TLDR

In this episode of BidCast, host Jason speaks with Vishal, co-founder of Stride, about the evolution of their liquid staking protocol within the Cosmos ecosystem. They discuss Stride's business model, revenue generation, and the current state of liquid staking in Cosmos. Vishal shares insights on building a decentralized exchange on the Cosmos Hub, the importance of partnerships with Eureka chains, and the strategies for onboarding new customers. The conversation also touches on the alignment with the Cosmos Hub, future goals for Stride, and the execution risks involved in their ambitious plans.

Chapters / Timeline

00:48 Introduction to BidCast and Stride

01:47 Vishal's Relationship with Magnus and Interchain Labs

04:07 Stride's Business Model and Revenue Generation

05:36 Liquid Staking in Cosmos vs. Other Ecosystems

11:19 Future of Stride and Capital Needs

14:13 Building a DEX on Cosmos Hub

19:01 Partnerships and Order Flow in DeFi

25:12 Building on Cosmos Hub: Opportunities and Challenges

26:44 Fee Structures and Revenue Models

28:10 Aligning Stride with Cosmos: Revenue and Tokenomics

29:09 Defining Success: Milestones for Stride

31:27 Business Development: Strategies for Growth

33:21 Onboarding and Customer Engagement

34:03 Liquidity and Market Dynamics

37:23 Competition and Collaboration in the Cosmos Ecosystem

40:02 Investment and Alignment with ICF

42:12 Improving Token Liquidity and Accessibility

45:40 Future Products and Execution Risks

Transcript

<< Jason Kam (00:48) >>

⁓ All right, we are ⁓ live. ⁓ Welcome to another episode of BidCast. I'm your host, Jason Kam, aka at Maple Leaf Cap. Today is April 11th, 2025, noon Hong Kong time. BidCast is being livestreamed to BidClub members. Questions are from the members and my own. We plan to only cover liquid tokens and Web3 related equities in this podcast, where participants may own the instruments discussed.

All opinions are our own and Bid Club is not being compensated for the content produced. Nothing we discuss is investment advice, nor do we believe there's any material non-public information in the episode. Today I'm speaking with Vishal, the co-founder of Stride. Vishal, welcome.

<< Vishal (Stride) (01:30) >>

Hey Jason, thanks so much for having me on. Super excited to be here.

<< Jason Kam (01:33) >>

Yeah, man. Why don't you tell us about like a, the a relationship with Magnus and Interchain Labs, who seems to be running Cosmos Hubs these days. How do you get to know him and like, what's your working relationship like?

<< Vishal (Stride) (01:47) >>

Absolutely. Maybe to start, run, or I was one of the co-founders of Stride, a liquid state protocol in Cosmos. We launched like three years ago. We actually were founded, I think within a month or two of when Skip was first founded, or at least publicly announced. Skip was Mag and Barry's company that got acquired by the ICF. So this was in like March of 2022, maybe. And then September of 2022, and then we first met them at Cosmiverse. So was right when Stride launched.

<< Jason Kam (01:53) >>

Hmm.

Hmm.

<< Vishal (Stride) (02:14) >>

Skip was just getting off the ground. They had like a med client that was getting like pre rapid adoption Started talking then but we didn't have a professional relationship at the time that just I know we're around the same age Just started companies in Cosmos. We were super excited the space and kind of a lot of them shared goals outside Then maybe like six or twelve months later skip started expanding far beyond them and doing a bunch of like IBC stuff I'm gonna start doing stuff for relayers or just generally consulting with teams for how they can improve the UX across chains

<< Jason Kam (02:37) >>

Hmm.

<< Vishal (Stride) (02:42) >>

We started working with them then on some Stride, like tokenomic stuff. So we're thinking about ways we can use the revenue ⁓ and in particular, could we like swap the revenue for Stride. At the time it was just kind of hard doing Cosmos because all the DEXs are on different chains. So we started working with them there on that. Then over the years we worked with them quite a bit on IBC stuff. They've done quite a lot of upstreaming to the IBC repo and ⁓ 70 % IBC traffic is run by Skipco today. And Stride is one of the largest IBC consuming chains.

<< Jason Kam (03:07) >>

Hmm.

<< Vishal (Stride) (03:11) >>

So we have lot of work on kind of the IBC layer and then SkipGo also. We've done quite a lot. We integrated to the Stride website, giving feedback on it. It's their primary front-end widget and we've worked with them to integrate all of Stride's features through that. So it's been kind of a long journey. would say the first year was maybe more social and we worked together over the last few years. But over last six months, we've been working together super closely, probably talking every day or two about Stride's new endeavor with the Cosmos Hub and kind of what their dreams are for Atom and how

<< Jason Kam (03:29) >>

Yeah.

Yeah, I mean, we just spoke with them. And they basically asked 90 % of the workforce took IBC in-house and then basically chopped all of the external vendor relationship. And do you feel like they are sort of labor constrained at the moment? They have to outsource a lot of work to folks like you and co-building things together? What's the working relationship like now that he's sort at the helm of ICL driving value to Atom

<< Vishal (Stride) (04:07) >>

Yeah, yeah, absolutely. think they are, they're nothing constrained, although I don't know if it's labor constraints, they actually, I think, inherited quite a large number of people at the ICF and ICL and with the ABC teams, the Cosmos teams, et cetera. My sense is they're really trying to focus in on a few core goals, like when they kind of were, took over the ICF leadership, they have a, they have like kind of an uphill battle, know, Atom had been, they had been struggling for a while, there was like a, not a clear product direction.

There's a lot of a discontent outside the ecosystem. I think they are, truthfully, they've been quite effective. I think they're trying to do a very targeted plan on like three big things or two or three big things they want to ship, focus entirely on that. And I think they actually have more like shrug the organization to focus just on those goals. And I think as a result, they're trying to delegate like other sub tasks to other teams. like, for example, like in our case, they know they want a lot of swap flying right through the hub, but they don't think they have the ability to like take that on when they're also kind of

<< Jason Kam (04:40) >>

Hmm.

<< Vishal (Stride) (05:06) >>

evangelizing the ecosystem. And so that's what we're on the left.

<< Jason Kam (05:09) >>

We'll talk about that in just a second. And on the Stride's core business today, if I'm not mistaken, you are deleting restaking protocol on Cosmos today with about 40 million of TVL. Yeah, go ahead. Liquid staking, sorry. 40 million of TVL, just about.

