How a Crypto Pro Uses AI

0:06Kris Bullock:Hi, everyone, and welcome back to another edition of Trading the Markets with AI, joined by Kris Bullock, a.k.a. BlastoPlast. And today we have a special guest joining us for the entire show. Jamie Coutts will be joining us and he'll also be going over and breaking down how he's been building with AI. But today on the show, we're going to be talking about how OpenAI is building a smartphone to kill the app economy. Anthropic crosses$1 trillion in implied valuation. It's still private, though. Goldman Sachs released a report that AI could be a long-term earnings destroyer for incumbents. There's a battle going on as well within the AI frontier between Elon Musk and Sam Altman.

0:57Kris Bullock:open AI, Musk and open AI trial just kicked off this week. So we'll talk about that as well. And Google signs a classified AI deal with the Pentagon. And speaking of the Pentagon, is Anthropic back in play with government contracts? We're going to discuss it all. And of course, as I said at the top of the show, Jamie is going to be talking to us in the second half of the show about what he's building with AI. Gentlemen, how are you doing? Thanks for joining us. How's everyone?

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2:32Bijan Maleki:Doing great. Happy to be here. Looking forward to this.

2:36Kris Bullock:Yeah, absolutely. This is a thrill. Thanks for having me on, guys. Yeah, of course. So, I mean, guys, I'm a broken record. I say this every week. It's like it's a New stories, new narratives, everything new is trending within AI and new week. Obviously, the same story with that because we have new stuff just happening left and right. And well, ChatGPT is on a roll right now. They recently released ChatGPT 5.5 or sorry, OpenAI is on a roll right now. They recently released ChatGPT 5.5. They released ChatGPT 2.0 or the Image 2.0 version as well, which is insane. I've been playing around with it.

3:20Kris Bullock:And now this story just hits today that they're working on a phone to replace AI agents. Chris, are you going to be a buyer of this phone when it comes out? What are you thinking here?

3:37Bijan Maleki:I mean, I don't know. It's funny. I'm such like a Google nerd. All my stuff is Google. I've had Pixel phones for eight years. You know, I'm like my third iteration of a Pixel phone. So I don't know. I'm not going to be the first one to jump ship on that and get on this. But it is fascinating. I was reading this article and a couple of things that stood out to me. One, they're not going to be focused on apps because they won't have the pipeline of the Google Store or the Apple Play Store. They'll have to. It's going to be completely independent. and it's essentially going to be an AI agent running on this phone.

4:13Bijan Maleki:So instead of having an app for everything, an app for this, an app for that, you'll just be like talking to your phone like it's a chatbot and it'll just sort of do all the stuff that all these independent apps can do. And that's a very novel approach, I think. And I think there's something to that. And I think the fact, too, that they've got, you know, how many, what does this say, a billion, nearing a billion weekly users, there's going to be a market for that. And it could be, you know, a precursor, a sign of things to come for the future of, you know, mobile phones. And it could be too, you know, we could see the likes of Google say, hey, this is a thing.

4:48Bijan Maleki:Maybe the next Pixel phone is going to be like this too, you know. And so it'll be interesting. I'm curious to see. But I like the idea. I like where they're going with it. It's novel, you know.

5:00Kris Bullock:Yeah, no, absolutely. I mean, Google has an interesting advantage with it because they obviously operating their own with Gemini and then they have their own phones as well. So that's just an easy implementation into it.

5:12Bijan Maleki:They've got a full tech stack already. They can just they could do that tomorrow if they want to.

5:16Kris Bullock:They could, yeah. And I think anyone who's working with AI agents also knows like how I'm working with AI agents right now. I have an open clock. I feel like I don't really need an app or any apps really, because if I do want an app, I can just have it create one for me that's personalized to me. So like, I feel like these agent phones can just be spinning up apps left and right that are just for you. And you don't really need to go on the app store and figure that out. You think of it, just tell your agent to create an app and in like 10 minutes, it's on your phone and you're using it. So that could be an interesting thing.

