This week, we’re back with Daniel Shapiro from Blockworks Research for our annual deep dive into Chainlink $LINK. The partnerships are massive, the tech is cutting-edge, yet the price is flat. We investigate: Is this the “AWS of Finance” moment, or a value trap?
🏦 DeFi vs. The World: Forget the crypto casino. We uncover why the world’s largest institutions are racing to move trillions of dollars on-chain, from instant settlements to banking the unbanked.
⚡ The Great Bridge: Chainlink isn’t replacing Swift, it’s supercharging it. Discover why partnerships with MasterCard, BlackRock, and the DTCC are the ultimate signal that the “Internet of Contracts” is finally here.
🤖 The Oracle for AI: As autonomous agents rise, they need truth. We explore a futuristic thesis: Could Chainlink become the verification layer for the entire AI economy?
💰 The Investor’s Dilemma: Why do the smartest analysts love LINK while the market ignores it? We tackle the psychology of holding infrastructure plays and whether you should buy the dream or wait for the revenue.
📊 The 2026 Inflection Point: With new regulations (Genius Act, Clarity Act) and the Trump administration support, we map out Sergey Nazarov’s timeline. Is the “show me the money” era finally approaching?
🎯 Trillion Dollar Opportunity: We debate the ultimate bull case: is comparing Chainlink to a 1999 investment in Microsoft and Nvidia valid, or is Krzysztof overdosing on hopium?
You can find more from Daniel Shapiro at: x.com/_dshap
Segments:
00:00 Introduction and Guest Welcome
04:08 What is DeFi Really Worth?
10:46 Chainlink’s Year of Announcements
20:32 Swift Partnership and CRE Launch
32:19 Market Corruption and Blockchain Transparency
37:29 The Management Question: Trust Without Disclosure
45:26 Comparing Chainlink to Tech Giants
52:15 AI, Consensus Computing, and New Use Cases
01:03:57 Competition and the Layer One Debate
01:13:30 The Investor’s Playbook: When to Buy
01:20:15 Final Thoughts and Annual Check-In Tradition
WSW – E111
I was trying to make sense of all this in the context of like, why isn’t everybody. Going insane over the, I think of it as the majestic stature of what’s happening.
trading anything on leverage and then you could say prediction markets. So being able to bet on anything. Those are both speculation based use cases.
you’ve got a bit of control. ’cause if it is like your most. Asymmetric bet, like the Crystal io will be a hundred percent all in this alone. Nothing else. So at least you got some diversification. Well played.
Welcome to the Deep Investing Jungle with your hosts Luke the Badger Hallard, and Christophe the Monkey Pi Kowski. This week we are back for round two with Daniel Shapiro Daniel’s a research analyst at Block Works Research and he specializes in cryptocurrency market trends. Blockchain technology and defi decentralized finance.
Daniel, we were just checking a diary. It was literally a year to the day today when you last connected with Christophe and I so you could teach us all about Chainlink. And I subsequently bought some link tokens, and I know a ton of our Patreons are really interested in this space. So this week we’ve got you back yet again to demystify the potential and the challenges of Chainlink.
And tell us more about the evolving world of blockchain technology. Welcome to the pod.
Awesome. Thanks. Uh, thanks for having me, guys. Happy to, uh, happy to be back.
Sweet Daniel. So I’m the resident in our Wall Street Wildlife community. I’m the resident chain link nut. Uh, and often I think I’ve converted maybe a few of our, our members to the madness. Uh, but I’m still, it’s still mostly me with, with what feels like a whole bunch of insanity in my head, you know, trying to match what I think is happening versus, you know, what we’re seeing in reality and how it’s unfolding. So I wanna step back. I couldn’t wait to, to start this conversation with you because I don’t know what I don’t know. Um, let’s start on the high level. From my understanding, especially over the last couple months, say all kinds of legislatures in the work, uh, is in the works BlackRock and the US government, and everybody is starting to talk about global finance moving on chain, it seems like a big effing deal. But any normal person, I think when they hear the word defi. My legitimate guess is they have no idea what that means or why that’s important or why any bank, normal bank would want anything to do with this kind of thing. With Defi. Um, can you give us the sort of big picture of what is the value, uh, proposition of defi?
Absolutely. So I think, I think there’s kind of two angles here. Um, and I’ll start with the first one, which is, I’d say the kind of the more historical, um, value proposition of it, which is, um, the, the disintermediation of these kind of intermediaries that might, you know, these middlemen, rent seekers that extract value, um, from end users in the financial system.
Um, and by creating these open, uh, internet protocols effectively where users can. Interact with various financial primitives that are, that are traditionally only, um, accessible to, to those, um, with banking systems. Um, they can get access right to these, to these tools, to, to better manage their, their wealth, their capital, um, and ultimately their, their lives, right?
Um, and kind of the, the ability to do that was, um, the ability to, to secure these people’s values simply over the internet was enabled, uh, by virtue of these being decentralized, right? And these operating under consensus mechanisms. Um, where now, right, I can make an agreement with you over the internet, uh, you know, to exchange some value or, um, to, to lend, um, some of my capital to capture yield, um, and, and write my, I’m not just throwing my, my money into the ether and it’s, it’s getting lost to, to some scammer, right?
Um, and so really the. You know, only 2 billion people around, you know, ish in the world have access to, um, bank accounts and, and traditional financial, um, services. And, but there’s over, you know, I think around 8 billion people. So, um, and it’s a lot easier to get a cell phone right. And access to the internet than to live in some geography, um, where there is a government with a political system and a judicial system that can support the existence of, of companies, let alone, um, financial markets.
And I think around 4.5 billion people have access to, um, cell phones, right? So I think that, you know, is historically kind of the first angle of the value prop of Defi. Um, what we’re seeing in more, I guess, traditional westernized, um. Countries, right? Like the us um, where we have banking systems, um, the value prop changes, right?
Because we already, we don’t need permissionless access to, to a new, um, financial system, right? Like we already, we have that, right? So, um, I think the, the next big shift for Defi is, um, around tokenization, right? And the value proposition there is effectively we are upgrading, um, legacy infrastructure that is slow, um, expensive and kind of opaque.
Um, and what, what defi, um, offers, right? Not just to like the retail participant, um, market participant in the US but to these, um, massive institutions. Um, you know, wall Street per se is things like instant atomic settlement, t plus zero settlement. Um, you know, if there’s. If there’s, you know, hundreds of, uh, billions of dollars or low trillions, uh, single digit trillions of dollars of, of, um, US treasuries that are locked, um, for a day while they’re transferring, that’s a day where they could be earning 4% yield in, in the repo facility, right?
And that’s billions of dollars a year in just revenue right there from instant settlement, right? So that’s efficiency increase, right? Um, uh, another thing could be right, interoperability. Um, you could have previously, uh, entities that, that couldn’t transact or, um, you know, maybe they were different lines of businesses, business and, and even in, even in single banks, um, like, uh, BNY Mellon, right?
Like their, their bank is so large, and this is actually something that they’ve spoken about with chainlink, like different divisions within their bank and different, you know, um, services don’t actually have, uh, the ability to interact with each other directly. Right. So I think, um, interoperability, kind of the digitization there.
Um, you can kind of have companies have full parametric, um, overview and control of all of all their assets. Um, things can talk to each other instantly. I think that you, you’ll see a lot of capital efficiency improvements from there. Um, and then kind of the last big, I guess, value prop of tokenization is that you can take previously illiquid markets and you can now, um, actually create services or make those investible and sell them to an increased number, um, of, of users, right?
So something like art, um, fine art, um, you can make it easier to invest in, in real estate. Um, you know, we’re starting to see now people actually tokenizing data, ai data center cash flows. So I think that there’s a lot of new, interesting financial products that, that are gonna come out of, um, defined tokenization.
So I think those are kind of the two, the two pillars. Um, I think that, uh, that’s why it’s kind of a, you know, it’s kind of the hot, the hot thing right now.
Awesome. So cool. So let me just try to sort of summarize in brief, uh, part of what you said and then, uh, I have a follow up, uh, to, to run by you. So in one sense you said it’s basically instant when you do something with Defi. You don’t have to wait. Say several days or over the weekend because banks are closed, right?
Saves immense amount of money. Two, everybody with an internet or cell phone has access to it. Banks not needed, right? So kind of globalizes the financial world. Um, three, there’s no middleman. You’re not dealing with intermediaries, right? You’re, you’re, you’re doing it yourself, right? As long as you could handle the keys and stuff, right.
