Speaker A
Actually, Mr. Luben, I'm not sure there are tens of thousands of Robin Hoods out there. In fact, there may only be one or two, and if they're each paying 1,500 bucks a week to Ethereum, I don't think that's going to pump anyone's bags. Is
Discussion on Europe's Digital Euro, Robinhood's rise, and crypto market bottoming signals with expert insights and market updates.
Key Takeaways
- Bitcoin's SOPR dropping below 1 is a strong indicator of a market bottom or capitulation phase.
- Crypto market sentiment is improving but lacks urgency, suggesting cautious optimism.
- Robinhood chain's volume growth is driven largely by meme tokens, raising questions about sustainability.
- The Digital Euro and other CBDCs may introduce unprecedented surveillance and control over digital transactions.
- A potential market dip in late 2024 could coincide with broader stock market corrections.
What the video covers
- The video opens with skepticism about the number of active Robinhood users and their impact on Ethereum.
- Market update covers rising US yields, geopolitical tensions, and mixed stock market performance.
- Bitcoin shows a relief rally, while altcoins remain mostly stagnant except for meme tokens on Robinhood chain.
- Detailed explanation of the SOPR metric indicating Bitcoin sellers are now realizing losses, a potential bottoming signal.
- Crypto Twitter sentiment is shifting from bearish to neutral or bullish, suggesting a nearing market bottom.
- Discussion on the painful crypto market conditions, including hacks, scams, and token value declines.
- Speculation of a possible lower low in Q4 2024, potentially triggered by a stock market correction.
- Tom Lee's critique of the value accrual thesis for Ethereum and other assets is examined.
- Robinhood chain's rapid growth and its sustainability are analyzed, noting a large share of meme token activity.
- The video touches on the implications of CBDCs like the Digital Euro and their Orwellian surveillance potential.
Chapters
- 00:00Introduction and Robinhood User Skepticism
- 03:41Bitcoin SOPR Metric and Market Bottom Signals
- 06:24Crypto Twitter Sentiment and Market Outlook
- 08:56Market Pain Points and Potential Future Dips
- 11:56Tom Lee's Critique of Value Accrual Thesis
- 14:56Robinhood Chain Growth and Meme Token Activity
- 18:46Implications of Digital Euro and CBDCs
- 23:06Closing Thoughts and Market Summary
Full Transcript — Download SRT & Markdown
Speaker A
the dunk on Ethereum complete? Have we broken the backboard? They're passing all these chat controls and other like panopticon pieces of technology. This is going to be traced and monitored and run through their databases and checked to see if you've ever said anything that
Speaker A
doesn't meet their exacting standards through your state-sponsored social media app. It's almost like Orwellian that they would say that. [music] This is cash-like, right? Like, it's antithetical to cash. I think a CBDC
Speaker A
We're live. Welcome back to another episode of Token Narratives. I'm Graham Stone, joined again by David Sensil and Alex Richardson. How you doing, gentlemen?
Speaker A
Doing well. Living the dream. All right, so let's start off with a little market update. There is an underlying air of fear and uncertainty in the markets currently as US yields continue to skyrocket. So you've got the
Speaker A
2-year, 5-year, 10-year, and 30-year yields all surging as confusion, I think, around the conflict in the Strait of Hormuz intensifies. Oil is back to above 80. Stock markets are sideways so far in the week with the S&P 500 up slightly while the Nasdaq and Dow
Speaker A
are both marginally in the red. Bitcoin has, over the last day or so, seen a little relief rally, now up about 10% off the yearly lows, trading at the time of recording around 65K.
Speaker A
In altcoin land, nothing really happening other than meme token debauchery on Robin Hood chain. We're going to get into that a little bit in this episode, focusing on the question of whether crypto has bottomed, the perennial question. We're going to
Speaker A
get into that right now for a little bit. So, there was some commentary from Alex Thorne, who is the head of research at Galaxy, and he issued a bottoming scorecard, and it's filling out the sort of the metrics
Speaker A
that he's watching for whether we have hit the bottom. More and more of them are getting ticked off, and the latest one is the so-called SOPR, spent output profit ratio, and that has dropped to 0.97. Now, what is that exactly? I looked
Speaker A
it up. Some of you may be following this metric closely, but let me explain it. It's one of the most widely watched metrics for on-chain Bitcoin analysis because it tells you whether coins being spent on the network are on
Speaker A
average being sold at a profit or loss. And so the formula is essentially you take the price when coins are spent and you divide that by the price when those coins were last moved. So if the SOPR is
Speaker A
greater than one, it means that sellers on average are realizing a profit. And if it's one, it's break even. If it's less than one, most sellers, when they're selling, are realizing a loss. And so we just broke under one. So that means
Speaker A
it's kind of a, I guess you could call it a capitulation sign. People who were previously in profit are like, "All right, I can't handle the pain anymore.
Speaker A
I'm out, selling at a loss." And typically, or historically, when that happens, it's another sign that you've kind of hit the bottom. So, it is what it is. Any follow-ups there on that or other bottom signals?
