Why Kraken Is Betting Big on Onchain Vaults | John Zettler & Sun Raghupathi

I don't know if I can put concrete numbers on it, but I think in terms of caliber of companies that are offering DeFi yield products through vaults to their users, it's gonna be an absurd year. 2026 is gonna be the year of the vault. - The year of the vault. Nothing said on Empire is a recommendation to buy or sell any investments or products. This podcast is for informational purposes only. And the views expressed by anyone on the show are solely their opinions, not financial advice or necessarily the views of block works. Our hosts, guests, and the block works team may hold positions in the companies, funds, or projects discussed. - All right, everyone, welcome back to Empire. Very excited about this one. So many of you guys may have heard the predictions episode that we did with Santi and Rob. My thesis, one of the thesis is that on-chain vaults is gonna grow. I said on-chain vaults will grow from 6 billion to 15 billion. Vaults will become one of D5's top narratives. All these asset managers are gonna need to figure out their vault strategy. Got a ton of questions. Basically, everything ranging from like one in the world or vaults to like really in depth vaults questions. And I couldn't answer a lot of those. So I brought on probably two of the best people in the industry to talk about that. One is John Zettler from Kraken. We've got Sun Regapathy from Veda. Real excited. So John, Sun, welcome. - Yeah. - Great to be here. Just 15 billion. - 15 billion. - He's a rookie number. - He's a bigger. - We gotta pump those up. - Yeah, you think bigger this year? - Yeah, I think bigger. - Really? - I think bigger. And I mean, I think it's a, we're just really at the start right now. All the tech is just kind of in place now. You've got the embedded wall. It's working well. You've got infrastructure that's in place like Veda. You've got a number of different fintechs who are all starving for yield in a rates declining environment. The fed fund rates going down and expected to go further down through the years. You know, I think the setup is perfect. So I'm expecting it to be, you know, I don't think hard launch, which will, you know, be lied by the time this podcast comes out. I don't think this is going to be the last one people hear about next coming months. - Can we go a little deeper into that? So I said 15 billion. You think 20 billion? You think 50 billion? - I'll take you over. - Okay, you'll take the over. - Less. - Yeah, what I'll just say to you on that is it's kind of snowball, right? So we're seeing movement from some of the early, let's say more advanced, more innovative companies like Kraken, but everyone's going to follow suit, right? Like DeFi yield will go everywhere. All assets will move on chain. So I'm expecting a fatter second half of the year. I don't know if I can put concrete numbers on it, but I think in terms of caliber of companies that are offering DeFi yield products through vaults to their users, it's going to be an absurd year. 2026 is going to be there. - Okay, so maybe we should talk about what is a vault? I'm going to ask some really dumb questions in this podcast. So maybe for the explain to me, like I'm a listener, I'm a person who's never really even heard about DeFi, and I don't even know too much about DeFi, what is a vault at the most basic level? - Yeah, well, I think. - Yeah, so I mean something. - But a context of sun's been building in the vault space for, yeah, before anyone even knew the word vault. So yeah, would love to hear your explanation. - So DeFi, like let's start with what is DeFi, maybe that's a little too basic for the users, but DeFi is a set of financial primitives that allow peer-to-peer coordination. And that's it, right? So you have lending protocols that match lenders with borrowers, boom, it's all programmatic, it's all public, it's on chain, it's magic, right? Dexes, traders, liquidity providers, and matches them. The problem with primitive DeFi is that it's not user-friendly whatsoever, and you can't package up the kinds of products you want as an institution, right? You have no risk controls, you have no compliance, you have no flexibility in customizing products for your user base. So that's primitive DeFi, now here's where vaults come in. Vaults are a layer on top of that, that allows institutions, fintechs, exchanges, anyone with users or capital that wants to offer financial products to their customers to package up the best of DeFi, layer on whatever compliance, whatever risk controls offer whatever risk return profile they want as a yield product, and that's what vaults are fundamentally. It's a layer that's it's above DeFi, that allows you to package up the best of DeFi and distribute it globally to consumers. - And it come a lot over the years, too. If you really rewind and go dial back to clock, I remember the first vault I ever used was urine finance. I think as you said, I was like DeFi summer, right? Like 20-- - That was the best fucking time. - Summer 2020, right? And the way I sort of think of vaults and where they fit into the DeFi ecosystem is a bit like a pyramid. You've got the very base layer is liquidity. And the liquidity is needed in the automated market makers, the uniswats, the curbs of the world. Those then power the borrow lend protocols, which sit in the next layer up. And so that's where you've got like the names that a lot of people here know of, of Ave, of compound, of morpho, ones like that. And they rely on the layer beneath because they need to be able to do liquidations. When people, when the collateral decreases too quickly, there needs to be solvers out there who can go sell those assets down and fulfill the loans to not have that debt. Okay, so now, you've got all these different borrow lend protocols out there. And then all these different like independent markets. And you're saying, okay, well, how do I then go get the best deal? Because the user just wants a good deal, that's it. So the vaults kind of sit at the top of the pyramid and then can be a layer to package up and aggregate all the different opportunities across the borrow lend protocols. - Okay, where does the, when I think of a vault, I think of, first thing I look at is, how quickly can I take my money out? And what is the yield, right? So some things have seven day, you're kind of stuck in it for seven days or a day. And you know, maybe some have three percent yield, some have seven percent yield. Where is the yield coming from? - Yeah, that dichotomy right there is a great point. I think there's a lot of like alpha there. Liquidity and yield are fundamentally tied, right? And to some extent, the job of creating a yield product is you have a user, you wanna know what their preferences are over these things. How long are they willing to wait to get their money out? And how much yield are they looking for? I think that's globally true. With DeFi, it's a little bit more complicated, right? 'Cause you have all kinds of other forms of risk. You have counterparty risk, you have smart contract risk, you have protocol risk and economic risk. And so I think that like the construction of a good fault product is in some sense optimizing over all of these different considerations. This is also why you need flexibility in fault products, right? You need to be able to, for any given user, optimize for what they care about over all of these dimensions. - Yeah, and then to your question, right? Of like, you know, where does the yield come from? Like, don't worry, I've got this one dialed in. - Because I know, we're launching on Monday when the spot desk comes out. I'm already expecting to reply guys to be in there with the goose meme. - Where does the yield come from? - You got it. - Oh yeah, I'm ready. So reply guys, watch out. - I'll pass in the legal team and crack it. - Right, right, right, you've been in my year as well. But this short version of this right is going back to that layer of the borrow lend protocols that sit under the vaults. There are borrowers on the other side. And that's really ultimately the primitive of what's driving the yield. People want to borrow assets out of these protocols typically for the use case of going levered long. Which is one of the reasons why USDC is always the one that people want to borrow the most against because they could post their cryptos