Yield is the Meta I Chris Yin

[Music] And for this one, I'd like to bring on Chris from Plume to tell you all about Yield as a new meta. Give him a big round of applause.

Yes. All right. Good to see everybody. Sorry I'm uh a little bit late. I think I was supposed to be on earlier and of course I showed up late, but here we are.

So anyway, let's get to it and I'll rip through this thing. If I'm talking too fast, just let me know. But anyway, really quick. My name is Chris. I'm the co-founder and CEO of Plume.

I think I see Alp here. So, good to see Alp um who's on our team. But cool. Let's get started. Let's talk a little bit about yield and what's going on here.

Uh this is the right thing. Yeah. Okay, there we go. All right. So, again, I run a a company called Plume.

We we build a blockchain focus on RWAs. Um and uh I'll get more into that in a second, but maybe to start with this, right? Yield. It's a new meta, right? And so, the the idea is pretty simple, right?

Right. I think if we go back and people here last cycle probably remember this, right? This was um a thing called loot, right? And what happened at the time was we had a bunch of people paying uh a lot of money to own these little squares, right? With words on them, right?

That was kind of the starting point. And then of course we had the NFT craze. We're buying ether rocks and And then of course Jaw rules doing some nonsense with the with with NFTs too. So like this is the last cycle, right? And what that led to was this which everyone remembers this, right?

Which is you have these gas fees here that are nuts and expensive. Everyone's trading on on ETH mainet right and this is the basis of the of the last bull run kind of where things came from right and what ultimately kicked all this off was we had this tweet from Saka right uh for Saloon and then quickly after it became Salunx right and the idea was pretty simple at the time right which was ETH1 is clogged right and you have all these Ethereum killers that come up and it becomes this kind of alt L1 story right so you have these three things that come up so Lunax right and you know Kobe wrote about all this right somehow Kathy Wood gets involved and puts together this deck, right? And talks about it over here. We have Selen Avac, right? Um and then uh again, of course, one of the great posters, Kyle Davies, talks about uh the ability to choose all of these things and just about in all of this, right?

So, that's kind of the old that's kind of like where we got and how we got here, right? What was sort of the trade of last cycle and how we thought about it, right? Now, whether it's not Eve kill or not is a different question, but more about articulating what was the kind of story last cycle and what were the things that people were betting on, right? Now, if we fast forward to today, it's very clear, right? that the story that people are focused on right now is around yield, right?

Stable farming. I feel like I see a tweet every single day about here are the best stable farms, here's this and here's that, right? Everyone's talking about stable farming, what to do there, not realizing that most stable farms are still the same thing. It's still points, but anyway, that's what people want at least. So, we're transitioning away from that, right?

And that means focus on yield. Now, if we look at this again, right, if we look at yield, this is not a new idea either. It's not a new thing this cycle. I think if people again last cycle, you might remember this, you might remember this uh this screenshot, right? um where we've got uh you know these savage API numbers right and uh and like the thing that people forgot about this at the time or people remember now looking at it was that despite having this much APY right the chart ultimately looks something like this you know and so sure you're getting a 60 you know 59,000% API or whatever but it's still a L right you're still losing a bunch of money and if you can guess which chart that is um then shout out to you but anyway so that's the uh that's the idea kind of where we are with this, right?

And so the pivot here has been uh shifting to not just yield but this word real yield right and what's coming on behind this thing. And so that's kind of where we are in the premise of where we are today, which is the focus for this cycle very clearly. If we've solved the Alt L1 problem, right? And the sort of ETH scaling problem, which really is the L2 story, right? We've seen everyone doing all different kinds of L2s and everything.

Now I think largely bridging is like a lot better. Moving things around is all good blah blah blah. Now the question is where does real yield come from and how do we grow and build things from there, right? And so if we look at this, right, in my view there's sort of three different ways to look at yield, right? And three different things that kind of go into it.

One is liquidity, right? How would you bet on yield and how would you get exposure other things right going down KY I don't want to bet on one I want to bet on all of them right so number one is liquidity what brings in liquidity number two is what creates utility number three is what captures the value right so if you look at these three things we can go into each of them right there's no better way of talking about liquidity right than stable coins right stable coins come in it brings money and it does all the stuff to actually make the rest of the markets work and if you look at stable coins right the reason why it works is because a stable coin today is built off the back or actually I guess this is it right here's a chart of stablecoin growth over time you See, it's up and to the right, right? And everyone now everyone's doing stable coins. Every institution is launching a new one. Blah blah blah.

