Next Leg Up: Where Crypto Markets Go From Here | DAS London 2025 | Day 2 | Main
Summary
Crypto and Equity Market Convergence: The podcast discusses the convergence between equity markets and crypto, highlighting the role of DATs (Digital Asset Trusts) as a new access vehicle for investors, providing yield and growing the number of tokens per share.
Investment Strategies: DATs are emphasized as a means to provide wider access to crypto investments, with strategies like financial engineering and staking to increase value, particularly in the Salana and Ethereum spaces.
IPO Market for Crypto: The conversation covers the opening of the IPO market for crypto companies, noting the shift in US regulatory stance and the increase in high-profile IPOs, which is expected to attract more growth-stage investors.
Debasement Trade: The podcast highlights the ongoing "debasement trade," where fixed quantity assets like Bitcoin are seen as valuable due to governments printing more money, leading to a decrease in the value of paper currencies.
Market Outlook: The discussion includes a contrarian view on interest rates, suggesting that the Fed should maintain higher rates due to inflation, and emphasizes the importance of investing in fixed quantity assets like crypto.
Equity Market Valuation: Equities are considered overvalued relative to bonds, with a potential 25% drop needed to align with historical averages, while the bond market remains manipulated by the Federal Reserve's actions.
Blockchain Investment Opportunities: The podcast concludes with a bullish outlook on blockchain, highlighting the potential for high returns and low correlation with traditional markets, encouraging institutional investors to consider blockchain investments.
Transcript
Dan, so good to be with you here today. Thanks for having me. Yeah. Um, we got a lot to cover here, but for folks who might not know you, could you just give a quick 30 second intro to you and, uh, Panta? Sure. I'm originally a global macro investor. I was at Tiger Management before Panta, founded Panta 22 years ago, and in 2013, we were the first investment firm to go into Bitcoin and blockchain. Awesome. So I would love to start with uh this idea actually that we opened the conference with which is this uh convergence that's happening in between equity markets and crypto and I think maybe the two directions that we can go down here are DATs which I think some folks in this audience have probably heard about uh yesterday uh but then I also want to talk about IPOs and the IPO market opening up. So you want to start with DATs and I would love to just get your high level take. I know Panta's been relatively involved. Yeah. So, I think dads actually are a very important new access vehicle. And I will admit I was skeptical at first. Um, you know, when uh Michael Sailor started doing Bitcoin on his balance sheet, we don't really invest in public companies, so I was able to ignore it. Um, and as it started growing and the snowball started getting bigger, I had to kind of think about it and address it. And I remember uh meeting a friend of mine, Mark Casey, who's a neighbor in California, and he owned 10% of Micro Strategy stock. And I was like, that seems kind of crazy, right? And his response uh 3 four years ago really still resonates. He said he's a 40act investor and that's he's very bullish on Bitcoin and that's literally the only way he could get exposure to Bitcoin for his mutual fund investors. They invested a bit less than a billion dollars and now six billion of value. That is a great trade. He's added five billion of value for his mutual fund investors. So it really is all about access. Um our funds are typically for you know essentially very high uh ticket items. Our average investors $2.5 million. We've launched the Salana company, HSDT, ADAT. The average trade's 2,200 bucks. So, it's a thousand times more accessible. Um, and I think the thing that people aren't yet the skeptics, and there still are a lot of people skeptical, is they don't get that they that that DATs add a ton of value. Um, Strategy is a, you know, the biggest example in our space. They've added 76% more bitcoins per share last year. Uh so you know ETFs are inert. They don't do anything. They don't stake. They don't grow yield. They don't grow the number of bitcoins per share. But strategy has been able to grow at 76% last year and I think about 30% this year. So DATs really do have the ability to provide access to people, provide yield, hopefully be able to grow the number of tokens per share. Mhm. So in your mind, Dan, do you think that DATs will permanently solve because I think there's been a huge problem right over the course of the last basically uh the entire time that crypto's been alive with um capital flowing into the space and so it kind of flows in sometimes in these uneven ways. Maybe DATs are one conduit and vehicle for that. The other thing that DATs do, maybe less on the Bitcoin side of things, but some of the Salana Dats and Ethereum DATs are talking about more actively managing that capital, doing things like staking, deploying into DeFi. you know, when you look at the premium like the MNAV, which is what people like to talk about, here's the premium on DAT valuations. Um, do you see it more being generated because of this uh inability for capital to access crypto or is it going to be generated more actively through these strategies? Yeah, that's the beauty. It's all those things. It's um providing access to a wider audience which um you know is very important because it's very hard to get access to some of these uh some of these projects. It's taking a a a smart view on financial engineering. Like Strategy's done a great job with preferred debt. They've increased the value of their um uh NAV by adding more bitcoins through financial engineering. They don't do staking, but Salana and Ethereum do staking. So, you add, you know, seven or so percent yield onto that. Um and so they have been able to