<< Vishal (Stride) (05:11) >>

Yeah, bye bye.

Yeah, one small thing, liquid staking, not resaking. Yeah.

<< Jason Kam (05:36) >>

Yeah. Walk me through how does that ⁓ 40 million TVL sort of translate into fees to the protocol.

<< Vishal (Stride) (05:45) >>

Yeah, yeah, we have a very simple business model. Basically, you can think of it as the same as LIDO. Every six hours or so, the protocol accumulates staking rewards from all the tokens that are staked. 90 % of those get sent to get reinvested and get auto-compounded back to the LSD holders. 10 % gets taken as a fee to Stride. The vast majority of that revenue gets used to buy and burn Stride. About 15 % gets used as payments for security for the blockchain.

<< Jason Kam (05:58) >>

Hmm.

Yeah, so the math is ⁓ 40 million TVL. It's mostly $Atom at the moment.

<< Vishal (Stride) (06:16) >>

Yeah, the are largest token, but we have 15 different LCs, but like $Atom, $Tia, $Osmo, $DYDX, that's the majority.

<< Jason Kam (06:23) >>

OK.

And the blended yield is like 10 to 15%, just about. OK. So 40 million times 10 to 15 % yield times 10 % tick rate ⁓ times 80 % sort of fee capture to stride treasury itself is about ⁓ half a million of run rate revenue. Is that right?

<< Vishal (Stride) (06:27) >>

Exactly. Yeah.

Yeah, right around there. think it might be around 450 like fairly than 7 day average if I remember correctly. But it fluctuates a little bit. Some of the yield is real yield from protocols like DYDX or osmosis for example. But I think it should be right around 450 to 475 right

<< Jason Kam (06:56) >>

Mmm.

Got it. And I guess that's revenue going directly to ⁓ token holders through DirectBot.

<< Vishal (Stride) (07:07) >>

Exactly. Yeah, yeah, it's flyback and birds.

<< Jason Kam (07:10) >>

Okay, so how do you fund yourself then?

<< Vishal (Stride) (07:12) >>

Yeah, we have been pretty fortunate. We had a super round like three, ⁓ almost three years ago and then we've done one initial round of financing off of that and then the ICL is giving us some financing right now. So, entirely funded through token sales.

<< Jason Kam (07:19) >>

Hmm.

⁓ sorry. ⁓ From previous rounds and then plus ICL's grants. So you kind of don't have to sell tokens in the open market to sort of pay for it.

<< Vishal (Stride) (07:38) >>

Exactly, I just want clarification that ICF not ICL misspoke. ⁓ Yeah.

<< Jason Kam (07:42) >>

ICF, okay, yes, very important. Magnus was

⁓ very keen on telling me that it's different entities and sort of independent decisions. Okay, that makes sense. And do you give away any incentives at the moment of stride to the stakers?

<< Vishal (Stride) (07:49) >>

Yeah, yeah.

Yeah, it's a great question. So, stake is going to a little bit. It's never been very inflationary, so it's around, I think, 2 % stake and yield with like around 2 % inflationary as well.

<< Jason Kam (08:08) >>

So it's not that much. So people are really getting what they get from the base layer. OK, that makes sense. I I guess one question that people are always wondering is, mean, Ethereum, I forgot what the number is. It's like a 30%, 40%, 50%. A very high percentage are not only staked, but they are done through things like LIDO, whereby for every other ecosystem, including Solana, I mean, like,

supposed to talk to Sanctum, but everybody else is like extremely low liquid staking. Why do you think that is and do you think there's ever chance of getting it up?

<< Vishal (Stride) (08:44) >>

Yeah, no, it's a very good question. And I think we've seen almost the first counter example recently because of the parachain. And I think it's actually somewhat consistent. With Ethereum, I think there was a lot of historical reasons for Lido. So when Lido came out and launched $StETH it was basically very difficult to actually save $ETH at the time. For a retail user, was basically inaccessible. Even for most institutions, it's from a security perspective, infrastructure required, 32 $ETH minimum.

<< Jason Kam (08:50) >>

Hmm.

<< Vishal (Stride) (09:11) >>

The fact that staking and the kind of versus associated were a little bit like, I would say complicated or opaque to a lot of like fund managers. A lot of people like, you know, use Lido then. And then now that there's so much adoption and so institutional, ETH has by far the most vibrant DeFi ecosystem. That has kind of led to a huge adoption of ETH and it's kind of used kind of throughout DeFi. For other ecosystems, staking is much simpler. Mostly because they've developed it or iterated on it.

<< Jason Kam (09:21) >>

I see.

Mmm.

<< Vishal (Stride) (09:39) >>

And so you really don't have to use LSTs unless you want to participate in DeFi. And right now, think most chains, like the vast majority of tokens are not in DeFi. They're kind of held on CEX's or held in regular wallets. So we see typically, I think, like 5 % liquid staking rate for most ecosystems. The one exception I would say, though, is Bera chain. I think for two reasons. One, it is quite hard to stake your Bera And as a result, doing it through liquid staking brighter is much easier.

their whole ecosystem is entirely geared around DeFi. So even the tokens held by ⁓ like investors or insiders are often deployed in DeFi. And I think we've seen huge,

<< Jason Kam (10:20) >>

So do you expect that for cosmos like I think it's like 2 % liquid staking do you expect a number to go up meaningfully in the future? Is it pretty difficult?

<< Vishal (Stride) (10:28) >>

Yeah, I think it can go up to like maybe five to 10 % if DeFi goes up. Cosmos has a very immature DeFi market relative to other ecosystems. And think we're getting into parity, I they'll get that number up. To get really high numbers though, like we see on Ethereum or elsewhere, I think we'll have to see some real innovation on the LST layer or some big increase in trust. And those are two things that won't go back right now.

<< Jason Kam (10:48) >>

Yeah.

And

people are staking themselves on Atom is pretty easy. Just go to the hub and go cap. You probably have to see some Ponzi Pool 1 and Pool two games being played with the sort of liquid stake.

<< Vishal (Stride) (10:56) >>

Exactly. Yeah.

Yeah, or

if it's something like you can use the  tokens in DeFi product early maybe to earn fees or something, then there's an additional reason to stake. But in general, think for most dollar scenes, they're very restrictive to just DeFi.

<< Jason Kam (11:11) >>

Hmm.

