Venture Mandates, Cloudflare Wallets, Circle Earnings & Saddam Hussein Patek Philippe

Rob argues that many crypto venture funds are straying far outside their mandates into hardware, mechanical engineering, nuclear, and robotics despite lacking experience in those areas. His view is that companies with options prefer capital from investors with deep domain expertise, and that a crypto-heavy cap table in a robotics deal is itself a negative signal, implying that people with genuine mechanical engineering expertise passed on the opportunity. Rob draws a distinction between pre- and post-2021 crypto investing, arguing that before 2021 returns were driven largely by the overall industry wave, while after 2021 success required simultaneous depth across cryptography, network scaling, and capital markets infrastructure. His conclusion is that only Andreessen Horowitz and Paradigm have the size and capabilities to operate credibly as multidisciplinary crypto firms, and that reinvention into a new sector takes years rather than six to twelve months.

The 90th percentile 2022 vintage venture fund TVPI is 1.68x with only 10 to 12 percent of capital distributed back to LPs, a figure cited to illustrate that making money in crypto now resembles regular venture, which is itself harder than it used to be. Inversion's own scope is described as deals that touch crypto or are adjacent to it, with NFTs, consumer, and social no longer considered part of the current mandate. An AI spend management company in the portfolio uses the X402 protocol, reduced token spend by approximately 80 percent for its first clients, and counts Anthropic, Excelsior, Gradient, and Austin Coinbase among its investors.

Cloudflare announced a programmable wallet system called Cloudflare Wallets designed for the agentic internet. A human controls an account wallet handling fund storage, on and off ramps, and policy setting, and can spawn virtual wallets controlled by agents via API keys. Each virtual wallet carries guardrails including spending allowances, allow lists, maximum transaction sizes, and overall caps. The wallets store and spend using stablecoins and integrate the X402 protocol, which enables payment for APIs, MCP tools, content, and AI inference attached directly to HTTP requests. Cloudflare remained stablecoin agnostic and supports most major blockchains, with its stated strategy being to own the identity and authorization layer for agentic transactions. Roughly 25 percent of the internet runs through Cloudflare, and the company puts bot activity at between 55 and 60 percent of all internet traffic, providing context for why it is building infrastructure for non-human economic actors. Will, founder of Syndicate, was acqui-hired by Cloudflare as part of this initiative. A bear case raised in the discussion holds that agent payment workflows could be handled entirely with existing rails using dedicated credit or debit accounts without stablecoins, and single-use virtual cards are already used by online travel agencies like Booking.com for every transaction as a functioning non-crypto precedent.

Circle reported mixed quarterly earnings with the stock finishing roughly flat on the day. Total revenue grew 7 percent year over year, adjusted net profit came in at approximately 50 million dollars, and adjusted EBITDA was approximately 140 million dollars, down quarter over quarter. USDC circulation fell from 77 billion to 73 billion dollars, and on-chain transaction volume dropped from 21.5 trillion to 15 trillion dollars. Circle Payments Network volume surged approximately 75 percent, and the company raised its other revenue guidance from roughly 150 million to 300 million dollars, a jump attributed to accounting recognition of cash pre-collected in the ARC token presale, with ARC mainnet scheduled for approximately September 16. The stock was trading around 64 dollars, down approximately 70 to 80 percent from its peak, and fell roughly 17 percent on the day a USD consortium announcement was made. The stock trades at approximately 32 times EBITDA, which one speaker characterized as not cheap relative to owning Visa. Rob argued Circle is the only vehicle for normal investors to directly express bullishness on stablecoins in public markets, while the market was spooked by the open consortium launch raising questions about network defensibility, and some logos appeared on the announcement without the named partners' knowledge or consent.

Western Union does approximately 110 billion dollars of cross-border transfer volume annually, serves roughly 50 million yearly active customers, and generated 4 billion dollars of revenue last year. Its stablecoin product launch was described as a mismatch of know your clientele because its base prefers cash, and in Africa and Latin America retail users prefer cash and USDT, making Tether the dominant competitor. Western Union is working with Rain, which launched in 37 markets on day one and is expected to reach 60 markets by end of year. One speaker argued the addressable stablecoin market over the next two to four years is smaller than widely believed, while a dissenting view held that tokenized asset settlement infrastructure represents a major opportunity the bear case underweights.

Patek Philippe produced watches as a corporate client for Saddam Hussein's Iraq from the late 1970s through the 1980s, and those watches were distributed as political currency to senior Iraqi military officers, bureaucrats, diplomats, and VIP guests at the presidential palace rather than sold publicly. A watch from that era is listed on a platform called Loop with the current bid at 26,000 dollars. One speaker placed an early bid but was quickly outbid and stepped away, citing bear market conditions.