Marine l MC² Finance

I just witnessed a rare civilisational-level conversation. @VitalikButerin builds Ethereum. @balajis predicts the collapse of old paradigms. These are 10 predictions they made. A 🧵:

@James_of_Arc Let’s gooo!!!

ANNOUNCEMENT Ârc MONTENEGRO April 3 - May 29. The exact private town & hotel Zuzalu took place. You will receive an invitation directly from me with the password to access information on this immersive experience. Want in? You will need an existing member of Ârc to vouch for you. These are going to be the best months of our lives. See you there. James of Ârc

pov: your product guy says "the UI is perfect. The user... needs more training".

We all know that coinbase backed Base network has always branded itself as “a bridge, not an island.” so when it launched in 2023 Jesse Pollak resisted the obvious play: issuing a token. I still remember that the focus was on throughput (sub-second, sub-cent transactions) and building trust under Ethereum’s scaling umbrella and honestly that discipline paid off. Base hit major milestones in under two years even reaching Vitalik’s “Stage 1” rollup decentralization benchmark but now on stage at BaseCamp in Vermont, Pollak hinted the team is “beginning to explore” a native token. I also want to point out that the timing is not random because competitors like Kraken’s Ink network have already announced their own tokens and capital is flowing aggressively into crypto treasuries. One example is that Helius Medical just raised $500 million to buy Solana so it is hard to ignore the gravitational pull of token economics when institutions are wiring billions. The real question is intent. A Base token could strengthen security by decentralizing sequencer operations and rewarding validators. It could also fund the $84 billion “42/42” strategy Coinbase is running with perpetual preferred stock (a move that has helped them acquire 638,985 BTC worth $73.4 billion) but it could just as easily be a toll booth disguised as “community governance.” Tokens are tools not magic beans so if Base can show how it avoids the trap of becoming another extractive tax, it might actually set the standard for Layer 2s in the MiCA era. If not, well, we risk another round of “crypto did it again” headlines.

Last week’s crypto fund flows read like a sitcom rerun. One week it’s +$2.5B inflows the next it’s $352M outflows where trading volumes fell 27% and yet year to date inflows are still $35.2B which is already 4.2% ahead of last year’s pace. Investors are not fleeing the theater but they are just switching seats. The U.S. carried the red ink with $440M while Germany (+$85M) and Hong Kong (+$8M) were quietly buying popcorn. The real drama was Ethereum. It saw $912M drained with U.S. spot ETH ETFs alone losing –$787.6M. Bitcoin (in contrast) strutted in with +$524M still wearing the crown as the “boring but reliable” allocation. Meanwhile Solana posted its 21st straight week of inflows now at $1.16B. XRP added $14.7M extending its streak to $1.22B total. These are not blockbuster numbers but they show sticky conviction and this is a rotation. Ethereum was the darling in August and now investors are hedging back to Bitcoin ahead of September’s Fed decision. If you think this is the end of the bull run, remember: sitcoms get renewed if the ratings hold. Right now crypto’s still above last season’s record high. The only real question is which token becomes the next breakout star.

The EU never misses a chance to turn a sandbox into a huge regulatory lesson & Gemini’s new rollout in Europe proves it again (for the Nth time) Staking ETH and SOL with no minimums and daily rewards should be simple. Instead it comes wrapped in MiCA paperwork and MiFID II oversight. The headline: up to 6% APR on SOL, variable returns on ETH. The fine print is that cold storage segregation, regulated custody, cross-collateral rules, disclosure standards and risk waterfalls buried in documentation thicker than the Bible. Europe’s love for regulation is legendary. Here even staking yields are treated like bank deposits, hedging strategies like weapons of mass destruction and perpetuals like a threat to social order. Yet the paradox is funny. The same EU that ties crypto firms in knots is also handing them legitimacy. Gemini can now offer 100x perpetuals under MiFID II alongside 140 spot pairs, staking, and cross-margin all in one regulated wrapper. That is a state supervised casino with velvet ropes and fire exits checked twice a day. The IPO target of $2.22 billion suggests investors are buying the story. Europe’s obsession with control may actually make Gemini the safest place to gamble on leverage. Over regulated, yes. But in crypto, maybe that’s the sell.

