Haseeb Qureshi0:07
There's a lot of excitement right now around perpetual DEXs. So, you look at things like Hyperliquid, there's also Aster, there's Lighter, there's these new decentralized versions of exchanges that allow you to trade derivatives. There's a lot of excitement around them right now. I think it is warranted. You see that the volumes that these decentralized exchanges are now putting up is comparable to the centralized exchanges. So, there are certain days when the decentralized exchanges are actually doing more volume than multi-billion dollar companies. So, I think that's here to stay. That's not going to change, especially with the attitude from US regulators allowing these decentralized venues to be able to survive.
Some of these narratives that I think are a little more thin, there's a lot of excitement right now around the intersection of crypto and AI. I think that feels like it's not as strong. It feels like there's a little bit of BS in the market where there's stuff that isn't really being used, doesn't really have a lot of traction, but people are bidding it up and they're getting excited about it anyway. So, I think in the long run it's going to be real, but the first generation of crypto AI projects are not going to be what the eventual state of the market looks like.
A lot of the institutional adoption is coming through real world assets and stable coins. So, the story of crypto has always been bifurcated. There's been the consumer side and there's been the institutional side. And for the consumer side, you know, I was just talking about perpetual swap DEXs. This is for consumers. Institutions do not trade perpetual swaps. But the stable coin story, although it's very consumer story in that consumers are using stable coins, they're using Tether, they're using USDC, but it's also true that the institutions really want to understand how can they incorporate stable coins into their business. That is new. It really was not happening before, call it 2024. So, the institutional engagement with the space, whether you see it with PayPal or Stripe or any of these really large companies now getting into the stablecoin game, as well as the big banks trying to figure out what is their answer to stablecoins. I think that's going to be a lot of the narrative over the next year about how institutions can get into the crypto space.
So, the reality is that crypto chains are very mobile. They go where they can be regulated and where they can build their business. And so, what that means is that from a regulatory perspective, the projects that you back are going to find their way to the jurisdictions where they can serve the global market. Crypto is ultimately a global phenomenon. It's not US crypto, it's not Chinese crypto, it's not Korean crypto. It's global. And because it's global, that means that regulators are going to exert pressure in domestic markets, but the global market is going to continue to evolve and grow regardless of what happens in each individual jurisdiction. So, even the US, the US was very anti-crypto through Biden. And then when Trump came into power, he's made the US much more pro-crypto and much more welcoming environment for entrepreneurs, but the entrepreneurs were already there. They were already in New York even under the Biden administration and fighting against the administration, but then moving to Switzerland or Dubai or Singapore or whatever. And even if that changes again in 4 years, you'll see the same thing. So, from an investor perspective, I think the regulatory stuff is valuable for those domestic markets. But the global market is always going to be there. And that's where the majority of the usage and the demand for these products comes from.