Right now, the reason why it's popular, right, and money is flowing in is because of this guy, right? Because he refuses to cut rates, right? Uh so hopefully that changes, but at least that means in the last couple years we've had this 5% T bill, right? Or 46 or 43 or whatever, right? Which means by holding money in these quote unquote stable coins, you can earn a risk-free yield.

And that's been the basis of bringing a lot of stuff on chain both uh in the in the US but also all over the world right so people are now putting money here right and earning yield against it right that's the reason so that's the first thing you put money to here because you're providing liquidity you get a yield as a result right and that's seen a tremendous explosion in a bunch of stuff right and so now you have this you have like stable coin market maps now which I think is kind of a nutty thing to even talk about right and more importantly you know people are talking about like how these businesses are super profitable we can see here that only fans is the only thing that's like you know it's it's tether's better than only fans I guess or whatever Right. Um and so you can see here, this is the Athena um uh TVL chart. So you can see again, you know, when you're thinking about yield, you're thinking about tokens that sort of reflect yield and give out yield, right? They're up into the right, right? And things are going really well.

They've crossed nine billion. And so like it's very clear that at least this cycle, one of the things that matters a lot is yield. And how do you express that in the form of yield bearing stable coins, right? This is the reason why, right? Because of these yields here, right?

And even things that don't have any yield are still pumping, right? So, uh, so, uh, USDC, right, has also gone out and done really well in the last couple days. And so, like, again, if you're thinking about like how to bet on a yield concept or anything, liquidity and stable coins and everything is obviously one dimension of it, right? This is the Athena price. It's obviously gone well in the recent times, right?

Anyway, that's the first one. Number two is utility, right? Utility is very simple. It's meaning you can do something with it, right? And I think again, one thing everyone talks about this cycle, I'm sure you guys familiar with, is this, right?

This is called Pendle, right? And it allows you to trade yields, right? And so, you go the PTYT stuff, right? you can trade yields and speculate on stuff and blah blah blah and a lot of activity has come this way which means they're also generating a ton of fees which they can pass back to users right so if you're going to bet on fees again bet on yield again you have to go to somewhere where there is utility right because utility generates activity activity generates fees that gets passed back to users and those tokens go up right and so again if you look at pendles it's also gone through the roof right um and so these things have gone very very well uh and mapped together right and even simple things like this this is fromo right used to be more focused on the first point which is the T bill story and bringing liquidity in. Now they've kind of piv uh positioned themselves and transitioned more to do story around this this like tokenized equities thing, right?

Bringing that onchain, let people trade equities, right? Whether you like that or not is a different question, but it's at least coming in, right? So that's the second thing. The third piece is value capture, right? And I found very few good tweets about to talk about this, but we can just show again like, you know, I think at least, you know, if you're on Twitter, you always see the value capture story.

One talks about value capture this, value capture that. Turns out most of it is nonsense. But the idea that at least something is bringing in money, right? And then uh capturing a piece and packing passing it back to the user is at least better than most things that don't do that, right? So at least that's a story today.

And so here's another tweet, right? That shows kind of like where value capture flows to, right? And so ostensibly the base layer is where most things get uh the capture the value and captures activity and pass it to. So if you want to bet on value capture, the base layer is probably a ghost place to go. Although if you look at a chart today, more and more that's learned to the application level.

So both things are fine. But finding places where the value is captured in a yield story, right, is another place to kind of spend your time, right? So if you want to think about how do you get exposure to the yield story this cycle, right? You look across these three dimensions, right? So maybe really quick, I've been setting a lot of up here, right?

Maybe to start off with who I are and kind of what we do here, right? So again, I run a company called Plume. Um we uh we build a blockchain focused on uh real world assets in RWS, right? And bringing things on chain. There's three uh these three Asian people.

We're the founders. I'm one of them. Um and uh you know we've raised you know 30 million bucks a day from a bunch of folks on Galaxy Superscript YZI Apollo blah blah blah right and so you know for us I think we launched a token somewhat recently so of course you know not financial advice but feel free um and then um you know uh it sort of culminated on us going to the White House meeting the president doing all the DC stuff as I'm sure a bunch of people here are doing right because that's apparently what you're supposed to do nowadays um and it did lead to us getting featured in the White House digital assets report as well right and so we've spent a lot of time thinking about what's happening this cycle, what's going to bring in money, what's going to grow the ecosystem, what's going to push things to the next level, right? Um, and so when we look at this again, now coming back to the original point, right? Oh, sorry, forgot about this, right?

