Zama (ZAMA): Does Onchain Privacy Pay the Token? | Daily Crypto IQ 🧠🌐

0:06I never knew. Heat. Heat. Yeah. Yeah, hey. you can't do it. everybody. I never knew. I never knew. Heat. Hey, Heat. I think that we just Holding on to

4:16something. >> I wonder I think that we just holding on to I think that we're just holding on to something. Just tell me what's welcome to the Underground Crypto Deep Dive Research Show token autopsy report interactive digital board game. again the longest title for a show in crypto. I wear that crown. How's everybody doing?

6:00It is, of course, you guys have probably already heard a sad It's a sad day. I mean, yesterday was too when I found out. Um, we lost Reliable Jay, which really does sting because he was very reliable and I had the the luxury of hanging out with him in Miami around the Bitcoin convention. and we went to the Crypto Lifer meetup together. Um, that's where I really got to know him more. I talked to him on the phone many times and talked to him on the phone

6:30many times after that and I really will miss him and uh, not just for him being on the stream, but we we talked a lot and connected a lot outside of the stream. And he was just a good, very reliable, solid dude who you could trust. And it's just a shame to lose somebody like that. Very unexpected. He wasn't very old. I mean, I don't know. his exact age. I I think he must have been around getting close to 50 is what I would say. So very early in his life,

7:00he had two little girls. I have three kids. So I I definitely feel that it really makes you stop and think about a lot of things. It really does. And uh I don't know what else to say about it, but we will especially from time to time be remembering Reliable Jay. Just a moment of silence. Tonight we are going to be going over Zama. Zama very interesting. We followed

7:36Zama for probably like a month before it had its token generation event. It launched with a lot of liquidity. I want to say like 200 million in liquidity when it launched and or in the project, right? I don't I don't know if you want to consider that liquidity, but in some respects it is liquidity if you're trying to get in and out of the project. Plague Dog says, "Grateful we got to know him." Exactly. And at at a time

8:02like this, that's one of the things you got to think about that it is it is great that we did get to know him, that we did get to hang out with him many nights. And the times that I got to hang out with him in person, he was a a dedicated lifer. Um, you know, viewer and enthusiast. As you know, I was I'm in the lifer community. I've uh been a lifer before I ever started streaming. I think Sam is honestly one of the people who really helped give me the push to

8:31really go in on my channel. And so it sucks to lose somebody who was such a part of that whole thing, especially when I first started. Don't forget that he was among one of the first people to come over to the stream and come consistently and support me when I had, you know, nobody. And he was a real crypto person who had been in crypto a long time. So, we really resonated a lot. So, we're going to remember him as we move forward and do

8:58this crypto research. Monday through Thursday, token uh autopsy Friday, DeFi, Friday, he always hung out. He played Kindra with us. And then Saturday, Saturday, we might be switching it up cuz I feel like the weekly wrapup stream is just not strong enough for the community. Uh, as you guys know, I am always aiming to make this show better. the visuals, the slides, the way that we put it together and do the research and I

9:28present it to you. All the little things from the digital board game. Uh I don't know if Plague Dogs has really been back since we had the digital board game. You know, you can put exclamation point, uh Splash, Rambo or Lambo, sorry, and all kinds of other things. We have all kinds of visuals. We have, of course, the full-on board game. Winner of the board game gets $10 in free cryptocurrency, whatever they choose. Um, so try to win that game and get you some free crypto.

9:57My favorite one, of course, is the splash. I don't know why I like that one a lot. It's good visual. Go ahead and throw that in the chat. So, before we lock into our token autopsy, I'm going to give it a minute for everybody to roll in and we're going to do some news. I'm going to cover some news articles here of what's going on right now. Let's go ahead and zoom in a little bit.

10:28There we go. So, let me make sure I'm up on the chat if anybody has anything to say. Melissa says, "It's heartbreaking." It really is. thought if show up be reliable in memory and then plague dog says people don't think about it but we've been through thousands of live stream chats come consistent let alone in each other's discords etc

11:06we are family for real yeah and I always say that we're you know this is the underground crypto family and I like to you know get to know everybody like for example tonight Seeker who has recent very recently joined our community and also makes his own uh content on YouTube. Check him out. I like his TA quite a bit and his ideas that he lays out. Um oh, there he is, too. He's right in the chat. Uh I'm going to My point was I consider us family. When somebody

11:34new comes in, I like to talk to him in person. I think I'm going to sit down, have a, you know, audio conversation with uh Satseker. And you know, that's how we like to roll around here. At one point we might get so big it might be hard for me to do that. But until then I'm going to continue to do that as much as possible. Shout out to all the undergrounders. I appreciate you being here. Smash that like button. Subscribe of course.

11:59Consider buying one of those memberships. They start at $3. You get free custom emojis I made myself. You can use the custom emojis in the digital board game. And I'll show you how. So, when you hit exclamation point peace and then a space and whatever emoji you would like to use. So, I'm going to use this trophy emoji. And so, that'll allow me to change my piece on the actual board. Let's go ahead and get a roll in.