grow the number of tokens per share. One of my one of my partners says a funny line that the worst case for a DAT is it trades at par every day. And that's what an ETF does, right? So like the way I think about it is DAT's really kind of the downside is it is just inert and trades like an ETF. But you do have the upside if you can increase the number of tokens per share. Um so there's there's been a a flourish of them. I do think there's probably only be one or two per currency. you know, I don't think you need, you know, 20 uh Bitcoin DATs, but you do need, you know, one or two very wellrun ones in each currency. Well, I know that Panta has a Salana focused. I don't know if this is something you can speak about, but why Salana versus something like Bitcoin or Ethereum? Like why that particular Yeah, actually uh two reasons. One is um Michael Sailor is doing a great job on Bitcoin. They've been doing that for a long time. So, we didn't really feel like we could add anything. Um, we're one of the earliest largest investors in Bit Mine and Tom Lee's doing a great job on Ethereum. So there again, we didn't feel like we could add much. There wasn't yet a um, well, there are a few DATs in the Salana space, but we felt like we could we could add something. We've done a partnership with the Salana Foundation. Um, and so we think we can become the preeminent uh, Salana debt. The other reason we're doing it is our largest position, right? So we we really have the most uh conviction in Salana and I know people get into religious wars about which token is the best and we've had huge positions of Ethereum at times. We've had massive positions in Bitcoin right now over the last say year. Salana's been our largest position. So it really aligns with our positioning to do that. And I actually think Salana is such an interesting story because obviously Bitcoin's been around for 17 years. It's awesome. Everybody knows the story. Ethereum's been around for 10, actually. So, you know, most people really know the story. There's still a lot of people that just don't know what Salon is and why it's important. It trades at only 5% of the market cap of Bitcoin. So, as a trader, I I kind of think it has, you know, more asymmetric upside, right? Like it really could catch up a bit to uh Bitcoin and Ethereum. So, all those things came together uh encourage us to do one. Mhm. I'd love to get your perspective on the IPO market for crypto. So, you know, a couple of years ago, all we had was Coinbase as a public company. Now, there have been a number of relatively high-profile IPOs. Uh, Circle, Gemini, etc. I know Panta's had a couple of IPOs from your portfolio. Um, do you think that window is now permanently open and we should expect a lot more um IPOs? You know, talk to me about how you're viewing that particular part of the market? Yeah, it's a really important theme for our industry and the way I would characterize it is I think um essentially the US government, the US SEC essentially restrained our industry for a long time for reasons I frankly don't really understand. Uh but I think that's permanently changed. Um obviously the party that controls the White House will change from time to time, but Congress really changed dramatically. There used to be a lot of very negative people in Congress. Um, our industry competed in 58 congressional elections. Last election, 54 anti-crypto people uh lost their jobs and were replaced by 54 pro- crypto people. So, Congress is flipped to being actually very pro- crypto. If you think about it, there's a lot of really wild things going on in the world that Congress might devote time to, and they devoted it to stable coins. Yeah. And you know I'm in crypto so I think that's great but like you know frankly it's kind of esoteric issue for the United States Congress to address. They're working on market structure which is super important. So all those have literally 180 changed the the regulatory uh stance in the US. It used to be very scary for crypto um and now it's it's essentially open for business that Circle could have or should have gone public years ago. It's a great company. There's no reason it shouldn't have been public. uh it's 30 40 billion market cap, right? Like that should be a public company. It's not not supposed to be private. Um and and so the way I view it is it's kind of like it had been repressed for so long that it's kind of like an oil Derek, you know, when you stick a you know a pipe into it, it just a geyser comes out. And that's what's happening. All these IPOs are just exploding out of the ground because there was so much pressure repressing it for a long time. There have been nine IPOs this year in the crypto space, not counting all the DATs. Um, great companies like Circle we've been investing for 12 years. Uh, Figure Markets. Um, another company we've been investing for a long time, Amber. You know, all these portfolio companies are finally getting to go public. Um, and and the cool thing is you now have to have an opinion on crypto. If you're kind of a normal investor, you're typically benchmarked against the S&P 500. And the S&P 500 includes crypto companies, right? So, you kind of can't ignore it anymore. And to my mind that's so important because for a long time a lot of skeptics you know really tried to keep crypto you know kind of off their balance sheet didn't want to talk about it and now with crypto and the S&P 500 you you have to have an opinion. Mhm. What do you think the eventual liquidity event uh for companies is going to be moving forward? And what I mean by that is historically, you're a private company, you work your way up, hopefully you can IPO, get acquired one day. But in crypto, we have this thing called tokens, which is we launch those and those are pretty liquid from even a very early stage, as early as you really want to be. Um, do you think that companies will choose one versus the other now that we have access to capital markets in the US? We do have some