More shilling of plume, but just to say, right, we've got a big ecosystem, bunch of projects, we've got a bunch of assets, a bunch of capital, a bunch of users, a bunch of Twitter followers. Great. Right. So, coming back to it now. Um, yeah, I guess we have a bunch of stuff here.

Sorry, I think this one's a little bit a little bit out of out of out of position. But basically what we have on what we have on plume today when people talk about tokenized assets thing a lot of people talk about financial instruments and only that and mostly it's not even financial it's just tea bills. If you look across most chains all of the tokenized assets is like 90% T bills. So very fun exciting stuff right for us we focus on other things. They've got collectibles alternative assets we got financials.

I'll talk more about what those things are in a second and how that gets expressed on plume today. All right. Now, if we go back to the original point, right, three things around yield and three ways to articulate the story, three ways to think about this, right? You've got yield, value capture, and utility or sorry, liquidity, utility, and value capture, right? Going into it again, starting with liquidity, right?

The number one thing around liquidity and going to the stable coin. So, plume, right? How does this all fit and come back to us? Of course, because that's what this is all about, right? So, number one, we've got our own stable coin called PUSD.

We we take in the stables from there, right? We deposit it into different yield bearing assets. We take the yield, pass it back to the user, right? It's a very simple way to articulate and think about this thing, right? And so that's because in we launched our mainet about two months ago.

We've seen TVL really go up as a result, right? And so that's kind of the starting point, right? When you provide yield when you do this, people come and use the ecosystem. That's the first thing, right? Now, what do you actually do when you talk about using the ecosystem, right?

Number one is looking at well people you have to have people actually holding things to use things, right? So this is something called Bidd, right? Um so people might know the Bidd, right? Which is the uh the T- bill fund now, right? Big number, right?

Two and a half billion. I think everyone's excited about that. The thing that people don't look at too much is this, right? It's got 87 holders today, right? Of which, you know, 79 are the same people, right?

Um, so anyway, just to say it's great. I'm glad there's money here. I'm not I'm not doing anything at all, but just to say it's I I wouldn't call this utility when you have 79 87 holders, right? So the distinction is we look at Plume, right? We launched again not that long ago.

It's it's been about two months now. Uh when we came out, we flipped ETH to become the the largest chain RW holders now. So people actually holding tokenized assets and doing things with them, right? Right? So we got over 178,000 E soul and then more than E soul combined, right?

So I think that's the starting point. If you want to talk about utility and doing things with these assets, you have to have first the people holding these assets, right? That's number one, right? Then number two is like I give you a couple examples of like what you can do with these things, right? Again, we have financial instruments and all the boring stuff, but we also have got more esoteric things that are interesting, right?

So for example, this is thing called mineral vault. It's one of our protocols, right? What they do is they own um these these are called oil rigs, right? And this is about my level of knowledge in oil rigs. And so if anyone feels feel free to call me out, but my understanding of these things is very simple, right?

They produce money, right? They sit there, right? In Texas, they call it mailbox money because if you own one or have a share in one just spits off cash, right? Because you can you can lease this to Exxon or whatever and they will pay you a base rate but also some royalty on top, right? So it's called mineral rights, right?

And so what we've done is we put this on chain, right? This is not this thing that people normally talk about, right? But you can get between a 15 to 20% APY on this thing, right? That's fairly safe and stable because it's a bunch of them. You don't just own one.

You own 3,000 at a time, right? And from this, right, you can get a really solid APY, right? So, as a result, right, what we did is we put this on chain, right? And within two months, right, they've got about 600,000 holders of these oil wells all over the world today, or I guess in in America that hold uh and earn royalties from this. And on Plume today in two months, and now they've got 80,000 of those.

So now a meaningful part of their holder base is onchain, right? So now they begin to think about how do you actually put this on chain? How do you think about the user base? How do you communicate with them? How do you formulate new products for this audience?

Because the onchain experience is different than doing things in the real world, right? And so that's a starting point, right? If you want to make things useful, they have to be interesting enough to actually do things, right? I can buy T bills at Fidelity today, right? So it turns out most people don't buy T bills on chain, right?

So that's number one. Number two is this, right? This is another example. This is called a tuk tuk, right? If you guys are from Southeast Asia or anything about this, these are Ubers in in Thailand basically, right?