And not fuck it up. Pardon my, my language. Um, and the markets are always open, right? Like, so it’s sort of bringing this world like that, that yeah, if you need money, you’ll get money or whatever the deal is, right? So instant, this thing of in being instantaneous, my follow up to you is, I don’t know if this is, this is just getting too far ahead of ourselves, but in our investing world, I recently started following a company called GNS Genius Group. Which is a kind of tiny low market cap that’s like a Bitcoin treasury kind of play. It’s a weird company, but the reason I was interested in it, because it’s fighting market corruption. It’s been, uh, it alleges, and I think truth truthfully, it alleges that its value was destroyed by market manipulation in which the market makers basically created shares out of thin air in order to drive down the price because they were short a bunch of shares. I mean, I, I name it, I call it like outright corruption. The make, you know, making things out of thin air and then doing whatever you want behind.
Who knows what dark doors would bringing, say equities and grow in the stock market onto defi or blockchain, help fix problems like that. I.
You, yeah, absolutely. I, I, I, I think that, um, it, it definitely fixes the, uh, to, to some degree, right? Um, these systems are like, traditional systems are more opaque, like blockchain ledgers are transparent. Um, now a, a prerequisite that, that will need to exist for, for these to be adopted at scale is actually privacy ’cause, right?
No one wants to live stream their, their bank account and all their transactions, especially, right? If you’re a company that’s work, you know, working on the behalf of, of people that are trusting you with their, with their money and their privacy, um. They’re, they’re not gonna do that if, right, unless they have some, unless there’s a basic level of privacy.
But what a blockchain does enable is effectively, um, if, if something right illegal did happen, then um, blockchains can allow, um, I guess selective, um, investigation of, of transactions, right? So, um, you know, like one, kind of like the most popular example of this is a technology called Zero Knowledge Proofs.
And these allow you to verify some sort of information or some sort of transaction without actually revealing, um, the, the, the underlying contents of, of the data, right? And so with these types of systems, you can guarantee people’s individual privacy, right? And that like they’re, um, what, what they’re doing is not just getting broadcast to the world to, to see, but at the same time, if there is some type of fraud, um.
Then, then the government can come in and those, you know, the transactions that at play there, ’cause Right, everything is, is recorded, um, permanently right on the ledger. So it can’t be tampered with. It can’t be manipulated. Um, and so if something illegal happened right, like that, like some type of fraud, then yeah, a hundred percent that can be found.
Um, and right, those set of transactions can be, um, can be identified and then tied back to the individuals that,
And that was one of the original use cases, right, of blockchain that kind of, you can’t screw with it, but. The right. So, so I mean, that’s not, I don’t think that’s mind blowing to anyone. Um, but it is a kind of major fundamental use case, right? Like basic 1 0 1, like,
a hundred, a hundred percent. It’s, it’s, it’s kind of built into the, it’s built into the technology.
Awesome. Okay. So that’s kind of the big value proposition. And unless, uh, Luke, you know, I don’t know how this all sounds to you, but it makes sense, intuitive sense to me that every last financial institution in the world would want these qualities because it’s a major upgrade, both for, for all the reasons we discussed.
Do you, do you like you sort of being, uh, our resin Guinea pig, does that make sense to you or do you have some pushback against this value proposition? Why it’s so obvious?
I think it’s like another channel, another way to transact, another way to do stuff alongside what you have today. So it kind of resonates with me, but I’m a, I’m neither, I’m in the middle of it. I’m neither a crypto. I’m, I’m sort of, I’m a partially crypto skeptic and I’m partially like onboard. Um, I don’t think like traditional ways of transacting and things like Swift are gonna go away anytime in the next like 50 years.
But if they get augmented with other technologies, then yeah, I can see that.
Yeah, well that’s where chain link’s gonna come in, but I’m sure Daniel will will speak to that in a bit. Okay. So, uh, I guess the next question, Daniel, I, I want you to have a little bit of fun, uh, though, if you could keep it sort of, you know, translate the jargon for our listeners as best you can. It’s been a year since we last talked, and from my perspective, what Chainlink announced, especially over the last, uh, what three months. Has been to me like kind of, um, mind boggling. And would you mind telling us what you heard or what you saw happen both in Frankfurt, at Cybos and at Smart Con And which of the things that they talked about moved the needle for you personally in your understanding of Chainlink and what they’re now offering?
Absolutely. So it’s, um, you know, it’s a, it’s, it’s another year. Um, a lot of progress, um, you know, price relatively flat, but I’m sure, we’ll, we’ll, we’ll get into that later. But I think, um, something that Chainlink announced last year, and I I think we might have brought it up here, is, is, um, what they’re calling their chain link runtime environment.
Um, and effectively blockchains are, are just the ledger component of some type of, you know, of, of what we are talking about when we talk about defi, right? There are. There are other components, um, of defi that need to be decentralized, that are, that are kind of critical components to, um, to any, you know, defi based application protocol, you know, tokenization project, et cetera, right?
Um, these things need to be updated with real time price feeds. Um, a lot of the time they need external triggers to actually, um, tell them that something happened in the outside world, right? Blockchains are right by design, kind of these tamperproof closed systems and for them to interact with external systems, right?
They, um, they need to be told what happened, right? But kind of that, that oracle, right, that mechanism that tells them what happened or tells them about some data that needs to be decentralized as well, right? And so, um, whether it’s chain links, cross chain interoperability protocol, which allows smart contracts to talk to other systems.
Um, their data feeds, right? Feeds data into these things so that, um, lending markets can, can price assets or, um, perpetuate, you know, perpetual futures, exchanges can price assets, um, you know, whether it’s something like enabling, uh, privacy and, and confidentiality, right? Um, Chainlink, uh, actually announced, announced this, um, at, at Smart Con their, their confidential compute, um, mechanism, right?
So there’s all these tangential services that, um, are necessary to interact with financial markets and, and obviously, you know, all these systems currently run on the swift messaging system. Um, what they, you know, kinda what they announced at Cybos is the further continuation of, of their partnership and effectively, um, what I view as, as Swift’s, you know, attempt to, to modernize, right?
And instead of reinventing their whole base, you know, infrastructure and messaging system. They’re effectively just layering chain link on top so that Swift messages can now, you know, trigger any type of interaction on, on any, you know, chain link enabled, CCIP blockchain. Right? Which, you know, I think it’s 50 70 chains now, something like that.
Um, or, or other external systems, right? Like a, you know, whatever, like a JP Morgan, um, Connexus, you know, staple Coin Chain or a, or a
right? DTCC as, uh,
announced yesterday, or two days ago, right?
Yep. DTC, right? They announced that there are big tokenization things happening in the second half of 2026. And even going back to Chain Link’s conference, their, um, very first in-person Smart Con in 2021.
Um, Steven Prosperity, who is the head of tokenization at the DTCC, um, was one of the only tradify, um, people speaking there. So Chain Link. We know Chain link’s been working with the DTCC for four years now, at least. Um, and it seems like, you know, they are launching something next year, um, which, you know, it could be, um, you know, the Genius Act now passed.
Now we’re kind of waiting on the Clarity Act, and I don’t know if you wanna talk about this now or later, but, um, you know, it seems like the regulation is now passing that would enable a lot of this to move forward. So it has been, you know, a lot of talk, a lot of building, a lot of announcements, and I guess not much, not much else following that up, but it would seem that if we are, you know, if, if this thesis is correct, and we’re looking back on this in five years and 10 years, it, it seems like we’re we’re at or very close to, to the point, um, I guess to, to the tipping point, right?
Which is exciting as an investor because your, your thesis is either going to be validated or invalidated and, um, you know, both, both are useful, right? Um. But yeah, I’d say the biggest things is, yeah, continued swift, um, partnership, um, kind of announcements and, and, and more, uh, color over that. And then the launch of CRE, which is really, um, I think it, it it’s effectively chain link creating a single cloud platform, um, for people to interact with all these services in a very easy composable and, and repeatable way.
So it’s, you know, it’s not that it’s in itself a new offering. Um, you know, it’s not, yeah, in itself, it’s not like a new, a new type of service they’re providing, but they’re effectively enabling developers to interact with all their services in a very easy, streamlined way. You know, something like an AWS makes it easy for developers to, you know, to build web applications in from a single environment, right?
