欢乐六月怎么了？

And it reminded me of crypto. It reminded me specifically of FTX. We have the ability; we just don't have the willpower to go build these crazy things that FTX is building. It's a little bit like being an Italian living in the Roman Empire, looking around and saying, “We used to build some incredible things, Jonah. We used to have prediction markets, and then you could flip from one page to another and trade Bitcoin at 100x leverage. Then you could use the BMX token as collateral, and everything was fine.”

Somebody go out there and build that. Bybit's taking a stab. I respect Bybit for taking a stand.

Me too.

We are coming to you from a very interesting time. Right now, as we're speaking, there are a bunch of ballistic missiles being launched at all the U.S. bases in the Middle East. At least my group chats are freaking out, and everybody's talking about it. But do you know what's not freaking out, Jonah?

What's not freaking out, Avi?

The market is not freaking out. And actually, what's kind of interesting is that since that happened, oil has been on a tear ever since tensions started up in the beginning of June. We've gone up a sizable amount from bottom to top—about 26% on CL1—and equities have sort of gone sideways. It seems like the thing that got hit the most was actually Bitcoin and crypto in general. You see a lot of stuff out there that came off a decent amount.

1. Is The Market Fading Geopolitical Conflict?

So what do you think is going on? Are people scared of this war?

I think the crude oil market tells you pretty much everything you need to know about the war. There are a lot of tourists trading crypto on Iran headlines who don't really know what they're doing. Crude oil is a pretty efficient lens through which to view this whole conflict.

Over the weekend, some pretty crazy stuff happened. We had the United States of America basically entering—if you want to be alarmist about it, starting—a new war in the Middle East. If you want to take a more moderate tone on what they did, it was just a targeted strike using B-2 bombers against Iran's nuclear sites. That's kind of new. It's unprecedented.

Oil opened up above $80 a barrel, and it's been sinking all day. It's gone from—I don't know if this is real or not, but there was a wick up to $81.37. Let's just say the first real volume cleared at $80 a barrel, and it's now trading at $74.21. This is Brent, right? You want to look at Brent when you look at oil, not WTI, because WTI is West Texas crude. It's less bottlenecked than it used to be, but Brent is really the global waterborne benchmark that reacts to geopolitical stuff like this.

That's a $6 down day, down-only all day. You wouldn't expect that, as you said, if there were missiles flying from Iran at United States air bases. But the reason why I think this whole conflict is just a screaming fade, and why I think oil will continue to go lower from here, with some chop, of course, is because of what people are really worried about in the oil market and what we should be worried about as macro traders who trade crypto and equities. We're exposed to this conflict in a geopolitical sense, and we all share the same concern.

Oil traders, you, me—the concern is that Iran shuts the Strait of Hormuz. If they don't shut the Strait of Hormuz, this is a big “who cares?” It doesn't matter for this conflict. It doesn't impact anybody's bags other than maybe if you're long Iranian equities or something regionally relevant, like Israeli bonds. The thing that matters for the world is the Strait of Hormuz.

There's a lot of talk on Twitter: “Oh, they're going to shut it. Their parliament approved some measure that says they can shut it.” That's what everybody in our group chats is freaking out about. What these people don't realize, but what the oil market does realize, is that Iran couldn't shut the strait even if they wanted to—and they don't want to.

Let's go through both of those things very quickly. They're having trouble landing more than 5% of their shots fired on Israel right now. Most of them are getting intercepted—90% to 95% of them. That's just Israel. If they try to fire on the Strait of Hormuz, where you have about 3 aircraft carrier strike groups from the United States alone, Britain's got an aircraft carrier strike group there, and a bunch of other friendly nations are around with interceptor missiles, Saudi Arabia has THAAD batteries, and all this stuff, there will be more defensive firepower ready to intercept those missiles than if they fire on a random part of Israel, which is the size of New Jersey. The Strait of Hormuz is much smaller.

The second thing is, why would they do that? If you want your enemies to link arms with your friends, sing “Kumbaya” together, and bomb the living piss out of you until you're back in the Stone Age, the fastest way to do it is to shut the Strait of Hormuz.

The United States doesn't import any oil, or doesn't really have to. They'll import a little bit here and export a little bit there just to make the logistics easier, but net-net, they're not really an importer like they used to be. If you want to punish the United States, don't cut off the supply of oil from the Gulf. All you do then is destroy the economy of your friend and weapon supplier, China, and create a bunch of chaos that hurts your friends more than your foes. It makes no sense.