collateral, pull out USDC, borrow it, and then go buy more crypto with it. - And that's like, put them in. - And then, lever up again and then then, yeah. - There's all sorts of things they can do from there. And you know, buyer view where your mileage may vary. But ultimately, you know, kind of going back to it, where does the yield come from? It comes from on chain borrowers, people who want to pull out typically USDC or other stable coins for any purposes. And then when you, you know, package that up in all the different protocols, that's really like, you can change the collateral type, you can change the protocol type, you can change the liquidity windows, all these different parameters, then layer out to a equilibrium of sort of a risk and yield curve. - Yeah, okay, so when I give my money to a vault and I get the, so I'm putting, you know, let's say, $100 into the VATE vault and to one of the VATE vaults, I get 7% on that. The 7% is because you guys are then lending out my money. - Effectively, there's lending, there's other protocols that are involved as well. But yeah, it's being deployed into DeFi protocols that are, again, peer-to-peer. So there's users on the other side that are making productive use of that capital. - So there's a layer between, right? So like, the assets go into the vault, the vault allocates. And so then then it's being supplied into something like, ape, or like, Tidra, which is, you know, the instance that exists on ink. And then, once it's being supplied in there, the protocol itself is handling all the lending out. You know, it's their pools, it's not like peer-to-peer in any sense, but someone's going in on the other side and pulling from that pool to borrow it out. So that's kind of where it all is coming from. - Do you have a sense of how much of the borrow lend protocols, like how much of AVE, AVE supply that's being lent out to them is through vaults? - That's a great question. - So I would say for AVE, most of it is direct, probably. I mean, AVE has something like $40 billion. - Maybe more foes, the larger person. - More foes, mostly vaults, right? And this is a super, I mean, this is an interesting subject. - And more foes controls the vaults and they are the borrow lend? - Yeah, so let's go through it. AVE, more foe of AVE, because there's a very linear progression here. So AVE is like the OG, or one of the OG lending protocols in D5, right? It's basically decentralized. It's governed by a Dow. But the fundamental economic model is a pooled system where you lend your assets into it. It goes into this big global pool, right? That has many different assets and collaterals. And anyone can come and post any one of those collaterals and borrow from that global pool, right? So let's say the supply is a bunch of stablecoins. USDC, USDT, DAI, whatever. And the collaterals are ETH, BTC, liquid-staking tokens. You can deposit any of those and pull any of the supply tokens. So it's a pooled model, that's the important thing. You don't need vaults in that setup because there's no decision to make, right? You just put your assets into AVE. The AVE Dow is doing the risk parameters of what collaterals are being supported, what are the borrow cabs, all of that stuff. And more foe came along. And more foe said, OK, what if we don't want one size fits all for lending, right? What if we want people to be able to choose what collateral they lend against, right? Because with AVE, if you do, you don't get that choice. So more foes are set of isolated markets. It's the one collateral, one loan token. So think of it as Bitcoin, USDC, ETH, USDT. And these are siloed, right? But then more foe introduced vaults. And vaults are necessary in the system because when you have siloed markets, it's super fragmented, super inefficient. There's no shared liquidity. So you can create a more foe vault that says, now I want to allocate to this market and that market. And you're packaging up different forms of collateral that come together into a yield product. But that's just more foe, right? You don't have a more foe vault that can earn on AVE, that can go to other protocols. So more foe vaults are a step in the right direction, but it is still too specific. It's still not flexible enough. And this is where Veda comes in. So Veda is multi-protocol, multi-chain. This is like our design principle. The goal is that you should be able to aggregate any form of defy whether it's more foe, whether it's AVE, whether it's Pendle, whether it's RWAs, right? Packaging up all these things into a single product with the most flexibility possible is the ultimate evolution of vaults. And if you actually look at what other players are doing like lending protocols like more foe, they are increasingly trying to diversify their vault products to be more and more flexible. So I think this arrow only goes in one direction, right? People, I mean, John can speak to this, right? Institutions want flexibility because they want the best yields. They want the most product flexibility to be able to target these different risk return profiles. So I think we're only going to go in one direction and institutions, enterprises will want multi-chain but want multi-protocol. They don't want to be locked into any single chain, any single protocol. Yeah, I think that right there is yet. It's like the multi-chain, multi-protocol nature of Veda is really the superpower. Because unlike a lot of other instances that have launched a vault, they're usually just typically isolated into like one thing or one market. And when that market, when the yields go down because you don't have those borrowers anymore or no one's wanting to use that market, then it becomes a lot less attractive. And there's other products out there that have already started to see some of those decreases in their TVL because the yields are now falling to like three and a half or sub three percent. So that's really a superpower of Veda and speaking from the crack in perspective and what I think is a shared perspective, a lot of Vintex, that is ultimately, I think what's going to win the day. Multi-protocol, multi-chain, allowing that simplicity and aggregation in the most, the highest form. Is the, if I try to summarize all of that, is it that all of a pioneer, basically lending borrowing and you've got the big open pools, Morpho introduced vaults and then Veda took the kind of self-contained Morpho vaults and introduced a new model which is kind of multi-chain open-ended vaults. With the nuance that our vaults existed before Morpho existed. So we were building vaults before that, just as a minor correction, Ave Pioneer Lending Borrowing at Scale, Morpho introduced modular lending. So it's package up your specific lending products, your specific risk return profile. What Veda has introduced is truly abstracted, flexible, multi-chain, multi-protocol vaults. - And also like, you know, just jump in. There have been a lot of other players too. That's not forget compound, you know, compound. It's one of the first ones to borrow lend. - They were the first, actually. - Syntetics was like the first one way back when that was giving you yield on your tokens. You're in bolster, who are, so you worked at Coinbase when you worked on the Morpho integration. - That's right. - And you're cracking work on Veda. Who's like, I mean, if you did like an RFP, like who are the other multipliers you could have looked at? - Yeah, so I would say there's, so maybe one thing that's also worth mentioning to is the difference between the vault providers and then like like the administers who like provide the infrastructure versus the risk managers. - Yeah. - That's also an advantage. - We should actually talk about all of the key parties. - Yeah. - Yeah. Vault operator. - Yeah, so let's maybe, can you get into the different departees involved here? - Sure. So like the way that I would describe it as simple as I could is that, you know, Veda is the administrator, the administer of the vaults and provide the actual infrastructure. Everything down to like doing the daily nav calculations and so forth, like that comes from Veda. And then there can be off of Veda's infrastructure, many different risk managers, what they called, who then operate the vault, who come up with strategies and then decide on the allocations of those vaults. And so in that world, you know, we're with this launch that's coming out, you