So I think that’s you, you know, GCP, Google Cloud, um, services, right? So. I think that’s kind of what is, is coming together and it seems to be coming together. Right, right. When regulation is, is pushing through. So was that planned? Was that, was that timing,
Yeah. Right. So I’m glad you mentioned, I’m glad you mentioned Daniel AWS because to segue to, to the next bit here I was, I was tinkering, you know, I was, I was trying to make sense of all this in the context of like, why isn’t everybody. Going insane over the, the, i I think of it as the majestic stature of what’s happening. You know, like the paradigm shift is to me, having followed this for so many years, like right in front, you know, right in front my eyes. Um, so it feels like a huge deal. Why? You know, like I was trying to make sense of it basically. And on my own, I kind of thought back to myself as an investor back in, I don’t know, approximately 97, 98, 99, watching the Amazon story unfold. And I remember for many, many, many years, all the analysts. You know, all the critics were saying, this company is dead, can’t make a profit. It’s it’s, you know, blah, blah blah. But that, that kind of critique lasted for a long time. It was not a one and done like, oh, they’re genius, right? It’s gonna, so there’s that bit, right?
And I’m like, oh yeah, this sounds a little bit familiar, right? Where with the chain link story, with where we are, like pe it’s right in front of you, but nobody seems to be, well other than the wholly converted. But then, um, to your point, Amazon’s sort of magic switch was something that most people don’t even know about. AWS like building the thing that helped run the internet. Not the books, not the right, not the distribution. That kind of came later. But the AWS sort of behind the scenes thing was their magic formula to immense cash flows and. You know, able to then cycle it back into the business and so forth. So I was thinking like, holy cow is chain link.
The next a uh, Amazon and then the slide deck comes out, you know, chain link’s own slide deck where they did one better. They have a slide that shows chain link, the foundation of on chain finance with stack in on top. You see Microsoft Windows and how that ref revolutionized or brought about personal computing, AWS, how that led to cloud computing, Nvidia leading to artificial intelligence and the last brick chain link bringing about on chain finance. I saw this and it clicked for me as though I’m back in, you know, 97 about to invest in Amazon. I believe Luke is much more spec skeptical when I said, holy cow. Like this is not a small thing. Right? If, if chain, you know, like chain link is at least per this slide hanging out with the big boys, do you think, Daniel, that this kind of comparison has any amount of legitimacy that could be sort of that big as a Microsoft, as an Amazon, as an Nvidia?
I mean, I don’t know. I don’t know if as big as a, as an Nvidia, right. But, um, I, I, I do think it’s an, it’s an apt comparison, right? And I, I think, you know, I, in terms of why people, um, you could say aci, it’s ’cause, you know, price action leads, leads, narrative, price, action leads everything right. And prices has been flat for.
Um, you know, effectively two years now. So, um, I think that is, you know, chain link’s been talking about Swift since 2017, right? And so, um, I think people in crypto are, I guess, you know, they want to see revenues buybacks, um, you know, token buybacks, you know, feed generation, right? They wanna see that all directly.
So I think that, just as a quick aside, I think that is, is the reason why, um, I guess people might not, you know, why, why all the announcements might not have like, triggered that much reaction. Um, in terms of whether I think that, that this is legit. Um, I, I, I don’t feel more confident than I do today. Right?
Which is weird to say, because price has effectively diverged, you know. More negatively to, to this extent over this time horizon. But it, it, it’s just funny because, and I don’t, I don’t wanna get too technical, but like a lot of the stuff that I’ve, I’ve written about over the past, you know, three years is starting to come true with respect to, um, a lot of the fundamental infrastructure in the space that people thought was very valuable.
Like in Ethereum or Solana. Right now, the narrative is shifting that these things are completely overvalued, don’t generate enough cash flows, have p you know, ps uh, price sales ratios in the thousands, um, are losing market share. Um. And kind of the future is moving and, and we’re seeing in real time, right?
Like the most successful applications in the crypto space, like a hyper liquid, are literally applications that just built their own infrastructure, right? And so, everything that I thought from a fundamental perspective of why chainlink is valuable and that they’re effectively creating modular, um, generalized blockchains for various types of, um, various types of compute and, and data that are fundamental inputs, like what they’re building, I, I think is, it couldn’t be more aligned with, with the, the, the narrative around infrastructure is heading, right?
And this, you know, this, once again, I don’t wanna get too deep, but as a, as a crypto research analyst, like, I think that, you know, I don’t wanna just sit here and say like, oh yeah, chain links the next Google, it’s the next a d this, right? Like. It. They’re, you know, literally the smartest people in crypto right now are, are having like the, the biggest narrative discussion right now is around layer one blockchains these generalized layer one blockchains and how they’re really overvalued and how there’s not that much innovation occurring on them anymore.
Meanwhile, you have chain link, which is building this completely differentiated product, um, of effectively, uh, elastic, modular, um, I mean, what they call dawns, right? Decentralized Oracle networks. But if you think about it, these are just mini blockchains that generate consensus on anything. So like a dawn could run a blockchain, right?
You could run a consensus protocol inside of a chainlink dawn. Um, right? Kind of like a, a square is a rectangle, but a rectangle is not a square. Right? Um, Chainlink has built the most fundamental, um, I think their understanding of, of where everything is going, right? Not, not only do they have the strongest partnerships with.
F with Swift, um, with all of Tradify. Um, but, but what they are building for them to build is they’re giving them the tools for them to create effectively application specific to, to create applications. And then the underlying infrastructure is completely abstracted for them. Right. And so, you know, if you go just look up hyper liquid, the, the coin is called hype.
They built a futures exchange and then, um, they, they built it on their own, on their own chain with six validators. They didn’t build it on Ethereum, they didn’t build it on Solana. No one really cares about decentralization. They care about sufficient decentralization. And as hyper liquid is scaled, they’ve increased the number of validators.
So I think what Chainlink is building is they’re effectively, I don’t think they’re right. I think they’re gonna completely replace, not completely replace right. But they’re effectively giving the tools to. All these financial in institutions that have the distribution, that have the trillions to, you know, quadrillions of, of dollars, right?
They’re giving these people the, the tools, people that have the assets, that have the distributions, that have the ability to generate cash flows to, that have moats, that can, that can sell products with high margins. They’re giving them the ability to effectively tokenize, right? To, to create decentralized forms of their applications, get all these efficiency improvements and effectively spin it up in a couple months using chain link infrastructure.
It’s not gonna be built on Solana, it’s not gonna be built on Ethereum. They’re not gonna create their own chain. It’s gonna be these effectively hyper-specific, you know, applica and the, and the AWS equivalent would be if I want to go make an app, right? Okay, I’m not gonna go build my own database. I’m gonna use S3 or Dynamo db, right?
If I need some com, if I need compute instances, I’m gonna go launch various EC2 instances, um, for compute. Um. You know, they have hosted databases as well, right? Uh, off services. Um, API services, like, you know, they abstract all that away so that the developer could easily just go build the thing that they want to build.
Right. And Daniel. Right. So the point, right, the point of what you’re saying, if I could kind of condense it, is. F Luke, if like, to bring you back into this conversation to me, those kinds of, um, that value, you know, where that allows everybody else to do what they need to do is measured in the billions and billions of dollars, like massive. And I think what I’m curious about your take about this is, you know, from the investor standpoint, if we look at something like Microsoft Chart, you know, the, just the stock chart, like, I don’t know exactly, but the line was flat for like many, many, many years as the software, you know, proliferated in, in the personal computer industry started to grow and grow.
And then there’s this inflection point that’s just, you know, rocket straight up now at a trillion dollars. Ask any, you know, investor, I guess to go back to that time machine at, during that origin story. And they probably would sit here and not say like, this is gonna be worth a trillion dollars, Amazon, Microsoft, or Nvidia.
Right. And the Nvidia inflection point only happened a couple years ago. So my question to you, Luke, is if what Daniel is saying and what I’m sort of preaching about is call it technologically true, and now we’re seeing real world adoption by the biggest financial institutions of these tools, is it preposterous to think that yeah, we’re just early and yeah, the price is, you know, dog shit. But that’s been true for these other three examples. Why would this be different?
so look, we’ve got our expert guest on the show, Christophe giving us a really sensible, grounded answer and you keep trying to take us into this like hyper hyperbole, like fantasy land. Um, again. Okay, look, let’s take a really optimistic view.
