Crypto Bank TAKEOVER (2 Altcoin GIANTS)

SPEAKER_1 (0:00)

What if Wall Street starts using Crypto to make loans? That is where Aave and Morpho get very, very interesting. If major institutions decide to move in at scale on these two protocols, our long-term model puts Aave going absolutely ballistic and Morpho even more so. One model tags Aave reaching $844 a token, and another for Morpho bringing it to $9.

And the model only works if the tokens share in the value being created. And I'm gonna show you the math here, but first, we need to see how big this business really is already. And then we'll get to the fun side of things because the bowl case in this is actually much larger. But first, let's say that you own $100,000 in Bitcoin. You need $40,000, but you do not want to sell your Bitcoin, but you could lock this up and receive a loan. Think of this as the lender's backup plan. You pay the interest and the people supplying the money earn the most of that interest. Now, Morpho and Aave help connect both sides of this equation and can take a small toll out of that transaction. These protocols are running the roadway of where these loans are originated. And if your asset falls too far in value, it may be sold to repay that loan you took. That is collateral. Very simple. Today, the collateral is mostly Crypto. Over the next 5 to 10 years, more stocks, funds, and bonds could become usable as backing for these loans on the same systems. That does not mean that every stock is ready today.

The rules have to be clear. The prices must be trusted. And there must be buyers when an asset needs to be sold. So to get these pieces right, lending needs to work 24 hours a day, 7 days a week. And we already know the obvious, that lending is a massive, massive business.

JPMorgan reported $1.5 trillion in average loans in the fourth quarter of 2025 And in that quarter, it earned $25.1 billion in interest after paying for its funding. But before other costs and losses, that includes more than loans. And not every bank loan can move over to Crypto. And the point here is much more simple. Moving money from savers to borrowers is extremely valuable. And now you have to look at something like Eris Capital. It ended 2025 with about $29.5 billion invested, mostly in lending, and reported about $1.3 billion in annual profit. Eris also carries lending risk, so this is not apples to apples comparison. It is proof that credit can become a very large profit engine. Now, Aave and Morpho are not trying to copy every single bank job. Computer code cannot collect every unpaid debt or replace a court, but it can help running a lending system. They can help money move by the rules that are visible, automatic, and always on. And these banks may even use these systems under the apps people already are used to using and already know. And this is not a land of make-believe. Coinbase already uses Morpho. They do this for crypto-backed borrowing on USDC lending, and USDC is a token designed to track a dollar. The customer sees Coinbase. Morpho is running the power of this loan behind the scenes, and that's the entire idea. A familiar app in the front and crypto doing the work in the back. This is the DeFi mullet. And here's the money part. In our example, someone borrows $100 and they pay $6 in interest for a year. Most of that goes to the people supplying the money, and if the system keeps a 10% fee, it gets 60 cents.

Small toll, lots of loans, and that's how these overall numbers grow. And grow they are on Morpho. So now, let's build a potential for where this can actually go, and you have to remember, this is a possible future, five or 10 years out. This is assuming that major firms actually decide to expand the use of these systems. It is not what the tokens are worth today. Now, we start off with around $300 billion of average active loans across both these systems. You give Aave 60% or $180 billion of those loans, and you give Morpho 40% or about $120 billion. That split is only an illustration and not a forecast, but at a 6% average borrowing rate, borrowers pay $18 billion a year in interest. And if that lending system keeps 10% of the interest, they rake in $1.8 billion.

Now, you set aside half for running costs, rewards, and rainy day funds. Assume the other half can benefit the token holders, that leaves $900 million a year. Then suppose investors pay $25 for each dollar of yearly value reaching holders.