Speaker A
I have some other less data-based signals, but I still think they are actually important. More and more on CT, the people that I follow are becoming either neutral or bullish. And so to me, that is a sign that we're
Speaker A
probably getting close to or at the bottom. Most recently, even just this morning, I saw it. I put it in our chat for the newsletter, the Flowhorse, right? Great trader. He said, I think for the first time in like a
Speaker A
couple years, was saying like, yeah, starting to look at certain coins in the market. I'm going to take a break for the summer, but I'm going to have my eye out for things, and I basically
Speaker A
intimated like this is it, but no real sense of urgency it seems from that guy.
Speaker A
Yeah. Yeah, but just follow up that your list of CT crypto Twitter personalities is probably the most highly curated one that I've, that I know of. Mine is admittedly has a lot of slop on it. So,
Speaker A
when you notice this, I think that does carry some weight. I would just add that. Go ahead.
Speaker A
Yeah. And especially with these people, like what I often do is when they're wrong, and often when they're very wrong, I just kind of unfollow, call them from the list.
Speaker A
Yeah. No, seriously. Straight up. Because, and so there's like three or four, I again, I'll probably specify them by name and link to their actual posts for the newsletter that I'm starting to write now. But
Speaker A
there's been like three or four this week or last week, right? I think I mentioned last week like American—sorry, sorry, not American Psycho, Altcoin Psycho, he has gotten constructive, and yeah, Horse has gotten constructive. There's a
Speaker A
couple others who are there too, and so that to me is a real sign. Now again, like you said, Graham, no sense of urgency really, but probably the next four to six weeks, the next four to eight
Speaker A
weeks, this is when you should be kind of dabbling in the things that you think are going to perform well in the next bull market. So yeah, that's kind of where I am. Although I've
Speaker A
been saying that ever since I got back from traveling a month ago. So no updates in terms of no one should be surprised how I feel about that.
Speaker A
Yeah, I think that the tourists are gone, right? We've gone through a lot of pain. We've got the hacks and the DPRK and the president scamming us all and all the altcoin charts going to zero and the sobering realization of token value,
Speaker A
a cruel thesis. It's been very painful, and I just can't imagine there's any tourists here. Like, I have wallets with coins in them that I've just forgotten about, and it's not even worth the gas fee to sell because I'm down
Speaker A
so much. So if the tourists are gone and the crypto natives are down so bad that they don't want to sell, then I can't imagine who's left to sell at this point beyond one last little puke
Speaker A
into the latter half of this year. I don't want to sound like a broken record, and I know I've said this like every episode, but I still think we got one little lower low in Q4
Speaker A
later this year, probably catalyzed by a stock market correction. On a small short tangent to this, Alex, because you mentioned the value accrual thesis, I don't know if you guys saw this, but Tom Lee in a recent interview was
Speaker A
directly talking about the kind of validity of this value accrual thesis because it kind of contrasts directly with the value, like why should Ethereum, ETH, Ether, the asset go? Did you see this? This clip, Tom Lee is throwing shade on the
Speaker A
whole concept that—yes, surprise, surprise, isn't it? But it's like, it's so funny though. He's like, well, you know, I've been trading equities for my whole career, 30 plus years. And let me tell you, the stock market has gone up quite a
Speaker A
lot, and it's not because the value, there's been value accruing to these things. And so anyway, I want to get into, like, check the facts on this a little bit, but I was just kind of laughing. I was like, well, he's basically saying everything is a Ponzi, I guess. I don't know what the point of his thing was, so it was kind of funny.
Speaker A
Yeah. Yeah. He said the quiet part out loud, it seems. Crypto, stocks, commodities. [music] One app. Trade Bitcoin and crypto, trade Apple and Tesla. Trade gold, oil, [music] and everything in between. Up to 40 times leverage, low fees, fast
Speaker A
execution, no signups, no surveillance, no limits. Orange Rock, trade without limits. So, just lingering for a moment on
Speaker A
Yeah, like bottom signals, David, because you were just at this conference in Tokyo and Alex, you made the
Speaker A
point that like there's the
Speaker A
guess you could call them, there were a lot of them there. And that seems I'm not like you you said in the pre-show, you don't know how to think about that fact that that it was like crammed with
Speaker A
retail this event. Yeah, it was I would say yeah it was a very strange like I was saying so uh this entire year been going to conferences a lot of conferences and at the conferences sentiment was high but it was just filled with everybody
Speaker A
like wearing suits. Uh it's all kind of businesses, institutions, people kind of outside of crypto who are excited now to to be in crypto. It's kind of like they have they're coming in with like they're not jaded, you know, and they see the
Speaker A
opportunity. And uh that that has contrasted very very much with sentiment on CT, crypto Twitter, where it's full of crypto natives who've been burnt, who have been down only, who are bag holders of all these, you know, [ __ ] tier
Speaker A
projects, including your favorite alt L1, you know, let put that name in in your mind now. And so then I I thought this conference would be the same, right? I thought it'll be it'll be there'll be less pop in circumstance.
