are our 5 squares, the blue ones. The 1.6 at the bottom is the total amount bet on that square. Ideally, you want the lowest, or cheapest, squares. These are all sold.

People in the chat are saying, “Shout-out to that guy.” That’s lit. No way. That’s awesome. What’s up, guys?

This round has $8,000 on it. The jackpot is the Motherlode, as they call it, and it’s at $82,000.

There’s a 1-in-625 chance, right?

1 in 625.

Cool. We need some streamer loot here. Come on.

I know. Give us a win. I want to see what—

What if we win the Motherlode on stream?

We’re splitting it, right?

Of course. Of course.

All right, here we go. Give me some bottom-row action, baby. Wow.

Are there people here all day playing this optimally? Someone said you’ve got to do 10 squares to get a win. Do 1 more. Do 1 more. Do 1 more. I’ll send you some SOL after.

No. No, no, no. It's all good. I threw $50 in here. We're using it all. Frank says, “Dan, lock the [__] in.”

Yeah. Hammer, like, 10 squares. You’ve got to hit it up. It’s basically a 50% chance you win.

Right here. Let’s just use the rest I’ve got. So, what, I got 14?

Yeah. Yeah. Yeah. Yeah. Okay. Okay. Okay. Okay.

If we lose this, it simply wasn’t meant to be. Someone said ORE also gives you 148% APR.

Yeah. So, you can stake ORE here.

Oh, I see. I see.

I mean, right now it’s at 22%, it looks like.

It’s kind of bad.

I don’t know. I’m not a staking guy. I’m a play-the-game guy. But, yeah, I mean, this is as simple as it is. There’s no more to it than this.

Now, the store-of-value guys, or the ORE diehards, will say that because there are net deflationary forces from people playing the game, it has store-of-value properties. I don’t know. That’s just not what gets me excited.

All right, let’s see. Let’s win this real quick. This has to be a hit, right?

It’s got to be it. It’s got to be it.

Yeah, it—

Oh my God. Fuck, man. What the fuck? All right. GG.

Unbelievable. Oh, no. We won. All right. It was 11. Okay, bet.

No, no, we didn’t. That was literally—I bet these—

GG. Fuck. Brutal.

Okay, thanks for the demo, though. That was sick, actually.

Yeah. Yeah. So, it’s literally that simple.

So, you said—let me stop watching. You said—okay, cool, you’re back. You said the store-of-value stuff doesn’t get you excited. What did get you excited about it from a data perspective? And then, I don’t know, we said at the beginning that it was cool that all of these random parties got really hyped on ORE, but I feel like we’ve seen games like this before.

I remember there was—well, a lot of people are comparing it to M. But what was the thing on Abstract that was kind of cool for, like, a week? Big Coin[?], where they had the miners. I think that went relatively high.

I don’t know. What got you excited about it, and then why do you think all of these technical Solana people totally like—why are they so jazzed about it?

I mean, I think they’re jazzed about it because it’s making money, and it’s not every day that you see a product have a million-dollar day. That’s hard to ignore from a “Okay, this is legit” aspect.

That was a top-2, top-3 app in all of crypto on that day—yesterday. So, that’s automatically, I think, fairly interesting from a totally retweeting-it perspective.

And then, me personally, though, I already knew about the existence of it. It was cool to see it not get abandoned 18 months later, and continued iteration on the product is always admirable.

But, yeah, I mean, for me, from a data perspective, there’s a lot to unpack here. The devs use some unique data structuring. It’s pretty nerdy, but I was like, “All right, no one’s really unpacked each round. What squares win the most? How many—what’s the average number of squares that somebody bets? What’s the average number of squares that somebody bets when they win?” Things of that nature. You can start really unpacking how people are winning.

The most important number in my mind is the average amount bet on each round. It’s a leading factor to revenue, but it tells you how much people are playing. The number of unique wallets is also somewhat interesting, and it can very easily be gamed, but there’s really not too much incentive to game it.

That’s something I’ve been paying attention to. From a data perspective, that’s kind of just what got me fired up: “All right, this is a new game to start unpacking and tearing into.”

How are the metrics—the number and amount of SOL bet per round—from yesterday until today?

There are $15,000-to-$20,000 rounds when the Motherlode, the jackpot, gets up to like $200,000 or $300,000. It’s crazy.

So, it’s a J-curve on how much people are betting when the jackpot goes up?

100%. That is the optimal thing to do. When it gets that big, you should be betting pretty aggressively.