12:31And let's cover some news. Melissa showing off those custom emojis. Of course, I have higher tiers of memberships if you want to support. You get some extra things, but $3 a month base membership. And also with the token autopsy, I've talked about this a lot. When we get to 40 token autopsies, you're not going to be able to see them in the Discord unless you have at least that 3.99 membership or 299 membership, sorry. And so, you know, I want to go

13:03fulltime with the YouTube. I want to do like a morning show, like a morning news show. It it'll be later because the Crypto Lifer is live at that time. I'm in that community. I want to watch that stream. But usually probably around I haven't locked the exact time, but 2:30, 3:00, 2:00, I'm going to do a morning stream when I'm ready to do that. I don't want to start it until I can do it consistently all the time. And then I want to put out a lot more content for

13:27you guys. We built a website. Let me show that off. If you've never seen our website where all of our news is aggregated, I put out tons and tons of great DeFi news articles about tons of relevant things going on in the space. Can be hard to keep up, so it's nice if somebody comes and presents it and puts it in a quick readable uh thing for you. So, let's click on one of them. You know, you get great visuals, a quick

13:58rundown, the source, of course, a quick guide to X. You can find me over there. We have some guides to make if you're new, some quick five, six minute reads that can catch you up to speed. We also have a glossery for those hard words you might not know what they mean. APY, what's the difference between APR and APY? Well, we got it right here for you. And I'll keep updating this stuff. There'll be a lot. This is the first generation of it. We

14:25got some tools for you as well, calculators for different things. And then, of course, we have the Crypto IQ quiz. Now, I like this thing. I know that a lot of people might be intimidated by it, but we have a beginner one. You should be able to get a decent score on the beginner and then continue to test yourself. And we have beginner, intermediate, advanced, and when you get to the end of it, you can have a link where you can just quickly

14:51post it over on X what you got your score for. and then you can tag me in it and I think it's a really cool community thing. Also, we have merch now. Check out the merch. I look forward to Melissa getting her merch in and showing it off in the Discord so I can see what it is all about. Uh, you requested a bandana. Got that for you. It was actually Reliable Jay who had requested some winter hats. I got those in. And then we got socks

15:21for Blues Guy. He said he wanted socks. We got shirts. We got hats. We got cups. We even have some more uh merchandise here. I just want to show it off cuz I really like the coffee mug. Coffee mug is pretty cool. Let's see. Yeah, we want the full thing. We got sticker packs. We got these nice cups that come in two different sizes. So, check that out if you want to support the channel and get yourself some merch. Represent as we are up and

15:47coming. Let's get into the news. I think we gave a good minute for people to come in. >> Melissa says, "Didn't Nice. Didn't know about the website." Yeah, we got a full website now. Plague Dog says, "It's the lifer effect." Liferhip me to you now. Hip and lifers to seeker givers gain. Exactly. 33. Chris Goss will pop in here at one point and throw us a 3 I3 just to let us know

16:18that he he uh he sees us and he supports us. I appreciate all my lifers. A lot of the people who first came to this show and supported me and hung out were lifers. I couldn't say enough good things about Sam. You know, God bless Sam and that he's always healthy and his family is good. Of course, in a moment like now, it's critical that we say that, right, and mean it. So, let's get into some news, right? It's a little bit heavy. We want to lighten it up here and

16:44do what we do because that is the secret sauce. That's what Melissa says. Secret sauce is the persistence. Keep showing up, keep going live. And I keep raising my crypto IQ day after day after day. I've learned so much that uh when I talk to people, I got to slow down because I I forget how much people don't know about this space. I think a lot of the stuff in this space is amazing. Akos, you shouldn't be familiar with the Kosh project if you've been around for a

17:12while, wants to shut down its Cosmos chain and move to Salana. I wonder why. We did a deep dive before we did the token autopsies. We would do a lot of very like specialized streams about an ecosystem or one specific educational topic. Cosmos was one that we did a deep dive on Cosmos and Cosmos Chain, what we got out of it was kind of dying off. Was not doing too hot. Now, of course, they could bring it back. Adam has great um you know staking

17:41interest that you can get on your money but can they sustain it long term? Akos network the decentralized GPU cloud computing market which is something that is highly useful in AI so there's a use case for it open proposal 346 today asking AKT holders to approve a migration from its own Cosmos based sovereign blockchain to Solano early voting overwhelmingly in favor around 98% although the formal vote still remains open until November 2nd. And

18:17this isn't Akos also supports Salana. No, the plan is to eventually retire Akos's existing blockchain. So, we're seeing a lot of consolidation across layer 1's and layer twos where it was like everybody wanted to launch and be their own blockchain and now it's kind of like, well, we need to be where everybody else is. And if every single person just goes out in the ocean and builds their own island, then everybody's very disconnected. We

18:46need that layer zero. If you remember a lot of our educational topics, layer 1, layer zero, layer layer 2, layer three. What does that mean? Guess you'll have to go dig up some old videos, huh? Well, anyways, first AOS would become an SPL token through a one-way onetoone migration. The portal would remain open for 2 years, which is plenty of time for you to get in. The actual Compute market would move later to audits, test net, and another governance vote. The funny

