GM everyone. Welcome back to The Big Picture where we unpack the intersection of crypto, of macro, and of politics. I'm joined, of course, as always, by Mr. Thomas Bahamas from just across the pond. TB, how are we doing today?
I am doing great. GM Jack, I'm excited to chat.
As you should be. I'm super excited as well. Now, we've had the pleasure of speaking with him a few times on Solana Floor in the past. We know him and we love him for all of his hot takes, but there's always some knowledge as well that I think people need at the moment, some optimism that people need. So, very much looking forward to asking him about the macro reality that we're dealing with that's sort of going against us at the moment. But also you might have heard that his fund Dragonfly raised $650 million in a fourth fund. So super excited to find out where some of that capital might be going. Now this is a man who needs absolutely no introduction unless you've been living under a rock that is. So he's not going to get one except we all have to say the congratulations to Dragonfly for the 650 million fourth fund and he is also the host of The Chopping Block podcast. So if you haven't then do go and listen to that. It's become a genuine staple of mine over the years. Beyond the hot takes, a lot to learn from Haseeb and all of his co-hosts. Now, Haseeb Qureshi, welcome back to the Salon. Welcome back to Solana Floor, I should say, and thank you for coming on to The Big Picture this time.
Thanks for having me. Good to see you again.
Absolutely. Now, Haseeb, we're going to start at a very high level. I'm in a friendly way hopefully going to hold you accountable here for some of the things that you've told me in the past. It's becoming a bit of a tradition now. Cast your mind back to 2023. We were talking in Dubai, I think, and I asked you what one of the most overrated narratives of the year was, and you said it's probably AI x crypto, probably a bit of a nothing burger. That was spot on. Then fast forward to 2025, you said celebrity meme coins were likely going to be a nothing burger. You sort of looked at me at the time and you thought, 'How is this guy genuinely asking me about strippers coming into a conference?' So apologies for that, but it was worth talking about. We come full circle, strippers at a conference once again.
We have now once again we are talking, strippers are on the timeline. It's terrible, terrible optics but I have to ask you, what's the biggest nothing burger of 2026?
There is still so I mean okay I think there's crypto AI that's finally more real now and you can see like for example Venice which is you know it's blowing up on the timeline. Venice unlike many of the other things in the crypto AI of yesteryear is a real product with real users, real revenues, real customer retention. It's not like if you remember the Zerebro slash you know GOAT or all this stuff where it was kind of or even AIXBT where it's like, okay, this is cool. It's kind of an interesting performance art, you know, it's monetizing. And that's I think the real big difference between what you see today in crypto AI and the stuff of yesteryear. That said, there's still a lot of noise. There's still a lot of shit that occupies the timeline and gets people excited. I think the half-lives of these things are much shorter today than they have been before letting them really start to take off and run away. Today, you know what, it's not super obvious to I guess one thing I would say is that I do think there's a I wouldn't say it's a nothing burger, but I do think there's a little bit of overemphasis on some of the you know enterprise stablecoin chain stuff. I think again a little bit of the air has already pulled out of this market. You remember the craziness around Plasma? Plasma's obviously come down to earth in a very you know kind of sobering way. But I think we're going to see more of that. I think we're going to see more of this idea that like oh these chains that are just these kind of stablecoin settlement chains. I think they're not going to be valued that richly. I don't think there's that much of a story about why these are going to be more than just okay this is a you know a clearing platform. This is nice but are these really that valuable? Are they going to be capturing a lot of MEV? Are they going to be attracting a lot of developer attention? And I think at the end of the day that's what makes the biggest blockchains valuable. So, is the market overvaluing these things? I don't really know to be honest. Right now, the market is kind of in the doldrums about everything besides Zcash, Hyperliquid, and maybe, you know, Venice and a few other things. By the way, in which we're investors in all those things. But that's one thing I'd say I'm probably moving a little bit against the grain on the market with respect to that.