know, the day on Monday, when this podcast releases, we're working with Chaos Labs and with Centura, two of like, you know, premier risk managers in the space. Chaos Labs, people might know from working with Abe, they've managed the Abe Dau, risk managed the Abe Dau for quite a while now. And Centura is more institutional focused, but you know, growing very quickly and a great partner to work with. But there are many others too. And I think other ones that people might have heard of along those lines are like gauntlet and steakhouse as like two other examples of risk managers out there. - And I'll just add to that this category, you can call them risk managers, curators, whatever. This category is growing rapidly, almost as quickly as vaults as a whole, because you have the largest asset managers in the world already today are becoming interested in diversifying their offerings through these on-chain products. That's gonna explode, right? Like we have this nascent, these are very crypto-native companies, right? Steakhouse, gauntlet, chaos. But the biggest trad-fi and even, you know, trad-fi adjacent crypto asset managers, they have the skillset to do this and they're already starting to move on-chain. - Probably a really dumb question. Why do you need the risk managers? Why do you need gauntlet and steakhouse and Sympola, what are they called? - Centora. - Centora. - Centora. And chaos, why don't you just do that yourself? - Yeah, that's a good question. I believe in a world that like has diversity of curation. Like there's never gonna be one party that just manages all of the world's assets. I mean, you could say like BlackRock does a lot of it, but even they don't, right? Like there is a diversity and plurality. And if I think about what our advantage is, it's really the crypto-native, definative stuff, right? Building the plumbing, making the infrastructure work, the widest possible access to chains and protocols. Are we really gonna go toe-to-toe with the BlackRock to the world in risk management and building trust with capital allocators? Maybe, but that's not the business that we're doubling down on. So it's just a different business model, right? It's who playing to our strengths. And from our perspective too, the other interesting thing to add is that we can integrate against Veda once with one standard integration, one model of the way that the vault works. And then you can get N number of different styles and ways of how those vaults are shaped and formed and how they deliver returns. - Yeah, one more question on this front is, you know what we said? So we now have chains building apps and we have apps building chains, right? You kind of go up and down the stack and people as the industry's growing verticalized, Will, do you think that we'll see any of the curators start to maybe try to own the layer below? - It's already happening. - They're trying, right? So Gauntlet has their own vault infrastructure product. - Interesting. - Which is similar to Veda's. - In the market? - It's in the market. I don't know if anyone is really using it, but it's out there. I think the challenges that-- - How they before do is gonna have a vault. - I think that's closer to a more foe than it is to a vault product, but you're right. - Yeah. - You know, protocols need vaults. Hyperliquid, they have their own vaults, right? Like everyone wants vaults. I think the challenge is that building a successful vault platform is very different than these other things, right? It's very different than building a successful landing product, different than doing good curation. There's really economies of scale with doubling down on vault infrastructure because it's so complicated, it requires a lot of attention to detail. So none of these people are trying to vertically integrate. I think we'll have a better vault product than we do, right, as an infrastructure. Now what they're trying to do is capture more margin, right, and power to them. But in my view, they'll be out competed by the curators that focus on their expertise and use the best infrastructure that exists. - So how do you pick these curators or risk managers? - Yeah, great question. What we're generally looking for, just speaking from the lens through which we saw this at Kraken, as we wanted someone who had experience doing curation at scale, chaos labs, being a great example of that. They've been working on doing risk management for the Ave Protocol for quite a while now. Another thing that's important right is their security model, their familiarity with working with the vault provider. So someone who's actually had experience like Centora has had plenty of experience working with beta. That was important because you know that there's already that relationship there that know how. And then I think furthermore, there's, you know, sometimes also a level of craftiness and innovation of being able to consider different newer protocols, looking for temporary incentive programs that they can deploy into, and also sometimes like new thing. And some of those other more slightly higher risk activities, but that can bring about more yield. - What I'll say is there's a large number of curators now and risk managers in the space. It's a huge, there's a very long tail of people that are just doing stuff like, you know, they don't really know what they're doing. You tend to see power laws in this category with everything in finance, right? You have curators who have managed billions of dollars at scale and they know what they're doing, right? And they have institutional relationships and they have like really deep data models. And then you have ones who were just like, yeah, you know, we're just gonna kind of go my around. So it tend to kind of separate on them. - Do you think so right now, so chaos, gauntlet, and stake house are probably like three of the leading people. Do you think that we will see traditional asset managers moving to this space in 2026? Like will, yeah, traditional asset manager become, you know, try to compete with gauntlet on this business? - Absolutely. That's like a very, a prediction. I'm very, very confident. - Yeah. Will they do well? - They will. - They will because they have the customers, right? Like the defy curators in some sense are competing for this pool of defy users, right? Or they're trying to go to, you know, large credible institutions like Cracking and sell their services to the people who have distribution. But the largest asset managers do have distribution, right? They have customer relationships. They have assets that they can funnel into their products. So I think it's very difficult, right? The BlackRock comes on chain and says, we wanna bring $100 billion on chain, they can do it. Do you want, when BlackRock launches a vault, you want them to do it with you guys? - They will do it on beta. - Yeah, okay, okay. Can we talk about the revenue in the business models? Like where's the value being captured here? Is it, is it, let's say someone, let's say there's $10 gets made. How much does beta make? How much of the risk curators make? Like where's the flow of capital? - Yeah, sure. I'm happy to do it going to it. So the vaults themselves are built in such a way that they take a performance fee. So a percentage of the rewards that are earned on the vault basically get set aside to the operator of the vault. Basically whichever address equals the curator equals the risk manager. - This one not quite, because like it goes to, the holder of the admin key basically, and that admin key can provide a 0X address that all the fees get paid to. So in this case, in the vaults that we've launched together with this release, we've got three vaults. They are 25% performance fee. Those rewards then flow into a fee splitter, smart contract, very simple. And then that split between cracking as the distribution partner, bringing all the customers in volume, the lion share goes to that distribution, beta as the infrastructure provider, and then also the risk manager of that vault. - Got it. I can tell you a little bit about like my philosophy with beta as a business. Our goal is to serve thousands, tens of thousands, hundreds of thousands of vaults. And who is going to take the lion share of the fees that are actually generated in these products? It's going to be the distribution, the people who own the distribution. But our goal is to serve everyone. And so