I don't think they want to do it. Even if they did, if they hit the first boat, it would be kinetic war so fast, and they would get taken out so quickly by an allied force of armies, from the United States to other Gulf countries that want maritime commerce through that strait, that it wouldn't last 24 hours.

I think you're 100% spot-on with that assessment. I'm not saying it from analyzing the oil market like you are. Everything that you said sounds very logical to me, and it sounds like Iran doesn't have the capability of shutting the Strait of Hormuz, and that it wouldn't really make sense to do so.

I come at it from a different angle as well, which is that basically, since the start of the conflict, Iran hasn't been able to do anything, let alone piss off a bunch of other countries by shutting the strait and shutting off oil. I think what's been proven is that this isn't really at risk of turning into a hot war, just because of how one-sided the conflict is.

They've basically managed to lob a few ballistic missiles at Israel, damage tens of buildings, and unfortunately kill 24 Israelis, but they haven't been able to inflict any real damage. If they were going to inflict any real damage, they would have done so by now, because Israel is striking them pretty hard. They're just losing across the board, and they continuously signal, “Hey, we want an off-ramp.”

The way that I view this entire conflict, basically from the beginning, is that it will be a nothingburger. This is not going to ignite a broader regional war. This is not going to send oil prices up another 25% or 30%. This is going to be something that probably, in a month, is effectively over and that we've all forgotten about.

It really does not seem like there's much they can do. The only way for Iran to escalate is to bring China and Russia into the fight, and they're not going to be able to. Putin actually got out there and said, “Hey, we here in Russia view Israel as a Russian-speaking country. 2 million out of the 10 million people in Israel speak Russian, and there are a bunch of ex-Soviets in there. We're not really interested in going against them. Obviously, we'll continue our relationship with Iran because it's a good strategic partner, but we're not interested in helping Iran go after Israel.”

China isn't interested either, and you can see that just from its actions. No one's really helped them out. Iran continuously goes to the press and keeps feeding them little tidbits to indicate that they don't actually want war and want to go back to the negotiating table.

2. Ads (Kraken OTC, Katana)

You saw those headlines 2 weeks ago—or 1 week ago—that said Iran was covertly trying to get back to the table. Even just now, on these specific ballistic missile strikes, news broke that they informed all of the army bases ahead of time that this attack was coming because they need to save face. But they know this is a losing war. They know there's really nothing they can do here.

3. What Happened To Joyful June?

So, my take on this is that the market did nothing. The market has gone sideways. We've had a few days in terms of talking about equities, so equities have gone sideways. There's not really much of a bid.

Now, Bitcoin has come off a lot, and I think Bitcoin has come off a lot because there was a reasonable amount of exuberance to get us to hit $110,000 or $112,000. We talked about this on the podcast. Basically, once we broke $102,000, there was a huge increase in open interest, and what that tells me is that the move from $102,000 to $110,000 was just driven by open interest.

So what happened was, when the equity markets stopped going up, there wasn't enough juice to really push the market higher. Now we enter a consolidation period. During a consolidation period, when you get periods of exuberance, money flows into the shitcoins. It flows into the Worldcoins of the world, and it flows into the Ethereums of the world. Those things tend to rally.

What did I keep telling everybody on the podcast? I said ETH/BTC up 30% to 50%, Worldcoin up 50% to 70%—amazing opportunities for shorts. I think I said Worldcoin was a great short at $1.20. It did go to $1.40, which you'd have to eat. Now it's at $0.82, right? Once these periods of exuberance end and then we trade sideways for a bit, these are going to be great shorts.

I'm of the opinion that ETH/BTC is going back to the lows. This is actually a very nice place to short it. You got a nice bounce off the lows here. You can probably look for another—I think you can reasonably stop out if it trades up 8% past that 0.024 level, but you can look for a trade down to the 0.019 level. That's a good risk-reward from my perspective because I think it's collapsing.

Basically, I think the entire altcoin complex is going to be in trouble, and I think all these things are going to be in trouble for one specific reason: I think we need a catalyst to really send BTC higher. I think BTC is very likely to range between $102,000 and $110,000 for the time being, potentially even lower.

