ROLLUP: 2025 Crypto Meta & Predictions | ETH Roadmap Updates | DEX's Hit All Time High | Vitalik Adopts Moo Deng?
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Bankless Nation, welcome to the first Bankless Weekly Roll-Up of the Year of Our Lord 2025. David, we're here. We made it. It's been a long time since I've seen you, man. I think this is in our four years of doing this episode, entering the fifth year of this podcast, I think the last two weeks have probably been the longest that we haven't even interacted over Zoom virtually anywhere. I think so.

I think we sent each other four or five messages in Discord over the last three weeks. I've been in Argentina and then the holiday break, went straight into the New Year's break. This is the longest that we have ever...

Just been chill. I feel like that's good for our mental health. Really good. It's been really good. How are you? How are you, bro? I took kind of a screen break. So I kind of like disconnected. And then I just like today, I kind of redownloaded, you know, fired up the OS again. And I got up to speed on crypto. And we're here to bring it up. You gotta take a break from time to time. All right? Because like, yeah, it felt really nice. Felt very grounded. I felt more human again. Yeah. You know...

I think that we just spend so much time looking at charts on screens, like absorbing information. And it felt good just to be like normal. Yes. And just to be still. That was the most normal I have ever felt since getting into crypto.

Three weeks while I was out, I put a one-minute-long time constraint on Twitter on my phone. And one minute is just long enough. If somebody sends you a tweet, you can open up Twitter and look at the tweet. But then one minute later, if you start scrolling, one minute later, okay, your time's up. Time's up. You're done for the day. And that was really nice. So if you go to my Twitter feed right now, there's just...

Seven retweets over the last three weeks and zero tweets. It's very sparse. It's the first time I've ever done that. I can't believe you're allowed to do that, apparently. You can get off screens for a little bit in crypto. But now we're back.

Taking the pain so you don't have to be on Twitter all the time, Bankless listener. We got a really busy week, actually. We're going to start with the curated list of our 10 favorite predictions for 2025 because everyone wants to know what's going to happen this year. We got 10 fantastic things to look forward to. What else we got?

The crypto AI sector did not get the memo of the holiday break season. Many tokens are up 3x from their pre-Christmas prices, which is extremely recent. This is like 10 days ago. So that's pretty nuts. And then also some less fun news. The IRS is about to force all DeFi brokers to KYC their users, which, as we know, doesn't make any sense in the crypto world. So we're going to talk about this. Who is actually viewed as a DeFi broker and what might they need to do?

Also, Blobs became the top ETH burners, which is pretty impressive over a seven-day time period. DEXs hit their record highs in December. DoQuan is about to be sent back to the U.S., into U.S. hands. And Vitalik Buterin adopted MuDang, you know, the cute little hippo? What a headline. That's Vitalik's now. Vitalik owns that, I guess. Vitalik doesn't know.

He's supporting him. Before we get into all that news and more, a message from our friends and sponsors and our lawyers, the Rodman Law Group, our bankless lawyers, want you to know that they are the best damn lawyers in crypto. And I believe this sentence wholeheartedly, best damn lawyers. Dave Rodman and Rodman Law are crypto native lawyers. I was hanging out

with Dave Rodman at DEVCON in Bangkok, walking around the venue while he was rocking the Tornado Cash t-shirt, which I think is pretty damn based.

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Even if you don't think you need a crypto lawyer, you actually do need a crypto lawyer. You need a crypto lawyer before you need a crypto lawyer. Yes, exactly. All right, David, let's get into markets this week and the price of Bitcoin. So what did it do over the holiday break? Where are we on the week? We are up 1.3% on the week, starting the week at $95,500, ending the week $96,800. So flat, flatty up, flatty with an up bias. Ether,

doing something similar, a little bit more green than Bitcoin this week, started the week at $3,333, up 3.8% on the week to $3,450. Still either kind of slammed down from where it got above 4,000, which makes everyone feel good. Now we're at the bottom end of the 3,000 range, trying to get our head over 3,500.

Okay, let's look at the one month on Ether. Look at this. Do you remember this? It was early December and we were above 4K. And I was thinking, I was thinking December for the holidays, I thought Santa Claus would leave us some all-time highs in the stocking. I thought we'd be closing in on 5K early.

about right now. And then just like none of that materialized. So here's to 2025. Maybe this course cracks in 2025 because the ETH ETF flows have been pretty hot lately. Large. Maybe they are front running some of the price appreciation that we hope to see in ETH. Tell us about those flows. Yeah. So on the December 31st alone,

Ether, the ETFs drove 57 Bitcoin into the ETFs and 10,710 Ether, which is $5.3 million of net inflows into Bitcoin. And Ether had $36 million of net flows into the Ether ETFs. That's on December 31st.

Overall, December was a huge win for the Ether ETFs, just really outpacing Bitcoin, really punching above, way above his weight. And we're finally really getting into some very positive numbers on the Ether ETFs coming in at $2.6 billion in total net inflows.

It was just pretty damn crazy. That's good to see. I mean, all of that happened. I think like it started. I mean, we were negative for most of most of November, weren't we? And then it kind of turned around toward the end of that month. And now it's positive. And now we are way more positive than we've ever been negative. It really it really the momentum changed to really, really fast. It feels nice going into the year. Speaking of ETF. So Bitwise did this cool thing. Bitwise filed for a Bitcoin standard corporate contract.

Bitcoin Standard Corporation's ETF. And really, the incentive here is to incent the stocks of companies that have adopted the Bitcoin standard. So they're creating an ETF, an indicee, that's full of these companies. Look at these companies here. Wow.

