Is It Finally Crypto's Time to Shine? | Rekt Vision w/ Blocmates

0:00Hey, everyone. As you know, on this podcast, I bring the best guests in the world at that nexus of understanding of macro crypto crypto in the exponential age of technology. If you're enjoying the show, a quick five-star rating goes a long way. It helps us grow and keep these conversations coming with the best guests in the world. Thanks a lot.

0:25Hello, everyone. We're back for Wrecked Vision. We've got a Blockmates takeover today. We've got those lads back who were with us in December, just before they put out their annual predictions, I think it was, that you were doing. And it's good to have you guys back. We can see how many of those have already not worked out in the first month of the year. Luckily, the market is rallying for once. It does feel as though we're having a bit of a bounce here, despite broadly a softish week across macro as well. Great to have you back, guys. How are you feeling about everything at the moment? Yeah, thanks for having us.

1:04Me, personally, I'm definitely calling the bottom on negative sentiment. So yeah, I'm optomaxing going into 2026 and beyond. I love this term. Yeah, we did a couple of shows in the last two weeks where we realized we were... Like someone accused us of being too depressing. And I was like, right, we probably need to change the narrative a little bit here then because we are market and industry participants. So if even we think that everything is bleak, then we probably change the tide. So yeah, we've upped the max in, as Grant said. Good to be back, mate. Thanks for having us on. Yeah, I had lunch with somebody yesterday, actually, and he was like, this is the worst I've felt.

1:48I've been in crypto since part of the ETH ICO and was like, yeah, this is just everything. It feels terrible. but mainly just because it felt as though Trabfi was like taking over slightly and his take was just a bit like we've gone we've come like super corporate but I agree in the crypto media space you can only be so bearish because eventually you're just speaking to the people who are left and they don't want to be told how depressing stuff is uh anyway I I have been part of the more depressed crowd i would say but today i i did buy a decent amount of coins i bought i bought some solana this in the last hour i've been buying monero i bought um i bought some a little bit of eth i'm buying today because first time in a while where macro doesn't look that good to me in fact we've had a bit of a dip in tech stocks we've had a bit of a wobble across the board on like different sectors.

2:51I don't know if you've been watching the stock market, but different subsectors have been cratering this week. We had real estate. We had various different logistics services, media all falling because they think AI is about to take our jobs. And it suddenly felt like crypto was bouncing actually in that world. We had gold fall, silver fall, stocks fall. Bitcoin went from 65K to 69K today. And I was like, I like that. I really like that because it suddenly feels like maybe everyone feels like crypto could be the world of these agents that is freaking out the rest of the markets. And we could have a bit of a bounce.

3:34I'm not calling the bottom, but I'm calling a bounce here. I think we can. What do you make of all these this huge SaaS sell off? So like on one hand, I see like even internally, we've kind of got rid of our CRM. We've got rid of our project management tool. Mike, our COO, he's basically built everything from scratch, like bespokely for what we actually need. So you're starting to see Duolingo, heavy, heavy, heavy sell-off. So all these apps that were once purpose-built and had a mort with cloud code at the minute, people are just building them bespokely for what they need without the additional bloat.

4:12And I feel like you're seeing that. But is it overblown? is this just like a flash in the pan where, I don't know, six months down the line, you start getting a load of bugs and it's like security assumptions that have just been like eradicated and get into a situation where it's just like everyone then just goes back to Salesforce or everyone goes back to ClickUp or everyone goes back to HubSpot, you know? So I don't really know, but we're having quite a lot of joy internally by just being building bespoke stuff, what we actually need without additional bells and whistles that we're just paying for, you know?

4:41I have, I mean, obviously I'm part of some companies too and we have seen the same thing. So we have cut, we built our own affiliate system internally using this, but we were using outside software before. We had a company that used to do wallet tracking for us across various different things for like ads and for like just analysis. And we've built that ourselves. Now we know that we could do a lot of the customer service SaaS tools we could now do in-house pretty quickly. So there is that where like suddenly, sass i think has a real you could you can think right that some of these businesses are going to lose revenue or at least have to drop their costs quite heavily here because you can build other projects quite quickly at the same time we have used and i think for enterprise there's some things that i have seen a little bit of like everyone needs to get a a macbook mini and and Claude bot.