Sometimes, when you get these periods of consolidation—basically, every time you get a period of consolidation at the highs—you do tend to have a pullback. I could even see Bitcoin get down to $92,000. Basically, I'm not super bullish on alts right here, right now. I think this is a great time to go short the shitcoins and look for accumulation zones on the stuff that we like.

This is going to be a period of opportunity, in my personal opinion, because we're in an in-between period.

Interesting. Yeah, we definitely know that alts bleed pretty hard and fast when Bitcoin ranges. But before we close the book on geopolitics, I guess there's one last comment I have on that before I address some of the things you just said, which I think are super interesting.

On geopolitics, the great thing for crypto traders is that none of you guys are trading oil, right? We're all trading crypto. To trade oil, you probably should work at an oil company; otherwise, you're not going to be very successful. Everybody's talking about oil and watching oil, and the great thing you can do as a crypto trader, since you don't have to trade oil, is just know that oil is going to lead crypto, right?

If oil rips, crypto will probably sell off shortly thereafter. If oil pukes, it tells you that the geopolitical risk factor that's been hammering crypto is subsiding a bit, and you can get a little more confident and comfortable, and maybe even greedy. Oil is just this great leading indicator. You don't have to sit there and get in the weeds and freak out about geopolitics yourself. The oil market is already telegraphing the wisdom of the smartest crowd that follows that particular set of news items and the risk factors involved for global markets, including crypto.

I don't think the crypto-oil correlation is so efficient and not laggy that you don't have a chance to get in and out of crypto looking at oil. If oil moves down for a couple of days, you could probably get a little more confident bidding Bitcoin. That's kind of my thought number one.

Just a quick footnote on that: The reason why the oil market rallied so hard on all of this Iran-Israel stuff was basically the way the oil market works. When fear prices in, it prices in gradually. People start buying oil futures as hedges for things. Equity traders will wake up and be like, “Crap, I've got a portfolio full of airline stocks. I have to buy some oil here.” People freak out slowly.

When it becomes clear that we're in a moment where it's topping out, you have to have some balls to short oil here. Let's say that you short oil and then you're wrong, and everybody else in the oil market is wrong, and they shut the Strait of Hormuz and succeed in shutting it for weeks. You're going to lose your job, maybe your life savings. It's going to be bad, right? Oil could go to $200, so there aren't really a lot of companies that can sell it.

Right now, you have a few brave souls with giant balance sheets and really stable careers shorting it, and most other people aren't. But after a few more days or maybe weeks of this, everybody who bought oil as a hedge or to try to participate if there was an outsized, fat-tailed move is just going to get out, and the oil market's going to dump right back down.

Then you can be damn sure that a couple of days later, crypto and equities are going to rally. There's actually a phrase for this in the oil market: “Escalator up, elevator down,” because you grind upwards as these geopolitical strikes factor into the market, and then, when the risk goes away, you just dump. It's just a big red candle all the way down.

“Escalator up, elevator down” is kind of where we are. We took the escalator up, and we're starting to take the elevator down. You can see it in the chart. We could be wrong. Oil could be wrong. Something crazy could happen. But people have been talking about this Polymarket thing: Will Iran shut the Strait? Polymarket says 60%.

Polymarket's definition of shutting the Strait of Hormuz is so vague that you and I could shut the Strait of Hormuz and trigger that market with a freaking Zodiac with a machine gun on it. It basically says they disrupt maritime traffic. It doesn't even specify a period of time. It's a joke. Polymarket's garbage. I wish there were a way to spin up a different prediction market on this, but your real prediction market is oil. So that's thing number one.

Thing number two is alt season, or reverse alt season, like ETH/BTC. Are we going back into this world where everybody who just accumulated a bunch of altcoins in the previous euphoric risk-on mode that ensued before the geopolitical stuff got scary is about to lose a bunch of money? Are we about to lose a bunch of money on our alts if we haven't already?

That's where I'm not sure I agree with you. I don't have a strong view, so I'm not going to try to say you're wrong and debate you on it, but I am expecting a pretty rapid finale to all of this. I expect lower commodity prices, economic certainty, and higher stocks.

Unlike previous times when we've had this sort of strong economic backdrop with diminishing geopolitical risks, this time the crypto fundamentals are looking—let's set aside all these weird vehicles that buy crypto assets, like MicroStrategy copycats. That's a little frothy and weird and scary. Aside from that, the Circle IPO is performing so well.