you kind of have this dynamic where the distribution partner always takes a lion share because they own the user. The curator comes in and they're kind of competing based on their ability to outperform. And our goal, we operate more like a SaaS company, right? Where we're providing the technology platform. - Exactly, that's right. - Do you care about owning the distribution at all? - I care about it in the sense that owning distribution is great, it's a great business, but that's not our focus right now. - Sorry, I'm sorry, I'm sorry. - So you'd rather go to the exchanges and the Fintechs and Klarna and Robin Hood and crack it and integrate. - In general, the trend we're seeing in DeFi, DeFi is increasingly a back end, right? You have two choices. Either you're going to do the consumer thing, like the either files of the world plasma where you're building a neo bank effectively, you're trying to compete with the largest exchanges in Fintechs, that's a really hard battle. It's really expensive, there's a lot of luck involved. Some people are fighting the good fight. If you're not doing that and you're building infrastructure, you need to be going to enterprise, right? Meaning the Fintechs that are moving on chain. - Yeah, that's interesting. Go ahead. - Yeah, it's just like, that's what I think, you know, Sunspoint is really interesting too, because there is, there could be this perception that, you know, this product, like the classic DeFi mullet, you know, of Fintech and the front DeFi in the back, is competitive to DeFi, but it's really not, like it's really complimentary to DeFi. You're basically just a different front end that's bringing it to all the same protocols and all the same activity and TV launching. And my view here is like, you know, someone who has been using vaults since, you know, the DeFi summer, I guess, and even before, the problem has always been like keeping track of where all your money is, like where the heck is it? What, oh yeah, I use this protocol, like three months ago, I forgot, I still have like money over there and this one over there, like that's a pain in the butt. Metamask or whatever self-custody wallet you have, always has issues with your ledger and like that's always a pain in the butt. And then you're like, okay, well, how do I read all these things? Well, then there was that like Zapper, I remember I used Zapper back in the day that like connected all these things. - Zapper zero on that. - Yeah, like those were helpful and that was a step in the right direction. But, you know, I think they've degraded and I don't use them anymore. I remember one of them I think went out of business or something, so it's been like challenging and not easy to use all these DeFi protocols, especially if you have to go to four or five or six different websites to go find the best yield that you're looking for. So the beauty, I think, of where this is going and speaking of like distribution partners is once you have that packaging that aggregation layer of vaults and then you have it plugged in into a traditional easy to use Fintech with a slick native app. You're bringing it right to the user's fingertips without them having to think about much. And so the way we've done this is you know, we've worked with an embedded wallet provider privy, which probably a lot of people in this podcast have heard about who are required by Stripe. They've been a pleasure to work with. And what it allows for is it allows for a non-pastennial wallet that's embedded under the hood directly one to one with the user account. So you know, you've got like your cracking account, you've got your cracking account, you each have an embedded wallet that is just yours. And but we cracking can't touch it. We can't move the funds, we can't influence it. We can't do anything about it. It all requires you to be in the loop. You'll get like a one time OTP code, like a a small six digit passcode that comes to your email from privy. You type that in, that's your way of like assembling all the pieces and then you can actually interact and do the transaction. So I think that's where this is going, which is that your bring DeFi is increasingly becoming a backend, we're packaging it up, crew vaults in a way that's simple and easy to use. And there's not a lot of active stuff that the user has to do. And then you're delivering it in the same thin tech channels and the same apps at the user's fingertips without the need for ledgers, self-custody, 17 different websites and everything else. - Yeah, very interesting. I think Sun's point around you guys really just a tech platform is kind of shifting, that's probably my takeaway the episode so far as most of DeFi will really just become a backend. And yeah, maybe a few will survive as run ends, but those, if that's the case, you end up really trying to compete on distribution with yeah, Robinhood and Coinbase and Kraken and you've got a, that's a hard game to win. - You go in New Bank, Revolut, then you get into the traditional banks like DeFi. So I'll go step further and say, this is not just beneficial to DeFi and complimentary. This is actually the only way that DeFi succeeds. Right, I think, you know, I've been building in the space for a while, we all have, there was a pipe dream that we would invent this entire independent financial system and just migrate everyone over. Like everyone's gonna leave the banks, leave their exchanges and fintechs and move on chain. But that was always a pipe dream, right? And where we're at now is a land of compromise where there's tremendous value that DeFi has created. - I mean, just like, we haven't explicitly said this, but you have Kraken users, millions of users on this exchange, who with a single button are earning yield on ink, Ethereum, across multiple protocols. They can see their assets at all times, right? That's all on chain. They can get those assets out whenever they want, right? It's, they're getting the best most competitive yields that exist. That is an amazing product experience. And so I think this is, this is actually necessary and it was inevitable. I think I took people while to realize but this is phenomenal for DeFi. - Yeah. John, can you talk a little bit about the learnings from Coinbase? So we haven't talked about this, but you spent like five years at Coinbase. You're running a lot of product stuff. I think you helped build out their staking, CBE, vaults with Morpho. Can you talk about the learnings from your experience with building vaults at Coinbase and Morpho? Like, what went right there? And then what also went, maybe you could have been improved upon? - Yeah, sure, I would say. So first off, like, I don't want to steal the thunder from some of the great people at Coinbase who continue to make these products awesome. Being early and helping start a product zero to one is just a small piece of the battle. And there's tons of people in the trenches over there who continue to grind and make that thing better and better. And even, you know, my role was pretty small. There was Andrew Holt, Maravila, like my, you know, co-founders, product co-founders from the engineering and design side who are super important. But like to speak maybe directly to your question of the lessons, one of the things that Coinbase does really well is that they favor first party products to provide a more integrated experience. More like the Apple model than like the Android model, so to speak. And so with the Coinbase approach, it was, you know, a vault provided by Steakhouse, built on Morpho, which is a Coinbase Ventures portfolio company. On top of base, they're L2, delivered to customers using USDC, which is there pretty much they're like first party token, you know, with circle, they're both like co-owners of it. So the very like up and down integrated nature of it made it quite easy to use free gas for the users and a pretty slick experience using their own server signers for the embedded wallet of it all. That one of the things I'd learned building that product was the relentless focus on being the easiest to use. Like Coinbase had this saying always internally that Coinbase wanted to be the most trusted and easiest to use. And that was like as Brian would always say, those are like our two differentiators, those are the things. So, you know, you try and bring that into all your products. And I think those lessons really have influenced me