E183: Jupiter COO: Getting Rich In Crypto Has Nothing To Do With Luck

26:28Does that not go against traditional principle of investing, which is try to find our business hard, the right assets and you buy and hold forever. I think that works for some, but it is, there are many projects which people thought would last forever that did not. My personal kind of like philosophy on this is like you want to have, you look at the stock market and it's giving you like 7%, right? So if you're trying to build whatever, 100 % a year returns, you're obviously going to have to play the game like a little bit differently. If you want companies you can buy and hold forever, public equities are a great place to go.

27:06In crypto, I mean, like Jupiter itself is only like, what, five years old at this point? It's hard to say that you should buy this and hold this for the next 100 years. Now, I hope people do. You know, I certainly am planning on doing so. But like, you got to understand that these things are kind of trades that you're putting on, I believe. Is there one, and if yes, what's the one true proven method to actually compound wealth? in crypto investing? This is going to sound a little lame, but the answer is actually in yield. I think not enough people are thinking about yield and lending opportunities, and they primarily think about trading.

27:45My view is that on-chain credit is basically where on-chain trading was like three to five years ago. You're starting to see the bubbling up of like real value, sustainable value, interesting kind of mechanisms and models. And that's really where I think people's portfolio should go. Again, I'm not the best investor in the world. I'm not trying to give anyone financial advice, but a substantial part of your portfolio, if it's in very high risk assets, should also be in stable coins on the other end. And there you're looking to earn five, six, seven kind of percent. And that's really what compounds, right?

28:16So the compounding is the closest thing we have to magic in the world. If you're just able to keep those stable coins alive, pick the right safe protocols that don't get blown up and earn that five, six, seven percent year on year on year, that's really where the wealth starts to accumulate.

28:33On stable coins only, the reason I'm asking that is because I had a few people like Raul Pal or James Wu was like kind of like the youngest crypto billionaire, 30 years old, maybe 32 now. And I think he runs a DFG, like 1.5 billion maybe 2 billion now and he was saying and Raoul was saying and a bunch of people were saying it was more two years ago maybe things changed probably things changed a lot they were saying that the risk of the yield in crypto is too unknown and is too small the yield that you get is too small compared to the risk or at least it's kind of difficult to gauge how much risk you're taking and the reason you're in crypto is to go with this high capital gains right and therefore it's not worth to like put your bitcoin and earn an extra three or five percent or i mean maybe staking right but except that what's your thought on that because because we saw like everyone blew up a couple of years ago.

29:51Correct. Yeah. I think on like Bitcoin, like there's a lot of people that like to sell covered calls on Bitcoin or do these kinds of option strategies. And listen, that's fine as well as it goes. I don't think that those are strategies for most people who are trying to like enter the space. I will say in general, there's like a funny thing that happens where people look at like the best in the industry for advice, right? So if you wanted to learn how to play basketball, you probably should not ask Michael Jordan for advice on how to play basketball, right? Because he's just at a different level.

30:19It's the same with James and some of these other guys. They're playing the game over a different place from a bunch of different reasons, right? Whether it's inherent skills or privilege or connections or what, I don't know what it is, but they are not like a lot of the people that might be trying to get into the game. I think that you want to take advice from those folks, not to say it's wrong or that they're wrong, but you take it with a bit of a grain of salt, right? And you try to look at not how can I go from$100 to a billion dollars, right? But you want to say, how do I go from like 100 to 10 ,000?

30:45How do I go from 10 ,000 to 100 ,000? You kind of have these more realistic kind of targets. Now, there i'm still talking about 10x like returns right so that's not uh that's not trivial kind of gains uh but yeah if you're looking to actually get and yield on these kind of volatile assets most of the time you're better served just holding the asset and hoping that it goes up and for a lot of these assets you know history would kind of vindicate the idea of just hold it lower your risk of blowing up there but when you have stable coins i think it's a slightly different kind of game i can not blow up but i can lose all my money due to hacks which which happens all the time in DeFi.

31:22So again, and we're in this industry that people come to kind of gamble, whether it's on a Bitcoin that a lot of people still see as gambling or on like crazy, whatever meme coins or other coins.

31:37What is the true merit today to park, I don't know what percentage you would say, 20, 30, 50 % of the portfolio in stable coins? and earn only 6 % when every month or every week there is another hack in decentralized finance. Yeah, it is all about table selection, right? Like in poker, that's the main way that you make money is like you play at the right tables. Like if you could be the best poker player, but if you're playing against, you know, Phil Ivey and these guys, you're going to lose money, right? So instead what you want to do is play at like tables where you know that you can actually kind of win.

32:15And I think there's a very limited number of protocols that I think are kind of trustworthy in that sense, that have a track record of not blowing up that you might want to put money into. Where the industry will actually eventually go, and we're working on this at Jupiter as well, is you keep your collateral in custody, in Fireblocks, in Anchorage, in BitGo or wherever else. And that way it's kind of safe from the protocol risk. And I think that's how we go from like a few billion to hundreds of billions, because that removes or greatly mitigates part of the risk that might end up coming in. So again, it's like up to the builders to find ways to make it more safe.

32:49And it's up to the users to do their research and understand which protocols, you know, actually are worth taking that risk for the 6%, the 7%. Enlighten us. What are a few protocols, it's not obviously financial advice, but that you personally feel comfortable putting a substantial amount of money, stable coins to earn yield that you think are less likely, which doesn't mean they're not likely at all, to get hacked in the future? I'm a Jupyter man. And I use Jupyter Lend. It's like the main thing that I use. It's where the vast majority of my kind of like yield bearings table coins are to be found.

33:32And the reason for that is we've had a great track record in the whatever year plus that we've been around. But I also have an inside view. So like I know how seriously we take security. I know that we've been audited seven times. We're open source. We're formally verified. I know that we have the right offset controls and so forth. And so what we try to do is give our users a bit of this edge in risk management as well by making that as transparent as possible and bringing it to them. So, you know, you ask a barber if you need a haircut. If you ask me, I'm going to say, go use Jupyter Lend. It's the best place to go.

