[SPEAKER_00]: Today, we're joined by Samantha Lewis, partner at the Mercury Fund, and Sam invests at the intersection of FinTech Crypto, Financial Infrastructure, and recently led open trade $17 million round, which she co-hosts, and she also co-hosts money moves, where she covers the convergence of traditional finance and web three.
[SPEAKER_00]: Sam, welcome to the Crypto Maverick's really excited to have you on today.
[SPEAKER_01]: Thank you.
[SPEAKER_01]: I'm so excited to finally meet you.
[SPEAKER_00]: Yeah, as well, and we're excited to get things moving and talking about everything you're involved in, everything that you're talking about on money moves, talking about the mercury fund.
[SPEAKER_00]: But I guess we should just kick it off here, give us a little bit of a background of who you are, how you got involved with mercury.
[SPEAKER_01]: Yeah, so I joined mercury back in 2020 to be,
[SPEAKER_01]: The partner leading our financial infrastructure slash blockchain thesis.
[SPEAKER_01]: So I got into blockchain while I was in grad school.
[SPEAKER_01]: I went to grad squat rice in Houston while I was there.
[SPEAKER_01]: I was in the business school and a bunch of PhDs would hang out at this bar on campus.
[SPEAKER_01]: So I would go like hang out with the PhDs because, you know, most of the time they didn't want to hang out with the business school students.
[SPEAKER_01]: But once in a while, if we bought them beer, they'd like hang out with us and
[SPEAKER_01]: But we'd learn so much.
[SPEAKER_01]: So I would go and hang out with the PhDs.
[SPEAKER_01]: A lot of them were actually working on this was like 2017, 2018.
[SPEAKER_01]: A lot of them were working on like deep blockchain, cryptography type of work.
[SPEAKER_01]: Then I joined a family office group after that and we invested in deep tech.
[SPEAKER_01]: And so there was like a case to be made at the time, because, you know, at this time, like Ethereum had just launched a few years before, and everyone was trying to figure out what what is L1's mean, and there was an explosion of L1's, and it was really interesting to say, okay, like, where could there actually be real market here?
[SPEAKER_01]: Because,
[SPEAKER_01]: It's still this way, and I'm sure we'll get into this as we go, but there's like two very distinct areas of the blockchain space.
[SPEAKER_01]: There is the Wild West, what we call the Define Laboratory, where a lot of stuff gets to be experimented on and tested, and then some of that gets exported over to the broader financial system.
[SPEAKER_01]: Well, at the time, there was only the Define Laboratory.
[SPEAKER_01]: really.
[SPEAKER_01]: And so, what I was trying to figure out, what is commercialization?
[SPEAKER_01]: What do commercial use cases look like?
[SPEAKER_01]: Like what is the huge adoption curve we're going to get here?
[SPEAKER_01]: So that's what got me originally into it.
[SPEAKER_01]: And then Mercury is an early stage firm based in Texas.
[SPEAKER_01]: We do seed in series A.
[SPEAKER_01]: We have two very specific focuses.
[SPEAKER_01]: One is vertical AI applications.
[SPEAKER_01]: And one is financial services.
[SPEAKER_01]: And we always say the global financial system is getting an upgrade.
[SPEAKER_01]: And we're investing in the founders building there, which is all pretty much AI and blockchain infrastructure.
[SPEAKER_01]: So I've always been all my time.
[SPEAKER_01]: That's where I've been spending all my time for like eight years now.
[SPEAKER_01]: Super excited about what's happening right now in the market.
[SPEAKER_01]: This is very different from what they're cycle does.
[SPEAKER_01]: I think you probably be all in no to some good some bad, which is.
[SPEAKER_01]: an interesting, an interesting question we can debate as to why.
[SPEAKER_01]: But yeah, so that's mercury.
[SPEAKER_01]: So we like to lead deals and get really involved with the portfolio companies as they need us.
[SPEAKER_01]: And so open trade is a perfect example of what my thesis says.
[SPEAKER_01]: My thesis is assets.
[SPEAKER_01]: Um, the financial sort, like I just said, you know, the global financial system's getting an upgrade.
[SPEAKER_01]: And Web3 has already built a lot of that technology that requires the upgrade.
[SPEAKER_01]: And so then how did those two worlds combine?
[SPEAKER_01]: And there is so much to do within the, like,
[SPEAKER_01]: how these two worlds collide and how they converge.
[SPEAKER_01]: There's a lot of infrastructure that needs to be built.
[SPEAKER_01]: There's more application layers, stuff that needs to be built.
[SPEAKER_01]: There's just simple distribution mechanisms on how we get stable coins into more people's hands.
[SPEAKER_01]: There's the tokenization of everything, but we don't really need to have everything.
[SPEAKER_01]: So the tokenization of a lot of financial assets.
[SPEAKER_01]: So that's where we live.
[SPEAKER_01]: It's pretty nerdy financial services, stuff, and nerdy blockchain stuff, but it's quite fun.
[SPEAKER_00]: Amanda that stuff i'm a big nerdy block chain financial services improving the way of life i never thought my career path is a good down that way but it certainly has and that's what we love about it and another thing i love is interviewing
[SPEAKER_00]: individuals like yourself, people that are just absolutely brilliant and sharp and in the space and understand it and I can still steal lines from them and pass it off as my own, such as the global financial system who's getting an upgrade.
[SPEAKER_00]: I absolutely love that, but it's just so well.
[SPEAKER_01]: TM, TM, Mercury.
[SPEAKER_01]: No, I'm just kidding.