Sorry, go ahead.

I was going to say, I think, if I had to guess, there are a lot of bots probably playing this game—bots on behalf of people—but that, again, is the optimal thing to do.

From the store-of-value perspective, that’s actually what you’d want. It’s burning ORE, which is keeping the supply intact. I don’t know. Again, the store-of-value stuff has always been goofy to me. Bitcoin’s got a fee problem. I’ve always been a fee truther. Ethereum wanted to go be the store of value, and that’s when it got extremely less interesting to me. That’s just not what gets me fired up.

When I look at ORE, why I like it is not really the store-of-value piece. It’s like, “Oh, this is a fun roulette game.” I’m intrigued.

There are a lot of people giving the M comp. I wasn’t even conscious when M happened. Do you know how that ended? Why that ended? Or do you not have a good take on that?

Honestly, I don’t have great line of sight into the similarities between the two. I think it’s mostly just the reflexivity, right? When ORE goes up, the games are worth more and there’s more betting. So, you should bet more, and therefore you burn more SOL—or you bet more, which burns more ORE because of the revenue buybacks.

I think that’s really it. I don’t remember the exact mechanism of M, but it was extremely reflexive in that nature. When the price goes up, everything gets better. The flip side of that is when the price goes down, everything gets worse.

It’s going to be really interesting to see how today shakes out. If it loses 50% of its value, there are still a decent number of people playing the game, which of course generates revenue, and that burns ORE and kind of keeps the game alive.

How does the data look so far today?

Pretty good. It’s not going to be a new all-time high in revenue, but it’s still somewhere in the $800,000 range, and yesterday’s all-time high was $1 million. So, not a huge drop-off, to be honest. It still looks pretty solid.

The revenue numbers are insane on this. This is the one thing where I’m like, “What the fuck?” I feel like I’ve just mid-curved the whole way because I was like, “Ah, it’s whatever.” The revenue numbers in this thing are insane, dude.

To be fair, I think it’s a pretty easy thing to mid-curve. We just ran through the entire ins and outs of this thing in, you know, 10 minutes. It is a pretty easy thing to mid-curve and write off as silly and stupid.

But I don’t know. I think meme coins are certainly not dead, but they’re kind of in a sophomore slump, if you will. People are probably looking for interesting ways to get that dopamine hit, and I feel like this is filling a void in that regard.

Do you think it’s still an interesting trade here? If you’ve been sidelined and you’re watching it here, is it one of these things that, as fast as it goes up, it goes down in a free fall and there’s no real way for it to recover? Or is this a thing where, if it bounces from where it is here and makes a new ATH on new ATH on revenue, it gets kind of disgusting, doesn’t it?

I’m definitely watching the chart all day. How do you think that plays out?

Yeah, I mean, full disclosure, I’m extremely long, and I bought more right before Frank decided to hit the sell button. I would’ve much preferred to buy at this price.

But, yeah, I think it’s interesting. I think today, tomorrow, and the following day are probably going to be the test, if you will. If people still play the game with a 50% reduction in price, that’s—it’s hard not to be excited by that, I think.

So, you’re a data guy. What is your philosophical take on these revenue-buyback coins? Do you think this is a better place that we’re headed toward with crypto companies, or do you think it’s one of these things where it’s good at low prices, but then you put a hard ceiling on how parabolic price action can go?

I’m kind of referring to hype, referring to ORE. I want to talk to you about Pump.fun a little bit. A lot of these coins—what’s your general stance there?

Yeah, it’s a really good question. I think, broadly, yes. But I think my general philosophy is it’s good to raise the floor.

It’s impossible not to look at the ZEC price action—and shout-out to Mert’s bull posting that got me early exposure there—and then just be like, “You need fundamentals for everything.” There are zero Zcash fundamentals. There are zero Bitcoin fundamentals. You have to acknowledge the presence of that.

But does that mean that, if I were going to go be an app founder, would I try to optimize for that? No, absolutely not.

I think the odds of having that outcome, where you hit that escape velocity and just don’t need fundamentals, are extremely low. Even if you look at the equity markets and the founders who have been the best at creating that cult-like group of stockholders that don’t care about fundamentals, it’s all driven by future fundamentals, right? When Elon gets up and talks about how they’re going to sell robots to the world, it’s because the end result of that is making a shit ton of money.