33:59But I think there's many others like Fluid is great. Aave is great. Like there's a number of protocols that have been around for a long time. Sky, et cetera. There is just a bit of this Lindy effect, right? Like the longer you've been around, the more likely you are to continue being around. What percentage of your portfolio is in stable coins earning yield? The answer is, it's kind of shocking, but it's like north of 50%. Wow. Yeah, I'm mostly in stable coins. Yeah. Because my view is that it's a barbell, right? The other 50 % is in extremely high risk assets that could go down by 85 % in the next six weeks.

34:33And so to counterbalance that amount of risk, I need to have some stuff that I think is much less risky on the other end of it. It's also probably, I don't know, because these 50 % in dollars represent a substantial amount of money and probably bring you interesting yield to even live your life, right? Someone who starts like now in crypto and has like a much more portfolio might take more risk, even though it's not necessarily the right way because people who take a lot of risk usually blow up. Yeah, exactly. But that's the logic. I need to take crazy risk because I have this small amount. like i have this argument all the time like buy sol or buy bitcoin or buy i don't know z cash but well but it's already 10 billion dollar what's the upside on that i need to buy this shit coin i'm like you're gonna lose all of it there's this uh there's this idea uh called the four noble truths of buddhism right where it talks about like life is suffering and suffering comes from craving or desire.

35:33And I think that's exactly true in crypto, right? It's like in crypto, there is rugging and rugging comes from greed, basically. And so going back to the idea of like, how do you succeed here is you have to temper down the greed. It's incredibly difficult to do, especially when you see all these other people who make it rich. But a lot of that is survivorship bias, right? You're not seeing the post from the, you know, 10 ,000 guys who got wiped out trying to trade meme coins. You're just seeing the five posts from people that did actually make it. and who haven't blown up yet. Yet is the majority of them.

36:03You think they made it, but they made it for now. Yeah, exactly. Check it out for years. Yeah. I mean, we saw this, again, I don't want to name names and shame on it, but there's a lot of major perpetrators that we saw who like ran it up to nine figures and then gave it all back in like six months. Most of them. Yeah, it's the, it is. And honestly, it's part of the industry's problem as well is that I think a lot of projects kind of promise these high returns or come here, you'll get rich quick in order to kind of bring more users in. Because it's the fastest way to grow. Like I understand why they do it.

36:32But I don't think it's like the actual sustainable way to do it. Like getting rich slow in crypto is actually the move, right? Buying Bitcoin and ETH in 2016 and just waiting or whenever you initially bought it and just waiting is really oftentimes going to be a good move. I actually like tweet this all the time. And I stole that from Balaji. Crypto is a get rich slow scheme and a get rich direct quick scheme. yeah that's right right yeah that's it you want to be long-term greedy right is like the goldman sachs kind of line here is like you're you should not try to optimize in the short term so much the problem is you need to realize because you can think i'm long-term greedy i'll take my own example 2019 i buy a bunch of bitcoin and I'm like, oh, I need more Bitcoin.

37:23I discovered BitMEX. I'm like, I can make more Bitcoin by trading leverage, right? I'm like, okay, I'm going to do only 2x. March 2020, I get wrecked because in one day, Bitcoin goes down 60%, right? So you're even at 2x leverage or 1.5, like you're basically gone, right? Everything lost. Then you're like, I will never use leverage again because these blow up events happen every, at least once a year. There's a big blow up event that kills even people who are on 2x leverage on most coins. Now I'm going to be smarter.

37:552020, 21, I discover, I mean, I put all my money in ETH after the COVID crash. So it goes up a lot. Then I buy a lot of sold at$3. It goes up a lot. Then I discovered this Luna at$3. I put a lot in there. I'm like, and then I'm like, and then I put all my coins on Celsius and I'm like, I'm not using leverage anymore. Yeah. I'm smarter. Yeah. But you don't realize you are, all these yields are basically leverage. That's right. It is, but you don't realize. So you say long-term greedy. I'm long-term greedy and I'm only spending my yield. So I'm doing the right thing. Well, next thing you know, you are not long-term greedy.

38:34You thought you were long-term greedy, but you were just as greedy as anyone else, but you're dumb on top. Yeah. Right. And so how can someone have some red light flashing? Like, hey, you think you're doing the right thing, but actually you're not. Be careful. Rule number one is don't fool yourself and you are the easiest person to fool. So I think you have to look at those numbers on yield in particular and say, why am I getting paid quadruple what the treasury rate is, right? Yield is like literally you are putting a number to risk, right? That is what it represents, is the abstracted amount of risk that you're taking on.

39:12So by definition, as that number goes higher, you are taking on more risk. So anything that's offering 20 % yield is going to, here's a different way to say it. Anytime there's an opportunity in front of you, you should ask yourself, how did I get so lucky that I have access to this opportunity? Now, you're a very well-connected guy, you know all the founders, you might get access to things that other people don't, and they might offer better returns as a result. But for the average person who's getting into the game, if somebody is giving you 20 % yield, you better believe that there's some risk that you're taking on in there, right?

39:42And so you don't want to just say, oh, because it's not leverage or oh, because it's not a meme coin. You know, the returns tell you how skeptical to be. And that should really be what's kind of turning up your skepticism radar or your concern radar. And then the real true answer is diversification. It's not that a 20 % yield opportunity is inherently bad. It just should not be 100 % of your portfolio. It should be like some small amounts or distributing risk across the curve as opposed to concentrating it all in one place. Quick shout outs to our legendary long-term When Shift Happens partners, without whom none of this would be possible.

40:16Thank you to Cast, my go-to global money app to store, earn, move, and spend stable coins across 170 plus countries directly with Apple Pay or a physical card. On top of that, I can also get paid in USD and Euro with my Cast virtual account. Use my promo code SHIFT and my link below to get 10 % off your membership, earn up to 3 % instant USD cashback on every card spend and get up to$250 in cash for referring your friends. No banks, no borders, just money that moves with you with stable cash rewards. Trading is a really big industry. There's a lot of money involved. Actually, most of the biggest businesses in crypto, Jupiter is one of them, makes a ton of money on that.