Yeah. I tend to agree. It's not very exciting to just have like settling stablecoins on a blockchain, right? That's not what we're here for. And you know, it is great to meet you, Haseeb. Welcome to the show and thanks for having me.
Yeah. And before we get into, you know, Dragonfly and where you guys are deploying, I wanted to kind of do a quick vibe check on, you know, where are we in the big picture when it comes to crypto, when it comes to macro. You know, I am a massive fan of kind of your analysis and how you look at the market. And I think that you kind of generally come with hot takes about any topic. So, I mean, what is your take on the crypto market right now? You know, we're kind of seeing a little bounce right now. It feels a lot more exciting than it has in a while. So, you know, I woke up excited this morning.
Okay. Well, I'm glad you're excited. I don't know how hot my takes are today. I'd say I think most of the time that you see these big washouts like right now what you see is this tale of two cities in crypto, which is that from a retail perspective, crypto is still in the doldrums. There's not a lot of energy, not a lot of enthusiasm. There's only really enough energy for a few assets to be doing well. So you can see Zcash is doing well. Hyperliquid is doing well. Venice is doing well. There's a few other green shoots of things that are well positioned right now. We've seen, you know, a little bit of an upmove in the perps and so on over the last few days, but on the whole, Bitcoin, Ethereum, Solana, the majors are still really dragging ass right now. And a lot of that is because there's just not enough money entering the space. You know, if you look at the ETF complex over the last week, ETF complex really drained a lot of the capital that came in over the last few weeks. The Iran war is still, you know, all the macro uncertainty is still hanging over the broad spectrum of risk assets outside of AI. And you see the same thing, the same story is being told even in the stock market. If you look at non-AI names, non-AI names are down quite a lot over the same period of time that crypto has gone down. Now AI names have more than made up for it. You see S&P and NASDAQ are hitting all-time highs. That's because of how much Nvidia and Apple and, you know, Google have been pulling up the stock market because of their AI exposure. So, and the memory stocks and all other stuff, you know, all the infra companies that are enabling what's happening within the AI boom. So I think that is reflecting in crypto. Until there's some macro normalization, I expect crypto to continue to drag in that way. And there are some real macro headwinds happening everywhere. You know, just the fact that it's gonna be much harder for the Fed to cut, much harder for them to be stimulative. Everything happening with oil, I mean, it's such a massive input into global productivity that no surprise that we're not going to be in a very stimulative risk-on environment net of AI. AI is so transformational in other ways that it's overcoming that burden that macro is not being cooperative. But AI is so big that it's causing things to rally anyway. And I think that's the right way to understand what's happening in the broader risk environment. So crypto is downstream of that.
Yeah, there is this anxiety. I'm curious if you feel it as well that the AI brain drain is not only impacting a majority of the economy, but at least on crypto Twitter that it's hit crypto much harder than people anticipated. Whether it's devs, whether it's builders, whether it's VC money, people really think that the AI brain drain is impacting crypto super negatively. Do you feel that people were sort of blindsided by this? Because I feel like for a long long time we've been talking about how transformative...