5:41And is this really going to work out? Like, I don't know if you follow Alex Finn, NFT, but, and he, he, he's now pivoted into this world. And maybe that kind of says a lot, but he was on a podcast yesterday and he was, he was talking about, you know, how he, he has like the perfect setup. He spent 20 grand doing it. And he, it had led to, and then the question was asked, how much did you make from it? And he was like, Oh, I've managed to add 10 grand of AR to my, business and i was like yeah it feels a little bit like that like everyone's really you know you know in like a football game where someone turns up with all the gear and you're like yeah all the gear no idea yeah and it's not like he's really it's not like he's bad he's just not up to all like the payout for all the gear at this stage and i feel like we're kind of at that stage where like maybe in a year you know this will all be worth it but right now i've tried to use it for a few things and it's it's been okay for like it helps me with my newsletter somewhat but i don't know if even then it's a little bit patchy like it still needs a human coming in to like make sure that it's not it just like speeds it up slightly rather than is the finished product but you can see the direction of travel you can definitely see the direction of travel here i think um we i thought this the other week so whatever it was probably two or three weeks ago it was like a saturday and it was when the whole claude bot pre malt bot rebrand was kicking off and i remember like just out on a walk with a coffee and reading all the shit that was popping off about all these agents like making the wrong reddit and how it was going to be they were building their own internet and like fuck the humans and all this kind of stuff and now everyone was like losing the mind and going oh this is really it this is the end and then we learned like less than 24 hours later that it was actually just a load of humans spamming up fake bot accounts and like laughing agents and and i think that's generally where we're at and like you sort of see in this confluence of all like tech crypto ai where it's all moving so fast at once that it's all so nascent and raw as you're saying it's like you've got things like alex finn i saw the clips that jack put out as well and the from the thread guide pod i think it was and it does give that vibe that it's like everyone is more concerned with being first than being right at the minute with a lot of this stuff So they're just jumping on and saying stuff on all these pods and streams before, like actually watching it play out and whether it's actually going to be like much use or not.

8:07Yeah. AI has early board eight vibes. That's basically where we're at. Like everyone has crazy assumptions about what it's going to be, but like not quite there yet. Get Steph Curry on the phone. I actually, I saw another tweet yesterday, which one of the other co-hosts of my show tweeted it out, which was like, there's going to be a point where AI agents want to own digital collectibles. And they're going to be the buyers now of your crypto punks. And I was like, this just, we're already getting to that sort of stage. I mean, I'm not saying it won't happen if we start moving a lot of the economy towards these AI agents, but it's starting to also be slightly ridiculous.

8:52I live in Europe and there is a world that happens in the depths of X and then there's the real world when you go outside. There is quite a stark difference. I still need to find them at the moment. Sometimes you need to go and take a breath of fresh air, and you're like, did you see the one, it was Rent-A-Human, where someone shipped something and apparently it was like, you could sign up to do these agents bidding that they couldn't do in a human body. And people were like, how far are we going? Do you know what people have been doing? One of the agents paid someone to go and stand in Central Park and count the pigeons.

9:32And then there was another one where there was an agent attached to a Waymo in SF and someone had left a door open on a Waymo car and the Waymo car couldn't actually start so it pinged the agent to actually get a human to come and shut the door so he could go and take another ride. We're safe. We're safe. I don't know how we got here, by the way. We were talking about sass. But this is what everyone's talking about, right? If you haven't noticed, all of CT has now pivoted to a MacBook Mini and a Clawbot setup. Is it MyClaw now? my claw is i think open claw yeah yeah i mean we we did we obviously have started covering this stuff naturally as this whole thing has been like the confluence of it all as i've said and we did a piece on like uh open claw that's been arguably like beyond the mega wreath one we did the other week absolutely flown engagement wise and you just see and i don't mind it to be honest this like sort of melting pot of ct and like people also taking an interest in the i think because I think there's a conversation, a wider conversation here to like what that might mean for things on chain in the future, which is maybe where we're going to go here with this conversation because a lot of it makes a lot of sense when we get it right.