41:09But you're saying that the TAM, the total addressable market for savings and yield is way higher. Can you explain? I think that this is where the industry is going to be going. If you look at the actual kind of like economic value that is created by trading, there is plenty, right? Like you're actually contributing to the capital formation process, teams that need funding get it and so on. yield is the kind of thing that every single person wants right like i talk to you know my cousin or whatever else they're probably not going to start trading tokens maybe they'll buy and hold bitcoin and that's that's about as far as they go and maybe a little bit of jupe because they know me they're but if i tell them about kind of interest rates that they can get especially insured interest rates that's something that's really interesting to everyone from like you know a grandmother to you know an 18 year old kid who's fresh out of college and just starting to get some paychecks.

41:57The total addressable market is basically everybody that has a savings account. And there are many more people that have savings accounts than have brokerage accounts, right? And you see this in the fee generation as well, is that a lot of the banks make most of their money from lending and from credit as opposed to trading fees. And so I think that's really where it's going to continue to scale. What's blocking it right now is one, poor security practices, poor image of the industry, right? Atoning for the sins of others. And the other is having the right products there, right? Historically, crypto has been all about floating rate, right?

42:26That's So Jupiter Lend is, Aave, and a lot of these products are. It's hard to use those in the real world if you're an actual borrower, because you cannot be thinking, I'll pay 5 % today, 15 % tomorrow, 3%. You can't plan a business around that. What we need is fixed rate, fixed term lending to really come on chain in a big way. We launched a product for this at Jupiter called Offerbook. But I think many other people are also starting to look at this space as the way that credit really starts to scale, which then enables a lot of people to get kind of real world yields that are uncorrelated from crypto price action.

42:55That's really the key. That's how this starts to blow up even more. Blow up is the wrong word. That's the way that this starts to grow even more. When you have uncorrelated yield opportunities, whether it's reinsurance, payment financing, things like litigation finance, there's all these kind of areas where financing is needed. And crypto rails can be better suited to solve those problems and draw capital in. And that's what's going to create, I think, a much larger industry. You said before you started your builder's career in crypto. in the Solana ecosystem by being a founding team member of Super Team.

43:34So we need to talk about Solana a bit. Let's do it. One of my favorite topics. 15 % of the traders on Calci think that Sol will be above 150 US dollars this year. Inshallah. Inshallah. Is Solana rising from the ashes once again? I think the answer is clearly yes. There's this weird mismatch where anyone who's in the industry and understands what's actually happening on Solana right now is ridiculously bullish, like omega bullish right now. The network is getting better and faster. Alpern Glow is coming, which is going to really put it on par with a centralized exchange kind of experience in terms of block times latency and finalization.

44:17and the number of participants that are coming on chain right now is just going through the roof, right? I mentioned some of the names earlier who are doing some POCs and we're starting to see them start to scale up. Well, let's use RWAs as an easy example here. In the last 30 days, something like$700 million of RWAs have come to Solana, which is more than have come to all other chains put together, right? You got to follow the flows. That's the key thing. For a long time, it was stablecoin flows. Now you want to follow the RWA flows. And again, it gives you a picture of where things are going to be going because liquidity begets liquidity.

44:49And as more of those assets come onto Solana, the easier it is for the entire network to continue to scale. Where is this money coming from? Honestly, it's coming from, partially from other chains, like it's coming at the expense of some, but it's also kind of net new money that might be coming on, right? We talk about credit. Centrifuge has a great product with Janus Henderson. It's a CLO product. I believe that they have something like$750 million that they kind of brought to Seoul, which is being used by, like Athena and many of these other folks. So as the industry kind of grows, the assets want to come to Solana.

45:20Another great example is tokenized equities, right? Where something like 98 % of all tokenized equities trading on chain is happening on Solana. And so you just, you follow the flows and then things become pretty obvious what's going to grow and what's not. When you say 700 million or a billion dollar in liquidity came within a month in RWAs, real world assets on Solana, what does that mean exactly? What are some examples of things that are done where we can actually say this money is used for that thing that is a real use case on Solana? There's a number of individual products. So people should do their own research before they actually participate in these things.

46:02But you look at Prime, which is issued by Figure, and it's kind of backed by these home equity loans. You look at Henri, which is a reinsurance protocol. One of my favorites, I think our mutual friend, Herbal. it is Huma Finance, which is payment financing. And they're just solving real world problems, right? So let's use the Huma Finance example. They provide credit basically to payment processors who are using traditional Rails, and they might have T plus two settlement, and they need financing for those two days to be able to continue to run their business. Uncorrelated with kind of how crypto works.

46:33That just happens to pay like 9 % because those companies are willing to pay 10 % to be able to grow their businesses. Those are the kinds of opportunities that are coming more and more on chain and more and more on Solana in particular that are interesting. And then the other bucket would be these kind of tokenized funds that are coming on chain, right? So Apollo's ACRED is an example. Benji, which is like a treasury's fund from Frankel Templeton is on Solana. Biddle from BlackRock, et cetera. So those are just kind of like traditional assets that now want to be on Solana because you have access to a global audience, instant settlement, can move all over the world in a way that's actually like easy and fun to use i talked to lily from the solana foundation i think last year maybe a year ago and we had a conversation beforehand about what are some good questions to ask her yeah yeah lily's a good friend yeah and um there's this question that you asked me to ask her oh i'm gonna ask you oh no hoisted what's solana uniquely bad at today Oh, man.

47:36I was really trying to get Lily on that one, I guess. I think Solana is unique. At the time, I think we were uniquely bad at interacting with other ecosystems. It felt very tribal at the time. It was like, it's either Solana or not anyone else. And I think that problem started to be solved now. These immigrant assets like Hype and Zcash are among the most traded assets on chain. So the problem at that time, I think, has kind of been solved. What is the problem now? Perhaps there is, it's gonna get me in trouble, I think. I think there might be an over concentration of attention on a very select number of protocols now.

48:16And I think that it's still very useful to have this kind of like burgeoning middle class of projects that are able to kind of like experiment, fuck around, find out and start to grow. I think right now there's a lot of attention on just a few projects. Jupiter is one of them, for the record, so it benefits the business. But I think that more and more support of that kind of middle class layer is really important. I think Superteam is still doing great work in that regard, but there's much more that can be done to help those guys succeed. What's the right balance? Because I'm thinking about Ethereum, where it's kind of like a...

