Why do I have to like trade like 9 to 5 or like these random hours? Like why are the exchanges closed at all this time when it's just computers and you know data centers? So it's like oh wow, 24/7 markets, it makes a lot of sense. So there's not really a network yet for agents and agents need to consume compute.
You don't think stablecoins will be the currency of the agentic future?
And so if you have trillions of agents all doing transactions at the speed of light 24/7, then you can see how it can be extremely valuable.
Hello and welcome back to the Binance Studios. I'm joined by the one and only, Mr. Arthur Hayes, CEO of Flop Labs. Arthur, great to sit down with you. It's been a whole year. How are you doing?
We've got a lot to discuss because I think every year I sit down with you and I always get the alpha of whether it's kind of Dog with Hat of 2024, memecoin mania. This year it's been traditional markets on chain. We've seen perpetual futures go crazy and then also agentic payments and the AI ecosystem, all of which you've got some comments on. So we'd love to dive in. First of all, out of the three that we've mentioned or any other narratives for this year, has there been one key standout for you?
Obviously, I'm launching my own AI payments network. So that's what I'm super focused on, like AI data center buildout, that kind of stuff, the bait of the bubble, the collapse, and then obviously how it impacts what I'm building at Flop Labs.
Perpetual futures. First of all, I think the fascinating thing about this is if we look at the concept of perpetual futures hitting the market. This came in 1992, the first paper proposition, which was before we saw even ETFs hit the market in 1993. You were the one that came and actually brought it to the market. And I think what's really interesting about you, Arthur, is you were able to see what kind of trends or consumer narratives people would be interested in and help bring it to the user. So, when we look at the perpetual futures space in 2026, were you surprised at the attention that it really gained?
Um, not really, because when we started, we invented these things at BitMEX in 2016. We always thought about this, it'd be great to trade S&P and NASDAQ and all this stuff using Bitcoin as collateral and then using these futures contracts and swaps to trade them. So, it's great that we're finally there. And I think as people have gotten used to trading 24/7 on crypto and then you add it, okay, you know, shit's happening on the weekend, so I would love to trade oil when you know things are getting bombed. And then you go to Hyperliquid when you start trading these things, right? It's like, oh wow, 24/7 markets. It makes a lot of sense. I'm off of work. Like why do I have to like trade like 9 to 5 or like these random hours? Like why are the exchanges closed at all times and it's just computers and you know data centers. So I think there's a lot of things that don't make any sense in tradfi and we've eliminated that in crypto.
We've gone to the essence of trading and now obviously because all the retail traders are like, I don't want to trade on CME or NYSE or like Eurex or these, I'm going to go trade other exchanges. Then of course they're like, okay, well, we're going to, you know, let's bring them on to this so we can get some of that flow.
But you guys, you called it there first. So we've talked about the three key narratives and trends of 2026 and they're all kind of connected in some way. And I think the key being if we look at where we're going to be in five or 10 years' time, the amount of economic actors at play are going to be larger and greater because of AI agents. So it's going to be more opportunities, also there's going to be wider breadth of products and also 24/7 capital markets too. So when it comes to where you're looking to get the opportunity and where you see the opportunity, it kind of ties into what you're working with with Flop now. Where is the opportunity for engaging more economic actors coming on chain, as having 24/7 markets, of having traditional markets now on chain, where do you see the key pillars for opportunity?
Any product that has a great cash flow and is paying it out to the users, that's what people like, right? So obviously they like exchanges that actually, you know, make money and then they pass it back to token holders or equity holders in some way, shape or form. So the exchange is obviously one of the best business models ever if you're able to run it and have more people trading 24/7 all types of different products. It's just going to be a fee bonanza for, you know, the people who adopt this trend early.
And then for people that are watching the markets, they're listening to your Substack, reading through what the comments that you have to say compared to Bitcoin and gold, where do they stand in this play? This is something that you've always said is kind of like an accumulation play for Bitcoin and gold. Is that still the case or do you think there's wider opportunities out there?
I mean, traditionally at our fund, we basically, we trade different shitcoins. We make our money, we buy more Bitcoin, right? So, Bitcoin to us is obviously, it's low, you know, low beta in crypto. It's the least upside probably, but it's not going anywhere, right? And so, I think that's good for us as a fund. If you're an individual trader and you're like, I need to make 100x. Okay, cool. You need to trade down in the lower market cap kind of shitcoins, not really, you know, the Bitcoin maybe goes up two or three. So, I think that's the difference in our trading style, which is probably different than a lot of the viewers.
Yes. And for kind of institutional appetite for Bitcoin, I know this is something that we've been speaking about for years now, 2026, do you still think it's here, or do you think we've seen all the liquidity flow into possibly the AI narrative of the summer?
I think when money gets printed in the debasement trade or whatever they call it, there's a narrative in tradfi catches on, then they want to buy Bitcoin, they want to buy gold just like everybody else.
Okay. So, Bitcoin and gold are still the messiah that... [laughter] Okay, that's good. We're still in, we're still in jobs, guys. Um, now let's talk about what you are building now with Flop because I think it's really interesting to look at a specific agentic currency for this new world that we're seeing. Talk to us about the vision and the landscape that you see first of all.
So the vision is, you know, when an AI agent comes into being, let's say like late last year, they don't come with a payments network out of the box. Like, you know, when we're born, we kind of have to use one of these fiat payments, it's not like we can just go and create a new one. So there's not really a network yet for agents and agents need to consume compute and so they will want to hold the currency, whatever that is, that allows them to convert it directly into compute, the thing that they actually need to exist. So, if we're able to use the properties of Bitcoin, which is like have a miner contribute GPUs, process inference, get paid in this new currency called Flop, we can tie it directly to the GPUs and the compute that is needed to power an agent, then the agent will want to hold some of it.
And so, if you have trillions of agents all doing transactions at the speed of light 24/7 and they all hold a little bit of this currency Flop, then you can see how it can be extremely valuable. So that's why we say like, you know, theoretical blue sky maximum two to the n where n is the number of agents is like the north star valuation for the Flop network or whatever network is the one the agents choose and that's why we think it's such a massive opportunity. We think this is going to be the most valuable network ever created because you have so many agents now and even into the future.