Do you foresee yourself ever needing capital by selling ⁓ tokens in the market or raising? I think you raised $12.2 million over time through three rounds of fundraising plus the grant from ICF. ⁓ You're self-sufficient, I'm guessing for a while with the burn today.

<< Vishal (Stride) (11:33) >>

Yeah, exactly. think our hope is to never have to sell stride tokens in market. We've never done it. as a company, none of the founders have ever done so either. I think it's something that has a kind of big implications. You should be really confident when you want to do it. I don't know if the protocol is at that level of maturity yet. I'm pretty lucky, I think, to be able to take lots of funding from investors who have long locks and are willing to support us.

And the hope is that the protocol becomes much more revenue generating and we can use that revenue to fund operational expenses. We're a pretty lean team, this should be feasible. We were actually cash flow positive a little bit earlier this year, but then token prices have gone down quite a bit and yield's about a little bit as well. But even when we cash flow positive, then the revenue went to the labs or financial entities. But in the future, revenue's higher and we've got certain tented path to sustainability.

<< Jason Kam (12:28) >>

Sorry,

and 80 % goes to burn, but 20 % goes to team. at one point, cut.

<< Vishal (Stride) (12:34) >>

No, this is actually 20 % goes to Atom basically for providing security. Yeah, so none of it goes to the team.

<< Jason Kam (12:39) >>

Hmm.

I see. So how do you break even?

<< Vishal (Stride) (12:45) >>

Yeah, maybe a misnomer. I spent like the total revenue of the protocol was ⁓ higher than total expenses, ⁓ like development costs, but we didn't actually like carry it through.

<< Jason Kam (12:53) >>

Ah, OK.

OK, but you're still expensing salary. But I guess that's OK, because you still have a huge war chest plus the grants. OK, and in the next two or three years, you'll be OK, even if you step up the number of staffs.

<< Vishal (Stride) (13:04) >>

Exactly, yeah.

Yeah, think next year's we should be okay. And then the hope is that ⁓ with this new partnership, we can start generating some more revenue and then we can also use that to extend our own.

<< Jason Kam (13:19) >>

Yeah,

yeah, yeah. That would get to the really exciting part because half a million, I mean, the step up from 2 to 5 to 10 % of liquid staking percentage is, we will see. I don't know if Atom's going to pump so that like the 40 million turning into half a million of revenue. I don't know if that's going to like materially change in the future. But I think what's the most exciting, and correct me if I'm wrong, is that ⁓ because of the management change that happened with Magnus at Atom,

And because they need a lot of things being built in the Atoms Cosmos Hub, namely the DEX, the Liqudity Staking, the Lending, whole DeFi ecosystem. ⁓ Tell me more about your relationship with them and whether they're enshrining or levying some real growth effort that Stride is actively working on that may not be known by the market.

<< Vishal (Stride) (14:12) >>

Yeah, absolutely. So it's just got announced very recently. We've been working with them super closely to build a DEX and kind of a whole DeFi suite on the Cosmos hub. Maybe a little bit on the goal there and how much of it is like in try and make, how close are you working with them. The goal from them, I think they've announced Eureka last week. That's been like a big product release. Like the hope is there's a lot of liquidity on Ethereum, Solana, a bunch of other chains.

they can bridge over to these new Cosmos chains like Babylon. It seems like a very compelling product offering. have like 10 or so customers already, all of which are very large chains, bunch more on pipeline. But to enable that, I think they need a high quality DEX on the Cosmos hub in order to be able to actually bridge volumes over, be able to swap from token A to token B, and also to help to strap up the DeFi ecosystem on the hub they're trying to help build. we've been about this vision for quite a while and we're pretty excited about it.

<< Jason Kam (14:49) >>

Hmm.

<< Vishal (Stride) (15:08) >>

they wanted us to kind of build the stacks on the Cosmos Hub with the goal of serving these Eureka Chains. So that's kind of like what the original intent was. And then maybe a secondary goal is also to help kind of bootstrap the C5 ecosystem on the Cosmos Hub. In terms of kind of how the relationship actually goes, we work with them pretty closely. This is predominantly in like a goal setting, I would say, or kind of aligning on what's important to focus on. We talk with them quite a bit about what their vision is for Atom, who they see as the users in the first 90 days, first...

six months, one year, how can we help unlock those users? How can we help optimize the product for those people? We do that pretty close to them as well as kind of get technical help. We've had a number of years experience with Cosmos SDK, IBC, et cetera, to help out if they're blocked on something there. And in return, we get to be super close to kind of what they're thinking, what they're deploying, get really close to who the users are and who we're trying to build for.

And in that sense, we are very closely kind of working with them, know the roadmap, kind of help guide that roadmap. But it's not enshrined meant that ⁓ no one else is allowed to build a dex. Like anyone can come build in the Cosmos Hub. I don't think they're opposed to supporting other dexes either. I think that partnership with us is they really have ⁓ an acute need for a very high quality dex, and that's like, you know, immediately actually, to help serve these users. And we want to help do that. But it's not that... ⁓

<< Jason Kam (16:10) >>

Hmm.

⁓

Hmm.

Hmm.

<< Vishal (Stride) (16:35) >>

No other DEX's can exist on the Cosmos hub.

<< Jason Kam (16:37) >>

Very clear. then this will be like a Uniswap v2, v3, v4 type of equivalent.

<< Vishal (Stride) (16:43) >>

Yeah, we're hoping to do right now is for community  and then we're doing a bunch of kind of extensions on that to add a lot of kind of constant features.

<< Jason Kam (16:52) >>

And the difference between that and osmosis is what ?

<< Vishal (Stride) (16:55) >>

Yeah, great question. They're quite different. So Osmosis is kind of a L1. It's built in the Cosmos SDK. And almost all the swapping logic happens on natural protocol layer. So you've got natural code that binds the blockchain together. As a result, they do a lot of custom stuff. So their chain can do all sorts of custom types of training strategies or CL deployments, wherever it is.

<< Jason Kam (17:08) >>

Hmm.

<< Vishal (Stride) (17:21) >>

But on the flip side, you can actually like plug into lots of other applications. So in particular, Eureka, because it all goes through Cosmos Hub, that flow can't go to Osmosis and that can kind of only be internalized by the Cosmos Hub ⁓ and like other DeFi apps in the Cosmos Hub. It's much easier to make like a call to smart contract lives on your chain, as opposed to having to do some bridge to another chain, get funds back, whatever it is.