48:49They have an identity crisis since many years, because there's none of that. There's no attention, or there's nothing pushed. The Solana thing was more, okay, like we try to do something that's where we support and we have this environment for like startup to come and try. But at the same time, it's more Silicon Valley mindset, which is probably because founders come from California. And so they want to push a bunch of things, which make sense. Otherwise, no one knows where the thing is going. What's the right balance? because you're saying today it's too much on a few? I think it's hard to define it in like absolute terms what the right balance is, but it is the kind of thing that you know it when you see it.

49:34When there are net new protocols that are able to grow and kind of like reach new audiences, that ends up being pretty important and like a good signal. So if it is just the same five projects that are the biggest last year and the biggest this year and the biggest next year and the next year after that, that I think is probably not an ideal kind of case. You want to have some kind of turnover. You want to have some new blood. So what you're saying is there might be, we don't know, but there might be like a decision somewhere where they're saying, do we invest more, push more, the ones that are big already because they can become so much bigger and make Solana look good and work better versus we invest more in smaller ones.

50:11And that today, the way it's done for someone new on Solana, it's much harder to like do a zero to one than if there was more help. I think that it's true like in general I think there's plenty of like individual examples where whether it's the foundation or the ecosystem more broadly is supporting like newer builders super team again in particular does a really good job of this but yeah I think that is kind of basically and you have a choice on either extreme it's like hey we're just going all in on one single protocol right and you know you saw some of this happening on twitter kind of recently the other end is like hey we're going to give indiscriminate attention to everyone I think both of those things are bad.

50:47You want to find some happy kind of middle where you're giving some respect to the winners and acknowledging their accomplishments while also supporting some of the up-and-comers, maybe pushing them a little bit more aggressively so that they're able to succeed. What's the thesis for Solana in 2026? It's the everything chain. It's the only chain that keeps on getting better. And I think that's an underrated benefit, right? People do not appreciate just how quickly and rapidly Solana is able to coordinate across a very decentralized kind of network to improve. And that really matters both in the short term and in the long run.

51:21In the short term, it allows you to do things like push these updates that allow us to increase the account size, et cetera. But in the longer run, it's the only way to protect against existential threats like quantum security. That's something that scares me a little bit about Bitcoin, right? Historically, Bitcoin has not had a community that is able to kind of coordinate in order to improve itself. It stays relatively stable. But when there's a threat like quantum, the question is can the community kind of come together to update the tech and make sure that it works. I have no fear of that on Solana.

51:48I know that the community is well-coordinated, committed to a common cause, and is going to be able to kind of move forward. So that level of coordination is very important and allows it to continue to get better at all times. But in the interim, it is the place where tokenized equity trading is actually happening, where real world assets are continuously being added. You're seeing stable coins being sent around faster and faster. And so it is just the chain where you would want to live your on-chain financial life. And that's why I like to call it the everything chain. No other chain really has a credible argument in that direction where it can service the big institutions and the little retail guys, no matter what your need might be.

52:23Solana is the everything chain. It's the place where you want to live your entire financial life.

52:30Let's say that's true and it gets even better and only better from here. Does that mean that Sol, because most people, again, we said before, they want to invest and they want to invest in the right things, but it's difficult today because there's so many assets. Does that mean that Sol does well in the future? I think it should. The way that markets work these days is partially based on fundamentals and partially based on just pure kind of like attention speculation memetics. What Solana is uniquely able to do is continuously grab headlines for major and critically real kind of improvements that are happening, whether that's partnerships with major institutions or net new use cases.

53:18And then on the fundamental side, as I say, the network is getting better. So it has the unique ability both to, you know, you can see the progress in the activity on the chain. You know, I think passing all sorts of records like all the time. And it also has the ability to kind of get the attention. And because it's the everything chain, if tomorrow agentic payments is like the narrative that really matters that everyone cares about, Solana has a really credible argument to be the best chain for that. If instead it's tokenized equities, Solana has a very credible argument there as well because it's able to service everyone to do everything.

53:47And so that gives you this optionality. You're not betting on, oh, privacy is the only thing that matters. You're saying like, hey, you can do privacy on Solana and you can also do X, Y, and Z. And so I think having that scope of that very wide scope of potential ways that Solana can pay off and grab more attention enables it uniquely to be an investable asset. You're the CEO of Jupiter. What is Jupiter today? Jupiter is the on-chain finance super app is the easiest way to say it. It is the best place to trade, earn and use your assets. We have like 18 different products, so it's hard to get. I can get more specific on any one of those.

54:26But the basic idea is anything that you would want to do on chain, you should just use Jupyter to do it. As we mentioned before, a lot of people have been burned in crypto, especially on Solana in the last few years. They probably traded on Jupyter. They probably made great money on Jupyter before losing it all. Hopefully not as much. Trade is a very good business, but not for users. how does jupiter become a place that's good for crypto users and for the crypto space instead of a place where too many get burned and might not come back i do think that there there's this argument that's happening within the industry right now of are we selling cigarettes or are we selling supplements right like are we selling a product that actually ends up killing our users over time uh or are we selling something that actually makes them better over time and the thing that we talk a lot about at jupiter is how to give users an edge and i think an edge in crypto is what allows you to outperform other folks that are in the industry.

55:26And that includes an informational edge. So are we giving you access to the best information as fast as possible, helping you surface opportunities better than anyone else? It's the execution edge. So are your transactions landing? Are the fees reasonable? Are they allowing you to compound wealth very quickly? And critically, the risk management edge. Do you know what you're signing up for? Sometimes providing users this edge actually makes them not want to participate, right? Like if I show you a 20 % yield product, one way I can make sure that you go in and say, hey, it's totally safe. Come on in, no problem.

55:55But that's not what we're trying to do, right? We're trying to give you the edge and say, hey, actually, here's all of the risks, even some risks that you might not have even thought about and see if that allows people to better construct their portfolios and outperform their peers. For us, that comes at a tooling level. So like, what are the products that we're able to build that give users those edges over time? Jupiter has a stable coin called JupUSD. We do, yeah. Powered by Athena. Why Athena? well shout out to guy i think he's like among the best founders uh in the space and it's become a good buddy you know actually we were in the process we were maybe two weeks away from just launching it ourselves without any other kind of support and then i saw some of the stuff athena was doing and the idea kind of arose so we called up guy and we hit it off pretty quickly and it became very clear that there's actually a lot of intricacies to the stablecoin business around you know constant rebalancing and being able to on off ramp etc like there's a stablecoin operations itself is an area where having subject matter expertise really matters.