That chain link comes in and is able to like entirely disintermediate swift and maybe do a whole bunch of other stuff too. Um. And can you equate that with like a Microsoft and I, I get the purpose of your question ’cause it’s like we didn’t know back before AWS existed and when Amazon was like a bookseller, none of us had really any idea about the potential of these things and how they really redefined markets.
Is Chainlink one of those things? I don’t know. Like I, I see that it’s an, maybe it’ll become something totally different in the future, but if we take it for what it is, which is like poten, if you, if you buy the argument, like a better way of doing things that we do today and enabler efficiency, faster, cheaper, um, okay, so let’s say, okay, let’s say it disintermediates Swift, right?
So you, you can’t really put a value on Swift, but it’s like a collective and I think the banks kick in about a billion dollars a year to contribute to the funding of Swift. So maybe, you know, some or all of that goes to. Like chain link instead. So you’ve got like a billion dollar in kind of notional revenue.
Um, and then maybe, I don’t know, maybe it disintermediates like a lot of the stuff that WISE is doing, like around money transfer. I always get that question as like a, a wise guy. So you’ve got like maybe another, um, like $10 billion in market cap there. I, is it like a trillion dollar, a $5 trillion company?
I, I don’t know. It would have to be something materially different for that to be the case.
What do you think, Daniel? Um, Luke’s basically telling us the scale is way off. Maybe the analogy is right, but the scale is way off. And, uh, just, just real quick, I don’t think. From the investments standpoint, Chainlink wouldn’t need to get to a trillion. Just getting to say 250 billion would be plenty for, for our returns.
But Daniel, what do you think about, um, basically the critique that Chainlink is just nowhere near as the vision is not big enough to justify comparing it with Microsoft, Amazon, or Nvidia.
I mean, I, I think it’s, it’s, it’s, it’s tough to, it, it’s tough to make those comparisons, right? Like it’s, um, you know, I don’t, I don’t know. Um, I mean, like, who, who knew that Nvidia making, like computer, like gaming chips was gonna be the foundation for ai, right? Like, I, I think it’s, it’s, it’s impossible to know.
And, and to be quite frank, too, like, I don’t think as, as an investor, it’s important to even think about how big it could be, right? Like, I think ultimately it’s about, yeah, I mean, I’m sure that there were people sitting there going. Oh, Microsoft, this is so valuable. Like even when it was going sideways for eight years or AWS for eight years, right?
And they, they predicted that what they were building was gonna be useful and it was gonna explode. Right? But like, they were wrong for eight years. And so, like, you know, to be, to be frank, like I’ve been wrong about Chain Link for however long now, you know, since, since the bear market, since the top in 2021.
And maybe I am Right, right. But I think, um, I think the important thing is if, if right, like these catalysts do start occurring, then price action will pick up. And, you know, like you ride that as, as, as high as you know, like your targets are and based on your own personal, you know, portfolio and, and goals and life goals and risk tolerance.
Like you take profits where you, you think you can take profits, right? Like debating whether it’s gonna be a hundred billion dollar company or $1 trillion, I mean. To give some comps, right? Like Ethereum made it up to 580 billion market cap, you know, a couple months ago, um, at like a 3000 price sales ratio.
So who, who’s to say that chain link off of just narrative and hype couldn’t go up to like a trillion dollars and then correct down to like a hundred or 200 billion?
Well, Daniel, well, well, Daniel, let me, let me rephrase then. The, the, the question, forget the valuation stuff. I think that’s actually taken us off the wrong path to, um, let me put it this way, uh, by way of analogy, inventing the personal computer for Microsoft and then having computers basically run modern society, I could see that as a huge, big deal. And why that would be worth a lot,
uh, Amazon, what they were able to build deceptively. I could see why that’s a huge deal. Basically, the, you know, e-commerce inventing the whole e-commerce thing. Nvidia, obviously, we know why that’s a big deal. When I look at the tools that Chainlink is starting to offer, what I think of as the entire global financial world, my question is, is that if executed properly, a big f-ing deal, or is it just not gonna be big enough?
No, I I think it’s big ’cause it’s, it’s more than, it’s more than just finance too, right? Because what they’re building is, um, generalized consensus computers. And so, um, you know, like an example that they’re, they’re, um, effectively head of technology re Jules talked about at Smart Con is, um, what he’s calling protected prof.
So. Um, effectively data pipelines for ai. So the biggest problem right now in AI is, um, effectively models are, are made through processes of, uh, composed of pre-training and, and, and post-training. Whether it’s fine tuning or, um, reinforcement learning during the pre-training stage, you effectively throw as much data at the model as you, as you physically can.
The thing is, is, um, public web data is effectively exhausted, right? So it’s, you know, however many, um, 6 trillion, 60 trillion, um, you know, tokens worth of data. Um, you know, these companies have scraped every bit of data off the internet that exists. Um, private companies though, right in, in, you could say the deep web or in, in, in private parts of the internet, whether it sits in companies or or with individuals, it’s estimated, um, to have two orders of magnitude.
So, you know, a hundred times or more data than exists on the public web. That data would be hyper valuable for AI companies, for, um, for training, um, AI models. Um, the problem is that that data is private, right? And so there’s various technologies where you could, you know, train, um, train on, on, on encrypted data once, uh, FHE fully homomorphic encryption and others MCP multi, uh, multi or MPC multi-party compute.
Um, another is using something called trusted execution environments, which, um, that’s kind of um, re and where chain like Chain Link choir. Town Choir. Town choir, which is a, um, SG SGX intel based, uh, trust execution environment. Um, Oracle back in like 2018, right? And so kind of that whole development, it turned into something called deco and now they’re calling it confidential Compute.
What you can do with Confidential Compute, which is a combination of trusted execution environments and zero knowledge proofs. Um, is you could do something like encrypted AI training pipelines. And so to me, the value proposition of consensus computing extends beyond the financial system. Now, like, I don’t know what the margins are gonna be.
I don’t know what the take rates are gonna be. I don’t know what type of moat they’re gonna have, like, but Yeah. Could, could building ge effectively the, the platform for, for generalized consensus computing, is that gonna be highly valuable in the age of AI where you have agents that need to know something for sure about the outside world for them to, to submit an action?
Well, how do they know something happened? For sure. Well, you have an Oracle network that’s using some form of consensus to determine if something happened, and so, right. Obviously finance is the first use case here, but I think that as we move towards a, a world with, you know, cyber physical systems, robots interacting with our daily lives.
How does AWS robot, you know, if they’re dropping a packet or if an AWS drone is dropping off a package just to a, to a robot at someone’s, you know, house, or how do they know that that happened? Who’s, whose sensor is AWS’s sensor that tells ’em that, that the package got delivered? Is it your personal sensor that’s run by Google that says that the package got delivered?
Like who gets to These are all ais. They don’t have, they don’t have the same biological systems we do that. Like, they live in an abstraction of our physical world where they only receive information, um, digitally. And so I think Right, like could Chain Link eventually get into, um, or could Oracle Networks be used for, for stuff like that as well?
Like, yeah. And if that’s true, then could the market cap be 5 trillion or 10 trillion, like sure, I could, it hit 500 billion or 1 trillion just off of the finance stuff. Yes. And that’s still like a 50 x or a hundred x from, from where it is today. So like, I mean, you know, I, I think what they’re building is very important.
Um, I don’t know for sure as, as, as no one does, but, um, you know, they are the largest company in crypto now. Um, I think they have the best talent by far. Um, and so, you know, if, if, if one company in Crypto’s gonna do it, then like, I’d probably put my money on them.
I suppose reflecting on like Christophe’s analogy and your comments about them being the giant, like if they are setting the standard for establishing consensus and stuff like that, like if they’re Microsoft, uh, with Windows, like is there an apple out there? Who is the main competitor?
I mean, I’d say, I’d say there, there isn’t a, there isn’t a single competitor, but their main competitor would be effectively. You know, the group of, um, layer one blockchains applications, um, companies that are launching chains, right? It would be, it would be, um, to me, a future where, um, you know, I think chain Link, for them to win, they need all of Tradify, right?
They need to all start building on the chain link runtime environment and, and the, and the flow, right? Like the amount of transaction volume, activity, et cetera, that, that takes place there is just significantly greater than the amount of activity that happens in, in crypto land, right? Which we’re like 1.5 trillion less now after this correction.