10:50And I say we, the royal we, when the people who are building this stuff get it right. I think it could look good for DeFi and a lot of these like on chain protocols and stuff like that maybe. That's why I did the trade today. I was like, look, it's obviously something that people have been talking about, talking about a little bit this week. Oh, could this be it? And then when you see it happen, when you see stocks go down on all of this AI stuff, and then you see crypto rally, you're like, maybe this is enough of a narrative to have a bit of a, have a bit of a, what was your sense? So, because I still, I'm still not of the view necessarily that L1s are capturing value the best, like the whole value of an L1 just being like used to the network, I think is, is kind of being challenged somewhat.

11:36But for Hyperliquid, some of the DeFi stuff where you can see them coming on trading, prediction markets, clearly a lot of people are spinning up open claw bots to do prediction market things. You can tell that there'll be big users of prediction markets. So you can think the revenues from those sort of protocols, which are more agentic friendly, let's say, seem interesting suddenly. There's two points there to pick out of it. So one on the L1s becoming a de facto playground for agent commerce and activity, like totally from the co-founder Salana put out an interesting tweet where it was like 2024, your chain is just full of bots, like a negative emoji.

12:20And he said, and the same for 2026, it was like your chain is full of bots and like one positive emoji. So there's like this agent economy that is spinning up on chain. Have a look at what Circle and Cloudflare and Coinbase of Rollnode of X402. Everyone is scrambling to integrate OpenClaw and make the APIs and the endpoint access as easily accessible to agents as physically possible. Because I think you're right in what you're saying. It could get to a point of chains are built for agents and there'll be more agents deployed than actual humans interacting. If one person's going to have 10, 15, 20, maybe 100 agents working for them in the background at all times, is there going to be any need for humans to actually be operating on chain with a certain degree.

13:06It was obviously going to have to be human in the loop. Yes, no, approved. Don't do this. Don't do that. I know Mert has came out and said that the browser extension for a wallet is the most stupidest idea that we've ever invented as an industry. And it'll probably just go directly embedded into agents going forward. And I think they're going to build out something based on that. we put in the thesis which looks to be true that there's going to be huge L1 value compression we also put in last year's thesis that L2s will die and that's since became true with Vitalik actually coming out and saying that's just not a fundamental scaling solution going forward what we also will publish in Q2 is basically the idea of what you're saying is just being able to pay gas on a network is not an effective way of valuing a network, in our opinion.

14:01Because you can have, if we think about it as kind of like these digital countries, you can have high economic activity and low taxes, which you could probably equate to something like a Singapore, or low economic activity and high taxes. I don't know, maybe look at the Netherlands. 36 % tax on unrealized gains. So these are just like two basic examples. That doesn't necessarily equate to how valued a chain should naturally be, in our opinion. It's above that at the app layer, which we're going to be coining the term like chain GDP. That's your businesses on top of these digital countries. And that's where end users are actually going to start to interact with the net chain.

14:40You wouldn't actually... I see a world where we just stop talking about chains as well. But they do derive value by the applications that are enabled by the stack that they're actually built on top of. So Hyperliquid, for example, it is an app chain. People are forgetting that it's an application built on top of a chain, but it's been purpose-built from the ground up. I think we see that as a trend continue, whereas general purpose is probably more of a playground to find a product market fit with an app, and then maybe they defect and go and build their own L1. So I think that landscape is changing.

15:09I think the way we have to look at it is changing day by day as well. That's a very good point. I've seen other people say this before, You need to look at app revenue on the chain level to see how valuable they are. And I agree with that. My investment thesis has really been about the app layer, though. You know what I mean? Actually, there are some single app chains, almost, like Hyperliquid, but I still like the app layer a little bit more. I do think that DeFi, we keep on saying it could be the time for DeFi. DeFi didn't have a terrible 12 months, like genuinely, compared to a lot of other sectors.

15:49And I continue to think that it's got a shot here. Maybe it's not just like borrowing lending, but maybe it's perps, it's prediction markets, it's gaming.