Prediction markets are back in vogue but every comeback needs scrutiny. The money is real this time. Ethereum-native polymarket saw daily volumes topping $10m during the 2024 election where Kalshi cleared more than $1.5b in notional contracts last year across inflation, jobs and fed meetings. Robinhood just plugged football prediction contracts into its trading app & a coinbase backed startup raised $15m to promise “regulated on-chain markets.” But here’s the catch: Volumes concentrate in a handful of events. 80% of polymarket’s traffic in 2024 came from just five contracts: trump vs biden, inflation prints and a couple of geopolitical flashpoints and outside those markets are ghost towns. Without consistent liquidity, spreads widen, prices wobble and the supposed “wisdom of crowds” turns into noise. Regulators are circling too. The CFTC now runs nasdaq’s surveillance stack to sniff out manipulation and the nfl has already warned about integrity risks if prediction markets leak into games without sportsbook level monitoring. Prediction markets are not casinos. They are liquidity experiments. The test is simple...if they can evolve into infrastructure for hedging real risks? If they can or they survive. If not they fade back into hype cycles. Right now they stand on a knife’s edge.

Options expiry weeks are where sentiment becomes math & friday’s $14.6b bitcoin and ether expiry is exactly that. The scale is huge. $11.6b in btc options and $3b in eth which is more than the entire crypto options market was worth in 2020. Today one exchange (deribit) handles 80% of this volume. Just look at the skew. BTC puts between $108k and $112k dominate and calls only light up above $120k that means traders are hedging against pain near spot while only cautiously betting on upside. ETH is more balanced where 393k calls vs 291k puts and key strikes cluster at $3800 and $4000. Why does this matter? Because options show what traders fear not what they tweet. Protection is expensive because uncertainty is expensive and this week’s backdrop is jackson hole. Powell hinted at rate flexibility but liquidity still feels fragile. In 2008 credit default swaps told the real story before equities cracked but in 2025 crypto options might be playing that role. They map the edge of conviction and the cost of survival.

There might not be an alt season anymore and that is not just a catchy line but a structural shift hiding in plain sight. In the old playbook when bitcoin dominance peaked retail rotated into alts & the cycle repeated but 2025 looks nothing like that. Coinshares shows $29.5b in ytd inflows into crypto etps pushing total aum to $221.4b. Ethereum etps had their second largest weekly inflow on record. Solana and XRP followed. This is not degen retail chasing meme coins but this is institutions allocating through regulated wrappers where 83% of institutional investors now say they will increase digital asset allocations this year & 87% want exposure via spot ETPS. Deutsche bank reports retail adoption at 29% in the US and 27% in the uk over just six months....Flows are no longer seasonal but they are constant. This changes the game for builders. The index that tracks “alt season” says we are in bitcoin season & the reality is capital no longer rotates like that but it moves with liquidity, compliance & efficiency. The conclusion is simple. Crypto has matured. Permanent flows. Permanent scrutiny. Permanent opportunity for those building real infra. Alt season is dead & adoption is the new season. Forever.

The Fed just shut down its “novel activities supervision program.” It sounds like red tape removal. In reality, it drops one of the only tools designed to slow banks from rushing into crypto without a seatbelt. The program was born in 2023 after a brutal year: • $2 trillion wiped from crypto market cap. • 9 major bankruptcies. • Stablecoins like UST collapsing from $18B to zero in weeks. It gave the Fed a front-row seat to new bank-crypto touchpoints. Now the Fed says banks “understand the risks.” That is bold. Risk in crypto is not static but it mutates every quarter. Terra was an algorithmic blow-up. FTX was a fraud plus liquidity crisis. USDC’s de-peg was treasury market contagion. Without the extra oversight, banks can: • Custody assets with untested smart contracts. • Facilitate stablecoin flows that can unwind in hours. • Hold volatile tokens that can drop 60% in a month. I am anti-complacency. Traditional bank oversight moves in quarters but crypto moves in minutes so that mismatch is where the real risk lives. History shows: when guardrails vanish, leverage fills the gap and in crypto unwinds travel faster than any memo.

