And so maybe you could help us wrap our head around these three components being compute stablecoins and the common language between blockchains and LLMs and why Ethereum sits at the center of these three pillars.

Sure.

I think of those three pillars as things that are essentially going to be for the next generation The means of production, the means of communication, and the means of payment.

But if I take a step back, in early days of any innovation, you sometimes need to focus on the use cases.

And I think Meta's release of Muse will start as a consumer assistant, helping you with your day-to-day tasks.

The second element is agentic commerce.

And you've seen estimates from Deloitte and others that there'll be somewhere between $17 and $30 trillion of commerce buying and selling goods driven by agents.

Is it providing some sort of intrinsic value? Does there need to be any sort of revenue share or revenue flows from that economic activity? Or is it more so this implicit perceived value of the place where the economic activity is settling? that leads

Do you think this is something at some point is going to pit Ethereum as an ecosystem versus Meta as basically a distribution hub?

No, I think the trust question you asked is critical.

It took our parents time to trust e-commerce.

It took us time to trust agentic and generative AI.

But I think what you're going to end up seeing, and this is really important, you're going to trust things where they can do no harm, meaning If you have an agent who wakes up every day, sees your paycheck get deposited, and you're in idle cash earning a fraction of a percent of interest, it will move you to another account that gives you 3.5%.

It doesn't take a lot of trust for that to happen.

When it rebooks your flight at a lower fee, you'll trust it to do that.

What does this look like in, say, 12 months from now, Joseph?

Do you think this is something at some point is going to pit Ethereum as an ecosystem versus Meta as basically a distribution hub?

No, I think the trust question you asked is critical.

It took our parents time to trust e-commerce.

It took us time to trust agentic and generative AI.

But I think what you're going to end up seeing, and this is really important, you're going to trust things where they can do no harm, meaning If you have an agent who wakes up every day, sees your paycheck get deposited, and you're in idle cash earning a fraction of a percent of interest, it will move you to another account that gives you 3.5%.

It doesn't take a lot of trust for that to happen.

When it rebooks your flight at a lower fee, you'll trust it to do that.

What does this look like in, say, 12 months from now, Joseph?

What does it unlock? What's the agent going to do with that money? How are they going to access it?

So if you take a step back again, idle cash, this $15 trillion that's sitting unproductive, means that Americans lose about $180 billion a year in lost interest.

And they don't do it because they don't care.

They leave it where it is, idle, unproductive, because moving it is either a hassle, no one reminds them, or they really just don't know that there are better options.

And the agentic economy and agentic capabilities are going to change this in a massive way, really for two reasons that people aren't talking about.

In our economy, there is a lack of financial literacy, but more importantly, there's a lack of attention.

Our entire society lacks attention.

But in the world that you're describing, what does Ethereum do that Bitcoin can't?

Will people still be leaning towards a traditional bank over going to, say, for example, Coinbase or Metamask or something like that to handle all of their on-chain finance?

I think the adoption curve will be faster than you think.

Think about e-commerce.

How many of us in our 20s embraced it, but our parents did not? And now my parents spend more time on Amazon.com than I do.

Think about social media and giving up your data.

People embraced it.

Think of generative AI.

What are your general thoughts on this uptick and perhaps the general causes? And if you think all the bad times are behind us, are we out of the bear market?

Why is that the wrong thesis, the wrong perspective to have from someone who's on the ground working with Ethereum day in and day out?

Yeah, I wrote a piece and I want it to be very thoughtful.

And I want to start by saying the folks who proposed that are not bad people.

They actually have ETH and Ethereum at their heart.

I find them to be a more academic crew.

But when I wrote the title of my piece, I tried to keep it as simple and digestible as possible.

The wrong proposal at exactly the wrong time.

I think since

the steward, as it were, uh, for the Bitcoin ecos- uh, the Ethereum ecosystem.

Yeah.

For your viewers, Ethereum is coming up to its 11th birthday this July.

It turns 11 from its original block from 2015.

Never gone down.

And for most of that period, for the full decade, Ethereum's core work was done almost entirely within the Ethereum Foundation.

That era has ended, not because of the foundation has failed.

But what's your general sentiment right now on, on these kind of metrics and, and what you're telling, uh, investors?

What are some of the initiatives?

So, um, let's start with the positive.

Ethereum has the longest track record of any blockchain other than Bitcoin, never gone down, the most secure, the most trusted, with the most liquidity.

It also has a multi-year, very, very aggressive roadmap to continue to scale.