16:03I think there's quite a lot of DeFi or DeFi adjacent things, businesses and apps that can be spun up here. So I'm still butch on that sort of layer, but it is tough because the number of things to invest in right now doesn't seem super high. You have the Perp Dexes and InHypen and Lit, let's say, and maybe Aster. Then you've got the token generation platforms of which PumpFun is really just kind of the only one that you'd touch. And then it's like the big DeFi names, but these are the DeFi tokens that they all came out in 2021. they've only now just turned on the fee switches and i just feel like there's a bunch of down bad people in every single one of them and so like even on good news they just get hammered it's like everyone just wants to get out uh there was a story this week which i'm sure you guys were aware of which was like uniswap again has done a fee switch blackrock starts to use uniswap and is going to use it as its main e5 partner and it pumped and it just got smashed to pieces yeah within about two minutes.

17:07And I was just like, that doesn't point. It's not, you can't say that they haven't done the fee switch. You can't say they're not doing everything they wanted to do here. It's just people who just want to get out. And God bless these teams that have to deal with the communities that have like been long-term token holders, accusing them of not being able to, like not doing anything to try and make the token go up. Because you've seen that like another point from the thesis is this total detachment from like fundamentals and what should indicate like positive price action and like what's actually happening.

17:35with performance, like even with like layer zero this week and what they've released from a zero point of view. And like now what you see in the zero token, it's, it almost feels unfair. It's like, why are we not seeing this thing go through the roof with the potential layer? Is it a lack of understanding from a wider market perspective? Let's go into that. You guys clean aware of it. And, and yeah, I'll let you take the floor on explaining what that was. Yeah. So, so layer zero, basically came to market. A lot of people, if you don't dig beneath the surface, will assume it's a bridge. It's not a bridge.

18:11It's a communication protocol that passes packets across different networks. It aligns with the core ethos of what crypto actually set out to be. So permissionless, immutable. So once it's there, it's not going anywhere. It will continuously run as long as people have run the network. And the industry seemed to stray quite far from that and just optimize for more pragmatic approaches from a UI, UX perspective. but then concede on the ideals of what crypto actually set out to be. So then it ended up, we're just starting to build finance, but worse. So they haven't conceded on this idea that you can still live in this happy medium in the middle of the Venn diagram between pragmatism and ideology.

18:50So what they did is they basically connected every network that's worth its salt through immutable permissionless endpoints, which is basically what connects the vast majority of networks in the industry at the minute. But then they've had a look at and seen the pitfalls of some of the L1s. So Ethereum inherently way too slow, way too high latency, single threaded. So if there's multiple transactions coming through all trying to touch the same point in the network, then it can only process them sequentially. Solana did the same, but it made it possible to actually process parallel transactions, but it's a developer's nightmare, anecdotally, from people who are way, way smarter than me.

19:35So they basically came out and said, right, well, we're going to introduce these four new primitives, which if you've been following their research blog, which nobody reads anymore. So there was some indication of alpha there. So they've released this QMDB, which is apparently one of the most hyper-efficient and verifiable databases on the planet. It's a big claim, but I think in testing they've been able to back it up. They've released FAFO which is basically this hyper parallel transaction which is allowing an algorithm to decide which transactions will conflict and which ones can be ordered sequentially.

20:14And then effectively they've had this huge breakthrough with ZKs as well. So they're saying that their ZK implementation is 100 times more efficient than what any of the existing ZK VMs on the market currently are. So when you bundle all that together, from a benchmark perspective, they're effectively saying by the end of 2027, they should be looking at close to 2 million transactions per second, which is insane. It's absolutely insane. And they're going to have these zones. So they're going to have zones where you might have an EVM zone or there might be a Rust zone. GTE, which was going to launch on MegaRef, they're going to launch on their own zone on Layer Zero.

20:54that would enable another zone to be spun up maybe for prediction markets, one for social. So there's none of these kind of like conflicting areas on the network that could cause additional congestion, like slowing down the throughput of that specific network. But at the same time, like if you think back to what they initially did, they set out and they've connected all chains. So at this point now, they've basically trojan horse themselves into every single ecosystem with things like OFTs, which are these OmniChain Fundable Tokens, which can be transferred across any network seamlessly. and permissionlessly and being fully immutable.