Speaker A
Boos will be a little smaller. It'll be it'll be more restrained. That was true.
Speaker A
Yes. But I also thought there would be way less people and then the people that you would see would be similar to the compositions of other conferences where there lots of suits and the the people who are excited to be there are kind of
Speaker A
from from Tradfi. And yeah, there was a ton of retail. I would say compared to last year, Graham, you were at WebEx last year. I think it was it was more crowded than last year. Uh so for the
Speaker A
whole entire two days, it was kind of annoying actually to have to go meet people if you had to when you had to go to the retail site. I was like, "Ah, I got to go to the man." It's like pushing
Speaker A
through crowds of mouth breathers who are trying to win little plushies from I'm a mouth breather. But yeah, you know what I'm talking about. It was just kind of annoying, you know, going to stay away from the plebs. Um was pining. I
Speaker A
was pining for people in suits. Everybody's wearing like shorts and flip-flops and heard lots of lots of people uh fighting over their place in line. Some of the lines were crazy, too.
Speaker A
They were they were fighting over the the the level of free merch was it pald in comparison to last year, right?
Speaker A
Because we're in a bare market. And yet and yet they seemed this year to be even more enthusiastic about trying to get the the the crap tier merch. Now, what does this mean? Like I was trying to square this in my mind, right? Like,
Speaker A
okay, slightly reduced size, reduced kind of niceness of the booths and everything like that. Merch is less uh but maybe even more crowded. I I don't know if that's uh if it might just be a sign about Japan because as we talked
Speaker A
about last year, Graham, uh a lot of the outside investors outside of Japan saw an opportunity opportunity in Japan.
Speaker A
And I think that has only become more consensus now. It's still out of consensus now. I I I had several interviews and people were kind of trying to hide their enthusiasm because they they think that they're still early
Speaker A
to this idea that Japan could could be might be very very important in the next bull market for crypto assets because Japan has so much has so many like fixed income RWA like like opportunities for like tokenization and Japan is
Speaker A
institutionally led and so these when these slowm moving Japanese institutions are starting to really push into crypto that kind of pulls in the Japanese retail just slightly different than other Asian countries. So could it just be like kind of a idiosyncratic
Speaker A
Japan-only phenomena or could it just be a sign that the whiffs of the bull market are starting everywhere? I I still haven't kind of wrapped my head around it but that's that's where I'm thinking about it right now. My guess is
Speaker A
it's probably a little bit of both. And wouldn't it be interesting if this bull market in some ways was kicked off or catalyzed by the Japanese retail, which really hasn't been present since 2017 when they got mega burned by the ICOs,
Speaker A
right? They kind of they sat out I I tal I talked to several people. They're like Japan sat out 2020, right? The DeFi summer. They sat out 2024, like the pre 2023 2024, that bull market. So they the the retail in Japan
Speaker A
has been been out of it since 17 almost 10 years. And so maybe they're uh yeah they're sensing that there could be opportunity here as uh you know like perhaps you know the uh the trady or AI trade starts
Speaker A
to dwindle opportunities things start to become topsyturvy there. They're like, "Okay, uh, maybe now is the time to be paying attention to crypto. Hence, let's go see what's happening at this conference." Yeah. And, you know, that's kind of what crypto needs is is that
Speaker A
like it needs that fresh meat to put money into the space. This is been a market that hasn't really deployed capital in crypto for so long. So, they might be willing to do so. God, I hope they don't get burned again. That's the
Speaker A
last thing we need. I personally don't like this memecoin renaissance in quotation marks because it's so I I hope that they stay away from that. My hope is that the big institutions that were present at WebEx kind of like push push the Japanese
Speaker A
retail into you know fixed income yielding instruments that that don't have the that are not going to like blow them up and so you don't you don't like sour a whole new cohort to crypto as a as just a scam. But anyway,
Speaker A
yeah, I I think that is promising. I mean, Japan still hasn't resolved its crypto taxation issue. So, you know, if you actually do do well by buying cryptocurrencies, you're going to get half your money taken away if you ever
Speaker A
try to sell it. While while if there are sort of crypto linked fixed income type instruments like ETFs or whatever, those are more favorably taxed. So, you could see that that there being opportunity there. All right, let's move on to a
Speaker A
juicy topic, which is Europe. The the dying the dying continent. No. Well, I want to call it what's happening in Europe. The construction of a giant mouse trap where yeah, money comes in can never come out. And anyway,
Speaker A
so what's h what happened recently in Europe? The ECB, the European Central Bank, the the latest news is that they've selected 36 payment service providers for a 12-month digital euro pilot, and that will begin in the second half of next year. So, the the project
Speaker A
will test payments, account setup, merchant acceptance, and offline functionality using a beta version of the digital euro. some details. I mean, it's being pitched as kind of a Yeah.
Speaker A
digital cash. So, or electronic cash. They're saying it's going to enshrine privacy. It's going to be closer Yeah. closer to cash than a bank deposit.