All the companies that own, in order to get into this club, get into this ETF, you have to have on your corporate treasury the Bitcoin standard, which they define as holding 1,000 Bitcoin or more. So it's 1,000 Bitcoin times the price of Bitcoin, $100 million or more worth of Bitcoin on the treasury. If you have that on your corporate treasury, then you get into this club, right?

of the Bitcoin standard corporation ETF that Bitwise is going to roll out. Interesting. Yeah. Interesting. And I guess the investment piece is here. What exposure are you getting? You're getting exposure to companies that put Bitcoin on the balance sheet. But the companies could be anything. It could be a tech company. It could be a bank. It totally could. So it's weird. It's like... That's kind of odd. You're kind of getting exposure to companies led by laser eyes. Bitcoin bullies.

It's kind of that, right? Well, I don't know. You know the theory that if the CEO of the company, the co-founder of the company starts lifting, doing squats and bench presses and stuff, they get gym fit, then that's bullish. Or bald is bullish, right? And people have run correlations with this. Maybe it's something like that. You have laser eyes, you can see the future. I don't hate it. You're stacking Bitcoin. Anyway, this club right now is composed of, you can see, it's about...

would be about 22 companies right now with MicroStrategy at the top. No one can touch MicroStrategy. 444,000 Bitcoin. Okay. And then assortment of other companies that Coinbase, of course, has some Bitcoin on treasury, but other companies like Tesla, you might recognize Galaxy Digital, of course. Some of these are crypto companies, some aren't. Semler Scientific, I don't know who they are, but

Again, it's like this whole own Bitcoin in your corporate treasury kind of incentive meme plus an investment thesis. Kind of neat. Interesting. I will love to see how this tracks over the year and how Bitcoin-pilled company leaders compare to non-Bitcoin-pilled company leaders, because I guess that's the signal that we're going to get from that. As usual, I'd just rather own Bitcoin than these companies. Yeah, right. Exactly. To each their own. Where are we at on the ratio, David? Yeah.

Ratio is we are kind of still in no man's land. We are higher than the lows. We are not higher than the recent highs. We are at 0.055. So still kind of waiting for some action on the ratio. Really no signal here. Total crypto market cap. We are above 3.5 trillion, coming in at 3.57 trillion dollars. Still looking at that 4 trillion dollar number. Yeah, that was nice hitting that 4 trillion briefly. Okay, tell me about...

Well, no. I think we did. I think we got 3.9. 3.9. Yeah, pretty close. We didn't hit $4 trillion. So we got that to look forward to. I'm sure it's coming anytime, maybe in January. All right. Tell me about some movers of the week that I missed over the holidays. This is brought to you by our friends over at Uniswap with a weekly reminder. Go get the Uniswap wallet. It just pops out in your browser. It's a fantastic extension. Okay. What were the tokens that you were looking at on the week?

The two big movers of the week. And these are the top two movers. Usually I go to CoinGecko, sort by seven day and kind of like pick out a collection of the quality tokens that aren't like flukes. But these are actually the number one and number two seven day movers of the week. Coming in at number one, AI16Z up 150%.

on the week. - Wow. - $2 billion market cap, followed by virtuals up 60% on the week at a $4.6 billion market cap. AI16Z is the token associated with the ELISA framework, which is really kind of leading the charge in producing AI agents.

But virtuals is got this AI agent launchpad to make it super easy to launch your AI agent. This is where AIXBT comes from. This one's on base. AI16Z is on Solana. And so just it was the last 10 days. In addition to the 10 days before that and the 10 days before that was driven by AI token movement. It's super impressive. And this at a time when the rest of the crypto market was kind of flat. Yeah.

This is over Christmas. Imagine how infuriating that is in which like the biggest movers of the week of the meta is happening when you're in the holidays. And I am, I am just gone. I'm not paying attention. Hey, AI agents don't celebrate. I found out about these tokens like yesterday. These? No, you knew about these. Come on. I knew about them, but I didn't know that they had moved to 3x their prices since like December 22nd.

It's super impressive. And this is maybe gets into a prediction that we'll talk about what are AI agents and this whole narrative going to do in 2025. But did you listen to that episode we did with Jensen while you were out from Virtual's Protocol? I did. I did listen to that one. Yeah. Did you hear how he described virtual space as like a digital state for AI agents, right? When I heard that line, I was like, oh, Ryan, that nerd sniped the hell out of Ryan here.

Yeah, it was over. Yeah, like he knew exactly what to say to me to get me to like, you know, like be a uber bullish on this. I should have bought more, though. But anyway, there's always more time. Right, David? Right. Yeah, this is the biggest opportunity cost. Instead of researching tokens in the trenches, we just do podcasts and we forget to buy. Yeah. Well, you know, sometimes we buy AI mindshare and your latest 60%.

uh of all mindshare this is according to kaido ai which tracks kind of uh different narratives so completely dwarfing meme coins at this point in time it's a very hot narrative getting into the layer twos uh later update brought to you by frax crypto's decentralized central bank which is now a fractal layer two

I've always enjoyed the Fraxel ecosystem. Okay, so starting to look at 2025, the roll-up horse race base has crossed $15 billion in TVL, up 10% on the week, zeroing in on Arbitrum at its whopping $18.6 billion. So $3.5 billion behind Arbitrum. So base...

I think many people have said BASIS will inevitably become the number one rollout by TVL. We are looking at not that far away. Especially when things like virtuals itself adds three, four billion dollars of TVL. Is it token on BASIS? Not all of the token is on BASIS.

But a lot of it is. And so I think base is really getting the AI meta tailwinds here. Base usage as well is just a chart that is up and to the right, just steadily increasing the daily activity on base. It's just a straight line. Base usage also has just been up and to the right for such a long amount of time, just consistently decreasing.