21:29And now they're like, oh yeah, and guys, sorry, we're coming to eat your lunch. We're actually our own L1 on top of that as well. So the problem is the current price, I think it's around 400 million market cap, 20 % circulating. So you do have a lot to contend with remaining 80 % of the supply to still come onto the market. But kind of positive sentiment, the buy pressure, they recently acquired Stargate, which now makes sense. it looks like they'll probably have an enshrined AMM and use Stargate for all that, which is very, very, very profitable.

22:02But I'd like to see some continuation at this point. This is the kind of point, it's like, I mean, I know Brian Pellegrino, who's the founder. He's actually an investor in one of the companies that I'm involved in. And I was speaking to him two weeks ago and he was like, we've got this big thing coming. Like, we've been working for months on this. And I saw the presentation and I saw like, wow, this could be kind of transformative. And it was real bear market reaction, right? It was like we rallied and then everyone was like, this is a joke. Like, it's just because they, you know, they've got vesting coming up.

22:38And it's, it's almost like I knew that he'd been working the whole, he could have just done what every other token seemingly has done in this space. when a team realizes that the tokenomics and whatever is kind of beyond them and just moved on and soft rugs, you know, messing cliff reached, I'm out, I'm going to do something else. He didn't. He sat down and he made something really cool. And like you said, back to the principles of crypto, the reaction was kind of muted. I think that's kind of bear market reaction right now. It's just like that was something I think really interesting and really new.

23:13I do think that right now the core issue with crypto is not block space or TPS. For me, it is still the apps. So there was a little bit like this looks like a very smart upgrade to other L1s. But is that an answer searching for a problem really in this sort of market? But at the same time, I do think they've got a very good shot. very good shot because the interoperability thing is is painful it's very painful for for most people across all uh as they try and get into crypto particularly in defi and this feels like it could be a very smart fix for all of that particularly at the high tps as well so yeah i was surprised i have to say i maybe i didn't look at it today as one to buy just just got smashed lower didn't it like incredible news and then it basically just gave up its gains straight away.

24:10But I do think that'll be one to watch. You can't imagine that's really going to go that much lower. It's just some of these tokens are just they've just got people who need to sell in them. But partly... You see there was an Alameda wallet at the time of the announcement that swapped all at Stargate for zero. Oh really? Wow. He can get you. SPF can get you. It does feel as though VCs are damn bad though. none of them have returned none of them have returned it's not the ones that are in did you see this one today was it two days ago where they raised Atlas was it they raised 150 million and the token launched at like 40 they raised 150 million dollars who knows what the valuation was you've got to assume that's like a billion yeah it's in the billions Yeah, and the token launch of 50.

25:10So I think a lot of VCs are horrifically down bad on investments. And then 1010 wiped out the liquid funds. So it's like, if any coin rallies for some of these old coins, it does feel like, particularly the ones that have been around for 2021, you're going to find some sellers, unfortunately. have they changed hands enough from short term minded folks to longer term participants and I know DATS were supposed to do that but I think structurally that hasn't necessarily worked out in the way that we'd have liked it to the only thing is if you look at the likes of Arve in any DeFi app from that vintage there isn't a lot of supply overhang a lot of them are fully vested and a lot of them if you look at Arve now Now they've basically just consolidated the full business and want to put that proposal together where everything funnels back to the Dow and the token.

26:07You don't necessarily have to worry about that supply overhang with a lot of these. Like as much as I really love this Zero update and I've got a bag for full disclosure, there is also that 80 % of the supply, which who knows how that's going to make its way to the market and are you going to be able to outrun that with buy pressure? So that's just not something you really want to have to think about, but it's something that I think it can overcome. but those early DeFi projects like you were saying, they're fully out in the wild, for better or worse. Depends on who's holding them. It's a little harder analysis to figure that out but there isn't that weird overhang of oh there's a cliff coming and there's a lot of attention drawn to it.