4. Why Is Circle Ripping?

And here's my issue with this, Jonah: People can't get enough crypto. TradFi can't get enough crypto. This is now reaching absurdity levels. For Circle's market cap to be getting at USDC's market cap is insane. That's ridiculous.

I have a trade for you. This is a trade. That's an utter sign of froth and bubble, but we're seeing weakness in the main asset. That tells me that we're close to some sort of pullback.

You see weakness in Bitcoin, but you see Circle trading at absurd valuations. It smells to me like we're getting closer to the end. This was very much a shift from what I was previously thinking, because I don't think the pullback in crypto, alts, Bitcoin—anything—has to do with geopolitics. I actually think geopolitics was a fun little issue for us to decipher, but it didn't move the equity markets, or it barely moved the equity markets. I don't think it's the reason for ETH trading down 25%. It just doesn't really smell right.

Well, basically, what it said is, “Oh my God, we're in full-force euphoria. Let's just send the market up as rapidly as possible. Let's just buy things hand over fist because we can't think of any risk vectors.” And then geopolitics comes out—the Iran war comes out—and everyone's like, “Okay, hold on. Let's just cut the euphoria for a little bit. Let's just trade reasonably.” So then the market goes sideways, but crypto was already in sort of this mini bubble, and so it comes off a lot. I don't necessarily see us immediately sending back into a euphoria phase. I think you need a little bit of a cool-off phase before doing that.

To argue against that, maybe we've had that cool-off phase because we've been trading sideways since early May. But what I've seen in the past is you tend to get longer periods of sideways trading. Once we hit the peak in March of 2024, we went sideways for more than 6 months. The most recent period of sideways was November to February, in which we ended up trading lower. That was a substantial period of time. We've only had a little bit more than a month of trading sideways here, so I think we can digest a little bit before the next leg up.

During those digestion periods, the stuff that isn't actually good tends to come down a lot, which is why I like the idea of buying Bitcoin on days where there are liquidations, like yesterday, and shorting alts and maybe shorting ETH/BTC. That's sort of my trade right here. I think it's a reasonably good time to continue pressing a trade that's actually worked reasonably well over the last 1–2 weeks.

Yeah, that's fair. I like that. Do you think we immediately jump back into euphoria here? Do you think, all right, we bottomed, and now Bitcoin's just going to send straight to the high heavens? Or do you think that we need a little period to digest?

No, I mean, you're right. We need to digest this. So I guess if you're like me, trying to pick a point to add risk and DCA into more crypto, it's probably not right this second. I agree with you. Can we talk about Circle?

That's what I was about to talk about. How do we make money on this thing? This is so clearly massively overvalued, but I was looking at options today, and the IV is just unbelievable.

You can do 1 of 2 things. You can sell calls, which takes some balls, or here's an idea for you, Avi: buy Coinbase stock, short Circle stock, notional neutral. What do you think of that trade? That's the one I wanted to run by you and pitch you.

I'd say it again: buy Coinbase, short Circle. So, long Coinbase, short Circle—a pair trade. Long Coinbase, short Circle. I like that Coinbase's market cap is okay. Long HOOD—just basically long a real crypto company, short a hyperinflated crypto company.

If crypto goes up, you don't want to be short Circle outright because that's dangerous if Bitcoin goes to $150K on some sort of euphoric trade. You want to be invested in something that'll help you participate, or long Bitcoin, short Circle. I think long Bitcoin, short Circle is a great trade. But I do agree with the framing. Why are people buying Circle? I think TradFi can't get enough crypto. It can't get enough stablecoins. I think they need to go long XPL, Plasma, and short Circle. That's tougher to do, but also XPL is less liquid.

I just think, honestly, Coinbase is Circle. Coinbase is the biggest recipient of Circle money, right? If people need more USDC, most of that dough goes to Coinbase. I think what's going to happen is either we range sideways and Circle comes back down to earth, or risk assets, including crypto, keep ripping and then rates get cut. I think the most hilarious situation would be rates get cut, everything rips except Circle, because Circle's so exposed to interest rates.

Dude, these calls are—let me just, I want you to take a guess. Circle is currently trading at $270. The $350 call on the August expiry, August 1—what do you think it trades at in dollar amount?

Okay. If I had to guess the dollar amount of that, I haven't looked at the options chain or anything. August 1 is a month and a week away. Oh man, that's going to be like $70, $90.