<< Jason Kam (17:42) >>

And

when they turn it on, mean, Magnus is pretty shy about this, but Rabi, Phantom, MetaMask directly to you, Kepler still cost me my set. that the way to think about this?

<< Vishal (Stride) (17:56) >>

Um, so there weren't, I'm sorry, I think I quite follow.

<< Jason Kam (17:58) >>

Like basically, ⁓ can I use Rabi and MetaMask with your DEX?

<< Vishal (Stride) (18:03) >>

Oh yeah, oh yeah,

yeah, so sorry. Yeah, I believe so. I think that's the exact timeline on this is a little unclear and they're kind of working through it. But the hope is that this should be, the customers are using all sorts of wallets. The hope is that they're bridging people from Phantom, MetaMask, over to all sorts of really niche wallets. And the hope is that we can be supported by this goal of native integration. So your assets in the Cosmos Hub, yeah.

<< Jason Kam (18:07) >>

Hmm.

Hmm.

<< Vishal (Stride) (18:32) >>

Yeah, yeah, so yeah, it's a great question. So two fronts. So one, we're working with them on kind of using their treasury to help like bootstrap DeFi. They're still kind of trying to work through, I'd say with the legal team on what exactly they're able to do there. But we're I think tightly aligned on the goal of that they have a quite a large war chest and they really want DeFi to happen very soon. Working that pretty closely on like how they can kind of help make that happen.

And then the second thing is on that's all order flow. So I there's two ways order flow we're helping to get from our that we are getting from them. So the first is ⁓ order flow from Eureka chains. So people are swapping, you know, from Eureka, we'll be in the Dex and the Cosmos hub. That's going to be the centerpiece for all these transactions. We can process all that swapping. And the second is they run Cosmos Go, which is the largest IBC aggregator ⁓ or Cosmos aggregator. It serves a whole bunch of chains. If you guys haven't checked it out, definitely go check it out. ⁓ IBC off on.

<< Jason Kam (19:01) >>

Hmm.

⁓

<< Vishal (Stride) (19:31) >>

Yeah, it's great. You can swap from any chain to any other chain. But we're doing a preferred partnership with them there. first, any swaps that go through there, if we have competitive execution price, because the UXs are being better for users, a lot of those swaps will go through us. They do around 70 % IBC volume today.

<< Jason Kam (19:50) >>

that's interesting. That's the skip go. That's basically, that's what it is.

<< Vishal (Stride) (19:56) >>

Yeah, it's skip go. I would say it's like the canonical front end for skip go, although people can also plug into skip go through an API. Yeah.

<< Jason Kam (20:00) >>

interesting. so

walk me through. ⁓ So what your DEX is live and running, let's say they see that it was like 50 million TVL, just for example. And ⁓ let's say for whatever reason, I want to swap from Solana, like Sol, and directly to ⁓ USDC on Osmosis, for example. And I'm hooked up with Eureka. In my mind, the flow goes like through Eureka.

The Solana gets bridged onto Atom Cosmos Hub, aggregated through, swapped through DEX of the Cosmos Hub's choice, and then through IBC bridged to Osmosis as USDC. Is that a right way to think about this?

<< Vishal (Stride) (20:48) >>

Exactly. the one caveat is that's like the intended path and that's the path that will have the best UX for users, like fastest thing, least number of transactions. But if the execution price is bad in that route, like let's say like you're trying to go from shiba inu coin over and it's like, actually, we don't have good liquidity on that. Then I think I'll fall back to whatever like the best taxes that gives you that price. But there's some trade off there on UX and price.

<< Jason Kam (21:01) >>

Mmm.

I see. So if Osmosis, for whatever reason, basically forks Eureka with their own treasury, and they can also Hulk it up with Solana, then basically the Eureka bridge would not sort of... It might prioritize Atom, but it doesn't have to. It could just like hop. then in that case, your DEX on Cosmos Hub would not get the volume.

<< Vishal (Stride) (21:36) >>

Yeah, it's a great point. if there's like someone that wants to spin up like other liquidity for these types of things, and then we don't do a good job of targeting well, we don't want users to go through our DEX like if they're getting a much worse price, you know, it's worse for them, they're not going to like the product, not going use it. But this exact case, think is not really possible to happen. And the reason is, Eureka is like a combined product offering with ⁓ the ICF and Atom. And so it's the bridge over to Ethereum or Solana, etc.

<< Jason Kam (21:48) >>

Hmm. Hmm.

Yeah.

<< Vishal (Stride) (22:04) >>

But it's also a bridge to your chain that you agree will kind of be canonical. So let's say like, Babylon signs up for this, they kind of agree that this bridge over to Adidas is canonical and they'll use the skip go routes and, or think Cosmos go rebranded routes and market makers, et cetera, to help you onboarding flow. If Osmosis did like another IBC connection, I think this aggregator would just ignore it because it treats only this route as canonical. ⁓ Does that make sense?

<< Jason Kam (22:19) >>

Mmm.

Hmm.

⁓ And let's say there

are a lot of DEX that's being sprouted up. I doubt they're going to get the same level of TVL as you do. But let's say they get some TVL. And then through Cosmos Go, some volume gets routed over. And let's say it is a transactional volume. ⁓ That's when you get paid. OK. And what does a preferred partner mean in that case? Because it would seem like they would just split the order flow based on the fill.

<< Vishal (Stride) (22:48) >>

Exactly, yeah.

Yes, so I think they ⁓ will split the order flow based on the fill if the fill is sufficiently bad. But preferred partner I think is, ⁓ there's like a, the optimization for a aggregator I think isn't always just like cheapest or best execution price. They do like some mixed weighting of like speed, UX, ⁓ maybe like number of transactions to user. They don't have to like some aggregators that they do obviously just do best price like Jupiter.

<< Jason Kam (23:13) >>

Hmm.

<< Vishal (Stride) (23:23) >>

doesn't make sense to consider this like all the swaps are atomic, you know, just give you the best price for them. have like some ⁓ goal there. And so for us, because we're kind of heavily optimizing around the UX here, ⁓ we're hoping to build around the Eureka chains. And then the preferred partnership is if our best price is within a tight band of the next best option. let's say there's ⁓ making up a number here, but 10 basis points or 20 basis points of the next best option. But because the UX is better with the preferred partner, we'll still get that flow.