[SPEAKER_01]: Yeah.
[SPEAKER_01]: Of course, of course, we should not use it.
[SPEAKER_01]: We're starting.
[SPEAKER_01]: We're spreading the good word.
[SPEAKER_01]: We want everybody to be thinking
[SPEAKER_00]: It's true.
[SPEAKER_00]: It's a hundred percent true.
[SPEAKER_00]: Yeah, you should be.
[SPEAKER_00]: It's a hundred percent true.
[SPEAKER_00]: And, you know, you hit it there where you've spent, like, things of encryption in crypto, I guess, is like, you know, had this experimental side, then we have this, like, other foundational institutional side, but every day there's just something new happening in the space.
[SPEAKER_00]: And I know you keep it and talking a lot.
[SPEAKER_00]: You work with a lot of founders, you work with a lot of builders,
[SPEAKER_00]: that you've seen in the last cycle and you call it out just a moment ago that this cycles a little bit different than the cycles that we've seen before.
[SPEAKER_00]: So how has that changed the way founders are working in reacting?
[SPEAKER_01]: I think there's two, there's a lot.
[SPEAKER_01]: Let me talk about the two very specific things that I don't think gets talked about as much, okay?
[SPEAKER_01]: So founders in this space,
[SPEAKER_01]: look different, this cycle, then they did previous cycles, right?
[SPEAKER_01]: So a lot of times you had how long have you been in crypto?
[SPEAKER_01]: Like, I actually don't care about that anymore at all.
[SPEAKER_00]: Don't think that was such a cheap question.
[SPEAKER_01]: And everybody thought they were cooler because they came in in 2017 versus 2015 or vice versa.
[SPEAKER_01]: And it's just like, guys,
[SPEAKER_01]: stuff.
[SPEAKER_01]: Like, what matters is how much you know about the market you're selling into, right?
[SPEAKER_01]: So, for example, a lot of the founders we back, some of them are kind of like the crypto-nated regions, like open trade, you already talked about open trade.
[SPEAKER_01]: Dave is the CEO of open trade, him and his co-founder Jeff built one of the first big coin wallets from their college store,
[SPEAKER_01]: Okay, so like that went into the iOS app store.
[SPEAKER_01]: So these guys have been in crypto forever.
[SPEAKER_01]: And then I have other founders who were like big names like very impactful people on Wall Street that started tracking maybe retaliating some crypto early started tracking, hey, this technology super super interesting and I can understand how this can like be applied to my business and how it can supercharge our businesses
[SPEAKER_01]: Let me go and figure it out.
[SPEAKER_01]: Those people don't really care about the price of a bunch of bulk points.
[SPEAKER_01]: Those people care about the institutional adoption, and then how you make sure that you're using blockchain, most of them care still a lot about some of the properties of which probably we do permission lists versus permission, and all of these sort of questions we can ask, but it is okay that they're not crypto people.
[SPEAKER_01]: And so that's one, I think, and there's more and more people coming into the space because I think this space is being more open to those people too.
[SPEAKER_01]: So I think that that's actually really, really good things,
[SPEAKER_01]: what we're doing.
[SPEAKER_01]: So I always talk about how do you bring more sophistication to the space and how do you bring more institutionalization to the space?
[SPEAKER_01]: And so these are the two buckets through which I look at everything.
[SPEAKER_01]: The second point is this is really important.
[SPEAKER_01]: For our startups who were raising in 2020 or 2022, even kind of going into 2023, if you were saying, I am a blockchain enabled company.
[SPEAKER_01]: There were a lot of generalist investors that had no idea what to do with that.
[SPEAKER_01]: So they couldn't even really touch you.
[SPEAKER_01]: And then there were, so they were like, but what is traction look like?
[SPEAKER_01]: And why does it?
[SPEAKER_01]: It just looked very different from a SaaS world.
[SPEAKER_01]: That's out the window now because of AI.
[SPEAKER_01]: So that's changing.
[SPEAKER_01]: But the other problem was on the crypto fun side of things.
[SPEAKER_01]: They wouldn't invest in you unless you had a token warrant.
[SPEAKER_01]: Because they had to be able to say, I'm gonna get the liquidity on crypto timelines.
[SPEAKER_01]: not on traditional venture timelines.
[SPEAKER_01]: So traditional venture timelines, you invest in an equity of the company and you expect somewhere between 5 to 10, 15 years before you can fully liquidate that position.
[SPEAKER_01]: Cryptophons are obviously very different because it's much more of a liquid market.
[SPEAKER_01]: And so all these founders that were trying to build at the intersection of the two were really stuck because it was really hard to get money because crypto funds are incentivized by tokens.
[SPEAKER_01]: make up why they needed a token, which never made any sense.
[SPEAKER_01]: And then when like web2 regular SaaS funds, we're like, why are you talking to me about a token?
[SPEAKER_01]: That doesn't make sense.
[SPEAKER_01]: It's just really difficult for founders building up the convergence.
[SPEAKER_01]: that's all kind of gone away because there's enough like big capital that doesn't care about token war in anymore on the crypto side someone still do but someone don't and then there's enough there's been enough maturation of the market to where some funds like mercury mercury is not a crypto fund we don't really do liquid where we have one or two liquid positions that's it
[SPEAKER_01]: And so we can now come in in more force, like 40%, 40% to 45% of the fun we're currently investing out of will go into the space.
[SPEAKER_01]: And that's like, that's a big thing to say for traditional funds who weren't really in who for traditional funds in general.
[SPEAKER_01]: So.