And you know, in tradify it’s over, it’s hundreds of trillion, it’s over 680 trillion worth of assets, right? So. Um, you know, it’s okay. Chain Link plus Swift. You know, I don’t like Chain Link. I don’t think it’s gonna disintermediate Swift. It’s gonna, it’s, its goal is to actually like, I guess, um, I guess build on top of Swift, right?
The, the competition is, you know, um, you know, hyper liquid as an exchange just, just keeps growing and everyone just moves off of these, these external systems to these new systems, um, directly, right? Um, you know, Stripe is launching a blockchain. They take payments, you know, directly, um, right? Like, uh, maybe like a Solana, um, you know, they had a ton of big amounts.
Maybe people start, you know, just building on them and, and the, the single generalized, um, kind of chain thesis actually is, is correct, and they start taking increasing amounts of market share, right? But I think where that argument falls apart slightly is that. Um, you know, there’s only so much capital and assets in the world, and those assets exist within the companies that Chainlink is now working with.
Right? So, like, I don’t think BlackRock who, who manages more tw more money, uh, more capital than the entire crypto market cap, you know, 10 times over. I don’t think they’re just gonna go deposit their 10 trillion plus into Solana or Ethereum and make the Solana and Ethereum validator sets rich. Right? To me, I think they’re, that they understand that the moat is in the capital itself.
It’s in the liquidity itself. And so the moat or, and the, the move is for them to either build their own chain, build their own infrastructure, build, build their own apps, build do their own tokenization things, right? Because they control the assets. And that’s what the moat is here. All this other infrastructure, the, the cost to make it, it’s all effectively, it’s not approaching zero, but it’s, it’s approaching some, some lower asymptotically bound.
Um, so to me that’s the competition though, is that, you know, uh, my generation, the younger generations, right, they just start moving onto the, the purely decentralized infrastructure directly. Um, and over time, as you know, the wealth is transferred from the boomers to the next generation. You just see that the capital and the old system slowly compress and Right.
But I think that that’s too slow compared to, you know, like if I had a place, a bet, I think that those people with all that capital, right, they’re just gonna, they’re, they’re just gonna build their own right defi, they’re just gonna build their own infrastructure on chain link first before that kind of shift, that full tectonic shift
Right. And that’s the important point, just to make this clear to everyone. Uh, if the banks, the BlackRocks say, no, we’re keeping all the stuff for ourselves. ’cause that makes the most sense. Their only option really is chain link, which is sort of the agnostic. Platform, which helps them do whatever they want to do with their own stuff, as opposed to what Daniel was saying, bringing it to a commercial enterprise somewhere else.
That’s why Chainlink sort of protocol like nature, this sort of, I don’t know, water, like internet protocol that is open to everybody without kind of saying, saying we’re, you know, you know, I, I think that analogy works, right, that they’re saying, do it your way. We’re just gonna help you and we’re gonna take a little bit of off the top for, you know, using our tools, using our protocol. Um, Daniel, uh, I have a little bit of a pet theory. This is kind of now far out, a little further out in the, in the loony bin that I wanna run by you. And it’s this sort of notion that, and forgive me if I, I don’t mean to be insulting to anybody, but, uh. I always approached crypto as mostly a circus like that.
For whatever reason, the technology itself lent itself to a bunch of bad actors that kind of had a casino like structure and you know, with all the frauds and scams over the years and, uh, bad, bad publicity to say the least, right. Crypto now means mostly that kind of thing. In that chain link is now over here basically playing nice with non crypto people that happen to control hundreds of trillions of dollars and that they’re sort of slowly saying, we’re not exactly crypto, like, the technology we’re using is crypto, but really we’re kind of more like. Um, we’re doing something else. We’re, we’re like developers or coders and, and we’re playing nice with the banks and we’re just going to kind of bridge these two worlds together, but don’t call us crypto. And my pet theory is that the crypto world sort of is seeing the writing on the wall maybe by what Chainlink is doing. And we’re in this weird transition period that people don’t know, like what crypto is anymore, why it’s valuable, and that eventually the real fundamental use case that is chainlink will basically be or turn into like the real uses that crypto, original crypto is for. I don’t know if that question makes any sense or where you could
Yeah, for sure. I mean, and you know, I don’t, I don’t know if it needs to be some, some conspiracy or, or anything at all. Like, I, I mean, and this is, you know, literally like the, the narrative that’s been happening the past month has been this, and I’ll frame it differently, but what it, what the, the narrative is turning into, right?
Like we’re, we’re beyond the, the early innings, kind of the hype stage of crypto, right? Like. It’s not, it’s not 20, it’s not 2017 or 2018 where, um, you know, we’re talking as if we’re cyp, you know, we’re Cipher punks and we’re gonna decentralize everything and we’re gonna replace the US dollar with Bitcoin and you know, we’re gonna solve global wars.
And because, you know, the government can’t just print money and Ethereum’s the global, you know, it’s this global computer and we’re gonna, you know, bank everyone. It’s like right, like no longer, like effectively what this cycle was. Um, so, you know, last cycle was, was that, I guess the cycle of everyone realizing like, oh, oh, like this stuff is real.
Like Defi came into, into existence in 2020 and things got very overvalued, right? Because of the height, because of the COVID money printing. And then things came down this last cycle, you know, I think everyone kind of understood, um, the game and this cycle was really about like meme coins. Like that was essentially. The cycle. Um, I mean, there’s been a few cool, you know, cool applications that are all based around speculation. So like, I’d say like hyper liquid around, you know, trading anything on leverage and then you could say prediction markets. So being able to bet on anything. Those are both speculation based use cases.
Right. Um, there’s been, you know, a couple cool apps like I’d say like an Athena around like a tokenized delta neutral basis trade. I think that that’s super cool. Right. But like, there really hasn’t been that much innovation this cycle and what I think the, the grifters the extractors, right. Um, you know, I’ve seen the meme with like the rollercoaster, right?
Where each loop gets lower and lower and lower. Like with pump fun like the. People like the ma like this, this cycle is just a lot of extraction and people just, they’re just tired of it. They, they don’t have any money. Le money left. Everyone knows that all this, all these things are scams. Everything that launched this cycle, all the price discovery occurred in the private market.
So like the whole high FDV low float meme where, you know, something 10,000 xs for the, for the VC in the, in the seed round, the series A round, and then they launch it $8 billion FDV and the, and the price immediately collapses 90%, right? So it’s like the game, like the easy money game of people just selling narratives is, is over.
So now it’s, show me the cash flows. What is your price to sales ratio? Um, because right, like the market has, has, has wise it up, right? Like my generation, um, this, you know, coming outta college, the, the whole stock. I mean, I was never into stocks. I was always a crypto guy, but the whole GME stuff. The, um, you know, I don’t know what, what’s like the Reddit group called, where like everyone trades in there, um,
Wallstreet bets.
wall Street bets, right?
Like Robinhood, like this whole group of investors, at least from the crypto side, like, like they’ve wisened up, right? And so we’re at this point now where it’s like, okay, the easy money of just launching, you know, the, the 87th layer one or the 42nd layer two, like launching this infrastructure that no one’s gonna use and just saying it’s faster.
Like that’s, that’s over. Um, and, and, um, I think that, right? Like the market’s realizing that. So I think Chain Link is positioned now for, let’s say the Clarity Act does go through and obviously like, you know, they, they did their little chain link reserve thing like. You know, they’re accumulating like a million dollars a, a month or whatever.
Like, it’s, it’s nothing. It’s just a, it, it’s just a goodwill. It’s just, I don’t, I mean, I don’t know if it’s just marketing, whatever, just look like we make some money. Like, right. But I mean, ultimately, um, chain link’s position now where if some of this stuff happens, right, and they actually start posting their, their, their revenue, their, their cashflow, um, on chain publicly, then they have the ability to rerate, right?
Like, I like chaining something that, that could, you know, it could 10 x in, in quick order. Um, if they go from what is effectively zero to, um, you know, uh, proving, proving out their, their business model, right? And so, yeah, I don’t, I don’t, I don’t know if it’s them trying to separate for crypto, like what I will say, like they’ve done, they’ve been doing a ton recently, like.
They’re now the official Coinbase Bridge. They, they’re now, um, operating on Solana. They have the official Solana, Coinbase bridge. Like they’re becoming the official bridging layer and, and kind of infrastructure layer of all these chains. Um, a lot of them that, that ignore them at first. So they’re still working on kind of becoming the standard within crypto.