Speaker A
There will be a separation of the wallet and payment infrastructure. So users would get a wallet through a bank, post office, or some other payment provider and then fund it from a bank account or possibly with cash. Banks would still
Speaker A
handle customer service, identity checks and wallet access, but the underlying money would be issued by the Euro system. Supposed to work across the entire Euro region. Could potentially be configured to work offline. Not sure exactly how that would work, but that's
Speaker A
something that's being suggested. And uh yeah, payments would settle instantly in this central bank money.
Speaker A
So, you know, like uh as everyone knows, when you pay with a card, it looks instantaneous to you, but in the back background, banks, card networks, and merchants settle that transaction significantly later, and that leads to a lot of costs and inefficiencies. this
Speaker A
this would be instant including re the merchants being able to receive the the payment instantly and uh yeah there are there's yeah go ahead I was just last point there's talk of a a 3,000 euro limit per person who knows what that
Speaker A
exactly means per we're going to limit your we're going to limit how much cash you can hold to 3,000 something like that yeah that's not dystopian at all I was just going So that's yeah that's an overview of what what's
Speaker A
uh being proposed here the latest Euro CBDC project David you're shaking your head I think this is very interesting to discuss this is a great thing to discuss because it brings in you know a lot of the issues
Speaker A
that we always talk about in Bitcoin and then you know like I I there it's this on on the face of it, this thing, this project that they're rolling out. Maybe it doesn't seem that bad, but to me it's like just
Speaker A
another piece of the puzzle, another pillar of this giant mouse trap that Europe is building. And you know, there's other elements to it like the chat controls. The mo most recent thing was uh the like basically spying on you
Speaker A
in your car to make sure you're not you're paying attention to the road. You have to like KYC yourself to get into a car basically. Yeah. Yeah. I know. I just I just I have a couple I have like
Speaker A
one or two small like uh comments and then I spoke with several people about or this came up at the conference. So I have like a point related to that. But first who who you cannot trust these sociopaths, right? Saying saying things
Speaker A
like this is this is closer closer to cash. This is closer to cash. We're not spying on you. This is private. It's closer to cash. You How How can you believe that? And in the the same time they're passing all these chat controls
Speaker A
and other like panopticon pieces of of technology that you you absolutely have to to disregard that this is anything cashlike at all, right? like completely this is this is going to be traced and monitored and run through their databases and
Speaker A
checked to see if you've ever said anything that that doesn't meet their exacting standards through through your your state sponsored social media app.
Speaker A
[clears throat and cough] I I uh I absolutely I think I think it's it's like Orwellian that they would say that this is cashlike, right? Like a it's it's like antithetical to cash. I think of CBDC. I So it's it's just double speak, right?
Speaker A
It's it's just the exact opposite. I I think personally so that to me kind of gives me goosebumps in in a very bad way. It's like gez, we're getting we're entering into this kind of very very scary world. Now the other part of it is
Speaker A
the more interesting thing that I'll talk about. I'll let Alex give his initial thoughts, but I just want to set it up is how this how this relates to the stable coin race, right? Obviously, US dollar denominated stable coins are
Speaker A
number one. No one thinks that they won't be number one, but there is a race for number two or number three. and how this idiotic idea that they're doing or thing this program pilot kind of makes them pre-l before they've even really
Speaker A
entered the race. But anyway, Alex, I'll let you give your thoughts on on what what Graham said. I mean, Europe and the EU are doing what every bankrupting government has done in the past, which is increase surveillance and taxes and
Speaker A
various forms of control because they Europe has created the biggest welfare state in the world and they're slowly running out of revenue compared to how much that it costs to run and their birth rate is low and their only
Speaker A
solution so far is importing strange men from underdeveloped countries and it's not going to work for very much longer and so their only option is just more more taxes and more controls and and more inflation. And I think I think
Speaker A
that's generally the reason why they all of a sudden care so much about a digital euro instead of just allowing the private sector to to to handle that the way that the US has handled it with private companies. Europe has regulated
Speaker A
regulated all these companies to death and decide to do it themselves. And I I hope that it's I hope that it like serves as a warning to to the to Americans and Canadians about how how bad things can get. Like I know Europore
Speaker A
is like a meme, but I don't think I don't think people have uh any idea like how bad it can get. Like if Americans are complaining about surveillance and restrictions on freedom of speech and taxes now, like go go spend some time in
Speaker A
Europe and then come back and talk to me. Like there's just so many it it's so much worse there. They're like 30 years ahead. And and you you hear these like these people romanticize so many things about Europe, but it's really just a
Speaker A
misinterpretation of poverty. They'll be like, "Oh, these I think it's so cool that people in Spain will like spend all night talking with their friends and they're so easygoing and living in the moment." But really, it's like, yeah,
Speaker A
they're they're they're spending all day talking cuz they're unemployed. They spend all day in cafes cuz their house is so small and prison-like that if they stay home then they'll die of heat stroke because there's no AC and they
Speaker A
have no oven. Like try to find an airbnb with an oven in in Malaga or these other Spanish cities. Like it it's it's really bad. And David, you did an interview with Sarah Nafo, the this French politician about a month month or two ago and it's
Speaker A
really good. I recommend everyone checking out checking it out. She warned about Europe becoming like a digital colony of the US. And it's true. Like, you got Europeans walking around with iPhones, connected via T-Mobile, and they're using Apple Pay to pay for their
Speaker A
Netflix subscription so that they can watch an American show. It truly is like an American colony because American companies are creating stuff that people actually want in Europe.