56:54And Athena, they're the best in the business of this, right? They are building the best next generation stable coin. They have the expertise. Could we have learned it? Possibly. But the industry is moving so fast that I don't have time to learn these things. Rather than spending the two years to figure it out myself, I'd rather just partner with the best in the business and then kind of skip that whole learning curve, benefit from their experience rather than having to learn from my own experience. So that partnership has been very fruitful and we have some bigger things coming as well. Why does Jupiter need a stablecoin?

57:22Stablecoins are uniquely great businesses. And I say this with nothing but love in my heart for Tether and Circle and the other big guys. They're incredibly lucrative businesses, right? Tether is like one of the most profitable businesses in the world per employee. And that's great. They deserve it, right? I had Paolo in your seats and he was saying, was saying oh yeah we because i was asking there was this this rumor about 500 billion valuation yeah yeah i remember that right and he was saying uh it's not about the money it's about sending a message because last year we made 13 billion in profit and the year before two and in this year we're on track to do the same right so yeah it seems to be an interesting business it's like literally the one of the best in human history yeah we've not invented these things and paulo and marco and the rest of the team are absolute killers like i have like an immense amount of respect for them but they are the ones who are able to capture a lot of it and they deserve it again like it's a business they're welcome to run it their own way jupe usd we wanted to make for the people that's the the kind of difference here so jupe usd is not a yield bearing stable coin our lawyers are very clear on me saying that what does that mean so under uh the the Genius Act that went forward in the US government earlier this year or last year, stablecoins cannot generate yield themselves.

58:43I cannot give you yield just for holding the stablecoin. That's not a lot. And so we don't do that because we want to play the game the right way. However, there are underlying economics to JuveUSD because it's backed by T-bills, right? With Athena and BlackRock's Biddle Fund. And we can take those economics and rather than keeping those all for ourselves, we can actually help redistribute that to our users and integrate it across the entire product suite. There are going to be a thousand different stablecoins, and they all have the same problem. Why would I want to use yours? Tether and Circle are integrated everywhere.

59:14There's a very good reason to use them. They've been around for a while. They're very liquid. Every other stablecoin is struggling. The reason that we're going to be able to have success where I think others have not is that we have this full suite of products where the stablecoin actually makes them all better. Here's the easiest example. If you wanted to please the ghost of Warren Buffett, you would DCA into positions rather than just like slamming the market buy, right? Dollar cost average, you're buying soul every week, every month. You're buying Zcash every week, every month, whatever it is.

59:40When you set that up, that capital is laying latent for a long period of time, right? Meaning it's locked. It's locked. And until the next buy triggers, it's just sitting there. It's not doing anything for you. Well, hey, what we can do is put that into JupeUSD. And now I can actually give you yield on your DCA while you are waiting for that order to execute. So that way your wealth is compounding as you're waiting for those orders to trigger. So the reason you can give this yield, it's because it's not the stable coin that gives you the yield, which you would not be allowed to do. Correct. But it's because the product in which the stable coin is used gives the yield.

1:00:19We're able to use the underlying economics and share that back to the users within the Jupyter ecosystem. That's what allows you to earn while you wait. And really, there's two kind of magic words to understand Jupyter. That's vertical integration, right? It's something you see very commonly in other industries. And in Jupyter, it's really the source of a lot of our strength. It's not only do we have the stablecoin, but we have our own lending market. We have our own trading products. We have our own stablecoin spend card. And all of these things work in harmony to allow the Jupyter USD stablecoin to have kind of net new usage and add net new value to the end users.

1:00:53And so that's what it's about. Jupyter USD is for the people. It's the stablecoin that allows you to kind of benefit when you're using other Jupyter products. Which means that for Jupyter to grow, the only way is that Jupyter grows. The best way is that Jupyter grows. Yeah, exactly. You said before, Jupyter is the super app. Everyone is trying to become the super app today. Everyone is doing everything, which a few years ago was different. There were some people doing trading, some people doing yield, some people doing spending. and now basically everyone is trying to build this super app, which means there's probably going to be only a few winners.

1:01:34What makes the difference? Who wins? I do think that the era of do-it-yourself DeFi is over, very clearly. The idea of having those 10 tabs open to manage my finances is not a thing. And so vertical integration in these super apps are going to become by far the most dominant way to do it. The critical definition of who's going to win is what was your initial entry point? Where are you getting the users first? And then how do you cross sell and upsell them across the other products in the stack? And it turns out the main thing that people do on chain is trade. And that's where we started, right?

1:02:05Is like becoming the default trading interface for Solana. And so we have all the users there. They're coming back very regularly. So it's much easier for us to put them in a yield. If you start as a lending market, how often are you checking your lending market position? Not once a week, once every few weeks, maybe, right? You're not going to come back and then also trade there. You're not going to come back and also do prediction markets there, et cetera. So that's one piece is that our beachhead is the best beachhead you could have, which is the most common habitual activity. The other advantage that we have is that we build everything in-house.

1:02:33So the products can actually work very well together. So we now have trading of spot, trading of perps, prediction markets, stablecoin, the extension wallet, portfolio tools, and all the rest that all just kind of compound and make the other products better over time. So because we have the portfolio product, which something like 3 million wallets use every quarter. Those are people who are coming back to that every day, every other day. That's their homepage. Oftentimes, if you're really serious about crypto, that's where you're going to track all your DeFi positions, see your aggregate yield, et cetera, in one place.

1:03:02And directly within that interface, if you have USDC, I show you a little banner that says, hey, by the way, did you know you could go earn 5 %? Click this button, it takes you to Jupiter Lend. And so we have these products that are able to reinforce each other in a way that if you're just doing spot and perps and predictions, you're not going to get that same kind of benefit because you don't have that same kind of habit. one of these products that you integrated is jupiter spend

1:03:28what is jupiter spend well today jupiter spend is the best way to spend your stable coins in the real world with apple pay and google pay it is my belief that stable coins are the gateway drug to crypto oftentimes right for some people it's meme coins and it's these kind of like 100x returns But for the average person, it's stable coins. And so being able to spend those stable coins in the real world and kind of send them all around the world from your bank account in, I think we support 200 different countries now and 22 different currencies, is a big deal and really kind of works well. That's where it's at today.