in becoming a product leader of, you know, those are necessary for everything. Like you always want to hammer and hammer on the user experience, always try to make it easier to use and improve upon it. And, you know, the whole Coinbase DeFi suite has been doing quite well. I mean, if you look at their borrow product, there's some dune dashboards we can put in the show notes or something I can send it to. But, you know, they're up to I think 1.9 billion of collateral in the borrow product with about a billion of loans issued against that. That's the DeFi borrow side. Of the lens side, I think they peaked it around 475 million of TVL, it's come down a little bit as the yields have trailed off. But it's been, you know, by and large, I would call, you know, a successful suite of products at Coinbase. And I think they're just getting started, you know, hats off to them. But, you know, putting, I have, you know, swapped my team blue for team purple. And the thing I love about Kraken is that we have an opportunity to use providers like Veda where it's not all just first party, you know, products and services, but we can really source the actual best in the industry. And the vaults that we have here that we're launching with, I mean, we're just going through the demo before we got on air. And the yields are substantially better. And one of the reasons why they're going to stay better is because of this model of going multi-protocol, multi-chain, using someone like Veda, allows us to source the best yields from across the ecosystem. So like fundamentally in long term, this is a more advantage approach. It is a smarter, better strategic approach because you're going to long term have better risk adjusted yields when you have more diversity and opportunity. - Yeah, for someone who's listening who says, I've heard this story before. It's called BlockFi. It's called Celsius. I open up the platform. I get 7% yield, all good, no risks. What, how do you talk about that? - Well, maybe I can take this one. So there was things that they did correct BlockFi Celsius in that the product experience was great, right? And clearly people want yield. Like that is a no-brainer. It's a universal demand. The implementation was totally wrong in its night and day. And this is why DeFi is such a superpower. Because the difference is when you gave your money to BlockFi, you had no idea where it was going, right? You had no real claim over those assets. They could do whatever the hell they wanted with it. And they did crazy shit with those assets. With this model, I'm not going to say there's no risks, right? Because everything involves risk, any financial product. And obviously crypto and DeFi involves its own kind of unique set of risks. But you know where your assets are at all times. It's all on chain. Even if Crackin goes down, there's a global outage, right? You lose your phone. You can literally go to the blockchain and see your assets. And not only can you see your assets, you can see your claim to the set of assets that are in that vault. And only you can redeem your assets. You only you can redeem your assets from that vault. So it's just totally night and day, right? You take this universal demand which people want, high yield savings accounts. That's just like a killer product. But you build it in a way where it's transparent, right? It's truly non-custodial. And most importantly, right? Like it's all public. Everyone can see it, right? So that's what I think is fundamentally different. I think those set the industry back a long time. But also, it's probably necessary because people now really value the important things like Prince Francis. - Those weren't DeFi. Yeah. You know, they were CFI. They were like over levered, risk-taking private books that were making shit loans to shit counter parties. And they got screwed, you know? And then the customer suffered. And but you know, remember when like all of that happened, last, you know, the last turn of the tides and we went from bull to bear. And I guess it was a 2022, you know, through that just bloody year. All of DeFi went unscathed. - Yeah. - You know, it was just functioned and operated as it was supposed to. These were over collateralized loans. The collateral was there. The risks were managed. And when those liquidations happen, they happen in an orderly way. And the users, you know, everything was functioned as it was supposed to. - Yeah. So you were showing me a little sneak peak of the product which looks great, people should try it out. Other side note on Kraken's product have been getting markedly better over the last, probably eight, two months, I'd call it. So yeah. - Yeah, I would call it the Argin Effect. Like Argin is our CEO who's been on the pod. - It's nuts. The things Argin has done for Kraken, I think have been unbelievable. - He's a great leader in the sense, every leader is very different. And the joke I'd say to some people is that I can't imagine two different people than bright and armed strong and Argin's happy. - Tell me what? - But both are incredible. They're so different. And in so many ways, I don't even know where to begin. But one of the ways, and one of the things, maybe I'd reframe it in just one of Argin's superpowers, is that you can always move faster. We can always be better. We can always be leaner and we can always be hungry. And so it's this constant drive to move faster and to do more with less. That reminds me of this, like it's that feeling you get when you're in a smaller stage startup that's really working, that's in product market fit mode. And it's awesome. Like it's just, it's such a refreshing change of culture because it is no process for processes sake. There's no big quarterly planning cycles. There's like you've got a one OKR, which is like your revenue number at the end of the year you have to hit and like grunt. And tell me what you need to, what resources you need, what, you know, financials you need, whatever you need to make it happen. And, you know, mountains can move around you to get what you need and to move fast. Yeah, how does something like this vault product get approved at Kraken? This is bottoms up. You guys go to Argin and you're like, "Yeah, I think we should do this idea. We should work with beta." Is Argin like we need an earned product? Yeah, so I mean, we have, so even when I was hired, you know, Argin was, you know, closely involved in my recruiting process. And this is one of the things that they were already starting to talk about and was like, it was already starting to be built. But there was a lot of lack of clarity in how it was going to get structured, how it should be designed, how it should be engineered. And so there had been this view and there had been a lot, Argin had brought in a couple of these strong, more on-chain crypto-native individuals. That is also, I would say, like a superpower of Kraken. You've got all these like really like OGs, cyberpunks, like really like early, early, and evangelist kind of people in the crypto space. So there was this knowledge and this understanding that we wanted to do this, but there wasn't really an understanding of how to do it. And I'm really happy with where this product landed, but it's just the first of many. Like there's a whole suite of on-chain, defy-oriented products coming our way. And I guess that's probably where I should leave the teaser and a cliffhanger for the next one. - I remember actually the day that John joined Kraken, 'cause we'd been chatting, we'd been working with the Eing team. And obviously, everyone wants to learn product and we were talking about things. But I remember John joined and shit just started moving. It was more credit to Argin finding the right people to come in and build the products that the company views as important. - Did you know for this product that you wanted to use beta or did you talk to Morpho too and other people? - We, there were some thoughts and some different opinions inside the company as there's always a ton of different opinions. And I think we just had to all work together to come to common sense of what was gonna make a lot of sense. And beta was a very obvious choice because of some of the great, what we keep saying is this cross-chain, cross-protocol opportunity to deliver sustainable, higher yields than you can get elsewhere. - The yields you showed me were like, I think there's one that was