But I do think we’re at a point now, um, I think we’re at a point now in, in, in kind of this market cycle where it’s like, yeah, I mean, why is Bitcoin diverging from gold? I mean, I think it’s for, for me, it’s very clear. I mean, I, I don’t think it’s well understood. I think there’s a lot theories around it, but people realized, oh, like if I can, if I take the energy, I am, I, of all my power contracts, if I take this energy and divert it to an AI data center instead of mining Bitcoin, I will make more money.
So I am selling my Bitcoin to go do that. It, it’s, it’s pretty simple to me. Right. And so, um. I don’t, I don’t If Bitcoin starts underperforming more moving forward because of that dynamic, like it’s gonna drag the entire market down with it. And the only thing that’s gonna outperform are things that are idiosyncratic and have their own cash flows.
Um, and what’s interesting about chainlink, right, is it’s not just speculation based, right? It’s not I’m building a meme coin exchange, or I’m, I’m building a, a futures exchange to leverage trade or, you know, it’s there. It’s, it’s a fundamental efficiency improvement to the global financial system. Like this is like something real that, that’s gonna produce massive efficiency gains.
So like it’s differentiated in, in that sense. Um, so I, the shift is happening, um, there, I think there’s a lot of different, different reasons for it, but, you know, I, I think Chainlink is, is well positioned to capitalize here. But once again, if it’s all real, if the partnership, if, if all these partnerships start actually manifesting in cash flow.
Um, and maybe that like, that could lead us into the, the last phase of the, um, maybe conversation or something. But, um, yeah, I think it’s simple. Like I think you just wait and I think it’ll be obvious when it happens. So, you know, you don’t need to take a position today, um, and, you know, join, join the, the crazy group of myself and everyone that’s been saying this for years and nothing’s happened, right?
Maybe the smarter move is just to wait for this all to happen and then buy. But, um, I, I do think that if it’s gonna happen, I think the next, I mean year two, two years, three years is, is the timeline that I guess Sergei’s been talking about. So.
Yeah, Daniel, um, you, you, you led us nicely to this last bit. Um, of, the hardest part of, about being a investor in Chainlink for me has to do with, in, in normal stock terms, you know, trusting the management is like one of the core principles. Um, but in the stock world, you also have, you know, um, you have to file publicly, you have to disclose sales every, you know, I mean there’s all this reg regulation and so you get to learn. The easy or hard way, whether management is trustworthy. We have documents to your point about the Chainlink reserve. Um, my, my take on that is it’s actually, you know, they’re buying about a million $100,000 of chainlink per week, so call it 4 million something per month, which in the big picture is, is nothing.
Is it, is it per week or is it I think it’s, I think it’s a million per month.
Uh, it’s per week.
It is. Oh, that, that’s actually, that’s not bad.
Yeah. So they’re up to, I mean, you know, since it started, they’ve now bought back over a million, 1.1 million chain link out of a market cap of a, so one, 1000th, 1000th of chainlink is now in reserve. To me, the number is obviously tiny and relatively material, but it’s a signal. The only one I have so far that the actors involved in this project, because they’re working with the world’s. Top financial institutions, they cannot afford to be any kind of con artist or mean flipper or you know, clown show at all. And this is the only signal that they could in a sense give right now that we’re on the shareholder side and we’re legit, you know, and this ain’t no rug pull, pull thing
Yep. And, and just, and sorry to cut you off, but also what they’re doing with their staking program, with their cubes, where you can allocate cubes towards these other projects that are part of the scale program. It’s like a points program because they can’t do anything token related. Right. ’cause they’re following the, like they’re following the rule book by a T, right?
Which is, they’re probably being too conservative, but they’re making sure that they’re following everything. You know, 100%
exactly. For very, right. So the, the flip to that, Daniel, is, I mean, I guess I as an investor, lean naturally towards risk on. And in this moment chain link. I don’t know. The only, the main queasy feeling I have is lit. Literally acknowledging I have zero idea how much revenue they’re actually bringing in. And that leads me to two questions. Why? Right. And the only quasi optimistic view or answer to that is because of the scope of what they’re trying to do. That network building phase, they do not want, like for strategic purposes, the way any utility and battery company don’t reveal clients and backdoor talks.
Right? It’s to your advantage basically to chain link’s advantage to, to in interconnect, to insert themselves into every last piece they can, at which point it’s too late to, for anybody to dominate and revealing revenue flows and all that stuff with. Decrease their leverage, uh, negotiation position. But I have to trust that which is upsetting as an investor.
Does that, is, does that jive with your understanding of like where we are right now?
Yeah, no, I mean, you’re, you’re a hundred percent correct. Like from a game theoretic perspective, like the longer you can remain in stealth mode, the larger a benefit is to you. Right? And so you could say in traditional markets, um, capital formation, like other companies would do this as well if they could, right?
Um, but they can’t because they legally can’t do that. But for whatever reason, right? They not for whatever reason, but because they are a crypto protocol, like yeah, they can do this. And so, you know, they’re kind of still in stealth mode to some, to some degree, right? And when the floodgates open, um. There, there won’t be, there won’t be a single competitor.
So I mean, it’s, yeah, it’s, it’s, it’s frustrating, right? Because I mean, it depends, as an investor, you could say, oh, more time to accumulate. Um, but you could say also, oh, I wanted price to go up more already. Okay, that’s fair too. Um, but yeah, I think from the team’s perspective, um, if they can effectively, you know, keep things, um, private, like they have, it, it, from a game theory perspective, it gives them an advantage.
And so, um,
Yeah,
yeah, it’s just, it just, it just, it is what it is, right? Which, but, but, so I think, I think the move then is as, as a, as a potential investor, it’s, you know, look, you, you gotta size your position properly. Um, and then the second thing is, is, yeah, I mean, if, if once all this stuff. Once all this stuff, like if it is gonna happen, it does start happening.
Like you’re gonna have time to buy in, right? And so I think that, um, given those dynamics, right, I think the move is like, you know, for this thing to start out performing or, or for this thing to reach those goals, it’s gonna need to start outperforming first, right? And so measuring how it’s performing against the Ethereums, the solanas against Bitcoin, and you know, when it does start out performing, then you can start to, to size in, um, more aggressively.
But yeah, no, a hundred percent like it. Um, and like I’ve, I’ve done, I’ve done the research, right? Like I’ve looked into, um, really the big thing is their scale program. So this is off chain agreements that they’re making with, um, the largest layer one protocols and. Um, you know, this was work I did maybe a year and a half ago at this point, but I thought, you know, I, I found they were making in the hundreds of millions of dollars, right?
Like just a single deal with like, you know, ’cause there, there’s all these layer one blockchains that are, you know, raised literally billion, you know, billion, $2 billion, and are just ghost chains. They, they don’t, they literally don’t, like, there’s no one builds there. They have no idea what to do, so they just spend their money on marketing and stuff, right?
Like these types of chains, obviously they need chain link services. Like, I think that, you know, some of these might have paid chain link anywhere from like 25 to like $75 million. Right? And if you stack up, you know, five, 10 of those, that’s, yeah. Hundreds of millions of dollars in revenue. And that’s not counting.
There are other services and I don’t know, you know, and, and that’s not counting anything with like Tradify entities potentially.
like, we didn’t talk about this, but like, and I don’t know too much about the technical use case. Maybe you could tell us. That, that could take us off, but like Chainlink and MasterCard are working together. So, uh, trying to quantify how much money is Chainlink getting for a partner like MasterCard whose market cap is, what, $600 billion is not gonna be tiny.
Right? And,
Perfect.
and maybe a segue to that, Daniel, is, uh, to go back to this management thing, I’ve now listened to maybe a hundred interviews with Sergey Nazarov, the co-founder and kind of the face of Chainlink. The one thing I get from a sort of, you know, valuation of management perspective is that guy to me seems like no nonsense. Like he’s not, he, he, obviously it’s technically proficient and knows what everything there is to know about the, the, the two different worlds and how to bridge them. But I like my CEO to be in a sense, ruthless and he has that kind of quality to him. Um, like determined, ruthless. He’s not here to play games.
None of the, you know, clown show casino games. That gives me confidence that when they’re at the table and Chainlink is at the table with MasterCard and JP Morgan and DTCC and every last major thing, that they’re not talking about pennies here. Do you think that’s, uh, do you have a different read
of that?