there are some businesses that have both equity and tokens. I'm just curious how you think about that from with your investor hat on. Yeah. So, um you're right. Back in the day, things used to either be a token like Bitcoin. There was no company or it used to be an equity and there was never going to be a token. And now it is a bit confusing. There are a lot of projects that have both equity and a token. Um thankfully, those projects typically sell both at the same time to the investor. So, you get to you get to buy both. Um, ultimately some things just don't need a token and you know a lot of protocols don't need equity. So, uh, those should stay um, relatively separate. Your point's very valid though is tokens go live so much quicker than equity. Um, typically within a couple of years. Uh, and so one of the reasons investors really should focus on our space is that capital really recycles a lot faster than in the real world. Uh but the funny thing is even in venture equity it happens much faster in blockchain. We've been doing venture funds for 13 years. All of our venture funds have repaid their capital to their investors within four and a half years which is super fast compared to the real world where it normally takes you know 6 8 10 years to to return capital. Um so I think that's one of the reasons why investors like our space. It just you you kind of turn the capital you know every four five years rather than you know every 15 or 20. Yeah. And do you think I mean one uh I'm wondering what the implications of the IPO market being open are and I think in crypto you have a lot of very early stage investors maybe because you invest early there's some sort of token and early liquidity event but it seems like there's less capital available later um in kind of like the growth equity stage like do you think that that might change if there are you know successful IPOs and you know um liquidity events for the equity investor side of things like how do you what are the changes that you see with the IPO market? I think it's a great point that, you know, when the when the pipe was stuck and blocked for 10 years, it's kind of hard to convince somebody to invest in a growth equity company if you can't see it ever going public. But now that companies are going public, uh I do think you're going to have normal investors want to come in and invest in preIPO companies and and we've seen that with our own portfolio. Uh four companies went public this year. um Bitco has filed an S1 to go public, you know, so there's this very clear uh it's like the flight path into an airport. You can see all these incoming IPOs. And so if you're a growth stage investor and you've seen nine companies go public, you see a bunch more filing, you see other um companies that are, you know, there's companies, you know, like chain analysis, they've been around for 12 years. Like they're they could easily be public. So um so I do think you're going to see kind of normal growth stage investors come into our space and and we've seen that with our own uh kind of institutional investor base where 68 months ago we'd be telling them hey you know circle's about ready to go public or figure about ready to go public and at the time you know only a couple of our big investors really kind of took it seriously and did the work and invested. I would think going forward now that all those have worked uh and worked really well. This if if you put a dollar in each of the five Panta oriented IPOs this year, you'd have 11 bucks, right? So, you know, it's the the returns are fantastic for investing in the space that will bring more people in. Yeah. I I would love to maybe zoom out of, you know, kind of the market structure questions and just uh under try to get your view of what's going on in this market. Um maybe more broadly even outside of crypto. So, you know, where I want to end this conversation on is this idea of the debasement trade that everyone is talking about, but you know, I'm curious. Do you think we're heading into a market that feels a little stagflationary and stalled or, you know, we're also in the beginnings of earlyings of a rate cutting cycle? There are some, you know, very positive uh ways that you could look at this market, too. Um, yeah, so I have a very strong view on that. The macro world is pretty messed up. The Fed made a couple huge policy errors in 2021 and 222. And I would say we're in the beginning of a rate hike cycle. And I know this is super out of consensus. But it's crazy to be cutting rates when inflation's 50% higher than quote stable prices, which is only debasing your money 2% a year, which is 80% over your lifetime. Um, unfortunately, I think most countries have kind of let it go, right? the US is cutting rates when it's has a fiscal deficit larger than any time in history with everything as good as possible. And so um you know the I I think it maybe it was JP Morgan that called it the debasement trade. Goldman just sent a report on the debasement trade. is it front page of the Wall Street Journal now in um one of our uh content guys who's been with Panta for 10 years like we've been saying that for 10 years you know right so I do feel like um it's it's cool that that kind of mainstream you know media and Wall Street are now branding it you know the debasement trade and getting into it but it's it is important and we you know we've been we've been focused on it for a long time but I think it is very important and it's super relevant to the crypto industry is if the governments of the world are just going to keep printing pieces of paper money and just flooding the markets with paper money, the things that are of fixed quantity have to go up in price relative to paper money. And every day you read a headline that, you know, Bitcoin hits an all-time high, gold hits an all-time high, housing hits an all-time high, all that stuff, it's actually paper money hitting an all-time low is really what's going on. Everything else is relatively