Um, that said, their mantra and their approach is to go back to the basics.

The Ethereum Foundation's gonna focus on privacy, and they're gonna focus on censorship resistance, and some of the core principles to make sure that Ethereum is credibly neutral for decades to come.

But what that meant is some of the most critical talent and functions within the Ethereum Foundation were spun out.

Now, during the bear market, how has Sharplink been able to add value to the shareholders? Is it staking DeFi protocols to generate that passive income, so to speak?

Do you think these new organizations, which we have ETH Systems, which was announced this week, ETH Labs and Ethereum Institutional, so these three different organizations, do you think they all kind of like represent the shift in how the ecosystem thinks about growth and like the way it's going to be positioned going forward?

I do.

And I think institutions, and I had spent 20 years at BlackRock, one of the largest financial institutions globally, I know very few things for sure in life.

I know one thing for sure is that they care about three or four characteristics when they move technology.

They want security.

They want trust and liquidity.

And Ethereum has all those things.

So do you think the market is then mispricing Ethereum today or investors are kind of missing the story or it's a mix of both?

How would you weigh that out right now in terms of the biggest overhang for Bitcoin right now?

I think the two biggest overhangs are one, narrative.

You know, I am a huge proponent of Bitcoin and people owning Bitcoin in their portfolios.

This is not an ETH versus Bitcoin story.

And when I was at BlackRock, we launched the largest Bitcoin ETF in history called iBit because we had institutions who wanted to own it.

The narrative was that it was digital gold, it was a hedge against inflation, it was a hedge against geopolitical risk.

So, I think the biggest challenge is, it hasn't been behaving that way over the last year or so.

Do you think fintech users would choose stable versus variable yields if they're similar to each other? I mean, I know where I'd go, but what do you think in terms of users?

Why is Ethereum the best way to express the bullish thesis on the three mega trends of perps, tokenization, and stablecoins?

Sure.

So first, the thesis we laid out is that there is an institutional super cycle not coming.

It's here.

And we're not talking about going from the middle innings to the late innings of a technology transformation.

You can make an argument that stable coins are probably in the third inning.

They're the first and most successful case study on tokenizing.

I'm curious on this offensive, right? When we're talking about capturing a lot of value deals, integrations, partnerships, launches from the perspective of tokenized assets on Ethereum, how do these new non-profits that are almost like auxiliaries to the ethereum foundation how do they contribute to the value capture to the growth of ethereum in this tokenization kind of mega trend

So I wonder, you know, how institutions usually react to Ethereum having this structure with the split between the L1 and L2s, and what questions or concerns they have about it, particularly around things like, you know, fragmentation of liquidity, et cetera.

She...

You know what's quite interesting is it, it's, it's kind of weird to get a question about fragmentation of liquidity when Ethereum is over 50% of liquidity of stable coins, DeFi, and, and tokenized real-world assets.

So, like, the first thing is you have that problem when you're the deepest pool, and I think you're right.

You know, these L2s came into being because Ethereum, uh, at the foundation made a intentional decision that until such time that it had the throughput and the block space, they would cede scaling and, and custom configuration to the L2s.

On the, on the one hand, it's been wildly successful because, again, they're over 50% market share in the things that matter, 10X the next chain.

So, like, that's a good problem to have.

So, you know, do you think of Ethereum Institutional as having that kind of infinite garden culture that the Ethereum Foundation has, or do you plan to try to foster a different type of culture?

So I wonder, you know, how institutions usually react to Ethereum having this structure with the split between the L1 and L2s and what questions or concerns they have about it, particularly around things like, you know, fragmentation of liquidity, etc.? ?

You know what's quite interesting is it's kind of weird to get a question about fragmentation of liquidity when Ethereum is over 50% of liquidity of stablecoins, DeFi, and tokenized real-world assets.

So the first thing is you have that problem when you're the deepest pool.

And I think you're right.

These L2s came into being because Ethereum at the foundation made an intentional decision that until such time that it had the throughput and the block space, they would seed scaling and custom configuration to the L2s.

On the one hand, it's been wildly successful because, again, they're over 50% market share in the things that matter, 10x the next chain.

So that's a good problem to have.

So, you know, do you think of Ethereum institutional as having that kind of infinite garden culture that the Ethereum Foundation has? Or do you plan to try to foster a different type of culture?

... make them feel good about their investment?

Sure.

I think there's a divergence happening right now, which is short-term price consolidation.

I think poor messaging that's come out in the Ethereum ecosystem.

At the same time, there are two things to be massively bullish on.