It's $34.

Okay, but still, that's pretty rich.

Yeah, it's pretty freaking rich. I was going crazy, but no, that's insane. I mean, the $350 call for July 3, which is a week away, is $15. The yield on that is just kind of unbelievable.

Sorry, what did you say the strike was of this call?

$350, and it's $270 right now.

All right, so I made a really stupid mistake. I thought you said $450. You can't have a—who would pay $90 for something that's less than $90 out of the money?

Yeah, that would be a little insane. I hear you. I think $35 is a pretty crazy price. The $350 call for July 3, which is a week away, is $15. The yield on that is just kind of unbelievable.

Still, it's hard to sell after what the thing just 10x'd, right?

Yeah, but that's probably the best time to sell these calls.

You could have made that argument $100 ago, though.

I don't know about that. The reason that I'm making this argument now is specifically because, first of all, we're now at a truly unbelievable market cap—crossing USDC in terms of market cap—which just makes absolutely no sense. I think that is kind of what it takes to wake people up to, wait a second, this is an insane trade. You sort of hit a number that everyone goes, “Wait a second, it's worth more than the market cap of the thing that it's making 2% on.”

Maybe that's the way you reduce your crypto exposure if you're worried about chop: you just keep your crypto portfolio intact and sell some Circle calls or short some Circle stock. It will go up if crypto rips. If Bitcoin trades to $130K right now, Circle is not going down. It's correlated with the broader space, I would think.

Yeah, I would agree with that.

I do think that's probably a reasonably good trade, Jonah. Buy some Bitcoin. Maybe you can buy half Bitcoin, half COIN, and short some Circle.

Yeah, Coinbase is still rock solid, I think.

5. Ads (Kraken OTC, Katana)

Yeah, I was very skeptical about them because they were coming out with all these hacks and losing customer deposits. To be completely honest, the UI kind of sucks, but they just keep trucking along.

6. Crypto’s IPO Frenzy

You know what I'm really excited for? I do think that the next major IPO is going to tell us a lot about the state of the market. I'm hopeful that Ripple can pull something off this year, as a holder of some shares. I do think that, like I was saying on the last pod, this is the new ICO. This is how people are now making their money. It's great if you can get in on the ground floor, but I do think it ends in tears at some point.

Man, Ripple is another one. Think of who's buying Circle here and how much money they're going to lose. It's probably some poor retail person just bidding it because they think it's the best way to get exposure to stablecoins. Honestly, these are signs of froth that should be worrisome to us, but I just don't see the froth in the Bitcoin market.

So, I'm not worried about that. Funding looks fine. Altcoins have just traded off 50%. I'm not seeing any signs of froth in the token markets yet. It's these weird equity plays.

Ripple must be racing to do an IPO right now, watching what's happening with Circle. This is the most insane, mania-driven moment I've seen in the equities market since—I'm trying to think—maybe there was a cloud-security startup moment for IPOs. But really, this feels a lot like 1999, except for crypto companies like Circle. They earn $18 million a year in EBITDA. Ripple—no one can tell me what they actually do. I don't know what Ripple does. Do you know what Ripple does?

But they're worth so much.

I mean, yeah, they sell Ripple. Yeah, so this is a great time for that thing.

But here's sort of what I'm talking about. I don't know if you saw the news that there are a bunch of hedge fund veterans—this is the CoinDesk article. It's funny because I'll share the names: former Coral Capital Holdings executives Patrick Horsman, Joshua Kruger, and Jonathan Pass. “Former hedge fund veterans” means they ran a crypto hedge fund that nobody's ever heard of. They plan to raise $100 million to buy Binance's BNB token through a Nasdaq-listed shell company.

This is the trade. I'm getting hit day after day with people saying, “Hey, I got this idea. We have this shell company that failed its FDA trials, and we bought it for a million bucks, so now we have a public company. We're going to turn it into a treasury. Do you want to buy in? Do you want to help us out?” I've gotten this pitch a lot, and I've said no to every single one so far. No one in my friend group has pitched me that, Avi.

That's hilarious. Yeah, I'm getting this pitch all the time. It's crazy.

Sorry, go on.

One of the reasons I'm saying no is because I do think it's a little predatory. I'm probably not going to get many offers after going on this podcast and saying that I think it's a little bit predatory. But I do think that a lot of them are going to do very well from the get-go because there's clearly a lot of demand. What I'm starting to realize is that there are actually not a lot of people in crypto who are paying attention to this—your average crypto person. They're still in the memecoin world.