Am I over.
same, same read. I mean, I’ve, I’ve met the guy, I’ve talked to the guy. Um, I, you know, I like, yeah, I a hundred percent get that read. And then also, like you hear, you know, you hear rumblings through just crypto Twitter, right? This isn’t like sources or anything, but everyone always says like, oh, like chain link charges a lot for their services.
Like Chain Link is extractive. You should use this, you should use this other oracle, right? Like they know that they have the winning product, they know that they have the most secure product. They, you know, the best product and they, they, they charge for it. So, but once again, that’s all off chain. So, you know, I think, um, yeah, it’s, it’s, it’s like all the, all the necessary preconditions are there.
It’s just the only thing that, that doesn’t exist is the price action, which is the most important. And, you know, you’re the, maybe not as an investor, but you’re, if you’re watching this podcast, it’s probably ’cause you like trade. Like the most important thing is a traders to not fight, fight the price action.
And so you’re kind of fighting the price action. Um, you know, if you’ve been buying this thing instead of just Bitcoin, the past, you know, three years you’ve been fighting the price action. So it’s, you know, it’s, um, kind of is what it is. But I think that, right. Like I think the move here is, I, I think it’s very clear.
And if you know through your own personal independent research. Um, you know, you spend a weekend, I think you could come to the same conclusion. Um, I think the way to approach it though is I, I think that it’ll, it’ll be obvious if, if all this, you know, but the pro, if the breakout, like, if this thing does start breaking out, I don’t think it’s the type of thing you, oh, you short the highs, right?
I think you just buy, buy the breakout and then maybe for the next eight years it pulls a Microsoft and you just ride it, right? Like, whether you buy it at, at 10 or 20, or 25 or 50. If, if this thing is going to a hundred or 200 or 500, like you’re gonna, you’re gonna make a lot on it anyways, right? So like, I think, um, I think it’s clear the necessary preconditions are there, um, for the, you know, a type of generational, um, company.
Um, it’s just a matter of, you know, um, yeah, it is a matter of how you want to, you know, get in and maybe you want to be a believer in a bag holder and you just buy in now and wait. You know, it’s, uh, it, it’s a rough life, I’ll tell you, but, um, you know, I think, I think probably, yeah, probably the better thing to do would be wait, you know, let, let the price action, let the market agree with you, right?
And that’s probably why, you know, it, there’s probably a why, there’s probably a reason why all these, all the best companies, right? Like they go sideways, you know, the, that pattern exists for a reason, right? And it’s because there’s some early product market fit. There’s usually this big runup and then the bubble pops, and then, you know, like no one has the time to go deep into every company, right?
And so, like, it, it funda it fundamentally makes sense to me, right? Like the market, like the market’s always right, but at the same time, right, like, you know, prices are reflexive and people are highly emotional and, and like to buy high and sell low. And so it makes sense to me that, that, um. You know, a lot of these, a lot of these companies that you point out and, and you’re referencing their, their, uh, their price charts, their, you know, since the early two thousands, like, and they had this long kind of sideways period.
Like it makes sense to me that, that that existed. And, you know, I’m sure during those years there are people like us that were advocates for those companies as well. So, um, you know, it’s going sideways right now. There’s no need to rush to buy this thing. Um, you know, we could be kind of in for the end of a, the tail end or the start of a bear market in crypto, right?
Like if the four year cycle holds, I don’t know if it’s gonna hold. So, you know, you don’t need a rush and, and, and, and buy this thing. But, um, what I will say is that, you know, as someone that’s now worked in the space for, um, a while now, been a, um, crypto research analyst specifically for over two years, like, I guess my, my confidence in, in this project has only increased.
Um, and it’s at its highest. Today. So, and that’s based on, you know, I think where the market narratives are, are heading as well. Um, but yeah, just let the price action confi confirm it and then just ride the wave and, and it’s, and you know, I think that’s probably the, the best move, honestly. I,
Yeah, I mean, maybe the last thing I have to ask you, Daniel, and then maybe Luke, you could, you could, uh, end us with whatever, you know, where you land after hearing this back and forth. The last question I have for you, Daniel, is, as an investor, I have a weak spot, which is like a, like my avatar monkey being high leaning towards risk on, I do get excited by, you know, seeing the immense potential, and I’m usually too early and I, I know this about myself.
And like any good investor, you have to see yourself clearly,
uh, to, to change and to, you know, get better. The thing that makes me quote unquote, uh, more impatient than, than, or maybe more excited than I ought to be is when I look at the governmental layer right now, the procr. Um, administration,
but the what everybody, you know, the passage of the Stable Coin Act was a shock at how quickly that happened. Them inviting Chain Link and sitting Sergei next to Trump just a couple months ago, they’re back in DC again now. A bunch of stuff coming out on x talking about, you know, the last patches that need to be fixed. To me, it kind of feels relatively imminent. Um, I don’t know what that, whether that’s I three weeks or three months. Do you have any sense of how soon we actually might get the, that last piece of legislation and if we get it, is it then like, okay, now we’re really ready to go and BlackRock’s gonna announce some like insane, like, okay, we’re buying blah, blah, you know, or am I overhyping that piece of it?
no, I think, and this is coming from, from Sergey, right? Because like I’ve watched, you know, I’ve watched every interview as well, but his timeline is, um, things will go live in production in 2026. 2027 will be like a kind of take stock year. Um, you know, what worked, what didn’t. And then 20, 28 and beyond is, you know, kind of the scaling and takeoff.
But I do think that, Trump, like they’re, they’re kind of in a race against the midterms here. Um, and right, like the midterms could be a catalyst or a bear or, or a bearish event for, for crypto. Um, so like, it could be as early as next year. Um, it could be 2027 or 2028, like, I’m just, I’m, I’m, it, it feels imminent.
Um, I think that the CLARITY Act is, is one of the last big, um, which is the market structure bill. Like, that’s one of the last big, the big, uh, big pieces to fall. Um, but you know, I’m, I’m, I’m not, I’m done with in the, I’m, I’m no longer in the business of predicting timing here. Um, but yeah, I mean, I think for me it’s, you know, put up or shut up time.
Um, I think the next three years, the thesis is either validated or invalidated.
Badge you’ve listened to, to us talk at length. Uh, what’s your, uh, how are you gonna upgrade your
own mental model about, uh, Chainlink as an investment?
Daniel got me actually with his comments about, Consensus and potentially something like Chainlink becoming the way that AI understands the world and that the reality of the world, um, that is quite interesting. It hadn’t occurred to me. Um, so there’s a whole bunch of stuff that could be incredibly valuable and I do want to own more link and I’m trying to find the right way to do that.
But at the same time, like the thing that was holding me back and I think still holds me back a little bit is as someone who’s worked in like the finance sector for one of the world’s biggest banks for 25 years and has worked in payments and has worked with Swift, like, like the, the, the banks still use like Cobalt and they still use like ridiculous legacy technology.
And so like this crypto stuff is moving at the speed of light, but like, it’s a almost like, like a, a bad metaphor. It’d be like trying to install like a Ferrari engine into a horse drawn carriage and it might look beautiful. But it ain’t gonna work very well. Um, so the finance sector is very slow to adopt this stuff properly.
And I, and you know, the insights from that conference are interesting. And if, if things like Link can plug into Swift to kind of augment what’s already there, it’s very easy for the banks to adopt it. So that’s gonna make stuff move fast. But then you still have the regulation, which is like horrific. And you know, good comments, Christophe, about the Trump administration, like fast tracking some of this stuff and being behind it, but at the end of the day, they don’t tell the banks how to operate.
Um, and they don’t, uh, well maybe they do to some extent immorally, but they don’t really set the laws that the banks have to operate to. So, um, yeah, I think it’s gonna be, I think it’s gonna be a slow journey to adoption, but I’m more of a bull on link than I was like an hour and 15 minutes ago.
Any last thoughts Daniel?
no, no. Big last thoughts. I think, um, yeah, I mean I think these, these discussions are interesting, right? And, and thinking about like yourself as an investor versus a trader. Um, you know, what are individual goals? Like, really, like it’s, it’s not a meme. Like all that stuff really does affect how you should invest and, and everything.
And I, I think with Link like. Yeah, I mean, I think my biggest takeaway is, um, you know, I, I think let, let the price action confirm the thesis. And once that happens, um, hopefully you’ve done enough research where you have the conviction to really size that bet. Um, ’cause you know, if you put in a negligible amount of your portfolio in now and you’re like, I’m a believer, right?