That’s always something that I think a lot of people in crypto miss. They want to tell this no-fundamental story without the “because it’s going to make a shit ton of money at some date in the future” kind of thing, right? Palantir has been really good about this, et cetera. I don’t know—that’s the other thing I think people forget about.

So, TL;DR, I think, yes, you’ve got to bring dollars in the door. Now, do you need to use all of that for buybacks? I’m generally against that. I think the Hyperliquid thing we saw a couple of weeks ago is actually a really interesting example, because the Assistance Fund does not hold USDC and only buys back HYPE, to the tune of 99% of revenue. There was no buffer to, let’s say, be the first one to prevent ADLs or something of this nature.

If you don’t use the revenue for buybacks, you can use it for anything else. Who are you prioritizing: the users and traders, or the token holders? The answer is you need to do both simultaneously, but to what capacity is a tough question to answer.

The Zcash one is interesting, because I’ve obviously been pretty public about being in that trade as well. I made a joke in a Telegram chat today. I was talking shit about meme coins and a lot of the ICM stuff in its current form, and I made a joke that I want philosophy coins.

Zcash is such a goated narrative because it has no revenue cap to stop how parabolic the price action can go, but then it has this philosophical ideology of privacy that you could meme every time there’s some headline. The UK announces a maximum holding of $20,000 for stablecoins. The UK announces that a digital ID is required to buy lettuce in the grocery store. The UK arrests a man for making a tweet.

What do you think?

And then you’re just like, “Zcash-coded.” It has this element of transcendent philosophy and ideology inherently involved in what the token is. When you really look at it objectively, it’s actually one of the best narratives you could ever create with a crypto coin. It’s hard to beat that one, because you can go left curve, right curve, every curve. You’re not capped by cash flows, and you’re not capped by “memecoins suck.”

It sits right there in the perfect mid-curve, which is interesting.

Completely agree with that. Would you put Bitcoin in that?

It’s hella Bitcoin-coded, bro. Bitcoin is so goated. Bitcoin is so goated, whereas ETH falls in the mid-curve. If we do revenue, ETH sucks. If we do TPS, ETH sucks. If we do popular apps, ETH kind of sucks. ETH is kind of bad in every metric that you look at objectively. It’s the complete opposite.

I don’t feel like getting yelled at by ETH maxis again, so no comment.

Yeah, it’s the opposite. It’s brutal.

Okay, I’ve got a question for you on the privacy thing. I feel like I’m going to get yelled at by Mert in my DMs after this, or Cnote, or someone. I completely agree with the privacy narrative. Privacy is a fundamental human right. The examples you gave are salient and matter a lot, and individuals should have privacy over their money. No doubt.

Where I get stuck is, if you make a tool that is good for foreign adversaries to create nuclear weapons, that’s bad. I think everyone can agree that’s bad. I’m not saying it’s happening with Zcash, but theoretically it could. North Korea, or whoever, could use that to move funds into their country and then do bad things. That’s where I get stuck, because yes, I want privacy over my cash. I want my friends and family to have privacy over their cash, but I also don’t want foreign adversaries and bad people to have the same tooling. I don’t know if you’ve thought about that.

I haven’t really thought about it that much. Maybe this is a bad take, but I think it’s one of those “it’s going to happen anyway” situations. I honestly don’t have a good take on it. I don’t really have a great take on it.

To be completely honest, I was not interested in Zcash at $50 four months ago. I’m totally—bro, as bullish and public as I’ve been about Zcash, I hold leverage on Hyperliquid. It’s hard for me to mansplain and act holier-than-thou about the privacy stuff when I hold it in a Hyperliquid account. You know what I mean?

As much as I would love to fight you on this one, I really don’t feel like I’m qualified to do so.

Yeah, okay. Totally fair. My exposure is in Coinbase, so I’m also with you there. I don’t know. That’s just—I don’t know. If anyone has thoughts on that, yell at me on Twitter. I’m actually super curious about this one, and I want to be convinced otherwise.

I think your point that it’s going to happen anyway is honestly true. Look at cash. People buy drugs and do horrible things in cash. So I think you’re right about that.

What? I love the Data Guys, by the way. We brought on Adam Tech recently.

Huge fan of Adam. I shot him a DM when I saw that announcement go live. He’s the man. That’s awesome. Huge fan.

Thank you. He’s awesome. I love the Data Guys because you guys are awesome. What else is intellectually interesting to you in crypto right now, outside of—or maybe outside of—the privacy stuff? Is there anything else you’re looking at where you’re like, “This is under-discussed. This is not being covered enough”?