like two percent, one that was three percent, one that was six percent, six and a half, something like that. Did you ever think about a 20 percent, like you can, you can loop, you can get to kind of the percent you want. There's just increased risks, so. - Yeah, as long as we don't start getting, you know, Terilune attaches on our shoulders and start talking about 20 percent, you know, like that, I'm gonna get flashbacks, should we get that, you know, like the Chihuahua meme. - But there's a lot that if you want to give the user, the best experience, or the, if you wanna give them all the options, which is this open beta model of like, you know, just serve anyone, anyone, everything, you should serve them 15 percent, you should serve them 15 percent. - I'll bring that question back to you. It's very similar to like how much leverage do you let someone trade with, right? - Like I like that you can take the slider to 100. I don't go to 100, but it's nice. I feel good as a user that they don't stop me out at, you know, 10X or something. - What I'll say is like we have very much an intention to add more bolts over time. So this is the version one, right? Like this is all, you know, planning our flag on fresh virgin territory and saying, you know, we're here, we've got a lot more coming, you know, come work with us. And so, you know, anyone who's out there listening to this pod, like, you know, is a risk manager who has any differentiated strategy they want to, you know, pioneer or bring, like come talk to us, you know, we're not hard to find. You can DM me on Twitter or some and like, let's start talking and figure out, you know, what additional opportunities we can offer. Because, you know, the interesting pitch. If someone comes into slides into your DMs, what is the interesting pitch? Is it their track record? Is it the APY, APY they can deliver? What is the, yeah, like show me what you're doing and why it's differentiated. Show me that you've been doing it before and that it's not like, you know, track record over two weeks and explain why this is going to last over time. - Yeah, yeah, no, I have a question for you actually. - All right. - So you put out a tweet, right, about your prediction that vaults would be huge, right? And we kind of discussed this. One makes you so bullish. I don't think we've heard you like kind of articulate that. - I was at a holiday party with there's two theses. One is the one that we've talked about a lot, which is the D5 mallet. And I see what's happening with everything from like, Coinbase to now crack into like, if you go on the world app, there's like vaults powering it. It feels like every single one of these fintechs will launch that. I am fully on board with this thesis. But the thing that like really kicked me into that was I was at a holiday party and one of the largest asset managers in the world was there. And they said to someone else who is at one of the largest, they service the asset managers. Two, they're probably like 50, 55 years old, as traditional tradifies it can get. Where's the suit and tie to a holiday party. And one says to the other, have you heard of these vaults? The guy says vaults were, I was expecting him to say what are vaults? Because vaults were all over vaults. They know steakhouse, they know gauntlet, they know Morpho, you know, like they, I'm sure they know Veda, like they were deep. And they're both of them in different ways where they said they're coming into the vaults business. - The suits are coming. So I'm a little less optimistic than you are that they will be able to compete with. Gauntlet or steakhouse or chaos. Because they own distribution, but in a very different way than like Robin Hood owns distribution. Like Robin Hood owns, the user goes to Robin Hood and can click a button. The user goes to Crackham and can click a button. BlackRock is like, BlackRock actually doesn't really own the distribution. I think Black, like Charles Schwab owns the distribution. And you could buy the BlackRock products through Schwab. I mean, I'm, you can also go to BlackRock if you want to, but it feels like a very different. - It is different, right? They have to go and talk to people. - Yeah, they go and talk to people and convince them to do it. - It's like a product that sold by financial advisors as opposed to something that is, like I think Charles Schwab owns distribution, TD Ameritrade owns distribution. So, and I think on all of those platforms, that's where you'll see this. - Yeah, and like, would it Taroon ever go work for a BlackRock? Like, I don't think so. Like, you know, like someone who's like, as deep as it comes, the Taroon founder of, you know, about, of Godlike. But, you know, you kind of require someone who's like, deep on like, oh, yeah, well, Athena is right now paying, you know, this good yield. But as soon as Eath starts to tank, you know, that's gonna disappear and we gotta be ready with our strategy over looping on Euler. Don't worry, Euler is good again. It's like, you know, it got hacked before, but it's safe now. And, you know, oh, we're gonna go over here and then gonna do some looping on Ave with, you know, some LSTs, LRTs. I don't know. I may be also skeptical that like, that level of crypto-forward individual has a, you know, would want to go work in one of those big institutions. - With that being said, I have another meeting I had, there's a dinner actually with one of a huge hedge fund portfolio manager and I was like, oh, are you under crypto? He's like, he's like, he's like, you wouldn't believe the looping that I'm doing. I was like, oh, what are you doing? He's like, I've got, you know, levered in the nines on super state with US, what's their thing? USCC. He's like, I'm looping USCC like several times right now. And so where, I think these folks are smart. And it's not, crypto and traditional capital, on-chain capital markets, or traditional capital markets will eventually converge. - Right. - And they'll just call them capital markets one day. - Yeah, I mean, like the set of yield and primitives that exist today is gonna change over in the next five years, right? RWAs are gonna move on chain. There's just a much larger asset universe that exists outside that I agree with you. I think things are gonna emerge. That being said, I definitely think the people who are here today will have that expertise. They're gonna be big as well, right? I think there's enough room for all the people who are forward thinking to win. - Yeah. Can we talk about maybe the behind the scenes of what's happening here? So in up and coming, every time in crypto, there's like these new up and coming space. There's only a few players. There's all these crazy backdoor games and dealings. And you know what, I'll give you like my first three years of revenue if you do that. There's all these, can you tell me about some of the games that are being played? - Yeah, it's a good question. I can tell you that it's a similar dynamic in that there are a few live players, right? We've talked about a number of them. There's a finite universe of players on the other side, right? People who are as credible as Kraken and who are worth pursuing aggressively to try to win business from. And then there's just the levers that each everyone has, right? A lot of projects, token projects have large amounts of their tokens apply. You're marked for these kind of deals, right? And like the trend that we're seeing, people you talk about you're earned back in the day, right? People used to pay for liquidity. That was what token incentives were for. Now token incentives are for paying for distribution. And it's a very different model. I think it's a better model. Now look, my view is truly, I know this is kind of a cliche, but like the best product will win over the long term. And everything else is short term. You're trying to establish credibility. Maybe you're trying to raise money. But at the end of the day, you need a product that will allow your partners to out-compete their competitors. So that, you know, Vated doesn't have a token. So we don't have a massive war chest that we can use to throw money around. Like you see these things with-- - You guys raised, though, you raised 18? - Yeah, yeah, yeah. We raised our series a, you know, early mid-mid last year. - Yeah. But, you know, we're not talking about that. - Who loved that? - Coin fund. - Nice. - Okay. - But