[SPEAKER_00]: Yeah, that's an amazing breakdown of the past cycle and where we're on this cycle.
[SPEAKER_00]: And some things that stuck out to me is that we'll become a little bit more sophisticated.
[SPEAKER_00]: That's for sure, because I've been in the space for a long time, and it's, you know, we can all tell our war stories from past cycles and just kind of how...
[SPEAKER_00]: Like, there still is.
[SPEAKER_00]: There's like another language in crypto, but past cycles, it's like if you didn't talk in the language of crypto, we weren't as like adopting is, but we need that we need to bring people into the into our space, into our world and show them all the technology exactly what we can do.
[SPEAKER_00]: And there's obviously been.
[SPEAKER_00]: more maturing, especially with the institutional interest.
[SPEAKER_00]: And that's what we want here as a bigger picture.
[SPEAKER_00]: But something I really want to call out here.
[SPEAKER_00]: We talked about the center of the show.
[SPEAKER_00]: It's Mercury recently co-led open trade 17 million dollar round, which is absolutely huge.
[SPEAKER_00]: What was the core thesis behind this initial investment?
[SPEAKER_01]: Yeah, so open trade, I'll explain what open trade is and then I'll tell you why it was so important to our thesis so open trade is an API infrastructure company that allows Neil banks and fintechs all over the world to offer their customers compliant yield.
[SPEAKER_01]: So if you are a FinTech and say Columbia, your Neo-Bank and Columbia, you're competing with a lot of other banking alternatives.
[SPEAKER_01]: And you are like, how do I get more customers to sign up on my platform by using open trade, which again, just like an API infrastructure and like integrating that into your technology.
[SPEAKER_01]: Now you can give all sorts of different types of yield products to your end users with the click of a button.
[SPEAKER_01]: So you know how easy it is for us on Coinbase to go in and lend our crypto using more foe, like because Coinbase has plugged that in with more foe or how easy it is for us to just like, lend our USDC or stake or whatever, it has not been that easy to get yield on stablecoins.
[SPEAKER_01]: So people all over the world want to save in US dollar denominated credit products or just simply US dollars and they haven't really been able to do that before.
[SPEAKER_01]: And so you could hold together, but of course you weren't getting yield on to other unless you understood the defy ecosystem.
[SPEAKER_01]: So a lot of these fintechs tried to do it themselves and still some of them do try and what they quickly realize is like it takes so much sophistication on how you can create all these different vaults.
[SPEAKER_01]: that you should just use open trade for it.
[SPEAKER_01]: So open trade is an incredible company.
[SPEAKER_01]: They've been growing somewhere between 15 to 20% month over month for the last 20 months.
[SPEAKER_01]: So they're just on an absolute rocket ship.
[SPEAKER_01]: Their customers love them.
[SPEAKER_01]: They've never turned to customer.
[SPEAKER_01]: Besides one time, a customer shut down because it was like a early stage startup.
[SPEAKER_01]: So like every it's just such a good company why this was a relevant to Mercury.
[SPEAKER_01]: So I said the the big broad strokes of my thesis, which is
[SPEAKER_01]: the convergence of triadfi and web 3.
[SPEAKER_01]: Within that convergence, there are two very, very, very important things, which is our WAs, tokenization of all financial assets, and then there's stablecoins, which is an RWA, but I separate them out.
[SPEAKER_01]: So when I thought about stablecoins and I've been investing up and down the stablecoins stack already for years by time in that,
[SPEAKER_01]: by time I met Dave and the open trade team was I was like what is next?
[SPEAKER_01]: Or anything about payments?
[SPEAKER_01]: Or anything about settlement?
[SPEAKER_01]: We're already thinking about the use that easy use case of stable coins and I'm like but in a world in which stable coins proliferate.
[SPEAKER_01]: like what else you need and it became quite clear to me that that was going to be old.
[SPEAKER_01]: Like how can you earn on your stable points?
[SPEAKER_01]: And so I met Dave, I met him through the avalanche team.
[SPEAKER_01]: They built on avalanche.
[SPEAKER_01]: I met him through the avalanche team and I got off like a 30 minute call and I called my partner and I said, I found the next deal, we got it.
[SPEAKER_01]: It's like, when you talk about your doctor for 30 minutes, I was like, dude, this is it.
[SPEAKER_01]: You know, and I walked him through it, and I've been talking to them so much about how you earn on these now digital assets.
[SPEAKER_01]: And they got it right away.
[SPEAKER_01]: And Dave wasn't even raising money.
[SPEAKER_01]: I begged him to take my money.
[SPEAKER_01]: So he let me put a little bit in.
[SPEAKER_01]: And then once the company really, really started picking off and they wanted more money, then we came in and much, much more force with my friends, a rent, and we should in capital, and all the following investors, including injuries,
[SPEAKER_01]: Draper Dragons, MCC and Albion, so it's a good company, I'm super excited about it.
[SPEAKER_00]: Amazing, and I urge everyone to check it out because obviously, well, stable coins have been the talk in the town for the past year.
[SPEAKER_00]: It's one of those buzzwords in our space, but for good reason, and we got a lot of genius acts.
[SPEAKER_00]: And hopefully the clarity act, we got a lot of things there to go.
[SPEAKER_00]: Yes.
[SPEAKER_00]: We'll be pushing the bus to that next level.
[SPEAKER_00]: And that kind of thing.
[SPEAKER_01]: You want to be interesting though, sorry, I don't want to take too much off.
[SPEAKER_01]: I don't want to take too much off.
[SPEAKER_00]: I'm a big off the, off the track type of guys.