What I would do if I were an average crypto investor right now and didn't have a ton of capital is look at all these listings and try to buy them on day one and flip them on day two, because that seems to be working pretty well so far. Buying these treasury companies, I think, will work for the next—I don't know—maybe 3 months, 5 months, who knows. But keep doing it until it stops working, basically. Stop looking on DEX Screener for new token launches. Go screen for what's going on. Go read these articles. Try to figure out who's doing what and how you can buy on day one, because I do think people can make some good money doing this. Another way of doing it is just to email these people and ask to get in. I feel like that may work.

I just don't understand the dynamics of this trade. Who's buying them on day one? Who's buying them on day two? Who's buying them on day 30? I don't understand the flows.

For example, for this one—which, again, I have no ties to and I'm not a part of—I think it is a compelling pitch specifically because people don't have access to investing in BNB. Your average person doesn't see a way to get ownership in Binance, even though it's by far and away the largest cryptocurrency exchange and makes money hand over fist. If you're an institution, you don't own any Binance. You don't own any stock. You don't own any BNB because you can't. So who's tokenizing the stuff that traditional institutions might want to own, or somebody in a 401(k) might want to own, or some wealth advisers would say, “Yeah, own a piece of Binance,” right?

See, to me, this seems backwards. The whole point of crypto is to tokenize equities, which are sort of inefficient. They trade from 9:30 to 4:30 and are kind of unavailable to most people in the world. You bring them on-chain, and they trade 24/7, 365 days a year. A farmer in Chad has just as little friction buying IBM stock as a TradFi investor in the United States of America. That's the promise of crypto. That's what it's supposed to be doing.

It's hilarious that the exact opposite is happening, right? You have BNB, an extremely liquid token, with incredible depth in the stack, and you have these people saying, “Oh, BNB—the token isn't available to institutional U.S. investors, so I'm going to reverse the process I just described and list it on a stock exchange via a shell company, with probably tons of management fees and hidden stuff. Then it's going to become kind of a pump-and-dump structure that'll undoubtedly be abandoned after 6 months or a year.” It's kind of funny that this is going on. It feels a little bit skeevy to me. That's probably why you said you're not getting involved, right?

It's sort of the opposite, but in the same way that I'm not going to take allocations from Pump.fun tokens, I'm going to sit here on this podcast and tell you that a year ago, when they were going ham, “Hey, it's probably a good way to make some money.”

Oh, yeah. No, I wasn't saying it's not a good way to make money. That's sort of my take here. I've made enough money in my life that I don't feel the need to make money like this. However, I can tell you it's probably a good way to make some money if you want to sit there and try to flip them.

Yeah, I mean, look, the money from flipping these things is as green as money made doing anything else, right? So I agree with you: it's probably a good way to make some money. What I don't understand about this market—one of my trading philosophies is don't try to make money trading things you don't understand, or have a very limited understanding of.

With memecoins, it kind of clicked for me. It's literally just a pyramid scheme. You're passing money. It's hot potato. It's musical chairs. It's a game we've all played before, and you just don't want to be the last one caught holding the bag. If you get in early, it's better, and if the meme is more viral or has more virality to it, that's better because it means more eyeballs will be on it and there's a higher likelihood that somebody else gets caught holding the bag, giving you time to get out.

Here, having no idea who the participant base is, I would feel less personally confident. The reason I did occasionally dabble in memecoins and why I won't dabble in this is because if something is as opaque to me as this, it's still just a pyramid scheme. It's a hot-potato game or musical chairs, whatever you want to call it, but you don't know how long people are going to be getting in. It's hard to assess the virality either with your head or your gut. It's also hard to know how these people think and when they get out.

Unless you're really getting in on day one—which I think has a lot of convexity to it—I agree with you. It would be very dangerous to play in this game. With the memecoin stuff, if you want to analyze what the other investors are doing, just look in the mirror, right? If you're feeling FOMO, if you're feeling like BODEN is going to go to a $60 billion FDV, that's probably what everybody else is thinking too, which means it's time to get out, right? And vice versa.