There are two things that sit at the core of what DeFi is today: swapping and lending. I think both actually have really interesting pockets.

On the swapping side—the trading side—on-chain spot is quite interesting. RFQ, or request for quote, is really popular on the Ethereum side of things. On Solana, we’ve had a new on-chain iteration of that: prop AMMs.

Prop AMMs are basically on-chain market making, except not quite in an order book. Instead, a single market maker has their own book, right? From the aggregator perspective, you can hit Wintermute and name your favorite other market makers, but they’re all running their own books in separate instances.

It’s almost an order book. Solana has been trying to land the order-book implementation for quite some time. There’s actually a new one called Manifest that recently came online.

Prop AMMs are a quasi-order book where market makers can give much better quotes. HumidiFi is the largest prop AMM on Solana today. They did, I think, $2.4 billion of volume yesterday. That’s more than Uniswap and more than every spot DEX right now.

You can get a tighter spread—a lower fee, basically—on HumidiFi than on any centralized exchange. They have some of the best depth in the SOL/USDC pair. It’s a really cool innovation on the trading side of things.

What’s the trade there?

The liquidity.

They’re actually launching a token. If you want the hardcore answer—I feel bad saying this on stream, so take it with a massive grain of salt—it’s like on-chain Citadel, right? It’s on-chain market making. They’re launching a token and using Jupiter’s new token launchpad. They announced that the other day.

Whoa. You said “on-chain Citadel.” That’s what you just said?

Yeah, it’s a ridiculous claim, right? When Jito launched its token, it was like, all right, you’re going to have to take the Flashbots multiple, and you’re going to have to take the Flashbots not having a—I forget what this is called again.

HumidiFi.

Why have I never heard of it?

They have a hilarious Twitter. The token is so—HumidiFi is like “humid,” so the token is going to be—I think the joke they always have is, “You’ve got to get wet.”

That’s awesome. That’s great.

So, yeah, that’s been pretty interesting. Prop AMMs are super cool, doing a ton of volume, and now launching a token. We haven’t had a new DEX token in a while, it feels like, so that’s exciting.

On the lending side, the whole vault wars thing is super interesting to me. I don’t know if you saw—

Explain that.

Morpho. So, Morpho uses a modular lending structure where, basically, they're called curators, but effectively asset managers come in and say, “Deposit into our vault, and we're going to manage the allocation based on a specific strategy that's going to take X amount of risk.”

There was xUSDT or xUSD. I don't know a ton about it, but effectively, it was a quasi-stablecoin that depegged and went to zero because of mismanaged funds, and that took out a good amount of vaults that were in that trade. So it started like that; basically, it kickstarted this whole debate around what is the correct way to lend, right? Aave takes one approach, which is a shared instance and very strict listing procedures. Marc Zeller, ACI, Chaos Labs, and Llama Risk do a lot of work making sure they list the right assets to keep all the users safe.

That was kind of one style, and the other one is a permissionless system where any curator can come in and launch a vault. But the problem with that methodology is DeFi is great. It gives users freedom of choice to do whatever they want with their capital, but the biggest fault with that is it gives users freedom of choice. [laughter] It's kind of like the thing we were just talking about with privacy: privacy is great, but not if the wrong people use it.

The way you convey the amount of risk a user is taking within a specific vault honestly isn't that great today. If you were to give an asset manager and TradFi funds, you'd get a whole prospectus about the risks they're going to take, the guarantees you're going to get, and so on. Today, if you deposit in a vault, you get one sentence about the risks they're undertaking or the strategy that's being deployed. So I think on the modular lending side of things, we're going to need to see way better communication to users: “Hey, here's a strategy we're running.”

But my pessimistic take is that even if you do that to a sufficient degree and you do have a one-page prospectus, most people aren't going to read it.

Everyone clicks the vault with the highest yield, right? And that means you're taking the most risk. So how do you communicate to the user in a meaningful and sufficient way? It's a really hard question to answer. But my personal view is I don't think that's being done sufficiently today. I do think that is the endgame for lending architectures, and I think Morpho, Euler, and the others that are deploying that methodology are doing the right thing.

So what's your trade there on the lending architecture side?

Yeah. So Morpho is winning there. They don't have a fee switch activated today, and I don't love the valuation of the token. I think it's a little bit rich. It's somewhere north of $1 billion FDV.

A billion even.