just maybe to follow on that point, like I think where some of the games get played are often in those token incentives. - Yeah. - And where they come from. - And is this like, sorry to interrupt you there, but like, is this everyone's competing? Everyone wants Robinhood, right? Everyone wants to be the vault on Robinhood. So then you go to Robinhood and you're like, we'll give you like $6 million of our token. If you choose us, is that-- - It's like all the layers. - Okay. - But it's like the bar-line protocols will go to the risk managers and the curators and be like, well, come deploy with us and we'll incentivize it with our own token. And then, you know, the nice thing if you're a cracking user is you don't have to deal with any of that. You're just getting USDC on USDC. So it's, you know, all being handled. - So all of a could go to stay cast and be like, guys, like put your vaults on AVE instead of on, I don't know. - In theory, yeah. And they could like issue them, you know, AVE tokens. And, you know, all they had says that I think be approved by the DAO and so there's some of that. But the other protocols might not be, you know, might be more independently driven, some of those decisions. - Yeah. - And then, you know, so like that's A area where the games get played. But there's also like that token incentivization can also happen at the distribution layer. Like so, I was just popping open the Coinbase Lend product, you know, similar to a competitor to what we're offering with Crackin's DeFi Earn. And in the Coinbase version, right now, the yields are at about three and a half percent. But if you pop it open, you can see that 75 basis points of that is coming directly from Morpho as a extra boost that you're getting in terms of in Morpho token. So it's like, well, that's not really the thing I came here for. I'm, you know, coming here for USDC. And I'm coming here for USDC yield. But that's, you know, indicative of kind of where a lot of these things are. - Oh, gets paid in Morpho token. - Oh, interesting. - Yeah, I think you can convert that into USDC, but that's speaking of like token incentivization. That's a big thing. The nice thing is it for all the customers here who are, you know, just can't wait to come use the Crackin DeFi Earn product. It's just, you know, straight USDC on USDC. It's pretty simple. - Son, what's the craziest, like, backdoor thing that you saw where you're like, I can't be involved in that game. - I don't know that I can say the craziest things, but I've seen people offer insane amounts of equity for a single deal with zero guaranteed revenue ever. And it's very common. And honestly, it might be worth it, right? 'Cause like, you get one of these major partnerships and each one of those builds credibility for the next one, right? 'Cause this is ultimately about trust, right? These large institutions, they want someone who is, it's de-risking. They want someone who's done it before. So I get it, right? But yeah, it is crazy. And you're right to observe that. There's definitely some aggressive deals going around. - Yeah. We haven't talked about risks. We've talked about risk a little bit. What, how do you think about the risk? Is it smart? If there's no, because it's all over collateralized, there's no under-collateralized lending risk. So that is just, is it really just smart contract risk that we're talking about here? - I like to break the risk into three buckets. So three buckets I have are, you've got the risk of bad debt expense. I think that's number one. We'll talk about bad debt risk, liquidity risk. And then it's our contract risk. And those like cyber security risk is kind of the same thing. So like we'll work backwards, right? So when you first talk about the cyber risk, it's like, you know, could the protocols, could the obvious, could the morphos, could they be jeopardized and there could be some critical bond? You know, at this point, with how battle tested, with how lending those are, I don't think that's that big of a deal. But it is something like, you know, that risk is very much there and true. And for all the great work that's on and the beta team have done, like, I'm sure you would agree. That there's like always some level of risk too, even with, you know, the vault contracts that you guys offer. So that's like one layer of risk. Then I would call liquidity risk is kind of the framing of, can I get my money back when I want to? And so this, every vault handles this differently. Some will, like in different protocols, will the, you can only withdraw from the vault if there is liquidity there ready for you at that time. Other ones can say like, oh, there's like a one day wait time and then at that point there, you know, it'll be queued up and then be delivered back to you. So that's kind of like the liquidity risk. Can you get your assets back from the vault when you want them? And then the third and probably most, you know, DeFi native one of these is the bad debt risk. And if we go back to like, you know, earlier in the pod and we're talking about the where is the yield come from, it's ultimately from those borrowers on the other side that are paying a yield to borrow the assets from the protocol. They are posting collateral. And that's why it's over collateralized lending. You know, they're maybe putting down a hundred bucks to borrow out there. If the hundred bucks that they put down, which is in the form of Bitcoin or something, drops precipitously. And faster than the solvers can go out and fill the loan, which is kind of how those things work in the background. Then you could be in a situation where there ends up with what's called bad debt, where the collateral has sunk so fast that it is now lower than the total amount of loans that are outstanding. And the protocol then has to take a haircut. Every borrow lend protocol deals with this differently. Like, Awe has like the umbrella insurance or the umbrella policy. I think is what it's called, something like that. But it's basically you can get paid a yield for being that kind of a stand in that backstop. Back in the day, if you remember like the earliest, some of the one in the earliest borrow lend protocols was actually maker now. And so you remember when it was, you know, users were putting up their eth and taking out dye, but the MKR token was the one that then was the backstop. Right, right, right. So there's everyone's kind of figured out a different way to handle the bad debt. But ultimately that is probably the real risk and why it's different from just, you know, sitting on tea bills. - Yeah, it's a great question. So there's two dimensions to it. You're right then, more diversifying in some sense. It's not always good, right? If you diversify over garbage, you're in a worse position than if you put all your assets in one secure protocol. So that's the like, you know, protocol layer. From a smart, vault smart contract perspective, this is its own like deep subject, right? Like not all vaults are the same infrastructure. They have different trade-offs, they have different permissions, different ways they do calculations. There's a vault exploit this past week from some curve pool that had some pricing issues. So that is something that we think about deeply. And there is to some extent to trade-off between like how expressive these vaults are and the surface area for where things can go wrong. So you're right, like the simplest vault is, it doesn't do anything, right? It maybe sits on top of Ave, yeah. And that's it. And there's minimal smart contract risk, but there's no product flexibility. We've thought about it a lot. What I can say is it exists, but this is why it's super important to be battle tested. It's why we sprinted to get to multi-billion dollar scale and stay that way and prove that our infrastructure is secure. 