It is absoutely bonkers to me that stablecoins are literally exploding and institutions are swooping in because they cannot afford to be late! In July the sector’s market cap hit $261B which is up 4.87% in a single month. That is 22 straight months of growth which is a streak few asset classes can match and the timing matters too...The GENIUS Act (signed by President Trump) is now law so for the first time the US has a federal framework for stablecoins and regulation has moved from theory to execution. The liquidity picture is shifting fast. Centralized exchanges processed $1.68T in stablecoin pairs last month (that is more than the GDP of Canada in a year) and non-USD stablecoins crossed $1B in market cap for the first time with crypto-fiat pairs reaching $41.7B in volume. This is not just a dollar game anymore. Tron’s grip is remarkable. $81.9B in stablecoins now live on its network over half of all USDT supply. That dominance is all about speed, cost and integrations. The pattern is clear. Stablecoins are evolving into the base layer for global liquidity. The question is no longer whether they will rival traditional rails. It is how quickly they will replace them.

The worst experience I ever had with my bank was when they once froze a $23k transfer because I typed “crypto” in the memo which was absurd for me. There was literally no warning and it tool around 12 calls over three days and eventually, it was “approved.” Today my Bitcoin wallet sent $20k in 8 minutes with six confirmations with no calls and no bank manager and no monday to friday window...all because legacy finance likes to call this “risk” and I hate it. What is actually riskier is: → $11.2T in global bank fines since 2008. → $8T locked in cross-border settlements. → 1.4B people unbanked because they “fail” KYC. Bitcoin does not “approve” anything but it confirms mathematically without any politics and just finality...which is what a medium of exchange should be doing. I know a lot of you here come from the old paradigm but it is about time I nudge you to take the leap from permissioned to permissionless and from oversight to auditability and from “maybe” to “proven.” You do not need to believe in crypto but you should understand what it replaces because while your wire waits on compliance desks millions are settling value in blocks with 0 intermediaries and 0 apologies. The world already moved. Today is a good day to take notice.

The smart money focuses on three things: i) Expected value per trade. ii) Maximum drawdown tolerance. iii) Time to recovery from losses. Everything else is noise.

Jamie Dimon called Bitcoin a fraud and promised to fire any trader who touched it in 2017 when Bitcoin traded near $4,000 and now has completely flipped (irony!) With Bitcoin hovering near $120000 and crypto laws softening in Washington JPMorgan is preparing to lend against it...the move could roll out next year and is huge. Loans backed by Bitcoin and Ethereum (not just ETFs) which is is a $2.3 trillion market with nearly 20 million BTC already mined and trillions in collateral potential. JPMorgan is chasing a client base sitting on hundreds of billions in crypto wealth much of it untapped for credit markets. The bank will likely rely on custodians like Coinbase ane seizing and liquidating Bitcoin from a defaulting borrower is not as simple as repossessing a house so AML and KYC hurdles remain but the Trump administration’s push for lighter regulation and the House passing stablecoin laws now give banks more room to maneuver. Morgan Stanley is eyeing entering crypto trading and Goldman still refuses crypto collateral but every institution knows where this ends: clients holding volatile assets want leverage and Wall Street wants fees. The irony is rich. The same banks that mocked crypto now want to mortgage it because math always wins over ideology. Funny.