1:04:02Where it goes from here, though, is what is really, I think, underappreciated by the markets right now, which is you need to KYC in order to use these stable coin cards, right? what we are building is actually this base of KYC users, somewhat uniquely in terms of DeFi, that we can then offer interesting investment products to. So you think about all the RWA assets that are coming on, some of them are permissionless, but many of them are permissioned, right? Because you're actually owning, whether it's a tokenized equity or a share of a tokenized fund, they need to know who the counterparty is.

1:04:31And we're creating this kind of large base of users who are active on chain, who are now going to be able to get access to all these other types of products that are coming on chain in the future. as well. And so this kind of this best of both worlds approach is what you're going to see in Jupiter, where you can be fully DeFi, fully DeFi native, anonymous, et cetera, or you can at KYC in order to use your stable coins, get access to new opportunities, get interesting things in lending that you only see in the traditional world, et cetera. Quick shout out to the legendary team at Jupiter, the DeFi super app.

1:05:02Anything you want to do on chain from trading to earning yield, you can just use Jupyter. Personally, I recommend getting the Jupyter wallet on either your phone or your laptop. 10 times faster and 10 times cheaper than the competition. You're gonna love it. Thank you to the awesome team at Athena for backing today's conversation. Athena is one of the fastest growing projects in DeFi with over$7 billion in stablecoin supply and an average 11 % APY on SUSDE. And importantly, zero DPEGs since launch, which is exactly what you want from a stablecoin. Go check them out by following the link in the description down below.

1:05:41What's some example? What's the advantage for me to go and use Jupyter's pen and get KYC'd versus doing the full DeFi thing? What's an example of like very useful product that I can have only access if I'm KYC'd? A lot of the tokenized funds that are coming on are like this, right? So if you are looking at whatever, you know, the Bailey Gifford fund or some of these others, you have to KYC in order to get access to yields of, call it 7%, 8%. And these are institutional-grade products offered by fund managers that have hundreds of billions of dollars out there. So you talk about risk in DeFi and risk in getting yield.

1:06:19Listen, you should trust Jupyter or Lend, but you know you can definitely trust whatever, JP Morgan or Coinbase or Bailey Kipit or any of these kind of asset issuers that are out there. And so getting access to those yields, I think, is very interesting, particularly for an international audience that does not have a great way to do it. The truth is a lot of tokenized equity plays, you know, you can buy Tesla from India or from whatever, Japan or somewhere else. It's much harder to get access to the credit options in some of those markets. And so being able to get kind of safe, sustainable yield, I think is going to really be attractive to folks.

1:06:52But then that still means that, for example, this fund, well, the fund needs to not blow up, needs to deliver. But I still have my asset in Jupiter. So both Jupiter and the fund need to not blow up for me to not lose my money or to make my money. Correct to a degree. Yeah, it's the way that the Jupiter spend is set up. Like it's a regulated business. Like, you know, others look at it. It's very compliant. It falls through all the strictures that normal kind of custody and stuff like that needs to provide. And so you have some, you can kind of rest a little bit more assured on that side that Jupiter spend is not going to blow up in that way.

1:07:27And then, yeah, you still have the risk. As I said earlier, like if you're getting eight or nine percent, that risk is coming from somewhere. that's kind of priced in. But again, listen, at the end of the day, if you just have stable coins, you want to get 4 % cash back plus, it's a great card to be able to use. Explain GUM, Global Unified Markets, to my mom. To your mom, I would say that it is like a decentralized Binance is the way to do it. A Binance where you're not taking the same kind of counterparty risk that you might with a centralized exchange. Does your mom know Binance? I don't know.

1:07:59She does. Okay, cool. That's good. But it is basically an omni-chain liquidity hub. We're trying to connect. We're trying to solve the primary problem that we see in crypto these days. When Jupyter first started, actually, the problem that it was solving was you'd have to go to Radium or Orca or all these different DEXs in order to trade, and you might get the worst price. So Jupyter as an aggregator allowed you to go one place to get the best price and route it across everything. The new version of that problem is chain fragmentation. You know, Robinhood just launched a chain recently. There's a lot of fun assets on there.

1:08:28Maybe it's on Arbitrum and Solana, et cetera. you want to be able to trade every single asset from every single chain as soon as it is live is the idea and that's what gum enables you to do through a number of like extremely impressive technical innovations as a shout out to seong and the rest of the team on that uh you're able to kind of trade anything from the any of the supported chains right there and then i want to start be seeing every month into robotics with the ticker called bot which we talked about before but I don't want to do this via a traditional broker because most of my money is in crypto, in stable coins.

1:09:05How does Gum help me do this? Gum today, I don't believe, has the limit order functionality or the DCA functionality, but as that comes online, what you'll be able to do is basically buy it from the best pricing on any of the different chains. So on Solana, you get the best pricing across any of the different decks or liquidity sources, Prop AMMs, market makers, etc. With Gum, because it's looking across all the different chains, you'll be able to get the best execution price anywhere that it might live in crypto. So this creates even more competition between the different chains, which is good, right?

1:09:42Competition is good. Yeah, competition is good. Does this exist yet or already somewhere else? There are versions of it. Again, if you kind of squint your eyes, Binance is a version of this, right? Binance supports assets across I don't know how many chains at this point. The major difference, though, is that Binance has a permission listing process, right? Someone has to apply, possibly pay some marketing fees or whatever in order to be tradable on Binance. Versus on GUM, everything is tradable the second it's created. And so that, I think, is a little bit more new than what you'd see in any other kind of major player.

1:10:19What else does GUM enable me to do easily? We are going to have a killer Perps experience on Gum as well. So that's live right now, all in kind of private beta. But we think that Perps is one of the key products that have found product market fit. And there's maybe really only five in crypto that have actually found product market fit. Which are? Say spot trading, Perps, stable coins, capital formation, so like kind of launch pads, and then lending as well. You could argue that prediction markets are getting there. I think that there's still some regulatory headwinds you have to find. So maybe it's five, maybe it's six, but perps is one of the biggest.