[SPEAKER_00]: So whatever you want to talk about.
[SPEAKER_01]: Well, it was based on some of the things I was doing to prep for a conversation and I'm like, okay, what am I supposed to say about?
[SPEAKER_01]: And of course last year at this time, I was, I actually was like two weeks postpartum last week at this time, so I just had a baby.
[SPEAKER_01]: But I still am obsessed because a circle IPO was happening and there was just so much happening in our space, genius out to just pass or I think was just about to pass.
[SPEAKER_01]: And you know, where was just so much buzz?
[SPEAKER_01]: And it's like stablecoins found product market fit.
[SPEAKER_01]: which I do believe, I still believe that.
[SPEAKER_01]: Yet, go to rwad.xyz and guess what?
[SPEAKER_01]: From like Q3 until right now, the market cap hasn't really grown.
[SPEAKER_01]: disabled ones.
[SPEAKER_01]: And so that was one of the big bullish momentum thought cases when you think macro was stablecoins were growing like absolutely crazy percentages.
[SPEAKER_01]: Well now our market cap has hovered about the same for now three quarters for quarters, not quite four quarters.
[SPEAKER_01]: And so why?
[SPEAKER_01]: I don't know.
[SPEAKER_01]: I think that's a really important part for us to be thinking about as people who are who care about the space we're building in the space we're investors in the space.
[SPEAKER_01]: With that being said, transaction volume is still going up.
[SPEAKER_01]: With that being said, there's still more institutional adoption.
[SPEAKER_01]: There's more stuff you can do with stablecoins.
[SPEAKER_01]: So that is naturally going to grow the market.
[SPEAKER_01]: It just has only grown and it might be
[SPEAKER_01]: because stablecoins are still a big part of the crypto trading ecosystem is sure that's what it is.
[SPEAKER_01]: But we need to still keep digging and see if it's something else that we need to uh, we need to be building it.
[SPEAKER_00]: Yeah, that's a great call.
[SPEAKER_00]: I'm checking it out right now.
[SPEAKER_00]: That's that's very insightful.
[SPEAKER_00]: That's a wonderful call out.
[SPEAKER_00]: So so I guess like back to like the stablecoins and stablecoin yield, what do we need for these products to truly go mainstream?
[SPEAKER_00]: To have adoption to people to just like believe in stablecoins and kind of the vision that a lot of people in crypto have had for a very, very long time.
[SPEAKER_00]: What do we need just to retail customers to see to really move forward?
[SPEAKER_01]: Well, a lot one thing is like I don't know if we can even change this one, so it's kind of stupid to say it, but I mean, you have to say it's like to get mass adoption of crypto and what we think crypto, I'm not talking about the broader digital asset because so I'm not talking about, you know, a digital representation of a treasury.
[SPEAKER_01]: I'm not talking, I'm not talking about a stable coin.
[SPEAKER_01]: I'm not necessarily even talking about a digital representation of a private credit product.
[SPEAKER_01]: You know what I mean?
[SPEAKER_01]: Because those are all very clear already business models or already financial products that work in the financial system and all we're doing is upgrading them with a technology.
[SPEAKER_01]: That's like, that is going to drive mass adoption on itself, okay?
[SPEAKER_01]: is naturally going to grow because now there's a better way to package these products and why because every institution wants to put their assets on chain, why?
[SPEAKER_01]: Because now you have global distribution in a way you never had before.
[SPEAKER_01]: So that makes every single global citizen.
[SPEAKER_01]: I can't even remember how many people are on this globe, but billions, right?
[SPEAKER_01]: Now you have billions of people that can buy your product, where before you've had maybe just if you won't leave distributed in the US, and you have, you know, 325 million people.
[SPEAKER_01]: So now that universe of buyers is so much bigger, but of course they want to, of course they want to tokenize, and then push those distributions out.
[SPEAKER_01]: That's one side.
[SPEAKER_01]: I believe that that is like a natural progression of what's going to happen.
[SPEAKER_01]: How do you get retail and how do you get other people to care more about than the like more specific crypto markets and when I'm saying the crypto markets, I'm talking Bitcoin and all coins mostly.
[SPEAKER_01]: Volatility.
[SPEAKER_00]: Yeah, that's what they're saying.
[SPEAKER_01]: Like I don't even say it because it's like, how do we change it?
[SPEAKER_01]: You know, I don't know.
[SPEAKER_01]: We change it.
[SPEAKER_00]: Yeah, it's true.
[SPEAKER_00]: We like we like fall Authority.
[SPEAKER_00]: Right.
[SPEAKER_01]: And if you see Bitcoin at 120 and then you're at 60 and was your first cycle and you came in.
[SPEAKER_01]: You're like, shit, did I just get doomed?
[SPEAKER_01]: Or shit, are other people getting rich and not me?
[SPEAKER_01]: And then once they dig in a little bit more and they start to understand the ults, they're like, oh my God, now I know what a rump will is.
[SPEAKER_01]: Oh my god, like, what, yeah, right.
[SPEAKER_01]: So then they're like, hey, are all the VCs actually just front running the returns and then retail's left holding the bags.
[SPEAKER_01]: And so like that is why it's really, really hard to grow the amount of people who are crypto investors in my opinion.
[SPEAKER_01]: To be honest though, I mean, we can't go this well up so without talking about SpaceX.
[SPEAKER_01]: Since it's, yeah, we're happening now, but like I was watching a video this morning about all the different unlocked periods of the core holders, right?