Speaker A
Well, Alex, and all the all the European gone. So I just interrupt with you on that because more importantly, Miss Miss Kafo said the French government, the German government, they're using they're using all of their data service platforms for
Speaker A
their government are like goo Google Drive, right? And like you know, Gmail, there's no like there's no freaking like French email service provider, right?
Speaker A
So, so like the government and all their government secrets in their military are they have subscriptions to freaking Google which is hilarious, right? So, yeah.
Speaker A
Already completely compromised. Yeah. I mean like the government, their own government. How how how kind of uh inept and maybe kind of powerless you must you be to to to have like even your national security, your sovereignty is
Speaker A
kind of at the is is is at the the uh the whims of a an American company.
Speaker A
Pretty wild. Say what you will about China, but their government is like, "No, no, no, no. We're going to make clones and copies of all of this and we'll just call it it's not Gmail. It's way mail. Well, fine. But at least they
Speaker A
have their own version, right? And the servers and the company are under their direct jurisdiction. So that that to me is like the real kind of like the thing that I hadn't thought of is like dag man, your own government doesn't even
Speaker A
own own the services that they when they when they make word documents. They're they're doing it on like Google Docs.
Speaker A
It's hilarious. So, I I will say though that Graham, I I think I heard the sound of of our two or three Spanish subscribers unfollowing us as Alex accurately told the situation there in Spain.
Speaker A
I've spent almost a year of my life in Spain and Spaniards are like the greatest people you'll meet. It's a fantastic civilization and culture. But yeah, like the Western Europe is now like a third world economy living in the
Speaker A
ruins of a once great civilization. And I think there's definitely a geopolitical reason behind the creation of a digital euro for the reasons that we already talked about like if they're going to be if they're going to be colonized
Speaker A
economically and digitally by the US and to a certain extent China now that China is sending a lot of cars and other industrial output into Europe, then they they need to at least surveil and tax it. and it makes more sense to sort of
Speaker A
centralize it to the to the ECB rather than having all of these private banks control things that that that the governments can't watch as closely.
Speaker A
Yeah. to kind of to this point, sorry Graham, just a funny little little anecdote to this point about like Europe Europe failing after the Argentina England game, soccer game this this morning, a finance person that I I respect very much who was in the 2008
Speaker A
financial crisis uh movie, The Big Short, like he was he was working with with those people. He wrote this uh and he's European, sorry, so this is a European talking about it. He wrote this post. Our Argentina and England summary.
Speaker A
The country that got bailed out by the IMF defeated the country that will get bailed out by the IMF. Meaning England is on that that third world path.
Speaker A
They're they're on the they're that's their trajectory, right? Yeah. And uh just looking at the big picture, right?
Speaker A
Do you guys remember what happened in Cyprus? Uh this is like one of the first big events that uh kind of put Bitcoin on the map because basically their banks failed and uh people just got locked out of their money. And at that time what
Speaker A
happened was in Europe uh and other countries, Canada included, the legislators basically were went like, "Yeah, uh that's the playbook. So, we're going to we're going to write laws that make it so that next time there's a a financial crisis like that, we're
Speaker A
going to just do the same thing, which is basically uh we're going to take a haircut on on all your deposits. Uh you're not going to be able to like people in Cyprus months they couldn't take money out. They were uh and people
Speaker A
ended up just having like a significant portion of their savings confiscated effectually effectively to save the banking system. And I think that's the direction that this is all going. Things like the this uh CBDC just make it easier for them to to pull that off in
Speaker A
the end. And yeah, the the solution is nonstate money. Well, I mean it depends on what you mean exactly by non-state money as in like stable coins are arguably private money or quasi private money or then you have like pure purely
Speaker A
digital assets something like uh bitcoin but I don't think that's money like really right it's more of a store of value but on on the stable coin aspect of this the the I think the real kind of the the head scratcher for this is
Speaker A
Europe is also at the same time the EU the the government and and the ECB.