<< Jason Kam (23:42) >>

Hmm.

Hmm.

⁓ OK. So it is quite nice. And is it on paper anywhere, or is it just like we like each other? That's why we're offering to you?

<< Vishal (Stride) (23:55) >>

Yeah.

Yeah, so we've kind of put together docs and sent this through. Some of this I think is everything's written down. I say we're very in tight sync around what we're trying to do here. And not all of it, I think can be like.

<< Jason Kam (24:13) >>

Hmm. Hmm.

Disclosed Interesting. ⁓ And how soon do you think this will be live? The product that you're building, like the first, like when is the first dollar of swap? Because IBC, your hair's already live, right? So like when is it going to flow through your product?

<< Vishal (Stride) (24:20) >>

Yeah, exactly.

Yeah, so we're pretty much just sprinting right now to get this out. This is our top goal. Our hope right now, we're targeting two months to get everything done. It's gonna be like, there's these number of contract changes on the backend and then fully above out front to make sure everything works for Eureka. There's some uncertainty in there though, mainly because there's kind of a number of moving parts here around like IBC, mean Eureka's SR milestones and ASPSTAR and software upgrades in the hub. So everyone's targeting two months, but.

<< Jason Kam (24:39) >>

Yeah.

Hmm.

<< Vishal (Stride) (25:02) >>

I think two to three might be like a safer time.

<< Jason Kam (25:05) >>

And are you aware of any other Dexs that are doing similar things on the Cosmos hub?

<< Vishal (Stride) (25:11) >>

⁓

Yeah, I'm not aware of others on Cosmos Hub. There is an early great team called Ellis that is working super close to the Cosmos Hub. They have like a whole DeFi suite, so they like, they also do Spot, but they're also their own chain, just kind of send around Atom. ⁓ So far we haven't heard anyone else kind of building, specifically on the Cosmos Hub . Although I think given the Eureka just launched and there's kind of all this excitement, it's inevitable.

<< Jason Kam (25:26) >>

Yeah.

Yeah. And then the fee structure. And to be very clear, ⁓ there are three types of flows that could happen. The first type of flow is ⁓ the transfer. So like USDC on Solana to Atom, you will not get that. It's just done. The second type is sold to USDC, go on your hub, your chosen body, Cosmos Go aggregator, and you get the fee. The third type is for some reason people want to ape some coins.

And because you are the largest DEX, they ape on you, and you also get the fee. On the latter two cases, what kind of fee structure should we be thinking about here?

<< Vishal (Stride) (26:14) >>

Yeah, I think we're,

we haven't finalized anything, but we're thinking right now it's kind of mirroring osmosis. That's what lot of osmosis users are familiar with. It seems pretty healthy and sustainable. they have good market share and also pretty healthy revenues. That's something like 10 basis points for most swaps, but with certain pools having fee discounts, depending on how strategically important they are, or if there's like promotional period or something. The one additional thing I would add is on top of these two, the three users outline, I there's also two other kinds of users that I'm imagining.

One is just the aggregator users. So people who are just like generally using aggregators to move around ecosystems, a lot of that I think we'll also capture. And then last is, I think we're hoping to be the most like Atom aligned DEX. So anyone who's, you know, been in Cosmos for a long time or is like a real Cosmos OG, we're hoping to make kind of a really great product for them and will be the place that they, and a big part of that is that we're really trying to make Atom and Stride very value aligned. And so a good portion of Stripe revenue will be used to buy and burn Atom using the DEX will help.

<< Jason Kam (26:47) >>

Hmm.

Hmm.

Yeah.

<< Vishal (Stride) (27:12) >>

know, use Atom as transaction fees. So trying to get that in line as well.

<< Jason Kam (27:16) >>

Mm, OK. And those are really good points. I want to get to them one by one. So if it's like a 1 % pool, you will charge 10 vips on top of it, effectively, kind of. OK, OK. And then of the fee that you accrue in those volume, how should I think about the split of that to your team, the stride, and Atom?

<< Vishal (Stride) (27:27) >>

Yeah, yeah, exactly.

Yeah, so right now I would say the majority of it will go to Stride token, most likely Buy Back and Burn, although possibly Buy Back and LP, we're kind of actively evaluating the two and listening to people's feedback. And then the other minority of it, but still a healthy chunk, will go to Buy and Burn Atom, or Buy and LP, I think they kind of defer to Mag and Darian, what they think is best. Right now none of it will go to the team. I think the hope is that we'll get

<< Jason Kam (27:52) >>

Yep. Yep.

Hmm.

<< Vishal (Stride) (28:10) >>

the DEX to large-mess profitability, like even Osmosis has, I think, around $10 or $12 million a year in revenue. It fluctuates quite a bit, but ballpark there. We're hoping that it kind of takes a small chunk of this out to cover kind of operational expenses, but nothing's proposed yet, and I think we're hoping to only do it if and when the DEX is successful.

<< Jason Kam (28:22) >>

Hmm. Yeah.

That makes sense. What's it going to be called? You don't have to tell me if it's still in the works.

<< Vishal (Stride) (28:35) >>

⁓ yeah, yeah.

It still doesn't work. I'd say we're like 98 % there, but like not everyone's fully happy with it. So it might change. ⁓ but we'll see.

<< Jason Kam (28:41) >>

Yeah, yeah.

Yeah, fair enough. think

coming up with a name is always the hardest. Funny enough. ⁓

<< Vishal (Stride) (28:49) >>

hard yeah we also have a lot of

stakeholders right so it's like a lot of people in the stride team you have a lot of people who and everyone feels strongly about names a lot of people on stride side but then also people from the cosmos community or the ICF a lot of people have lots of thoughts and so there's a lot of good ideas but it's hard to pick one

<< Jason Kam (29:02) >>

Hmm.

What would success look like to you if this product works? What would make you happy? Any milestones that you're thinking about that? Yeah.

<< Vishal (Stride) (29:17) >>

Yeah, yeah, absolutely. I'd say, like, probably like, there's some tiers, like some stages. Early on, we'd be very happy if we sort of like the majority of Cosmos users. And that's like our first goal. So I users who have wallets and Cosmos chains, where are they swapping spot? If we're the place the majority of them go, that's a huge first win. And they can get there early on like that, which we'll do shortly after launch. That's kind of our goal. Pretty soon after that, think our hope is to just process a ton of volume.