It's not really ever dipping. But I think we've done something like a 3x, 4x of activity on base since the middle of last year. And so this chart is only looking to increase. You can also see that spike of AI activity at the end of December and also to right now. I think that this...

this, um, uh, layer two beat.com. You go there and you look at the roll-ups, right? Go to the roll-ups tabs. You look at them. This is kind of the roll-up horse race. And this is sort of the starting line beginning 2025. And the two big KPIs to take a look at are total value locked, which is, you know, like all the assets on the chain, which is some, you know, almost like, um, the mass of the chain, right? How, how big it is, how trusted it is, that number matters. And then also the, uh, UOPs,

ops, which is basically user operations per second. This is kind of like TPS transaction throughput, but also sort of measures kind of like the complexity of a transaction as well. So it's a bit more of an accurate. So it's basically how many transactions are going through, how much throughput is there on this chain? These are kind of the two big metrics to take a look at for all of these. Arbitrum

still hanging on to its number one slot in terms of total value locked, but it's also, you know, like base, as you mentioned, is catching up to it. It's also being dwarfed right now, at least the past day in terms of UOPs,

uh so user operations on arbitrum is 15 on base 155 yeah okay all aspects happening on base yeah and then you got third op mainnet fourth zk sync era fifth blast six stark net seventh uh linea eighth scroll ninth world chain and then 10th circuit i think that this is going to be one of the most interesting kind of um

leaderboards to watch because it almost feels like up to this point getting to 2025 has just been like the pregame right we're just now at the starting line of okay we have the tech and we have some traction everything's beta and now like it's gonna go and it's gonna be incredibly competitive for the rest of this bull cycle

What is it? Mainnet beta. They've all been in mainnet beta. Yeah, exactly. Always in mainnet beta. Tell me about Blobs, David, because it's been chewing some resources here. Top 10. Top ETH burner.

The top ETH burner in the last seven days have been blobs ahead of Uniswap, which is nuts because, you know, at the end of the day, what do blockchains do the best? They trade tokens. But now the Ethereum blockchain, what does it do best? It burns blobs. So over the last seven days, 490 ETH has been burned.

due to blobs over 480 ETH burned from Uniswap. Dan Smith from Blockworks Research says, blob fees hit a share of REV, that's real economic value, hit a record high over the weekend, making up 9.9% of Ethereum's daily real economic value. BASE purchased 40% of the blobs, followed by Tyco at 15% and World Chain at 11%. So BASE, a huge blob burner,

Interesting. This is kind of cool because this is a prediction that a lot of people in Ethereum have made that one day blob fees would actually dwarf all other fees generated on top of Ethereum. Which is what the rollup-centric roadmap is. Yeah, blob fees are essentially layer twos, rollups, consuming Ethereum fees.

Block space, that's what blobs are. So now they're big consumers and it's great to see that thesis play out. Another thesis that's been great to see play out is Dex volumes. And David, they just hit record highs in December. Not record highs for this cycle, record highs period.

They've never been higher. Monthly trading volumes soared to over $462 billion, highest ever for DEX volumes. The leaders in decentralized exchanges for the last month in December were Uniswap with number one, $106 billion. PancakeSwap, $96 billion. Binance Smart Chain. Yeah, Binance Smart Chain. People forget about Binance Smart Chain, but it's always done numbers. It's big in the East. And then Radium on Solana with $58 billion.

So that's where we end December of some record high DEX volumes. I bet we'll exceed those records this month and the month after. And you do have to give a tip of the hat to the AI agent meta because of how damn bankless it is. It's bankless by default.

So DEX volumes are going to get tailwinds because of AI agents. TVL on-chain is going to get tailwinds from the AI agent meta. And centralized exchanges are going to really lag because in the same way that we saw this happen in DeFi summer and NFT mania is like, this is you...

get benefits you get premiums by being on chain 100 you're so right i actually didn't make that connection but what you're saying is ai agents they're not going to open up a coinbase account or crack an account they can't well they can't right i mean not really and so they're just going to use uh the on-chain decentralized exchange resources and so everything that that benefits ai agents uh and that upsurge that'll all accrue to defy that's right that's

That's right. All right. Coming up next, our favorite predictions for 2025. We've gone around the Twitter sphere and the blog sphere, so you don't have to and collected the 10 best predictions that we think are also true in 2025, or at least worth noting. And then later, Ethereum is getting a full year of upgrades. What's on tap for the incoming Ethereum upgrades and the ones later?

that come after that. So we're going to get to all of this and more. But first, a message from our fantastic sponsors that make this show possible. Uniswap, the place where AI agents love to trade on chain, on whatever chain you're on, actually, whether it's on Ethereum Layer 1 or Base or Arbitrum. But it's also got a mobile wallet, a browser wallet for all you humans out there that are listening to this as well. So we're going to go here from Uniswap right now.

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10 predictions for 2025. All right. We curated these from many of the thought leaders around crypto because every sort of thought leader puts out their list of predictions and we took the best we thought from, from many of them. So why don't we get into the first one here, David? So you picked this one, Vance Spencer framework. What's the prediction? Vance Spencer predicts that the SPX, which is just an index on the S and P 500, uh, goes to 7,500. Uh,

Where is it right now, Ryan? 5,800? You know, it's funny. I had to look this up, but it's something around there. It's something at 5,800, that range. So, I mean, going up to 7,500, that would be a pretty big increase as far as stocks go, right? That's a huge year in the stock market. Followed by AI delivers on its promises. And since...

the AI delivers on his promises line is being paired with the SPX to 7,500. I'm guessing he means that that's like AI in the traditional, you know, fintech equities space. Well, this is something that is happening this cycle, Ryan, that is unique to all crypto bull markets that have come prior is this is being this bull market. The crypto AI bull market is happening in parallel to an AI bull market happening in the real world.

And so the AI bull market is coming into crypto. Now there's like these two parallel bull markets happening. Yeah, I think Vance is basically saying that it's a bullish year for stocks and primarily led by the MAG7, right? Is all of these AI stocks will continue to overperform. All right, that's number one. Number two, this is D from Blockworks. So stablecoin market cap hits 500 billion. It is currently, a reminder, at 210 billion.

billion. That's the take here. Either Stripe or Robinhood launched their own stable coins as a pairing take and Walmart or Amazon begin accepting stable coins for payments. Stable coins 500 billion. That feels pretty safe to me. What do you think?