[SPEAKER_01]: So it's like Andrews and Valor, of course, Elon and a few of his executives founders fund and it's like when they get to start unlocking that when we're going to know.
[SPEAKER_01]: what the real valuation is.
[SPEAKER_01]: And so maybe, or we did we take something from the crypto markets, which is retail is often left holding the bag after VCs dumb.
[SPEAKER_01]: And we're just putting that into that equity markets now with SpaceX.
[SPEAKER_01]: I don't know.
[SPEAKER_01]: We're going to wait and see.
[SPEAKER_01]: But overall, what are retail investors carried about right now?
[SPEAKER_01]: They care about returns.
[SPEAKER_01]: And the thing where they think returns are is actually in the equity markets in AI.
[SPEAKER_01]: So I think they can understand better than sometimes they can understand the crypto projects.
[SPEAKER_01]: So the crypto industry needs to need to take hard look and really think about how you protect the people who are in your ecosystem.
[SPEAKER_00]: I mean, the equity markets in the AI market, I mean, over the past a couple months here, especially has been absolutely wild trade for people that were in it, and I followed it very closely because of kind of what we do, and I'm very interested in the SpaceX IPL as well.
[SPEAKER_00]: You know, I was looking at the unlocked periods and just trying to get a grasp because I do believe there's some liquidity and I think this is a common theme that there's a lot of liquidity that was pulled from a lot of markets.
[SPEAKER_00]: I mean, we got,
[SPEAKER_00]: I mean, people take it out more than just second mortgages for the SpaceX IPO, and I'm like, I don't know if this is just like a clickbait or joke, or if that's really happening, but I'm not a financial advisor, but seems, seems risky, but who knows, there's a lot of ways, there's a lot of ways this could go for sure.
[SPEAKER_00]: because the unlock period is interesting.
[SPEAKER_00]: I think it's something like initially like the plays can sell like 5% of it and then like the first three months it gets a really sort of fall off a cliff but where's that?
[SPEAKER_00]: Where's that capital going to flow?
[SPEAKER_00]: Like I'm sitting here just like looking at it and it does feel like a perfect setup for crypto.
[SPEAKER_00]: Like maybe I have to like take like my bullish hat off sometimes because I'm like man is this feel like this could flow into our market.
[SPEAKER_00]: But I really don't know.
[SPEAKER_00]: I hope that's the kind of thing.
[SPEAKER_01]: I don't know either.
[SPEAKER_01]: I think there's a really important part to that, right?
[SPEAKER_01]: Is that why did people use to invest in crypto in the, let's call it earlier days, maybe just last cycle, even, maybe just the beginning of the cycle.
[SPEAKER_01]: But like, it's because they thought that they can get outlier returns.
[SPEAKER_01]: And that's why people came in, because they thought that they can get outlier returns and many people did many people lost and many people won that's the way of markets.
[SPEAKER_01]: Now people believe they can get that in a regulated equity market.
[SPEAKER_01]: So I don't know what that means for liquid crypto over time, over time, I'm obviously max bullish on it, but I think crypto and the crypto currencies associated with the business models in crypto specifically, not this convergence right, typically live.
[SPEAKER_01]: We're going to have to continue to rework it, but that's why I call it a defy laboratory because it is like we live in pure experimentation over there, which is great, I think there's so much innovation.
[SPEAKER_01]: It's going to get figured out.
[SPEAKER_01]: I just don't really know exactly what it's going to look like.
[SPEAKER_01]: And so when you think about the max bulls on SpaceX, right, they think one point eight trillion dollars is cheap.
[SPEAKER_01]: They think that is cheap.
[SPEAKER_01]: So that means they think they can get how we're law returns.
[SPEAKER_01]: What we have to care about in venture, what a lot of crypto people care about.
[SPEAKER_01]: You can get outlier returns by investing in.
[SPEAKER_01]: pretty much the most valuable IPO of all time.
[SPEAKER_01]: I don't know because the Unlocks and because of other things and because the systemic risk to the market, which is really how much collateral is gonna be inserted into the markets now that you can trade against, I mean, now that you can borrow against SpaceX stock, so that's the max bullcase.
[SPEAKER_01]: And they're like that's because we're gonna be a space-faring society.
[SPEAKER_01]: Pull man, I'm reading red rising right now.
[SPEAKER_01]: I love sci-fi.
[SPEAKER_01]: I don't know.
[SPEAKER_01]: I don't know if we're going to be a space fairy in society.
[SPEAKER_01]: Right.
[SPEAKER_01]: So I think it's just really interesting, but it's like the innovators and the believers and the people who drove crypto to where we are now are now kind of thinking about their next frontier.
[SPEAKER_01]: And so it makes sense to me that SpaceX has very attractive to dreamers and believers and builders who want to build for the future.
[SPEAKER_00]: I mean, it's going to be hard to carry all our physical gold to Mars.
[SPEAKER_00]: So you might as well just bring digital gold on your spaceship.
[SPEAKER_00]: I don't, it's, it's a definitely an interesting time.
[SPEAKER_00]: And today in particular with the SpaceX IPO, and there's been a lot of interesting products that have come out like with using crypto rails, like hyper liquids, for instance.
[SPEAKER_00]: You know, it's so interesting.
[SPEAKER_00]: Yes.
[SPEAKER_00]: I remember when the first came out, I was like, this is a cool platform.
[SPEAKER_00]: This is super neat, and you know, you're able to get exposure on SpaceX early, long and shorting it, and then you start utilizing, and then you got like prediction markets, and what they're building, and it's, it's interesting how these are just coming up in this new cycle, and the doggings of the cycle, but for good reason.