Speaker A
They're also trying to kind of promote facilitate a euro denominated stable coin, right? So, they're they're trying to do both. They're trying to do a digital dollar, sorry, a digital euro, right? This CBDC, and also get people to
Speaker A
get private companies to create euro denominated stable coins. It's like what what are you doing? You're like making a competitor to yourself, right? Why? I don't it it just seems kind of ridiculous to me like choose choose one
Speaker A
or the other really, right? Don't you think? Uh and so here in Japan there is a yen denominated stable coin. It's out already. Um it's it's starting to I guess get traction and whatnot. And I did I did some interviews. One of them
Speaker A
was with Tun from the Shopping Block. Really good interview. I've now interviewed two people from the shopping block. So that's awesome. one of my favorite podcasts. Anyway, he uh he had a very interesting take on this, which is he thinks that the there'll be like
Speaker A
one maybe two stable coin winners, right? It won't just be one. It won't just be the dollar, but there'll be like a second or third and then it'll just be like a long tail of other of other stable coins. And so, right now, the
Speaker A
dollar has kind of won that. Nobody really disagrees with that. So, the dollar will take up most of it. But he's all he's now looking for like well what's going to be the second most popular uh stable coin as in like like
Speaker A
kind of stable coin and he thinks the the euro is done because of this because of this kind of like built-in infighting and so euro denominated stable coin will will not be the second place probably not even the third place and his bet is
Speaker A
the yen right his bet is the yen as the second biggest stable coin and he's trying positioned himself and his company and whatnot to to kind of capture his his his his bet on this. So, I thought that was really interesting
Speaker A
because up until that point, I had kind of thought like, oh, well, the Euro Europe big market. Euro denom stable coin seems like a no-brainer. But he was like, no, no, no. Europe doesn't know what it's doing. They're trying to like
Speaker A
kill it and attack it and com compete against it. No, I I think it's going to be the yen. So, there you go. Europe, what are you doing, man? So yeah, I thought that was pretty interesting and I yeah, I kind of think he's right about
Speaker A
Europe. The yen as the second one, I guess. Yeah, it should be right. The yen is is a very very important currency. I asked him about like the the weakening weakening of the yen. And he was like, "Yeah, but what else is
Speaker A
there?" And there's still so much wealth and assets, what's it called? Real world assets kind of locked up in Japan. uh it's very very very important. So there you go.
Speaker A
My uh anecdotal experience is that most people in uh Eastern Europe agree with that David is they they don't want to they don't want to join the Euro and and make it stronger. it they associate the euro with like Davos and all of the woke
Speaker A
stuff in Western Europe and it like you said there's there's built-in infighting and so I yeah I don't know necessarily if the yen is the next big thing or the yuan or whatever but yeah I totally agree with the I'm I'm generally like
Speaker A
pessimistic and skeptical of the the future of Europe the euro and like European digital finance I guess like a European stable coin challenging USDT and USDC well it can't be yuan because they they have onshore and offshore yuan and they
Speaker A
they really really really really CC CCP they want to keep ironclad control over over the currency and so if they had if they if they allowed any kind of access to a stable coin I mean so they've already taken the CBDC route
Speaker A
this is what I'm saying though so they're not going to allow a stable coin to exist in that way right and and that's kind of what I would think you should do is like you choose one or the
Speaker A
other Right? You don't do both, right? And so if the if the EU wants to go the CBDC route, allah China, okay, fine. I don't think that's the winning formula in like a dem like a so-called democratic country. Um, but yeah, do it.
Speaker A
But then don't at the same time try to like do do private moneyish things like uh like stable coins through through private companies. So I don't know. All right, let's switch gears to talk about Robin Hood chain. So, Robin Hood chain
Speaker A
has exploded in popularity and usage. Robin Hood chain of course launched a week or so ago at a big event in Europe. So, barely a week after it's launched, it has flipped base in daily decentralized exchange volume.
Speaker A
It it has flipped BNB chain in DEX volume. It's doing 80% of Salana's daily dex volume over 5x of Hyperliquid's DEX volume. Now, what is Robin Hood chain?
Speaker A
Again, a a recap. It is its own Ethereum L2 built using Arbitum's tech tech stack, right? So, the chain uses ETH as its native gas token. So there's no Robin Hood token and that means fees are paid in ETH and have two parts. There's
Speaker A
the L2 execution fee for activity on Robin Hood chain plus an L1 data fee for posting transa transaction data back to Ethereum. It's the sort of standard Ethereum L2 model. Chief cheap execution off mainet but anchored to Ethereum for
Speaker A
data and finality. Now, with all that high level of activity on Robin Hood chain and the fact that yeah, it it anchors to Ethereum, you would think that this would be great for the Ethereum network.
Speaker A
Here we go. Surely all that volume is means uh like a lot of money is being paid back to the Ethereum mainet and ultrasound money or something. The reality, however, is that, wait for it, $1,500 have so far been paid to the Ethereum
Speaker A
network. Look how happy he is as he says that. So, and it's also not not a lot of money has actually been captured by Robin Hood chain itself either. So far, $816,000 in revenue. Arbitum captures 10% so they
Speaker A
get about 80K and then Ethereum gets 0.15%. So which uh to date equates to yeah about 1,500 bucks.
Speaker A
So I don't know it's another future of finance. Graham Ether Ether the asset it's going to it's going to the moon.
Speaker A
Yeah. So, Joseph Luben, uh, co-founder of Ethereum and current Sharp Link chairman, he came out and said, uh, something which is just ridiculous actually. He said, um, you know, this this is great. Uh, quote, "Tens of thousands of companies will set up shop
Speaker A
over the next two to three years on some mix of Ethereum L1, L2, and private permission EBMs like Bessu Chain." And then somebody replied, um, actually, Mr.