With these things, I would say there are 2 pieces of advice. Number 1: don't feel shy about missing a trade you don't understand, because more often than not, when you dabble in things—when you put money into things that you don't understand—you just lose it. Number 2: if you're not in on day one, it's probably already too late. Day one, when they launch whatever freaking vehicle—to your point, you don't want to be in on day two. You want to be out on day two. This is super risky, these treasury things.

7. Will Treasury Companies Unwind?

But let's say all these treasury stocks one day just start vomiting, which is obviously going to happen. Is that going to be bad for our Bitcoin bags or just bad for our altcoin bags? Will it be contained, or will it be systemic for crypto?

It's a good question. I think it would definitely bring down the broader market. What would happen is people would start worrying: what's the OG treasury stock? It's MicroStrategy, right? So when you have the rest of the market puking, I think then there become fears about, okay, well, if MicroStrategy starts puking, what does that bring with it?

The answer is nothing until 2027, as far as I'm aware. However, I do think it causes some fear in the market, which is why, again, I get nervous when I see things like Circle, which I looked up trading at a $64 billion market cap.

I get nervous because I think that represents a decent amount of money that got pushed into this thing. If it kind of crashes across the board, then I think you’re in trouble.

It’s basically flat for at least the short term, but I don’t think that it’s long term. I think it’s probably a week-long sell-off in that particular case because I don’t think that there’s a lot of cross-asset holding across these. I don’t think there are people who, if their Circle is down, are going to sell a ton of Bitcoin. It would mostly be smart money trying to trade it effectively, which I think would be over in a few days to a week. That’s assuming, of course, it doesn’t go down for some marketwide reason.

Yeah, we’re sort of assuming all else is being held equal.

Correct, dude. This is Circle at $67 billion. Coinbase’s market cap is $77 billion. So, if you bought Coinbase and sold Circle, you’d basically be doing it at almost a flat market cap. What’s $10 billion between friends?

Coinbase’s EBITDA is close to $1 billion. They’re a custody solution, an exchange, and an L2. Coinbase is a real business. Circle is literally just a funding arb. I don’t get it. I don’t get it.

Avi, this is crazy. I feel like the only way to make money on Circle is to short it and be long something else in case crypto rips while you’re short. But how are you going to short this thing effectively?

I don’t know. I would just want to sell calls on this thing, to be completely honest.

Yeah, probably a quick way to make $35 a share.

8. Is Tokenization Real?

Yeah. You don’t have enough shares of Circle for the collateral needed to place these orders. Robinhood is only making you use covered calls. I think it might require these calls to be covered.

Oh, man, that’s no fun. So I guess I could buy puts—already-in-the-money puts.

If only we could do this. If only we were foreigners who could trade on Hyperliquid and these stocks were tokenized.

I mean, that would be pretty easy. Trading on TradFi platforms is just such a horrendous pain in the ass compared to trading on crypto-native platforms. They’ve really optimized the experience for the user.

Yeah, it’s truly amazing. I can’t wait for that to be the case, when you can just trade everything on HYPE.

One thing that was fun is Bybit messaged me and said, “Hey, just so you know, we’re launching all sorts of commodities on Bybit.” I think that’s probably the first step. You’re going to see people try to step up.

I’m still in Italy, actually. I’ve been in Italy for almost 2 weeks now.

At first, people think you’re Italian.

Oh, yeah. They speak to you in Italian. Anywhere I go where the people are slightly brown, they just think I am Italian, so they’ll speak to me in their language. I’m in Sicily right now, which makes people think, “Wow, yeah, okay, this guy’s definitely Sicilian. Look at this coloring.”

I’m not. I don’t speak any Italian. I don’t think I ever will. But I was in Rome for the first 4 days of the trip, walking around and thinking to myself, “It’s crazy how Italy is now a poor country, but you’re surrounded by these amazing structures that you can’t even build today because you don’t have the political willpower.”

You have the ability to do it, but you just know it’s not going to happen. There’s no way you’re going to do this because it would cost too much money. It’s not like we lost the ability.

It reminded me of crypto. It reminded me specifically of FTX. We had the ability—we have the ability—but we just don’t have the willpower to go build these crazy things that FTX was building. It’s a little bit like being an Italian living in the Roman Empire, looking around and saying, “We used to build some incredible things.”

Jonah, we used to have 3x-levered tokens for every asset under the sun. We used to have prediction markets, and then you could flip from one page to another and trade Bitcoin at 100x leverage. You could use BMX as collateral, and everything was fine. We had 100% APY yield on your USDC. Exchanges that won’t actually build what we need them to build.

