This episode unpacks the evolving landscape of crypto fundraising through innovative launchpads, the strategic integration of stablecoins by tech giants, and the transformative potential of AI agents, offering critical insights for navigating the future of Crypto AI.
1️⃣ Macro Market Outlook: Trump Tariffs and Short-Term Optimism
- The discussion kicks off with an analysis of the current market sentiment, influenced by geopolitical events like the Trump tariff pause on China.
- Host 2 suggests a potentially positive summer for markets, with the trade war temporarily on hold for about 90 days. This pause could lead to a mean reversion in technical charts, attracting more investment and FOMO.
- Host 2: "Short term looks like we're going to have a pretty good uh summer. I think the um the trade war is put on pause for at least uh 90 days."
- However, long-term uncertainty remains. The trade war isn't resolved, only in a "90-day ceasefire," and small businesses might continue to suffer, dampening animal spirits.
- Host 1 notes that even with tariffs, China remains a competitive manufacturing hub, suggesting costs might be passed to consumers, leading to slower growth.
- The speakers recall the 2018 trade war, where effective tariffs were around 12%, compared to the current 30% on Chinese goods entering the US, indicating a more severe situation.
- VIX (Volatility Index): A measure of expected price fluctuations in the S&P 500 Index options. Host 2 mentions a personal framework: "whenever the VIX hits 40 or above... you have to buy." This strategy was applied during a previous market scare related to the Yen carry trade unwind.
Actionable Insight: Investors should monitor the 90-day tariff ceasefire for short-term market opportunities but remain cautious about long-term impacts and potential GDP slowdown once tariffs are fully implemented.
2️⃣ The Rise of "Believe" and New Crypto Fundraising Models
- The conversation shifts to innovative crypto fundraising platforms, with a deep dive into "Believe."
- Believe: A platform enabling founders, particularly those with non-crypto startups, to launch tokens and secure funding. It aims to tap into "internet capital markets."
- Mechanics: Founders can launch a token by tagging "launchcoin" on Twitter. The Believe team conducts diligence before listing. A 2% trading fee on the token's market (launched on Meteora, a decentralized exchange protocol) is allocated to Believe, with a portion perpetually going to the founder.
- Founder funding is vested over time to prevent premature exits. Founders currently do not own a percentage of the token supply, making it a community-focused token, though this may change.
- Dupe.com Example: The founder of Dupe.com, an e-commerce site, launched a token and raised significant funding (e.g., $500-600k). Users can buy products cheaper with the Dupe token, and 90% of profits go to stablecoins, while 10% are used to burn the token, creating a deflationary alignment between sales velocity and token value.
- Host 1 highlights the platform's appeal: "Everyone thought crypto was scammy or it was useless tech but until they get the 200k in the bank. Exactly. And then they're like, 'Holy [__] crypto is one of the coolest things out there.'"
- Strategic Implication: Believe and similar platforms could democratize early-stage funding, allowing more experiments and potentially circumventing traditional pre-seed funds or grants, especially for AI and other tech startups.
3️⃣ The "Launchpad Wars": Competition and Strategies
- The discussion broadens to the competitive landscape of token launchpads, often dubbed the "Launchpad Wars."
- Pump.fun: A platform primarily targeting the creator economy, estimated to be a $250-500 billion market by 2027. It focuses on getting tokens out quickly, allowing content development on top.
- Believe's Niche: Positioned to target the "founder economy" or "venture founder economy," akin to a Product Hunt with a Kickstarter-like funding flywheel.
- Competitors to Pump.fun:
- Zora: Initially focused on content-first then token, their messaging is now more aligned with token launches.
- BOP (Build on Pomp): Reportedly founded by "Dingling" (claimed former CRO of Binance, though disputed by CZ). BOP employs a "vampire attack" strategy by airdropping tokens to users who claim them, aiming to draw liquidity and users from Pump.fun. It operates on Solana. CRO (Chief Revenue Officer) is an executive responsible for all revenue-generating processes.
- Luxbunk: Associated with the Bonk token team, focusing on launching memecoins, leveraging Key Opinion Leaders (KOLs) to drive liquidity.
- KOL Influence: The hosts note the significant role of KOLs in driving token liquidity, citing examples like Ansem for WIF, Andrew Kang (Mechanism Capital) for YFI (yearn.finance, a DeFi yield aggregator), and Uni PCS (a prominent trader) for Bonk, Fartcoin, and Popcat.
- Host 2 expresses skepticism about vampire attacks: "You can't win users over by just giving them money up front, right? You're just rewarding mercenaries."
Actionable Insight: Researchers should analyze the effectiveness of different launchpad strategies (KOL-driven, vampire attacks, organic community building) and their impact on token sustainability and founder success. Investors should be wary of purely incentive-driven platforms.
4️⃣ Big Tech's Crypto Embrace: Stripe, Meta, and Robin Hood
- The conversation explores how major tech companies are integrating crypto, particularly stablecoins.