the same. you know, all those other fixed uh price assets. So, I actually do think our industry is totally irrelevant right now because the you know, the governments of the world essentially have kind of let it let it drift and and and go and they're going to always just try and keep debasing relative to each other. And I think even the Treasury Secretary of the US said they want a weaker dollar, but we can't all have a weaker currency against each other, right? Like that just keeps going to zero. Uh and so you kind of have to look at fixed quantity things, you know, like Bitcoin and other cryptos. Yeah, I it's just it is interesting that Wall Street has really um you know, glombmed on to this recently. And yeah, to your point, you've been talking about this for many years and I noticed uh Muhammad Alian the other day tweeted out a chart of the S&P denominated in gold and Bitcoin, which is if you've been in the space on Twitter for a number of years, people have been tweeting that stuff out forever, but it's interesting to see it come from him. Uh and and I'm curious too, just to clarify your uh your discussion on being in a rate height cycle versus a cut cycle. Do you think that's what we ought to do or what is going to happen? Because if we're in the beginning of a rate hike cycle, I would imagine that markets have a little bit of room to fall from here. Yeah. So, um this is out of consensus, but I'm happy to be out of consensus. In December 2021, the um Fed funds rate was zero and the tenure note was 1.3. We put out our investor letter which is available to anybody in the room if they want to sign up for it saying that both of those would go to 5%. They did and I think they should stay and I said they would stay there for a long time. Fed fund should be 5%. The 10ear should be 5%. It I think it's a mistake to be cutting tricky. You're making me say whether they're going to admit they made a mistake and go the other way. 50/50, right? Like adults don't often admit they make a mistake and do the opposite. But um they really should. And so that's why I'm bullish crypto, right? If they want to cut rates when inflation's 3%. Massive housing inflation, massive inflation everything else like gold and h everything that's not directly in the CPI index, um they probably should hike, but given that they won't um or it's 50/50 that they do a hike, you just got to be long fixed quantity things like like crypto. um because I don't see any other way out. The the debt payments in the US are now bigger than military and other and definitely way bigger than education and infrastructure and all the other things one might want to spend on. So, you know, I'm curious. I I was watching a a clip from Paul Tudtor Jones the other day who said that we might be enter it might be everyone loves to say we're in this year or that year and he was making this comparison to 1999 this kind of big blowoff top you know before an eventual crash. I'm curious does that analog resonate with you? does it not? Yeah. So 99 uh was potentially a unique weird phenomenon. I was a tiger then and all the tech stuff.com stuff was going to crazy prices. I don't see that kind of craziness here uh in the equity market. I think equities are very overvalued relative to bonds is is what I would say that if you look at the 50-year average of the equity risk premium equities that have to fall 25% to be fairly valued versus the 50-year average. So, so I think equities are a bit expensive or probably bonds are way too expensive. The Fed bought 9 trillion of bonds. They manipulated the bond market. So, that is kind of the weird thing is that the Federal Reserve is manipulating rates and they they still are. So, I don't see a kind of.com explosion, you know, kind of epic thing that's going to happen in the next 12 months. I just see this kind of slow decay of like paper currencies versus, you know, hard money. Um, you know, so it's not going to be something you're going to read about in the newspaper tomorrow that, you know, Paul Jones is super smart guy and maybe he's right, maybe everything will blow up tomorrow. I think it's more of kind of a a slow decay and it's kind of a boil the frog thing, right? like you just don't feel it in uh this country has the oldest currency on earth, right? It used to be backed by a pound of sterling silver, right? They've printed so many pieces of paper, pound sterling. It takes 340 pieces of the paper ones to buy a pound of sterling silver. You just don't notice the decay, but it's there. Yeah. Well, then we're about to be out of time here, but I know you're raising fun five here, so if you could uh maybe close on just telling the audience a little bit about that. Yeah. So, uh, I I actually am as bullish on blockchain as ever. The the change in the regulatory system in the US really opens it up to allow, you know, companies to go public. We've had 25 companies become unicorns. You know, I think the next decade is even better than that. And what we did in our last fund is put all four asset classes together. So, venture equity, private tokens, special opportunities, and liquid tokens. And you can kind of move the capital from the expensive sector to the cheap sector, you know, during that. And in our uh current fund that we're almost done investing already has twice as many assets as the commitments that we got four years ago and we haven't even fully called the capital. So I think you know the blockchain space just has those kinds of opportunities that are you know really hard to get in kind of the normal markets and and the returns from our space over all this you know 12 years have just been you know off the charts and very low correlation the S&P 500. So any institutions out there which the majority of which still have 0.0 that's so important the majority of institutional investors have 0.0 you just got to get off zero. All right Dan this was a lot of fun. Thank you so much for coming and doing this. Guys, give him a big round of applause.
