Ryan Watkins

“There’s our little geopolitical AI expert! Why don’t you come downstairs and tell us more about your equity puts and how the Strait of Hormuz will lead to a global famine?”

A thread on why *insert incumbent broker / exchange will not be able to start innovating like prime steve jobs and outcompete Hyperliquid. The Incompatability Problem:

Huge congratulations to TradeXYZ and S&P for this historic partnership. I'm honored that these teams choose to build on Hyperliquid. Seeing official S&P500 perpetual futures launch exclusively on Hyperliquid is a validation of everyone's past years of hard work: global access to decentralized finance, perpetual futures as 24/7 price discovery, and Hyperliquid upgrading the existing financial stack to house all of finance. The S&P500 is synonymous with "the market," a single number that captures the essence of the largest economy in the world. Looking forward to tracking the world's most important financial gauge 24/7 on the most liquid permissionless markets.

@notthreadguy Promises kept

@RyanWatkins_ YEOOO it dropped lfg

Perps eating global financial markets is the highest conviction thesis I’ve had in my 4 years since starting Syncracy. If we’re right, the sector could produce $350B+ in value over the next 5 years, with the winning chain becoming one of the largest platforms in global finance. As shared in our OG Hyperliquid thesis released over a year ago, we believe $HYPE is the fastest horse in this race. While many skeptics view platforms like Hyperliquid as products of regulatory arbitrage, over time we believe they will come to be understood as a fundamental transformation of the global trading stack. What was once a fragmented world of brokers, exchanges, clearinghouses, among other intermediaries, is giving way to integrated trading systems that are continuously margined, atomically settled, globally accessible, and permissionless to build on. The case isn’t just theoretical as early signs of disruption are already visible in the data. In the early months of perps’ “real world asset” expansion they’re already impacting global financial markets — most recently functioning as a price discovery engine on weekends for oil during the Iran conflict. We believe this is only the beginning and that perps will absorb an increasing share of leveraged directional trading that today lives in retail options, CFDs, and fixed-tenor futures. Even low single-digit penetration of these markets could produce dramatic outcomes for the sector. In parallel, it remains under-appreciated how quickly DEXs like Hyperliquid have emerged as leaders in equity and commodity perps. Should DEXs continue scaling these markets, it will accelerate their share gains from the likes of Binance and Coinbase while also positioning them to challenge legacy derivatives venues such as CME, who will struggle to compete due to regulatory and architectural incompatibilities. Finally, as decentralized venues lead the growth of perps, we believe they will also expand into adjacent categories. Perps are the hardest product to nail on blockchains and once a blockchain can successfully host perps it naturally starts to aggregate other crypto use cases as a byproduct. We are already seeing early evidence of this with Hyperliquid’s expansion into spot trading and stablecoins, and soon prediction markets and options. It’s in this sense that perpetual DEXs are also Trojan horses for the financial platform of the future. —— Enjoyed writing this one with @defi_monk who was the first sell-side analyst to cover Hyperliquid in summer 2024 and among the leading thinkers on the sector. Hope you all enjoy what is a very detailed and data-driven piece that was a long time in the making.

“You’ve been vibe coding for 3 months. What have you built so far Mr Vibes?”

Yall are really turning AI into hustle porn 2.0. It’s like LinkedIn slop but with an undercurrent of “normies are fucked” doomerism. Just incredible amounts of cringe VC groupthink on here. Imagine being bullish AI without being a dweeb 🤔

“Dude I have 10 agents running while I sleep. No one is prepared for AGI in 2 years man.” “So what are you building?” “Bro all my smartest friends are vibe coding until 3am every night. It’s all about agency. Intelligence is a commodity man.” “So what are you building?” “Do you even study exponentials? Have you seen the latest METR chart? You’re going to be stuck in the permanent underclass bro.” “So what are you building?” “Did you even setup OpenClaw? I’m maxing out my token budget everyday man.” “So what are you building?” “I promise you I’m 10x more productive bro! You just don’t understand! Please bro just…. I know you use this stuff everyday too, but you must not be prompting it right! Please broo…”

While there are many theoretical reasons why “agents will prefer stablecoins” the reality is that for the foreseeable future, agents will be directed by humans who have little preference on payment rails and will go with whatever is the default. This is great if that default is stablecoins, but in the interim, that is not a given as every payments company on earth is racing to build interfaces for agents that may not involve stablecoins at all. So when you boil it down, the bet on agents using blockchains is really just a bet on stablecoins winning out as payment rails over the coming years. That’s an easy bet for me to make post-GENIUS act, but it’s a different one from the sci-fi-esque 24/7 autonomous agent-to-agent economy that i see people getting excited about. That too will come with enough time. The good thing is that the early experimentation in this area will likely be grassroots and take place on public blockchains, which continue to provide the best sandbox for building frontier financial protocols.

who’s gonna be the Kanye of software?

As sovereign agents self-improve and replicate, they open wallets, pay for services using @x402, hold stablecoins, and launch businesses on Solana.

Now Twitter’s head of product is contradicting himself. Will just have to wait until the product launch to see what they actually put out. Regardless point still stands about institutions positioning.

In the past week alone we’ve had Blackrock, Apollo, and Citadel all buy DeFi tokens, and Twitter announce they’ll soon introduce crypto trading to their 550M MAUs. Starting to feel like institutions are positioning ahead of CLARITY.

“But bro you’re cherry picking the jobs least prone to disruption. What about all the entry level white collar jobs…” I know. The point is that it’s possible to be bullish AI without sounding like a schizophrenic baboon.

“Normies are so cooked man. They have no idea what’s happening in AI. You need to start vibe coding and hypergambling ASAP! You’re running out of time to escape the permanent underclass.” “Dude I’m a dentist and my gf is a real estate agent. What the fuck are you talking about?”

Anyways the reason why this is exciting is not because it will directly lead to more buybacks (it will indirectly). It’s a subsidy for traders who will now pay less funding on positions. Should increase open interest.

For context if Hyperliquid got a similar deal, it would be an incremental $150M+. Not as significant an increase relatively for HYPE at is LIT, but obviously would be nice to have.

Not sure the details here, but if the deal resembles the one with Coinbase, could be an incremental $30M - $40M in annual revenue for Lighter. Will of course linearly track the growth of deposits on the platform from here too.