Speaker A
Luben, I'm not sure there are tens of thousands of Robin Hoods out there. In fact, there may only be one or two. And if they're each paying 1,500 bucks a week to Ethereum, I don't think that's going to pump anyone's bags basically
Speaker A
was was the retort there, which that lines up with what I've been saying for.
Speaker A
So, is there anything else to add here or do we is is the dunk on Ethereum complete?
Speaker A
I mean, have we broken the backboard? All I have to say is I've repeated this many times, but hell hath no fury like a bag holder scorned.
Speaker A
Yeah, exactly. I hold I held Ethereum for years and like came out of it basically even and meanwhile lost a lot in opportunity costs.
Speaker A
Yeah. So, yeah, 100% right, Graham. And you know, we've been talking about it and it it doesn't seem like this is going to there's no there's no like model financial model that kind of leads to Ethereum's price going up other than
Speaker A
the specula speculative asset, the speculative nature of it. Like lots of people are using Ethereum. Ethereum is important. Robin Hood's using it. Look at all this activity. I should hold it because I think other people are going to hold it. So
Speaker A
yeah, the the Tom Lee thesis, the Tom Lee thesis that that uh you know the the normal stock market has no value other than that people just want to make other people they want to sell their their useless things to other people
Speaker A
which is valid. That is valid. That is a I mean sadly kind of how it works.
Speaker A
I actually don't think that's kind of why the stock market has gone up so much for for this whole time.
Speaker A
You could argue exactly why, but it it it seems like it has more there's more fundamental reasons for that than than in crypto. Do you know you know what I'm saying? Like absolutely. I mean, billions of dollars are actually being invested into data
Speaker A
center buildout, chips, construction, all that. Specifically, electricians. Yeah. Well, he specifically thousand. Yeah. He was like, Apple's valuation doesn't really make sense. like, well, you walk around the world and everyone has Apple phones and Apple's like a household
Speaker A
brand name because they build things in the real world and you know, so anyway, it's but there's quite a few people out there with Ethereum tattoos on them. So, I I think the kind of the the maybe the
Speaker A
more interesting part about this is what this means. So, so number one, um, how much of this activity on the Robin Hood chain is is sustainable? I wrote about this in the newsletter last week.
Speaker A
Like the it's thus far it's followed a kind of a very similar pattern where you get like a new a new happening cool L2 with some kind of spin on a narrative like, oh, this is Robin Hood and they
Speaker A
have a lot of everybody jumps in on the memes. They all go in because there's no there's no native memes, right? They're like, "No, it's like a fresh slate. We can make a new meme culture, right? Like Doge was on Ethereum, but then we go to
Speaker A
Salana and we have Whiff because it's it's like Doge, but it's different." And so then whiff gets pumped up because all the speculators they did that on base.
Speaker A
Yeah. If you remember that Hyper even Hyper EVM had that and I got suckered in.
Speaker A
Yes. And so you're seeing this with Robin Hood chain now too. A a lot of the I don't know meme Koss have are on my timeline here and they're like yes no the the real meme is Vlad Tennib's cat
Speaker A
thing or you know whatever this kind of like just just the lowest of the low kind of stuff. So, I I think I think I want to know and maybe Alex, you and I can get into this afterwards, but I'd
Speaker A
like to get it dig into the data and see like what where is this what's what is the what is the volume representing?
Speaker A
Like the DEX volume representing? Is it is it just [ __ ] meme coins being traded or or are are people in the Robin Hood app actually like buying and selling real like like Bitcoin or Ether or something like that? my
Speaker A
stocks or stocks, but it's on the decks, right? Like, so I'm like, so my guess is that it's just a bunch of like PVP degenerate kind of emaciated crypto natives trying to like take money from each other. Um, and and that very few
Speaker A
Robin Hood users, actual Robin Hood users are are using this to to do to do like, oh, I want to buy some Ether, you know? I don't know. That would be my guess. And so the the interesting thing
Speaker A
is if if I'm right, what you'd see is you'd see this volume go down over time unless actual Robin Hood users, which they have a lot of, start to start to use this as well. So far, what I'm
Speaker A
seeing is it's about half the half of the volume is settling into ETH or wrapped ETH. You got 7% stable coins and then about like 40 45% of just memes, animal memes, Vlad memes, and other memes. So, calling Robin Hood like a a
Speaker A
memecoin chain right now is is probably fair. Doesn't mean it can change it can't change in the future, but yeah, like right now it's just redacted speculators who hate their family and want to lose all their money.
Speaker A
I think their family hates them is probably the more accurate way that works. But I I like it's benefiting Robin Hood. I mean, if if there's like an optimistic point of view, like Robin Hood is making money off it. But yeah, it's not bullish
Speaker A
for ETH, is it? Well, I think it's bullish the like I said last week, this is to me bullish Ethereum the the network, right? like um because it it kind of means that to me at least again I I asked people at the
Speaker A
conference this too and they were kind of non-committal but it it just feels like uh it would it would reinforce this idea that it's going to be a win or take most for for like a a public chain, right?