Oh, I it's that's big. It's more than a doubling and doubling something that's already at 210 billion is a big doubling more than doubling. So like that's that's a pretty bullish prediction. I don't I don't I'm not disagreeing with it. I'm not saying I don't think that's a free space at all. Yeah, I guess that's maybe that seems aggressive, but I don't know, man, given that.

the yields that we're seeing in DeFi these days, given kind of, you know, what I expect to be favorable legislation. We could even get a stable coin bill in 2025. You know, all the fintechs are going to front run that. If we do hit it, it's going to be a buzzer beater at the end of the year. Yeah, you think so? I mean, like, think of all the fintechs. They got to get in this. Like, Stripe just acquired that, you know, DeFi...

Yeah, that could take a while. That could take a year to really get rolling here. Yeah, that's true. Anyway, I'm very bullish on the stablecoin market cap.

I'm just from 500, 500 billion. It's just like a big goal. That's a big goal. That's the prediction. Coming in at three. This is an official prediction from Coinbase. The next administration's projected deficit spending, if it materializes, should translate into greater risk buying crypto buying as more dollars circulate in the economy. So the Coinbase is making the prediction that the fiscal policy

of the next administration is actually going to overwhelm any amount of Federal Reserve action, which is, I think, what Linaldin predicted when we had her on the podcast not terribly long ago. Yeah, okay. So this is, it's funny, this is a much more formal prediction, like phrasing, so it takes a second to interpret it because it's aimed at institutions, I guess. Deficit spending. So Congress, the executive branch, the U.S. government is going to continue to overspend.

That's not going to change under Trump. And that should translate into greater risk taking as more dollars circulate. So more liquidity, so more risk taking. So basically, the prediction is risk on assets for 2025, and then crypto goes up.

government spending money we're going to get some inflation crypto and risk on assets are going up that feels pretty reasonable too uh all right let me give you number four and by the way mike epilito had about 27 great predictions one of my uh favorite lists of the year but this was one of them the us will re-emerge as the dominant global hub of crypto he adds founders will move back and open offices in new york u.s conferences will be larger than their asian counter

So yeah, so I guess, you know, everyone comes back to America for crypto on the back of the Trump win, the victory. What do you think? I think that's right. I think we've already seen indications of a lot of companies coming back home to the United States or coming to the United States for the first time. Coming in at number five, this one's from Galaxy Digital. Five NASDAQ 100 companies and five nation states will announce that they have added Bitcoin to their balance sheets.

Or sovereign wealth funds. Ooh, nice. Okay, so this is five new nation states? Five new nation states. It matters a lot who those nation states actually are. Definitely. It's one thing I would say. Yes, yeah. I could definitely see that happening. All right, this is number six. Delphi Digital. This is a long one. I like this one. I like this one a lot. So the base prediction is crypto splits into two major...

and everything else gets sidelined. So two major verticals and everything else gets sidelined. What are these two verticals? The first is Web3 natives.

And these are defined as traders that are deeply embedded in the crypto market. These are people that possess a nuanced understanding of crypto's unique characteristics and engage in high risk trading, including meme coins, AI agents and pre-sales. The elements reminiscent of the Wild West. So these Web3 natives, Wild West, that's the first major vertical. Bull market froth traders. Yeah, okay. We've always had that.

Okay, let me go on. In bull markets, yeah. All right. And then the second major vertical this year is regular investors. These are institutional and retail investors. They often differ in their risk management approaches and generally adhere to a more fundamental investment and trading strategy via crypto as an alternative to the growth of

to the stock market. Okay, these are the two major verticals. And then they also point out, the prediction continues, there will be a number of people who are sidelined. The sidelined people are early stage DeFi, real world assets and deep end protocols that don't secure leading positions in their segments, or at least on their chain. So there's always going to be sidelined investors. But they're basically saying there's going to be kind of these DGN frontier crypto natives that

that are trading- They're following the hot ball of money. Yeah. And that's the growth stuff, right? That's the next big thing, the next wave, whether it materializes fully or not. And then there's going to be a new class, I guess, of regular investors, but fundamentals types of investors. So it's degens and it's fundamentals is one way to phrase this. Highly active, highly passive. And then if you're not in the hot ball of money, which they're saying, early stage D5 real world assets deepen, then you're getting left behind. Your pie is not going to grow this year. Do you have to pick?

you think you have to pick either be a web three native or a regular investor can you just split your portfolio i've always like oh no you definitely split your portfolio so i you know my strategy take 10 of my net worth gamble to hell with it when i make wins you put it into the long-term super passive side of yeah you do both yeah do both not just one uh you don't have to pick one lane here um

Coming in also from Delphi Digital. This is Tommy from Delphi. He says, agent-driven transactions will make up 10% of all on-chain transactions by end of year 2025. And also a follow-up prediction. There will be a wave of buy-in by San Francisco traditional AI developers into crypto AI in

Due to tokens, which afford them the ability to break out of Web2 AI labs and raise capital and community overnight, which has always been the power of tokens, permissionless capital formation outside of the system. And so tokens pull the predictions that tokens create a gravitational pull for AI talent out of San Francisco, out of Silicon Valley and into the wild west of crypto.

Yeah, I think these are pretty solid predictions. That first one that AI agents transactions will make up 10% of all on-chain transactions by end of year. How much do you think we are right now? Do you know the latest on that? It's probably less than 1%, right? I do not know.