I would agree with you. I'm a little bit surprised that people feel blindsided. In general I think a lot of people have this very Terminator world or whatever they're going to turn us all into paperclips mindset that oh if AI gets too big it attracts too much capital it attracts too much talent that's going to be bad for crypto. And it's almost as though that would imply that crypto will be better off if AI doesn't happen or if AI is weaker. And I think this is just totally backwards way to be thinking about the world. Crypto is not the only technology. There's no universe in which crypto is the only technology. A universe in which AI is not taking off. A universe in which AI does not attract good talent, which doesn't attract capital, where there's not going to be breakthroughs in AI, is a world that's worse for crypto. Crypto is more valuable in a world that's technologically accelerating. Like this is crypto is money for a technologically enabled future. If everything else is standing still that is worse for our bags. So I think this kind of zero sum thinking about like look I am glad that there are people who are going into AI to go build valuable things to move the future forward that's good for crypto. The idea that like oh we need to like narrowly hold on to this thing and think of ourselves as being zero sum with other technologies is not just stupid it's also wrong. So that's why I totally reject this concept. Now, like the reality is a lot of the net talent that's coming into crypto is not coming in from AI. It's coming in from fintech. It's coming in from traditional finance, right? Those are the guys for whom yeah. Traditional fintech is kind of boring. And all of those fintech companies now are moving into stablecoins. They're moving into tokenization. They're realizing like, hey, this is where the marginal growth is going to come from. That's why you see Stripe leaning so hard into it. It's why you see the biggest fintech companies in the world, PayPal. You see increasingly all the financial institutions whether it's Morgan Stanley with E*TRADE just in the last week or you know you see Klarna, you see Revolut, you see Robinhood all of them are coming into the space and even Meta now is realizing oh we want a piece of this pie we want to make sure we're not late to being able to adopt blockchain crypto stablecoins all the stuff happening in the space so I think this anxiety that oh you know AI is eating our lunch is just so misguided that's like your picture of how the future is going to play out is sort of like it's so wrong it's like not even wrong, you know? It's just like a distortion of reality to believe that what you want is that nobody goes and works in AI and they all work in crypto instead. That's I guarantee you that's worse for you if people are not going to go and build the future in AI.
In a way, I feel like it's sort of a spin-off of or rather a continuation of some of the tribalism that we've suffered from over the last decade. You know, I don't want people to work in the Ethereum ecosystem because I'm sort of only invested in the Solana ecosystem and it seems that that mentality sort of transposed into AI versus crypto, but I agree with you that it's not as much of a or it shouldn't be something that blindsided us as much as it has. Now, you mentioned something there a second ago on the macro front that I just want to go back to. So apologies for derailing the conversation with some AI anxiety there. But you mentioned things about you know Kevin Warsh not being able to cut rates to some extent. You know, Strait of Hormuz economists have actually come out and said if we don't open it fully within the next four weeks we're probably dragging our feet in towards some sort of global recession which bit of a doomer call but you know hard to imagine that being impossible. Now, how screwed are we perceive on a scale of 1 to 10? If Warsh really doesn't manage to cut rates in, let's say, you know, the next six months, is that the sort of crux of what we're dealing with right now?
I don't think so. If you look at futures markets right now, they're not pricing in rate cuts anyway. So, like the market is always forward-looking. The market is always assuming the median path. Right now, the median path is, you know, basically this is what rates are going to be plus or minus, you know, 25 bips or something like that. Like there's not going to be much movement either way is what markets are currently pricing in. That is the backdrop that markets are assuming when they're pricing Bitcoin here, they're pricing ETH here, they're pricing SOL here, they're pricing all other stocks like so it's not like okay well if this does happen what will happen. We're already seeing the future right now of what's going to happen if Warsh can't cut this year. So, I expect that to be the case. I do think the markets are not pricing a quick resolution in Iran. But they're also not pricing a global recession. So like no look this is not good. It is very very bad especially in emerging markets for the constraints that we're seeing on energy and there's tremendous real hardship and suffering that's happening around the world because of what's going on in the Strait of Hormuz. No question. And it's not likely that we're going to get to a resolution soon. I think you know you can see that in the forward curve on oil. You can see that Polymarket is telling you the same story. But the reality is that the world is pretty resilient. And you know increasingly I think that the biggest lesson I think from all of these things is that you know within a few years the Strait of Hormuz is going to matter less and less over time because the story of I mean just the story of all markets is that the moment they realize that they're bottlenecked they start routing around and so you will see new pipelines get created you will see more and more paths to diversifying energy sources all around the world because people learn lessons very quickly. And so to the extent that like you know the same thing with rare earths right like the rare earth that are going on in China everywhere in the world are investing into rare earth manufacturing and supply chains because you know the moment that you grab somebody by the balls they're going to invest in ball cups and that's what's happening right now in the Strait of Hormuz it's happening with respect to rare earths and this will keep happening this is just how capitalism works.