And then it takes off and that, like, you don’t make that much, right? You’d probably make a lot more of letting the market confirm this thesis and then really sizing it. Um, and so I think you have, you know, there’s, you, you got time here. Um, but yeah, especially given, given kind of the macro dynamics and, and Bitcoin, right?
Like, there, there’s a lot of time here, so, um, you know, start following it, do your own research. Um, but yeah, I think when the, when the time comes, I, I do think it’ll be quite obvious and, um. When like these types of events, like these multiple kind of expansion events, these, these repricing events, I think that’s when you make the most money in markets, right?
And like the most obvious example is Nvidia, right? That was already a massive company that 10 XD in market cap, like to obviously right? Because of this, ’cause of this one catalyst. Um, and uh, yeah, if you sized into that, like you’d probably be retired. So, um, I think that that’s, you know, I think that’s the important takeaway here is I think, you know, I’m in the weeds all day here and, and um, in, in crypto and I, I really think this is this, this is the one with the best bet.
But, um, you know, doesn’t mean you have to buy and hold from, from here. So I think that’s probably the biggest, the biggest takeaway. Let, I think, let, let the market confirm it first. But when you are seeing that confirmation, don’t, don’t get scared. I think that’s the time to really. Size in, and hopefully you’ve built up your conviction enough to, to size, to size in when, if, if, and when that, um, you know, that catalyst occurs.
I think that was your conclusion last year as well, so that’s actually good that you are still consistent on that. If we bring, if we get you back on this time next year, is that the episode where you’re gonna finish by saying, shut up guys, just buy it now. Buy now.
I, I hope, I hope. But yeah, let’s make it a yearly thing and yeah, at least for the next three years, I’ll, I’ll sign up right now. So just tell me where to sign. I’ll, I’ll be on, uh, December 20, 26, 7, and eight.
Daniel, where can our, uh, listeners and YouTube Jungle Beasties find you, uh, most easily.
Yep. So you can find me on Twitter at at underscore dcha. DSHA.
Thank you so much again for, for your time. This has been, uh, a true pleasure,
You got Al. Always a blast. Always a blast.
Awesome, Daniel. Thank you. Good to catch up and have a great Christmas and New Year.
happy
holidays. Hmm.
That was a cool discussion, Christophe.
And, sorry, I was, I was, yeah, I was trying to, I’m trying to be a bear about this stuff because I’m trying to kind of hold you back a little bit and keep us grounded. But this is exciting stuff, right? And you know, this guy is clearly an expert and what did he say in the closing like minute there? Like, this is his favorite
opportunity in the whole world of crypto right now.
So like, you gotta put a lot of stock in.
Yeah. And, you know, uh, and, and to my point a little bit, um, I think for terms of principles, I think hearing myself say what my weak spot as an investor is getting too excited about. I’ve done this over and over and over again. I see the potential, I see things happening. But in the real world, things just take longer than you think. Uh, though that is sometimes balanced by the market, always being forward looking. So there is, you know, um, that case to be made. But in this moment. Uh, I think Chainlink is what my number four in the king of the jungle portfolio. I just got to a hundred tokens. To me it’s a nice symbolic, you know, round number. Um, I don’t, I’ll put it to you, this blankly badge in all of, call it the markets. I don’t even like the word crypto anymore. Given that chainlink is sort of bridge in worlds, I don’t think I’ve ever come across a more asymmetric bet than this one based on, call it the, what I understand the fundamentals to be. Now it is a question of, as Daniel was saying, you’ll know, you’ll know if, if things are legitimately playing out because the price will will tell you and,
That’s, that’s nice that you’ve got, you, you, you know, you’ve got a bit of control. ’cause if it is like your most. Asymmetric bet, like the Crystal io will be a hundred percent all in this alone. Nothing else. So at least you got some diversification. Well played.
Yeah, there’s, there’s a little hope for me maybe, but that’s in part because I’m not, you know, I can’t sell my eos ’cause that’s ano, you know, so regardless, uh, we hope, we hope, uh, you know, it, it was educational and, um, it’s a fascinating space to watch anyway because it involves updating the entire world’s global infrastructure.
That’s not like, that’s not a weekend project, you know, someone does in your, in your garage. Um, the only one additional point, I don’t know if, I’m not sure this is an error on your end or you just, it’s implied, but by what you said, you know, when you were talking about the way old Swift used to work, run on cobalt and all these, um, rails, Chainlink runtime environment is the new rail. And the big boys are already in production on that. So to your point, it’s just a question of how fast can
the horse
maybe. Maybe. I misspoke. Swift got modernized like a bunch of years ago and it’s still being improved, but the banks still have like essential services running on Cobalt, and so you reflect on that like. Ludicrous dependency on like 50-year-old technology. How quickly are they really gonna adopt some fancy new thing beyond some little niche?
And you know what, and maybe the, the takeaway for me, uh, from the investment standpoint is hearing our conversation. To me it’s obvious the value proposition. It’s what we started with. When you tell any bank in the world or any financial system, like you can make more money, you could do it faster, you could reach more clients. And we’re gonna make it as easy for you as as possible, easier than you thought. There’s no money manager, you would ha you would have to be almost like oppositionally dug in out of some kind of like,
No, no, no, no, no, no, no, no. You’re wrong. Like I agree with you from a business perspective, but at the same time. If it’s like, if you are the guy running like the book or you know, running like transactions for your customers, not only have you got like reputational risk if something goes wrong, what if you breach your financial crime obligations and inadvertently you facilitate like money laundering or sanction payments, you lose your banking license, like you’re out, right?
There’s very good reasons why the banks are super slow and conservative to adopt new technology.
Right. Which also actually chain link start with security first. They hired the world’s best cryptographers to make sure the one thing we’re not gonna. Uh, fault on is our, our security protocols and to this day, remains has a hundred percent track record. So you’re right to your point. We know how important that is. So anyway, um, a fascinating thing to, to continue to follow and learn about. Um, it,
it also, and for the end consumer, you know, like when this starts happening, it’s kind of wild, you know, you’ll be able to sort of go to your own bank. I mean, literally, like, you’ll open a nap, stake your collateral, and out the other end you’ll have money with no bank teller, no Wells Fargo, no nothing.
And it’s kind of like mind blowing what that will do for anybody, especially for people that have never had access to kind of instant capital. But that’s for another, that’s for, you know, that’s
save it. Save it for next year’s episode with Dan dha.
okay.
Yeah. Hey, before we break though, there is a whole bunch of exciting stuff we’re gonna talk about. So, uh, I’m sorry if you’re on the YouTubes and the, like, not in the Patreon community, but when you hear this, we already had our Christmas party. I can almost feel like the hangover that we are gonna both incur this Friday on the Patreon exclusive live stream and feel it coming back in town in time and like impacting me now.
And I’ve got, uh, I’ve got a couple of gifts over there as you are unopened. I will have opened them by the time this goes out and I can feel something sloshing around in at least one of them. So I think you’ve got some spectacular booze for me to consume. Um, but so you missed that. But what you didn’t miss is we have our community portfolio month two for December.
Our Patreon community are nominating, or they have nominated nine really interesting investment opportunities. And now within the Patreon we are voting, uh, we are right in the middle of voting right now. There’s a clear leader. I’m not gonna say who that is, but it is a Patreon favorite. Um, and, uh, I think in about 10 days time we’re gonna close the voting.
And then Christophe, you are gonna buy real money, a hundred bucks of your real money in whatever our Patreon’s pick for their community portfolio. We’ve got some really good quality, like one pager stock pictures now. So if you wanna check ’em out, go swing by Wall street wildlife.com, which is our Patreon.
Um, if you want to hear about Twist Biosciences, a ST Space Mobile, Zscaler Junior Harrow. Alta Solaris Energy Infrastructure, ire, or Roku, our community have put together a one pager on each of those between them. So check it out if you’re interested.
Yeah, it’s the, it’s why our community is just kicking all kinds of VAs. Uh, we’re investing together and we’re sharing info. And so if, you know, if you happen to be a relatively random person, just, you know, uh, finding us on the YouTubes, uh, badger and monkey always say that you become a better investor when you do it with a group of people. Who are working together to share their experience, their mistakes, their successes, and now their intelligence and research. And so it just goes so much better for everybody. So hop on over to patreon.com/wall Street Wildlife where you can become a.
Beast of an investor.