Next Leg Up: Where Crypto Markets Go From Here | DAS London 2025 | Day 2 | Main
Summary
Transcript
Dan, so good to be with you here today. Thanks for having me. Yeah. Um, we got a lot to cover here, but for folks who might not know you, could you just give a quick 30 second intro to you and, uh, Panta? Sure. I'm originally a global macro investor. I was at Tiger Management before Panta, founded Panta 22 years ago, and in 2013, we were the first investment firm to go into Bitcoin and blockchain. Awesome. So I would love to start with uh this idea actually that we opened the conference with which is this uh convergence that's happening in between equity markets and crypto and I think maybe the two directions that we can go down here are DATs which I think some folks in this audience have probably heard about uh yesterday uh but then I also want to talk about IPOs and the IPO market opening up. So you want to start with DATs and I would love to just get your high level take. I know Panta's been relatively involved. Yeah. So, I think dads actually are a very important new access vehicle. And I will admit I was skeptical at first. Um, you know, when uh Michael Sailor started doing Bitcoin on his balance sheet, we don't really invest in public companies, so I was able to ignore it. Um, and as it started growing and the snowball started getting bigger, I had to kind of think about it and address it. And I remember uh meeting a friend of mine, Mark Casey, who's a neighbor in California, and he owned 10% of Micro Strategy stock. And I was like, that seems kind of crazy, right? And his response uh 3 four years ago really still resonates. He said he's a 40act investor and that's he's very bullish on Bitcoin and that's literally the only way he could get exposure to Bitcoin for his mutual fund investors. They invested a bit less than a billion dollars and now six billion of value. That is a great trade. He's added five billion of value for his mutual fund investors. So it really is all about access. Um our funds are typically for you know essentially very high uh ticket items. Our average investors $2.5 million. We've launched the Salana company, HSDT, ADAT. The average trade's 2,200 bucks. So, it's a thousand times more accessible. Um, and I think the thing that people aren't yet the skeptics, and there still are a lot of people skeptical, is they don't get that they that that DATs add a ton of value. Um, Strategy is a, you know, the biggest example in our space. They've added 76% more bitcoins per share last year. Uh so you know ETFs are inert. They don't do anything. They don't stake. They don't grow yield. They don't grow the number of bitcoins per share. But strategy has been able to grow at 76% last year and I think about 30% this year. So DATs really do have the ability to provide access to people, provide yield, hopefully be able to grow the number of tokens per share. Mhm. So in your mind, Dan, do you think that DATs will permanently solve because I think there's been a huge problem right over the course of the last basically uh the entire time that crypto's been alive with um capital flowing into the space and so it kind of flows in sometimes in these uneven ways. Maybe DATs are one conduit and vehicle for that. The other thing that DATs do, maybe less on the Bitcoin side of things, but some of the Salana Dats and Ethereum DATs are talking about more actively managing that capital, doing things like staking, deploying into DeFi. you know, when you look at the premium like the MNAV, which is what people like to talk about, here's the premium on DAT valuations. Um, do you see it more being generated because of this uh inability for capital to access crypto or is it going to be generated more actively through these strategies? Yeah, that's the beauty. It's all those things. It's um providing access to a wider audience which um you know is very important because it's very hard to get access to some of these uh some of these projects. It's taking a a a smart view on financial engineering. Like Strategy's done a great job with preferred debt. They've increased the value of their um uh NAV by adding more bitcoins through financial engineering. They don't do staking, but Salana and Ethereum do staking. So, you add, you know, seven or so percent yield onto that. Um and so they have been able to grow the number of tokens per share. One of my one of my partners says a funny line that the worst case for a DAT is it trades at par every day. And that's what an ETF does, right? So like the way I think about it is DAT's really kind of the downside is it is just inert and trades like an ETF. But you do have the upside if you can increase the number of tokens per share. Um so there's there's been a a flourish of them. I do think there's probably only be one or two per currency. you know, I don't think you need, you know, 20 uh Bitcoin DATs, but you do need, you know, one or two very wellrun ones in each currency. Well, I know that Panta has a Salana focused. I don't know if this is something you can speak about, but why Salana versus something like Bitcoin or Ethereum? Like why that particular Yeah, actually uh two reasons. One is um Michael Sailor is doing a great job on Bitcoin. They've been doing that for a long time. So, we didn't really feel like we could add anything. Um, we're one of the earliest largest investors in Bit Mine and Tom Lee's doing a great job on Ethereum. So there again, we didn't feel like we could add much. There wasn't yet a um, well, there are a few DATs in the Salana space, but we felt like we could we