Um and what you can do, same thing is you can just finance a fleet of these things, right? And so what you can do is put this on chain, you finance it, and then you get a share of their their rides the whole way through, right? So you can see here, you know, we financed thing, we did the whole campaign around this, right? Right? They did a bunch of plume branded tuk tuks, right?

And then in a couple days, you know, we, you know, they raise a bunch of money. We're able to finance a whole fleet of these things, right? And now people are earning money from these tuk tuks as well, right? So again, another thing that you can do with this, right? And because of this, right, it's utility.

People use this thing. We generate fees and earn fees. We can pass that back to users, right? And the last thing is again looping, right? Everyone loves to talk about looping, right?

Turns out most looping is right? Uh when it comes to RWS, crypto native looping actually works quite well, right? But like take this as an example, right? And again, not to knock anybody, but like if you look at B, right? I talk about this looping story with Oiler and Avac, right?

Again, it's a great thing. Go to Oiler today, right? Unfortunately, the one thing you look at is utilization, right? It's not very high, right? So, that's number one, right?

No one is using it, right? That to me is the key thing that matters around making this stuff matter, right? Look at this another one. Drift institutional. Again, great product, great people.

Not knocking anybody here, right? But they did this whole announcement around this type of stuff, right? Paul is one of our investors and they talk about this in the blog post, right? Talking about looping, right? This last thing, Camino collabor leverage looping, right?

Again, let's go to Camino and take a look at this thing, right? You'd turn balls 0%, right? So again, like, you know, it's it's quite early for these things still, right? And you have to change the nature of these things to make them useful, right? Turns out looping against an asset that doesn't return the money for 90 days, it's quite hard to tell if it's actually in profit or not, right?

So, um, that's the thing. And so, we look at Plume today, we've built these markets. We have N alpha, which is a collection of many things and TBL and basis, which is our basis trade product. Excuse me. A lot of these different things.

Today, we've got over 40 million bucks of stuff looping, and RV is looping on plume today, right? So it's a little bit different and a different story, but you have to change these things to make them actually useful, right? And the last thing is value capture, right? Here's a here's a comment from a blog I wrote which is basically just saying, you know, across all these things, we take fees, we take sequencer fees, we pass it back to users and holders of plume, right? And again, so that's kind of the story across this whole thing, right?

And the reason why this all works today and why this happens is because this, right, we focus on making things look and feel more like crypto. These RWAs should feel like crypto just like the stable coin is today, right? the stable coin people forget is an RBA because the stable coin is just crypto, right? It's permissionless, it's composable, all these things versus these other products, right? I can ask people in the room, how many people are holding these assets today, right?

And the room would stay the same, right? If I said if I told people raise their hand, it would be the same position. Not many people hold these things, right? So that's the comment and that's kind of like the style here, right? And it's because that instead of us building this, right, which is another version of Black Rockck on chain, we're really focused more on this, right?

Which is focused more on this bottoms up story, right? Focus on the individual user, focus on the audience, right? focus more on doing what we think more of like a Robin 2 although I can't use this analogy because now they have their own chain as well but um the idea here is that instead of us you know going after you know like Melvin right who was trying to bet against GameStop and all this stuff last time ultimately right a bunch of the people came together bankrupted them and like made it a thing right so the retail user the bottomup user is the one changing the story and taking control here so for us we focus on the exact same type of thing here but for the crypto markets right when we talk about RWA and so instead of this right it really should feel feel more like this, right? It's really more of a fun thing where you can experience a lot of different things. You can buy tuk tuks, you can get oil, you can do fin, you can do whatever you want versus, you know, again this, right?

A more u classic version of things, right? And look, I didn't like Wall Street one very much. So two doesn't feel much better, right? So that's the idea, right? So if you're going to go back to this, right?

In my opinion, the way to do this, you got to think about base for cryptonatives and that's how you make this thing work. It's about earning, it's trading, expecting, it's fitting these things into use cases that we already do today versus trying to bring these new things and that's how you get adoption. And if you go back to this example like mineral vault, by doing this and actually finding real usage and real numbers for them, they begin to change how they think about what they're doing on chain and want to formulate their business more for the onchain world versus just carbon copy than what they have today and trying to put it on chain, right? So anyway, these are a bunch of the use case and things you can do today, right? And the idea is instead of this, right, you want this, right?

So long story short, right? If you think about like what's the cycle and what people are talking about this this cycle around, it's about yield, right? And these are three dimensions of yield. So you can find things that express those ideas across each of them or you can find something that has all of them at once like bloom. So anyway, thanks again for taking the time and listening today.

Um and I'll catch youall later. [Music]