Yeah. And that's not a small amount of money. So while I think they're deploying the right methodology, and the team is cracked—tons of respect for what they're doing—it's just a tough play. Spark is another interesting one there, with a little bit lower of a market cap. Potentially interesting. They're one of the largest curators on Morpho alongside Gauntlet, which obviously has no token, and Steakhouse, which obviously has no token.

I feel like a lot of this architectural side of DeFi and crypto goes largely uncovered by me, and a lot of the social side of it goes largely uncovered by a lot of people. Why? Is it just technical?

I think it's what we just touched on, right? There's not a lot of great ways to get exposure to it, which is the bigger problem. I think Euler was probably the best way to get exposure, and then the token had a huge summer. I don't know what it's trading at right now, but, yeah, it ran quite a bit in the summer. Maple doesn't really touch on this architecture, but has also been a strong player in the lending space. But again, it kind of already had its run, so everything's kind of breathing or consolidating at these new levels.

Someone in the chat said it doesn't have any sex appeal. You do a ton—

Yeah, I mean, lending is inherently boring, but if we go back to the HumidiFi side of things, just scroll through their tweets. They're definitely going for the sex appeal.

Yeah, I just followed them.

Nice.

What do you think about the state of onchain right now? You do a ton of the data stuff. We talked about Ore a little bit. I actually think onchain—and crypto in general—is in an interesting spot. All things considered, majors, or I guess Bitcoin, look solid. People have basically given up on memes, and it's a bloodbath on most memes. Most alts are a complete bloodbath, and then it kind of feels like most people are relatively flat, which gives opportunity for new, cool stuff to spawn.

Obviously, Ore, which we just talked about. I think some of the metadata stuff is relatively interesting—not the token so much as the things launching on it. The Avici thing is really cool; it ran to $40 million or $50 million. Obviously, there was Zcash. I feel like we're in this cool flat spot where it's hard for some of this stuff to get worse. Can people get less bearish on SOL memes? Probably not. I mean, I guess, but it becomes a margins game at that point.

When you're flat, I feel like there's a lot of room for stuff to go up and get exciting. I like to see stuff like Ore because even if people are like, “Oh, it's a Ponzi,” it's a well-dressed Ponzi, which is intellectually stimulating to a lot of sharp people. So you love to see that. You love to see Zcash. You love to see Avici. People are excited about some of the neobank stuff. I actually think onchain is in an interesting spot where there's a lot of room for new, cool stuff to come and basically create a spiritual reset around what currently exists and is being traded. What does the data say? What does your brain say?

Completely agree with your point, right? The last 2 weeks specifically have been super interesting. If you're holding Bitcoin, ETH, or SOL, you're down actually quite a bit. You're probably not the happiest. But if you're holding the Zora stack, you just had the best 2-week run you had all year, which is weird. If you told that to anybody in Q1 of this year, they'd be like, “Dude, shut the hell up. Stop.”

I agree. I think there's been this pause. It kind of feels like there's been a breath in the market, and the memecoins have again just kind of hit this weird homeostasis where they're launching the same number of tokens every day and generating the same amount of revenue every day. But I don't know, you and I aren't necessarily in the trenches like we probably were 6 months ago.

I agree with your framing that you have to find these weird pockets. Even Zora had its moment. There were the football cards on Base as well, not that long ago.

Yeah, I mean, that was one I didn't get my hands on, so I can't really comment on what it was. But it did also print a $1 million revenue day, if I remember correctly. That could be wrong, but I believe it did.

So there have been these weird pockets, and nothing has been super sticky, right? Zora has pulled back quite a bit in terms of activity, trading volume, and price. That football game was a week and a half, 2 weeks tops, and then TBD on the longevity of this ORE activity. But that's cooking with gas right now.

I agree. I feel like things have kind of flattened out. We're seeing it in the data. Trading volumes are largely arbitrage-driven across all chains at the moment. It's going to be interesting to see, with MegaETH and Monad coming online, whether that reignites the activity flywheel. Both of those ecosystems have had teams building on testnet for quite some time. Neither of them is going to launch bare, if you will. They're going to have things to do on day 1, which I think is definitely the right strategy in this day and age. I'm very curious to see if that reignites the activity games.

Can you give me a take on—I closed UNI, by the way. Nice little trade. So I'm down to talk shit about it now. Can you give me a take on why DEX coins fucking suck? Why is Jupiter cursed? I use it all the time. It's an incredible product. Why is Jupiter cursed? I don't get it.