Somebody go out there and build that.

Bybit’s taking a stab. I respect Bybit for taking a stab, too. Respect Bybit. Respect Hyperliquid.

I think tokenized commodities are really necessary. Equities are—I don’t know how hard it is to trade U.S. equities if you’re offshore. It’s probably pretty tough, so maybe tokenized stocks are important, too, for some people.

But I think tokenized commodities are the real grand slam. When somebody can eventually bring perpetual futures to markets like crude oil and break the monopoly or duopoly that ICE and CME have, I think that’ll be huge, huge, huge, huge for retail investment in commodities. Until then, who cares?

9. Tron Is Going Public

Should we talk about Tron going public? That’s another one where I saw the news and I don’t know if I was hallucinating or not, but I feel like Tron has gone from this pariah chain to being about to go public. I think that one might be another crazy rumor.

Let’s just stop you for a second. Do you know what it means for Tron to go public?

Tell me, Avi.

Answer the question, Jonah. When we talk about Tron going public, what do we mean?

The token? What the fuck? What is going public? I’m genuinely asking you this question. What is going public?

I don’t know. But I guess my question in response to your question is: Does it even matter? It’s a crypto IPO, and Circle just went ballistic. So maybe it just rallies for no reason.

Honestly, it feels like investing in Pets.com in 1999. SRM Entertainment is the one that’s quote-unquote going public. It rallied 650%, it looks like, since the announcement, which is pretty crazy.

Well, I guess—well, well done, SRM Entertainment, for doing this. We just have to, if you’re out there and you’re thinking, “How do I make money?” start cold-calling penny stocks. Start cold-calling the owners of penny-stock companies and being like, “Listen, buddy, do I have the deal of a lifetime for you? Have you heard of ‘Buy Some, Go Public’?”

Yeah. This is seriously like The Wolf of Wall Street or Boiler Room. This is the J.T. Marlin Securities of our time.

I’m not dabbling in any of this. I just want to point this out: You could have bought this thing at the announcement and pumped it 50% after the announcement, and there’s a delay of about an hour.

That’s what I’m trying to explain. There are all these random trades you can make because it seems like people don’t necessarily have a good filtering mechanism or a way to ingest when something like this happens immediately. If you can generate that framework, you can probably make a decent amount of money on this.

10. How To Trade This Market

Obviously, the better way to do it would just be to be in the know. I’m not in the know. Justin Sun did not tell me he was doing this. Shame on you, Justin. You should have called me. Why did you not call me?

Yeah. Honestly, at this point, I’m a little bit confused. The broader question is: How do you make money over the next 3 months? Do you A, hold Bitcoin; B, try to cycle through—

Well, HYPE has been doing really well, Jonah.

Yeah, I’m getting to that. Okay. So, B, cycle through these publicly traded treasury companies using the strategy we discussed before on the podcast, which is get in early and get out slightly less early; or C, do you trade altcoins?

It feels like the consensus that’s appearing on Twitter is to hold Bitcoin and HYPE. Those are the golden bags for the next leg of this bull run.

HYPE has been trading Teflon throughout this whole thing, and SYRUP’s been hanging in there. Worldcoin’s been going down. My portfolio is looking pretty good, actually, Jonah.

Yeah, so is mine. I like Hyperliquid. I think maybe simpler is better. There are all sorts of ways to play it. Maybe take 5% of your portfolio and screw around with these treasury companies just to learn something, or try to sell some Circle calls.

But I just don’t know. I think the odds are so much better in Bitcoin and Hyperliquid. The only problem with that trade is that it’s totally consensus. But it’s such a good trade.

It’s consensus for now. But, I mean, the first one—when is the Hyperliquid treasury company going to be coming soon?

When’s the Hyperliquid IPO?

Hopefully never, Jonah. May the odds ever be in your favor, right? That’s what they say.

Same to you. Buonasera, Avi.

Buonasera.

Buonasera. You know, you’ve got that face like you could be—like, you know how in 1990s action movies they would just cast kind of nondescript bad guys? You couldn’t quite pin what race or nationality they were, like Anton Chigurh.

Who?

The guy from No Country for Old Men.

Oh, yeah. Yeah, it’s a great movie.

Anyway, have fun being Italian for another few days. I will enjoy it. Adios.