Coming from 10years+ TradFI experience let me assure you that they love paperwork which amounts to nothing and very little gets done (Always!). A 50 page strategy deck can take three weeks to draft then take another two weeks for approvals so by the time it reaches the board, the opportunity it was written for is gone. I am so glad crypto did not (and does not) have that luxury. Markets move 5% in an hour and capital clears every 12 seconds where a token launch can raise $10 million in under 24 hours. This forces a very different culture. This is where: -Decisions get made in signal chats. -Roadmaps turn into pull requests. -Treasury approvals happen on-chain. Makerdao’s $8.2 billion treasury voting on every $50,000 spend publicly or Aave signing every transaction above $500,000 with 5 of 9 multi-sig recorded for anyone to see is brilliant. Compare that to tradfi. Blackrock controls $10 trillion & its investment committee meets privately. There are no minutes or no audit trail until regulators ask snd when they do, it costs Bank of America $3.2 billion a year just to reconstruct decision histories. Is crypto chaotic? Sure. But it cuts the dead weight because the layers are built to protect egos (not outcomes) vanish. TradFi, you need to stop importing bureaucracy into a market that clears faster than your email chain so please adopt the tools and adopt the transparency or get priced out by those who do :) Sincerely, Someone who had made IPOs happen (boy that was way worse)!

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I am noticing some real interesting World War III discussions (hypothetical butimportant). Germany’s BTC mines power 5% of global hashrate. Russia adds 11%. Norway, another 2%. Together that is nearly a fifth of Bitcoin’s network. These facilities are not tucked away in basements but they are plugged into national grids, using hydro, wind, and even district heating. One Norwegian town saw power bills jump $300 per household when a single miner left. In Finland Terahash heats 12,000 homes with excess miner heat. Austria uses miners to stabilize renewable-heavy grids. These sites are not just computing warehouses but they are energy infrastructure hiding in plain sight and in war, energy infrastructure is fair game. If conflict spreads, 20% of Bitcoin’s hashrate could vanish. Miners will migrate (likely to El Salvador or Bhutan) where politics welcome them. Bitcoin can withstand market crashes. But missiles are harder to hedge. Even decentralization needs an evacuation plan.

I am about to offend a whole bunch of traders but I am tired of everyone pretending they make $$$ with their fake profit screenshots...it is sad. Most traders lose money but they just do not talk about it. Broker data shows 80% of day traders quit within two years. By year five only 7% are still trading and of those less than 2% consistently make money after fees. Yet thousands keep trading despite years of losses, hoping for a “comeback.” The numbers tell why. Most traders sell winners 50% faster than losers, booking tiny gains while holding sinking trades and they double down on losers to “get back to even.” I personally know people who trade more after a lucky streak confusing a coin flip with skill and proceed to lose more and more money. Active traders underperform indexes by 6.5% annually. In Taiwan retail trading losses equal 2% of GDP every year....imagine. Trading looks like a casino because most act like gamblers. The few who survive act like accountants. They journal every trade and set hard stop-losses to risk only what math allows. Everyone else keeps drawing trendlines until their broker margin calls them into retirement.

Somethng historic just happened. The US House just voted 215–211 to consider three crypto bills. Yesterday, the same vote failed. Thirteen Republicans said no. Today, eight of them said “fine.” even with Trump breathing down their necks, five Republicans still refused mostly over the GENIUS Act where a stablecoin bill that somehow forgot to mention CBDCs. Irony writes itself. Meanwhile, Democrats aren’t thrilled either. They want provisions that address Trump’s potential crypto ties and with the GOP’s razor-thin majority, Republican leadership now needs bipartisan buy-in. The GENIUS Act already flopped once in the Senate. It passed only after tweaks. Expect the same circus in the House. So what’s really at stake? → $150B+ stablecoin market → Legal definitions for tokenized assets → A formal rejection of a digital dollar In other words: the future of American crypto policy is being written by people who still think MetaMask is a Halloween costume. (Somehow, that's an upgrade from last year.)