It's a series of incredible products, no less, right? Like, they—

It's awesome. It's such a good product.

I don't know. So this is maybe less Jupiter-specific and more recent token launches-specific. These things keep launching at untenable valuations. If you launch—again, Morpho, for example—I don't necessarily want a $1 billion token when you need a lot of things to go right for that valuation to make sense.

I keep seeing DoubleZero. These projects don't necessarily have the ability to control the price they start at. You launch on a bunch of exchanges; they all have different rules for how they determine the starting price among the market makers. You don't have a ton of control over that. DoubleZero is going to be a very, very interesting product, but if it launches at, like, a $5 billion valuation or whatever it is, it's very hard for me to be like, “I'm super pumped about this. I want to go long.” I'll just watch from the sidelines. But if it does reinvent how packets are sent over the internet, it's probably worth $5 billion.

So I don't know. For me personally, I like the sub-$1 billion range. That's kind of my sweet spot.

I'm sure you read this—maybe you didn't—but Cobie had a really good back-and-forth about alt season and token valuations. I think it was in reference to Plasma initially, but it extends pretty broadly. There's really cool stuff that launches in crypto, but you don't necessarily get rewarded for being early in illiquid markets. I think this spreads across TradFi as well, and IPOs. There's really cool stuff that launches, but you don't necessarily get rewarded for being early in illiquid markets. Crypto actually generally punishes you for being early in illiquid markets. And I think the chart that I'm the most obsessed with right now is the Pump.fun chart, and it launches at a stupid valuation.

Day one, it goes up 30–40%. Pump was a little bit less—15–20%—because everybody’s just trading leverage on Hyperliquid, trading the momentum. It gets stupid. None of these people actually want to hold it, so they all sell when they’re green enough or they flip red. Everybody sells, and then we just cascade down 70–80%.

Plasma’s currently doing this, right? And then you sort of teeter for a little bit—one month, three months. TradFi takes three years, right? Robinhood was like three years; Coinbase, three years. And then you’re like, “Oh, wait. This is actually a sick company.” The valuation is actually awesome, down 80%. Then you ride an index back up to ATH.

I think that crypto—I think this is one of the reasons, or one of the friction points, for a traditional alt season: there’s a lot of cool stuff launched this last year, this last two years, but it all just launched at stupid valuations. Yeah, Zero is actually cool. He came on the stream, and I’m like, “This guy’s awesome. His idea is awesome. Cool, I’m going to long it on launch.” It’s the worst token ever.

There’s a lot of cool stuff that launched. Plasma is cool, but it launched at stupid valuations, and you can’t really justify the price. Sometimes, in a turbo bull, people don’t really care. But if you’re trying to hold these things long term, it does matter.

Once I digested the Pump.fun chart, you start looking at TradFi, and the same thing basically happens on IPOs. Look at the Figma chart right now. It looks horrible because there’s no price discovery happening in liquid markets, right? You’re not at seed or Series A. I think I’m just going to have to start thinking about what types of charts I like to trade a little differently.

I also think this is extremely MetaDAO-coded. A lot of what’s launching there—I actually kind of like the META token. I know you said you don’t like it, but it’s interesting to me. I’m extremely fascinated by what’s launching there. Avici is a great example. Profit was talking about how they might get a roofing-company rollup—a literal rollup of roofing companies—to launch an ownership coin. I literally tweeted, “I will be a 1% owner of this token.” That is awesome.

That is truly the internet capital markets thesis. It’s not just short-term crypto games or even long-term crypto games. It’s everything. I think that’s fascinating. It’s a testament to crypto if you can get someone building a roofing-company rollup—not a blockchain rollup; you roll up businesses—to launch an ownership coin. Maybe this is a really interesting way to raise capital. I’ll try to be a first mover here and take advantage of it.

The risk you run is, of course, adverse selection, but that’s no different from any venture bet, right? You can always bet on a shitty founder and lose money. I think there’s a little bit of MetaDAO coding here.

I also do like the Pump chart. I know I just said sub-$1 billion tokens are my sweet spot, but there are always exceptions. I’m intrigued by Pump for sure. They’re launching something this week. I don’t know the exact details, but their public GitHub has something called Mayhem Mode. There are very sparse details on what exactly Mayhem Mode is, but it sounds like mayhem. I’m in.