[SPEAKER_00]: Well, parts of what parts of traditional finance do you think really are like, and we're already seeing it, but from your opinion, are really likely to move on chain first and just stay there where people are like, yep, this makes sense.
[SPEAKER_00]: This is where we're going.
[SPEAKER_01]: Yeah, the the low hanging fruit, which is already there as you alluded to, but it's not there in full in full volume that it could be is the easiest thing to do, which is money market funds US dollars.
[SPEAKER_01]: Right.
[SPEAKER_01]: Those are fairly simple.
[SPEAKER_01]: Everybody, I think, probably everyone in the world this might be hyperbolic.
[SPEAKER_01]: Most people in the world know what the US dollar is.
[SPEAKER_01]: Right.
[SPEAKER_01]: So like, okay, tokenizing the US dollar.
[SPEAKER_01]: is a very low hanging fruit.
[SPEAKER_01]: And that's not to say it wasn't really tough to get here with the building and the rails and everything else we had to do to get there.
[SPEAKER_01]: But you know, that's fairly low hanging fruit.
[SPEAKER_01]: That is what I think is here to say that's gonna continue to grow.
[SPEAKER_01]: And it's because you want to export US dollars.
[SPEAKER_01]: And this is why the genius bill was a bipartisan bill.
[SPEAKER_01]: It is in America's best interest.
[SPEAKER_01]: We're sitting here in America.
[SPEAKER_01]: So it's easy for us to be bullish on this.
[SPEAKER_01]: But it is in America's best interest for the dollar to be used to continue to settle all trade or the dollar to be used for people to hold in earn.
[SPEAKER_01]: There is a lot of that there's a pro in con to it with sanctions, a vision, and other things like that, but like.
[SPEAKER_01]: The jury saw whether like how effective sanctions really are with US dollar and swift system, we're watching it in Russia right now.
[SPEAKER_01]: But overall, I think it's fair to say, it's very bullish on America dollar supremacy for stablecoins.
[SPEAKER_01]: And so that's why you see that and that's why you're going to continue to see that.
[SPEAKER_01]: And I don't think that's going to be a partisan issue.
[SPEAKER_01]: If it is, that's crazy.
[SPEAKER_01]: I just don't think it's going to be.
[SPEAKER_01]: What the other things are,
[SPEAKER_01]: The next things that really aren't partisan because you have to we have to consider like where's regulation going and what's partisan what's not partisan because I think that tells us where kind of like the next big jump we're going to get.
[SPEAKER_01]: It's not that hard now to tokenize a lot of different assets.
[SPEAKER_01]: Like I said, there's all these financial assets that already exists.
[SPEAKER_01]: Private credit is a really good one.
[SPEAKER_01]: Private credit, there's all sorts of different subsets of credit.
[SPEAKER_01]: Private credit, some of it's better to tokenize than others.
[SPEAKER_01]: But generally, tokenize private credit, and now you have a much bigger pool of investors.
[SPEAKER_01]: That's also good for America, because that's good for Wall Street.
[SPEAKER_01]: And so,
[SPEAKER_01]: That I think is pretty obvious going to be the next thing, right?
[SPEAKER_01]: And when we look at how big market caps can be of stablecoins versus RWAs, I can't even remember what the number is, but it's like, I think it's 16 trillion.
[SPEAKER_01]: I think BCG came out and said by like 233, there could be 16 trillion dollars of RWAs.
[SPEAKER_01]: That's so huge, like so huge.
[SPEAKER_01]: There's not even like, they talk about US dollar stablecoins being very trillion, you know, that Scott Bissett doesn't cannot say that.
[SPEAKER_01]: Okay, that's max bullish.
[SPEAKER_01]: And then you've times up by five, and that's where RWAs can be.
[SPEAKER_01]: Like for sure, we gotta figure out RWAs.
[SPEAKER_01]: It's the next big thing.
[SPEAKER_00]: Yeah, 16.1 trillion by 2030, 10% of the global GDP.
[SPEAKER_01]: That's astounding.
[SPEAKER_00]: That's a lot.
[SPEAKER_00]: I hope that's the face.
[SPEAKER_00]: That's the end.
[SPEAKER_00]: No, too.
[SPEAKER_00]: I hope it is.
[SPEAKER_01]: I don't know if we're going to get to 16 trillion, but guess what?
[SPEAKER_01]: Even if we miss that by 3x, still doing pretty damn good.
[SPEAKER_00]: You know, I mean, 20 30 isn't that far away, either.
[SPEAKER_00]: You know, it felt like that years ago.
[SPEAKER_00]: But now in some of this 20 30, I'm like, I'm like, that's tomorrow.
[SPEAKER_00]: Yeah, I mean, in crypto days, you know, by lifetime, but, you know, in the regular time, it's, it's a, it's a program.
[SPEAKER_01]: What do you think Bitcoin's gonna be at?
[SPEAKER_01]: When RWA's reached 16 trillion in 2030.
[SPEAKER_00]: Oh my gosh.
[SPEAKER_00]: I mean, probably high six figures, you would imagine.
[SPEAKER_00]: I mean, I can make an argument for anywhere.
[SPEAKER_00]: You know, I really could make an argument for, I could go Max Bullish, and I could even take a bearish take.
[SPEAKER_00]: But I'm kind of a permable with Bitcoin and where we're going, and if we're going to 16 trillion, I'm sure there's some napkin math I could do, but what's your call?
[SPEAKER_00]: Well, instead of just tell me what Bitcoin's gonna be a 2030, you don't want to sharpen people pat on the podcast, tell me what I do.