First of all, crypto adoption by the largest institutions in the world has never been stronger, including by your parent company, Bullish, making a bet on tokenization.

Um, you see likes of BlackRock now participating in DeFi.

... what's behind that?

you know ethereum is prioritizing security how much of the tokenized assets that are coming on chain are coming to ethereum for a lot of transactions per second and then therefore you know playing into this you know very high activity thesis uh that ultimately you know we talked about is is flowing into eth the asset

Yeah, I'll answer that in two ways.

And again, I want to be the most positive person in this ecosystem.

I believe there are going to be a lot of survivors.

Solana is doing a remarkable job focused on a very narrow use case of high frequency trading.

I think if you look at where the real money is, look at the largest asset managers in the world.

the Vanguards, the JP Morgans, the Black Rocks, the Franklin Templetons, the amount of assets that they're going to be tokenizing and the transactions they're doing is not high frequency, but when they're on tokenized rails, Just take a step back.

What is Joseph Shalom's view on maximizing ETH per share for asset owners?

Mm

... a large institution or even a retail investor, you often want to own it in a different wrapper, and you can own it by just buying our stock.

And then what we do is we stake it, but because we have what we think of as long-term or permanent capital, which most of crypto is starved for, we can actually make that ETH productive on a multi-year basis.

And we started with simple staking.

We participate in liquid staking protocols, but we've also been allocating capital into the DeFi space, where we're able to earn a staking premium because we're giving term structure and duration that's just missing in the crypto ecosystem.

You could also buy an ETF, including the ETFs that my team launched when I was at BlackRock, but the ETFs have a structural disadvantage.

Even when they can stake, they're only staking somewhere between 60 and 80% because Ether has a staking and unstaking queue.

With AI integration, especially with something like this one, uh, do you think that crypto's gonna play a role into this if someone like a, like a Higgs Field eventually tokenized their credits?

So take us through that thesis and how integral the Clarity Act is eventually going to be once it reaches passage.

So I think it's really important.

It passed the Senate Banking Committee yesterday.

There's a reconciliation that needs to happen and a vote hopefully over the next several weeks.

But its intention is to take both the crypto industry and the market structure from what's a speculatory regulatory gray zone to basically crypto rails will become a recognized financial infrastructure layer, not just for crypto and all of finance.

And if you take a step back, What it's really going to do is take us from an era of crypto enforcement to an era of crypto integration and innovation.

And Joseph when you look at this what's the next potential hurdle here are there hurdles left in fact or do you expect this to just breeze through until passage.

No, I think there are a bunch of pending amendments, including some Democratic senators who are looking for some ethics language vis-a-vis government officials and the Trump administration.

We're one of the biggest supporters of this ecosystem.

Well, the first thing is our goal is to make our Eth as productive as possible, and Eth is different than Bitcoin.

It's actually natively productive.

You can stake it in the ecosystem, earn the Ethereum staking rate without having to do financial engineering in a public company.

So that, that's the first.

The second thing is if you own Eth on behalf of investors, you actually should be making it productive, and we've been staking nearly 100% from day one.

But the interesting thing is if you own permanent capital, you could do something that has never been done in crypto before.Bring permanent capital and TVL to protocols who meet institutional standards.

Are you saying that you think stable coins will outperform the, the Bitcoin payment solutions? Maybe, maybe the customers are gonna choose stable coins over Bitcoin?

Yeah, please, if you can.

Sure.

So when I said that crypto is usually filled with short-term interest in capital, that's very different than traditional finance.

You do have short-term speculators and buyers, but in traditional finance, you have people who take their capital and they deploy it for multi-year periods.

So let me give you a great example.

In any other market other than crypto, there's something called term structure.

Yeah.

Not asking for price predictions, but do you see crypto rebounding maybe later this year or next year, things like that?

So what would you like to see Ethereum support in terms of making DeFi better or what problems about DeFi do you feel like Ethereum needs to resolve?

Well, I think the first thing is I'm focused on institutional.

And if you think about what institutions really care about to come on chain, I think they've given up on permissioned blockchains.

Like, let's just put a pin in that.

We don't want to use that word anymore.

But they don't fully understand permissionless unless there are confidentiality and privacy.

And whether you talk about DeFi or just Ethereum mainnet, I think there's incredible work happening at the Ethereum Foundation.

Like, I'm just curious, you know, what are you hearing from institutional players when they're talking, when they're looking at dads? Like, how are they differentiating between different dads? Just like what is the conversation that you are, you know, having with with different institutions?