'Cause you can't put a price on that. - Right. - Well, you're at like almost two billion today, right? - Yeah, and our peak TBL was, it's gonna sound insane, but six billion. - Yeah, yeah. - How did you get the TBL? - The six billion was during the height of plasma, which is not, so you were one of the main plasma. - We were the, we are effectively plasma as well. - You are, okay, yeah. - Huh. How do you think about correlation risk across strategies? So like if there was like a March 2020 liquidation cascade or 1010 or something like that, more March 2020, 'cause it's a little more tied into DeFi, are the vaults actually diversified or do they all blow together? Or is that not your problem? That's on the risk manager to figure that out. I mean, it's our problem in the sense that we're in DeFi and like it's our business, right? And it happens, right? In fact, a couple of months ago, there was a company called Stream Finance, I'm not sure if you guys heard of this. That was kind of a media concentration, yeah. It was one asset, stablecoin. Again, we could talk about that, how people call themselves stablecoins from a tall bullshit, but it went insolvent. And there was a set of morpho markets that users just couldn't withdraw from. They incurred bad debt. What ended up happening was that fear spread to all the morpho markets. And for a period of like, I don't know, 15 minutes or something, not that long, even healthy markets and healthy vaults had liquidity and withdrawal issues. So sometimes it's not just like the economic spread. Sometimes even fear and flood can cause these kinds of disturbances. It's definitely something I think about. It's one reason why diversification makes sense. 'Cause like Abe was fine, right? During that event, maybe there's future events where Abe's not fine and morpho is fine. But yeah, it's really on the risk manager, but you gotta be mindful. - What do you think? Maybe picking on the morpho competitive dynamic there? Like morpho has this, I think morpho has permissionless vaults, right? So like anyone can go to morpho and spin up a vault. You guys have more managed curated strategy. What's the, how do you think about that? Like what, why is that? - They're very different models, right? So morpho's model as far as I can tell, I don't think they're monetizing their vault there. It's just like, it's an instrument for getting capital into the lending protocol. But the lending protocol, I don't know, they don't tell you. - Whereas you guys are just a vault provider. - Exactly, a vault's tech layer. - And this is what allows us to invest in building the best infrastructure, right? Versus, vaults are always secondary protocols, right? They're only as good as they need to be. They're not as good as they should be. - Do morpho vaults allocate to lending pools outside of morpho and no, okay? And then would you guys ever allocate your vaults to morpho even though you compute them on the vaults layer? - You have beta vaults that allocate to morpho vaults. - Interesting. - Multiple morpho vaults, right? Let's say you wanna allocate to two different morpho curators, right? How do you do that? Well, that's available. - It's a beauty of beta, I like your model. That's cool. - Thank you. - That's really cool. Do you get worried about Abe launching native vault products? - I think Abe, everyone's gonna do vaults. But is Abe gonna launch a vault that lets you allocate to morpho or boiler or Pendle or Uniswap? No, they're not, 'cause that's not their business. - Yeah. What do you guys think happens to DeFi TVL as the DeFi Mollet goes like, probably mainstream slash parabolic this year? - I think it explodes. - Yeah. And the question right is, will there be enough borrowed demand on the other side that the yields continue to stay high in competitive? Because this is like, you know, it's like search pricing, right? It's like it's constantly balancing these two things. It would be very wild to me if, you know, all these fintech's launch, we bring in tons of USDC or other stablecoins in. And then the yields start compressing, compressing, and pressing because there's no people wanting to borrow on the other side. I think when that happens, it just kind of spurs the market, like pulls from the market more borrowed products that are built on DeFi and I bet that becomes more and more. You know, maybe also another like hint at what is to come from Kraken and our growing suite of DeFi and on-chain products. But that's, I think the thing I would be looking for and curious about is like, let's say this really does happen. We bring in a ton of incremental TVL. How can the industry then, what, maybe it's like a, you know, Jevon's paradox kind of thing. It's like what then comes of all the new types of lending. And like if lending is super cheap in DeFi, I should just say borrowing. If borrowing starts becoming very cheap in DeFi, what are all the new use cases that will come from that? - Yeah, this is a fascinating. So I'll add to that, which is the user base historically in DeFi has been like 1,000 people. Like realistically, you look at the capital. It's like, you know, Justin Sun and a couple other people. And you get very interesting dynamics. - The amount of teams that was like, how are you going to get your TVL? They're like, oh, like I know someone who's close to Justin Sun. - What is it? - His eminency. - I think he had like a billion dollars in one of our goals at one point. So those dynamics, the markets are very interesting where you have a couple of people. That changes when you have millions of users, when the capital base becomes diversified and more sustainable. I think it's very interesting. You have maybe less of this stuff that we see in DeFi now, this volatility. And you're actually able to build more interesting financial products with that user base. - Yeah, as we think about wrapping up, what do you guys think is one thing that listeners should really pay attention to in the vault space? - I think this trend, you know, I'll just reiterate it. This trend of flexibility and product always wins is something we'll see play out. What Kraken and John are doing is truly amazing. Again, one click and you get all of this DeFi, right? It's not just one protocol, one chain, one asset. You get all of this exposure packaged up into this single, simple, very easy to use product. I think that door only opens and it stays open. - I think the other thing I'm looking for or watching out for is like, what we call an inside of Kraken is hybridization. Like DeFi and FinTech are going to merge closer and closer and closer. And this is kind of what we've been talking about through this episode where DeFi is becoming more back end, more API, more of a tool that's powering all these yields than it is actually its own user interface. And that is, I think, how we 10X the size of DeFi and just on-chain users. How do we get to a billion daily active on-chain users? It's at some point in the future. It's going to be through the apps that are simple, easy to use and fit the same interaction patterns that people are used to. - I just remember one thing that this is its own kind of topic, but we're talking about Vaults as a product tool. But Vaults are actually also a compliance tool. And my view is that in the long run, Vaults will be the only way that institutions, regulated institutions, you know, track find institutions can actually interact with DeFi because you can't just throw capital into this permissionless, you know, open whatever layer. You need to be able to impose your risk control. So I think there's implications on regulation, how DeFi actually gets regulated. I think Vaults are going to play a central role. - Yeah, fascinating. Anything else we didn't cover? - Just that there's a ton more to come. You know, I think this, my hunch of where we are right now is I think 2026 is going to be like a year for the builders. And I think the speculators might need to set this one out for a couple of years until we get back into those times. But this is the time for builders and for builders, for users out there, for people who want a high yield, who want to use Kraken, like please come use the product, give us feedback. We're open to it. We've got a lot more products coming to you soon. And for those who are out in DeFi and who want to plug in to one of the most trusted, secure, well-known, global cryptocurrency exchanges, our doors are open. So please come find us. We'd love to talk to you about any sort of protocol or offering that you guys have, whether it's new vaults, it's new DeFi primitives. This is the big effort. We're hybridizing the exchange. It's one of the big ways Kraken is growing, things like X stocks, bringing stocks on chain. All these different products we're doing. We've got a ton of really, really exciting stuff on the roadmap. So, anyone please just come knock on our door. We'd love to talk to you. - Love it. John, son, thank you guys. - Thanks, Yano. (upbeat music)