Dragonfly's Haseeb Qureshi: The Biggest Digital Assets Bull Market Has Started (Here's How I’m Positioned)

Andy (0:00)

Haseeb, I've came to learn that not everybody was full port near Hype, Lighter and Zek, and that the euphoria that I'm currently seeing, as you can see, is not reminiscent of, or is not shared amongst the whole market. What's going on out there, man? How are you feeling? And I hope you bought those lows with that new fund. Great to have you back.

Haseeb Qureshi (0:19)

Yeah, well, look, I'll say we're feeling pretty good. I think we own pretty much everything that you mentioned. You're looking pretty good. You look like you're in a lot of euphoria right now.

Where are you? What is this look?

Robbie (0:31)

Yeah, I've been in Florida, man.

Andy (0:33)

I've been in Florida. I needed to get out of New York City, and so I figured I would just embrace the old guy sipping the margarita on the beach vibe for the week. You know what I mean?

Robbie (0:43)

Andy took off the penguin and unveiled his true personality here.

Haseeb Qureshi (0:49)

Okay. Yeah, man.

Andy (0:51)

So Haseeb, we have a ton of topics, Hyperliquid and lighter and variational. Obviously, we just got the TGE. We got Kalshi and Polymarket both going through their own scrutiny. We got, what else, Rob? We've got this tokenization super cycle and then obviously near and this kind of privacy growth happening. So why don't we start with the perp side. Variational just announced their TGE day. You guys are obviously early investors there and in lighter and also purchase Hyperliquid, you know, somewhat early with some size from the Dragonfly side. Perps are exploding.

They're still 1% of global derivatives markets. The CFTC is just apparently as of a headline yesterday on Go mode, which feels like a rap song, but coming from a CFTC kind of like comes, official just kind of tells us where we're at.

What's going on with the perp side? How much do you think this trade has left in terms of its legs? Where are we at?

Haseeb Qureshi (1:46)

So for a long time, perps on chain have been one of these missing markets.

And by missing markets, what I mean is that it wasn't obvious in the very beginning that DeFi trading was going to be big because on chain is slower, it's just kind of got these UX crinkles that are going to make it more difficult for people to be able to use this stuff the way they use stuff in traditional centralized exchanges. But once spot trading started to work on chain, we always asked ourselves the question of, okay, where's derivatives? If spot is this big, derivatives should be even bigger because that's how it always looks in every traditional market, is that spot is something like 20 percent of derivatives in any given market once it gets to maturity. So we were back, I mean, this must have been like 2018, 2019 when we invested into DYDX, then we invested into Derivadex, and we invested into a lot of these early attempts at building perpdexes on chain, and they just never worked. The UX wasn't there, the latency wasn't there, the performance wasn't there. It wasn't really until Hyperliquid cracked the code that all of a sudden people realize, aha, you must be this tall to ride in terms of UX, latency, performance, and everybody, it kind of set this pacing that everybody could start to follow as they started sprinting. So we're investors, as you mentioned, we own Hyperliquid, we're early investors into lighter and variational that we invested into, obviously variational pre-TGE still, but they've been growing a lot using an RFQ model rather than using order book model. But all three of them have unique angles of attack on how to go at this purpose market. I think the answer is that largely it's hard to see exactly how the crypto purpose market is going to grow that much because there's only so much crypto trading in the world. It's more like taking market share away from the centralized venues, and you've seen that with Hyperliquid. Hyperliquid is now a meaningful portion of Binance's total volumes, and they've been going up and up in terms of open interest and in terms of volume. But the really bigger story is that crypto trading on the whole is not the tam.

For Hyperliquid, now already more than 50% of their volume is RWAs, and the RWA tam for trading, if you look at the global CFD market, to say nothing of the onshore regulated trading market is absolutely fucking enormous, so much bigger than the crypto market. So the bigger story is that, okay, I'm not trying to be Coinbase, I'm trying to be ICE. I'm trying to be the New York Stock Exchange. I'm trying to be the Nasdaq.