[SPEAKER_01]: Oh my gosh, if I knew, right, if I knew we were ready to find our yachts, um, I'm with you.
[SPEAKER_01]: I think there's, there's a bullcase in the bullcase is people really see Bitcoin as a store value.
[SPEAKER_01]: Um, that is still up for debate.
[SPEAKER_00]: Yeah, it didn't shake out.
[SPEAKER_00]: I hate it.
[SPEAKER_00]: I didn't shake out this clean this cycle.
[SPEAKER_00]: We were hoping.
[SPEAKER_00]: I still, I still see it.
[SPEAKER_01]: But I did, and that's a thing like whether we see it, it doesn't really matter.
[SPEAKER_01]: for it to work, right?
[SPEAKER_01]: And so it's like, okay, is Bitcoin is more about you.
[SPEAKER_01]: If Bitcoin submensit self as a sort of value, high six figures, I think probably somewhat accurate, right?
[SPEAKER_01]: We're going in that direction.
[SPEAKER_01]: Here's the issue.
[SPEAKER_01]: Bitcoin as a sort of value, it directly now competing with what the world already sometimes thinks of even though it shifts and it changes a little bit.
[SPEAKER_01]: You've already think of the US dollar as a sort of value.
[SPEAKER_01]: And now you can anyone anywhere with an internet connection can hold a U.S. dollar and earn yield on a U.S. dollar.
[SPEAKER_01]: So if stablecoins reach $3,000 by 2030, is that taking direct market share away from Bitcoin?
[SPEAKER_01]: There's more politics associated with the U.S. dollar, obviously.
[SPEAKER_01]: There are regimes that do not want to hold our dollars, but how much is that of the total amount, you know, a Bitcoin holders, I don't know.
[SPEAKER_01]: But that's what I'm watching.
[SPEAKER_01]: When I think about Bitcoin, I'm sorry about you.
[SPEAKER_01]: It's like if that's the argument that Bitcoin maxies like to make or just Bitcoin enthusiasts like to make.
[SPEAKER_01]: Okay.
[SPEAKER_01]: then now you're competing directly with a digital U.S. dollar where before you were just competing with Fiat.
[SPEAKER_01]: And I guess you're still in Fiat, but now it's very easily to export hold and earn on it.
[SPEAKER_01]: So that's what I'll be watching.
[SPEAKER_00]: Yeah, I mean, I guess you could make the same argument about like gold.
[SPEAKER_00]: I mean, it's gold was flat for years and years and years and it started to go up and show itself as a store value, but you could kind of make the same argument there.
[SPEAKER_00]: where I'd imagine just a more adoption with crypto rails, more adoption with blockchain, 16 trillion and RWA's.
[SPEAKER_00]: That you're going to, it's going to be harder than this today.
[SPEAKER_00]: I mean, I think that it feels extremely undervalued if that's the case.
[SPEAKER_00]: But I hear what you're saying.
[SPEAKER_00]: There'll be some really interesting opportunities there and something that I think investors need to be super fluid with.
[SPEAKER_00]: and just watch the market and get a good idea of where the vibes are going.
[SPEAKER_00]: But 16 trillion by 2030, I don't think we'll all have plenty of opportunity to get our fair share.
[SPEAKER_00]: You just have to, you know, can't fall asleep with the wheel.
[SPEAKER_01]: that's what I'm excited about.
[SPEAKER_01]: So even if we didn't get the all season that we were expecting and we're holders of a few all coins plasma being one of them right and if we we didn't get the all season we all I think wanted but
[SPEAKER_01]: Where we're seeing the glimmers of hope are on the things you've already brought up.
[SPEAKER_01]: Hyperliquid is a really good one.
[SPEAKER_01]: Why is Hyperliquid valued and continuing to go up and value in other altzarn?
[SPEAKER_01]: And I think it has to do with a fundamental story, which is investors are starting to care more about fundamentals.
[SPEAKER_01]: They're starting to care more about what, like, what are your competitive modes?
[SPEAKER_01]: They're starting to care more about the actual business logic that we've always had to bring in to the world.
[SPEAKER_01]: So the worlds are going to start looking a little bit the same on how traders are making these decisions.
[SPEAKER_01]: and I'm not a trader.
[SPEAKER_01]: So I'm an early stage VC and those are two very different things.
[SPEAKER_01]: So I don't know.
[SPEAKER_01]: I would love a trader's perspective here, but I just think, while if there is not max outlier return potential anymore in just liquid crypto markets as they say I'm now, you know what's great about that?
[SPEAKER_01]: The innovators are going to figure out how they go and make more money.
[SPEAKER_01]: That's why capitalism is like the best system.
[SPEAKER_01]: It has its condabs.
[SPEAKER_01]: Absolutely, but that's why it's a best system.
[SPEAKER_01]: Because now a bunch of smart people are going to
[SPEAKER_01]: with this technology, and that's what's going to drive the next wave of innovation in our space, and I think it will be fun to watch.
[SPEAKER_01]: We should chat again every year and be like, hey, what did we say last year?
[SPEAKER_01]: How right or wrong were we?
[SPEAKER_00]: Yeah, I know.
[SPEAKER_00]: You can go back to you to fact check me on a few things.
[SPEAKER_00]: That's that's definitely true and hyper liquids.
[SPEAKER_00]: How you can per liquid?
[SPEAKER_00]: I mean, it gets it's getting a lot of credit now for good reason.