could add something. We've done a partnership with the Salana Foundation. Um, and so we think we can become the preeminent uh, Salana debt. The other reason we're doing it is our largest position, right? So we we really have the most uh conviction in Salana and I know people get into religious wars about which token is the best and we've had huge positions of Ethereum at times. We've had massive positions in Bitcoin right now over the last say year. Salana's been our largest position. So it really aligns with our positioning to do that. And I actually think Salana is such an interesting story because obviously Bitcoin's been around for 17 years. It's awesome. Everybody knows the story. Ethereum's been around for 10, actually. So, you know, most people really know the story. There's still a lot of people that just don't know what Salon is and why it's important. It trades at only 5% of the market cap of Bitcoin. So, as a trader, I I kind of think it has, you know, more asymmetric upside, right? Like it really could catch up a bit to uh Bitcoin and Ethereum. So, all those things came together uh encourage us to do one. Mhm. I'd love to get your perspective on the IPO market for crypto. So, you know, a couple of years ago, all we had was Coinbase as a public company. Now, there have been a number of relatively high-profile IPOs. Uh, Circle, Gemini, etc. I know Panta's had a couple of IPOs from your portfolio. Um, do you think that window is now permanently open and we should expect a lot more um IPOs? You know, talk to me about how you're viewing that particular part of the market? Yeah, it's a really important theme for our industry and the way I would characterize it is I think um essentially the US government, the US SEC essentially restrained our industry for a long time for reasons I frankly don't really understand. Uh but I think that's permanently changed. Um obviously the party that controls the White House will change from time to time, but Congress really changed dramatically. There used to be a lot of very negative people in Congress. Um, our industry competed in 58 congressional elections. Last election, 54 anti-crypto people uh lost their jobs and were replaced by 54 pro- crypto people. So, Congress is flipped to being actually very pro- crypto. If you think about it, there's a lot of really wild things going on in the world that Congress might devote time to, and they devoted it to stable coins. Yeah. And you know I'm in crypto so I think that's great but like you know frankly it's kind of esoteric issue for the United States Congress to address. They're working on market structure which is super important. So all those have literally 180 changed the the regulatory uh stance in the US. It used to be very scary for crypto um and now it's it's essentially open for business that Circle could have or should have gone public years ago. It's a great company. There's no reason it shouldn't have been public. uh it's 30 40 billion market cap, right? Like that should be a public company. It's not not supposed to be private. Um and and so the way I view it is it's kind of like it had been repressed for so long that it's kind of like an oil Derek, you know, when you stick a you know a pipe into it, it just a geyser comes out. And that's what's happening. All these IPOs are just exploding out of the ground because there was so much pressure repressing it for a long time. There have been nine IPOs this year in the crypto space, not counting all the DATs. Um, great companies like Circle we've been investing for 12 years. Uh, Figure Markets. Um, another company we've been investing for a long time, Amber. You know, all these portfolio companies are finally getting to go public. Um, and and the cool thing is you now have to have an opinion on crypto. If you're kind of a normal investor, you're typically benchmarked against the S&P 500. And the S&P 500 includes crypto companies, right? So, you kind of can't ignore it anymore. And to my mind that's so important because for a long time a lot of skeptics you know really tried to keep crypto you know kind of off their balance sheet didn't want to talk about it and now with crypto and the S&P 500 you you have to have an opinion. Mhm. What do you think the eventual liquidity event uh for companies is going to be moving forward? And what I mean by that is historically, you're a private company, you work your way up, hopefully you can IPO, get acquired one day. But in crypto, we have this thing called tokens, which is we launch those and those are pretty liquid from even a very early stage, as early as you really want to be. Um, do you think that companies will choose one versus the other now that we have access to capital markets in the US? We do have some there are some businesses that have both equity and tokens. I'm just curious how you think about that from with your investor hat on. Yeah. So, um you're right. Back in the day, things used to either be a token like Bitcoin. There was no company or it used to be an equity and there was never going to be a token. And now it is a bit confusing. There are a lot of projects that have both equity and a token. Um thankfully, those projects typically sell both at the same time to the investor. So, you get to you get to buy both. Um, ultimately some things just don't need a token and you know a lot of protocols don't need equity. So, uh, those should stay um, relatively separate. Your point's very valid though is tokens go live so much quicker than equity. Um, typically within a couple of years. Uh, and so one of the reasons