- Stripe's Stablecoin Strategy:
- Integrating stablecoins to cut out banking middlemen, offering bank-like experiences using Stripe's infrastructure and bridges.
- Partnering with Ramp (a financial automation platform) to enable cards backed by stablecoins, similar to what Rain offers.
- Stripe sessions highlighted a graph showing plateauing digital payments versus hockey-stick growth in stablecoin payment usage.
- Impact on Startups: This move could render many stablecoin infrastructure startups obsolete, especially those focused on basic banking-like services. However, opportunities remain in emerging markets where Stripe has less penetration and for region-specific solutions (on/off-ramps, cross-border B2C payments, savings accounts).
- Host 2: "Stripe has had a hard time penetrating in uh emerging markets... every country is different that they have their own jurisdiction, their own financial system, their own user preferences."
- Stripe and AI Agents:
- Stripe is betting on a future where AI agents conduct online shopping. The vision is for users to interact with an LLM (Large Language Model) based AI agent that understands preferences and autonomously searches and pays for items.
- Kevin Weil, CPO of OpenAI, mentioned the potential for these agents to use crypto for payments.
- Meta and Robin Hood:
- News leaked about Meta potentially embedding stablecoins into its apps (WhatsApp, Facebook Messenger, Instagram payments), reminiscent of a "Libra 2.0" but leveraging existing infrastructure.
- This could significantly boost stablecoin adoption for P2P payments and e-commerce.
Strategic Implication: Crypto AI investors should watch for opportunities at the intersection of AI agents and crypto payments. Startups focusing on niche, region-specific stablecoin solutions in emerging markets (LatAm, North Africa, Turkey, India, SEA, Russia) may still thrive.
5️⃣ AI's Impact on Society: Education and Startups
- The discussion touches upon the broader societal impacts of AI, particularly in education and the startup ecosystem.
- AI in Education:
- AI tools are already being used by students for homework and tests, potentially making traditional education systems "semi-useless."
- Host 2 envisions schools becoming more like daycare centers, with real learning happening outside the system, possibly with AI tutors.
- A new model of private schools might emerge, focusing on basic math/reading for a short period, with the rest of the day dedicated to play and exploration (robotics, Legos).
- The emphasis shifts to fostering agency in children – letting them make decisions and learn from mistakes, with math and reading as non-negotiable basics.
- Personalized AI Tutors: Startups like "The After School" (in the Alliance batch) are building AI-driven personalized tutors that adapt curricula to individual student needs.
- The State of AI Startups:
- Concerns exist that OpenAI's rapid updates are "shutting down" many AI startups, especially "wrappers of wrappers" without strong network effects.
- An insider view suggests two dominant LLM models might rule the US market, potentially owning distribution through an "app store" model where OpenAI itself creates many of the apps.
- Host 1: "If OpenAI actually becomes an app store, that means by definition there's a bunch of apps... on top of it. And these apps are still startups." The counterpoint was that OpenAI might build these apps internally.
- Distribution is Key: For AI startups to survive, securing users and distribution channels is paramount.
Actionable Insight: Researchers should explore AI's role in personalized education and the development of high-agency individuals. AI investors should prioritize startups with strong distribution strategies or unique, defensible niches not easily replicated by large LLM providers.
6️⃣ Crypto's Evolving Role and Future Excitement
- The hosts express renewed optimism for crypto's potential, moving beyond speculative use cases.
- New Funding Mechanisms: Host 1 is excited about crypto enabling new funding for diverse sectors like nuclear research, drug discovery, donations, and robotics. The "on-chain premia" from speculation can fuel real-world innovation.
- Shifting Perceptions: While Silicon Valley has often been dismissive of crypto, Host 1 believes crypto is a "very serious player" if approached correctly.
- The Right Approach: Instead of forcing crypto into products (e.g., "crypto x AI"), startups should focus on product-market fit and then use crypto as a fundraising mechanism or a value-add, as exemplified by Dupe.com.
- Host 1: "Go find your product market fit. go get millions of users, billions of users, but just launch your launch a token that's tied in some shape to the product."
- Dupe.com's Model Revisited: The e-commerce site bypasses traditional retail markups by sourcing furniture directly from manufacturers in China and India, selling at significant discounts, similar to Temu or TikTok Shop's direct-to-source model.
Strategic Implication: Crypto AI investors and researchers should look for projects where crypto serves as a genuine enabler for innovation or funding in established or emerging non-crypto sectors, rather than being a forced integration.
7️⃣ Conclusion: Innovation in the "Boring Phase"
- The episode concludes by highlighting that true innovation often arises during "boring phases" in the market, free from hype and FOMO. This current period, despite its challenges, may be laying the groundwork for significant breakthroughs in how crypto and AI reshape industries.
Actionable Takeaway: Crypto AI investors and researchers should focus on projects with strong fundamentals and clear utility, particularly those leveraging crypto for novel funding or AI for transformative user experiences, as these are likely to yield long-term value beyond market cycles.