1:10:57Certainly from a business perspective, it is the biggest. And now when you have really high-performant perps options, including hyperliquid, you're able to actually use it for the way that a lot of these derivative products were intended, which is to hedge risk elsewhere. So it's not just about going for the 100x long and hoping that you're going to make it rich, but it's, hey, I have this other position. I need to hedge it out. And I want to do it in a capital efficient way. You can use gum perps to be able to do that. which means that this is more something that institutions do. It is. The hedging of risk is something that institutions do.

1:11:28And I think that's where a lot of liquidity will end up coming from, a lot of the trading volumes. So the gum thing of simplifying everything is not just for the average Joe and Jane, but it's for... Yeah. This has been the Jupiter kind of mindset from the beginning, right? It's like, it's a retail friendly architecture, but it's institutional grade tools underneath, right? That is the way that you actually win. You look at like the internet as well, right? The internet itself is not made only for mom and pops, nor is it only made for major businesses. It's made for everybody. The internet kind of helps take all the world's information and organizes it.

1:11:59What does crypto do? It takes all the world's value and organizes it, makes it universally accessible and useful. And that's what we're trying to do with Jupyter and with Gum as well. So you want tools that are good enough that institutions can use them, but also easy enough that any of our friends could use them as well. I will say, early days for Gum. so if people want to try it out you can dm me for a code we'd love to give you access and we need to get the feedback in order to really continue to grow this i kept the best part for the end well let's find out now i'm nervous now i'm nervous there's a thesis that says that if solana and sol do well this cycle it should benefit the tokens of a few of its key infrastructure companies jupiter and meteoro are two of them jito is another one do you subscribe to that thesis I do.

1:12:50Yeah. Well, I think there's many ways in which Jupiter could outperform, but certainly Solana doing well is clearly one of them, right? So you're saying that Solana doing well is not the only reason why Jupiter could do well, or JUP could do well? Correct. I mean, I believe year to date, JUP has actually outperformed Solana as a token. So it's not kind of like pure beta in that sense. And if Solana goes down, then Jupiter goes down more. Jupiter's had quite good price performance this year so far. But yes, I do think that's that Solana will do well. And I think as a consequence, Jupiter will do well.

1:13:21And the reason is somewhat mechanical, right? More people using Solana. If you're using Solana, you're almost certainly going to end up using Jupiter. We're the primary trading destination. We're number one by TVL. We have all the products that you would want to use. We have the best wallets. And so you're going to end up using Jupiter anyway. So as more users come on, as more liquidity comes on, as more trading value comes on, that all directly benefits Jupiter. And so, yeah, if there's more happening on Solana, that means that there's more happening on Jupyter as well. But if there is more happening on Solana or not, and there's more happening on Jupyter, how does that directly benefit Jupyter?

1:13:54Again, you look at it both from a fundamentals perspective and the kind of memetic perspective. On the fundamental side, 50 % of Jupyter's revenues right now go into buybacks of the Jupyter token. So there's this kind of like direct correlation or alignment, we might say, between kind of the token holders and the business itself. But also on the kind of memetic side, right, as more people are paying attention to on-chain finance and more people are thinking about interesting ways for on-chain finance to grow, they're going to look at Jupiter and say like, ah, isn't it interesting that Jupiter is doing so much of the volume on tokenized equities?

1:14:24Isn't it interesting that Jupiter has one of the biggest lending markets that is out there? Isn't it interesting that they're innovating on prediction markets and so on? And so I think that you kind of get the best of both worlds. Just more attention comes, naturally, Jupiter is going to be able to benefit. And then as the business continues to grow, Jupyter continues to benefit as well.

1:14:45Why did the Jup token, the token of Jupyter, one of the main infrastructure players on Solana, did not do well last cycle when Sol was the best performing asset in the majors? And I can make the same argument for the other key infrastructure protocols on Solana. And I would argue on Ethereum too. Yeah. At the time, I think there was a lot more belief in this kind of fat protocol thesis that value would disproportionately accrue to the protocols and that the apps would be able to capture a very thin amount of that. It does seem just from talking to other investors that that's starting to shift and people are getting more and more bullish on applications themselves.

1:15:28I will say that all price, you can kind of think of like the narrative pyramid, right? where the base level of the pyramid that determines if things are bullish or bearish is macro, right? Ultimately, if NVIDIA drops 80 % tomorrow, we're all in trouble. Let's just be honest, Jensen's got to stay healthy, right? Or President Trump's actions on tariffs or this, that, the other, like those matter to crypto prices, right? So there's this kind of macro level here. Then the next level is the kind of ecosystem level, right? So as Solana, when Solana was doing less well, people were naturally a little bit less excited about Solana tokens overall.

1:16:00And then there's the kind of category that you're in. So Solana DeFi in particular took a bit of a beating. And that's not just for Jupiter, it's for all the DeFi tokens. And then there's your project at the top of it and the specific things that you're doing. So, you know, when Solana was pumping, Jupiter was doing great. When Solana was going down, a few levels of that pyramid kind of worked against us. But I think we also made plenty of mistakes ourselves, I should be honest, right? We kind of overemphasized DAO politics. We have the largest and most active DAO in crypto and it's something we're proud of.

1:16:27But I would argue that we spent a little bit too much time talking about politics and not enough time talking about product. That was a real mistake. I think we didn't kind of make the effort to treat Jupe the Token as a product itself. You know, with our products, we talk to users. We're iterating very quickly. We're being as active on the strategy. We're trying to understand the competitive landscape. With Jupe the Token, a lot of the time, we just kind of hoped that it would go up. We were like, hey, we're doing great work. People will recognize it. And then the token will go up. Therefore, yeah.

1:16:53And I think that I did a tweet about this a little while ago, and I got to reach outreach for a bunch of founders who were like, that's exactly how we're thinking about it now as well. That success does not just naturally ensue because the protocol is doing well. You got to take the token itself seriously. You got to talk to the token holders. You got to get out there and tell the story and help people understand in this very saturated market why you are different, why you are actually going to be able to have long-term success. And so we started to make some of those changes, and I think they're already starting to pay off.