It's got to be, even though it's starting to increase. AI agents have just only been a thing for the last couple of months. Yeah, you're right. Yeah, you're right. It's got to be less than 1%. All right. This is prediction number eight from Ejaz, which is our resident AI expert doing the weekly AI roll up with us. So Ejaz says this, an AI agent platform will enter the top 10 crypto by market cap, which

Right now, to get in that club, that's the plus $35 billion club to make it its top 10. So an AI agent platform. For context, virtuals, after its banger week last week, hitting an all-time high, is currently at $4.4 billion market cap. Wow.

E-Jazz is looking for almost a 10x on that. A 10x on that? Not specifically on virtuals, but virtuals is in the lead at the highest market cap. Okay. What are the big AI agent platforms? Let me see if I can name them. I did a roll-up where you were out, David, and I learned a lot. Dude, they're so informative. There's virtuals. Uh-huh. There's AI16Z and that platform, right? Uh-huh.

There's also, what am I missing? Those are the two big ones. There are actually quite a lot. There's a pretty big long tail as well. And so I think there's a lot incoming. There's my shells.

which is an AI agent platform. There's kind of going to be one per chain. There's one on the crypto.com chain that I'm forgetting the name of. But I think these things are turning from like kind of a premium service, which is where virtual started into kind of a commodity because a lot of people are competing to become. This is being called the layer one trade of this cycle, which is AI agent platforms.

Yeah, I think that's a good take. And I could totally see that coming true. Let's get to number nine. This was actually was mine from Fred Wilson from Union Square Ventures. He puts out a list every year. And I've read these for like 10 years. It's usually pretty interesting. I just pulled off one from his list. TikTok turns all videos into meme coins that can be traded on decentralized exchanges all over the world.

TikTok, actual TikTok, the TikTok does this? Yeah, the TikTok. That's what he said. Okay, but hold on. I think you could say just leave the prediction as is and say it's TikTok actually, right? Or you could just substitute another large social media entity kind of doing this. TikTok makes no sense.

This feels like a, it almost feels, it felt to me like it was a 2021 prediction. You know what I mean? Like the end of 2021 going to 2022, NFTs are huge and people would start making these types of predictions.

That was not the time because I think we had massive regulatory overhang at that time. It's like, are NFTs securities? Well, the guy in charge of securities says they are. His name's Gary Gensler. And so now that he's gone, now that we have really cheap transaction fees just all across crypto...

you can almost see that we have like the fertile ground for this prediction actually happening. So I present that to you. What do you think? No, I can see that. Yeah. I think it kind of remains to be seen how clear this guys are regulatorily speaking.

Are they are people really going to take the maximum freedom that people are saying that we have with the Trump administration? Who's who's going to go first and start to do really bold stuff? Yeah. TBD on when that happens and how far they go. Yeah.

All right, Ryan, this next one is also yours. So I'm going to need you to give it to me. All right, cool. Well, since we didn't have an ETH price prediction on the list, you got to give an ETH price prediction. David, I've been seeing a lot of ETH price predictions from kind of the large institutions. And let me tell you, they're uninspiring to me. People are saying, hey, next year we could see 7K ETH, 8K ETH.

that does not excite me at all. In fact, I think people are still, they have a 2024 overhang of bearishness on Ether the asset because it had an okay year, but like not a great year. It's certainly not a Bitcoin year. Pretty much. And so I felt like all of those bullish ETH predictions were weak. I wanted to give my own. I think 10K ETH is the absolute base case. All right. That's like,

If I mean, if we barely get a bull market, I think we're looking at something between 15 K and 20 K ETH. And if people think that like, that's like a, you know, I make these predictions every year sort of thing. Yes, I do. Yeah.

Full confession. You only have to be right once. You only have to be right once. Honestly, it's only a matter of time until we see these numbers. So why shouldn't it be the 2025 bull cycle is my take. You see blob space heating up. Fees, revenue going crazy. The AI meta, all the Layer 2s heating up. There's a lot of things in place for Ether this year. And if it fixes a few things narrative-wise...

I think it's off to the races. It might not even need that fix. It could just be the institutional buyers and ETFs that propel us to 10K and above. Passive investors. It doesn't take that much. I mean, we just saw this happen with Bitcoin. I mean, it feels like a pretty obvious trade to me. What do you think? Yeah. Yeah. To this day, like I said, we have still not yet seen a complete bull market with both Proof of Stake and EIP-1559 and now also Blob Fee Burn.

So we still have not seen how price sensitive Ether is to marginal flows incoming to buy.

And then the last prediction, this is a Bankless signed prediction. I think we have consensus between myself, Ryan, and our AI expert at Bankless, EJAS. We do the AI roll-ups, which if you're not listening to AI roll-ups, you need to be listening to the AI roll-ups. If you want to be one of the active traders on the frontier in crypto, it is the meta. Then that is a prediction that we are making here. Crypto AI agents dominates the 2025 meta and then hits $250 billion in market cap, where it is coming in right now at $17.3 billion. And

The prediction here is that it's going to $250 billion for AI agents. This is inspired by Ejaz, our co-host of the AI Rollouts, but I'm co-signing it. Ryan, are you co-signing it? I think I could co-sign this, right? Again, it's not for sure that this is going to happen, but I feel like this is the best upside prediction that we have going to 2025. Most precise, most specific, the most bullish. Yeah, and you know your 10% DGN portfolio is...

you know, that's where I would allocate almost all of that. I would put like 9% on this specific narrative and on that number, because to go from 17 billion to 250 billion, that's like a far more upside. 10% into the 100%. And then you take that and you put that into your fundamentals assets, whatever you want, your fundamentals. Yeah. The things that are not going to go down 99% and might only go down, you know, 75%.

And what this assumes, of course, is that this gets kind of a narrative upsurge, the same narrative upsurge that DeFi did previous cycle, where honestly, DeFi hit similar numbers. And it got way ahead of itself. It got overinflated. It went too high, of course. And that's basically what I anticipate could happen with AI agents. So this is a huge number to watch. And it came from nowhere, by the way. So it's at $17 billion. What was it three months ago? Like under $100 billion? Yeah.