5:52Kris Bullock:Jamie, are you a buyer of this phone? What do you think? No, I'm not a buyer of an open AI phone, but it definitely looks like the natural progression of the technology, right? So, you know, it's been sitting, first it was sitting as a chat box on our, essentially for most people on their desktops. Then it starts getting integrated into our chat, you know, applications. I use it in Telegram. I'm about to set it up in WhatsApp. so most of that sort of activity takes place on the phone, right? Like these really started as mobile apps that obviously have a desktop presence. So it makes sense that they move into this part of the consumer market.

6:37And OpenAI is so consumer-focused, right, whereas Anthropic has been targeting the enterprise. So it does look like just that natural progression and it's very much, I think, a swipe at Google. and Google has everything in place. I mean, it has the phone infrastructure. It has the supply chain. So for it to transform the Pixel phones, Chris, and I use one too, I became totally phone agnostic about five years ago, even though I loved Apple, just with the prices that they were charging. So by now I'm open to any offer from any phone company if it's a good product. But like, yeah, I mean, I wouldn't be surprised if Google has a response to this within sort of six months.

7:24Kris Bullock:Yeah, no, it makes sense. They're definitely, like we were saying, positioned to do so. Speaking of Anthropic, Jamie, that's a perfect segue into our next article. Because, I mean, listen, if focusing at the enterprise level, it definitely pays from Anthropic's point of view because they just hit a trillion dollar valuation in private trading. I think they're one of only like very few companies to ever hit this mark. So they're definitely in like in rare company with that. No surprise as well with like just the power of what Anthropic has. There's the amount of products and updates they've been releasing in the past month.

8:11Kris Bullock:It was like there was a point where literally every day there was a new product release coming out of Anthropic or a new update to Opus or whatever it was. So it's no surprise to me, at least with all of the news going on with AI, all of the investment into the to these to the picks and shovels surrounding AI, that one of the premier LLMs and AI companies would reach this evaluation. Right. Chris, do you think do you think it's not high enough still or do you or do you think it's just right?

8:43Bijan Maleki:I don't know how to answer that. I don't know how to answer that. But it's one of the things that stood out to me in this article, speaking of that, is the fact that, you know, the old way of valuing companies is sort of going away. And there's these new, you know, secondary venues, like it talks about in this article, it mentions Forge and Hive and even Jupiter, the, you know, the on-chain decks, the Solana decks, they're now sort of pricing in private equity in real time, basically, and generally pretty well converged, you know, with one another. And so that's interesting, the sort of new model of valuing private companies.

9:20Bijan Maleki:And then once again, I, you know, I feel like we talk about this every week, but we're seeing these, the public market being completely bypassed by these massive valuations, you know, these companies with trillion dollar valuations that are established before the company is even public. So it just, the way capital is is generated now is, is like completely different or we're going through this massive change in that regard. But, but yeah, no, getting back to the real-time price discovery, I think that that's a key thing in this. And, um, that's to me, the big takeaway is sort of seeing how these other third-party secondary venues rather, um, generate these valuations.

9:57Bijan Maleki:And it makes me want to dig into what's going on over there with these platforms with Forge and Hive. And, and I didn't know Jupiter, you could, you could do this with private equity on Jupiter. I didn't even know there was a thing, you know, until I read this. So really interesting to see that that's how these companies are being valued. It's like a poly market for private equity valuations, you know, for company valuations and things like that. So yeah, just the whole financial world is changing so rapidly, just right before our eyes, like every day, you know, it's so wild.

10:28Kris Bullock:That's an interesting point, because right when in the past, companies like this coming out wouldn't have had a 24-7 market that you can place bets on, investments on, speculate on that we have now. I wonder if that obviously helped to get to where it is. Jamie, what is your take on Anthrop? Are you using Anthropic quite a bit or Claude and stuff? Are you in Gemini, ChatGPT? What's your take on all of this? I'm pretty much in the Anthropic silo. uh like i try to use the other models and you know for very general things i started off with like chat gpt like most people um but moved across maybe like six months ago when that big step change happened in like q3 of last year um so yeah like what i find interesting about this a little anecdote is that i remember when i was uh in singapore on a sell side desk and there were markets being made in Facebook, right?

11:31Pre-IPO 2010, 2011. And I think Barry Silbert had his start really in creating like secondary markets for private equity. And so now it's obviously evolved and you can trade these things on blockchains as well, which is pretty exciting and a great way to access, I guess, the volatility and speculation of these massive, massive looming IPOs, right? Because they're going to exit through the public markets eventually. That's the thing that I am starting to really think about a lot more. You've got SpaceX, you've got Anthropic, you've got OpenAI, all scheduled for the second half of this year. Mass evaluations.