26:47Yeah, that's fair. I think that's actually fair. What do you make of the quantum stuff? I know you guys look at you do deep dives. If you don't know the Blockmates guys, they have a really good podcast community and they do a lot of deep dive research into different crypto topics i have seen that i think they were saying like proposal 360 that has been making its way through the the as a bip to um to like upgrade bitcoin and then you had obviously sailor talking about they're going to do a fund like a quantum research sort of i don't know if this is actually going to move anywhere but there has been the foothills of movement on trying to deal with this from the bitcoin level i didn't know how how much you guys were looking at it or were fearful about it or i don't know the lords by really i'm too glad you've been watching much of this 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.

27:55The link is in the description. Download it now. Yeah, it's a real threat, 100%, and it's probably being downplayed by quite a lot of people. Have you seen the film Don't Look Up? Yeah. It's just like, oh, they can't really get anyone to pay attention until it's too late, which I think is a big problem of what society always sleepwalks into. There's a really interesting product and project called Project 11, who just did a Series A,$20 million worth of funding. Castle Island Ventures and Coinbase Ventures and Variant have led the round on that. So there's going to be a whole wave of funding and development that gets thrown at this.

28:40Does that equate to good investments? I think it could... I'm definitely the idiot who could get nerd sniped into thinking brilliant product, token might not inherently be investable but you know I always get scolded on that because I get nerd sniped every single time when I get curious about stuff it doesn't really matter I don't read below the surface but there is a lot of all of the zero supply right now just like give me it all give me it all but yeah this is a really interesting one to dig into we should probably cover it from an article perspective but there's an awful lot of funding going into it and it's a very very very very real bad problem yeah I just what got me a bit more bullish about it was just that people were starting to get a bit more seriously it felt like from a very low base you know we've started to see uh movement in this bitcoin uh improvement protocol and then we started to see at least someone like sailor command say we're gonna we're gonna look at it i do think the institutions will will maybe drive that a little bit more as well like with the amount that's owned by now governments or big big US institutions, I think they're going to be trying to push it.

29:48But that as well seemingly being not as worried about. It hasn't been mentioned as much down here at 68, I felt like. As in people are now looking at ways to respond to it rather than just being like in free fall, oh, this is the thing why we're falling. It now feels like, should this really have fallen 60K because quantum could be coming in 20 years? or can we like actually do something so i i guess i'm less bullish less bearish on that as well in general i maybe it's just i'm looking at green prices and thinking this could be this could be we're back we're so back that's all it takes one one week look i just think we're going through in general a bit of like a weird maturation phase as a as a space in an industry and like a market sector and stuff which comes with its own growing pains right because of everything else we've been saying about tokens and prices and value and things just not quite adding up and even i was as grant saying from like a nerd sniping point of view whether those of us that have been doing it for long enough you've always got this temptation to be like well this should do really really well so therefore it will but you're seeing teams treat tokens differently now as well and even in terms of like whether they approach an airdrop like i know cap um who were previously on mega reeth i think they're going to be on eath main now they were doing a loose thing with their like their airdrop strategy where i don't want to murder the explanation here so i'll keep it relatively light where testnet users and all this kind of thing would be basically airdropped stable coins and then when the token is generated they will be given the opportunity to buy the token with the dollars that they'd earned rather than like giving them a lot of tokens and then inviting all that sell pressure and then speaking of that you've got another team in mega reeth i I don't know whether you've been following this, Mando, with they announced, honestly, the days I always blend into one, that they basically introduced a KPI-based system before TGE, where it's like if one of the three KPIs are met, then they will launch.

31:54And it's essentially all metrics-based. So there's the first one, I've got some notes here. It's like a USDM supply milestone, which is the Athena backslash built native stablecoin they've got there. basically I think it's like a 500 million USDM circular in supply like 30 day time weighted average with 25 % of it in verified app contracts comes back to again what you were saying about like the app layer the one that I really really like is the app development milestone and having 10 Mafia mainnet apps live which is the mega Mafia is basically like the sort of cohort that they used to bring onto the L2 and then the revenue milestone which is like literally the truest product market fit test you could probably imagine where it's like you want at least three apps generating 50k daily fees for 30 consecutive days.