Yeah. Well said. Well said there and one more macro question for you. So we're seeing some good odds on CLARITY. We're seeing some good movements on the CLARITY Act going through. How much are you focusing on this? And like what do you see the repercussions being for this passing? Like are you expecting, you know, certain areas, certain sectors to really grow after this or what's your take on CLARITY?
So yeah, it does look like CLARITY is close. That said, you know, never underestimate the laziness of Congress people. They are you know this is one of the many many things on their agenda and you know they don't do a lot of work in the summers so there is a pretty tight window to get this thing passed and there's still the big stumbling block of presidential ethics right so the Democrats are very animated by getting some language in here that's going to you know it's technically governmental ethics like okay government workers or government officials can't do X Y or Z everybody knows what this is really about which is the Trump family. Democrats care a lot about this. It plays very well on a national level. So I think there's going to be a lot of resistance to getting a resolution on CLARITY. And if CLARITY stalls, if it fails in the Senate, that's probably going to be why because ultimately you need 60% of the vote in order to get this thing passed, that means you got to get people across the aisle. So, I think, you know, Polymarket right now is pricing like 60 to 65% depending on the day that this thing passes. I don't think I have any alpha one way or another over and above that. But let's assume that this thing does pass. If CLARITY does pass, I think it also is a little bit of a there's going to be a very delayed reaction because the moment CLARITY passes, like if you just read CLARITY, the bill, there's a lot of stuff in there about what needs to happen through rulemaking from agencies. So there's stuff for the SEC to clarify, CFTC to clarify, you know, OCC, FinCEN, Treasury, a lot of work needs to get done to turn this bill into actually legible laws that people can follow, right? But there's a bunch of stuff in there that's basically like placeholders that, you know, pending what the CFTC decides, pending what the SEC says, pending what, you know, blah blah blah. So the moment that CLARITY passes, there's not anything that's going to change immediately. Like maybe a few things will happen but for the most part like the real meat of the regulations are going to be pending rulemaking notice and comment periods, you know, feedback debates so like it's going to be probably at least a year if not multiple years before we actually know what CLARITY looks like at implementation and so there's going to be something of delayed reaction I mean people are going to be very happy it's going to be a celebratory moment to have a real substantial body of law finally about digital assets and that'll be great and I will be very happy to see that as well. But most of the real meat of the legislation is not going to come into effect for years. So I think it's important to be clear-minded about that even if it does pass that it's not like all of a sudden everything's going to change or oh there's suddenly a bunch of disclosures that are now being made by all these protocols like the disclosures regime that's contemplated in CLARITY has to then be specified by the SEC.
Yeah. And so we'll have to wait for the SEC to come up with this body of rules of what the disclosure will look like. They'll do notice and comment. There's going to be debates. So yeah, nothing's going to change overnight just because CLARITY passes.
Yeah. So long term it's bullish, but we're not longing all the coins immediately when it happens.
I mean, I've longed all the coins, but what happens?
Why not? You know, it seems like a good thing to do.
All right. That enough macro for now. Let's get to your fund. So $650 million in February. You raised it and there was a great quote that you dropped that non-financial crypto has failed. So I want to hear about this and what your take is there and kind of the overall thesis for where you're going to be going with this fund.