12:22situations and from what i can from from what i've read with they're actually tweaking even um the the index inclusion rules to include like spacex from the get-go so i guess what i'm sort of focusing on more is what is the impact it will have on public markets when there is a lot of liquidity that needs to be rotated into these massive ipos that are going to be um you know some of them are going to be immediately included into indices, which I think is a significant change to the way that the index inclusion rules actually work. That's all scheduled for later, you know, later on in this year.

13:02Kris Bullock:Now, I'm actually glad you mentioned that. Why don't we go ahead and talk about that? Because it kind of alludes to our next, one of our next stories here with Goldman. And they released that study that shows AI fears making investors rethink long-term US equity value. So basically Goldman Sachs published a research showing that AI disruption fears are pushing investors to reassess how much of US stock valuations depend on profits expected beyond the next decade. So the concern really isn't just about AI costs, but about AI essentially compressing long-term corporate earnings across entire sectors.

13:41Kris Bullock:So obviously this is like a real risk that people are thinking about now. Right. And, and Jamie, that's something I think you're, you're like, you just alluded to that you're definitely thinking about. How do you guys view this? Yeah. So this is the, this is the other side of the equation. Like we're talking about like how to value these, these, you know, the LLM or the frontier model companies and some of the other companies associated with the, you know, the development of those models, that's one-sided. But then you've also got like the existing public markets and how they're being valued and the terminal value of these software companies now where clearly you've got pressure from the actual frontier models on the subscription revenue and the way in which these companies, I guess, attract or maintain these really juicy cash flows over many, many years through subscription, the subscription seed model.

14:41And it's a compelling risk when you think about how much private equity, private debt, and public markets are tied into SaaS-related companies in terms of their percentage of the overall S &P and how much that's grown over the last 20 years or so. So I think it's an ongoing theme and you know just talking about like open ai's um potential to get into phones and into the hardware space like it feels like every month there's a new sector which goes through a disruption based on the realization that ai is going to impact them in a in a serious way and i think that does throw a lot of confusion into the cfas out there who you know drive wall street in terms of the sell side desk and their research and the buy side traders and the analyst teams the traditional models are going to be i guess have to be re-evaluated in this new era does well i think that really bodes well for things like crypto because we've had a very hard time arguing the valuation of crypto to traditional investors it doesn't run like a blockchain i would argue can't really run on a DCF model like a typical software company would because of the nature of network effects and the actual creation of this sort of like base layer for a new digital economy.

16:12So I actually think it plays well into cryptos, it favors crypto as the convergence takes place, traditional valuations, traditional approaches, traditional sectors are going through disruption. Meanwhile, AI agents converge on blockchains. And the argument for having a blockchain allocation or having a crypto allocation really doesn't look as controversial as it has like five years ago.

16:43Kris Bullock:That's well said. I mean, because, yeah, I mean, that agentic economy is coming, right? So well said, Jamie. I hadn't even thought about it that way. So a quick break in your regular programming, if you're serious about your future, grab my free report called Prepare for 2030. I think you've got five years to make as much money as possible, and this guide will help you navigate what's coming. The link is in the description. Download it now. Let's move on to another one that's definitely, like, this one's trending all over Twitter today. Probably like every AI news publication is covering this particular trial here.

17:23Kris Bullock:So OpenAI and Elon Musk have opened their trial and Elon Musk is seeking to oust Sam Altman from OpenAI. So basically the core claim of this lawsuit is basically Elon Musk is claiming that OpenAI abandoned its nonprofit mission and used his early donations to build a for-profit company. So that's basically the claim of the argument. This is a big story, right? Because obviously, OpenAI is one of the biggest companies within this space. And depending on the outcome of it, if Elon Musk wins this case, that will force OpenAI to completely restructure, affecting its valuation, affecting its partnerships and deals with Microsoft and, you know, whoever else across the AI landscape.