I think by end of this year we're hoping to do something similar to what most of us do today. I something like generating something like 10 and 12 million a year in revenue. The volume would depend a little bit on the fees, but they do something like 30, 50 million a day, something like 2 billion a month. I think we're hoping to get something like that pretty, hopefully not by the end of the year, but this year. And then after that, think a lot of our growth from that point, I would say that's kind of us.

<< Jason Kam (30:08) >>

Hmm.

<< Vishal (Stride) (30:14) >>

growing into and winning the market that we're in. And I think from that point, a lot of the kind of milestones that make us happy is growing one, the DeFi ecosystem on the hub, but I think more importantly, the Eureka ecosystem. And the second one is probably going to be a big part of our focus. So how can we get like more and more big customers to join Eureka? How to make the value prop bigger? Ultimately, every customer is like just more volume and more users for us. So I want to start dominating that. I think that the next goal there is really like

get the Eureka, like, IBC ecosystem to be the largest bridge in crypto. Like Max said, do 20 billion a month and a bridge volume from that. And then our fees can be, I then the Cosmos Hub would really be like a router for all of crypto and there's tons of value being created and lots of fees to generate there.

<< Jason Kam (30:57) >>

Hmm.

Yeah, you touched on a couple of things. One of them is ⁓ serving as BD function for Cosmos Hub slash Eureka. And the second part is potentially more DeFi products beyond just a Uni v3 fork that you did. Can you expand more on that? How is your BD approach going to be different than Maghnus's? And then when you talk about, it's probably like at least you're down a road when you build products, but what would those products look like if you were to build?

<< Vishal (Stride) (31:26) >>

Yeah, totally. I think at least early on, very much focused on the DEX, but trying to help like whatever needs these teams might have. So part of the BD function I think is also just like, you want more salespeople to kind of like hype up the value that you're making them bring. So Mag and Alexi do a great job on that, kind of follow on  that. But then, specifically on the DEX side, I think a lot of chains have a lot of like onboarding, huge pain point. Like there's basically been like only a handful of times in crypto, they can onboard onto an app and it's been like

reasonably easy. I think it's always a big drop off point for chains. We're hoping to kind of help make that good for those people, or those chains. So think about what are the tokens people are going onboard on? What's your launch date? How much volume should we expect? And then we have liquidity we want to deploy, and we want to use that specifically to help that onboarding for those chains. So that's a pain point we want to solve right at chain launch. Establish a partnership early, help as an ongoing basis. Here's what onboarding and offboarding flows you're seeing.

<< Jason Kam (32:21) >>

Mmm.

<< Vishal (Stride) (32:26) >>

or is it make that even easier for users? That's one thing. And the second is trying to find like other things we can do that will make the DEX like win for the other chain as well. This is little bit harder to do, I think, but we have a few ideas. So one thing is I think for all the Eureka chains, we haven't fully finalized this, I think something like this we will do. ⁓ Using something like half the protocol fees on those pools. So let's say Babylon, like the baby pool, use half those fees to buy an LP, the baby token.

drives alignment with that chain, like half the fees there going directly to help improve  for them. And also helps the stride DEX, like now we have protocol and liquidity on the chain, helps make us a bigger trading money for those teams. Yeah, and then we're hoping other stuff as well, like incentive matching. So like if other teams are willing to do incentives, we'll match them either with stride token or maybe like redirecting some protocol revenue, ⁓ might do like custom features for these teams. Mainly, we're thinking is there's so much leverage on the first 20 Eureka customers.

<< Jason Kam (33:03) >>

Interesting. ⁓

Hmm.

<< Vishal (Stride) (33:21) >>

We want

<< Jason Kam (33:22) >>

Hmm.

<< Vishal (Stride) (33:22) >>

to do everything we can to land those. Once you build those network effects early on, you get a ton of value from them during a lot of usage. And then every subsequent sale is much easier.

<< Jason Kam (33:31) >>

Do you have enough bodies? Do you do it in separation of the effort that Maghnus is doing? Or are you doing it together? Or are you all in the same group? How does that look like in reality?

<< Vishal (Stride) (33:40) >>

Yeah,

probably combination. My guess is they probably have tons of meetings without us, you know, like, and then when they want to talk about things like liquidity or how onboarding flows will go, we're much more involved there. And then we'll have separate conversations to take that further.

<< Jason Kam (33:50) >>

Let's wink it.

Got it. And so the next 12 months, the focus would be this bridge and just onboarding customers plus DEX, effectively.

<< Vishal (Stride) (34:02) >>

Exactly. Yeah. And on my mind, they're very similar. We're really focusing on the onboarding part of the funnel that's around the DEX and particularly like how can the DEX really like enable these flows? Maybe to give you like one example of kind of what we're thinking. We've been doing a lot of digging into like the aggregator volume in Cosmos and what retail users do. So looking at like a breakdown of different types of trades, like what tokens do users trading into and out of what, what sizes.

<< Jason Kam (34:09) >>

Hmm.

<< Vishal (Stride) (34:28) >>

And our hope is that we're striking a bunch of like deals for liquidity with the different entities and then we're hoping to deploy those specifically for These kinds of trades so hoping to do like the same thing here for the re-recover volume So you think of like what types of bridging block are we getting? Okay, it's usually under $5,000. Let's make sure we always have $5,000 at the best data-price and can deploy a bit more smartly there and it might be like it might not be like

<< Jason Kam (34:42) >>

Hmm.

Hmm.

<< Vishal (Stride) (34:56) >>

very value generating as an LP, like might be like pretty even. But think of it as the loss later to make the DEX more profitable or attract more usage.

<< Jason Kam (35:04) >>

And are you going to give stride incentives? OK, yeah.

<< Vishal (Stride) (35:10) >>

Yeah, we will, not not not not not terribly many. In the past, I think we've been more liberal than incentives and they work sometimes than other times. think our takeaways like, yeah, our takeaways. I think there's times we have like a flywheel that seems like it is working. And then the incentives really help you to help choose that. But oftentimes, you might have something that is really not like a very effective product and the incentives are not helpful there. And then we're hoping to first like

We ⁓ are pretty lucky, I say, because we have some low-hanging fruit for flow or volume that we can get from all the wraps on Cosmic Sub or Eureka. ⁓ From that, think, hoping to get some sense of what features are impactful or driving more volume that would make sense to internalize.

<< Jason Kam (35:56) >>

So you don't plan to use stride as the LP pair or something, right? But there might be atom incentives.