So I think MetaDAO—I actually had a long debate with someone today about MetaDAO because I’ve been so distracted with Zcash, I couldn’t think about anything else. Now I’m getting back into what’s going on. I saw Avici, and I’m like, “Fuck my life. This is cool. How did I miss this?” Then I’m like, “Okay, MetaDAO is actually interesting because they have sick launches.”

I think one of the things MetaDAO did right that Believe has done very wrong—and I don’t know if it was intentional from either direction—is that Believe was basically like, “Cool, we’re going to get Web2 credentialed people to come into crypto and launch. That’s what we’re going to focus on: non-crypto-native people coming to launch crypto coins.”

MetaDAO somehow found itself with crypto-native people launching crypto-native products for crypto natives, which the market has, in my opinion, said, “We like this more. We want to bid this more.”

My problem with MetaDAO is, one, correct me if I’m wrong, but they kind of have a broken buyback system. It’s not great. They’re not doing Pump.fun revenue numbers—not even close, not even in the remote ballpark. They kind of dropped the ball on that.

Second, I think they fucked up—or maybe they didn’t fuck up—but what makes MetaDAO cool and also holds it back a little bit is this futarchy thing. It’s sort of over-philosophical and esoteric, and it just—

Nerd-sniped.

It’s too nerd-sniping. I think it makes it difficult for some really serious people to say, “We’re going to bank our entire career on whether or not we can get DAO governance proposals passed.”

I think what it does is potentially set the stage for a Pump.fun rebrand to ICM, because what MetaDAO really did was have a sick BD team and say, “We’re going to get better products than Believe.” Believe just objectively—we can say what we want about Ben and the eco flywheel—they just had bad launches. They had launches nobody cared about. MetaDAO has launches people care about. I think it’s pretty binary: good launch, bad launch; token good, token bad.

I think it potentially sets the stage for Pump.fun, which has found a floor where, no matter what happens, they make $1 million a day, to come in here, basically be bottomed, and take a step back from this streamer-coin stuff, which has objectively been a failure. Maybe it works long term. I have a lot of takes on it; it’s a whole separate conversation. I potentially believe in it.

But it sets the stage for Pump.fun to rip an ICM coin to $50 million-plus, and then all of a sudden you’re like, “Holy shit, Pump.fun, baby.”

Yeah, I could see that. I could see that. I think Believe had two things wrong. One, I completely agree: poor launches, things nobody cared about, and the adverse-selection problem felt extremely real. A lot of these just seemed like exit scams.

In many ways, that was a walking MetaDAO advertisement, because the whole point of MetaDAO is, “We’re going to give you a token that actually gives you ownership and control over the entity,” as opposed to, “Yeah, this thing kind of looks similar to the product,” while having no relationship to the product on the Believe side.

If Pump goes more toward an ownership coin and less toward a memecoin associated with a product, I do think it can work. I actually think the whole ownership side of things is why MetaDAO is having so much success.

They had a cracked BD team. I also agree that futarchy can be a nerd-snipe, and we think it can work, but there’s a world where it doesn’t work. For reasons X, Y, and Z, maybe we don’t even know yet, it doesn’t solve the problems we want to solve. That’s a huge risk those founders are taking. I completely agree with that.

But I also think the big unlock there is that if the company goes rogue, you can recover the money you used to initially fund the business. I think that’s really interesting. It depends which direction Pump tries to go in the ICM route, but I agree: you kind of have to take the bet that Pump has an enormous war chest and that they’re going to use it to build and iterate on new product lines, with ICM very much being one of those.

That’s what I think about when trying to underwrite Pump: can they use that cash effectively to generate value for the token?

I like the take. I like the things that you like. I think you’re a really sharp guy, dude. I appreciate you staying a little longer than I had scheduled for. Is there anything you want to sign off with? Anything you were excited about that you wanted to say? Anything you want to chill? Any low-cap contract address you want to drop in the chat? What do you have? Anything to sign off with?

No. No. Yell at me on Twitter if you want to see cool data. That’s what we do at Blockworks. That’s what we love doing and that’s what we’re going to keep doing. So, if you ever have interesting things like, “Yo, I would love to know X, Y, and Z about this random app or thing that’s happening on-chain,” tweet at me. This goes to everyone, but also, Thread Guy, I appreciate you having me on, man. This was a ton of fun. It seems like we do like the same coins, which is fun.

I think we’ll run it back at some point in the future. I really enjoy you.

Yeah, dude. It’s been a pleasure.