Zero. Something close to that, right? So incredible. And then we have not a prediction, but a bonus take about predictions. This is, I thought this was funny, from David Phelps, who tweeted out, MFers will write their top predictions for 2025. And then everyone will be like, AI crypto will take off next year. Like, my man, the goal is not to predict what will happen six months ago, which I thought

I thought it was funny. So he's just saying everyone's extrapolating in their 2025 predictions. The thing that's hot right now. Recency bias. Exactly. Exactly. So take these predictions with a grain of salt. Probably we'll be blindsided by something absolutely crazy that hits us in 2025 and hopefully to the bullish upside. And they were on no one's list. That's usually what happens.

That's right. Coming up next, the IRS decides to AML KYC all DeFi over the holidays. A little Christmas present from the tax man. And we're getting an RSA PSA on some other weird tax stuff that happens because you all know RSA is the tax guy. Oh, yeah. That's right, Ryan. And then also our favorite, Do Kwon coming back to the United States. Just not in a good way. Not in a good way. Yeah.

And then also, Vitalik adopted a meme coin hippo. So we'll talk about all of this and more, but first a moment to talk about some of these fantastic sponsors that make this show possible, especially Frax, crypto's decentralized central bank. With over $1.5 billion in TVL, the METH protocol is home to METH, the fourth largest ETH liquid staking token, offering one of the highest APRs among the top 10 LSTs. And now, CMETH takes things even further. This restaked version captures multiple yields across CARAC, Eigenlayer, Symbiotic,

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Participate today at meeth.mantle.xyz. All right, and we're back. We have some drama, some bad news coming out of the world of taxes in crypto. Ryan, what do we need to know? Because I don't know. Okay, so let me get you up to speed, David. So this is what I kind of have digested as I came back. So over the holidays, the IRS finalized a tax rule requiring all...

DeFi brokers, I put that in air quotes, to collect user trading information. So what this does, David, is it could be a de facto AML KYC for all DeFi front ends, and that would start in 2027. So not starting 2025, but 2027. Do you remember all the proposed rule stuff that

uh like came out that the irs was basically going to do this and everyone crypto commented we had somebody on the podcast to explain this to us we all commented on the rule making the irs received like i don't know 40 000 different comments some of which were ai generated one of mine was and saying how much we didn't like this rule basically do you remember that that happened sometime last year

Okay. Well, over the holidays, they basically clarified their interpretation of the rule. It's kind of as bad as we would expect. What they're going to do is require all DeFi brokers, which are DeFi front ends, to issue 1099s to anybody who uses the platforms.

So they didn't just make this up, Gary Gensler style. You know how Gary Gensler, his operating model was just like, oh, I own this. That's a security. That's

This actually came from some legislation. You remember the Biden infrastructure bill that was signed in 2021? Well, it included some language around the expansion of broker reporting requirements that would hit crypto. And it didn't quite clarify what a broker was. It was pretty clear that any exchange that had custody crypto assets would be defined as

broker and have to issue 1099s. But it's super unclear as to whether DeFi would. And that's when vague legislation, what happens is regulators like the IRS interpret that vague legislation in the way that they wish to interpret it, and they put out a rule. And this is the clarification of that rule, and it's kind of bad news. They're saying that this rule applies to DeFi. Does that make sense so far? Yep. I'm

I'm tracking. Yeah. So what they're trying to do is get as many people as possible to fill these things out. You see what's on the screen here? They're trying to get people to voluntarily fill out a form. Well, okay. So this is a 1099. So anytime you make an exchange, you have some proceeds from a sale of stocks or something, then like the E-Trade or the Schwab, they issue you a 1099 for the proceeds of that exchange. So, you know, as a taxpayer, like, okay, well, my proceeds were like

5k for the year or something right and irs gets a copy of that too and they say oh taxpayer david hoffman you know the the uh robin hood says you owe 5k so we expect to see 5k for you so they issue it to you as the taxpayer and they issue it to the irs you could see from the irs's vantage point they basically want more of these things filled out because the more of these they have filled it's seeing like a state they want x's to fill these things out

They want somebody to fill it out, right? And their model is because they know if more people fill it out, they'll get more tax compliance. And they prefer big centralized institutions to kind of fill them out for everybody else because then they don't have to go to every individual citizen. Did you fill out your form? Yeah, if Coinbase doesn't fill out the form, then they can just take Brian Armstrong to jail. So Brian Armstrong is going to make Coinbase fill out the form.

It's way easier. On behalf of all millions of their users. Yeah, it's way easier. And so some people see this and they're like, well, the IRS is coming out to crush crypto. And maybe there's an element of that. I mean, there's people in the U.S. government that really just don't like crypto. We've seen some of that in Gensler. That's probably true to some extent. But a more simple explanation is basically seeing like a state. The IRS just wants more of these forms filled out. And so they-

Yeah, this is how it works. So they prefer that Uniswap fills it out. They'd prefer that MetaMask fills it out. They prefer that like some sort of centralized entity fills it out so they can get more tax compliance and more people paying. The argument about decentralization and permissionlessness just doesn't, they just don't care. They're like, I don't care about your decentralization. Fill out the goddamn form. Exactly, right? Exactly. And so-

Who is viewed as a DeFi broker? It's still kind of unclear. This is Gabe Shapiro saying it looks like nearly all DeFi web app providers will be covered. Some wallets will as well. Right. So you can imagine MetaMask swap certainly being covered. You can imagine Uniswap being covered. Probably unlikely that something like EtherScan is covered by this. Right.