investors really should focus on our space is that capital really recycles a lot faster than in the real world. Uh but the funny thing is even in venture equity it happens much faster in blockchain. We've been doing venture funds for 13 years. All of our venture funds have repaid their capital to their investors within four and a half years which is super fast compared to the real world where it normally takes you know 6 8 10 years to to return capital. Um so I think that's one of the reasons why investors like our space. It just you you kind of turn the capital you know every four five years rather than you know every 15 or 20. Yeah. And do you think I mean one uh I'm wondering what the implications of the IPO market being open are and I think in crypto you have a lot of very early stage investors maybe because you invest early there's some sort of token and early liquidity event but it seems like there's less capital available later um in kind of like the growth equity stage like do you think that that might change if there are you know successful IPOs and you know um liquidity events for the equity investor side of things like how do you what are the changes that you see with the IPO market? I think it's a great point that, you know, when the when the pipe was stuck and blocked for 10 years, it's kind of hard to convince somebody to invest in a growth equity company if you can't see it ever going public. But now that companies are going public, uh I do think you're going to have normal investors want to come in and invest in preIPO companies and and we've seen that with our own portfolio. Uh four companies went public this year. um Bitco has filed an S1 to go public, you know, so there's this very clear uh it's like the flight path into an airport. You can see all these incoming IPOs. And so if you're a growth stage investor and you've seen nine companies go public, you see a bunch more filing, you see other um companies that are, you know, there's companies, you know, like chain analysis, they've been around for 12 years. Like they're they could easily be public. So um so I do think you're going to see kind of normal growth stage investors come into our space and and we've seen that with our own uh kind of institutional investor base where 68 months ago we'd be telling them hey you know circle's about ready to go public or figure about ready to go public and at the time you know only a couple of our big investors really kind of took it seriously and did the work and invested. I would think going forward now that all those have worked uh and worked really well. This if if you put a dollar in each of the five Panta oriented IPOs this year, you'd have 11 bucks, right? So, you know, it's the the returns are fantastic for investing in the space that will bring more people in. Yeah. I I would love to maybe zoom out of, you know, kind of the market structure questions and just uh under try to get your view of what's going on in this market. Um maybe more broadly even outside of crypto. So, you know, where I want to end this conversation on is this idea of the debasement trade that everyone is talking about, but you know, I'm curious. Do you think we're heading into a market that feels a little stagflationary and stalled or, you know, we're also in the beginnings of earlyings of a rate cutting cycle? There are some, you know, very positive uh ways that you could look at this market, too. Um, yeah, so I have a very strong view on that. The macro world is pretty messed up. The Fed made a couple huge policy errors in 2021 and 222. And I would say we're in the beginning of a rate hike cycle. And I know this is super out of consensus. But it's crazy to be cutting rates when inflation's 50% higher than quote stable prices, which is only debasing your money 2% a year, which is 80% over your lifetime. Um, unfortunately, I think most countries have kind of let it go, right? the US is cutting rates when it's has a fiscal deficit larger than any time in history with everything as good as possible. And so um you know the I I think it maybe it was JP Morgan that called it the debasement trade. Goldman just sent a report on the debasement trade. is it front page of the Wall Street Journal now in um one of our uh content guys who's been with Panta for 10 years like we've been saying that for 10 years you know right so I do feel like um it's it's cool that that kind of mainstream you know media and Wall Street are now branding it you know the debasement trade and getting into it but it's it is important and we you know we've been we've been focused on it for a long time but I think it is very important and it's super relevant to the crypto industry is if the governments of the world are just going to keep printing pieces of paper money and just flooding the markets with paper money, the things that are of fixed quantity have to go up in price relative to paper money. And every day you read a headline that, you know, Bitcoin hits an all-time high, gold hits an all-time high, housing hits an all-time high, all that stuff, it's actually paper money hitting an all-time low is really what's going on. Everything else is relatively the same. you know, all those other fixed uh price assets. So, I actually do think our industry is totally irrelevant right now because the you know, the governments of the world essentially have kind of let it let it drift and and and go and they're going to always just try and keep debasing relative to each other. And I think even the Treasury Secretary of the US said they want a weaker dollar, but we can't all