Speaker A
Like because then why you if you're going to make your own chain, why don't just spin up an L2 on Ethereum? You get that security benefit and you don't have to invest super heavily in infrastructure. But then, you know, why
Speaker A
why do you why do you need to spin up your own L1 or why do you have to use an alt L1? Just uh just throw it on ETH.
Speaker A
You don't have to give them any money and uh yeah, the network works. That that's awesome. But like I guess I'm just wondering what how do you make money off off of that? Like from an investment standpoint, let's say like
Speaker A
all of these companies decide to build chains on ETH and you're here to try to make money. You're not just here for the tech. What like where is the value capture? That that's kind of that's kind of wonder. Yeah. Okay. Yeah.
Speaker A
No one disputes the like Ethereum's dominance. I I don't. that it just seems like most of the value acrruel or value capture is going to equity in the businesses that use the chains, right?
Speaker A
Like I think I think crypton natives are kind of slowly coming to this this uh sobering conclusion that most of crypto isn't really an asset class as much as it's a technology for businesses to become more efficient and profitable.
Speaker A
Like we thought it was an asset class before because blockchains have tokens and tokens have price charts and price charts make us want to speculate and speculators tend to be optimistic and stareyed about new technologies. So we all thought the price charts were going
Speaker A
to moon but in reality the the tokens are designed to just like trend towards zero as the businesses that use them demand more speed and efficiency and also as more blockchains get launched like technology in general is deflationary. So besides
Speaker A
Yeah. I mean It's it's it's basically it looks like the thesis that the the money it's going to follow the same thing that happened with the internet, right? It looks like like Yeah. Comcast or whatever internet provider in third
Speaker A
world Canada, what do you call it? Roger Rogering Roger. Rogers, whatever it is. Yeah, they they they [laughter] was a joke. They Yeah, they make some money, but do they do they make most of the money that the internet
Speaker A
provides? No. No, it's Facebook. It's Google, right? And so, yeah, companies have over the infrastructure way better.
Speaker A
Yeah. And so, that's what Ethereum is going to be, I think. Right. That's what these blockchain L1s are going to be.
Speaker A
They're going to be like that. It that's kind of what it feels like to me right now. I don't know.
Speaker A
Yeah. You you can see this like besides Bitcoin and privacy coins and maybe a few outliers, the the value acrruel of crypto is mostly these businesses that use it rather than the tokens. So like you got Robin Hood Robin Hood chain is
Speaker A
the most striking recent example of this robin Hood chain is widely accepted right now is like one of the most bullish things to happen in crypto at least in the last few years but where's the alpha you like how do you capture
Speaker A
the upside apparently it's not ETH it's not ARB token or some other token it's clearly just buying Robin Hood stock and look at Robin Hood stock it's up 1 1600% since the bare market lows of 2022 Bitcoin only ran up like 700% top to
Speaker A
bottom from 2022 2 to 2025 and now it's down 50%. And probably same with Bass.
Speaker A
Like if Bass ends up being a big success for Coinbase, how are you going to make money off it? Are you going to buy ETH?
Speaker A
Are you going to buy or are you going to buy shares in Coinbase? Like Coinbase stock has also done very well since the 2022 uh bare market even after a 60% dip. And if Circle's ARC ends up being a
Speaker A
success, are you going to buy ARC or are you going to buy shares in Circle? or if Stripe and PayPal launches their chain, are you going to buy their native token at multiple billion dollar valuations or you just going to buy shares in the
Speaker A
company? I I don't know. I'm I'm not trying to be like negative towards crypto and the tokens. It's just that I'd rather be honest about the most realistic way to make money and I'd rather make like 10 20% on some large
Speaker A
cap stock than lose 90% on uh some of these tokens. Yeah, I think the only thing that could maybe save it is uh if we actually get the the resolution of tokens as equity, then yeah, they they do become like stocks and there's a
Speaker A
there's a world there where a crypto company that does well has a token that can invest in. But for now, yeah, Alex, as you say, it's just uh it's not really an asset class. It's just like underlying infrastructure that real
Speaker A
things are built on and that's the real things that are built on it. That's where the value cruel that's where the value acrru.
Speaker A
All right. Yeah, fair enough. All right. That's a good place. Yeah. No, go ahead. You're That's a good place to end it. It's been a It's been a another uh spicy chat.
Speaker A
Thank you, gentlemen. Really enjoyed this one. Yes, indeed. All right, let's uh let's wrap it up there. Uh, next week we are go Spain. That's right. And also next week we're off. We're taking a week off.
Speaker A
Summer doldrums. So, uh, yeah, stay tuned. We'll be back the week after and go touch grass.
Speaker A
Keep keep those token those token narratives fresh. [music] All right. Stay away from memes. Go touch grass.
Speaker A
Have a great uh, yeah, summer holiday. See you. [music]
Topics:Digital EuroRobinhoodCryptocurrencyBitcoin SOPRCrypto market bottomCBDCEthereumCrypto sentimentRobinhood chainToken Narratives
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