<< Vishal (Stride) (36:01) >>

No, no, no.

⁓ It might be stride incentives too, but think they won't be like a huge amount of incentives.

<< Jason Kam (36:09) >>

Because it seems like it's an interesting place to ⁓ use, know, like, staked atom that is stride as the base pair. That kind of force, I don't know if, is that part of the plan?

<< Vishal (Stride) (36:23) >>

Yeah, no, it's a question. we just thought of this quite a lot. The one challenging thing is a lot of users want Atom at the end. Like they don't actually want Staked Atom. Like if they're going to go on bunch of CEX or do something else, they often just want to use the ATOM token. And so it's hard to have like a lot of liquidity or solely be St. Atom when users want Atom. I think what we do obviously run LST business and it's been part of stride.

<< Jason Kam (36:32) >>

Well, yeah.

Hmm.

<< Vishal (Stride) (36:50) >>

I think we're looking into right now is are there like idle pools of capital on the ducks that can be staked? So for example, like LP that is out of range sufficiently. And maybe when you LP that you opt into like, hey, I want to earn an additional yield. I'll take on this additional risk. Maybe we can have a lot of the assets in the ducks kind of staked and earning yield, but I don't think it be all of them.

<< Jason Kam (37:11) >>

That makes sense. ⁓ Do you feel like osmosis would be competition in any sort when you're going through this effort? Are they going to do the same thing? Yeah.

<< Vishal (Stride) (37:22) >>

Yeah,

no, it's great question. Our hope is that I think to not be competitive with Osmosis. And in some sense, I think we're definitely going to be somewhat competitive. Like they're a Jackson Cosmos or a Jackson Cosmos. But for the first year, for example, I think we have very specific, like two very specific customers, neither of whom are Osmosis customers. Like it's the Eureka chains and then it's the Cosmos have DeFi apps. Those are like inaccessible to Osmosis.

<< Jason Kam (37:44) >>

Yeah. Yeah.

Hmm...

<< Vishal (Stride) (37:51) >>

And

<< Jason Kam (37:51) >>

Hmm...

<< Vishal (Stride) (37:52) >>

then on top of that, think we're focusing on like token liquidity for like these new Eureka type chains like like Ondo or Babylon or a lot of these customers that barely Magmar talked about. But I was most of that, I think they're trying to focus on Bitcoin or building Polaris. They have like a very compelling and good vision, but I think it's just a different customer base. They're focusing like on unifying much different ecosystems. So definitely a little bit competitive, but I think

<< Jason Kam (38:04) >>

Hmm.

Hmm.

<< Vishal (Stride) (38:19) >>

We're very focused on just a very specific customer group early on.

<< Jason Kam (38:23) >>

It seems like Maghnus had conversation with you both. And Osmo was like, that's really cool, but we got a bunch of stuff going on. And for you, it's like, this is really great. You're 100 % of our focus. And that's ultimately the swing factor that made them decide to work closely. Is that the right way to think about this? Because why do I ask this, Vishal, is because I'm thinking about alignment. And I don't know.

imagine he probably needs somebody that really spends 100 % of their time on Atom. And I don't know also if they plan to own a lot of the Stride tokens to further align the incentive when the conversation happens.

<< Vishal (Stride) (39:06) >>

Yeah.

Yeah, yeah. No, I think this is totally right. So for us, I was most obviously, I think it was a natural candidate to also be the kind of DEX that really helps unlock Eureka, like the IBC and Eureka DEX. But I think for them, have a lot of like really, one, like good business lines going on. I think also just in terms of things they're trying to build out, like they've been working on Polaris for a long time. They're working on Bitcoinmosis or...

<< Jason Kam (39:18) >>

Mm.

Hmm.

<< Vishal (Stride) (39:33) >>

I should have pronounced this on Twitter, know, BGCmosis. BGCmosis, You know, they sound like these efforts are going well. I think they are excited about them. They've been in Cosmos for a long time. But I don't think they want to focus all their efforts on them or kind of be fully part of just of them and, you know, be on the Cosmos Hub or whatever else might entail. For us, was something we thought about for a long time. Like, truthfully, I think we've been a little bit like, just...

<< Jason Kam (39:35) >>

Yeah

Hmm.

<< Vishal (Stride) (40:01) >>

worried about the Cosmos hub over the last two years. There's been some big initiatives with them that were canned out, or it's been kind of a big leakage of users, been a ton of product direction. And so we weren't really sure how it was gonna be after  Mag took over. But it's honestly, we've had, been pretty inspired by them and been pretty impressed with what they've accomplished. And we've had a soft spot for Cosmos for a long time. When we first built in Cosmos, we'd been users for about a year. Before that, we'd...

<< Jason Kam (40:15) >>

Hmm.

Hmm.

<< Vishal (Stride) (40:31) >>

We're incredibly excited then, it's still about Hub Chains and I've really wanted to grow and be part of that. ⁓ And I think now we're excited that there's a clear path to getting there. The work that hasn't been for a while. And I think we're fully committed and we're happy to be fully committed to the Cosmos Hub and help build out that vision. And for Osmosis, I think they have their own visions. It's not any less good, but just different.

<< Jason Kam (40:53) >>

Would the ICF or ICL purchase a big slug of Stride through TCN Open or OpenMarket to further align the incentive? Or do you think that's not what they're going to do?

<< Vishal (Stride) (41:04) >>

It's possible, I think that they might be open to it. They haven't committed to anything like that yet, but they are making investment in Stride. I think it's something they're open to, but think legally they haven't done open market purchase or anything ever in the past since Operation. I'm not sure how else it would be. ⁓ But hopefully they keep getting Stride and they'll continue to be aligned with the protocol.

<< Jason Kam (41:13) >>

Okay. Okay. Okay.

Hmm.

And this tax effort is self-funded. How much grants are they paying you per month to facilitate this?

<< Vishal (Stride) (41:34) >>

Yeah, I don't know if they're disclosing the amount, but it... Yeah, yeah.

<< Jason Kam (41:36) >>

Okay, you don't have to tell me. It's my job to ask. You don't

have to tell me. Yeah. Yeah.

<< Vishal (Stride) (41:42) >>

Absolutely. It's a great question. But it's

a reasonable amount. I think this is a very big effort for us. We're all in on this. This is 100 % our focus. It's a big bet. We're very confident in it. But we're betting everything on this being a huge, Eureka really growing and seeing what we can do to help that. But at the same time, I they're also making a very big bet on us. The DEX is a big part of this reconition. They're next right after the hub. The hub DeFi ecosystem revolves around the DEX.