have a weaker currency against each other, right? Like that just keeps going to zero. Uh and so you kind of have to look at fixed quantity things, you know, like Bitcoin and other cryptos. Yeah, I it's just it is interesting that Wall Street has really um you know, glombmed on to this recently. And yeah, to your point, you've been talking about this for many years and I noticed uh Muhammad Alian the other day tweeted out a chart of the S&P denominated in gold and Bitcoin, which is if you've been in the space on Twitter for a number of years, people have been tweeting that stuff out forever, but it's interesting to see it come from him. Uh and and I'm curious too, just to clarify your uh your discussion on being in a rate height cycle versus a cut cycle. Do you think that's what we ought to do or what is going to happen? Because if we're in the beginning of a rate hike cycle, I would imagine that markets have a little bit of room to fall from here. Yeah. So, um this is out of consensus, but I'm happy to be out of consensus. In December 2021, the um Fed funds rate was zero and the tenure note was 1.3. We put out our investor letter which is available to anybody in the room if they want to sign up for it saying that both of those would go to 5%. They did and I think they should stay and I said they would stay there for a long time. Fed fund should be 5%. The 10ear should be 5%. It I think it's a mistake to be cutting tricky. You're making me say whether they're going to admit they made a mistake and go the other way. 50/50, right? Like adults don't often admit they make a mistake and do the opposite. But um they really should. And so that's why I'm bullish crypto, right? If they want to cut rates when inflation's 3%. Massive housing inflation, massive inflation everything else like gold and h everything that's not directly in the CPI index, um they probably should hike, but given that they won't um or it's 50/50 that they do a hike, you just got to be long fixed quantity things like like crypto. um because I don't see any other way out. The the debt payments in the US are now bigger than military and other and definitely way bigger than education and infrastructure and all the other things one might want to spend on. So, you know, I'm curious. I I was watching a a clip from Paul Tudtor Jones the other day who said that we might be enter it might be everyone loves to say we're in this year or that year and he was making this comparison to 1999 this kind of big blowoff top you know before an eventual crash. I'm curious does that analog resonate with you? does it not? Yeah. So 99 uh was potentially a unique weird phenomenon. I was a tiger then and all the tech stuff.com stuff was going to crazy prices. I don't see that kind of craziness here uh in the equity market. I think equities are very overvalued relative to bonds is is what I would say that if you look at the 50-year average of the equity risk premium equities that have to fall 25% to be fairly valued versus the 50-year average. So, so I think equities are a bit expensive or probably bonds are way too expensive. The Fed bought 9 trillion of bonds. They manipulated the bond market. So, that is kind of the weird thing is that the Federal Reserve is manipulating rates and they they still are. So, I don't see a kind of.com explosion, you know, kind of epic thing that's going to happen in the next 12 months. I just see this kind of slow decay of like paper currencies versus, you know, hard money. Um, you know, so it's not going to be something you're going to read about in the newspaper tomorrow that, you know, Paul Jones is super smart guy and maybe he's right, maybe everything will blow up tomorrow. I think it's more of kind of a a slow decay and it's kind of a boil the frog thing, right? like you just don't feel it in uh this country has the oldest currency on earth, right? It used to be backed by a pound of sterling silver, right? They've printed so many pieces of paper, pound sterling. It takes 340 pieces of the paper ones to buy a pound of sterling silver. You just don't notice the decay, but it's there. Yeah. Well, then we're about to be out of time here, but I know you're raising fun five here, so if you could uh maybe close on just telling the audience a little bit about that. Yeah. So, uh, I I actually am as bullish on blockchain as ever. The the change in the regulatory system in the US really opens it up to allow, you know, companies to go public. We've had 25 companies become unicorns. You know, I think the next decade is even better than that. And what we did in our last fund is put all four asset classes together. So, venture equity, private tokens, special opportunities, and liquid tokens. And you can kind of move the capital from the expensive sector to the cheap sector, you know, during that. And in our uh current fund that we're almost done investing already has twice as many assets as the commitments that we got four years ago and we haven't even fully called the capital. So I think you know the blockchain space just has those kinds of opportunities that are you know really hard to get in kind of the normal markets and and the returns from our space over all this you know 12 years have just been you know off the charts and very low correlation the S&P 500. So any institutions out there which the majority of which still have 0.0 that's so important the majority of institutional investors have 0.0 you just got to get off zero. All right Dan this was a lot of fun. Thank you so much for coming and doing this. Guys, give him a big round of applause.