18:16Kris Bullock:So, yeah, it's like the memes coming out of this have like poked fun at it. And, you know, you have all like the Elon Musk quotes and everything like that. But it's actually like you dive into what this could mean. It could mean it could be a very important case for the AI space. Chris, what is your what's your take on what's going on here?

18:37Bijan Maleki:Well, when I first saw this, I was like, well, what does OpenAI have to say about this? Because I was reading this article and it was talking about the claims that Elon Musk was making. And I wanted to see the other side of the argument. So further down in the article, I think it's important to point out that OpenAI contends that Musk was on board with the conversion to a for-profit company. and he's just a little bit salty that basically OpenAI started experiencing some success and so he decided he was going to start a competing company and also sue them at the same time. And that they initially had talked about the idea that of course it's going to need to be for profit in order to have the capital formation required to actually create these frontier models that are going to compete with everybody else.

19:31Bijan Maleki:And there's no way they could do that in a nonprofit scenario. And so, yeah, I don't know. I mean, both sides have a compelling argument for sure. I don't know one way or the other how this is going to go. You know, it's a lot of he said, she said.

19:46Kris Bullock:That's literally what I was going to – it literally comes down to hearsay at this point.

19:50Bijan Maleki:Yeah. Yeah, I don't know. I don't know. It'll be interesting what comes out in discovery, right? Right. Right. Yes. Not to get into sort of like the more sort of conspiratorial threads that are going through this story, but like, you know, I think I certainly get a bit of a bad vibe from Sam Altman. So I would be really, I think what Musk is trying to do is force a lot of discovery and disclosures of internal documentation, which could embarrass Sam, who knows. But I think it's going to be a spicy couple of months as the trial goes on.

20:31Kris Bullock:That's an interesting theory, Jamie, because honestly, like knowing what we know about Elon Musk, like I literally would not put that past him at all. And he doesn't really care whether they went profit or nonprofit. He's literally in competition with them. And he wants that discovery to like, you know, release any skeletons in their closet or anything like that. That's, that's, that's literally something Elon Musk would do. You can't convince me. Yeah, totally. I mean, I don't really know much about the case, but if I just recall back from memory, I think Elon was genuinely upset about the progression of AI initially because of the, I guess, the perceived threats that it could pose.

21:16And so I think initially he was of the view that it should be controlled or contained. and I think even wrote a letter back in the day, maybe during Trump's first administration or maybe it was during Biden's. But then he just sort of, I think he just joined the camp after OpenAI did what it did and just said, right, well, if it's going to go this way, I'm going to build the best, you know, in his mind, I'm not saying it's true, in his mind, ethically, ethical AI that's not as tainted as some of the other models or the frontier model companies, you know, due to their political biases. But, like, I think that's kind of, like, how I perceived the way he played out.

22:04So he kind of did care, but, like, now it's just a free-for-all. Like, it's a commercial land grab, and I think he's just going after Sam because, you know, he wants to expose him or embarrass him.

22:16Bijan Maleki:Right. Oh, well, definitely. Go ahead, Chris. It does mention in the article about what you just said, Jamie, about Elon being concerned initially about the powers. It says here, you know, AI could manipulate financial markets, disseminate misinformation, concentration risk, you know, all of that stuff. And as AI became more advanced, Elon became more worried, you know, just as you were saying. So, yeah. And now he's just now he's now he's got XAI. Yeah. Grog, right? Terra, TerraPath. Yeah, yeah, right.

22:50Kris Bullock:Oh, man. No, but there's something to that, too. Just a brief tangent. Did you guys see that Polymarket tweet that a company gave AI access to its database and it deleted the entire database and backups in nine minutes? So, yeah, be careful with this stuff, guys. Oh, my God. I did see that. All right. Well, kind of, I guess, speaking about the politics of it all, right, Google and I guess Anthropic are back in the Pentagon and the U.S. government sphere. So Google in particular signed a deal with the U.S. government. Apparently, it's a classified deal. Some Google employees were not happy about it.

23:36Kris Bullock:I think about 500 or so penned a letter to their, to executives kind of, you know, being against it, right. Stating their claim against it. Deal went through anyway. And OpenAI and X have also reportedly signed similar deals. So yeah, big tech and the government are, are embedded with each other more and more. It seems Chris, what are you, you have a good, You were just talking about Google and Android. How do you feel about this?