<< Jason Kam (41:53) >>

Hmm.

down.

you

<< Vishal (Stride) (42:11) >>

As a result, making a pretty reasonably sized investment to stride. But I think it's very like we, there's a lot for both of us to do to help the other person.

<< Jason Kam (42:21) >>

⁓ That's very helpful. ⁓ How would you, I mean, it's so to buy if you're retail, like you can, but are you, plan to do anything to improve the liquidity of this coin at all? Yeah.

<< Vishal (Stride) (42:35) >>

Yeah,

yeah, absolutely. This has been a big pain point and the token is very hard to buy right now. It's something we've working on. It's been a little challenging in Cosmos, like the overall volumes and users have gone down. So the natural volumes got down. It's a little hard to of resuscitate that cycle. We've been trying to strike some deals more recently and should go live soon to help increase liquidity with a few market makers as well as

<< Jason Kam (43:02) >>

Hmm.

<< Vishal (Stride) (43:04) >>

think as when Dex actually comes out, you have a lot more control over, you can pair things with the token or you can direct incentives or make the pool fee free or whatever else it is to help make the token more liquid. I think one stride actually is a Dex, token location should be increased a ton. But it's also right now, I'd say a big thing that we're thinking about, part of this building out the stacks, think, and building out...

<< Jason Kam (43:16) >>

Hmm.

<< Vishal (Stride) (43:30) >>

is we want to make the token more accessible, because it's also part of the product. Or at least it helps enable, like it's standardized with the DEX itself, and so we to make that a big push.

<< Jason Kam (43:34) >>

Mm.

Yeah, I think it plays well with the DEX that you're building, and in particular with Eureka too. ⁓ Would you consider wrapping your token and then bridging it over to, let's say, Ethereum and then creating an LP pair there so that people can also buy more easily?

<< Vishal (Stride) (43:54) >>

Yeah, think we're not opposed to this. ⁓ So in full transparency, we actually don't do any of things on chains, as someone else does, but I think we'd be open to someone doing that. The only thing is, in the past, people have done this, ⁓ and we haven't seen very great liquidity for these tokens on other chains. So even like Atom, we bridged over to, Atom's drivers will do this, we bridged over to Arbitrum, and didn't see very much adoption or trading of a token there. In general, we don't see that much of this across any ecosystem.

<< Jason Kam (44:06) >>

Hmm.

Hmm.

Hmm.

<< Vishal (Stride) (44:23) >>

There are some memes that are exceptions, but general it's true. I think there's a loyal user base of people who trade a token, and they tend to live on one exchange or one website or one venue. And when you bridge somewhere else, users aren't too much of seller, they're unlikely to buy it. ⁓ But we are looking at ways to make the token more liquid than Cosmos.

<< Jason Kam (44:36) >>

Hmm.

⁓ Do you feel like with this dex and the atom relationship, is there anything else we haven't covered yet?

<< Vishal (Stride) (44:53) >>

That's a question.

<< Jason Kam (44:54) >>

Yeah,

I think we covered quite a bit. ⁓ I think the only thing left would be if there are any other products, like lending. But I don't know. You've got a full plate. So you kind of want to crush the DEX first before thinking about anything else. So I don't know.

<< Vishal (Stride) (45:11) >>

Yeah, yeah, absolutely. Yeah, I mean, I think ⁓ in most ecosystems, Dex's are just so like, having a good Dex is so good, having bad Dex is so bad, but good Dex's can really capture so much value. it's much more, like, Perps is a little bit more, think, and maybe named point launchpad with pump fun. But in general, it's like one of the highest ⁓ value capture protocols in any ecosystem. And think it's where we want to make most, almost all our focus. And then I think if and when that's successful.

<< Jason Kam (45:22) >>

Hmm.

Hmm.

<< Vishal (Stride) (45:39) >>

we can start expanding more products, we'd sort of create a little bit more. But definitely maybe focus on the DEX. ⁓

<< Jason Kam (45:45) >>

Is

there anything else that you has execution risk or keeps you up at night and is like, this might not work that we haven't discussed yet? It seems pretty clean. I thought this is exciting because

your market cap is under 30 million FDV. If you hit anywhere close to the revenue target, you get comp to DEX right away. And because it's so thin, I don't know how much float is out there. You probably own a bunch yourself.

This should really just work.

<< Vishal (Stride) (46:14) >>

Yeah, we're hoping so. think, yeah, I mean, we've thought about this for quite a while and I think we have a good structure here. Like it really does seem like lot of ingredients. I think that the key things for us is we have a guaranteed customer base with your customers and they have a burning need. And as long as we can do a good job addressing that need, we know where to get that volume. And we're fully kind of dedicated to addressing that need. Then there's like Hub DeFi ecosystem. Like they also need a dex. I think we'll be like kind of the de facto location for that.

And then these Cosmos retail, I mean, our volume, again, if we do a good job there, we can get a lot of that flow. There is some execution risk here. Like we have to make sure we do a good job. that means we to make sure we get liquidity commitments, make sure we can get like a, a good job managing on liquidity when we deploy it, make sure we actually understand what users want, like to make sure like, know, user A is going from, or like where users are reaching from or reaching to, like to understand deeply. So we have to do a good job of this, but I think if we do, we have a really good setup here.

<< Jason Kam (47:06) >>

Yep.

Who's your auditor, by the way?

<< Vishal (Stride) (47:14) >>

We use informal systems right now, so we've done like 12 audits with them. They are by far the best in Cosmos, think. We have lot of great auditors in Cosmos, but Informal develops the core Cosmos SDK. They're like the ones making everything. Great auditors. But we might look into other auditors for EVM. Informal is also good at that, but we're just not familiar with EVM, and so it's possible there's other good auditors we should look into.

<< Jason Kam (47:25) >>

Hmm.

Yeah,

it's Alec Halbourne. Happy to do intro. We can do it. We can do it offline. That's all I have. Let's see if the group has any questions. Give it three seconds.

Okay, that's it from me. Vishal thank you so much for your time. This is very helpful.

<< Vishal (Stride) (47:58) >>

Thanks so much, I really appreciate it, and thanks for having me on. Yeah, it was a pleasure.