[SPEAKER_00]: People like when the price goes up, you know, just like a week or two ago, we're like in all time high and everybody was absolutely loving it.
[SPEAKER_00]: interesting tokenomics.
[SPEAKER_00]: I mean, they make a lot of money.
[SPEAKER_00]: They do it 99% buyback and burn, something that we, you know, I've never said the word flywheel more this past year than my entire life.
[SPEAKER_01]: I'm just like, flywheel this, flywheel that, buyback and well, we're into the VC world because it's all we ever talk about.
[SPEAKER_00]: So it's great.
[SPEAKER_00]: Yeah, and it's the truth.
[SPEAKER_00]: So we're seeing a lot of innovation, a final question here because I know you're busy, but what do you think is let's talk about the past year?
[SPEAKER_00]: You know, we just talked about we got fact check ourselves in a year from now what would make you more bullish on crypto over the next 12 months or where we headed over the next year.
[SPEAKER_01]: Oh my, okay, given the conversation we just had of course I have thoughts, but now I have to process everything we just talked about.
[SPEAKER_01]: So where are we going to be in the next year?
[SPEAKER_01]: Hopefully, clarity will pass by clarity passing that will make that will make institutions feel better to come in in more force.
[SPEAKER_01]: Institutions are already scurrying around.
[SPEAKER_01]: They have been in a patient budget's put into this, but are they putting like full resources into it?
[SPEAKER_01]: No, and now they're now ripped on its own as having to compete with AI, but when you combine both, and you think about the world of agentic finance, which is where I really spend a lot of my time, it's the world of agentic finance is driven by two key key things in it's AI and it's blockchain infrastructure.
[SPEAKER_01]: and it's settlement and using digital assets to be able to do that.
[SPEAKER_01]: So I think we're going to continue to see an explosion of innovation when it comes to this convergence of TradFi and Web3.
[SPEAKER_01]: And hopefully, of course, where I want us to be, is we take the best of both worlds and put that into a new global financial system.
[SPEAKER_01]: It's not going to be exactly that.
[SPEAKER_01]: We're going to have some of the shit that exists and try to find some of the shit that exists in web theory.
[SPEAKER_01]: And we're going to keep trying to build the Lego blocks.
[SPEAKER_01]: But it's all about building.
[SPEAKER_01]: And that's what we're doing.
[SPEAKER_01]: So I think institutional adoption continuing to be up.
[SPEAKER_01]: I've no idea where crypto prices are going to be.
[SPEAKER_01]: Again, not a trader.
[SPEAKER_01]: So I'll leave that one to you.
[SPEAKER_01]: But institutional adoption going up is a very, very good thing for for the blockchain industry, but not necessarily directly related to altcoin prices.
[SPEAKER_00]: Yeah, thanks a lot of sense of we can do another whole podcast that I can't believe we barely talked about Egentic finance.
[SPEAKER_00]: That's probably one of my favorite things about the entire crypto world and I see this whole path of like the bullcase of where crypto can absolutely pop off because the AI is successful and these aliens and transactions and micro transactions and I'm like, oh, this could be interesting and bring a lot more eyeballs at least to the space.
[SPEAKER_00]: Exactly.
[SPEAKER_00]: Sam, you're the best.
[SPEAKER_00]: Absolutely amazing.
[SPEAKER_00]: Definitely need to have you on the podcast.
[SPEAKER_00]: You're soon again.
[SPEAKER_00]: I know you're busy and you got some things to do.
[SPEAKER_00]: So hate to cut it a little short, but you're amazing.
[SPEAKER_00]: We'll get you back on the podcast, but before we go, I want to give an opportunity for people to learn more about you, learn more about mercury, everything about your talks.
[SPEAKER_00]: It's just so they can find and learn more about you.
[SPEAKER_01]: Yeah, I would love, I would love for everybody to also if you want deep dives, which is really what we do on the podcast.
[SPEAKER_01]: I just launch a podcast called Money Moves and very different from what Brian and I are talking about today.
[SPEAKER_01]: Well, no, it's the same thing what we're talking about today, but we sometimes will go an hour.
[SPEAKER_01]: We'll sometimes go an hour and a half.
[SPEAKER_01]: No, I don't think we've ever felt at least an hour 15 minutes because we do deep deep dives into all the things we've covered today.
[SPEAKER_01]: So that's the idea, it's what two of my CEOs and my portfolio, one's a former macro trader, very successful macro trader, and the other one's the CEO of OpenTrade, which we already covered here, and we just do a weekly podcast to do super deep dives and what's happening in capital markets and digital finance, agentic finance and the rest.
[SPEAKER_01]: Just deep dives into the innovation economy with all the things we care about.
[SPEAKER_01]: So we'd love to have you all tuned in there.
[SPEAKER_01]: Once we start bringing on gas, we just launched it.
[SPEAKER_01]: Once we start bringing on gas, though, right, it would be awesome to have you on.
[SPEAKER_00]: Oh, I would love that.
[SPEAKER_00]: I mean, I'm literally as if we're doing it right now.
[SPEAKER_00]: I'm going to become a listener and a subscriber here to money moves.
[SPEAKER_00]: I absolutely love this interview and I think that's going to be, that's going to go into my role in decks of things to listen to.
[SPEAKER_00]: So amazing.
[SPEAKER_01]: Awesome.
[SPEAKER_01]: Well, appreciate it.
[SPEAKER_01]: We have plenty more to talk about.
[SPEAKER_01]: Let's keep going.
[SPEAKER_00]: Alright.
[SPEAKER_00]: Thanks again.
[SPEAKER_00]: Bye.