What this means in terms of compliance is that for every single person who uses Uniswap, let's say, or MetaMask, Uniswap or MetaMask on the front end side of things would have to fill out the name and address for each customer, social security type information. It's kind of like an AML KYC type check.

because they need to know who to send the form to. So they need to know who's actually pressing the buttons and making the trade. So what this does, David... It's untenable for the design of these systems. Of course. It just de facto AML-KYC's everything that's like any kind of verb, any kind of action you're trying to make in DeFi becomes all AML-KYC. This is the monopoly on violence that the nation state...

owns running up against the self-sovereignty of decentralized blockchains. Yeah, exactly. An immovable force runs into an unstoppable object. Right. And it's, again, it's rulemaking. So it's, remember where this came from, some vague kind of legislation and then the IRS is interpreting it a certain way. So it could be interpreted differently, but this is how they choose to interpret it, at least for right now. So

What do DeFi front ends do? Well, they can either just accept that they're a broker and kind of comply. So that would mean like all the web front ends that use for DeFi, they would not just connect wallet. They would have to like have you sign up, make an account, fill out your information before you click the button and trade. Right. Or that's option one. Or they could just block US users. Right.

Because this only applies to U.S. taxpayers. What are they going to do? What do you think they're going to do, Ryan? Right. Or are they going to make all of their users give email, password, you know, address, EIN number? It puts them in a bad spot. It depends, right? It puts them in a bad spot. Or they could just abandon all of the front end upgradeability and everything entirely. Right.

and go full decentralization, right? So you can imagine a world where like Uniswap doesn't actually host the Uniswap front end itself.

There's some way that users run this locally or something like that. You become more like a broker if you're taking a fee on the actual trade. So maybe if you're not taking a fee on the trade, then maybe you're not a broker. So you could go full throttle, fully decentralized. And what this means for users, of course, is that you have to share your KYC information similar to an exchange. So the rule goes into effect.

after January 1st, 2027. But the good news is, David, yeah, 2027, the good news is it's two years away. And the good news is crypto is fighting back. This is the DeFi Education Fund. Today's announcement by the Treasury and IRS to finalize their broker rulemaking is yet another attempt by the outgoing administration to undermine the crypto industry. And basically, TLDR, we're fighting back. This is Kristen Smith from Blockchain Association. We already filed a lawsuit. So they did all this over the holidays. Yeah.

Which is kind of cool that crypto is not taking this lying down. This is Jake Trevinsky. The crypto industry sued the IRS less than 24 hours after it finalized its anti-DeFi broker rule. And basically, the crypto industry is saying, you know, according to the Administrative Procedures Act, you shouldn't be interpreting and making a rule in this way. It's like...

You don't have the power to do this and kind of kicking it back to Congress. So and then also then also we have kind of the Trump Uno card, which is maybe when Trump comes into office, he goes and reverses. Yeah, he tries to reverse all of these things. And so we got that going for us as well. OK, so my main takeaway is I'm going to wait for further news. I think so. Probably. It's just kind of.

it just kind of bad that it has, they think it has to be like this because it doesn't have to be like this. This is what I've learned has always been the case with crypto regulation is that it starts basically as bad as possible. And then the crypto community starts raveling and we get it walked back slowly, incrementally into a more favorable position. Yeah. Kind of seems to be the how, what this world is like. Yeah. I think we've got some ability to do that going. And we've gotten really good at raveling. That's right. That's right. Uh,

David, tell us what we can expect from Ethereum in 2025. I know you've been tracking kind of the roadmap, the near term for Ethereum. So what's happening?

Yeah, so the EIP mempool of which Ethereum EIPs are getting added to which hard fork is starting to settle as we get closer to Pektra as we move forward in time. So things will always be shifting and this is not the final state of things, but there's a little bit of an update here. Pektra, which hopefully goes in this year in 2025,

Some of the key EIPs that are currently going to be in Pectra, Max EB, Max Effective Balance. This allows for Ethereum validators to have 32 Ether or more. And so as you accrue Ether, that newly accrued Ether is not just a reward to be claimed, but also itself becomes staked. And this can consolidate a bunch of validators down. So if you're more running...

If you have 32, what's 30? Let's say you have 10 validators. You have 320 Ether, you're running on your machine. You're actually running 10 validators with MaxEB that could actually be consolidated down to one validator. This actually reduces a lot of messaging overhead and actually does impact the scalability of the Ethereum layer one.

because there's less messaging going on. And so people have enjoyed this EIP for a variety of reasons, both for just staker quality of life, but also for some reducing some bandwidth. So that is most likely definitely going in.

Account abstraction for EOA wallets. EOA wallets, that's externally owned accounts. That's most likely what your wallet is. So allowing an EOA wallet to also act like an account abstracted wallet. That's going in. Blob throughput increase from an average of three to an average of six. So doubling blobs in Pectra along with increasing call data costs. These are the current consensus things for going into Pectra. Notably, not peer DAS.

And PeerDAS is a massive upgrade, kind of like a 10x upgrade to Blob Space. PeerDAS is data availability sampling. It's kind of the next zero to one moment. It's the next order of magnitude moment for Blob Space. So we're getting a doubling of Blob Space in Pektra, but unfortunately we're not getting PeerDAS in Pektra. We're going to have to wait for Fusaka, which is the next hard fork after PeerDAS, after Pektra to get PeerDAS. So that probably means we won't get PeerDAS in 2025. Yeah.

We will probably get pyridacin later 2026, which is slow. Which means the only additional blob space we'll get is that increase you said from, you know... Three to six. Three to six. Which is a doubling. Yeah, but will that be enough? That's the question.