1:17:21what are some concrete changes you've made to make sure or to optimize or maximize the chances of standing out in these infinite assets yeah which is a problem by the way because it used to be in the beginning we have a bunch of cryptos going up like crazy then we have too many cryptos which means that it's so it's more and more difficult even if you have a really good business to perform well because attention goes from one to another to another. Now it's not only too many cryptos, but it's going to be too many assets. Yeah, it's true. We're going from easy mode to hard mode, right? The thing about hard mode is that it is more difficult to win, right?

1:18:03The size of the mountain that you had to scale in order to be successful in crypto just continues to get taller and taller and taller. The way that we're able to differentiate is making very clear to the market that we have a long-term potential or a long-term vision. We are not in this from a cycle to cycle playbook. We're looking at decade on decade. The clearest and best example of this is Meow, our mutual friend. He locked up all of his tokens. He's the co-founder of the protocol. He's not getting a single token until 2030, right? So he's not in it for short-term gains. He's not in it after these kind of things.

1:18:32And the same is true for many other team members, that they've kind of deferred their own personal value as a way to signal to the market that we're serious about building something long-term and actually making an impact on finance. That's part of it. The other part of it is having a story, going out, getting the right people there to help tell that story. Shout out to Xiao Xiao, who's on your podcast as well, comes from KKR, led digital assets there, is now in the conference circuit, talking to funds, making sure that people understand why this is a differentiated asset. And then honestly, finally, it's just a matter of like taking it seriously, talking to token holders regularly, setting up those kind of groups, taking input from them and better understanding, you know, what they'd like to see us do.

1:19:14Transparency side, utility side and so on.

1:19:22Jupiter is an amazing business. Should we be bullish on the JIP token? Yes. Why? The answer is, I think that in the long run, we're seeing increasingly returns to quality, right? There's that old idea that like in the short run, the stock market is a beauty pageant. In the long run, it's a weighing machine. And as markets mature, you see more and more of that kind of activity happen where people are actually doing the deep dives. Critically, the investor base itself is changing dramatically. We are moving from a world where it is primarily 20-somethings investing to a world where there are billion-dollar asset managers who are investing.

1:20:04And the language and the mental heuristics that they have in evaluating tokens is itself changing. And so the idea of having a non-existent business but a great Twitter presence and that leads to your token outperforming, I think will continue to decrease as the blend of investors becomes more and more sophisticated. it. And if you do believe that Jupiter has a great business with great growth prospects and represents this kind of diversified play across all of on-chain finance, it's pretty easy to start to get bullish on it. And again, you can just talk to a lot of the funds. They'll tell you that the same is true.

1:20:38If I was a fly on the wall, when you talk to Meow, the Jupiter office in KL or in Singapore, where we're right now, What do I hear? What would I hear when you guys talk about a company like Hyperliquid? You would hear, I think, a lot of respect, first and foremost, I think, for what Jeff and the rest of the team have done, especially how small that team is. You would hear us thinking about ways that we can kind of differentiate ourselves and what we might be able to bring to bear. And you would hear, I think, about the ways in which, from a product perspective, we might be able to improve on what they've done.

1:21:19right they are a great product company we consider ourselves to be the best product company in the space we've shown that kind of in bits and phases in particular places and i think gum is really the the next opportunity to show that on a on a larger scale that is more similar to hyperliquid itself but again it starts it starts with respect what do you think they've done differently to become so big in terms of mind share and trust and have all these like non-crypto people talk about them. I had some people recently reaching out on behalf of some partners of mega hedge fund in the US to ask me for a couple of hours to talk about Hyper liquid.

1:22:12Hmm. I think that is interesting to hear. I think your podcast with Jeff was indeed, as I say, one of the better ones out there. I think that they've done two things particularly well. The first one may have been intentional, may not have been, which was their token airdrop, right? They did a very concentrated token airdrop that made a relatively small number of people extremely wealthy. And the fastest way to build a community in this space is to make people rich. And they did a great job of that. And I think that part of that was just kind of like the timing of where the market was and where their users were.

1:22:43Part of it was the design of their tokenomics, I think, was really quite strong. They had the benefit of kind of seeing a lot of other tokens, including Jupe and kind of how we did things. Jupiter, in contrast, did an extremely wide airdrop, right? So I think in the first airdrop, we did something like a million wallets. In the second, we did about two million, if I'm not mistaken. So they did a very narrow airdrop. And I think that really worked out very well for them. The second is that they've been able to figure out how to work with others really well. So with, you know, Choco and TradeXYZ as one example, they appreciate, as we do, that collaboration is oftentimes more effective than pure competition.

1:23:15That's why we work with Athena on the stablecoin, we work with Fluid on JupyterLend, we're working with CollectorCrypt on our new gotcha product, etc. And so it's the spirit of collaboration that I think has served them very well. What's the one thing that people should remember from today's conversation? That on-chain finance is not a fad. in the last bull cycle or the last bear market, I had some worries. Like, where are we going to come back or not? Right after FTX went down. I was like, maybe this is kind of game over for a little while. That is no longer possible. Bitcoin has something like 100 % mindshare in the world.

1:23:51Everybody knows what it is. Every major institution has an on-chain finance strategy. Every, I think, individual who is in the industry can feel how rapidly it is getting better from a product and usability perspective. And I no longer have any fear that this industry will go away. Now the only question is, how big will it get and how fast? And I think the answer is very big, faster than anyone's expected. I was about to say, what's the answer? Well, you just gave us the answer. Thank you so much, Cash, for doing that. That was amazing. And that's exactly the kind of conversation I want to have with people who say, hey, look, like all the narrative out there is wrong.

1:24:28We're still super early. There's still a lot of opportunities. It's time to double down, stay in the industry instead of leaving and be very optimistic. That was awesome. It's a lot of fun, buddy. Thanks for having me as always. Nice. As you probably know by now, I host some of the biggest names in Bitcoin and crypto on my podcast. But a lot of the best stuff never makes it on air. The Shift newsletter is where I share that raw behind the scene alpha, the insights, stories, and lessons straight from my guests that you won't hear anywhere else. If you want the real insight take on Bitcoin and crypto, join my newsletter, The Shift, in the description down below.