Yeah. So this is one of those takes that I think when I was originally saying this that crypto is primarily about money and finance I think it was more of a hot take. I think today it's not a hot take. I think basically the world has come to agree with me that this is basically what crypto is for. This is what it's about. There are still some experiments being ran with respect to decentralized social media and you know some of these other games there. It's not like these things are all gone. But it's clear that the beating heart of crypto is about money and finance. And that's always been true. It's been true whether it was, you know, thinking about Bitcoin, thinking about Ethereum and financial contracts, whether it's about ICOs, DeFi, RWAs, stablecoins, prediction markets. All these things are about money and finance. These were the big awesome gigantic use cases that lit off these fires that spread around the world. And there were stories that we told about, oh, wouldn't it be cool if there was decentralized social media? Wouldn't it be cool if there was gaming? Wouldn't it be cool? You know, there were all these things that we thought, well, that'd be so amazing if the art world were totally, but the reality is the things that actually worked and were adopted bottoms up, almost all of them were financial in nature. And so, that was my thesis. I've been saying this for years. You know, I remember being, you know, debating people at a16z back in like 2020, 2021 in the heyday of NFTs and crypto gaming and all this stuff that like I didn't think it was going to work. And we mostly didn't invest in it. You know, we made a few small investments, you know, but it was at the most a couple percent of our funds we ever invested into any of the other stuff because we, you know, there was a certain point I was like maybe, you know, who knows, maybe I'm wrong. But more and more we came to discover like no, it turns out that as always, the really really obvious gigantic advantage that crypto has is in the realm of money and finance. And so us raising this fund, you know, me saying that in the launch announcement was a little bit of a victory lap. Not so much. It wasn't so much like an explicit thesis. I think on some level now this is everybody's thesis. But it was more of a you know kind of bringing the story home and kind of tying a bow on it. Recently just before that I got into this online debate with Chris Dixon of a16z. They also congrats to them. They also raised a massive fund 2.2 billion. Obviously they play in a bigger tax bracket doing mostly growth investments relative to us you know we play more early stage but has recently raised their own massive fund and Chris Dixon he wrote this post talking about how well if you look at the non-financial use case of crypto they were really held back because of regulation also because you know just the timing wasn't there you needed more infrastructure to be in place and now it's finally there and the regulation is finally good and the enemies have disappeared and now finally we can truly run the experiment. And I got in this big fight with him where I was like, I think this is bullshit. You know, this is cope. This is not true. Like there was, you know, all the regulation, all the negative attention, all the scams were more focused on DeFi and financial use cases than they were on decentralized social media or games. Like who was shutting down games? Who was scamming games? I mean, I guess there were some game scams, right? But like the scale of it was nowhere near what it was in DeFi. And DeFi won anyway because it's just so good. It's what people actually want. It's where the product market fit is. And so, you know, that was part of the reason why I folded that into the announcement of the fund. So, with this fund, what we're mostly focused on is the same old shit to be honest. I mean, that's part of the story is that look, my thesis hasn't actually changed that much. Other people's thesis have changed to come more in line with mine, but you know, our thesis from the beginning has always been like look, DeFi is enormous. We think there's lots of use cases at the intersection of traditional finance and crypto whether it's stablecoins, asset tokenization. And then of course just the good old stuff of infrastructure that still needs to improve and still needs to grow. You know I don't think blockchains are done. I think I've been arguing that for years. And then lastly I think the intersection of crypto and AI as much as I did I guess say in 2023 that I thought the crypto AI stuff in 2023 was bullshit, you know, this was the generation of Virtuals and the AI meme coins and the chatbot coins and so on. But I think today it is becoming real. You see that with things like Venice, you see it with things like, you know, Nous Research launching Hermes agent and so on. There's a lot more stuff that we now see has teeth. People are actually really using it. And I think, you know, even with something like X402 and payments, it's very early, very, very early, but you can see that it's starting to grow. And it reminds me a lot of what DeFi looked like when we started investing in DeFi in 2018.
So that's DeFi 2018. A great bit of optimism. And I just want to get a little bit more specific here because it's safe to assume you're not going to put $50 million of that 650 in something like web3 gaming in 2026 based on what you're saying, but you did just invest 50 million in Variational. So curious what your thesis there is. And secondly, would you mind explaining or sort of giving us a bit of insight as to where in that sort of intersection of AI and crypto we might start seeing funds deploy in, you know, 50 million, 100 million clips because you mentioned a16z raised 2.2. Paradigm raised a billion dollars. I think Blockchain Capital raised something like 700 million. So very serious sums of money are going to get deployed and I would argue that significant sums of it will be deployed at the intersection of AI and crypto. Curious where you see that money going. And then your first question is why 50 mil in Variational?