Yeah, well, it'll send blob space burn back down to zero for the foreseeable future. But I mean, what was one of our predictions is that AI agents represent 10% of transaction volumes on chains. Well, that's not eating away at pre-existing transactions. That's 10%.

additional percentage points of transaction volume. So the AI agent meta, I think will come with a massive consumption of blob space. Moving into some Bitcoin stuff, MicroStrategy wants to accelerate its 2121 Bitcoin plan. So the news is not that MicroStrategy bought more Bitcoin, but I'm sure that it will. The news is that MicroStrategy would like to accelerate

its purchasing of Bitcoin. So last year, there was a 2121 Bitcoin plan where MicroStrategy was going to put in $42 billion through debt instruments and equity to expand its Bitcoin holdings. It's now announced a special meeting for shareholders to vote on speeding up Bitcoin's

uh, the streamlining and, and, uh, capital raising efforts to make sure that we can put in $42 billion. So okay. Mike, Michael Taylor just wanting to front run himself. So no one else front runs him. Uh, so that is going, uh, that's going to be put to a vote. David, I've seen FOMO before. This is kind of what FOMO looks like, right? It does look like this. It doesn't. Like Michael Taylor just self-referentially making himself bullish. Well,

Okay, Montenegro, the justice minister, signed Doquan's extradition to the United States. So you guys remember Doquan, previous Bankless Podcast guest. By the way, we have four or five previous Bankless Podcast guests that have gone to prison or are on their way. That's because we have everyone on the podcast. Yeah, well, I told my family this over the holidays and they were like, what? You what?

What are you doing over there? Anyway, he's being extradited to the U.S. So Do Kwon was, of course, the founder of Terra Luna, the collapse. There was some question as to where he'd be prosecuted. So he's being held in Montenegro. There was a fight between a tug of war between South Korea, of which he is an original citizen from. I believe. But then the United States, where he went to school, got his first job. Yeah. He went to Stanford. Do Kwon went to Stanford. Yeah, he did. And the U.S. won that.

tug of war and so Do Kwon is coming to the U.S. to get prosecuted so that's going to happen I don't know how many years he's up for if he was under prosecution in South Korea the penalty could be between 20 and 40 years I don't know if that'll be less significant or more in the U.S. um

I'm sure he's happy to get out of the Montenegrin jail system, which I cannot imagine is, you know, all that great. I don't think the United States jail system is that great either. I bet South Korea is pretty good as far as jails go. You said happy. I don't know if like happy is an adjective I'd use to describe Do Kwon's situation at all. I mean, it's got to be pretty shitty to go from king to world to... I don't think you want to be in the Montenegrin jail system. Yeah.

All right, David. Now we got to get to the most important news of the week, which is Vitalik Buterin is adopting a hippopotamus, right? Mu Dang is a hippopotamus, right? Of some kind. That is right. Mu Dang. Yes, correct. You're correct, Ryan. Mu Dang is in fact a hippopotamus. But it's like a tiny hippopotamus. I don't think she's tiny anymore. Yeah, she's a hippo.

It's a regular hippo. Oh, no. She's a pygmy hippo. I didn't know that. Pygmy hippo. Yeah, tiny hippo. Oh, I thought she was just a baby hippo. No, that's why she's so cute. Well, she might also be a baby pygmy hippo. I'm actually not sure. Someone could fact check us. She's becoming just a normal pygmy hippo. Okay.

Anyway, the news here is Vitalik Buterin is sponsoring Mudang with a generous 10,000 TBH. What is TBH? Thai baht. Thai baht funding for the adoption. Adoption meaning basically adopting Mudang. Vitalik's not taking Mudang home, right? He's just paying to support Mudang in the Thailand. I don't think Vitalik is ready for Hippo as a pet. That's about $300,000 for anyone who is curious.

All right. So, you know, thanks to Vitalik for doing that, supporting wildlife and the zoo. The zoo thanked him as well. Vitalik responded, actually. Thanks for the warm welcome to the family and your work for wild animals. I'm happy to be the adoptive father to Mudeng as she grows up over the next two years.

Father. And support her with my donation. Maybe more as I set aside 88 ETH for Mudang plus friends. So it's not just Mudang. It's also Mudang's friends that are the beneficiaries. Mudang up 25% on the week to a $300 million market cap. What is that? You're talking about a meme coin now, right?

Yes. So Vitalik has, he received some proceeds from the Mudang meme coin. I believe he's like sold all the proceeds as well. Oh, that makes more sense. So he's trying to be a little bit more of like an activist, philanthropist, meme coin regen influencer. Yeah.

I think that's his strategy here is like, he knows that he's a subject of meme coin shenanigans and he's trying to learn how to make that productive and be making an alliance with, Oh, you send me meme coin.

I donated to charity because I did something, your meme coin goes up. And so that is an alignment of what Vitalik wants, which is capital for charity, and an alignment with what the meme coin community wants, which is Vitalik to acknowledge the existence of their meme coin. It's pretty funny. It's pretty funny. So do you know Tyler Cowen? Yes. Previous Bankless guest? Previous podcast guest, yes. Okay, so he started a new podcast, which I just sent you an episode that I think you should listen to. Oh, that one. Okay.

It's marginal revolution. Okay. So it's his, it's him and another economist and they just talk about different like geeky subjects. Okay. So anyway, one subject that we're talking about is who should receive the Nobel prize in economics. And Tyler Cowen goes, I think Vitalik Buterin should, uh,

receive it. He said like the whole economics world has not paid any attention to crypto. And yet here's Vitalik Buterin using applied economics and actual mechanism design and creating an entire like economy, open like open finance, DeFi economy. And economists aren't even paying attention. He should be the recipient of a Nobel Prize. The economic system of Ethereum is incredible.

It's incredible that it works. And it works. And it's doing amazing things. And I'm a big plus one for that. I would love to see it. I don't think we see it in 2025, but I think we'll see it sometime this decade. I think that happens before 2030 is economists start to wake up to this and start to recognize what's going on in crypto. So nothing to do with Mu Dang, but it does have something to do with Vitalik. David.

we'll send them off with this this end of the roll up thank you guys for being with us in 2025 of course you know crypto is risky you could lose what you put in but we're headed west this is the frontier not for everyone but we're glad you're with us on the bankless journey thanks a lot