19:16thing is, I think I own a tiny bit of a kosh on like KCoin, which we got kicked off of a long time ago, even though I have the Palao ID. We don't talk about the Palao ID a lot. When it first came out, it was easy to use on exchanges. Now it's like sometimes you'll use your Palao ID, digital residency ID for exchanges and they'll still deny you, which is weird because that was supposed to be the whole point of it. But why Salana? I think we all know why Salana

19:44would be, right? Akos says running its own validator network is expensive. There you go. And unnecessary for roughly 15,000 market uh marketplace transactions per day. On Salana, it estimates the entire marketplace could consume around only 0.075 soul and network fees per day at its current activity, saving a lot of money. They can do a lot more. They can pay a lot more developers and actually build more stuff. Akos also uh specifically

20:13pointed to Salana's existing DPIN ecosystem. That is decentralized infrastructure. It's what that stands for. Render helium uh io.net. That's internet of things I believe. and others as an advantage. So it would definitely benefit from moving to Salana. This fits the trend that we've been watching. Data networks giving up its chain for sweet data the project right abstract is shutting down. Blast is strutting shutting down and now Akos is

20:42considering abandoning abandoning its cosmos chain for Salana. I got to wake up talk clear the early or the era. See what I'm saying? I just rolled in from the gym. I'm actually quite tired but I'm going to keep the energy up for everybody. So the error of every project needs its own blockchain or should be a layer 1 is getting challenged pretty aggressively. Akos basically decided that owning consensus isn't its product. Decentralized computation is the

21:07product. If another network can handle settlement cheaper, why pay a 100 validators to maintain your own chain? And how does that work for the people who've been on I guess it's fine for the validators cuz they probably get paid in the token and they're going to be able to migrate one to one. So, they really shouldn't lose out on anything. All right, we're going to do one more story here. Coin DCX finally admitted that about 16 million really was stolen.

21:33This is one of the uncomfortable transparency angle stories for tonight. So, Indian exchange Coin DCX confirms a loss of roughly 15.9 million USDT after initially pushing back on blockchain investigators who flag suspicious activity. The problem traces back to wallets that had supposedly been retired following Coin Dex or Coin I want to say DEX Coin DCX's 2025 security breach. Customers apparently continued sending funds to

22:04some of those old deposit addresses. Coin DCX still credited customers for those deposits and had an automated system designed to sweep the funds into newer infrastructure. That sweeping process stopped working. funding accumulated in the old wallet infrastructure. Roughly 16 million was eventually taken. Coin DCX says it is absorbing the loss and customer balances were unaffected. That's good on their hand. And 16 million for a real exchange

22:34shouldn't be much money. The strange part is that CEO Summit, whoever that is, Gupta, initially described reports around the addresses as essentially a false alarm before the exchange later confirmed the actual loss. Was it just PR and damage control? I don't know. It's an Indian exchange. So, we we here in America, me mostly, um, and everybody else in America, we probably have never use this exchange. If you're in Canada, you probably never use the exchange. A

23:02lot of people probably never use that exchange. But the hack matters, but operational failure is arguably the more interesting part. Depreciated wallets continue accepting real customer deposits while the mechanism designed to empty them failed. And that is basically that is basic wallet infrastructure becoming a security problem now after the token autopsy will pick back up with some news. Bloom trading users had about 9,48 sold drained in 94 seconds. I'm not

23:33so familiar with Bloom. I don't use Bloom Trading, but that is not good to say the least. All right, let's hop over to Zama on Coin Gecko and take a look. Max chart says token generation event and you guys were probably watching the stream the day it happened was February 1st 2026. It is sitting at about 7 and it's up 107% on the max chart from when they token generated. Market cap 182 million.

24:04Uh infinite max supply doesn't need to really say but you know how I feel about an infinite max supply. and the circulating supply 2.5 billion out of infinite. So they give you a total of 11.3 but really what does infinite really mean? And of course what are our contract address? Well you got Ethereum B&B and Salana but you do have Zama's gateway mainet so it has its own mainet is what it seems like. I don't think it's a layer two. Privacy infrastructure

24:37and privacy probably the most meaningful tags that it has. And if you scroll all the way to the bottom on Coin Gecko, it will tell you exchanges that you can buy it. Binance, Mexi Global, Gate.io, Kraken, Coinbase Exchange. You can get this coin pretty easily. Remember, you can always search centralized exchange, decentralized exchanges. And then down here, they've actually changed it. They split them up. you have derivatives where you can look for perpetuals and

25:03futures and things of that nature. But on a smaller coin like this, perpetuals can be rather treacherous. And sometimes you'll use an exchange uh and it'll tell you like you're only allowed to buy a certain amount of it, which is kind of odd. You'll be like, you can only buy $15 worth of this. Let's hop on into our token autopsy report. I don't know what this missing image is up here, but I'll live with it. How's everybody doing? If you just

25:32rolled in, smash that like button. Where's the blues guy? I'm not sure. I know he was starting a new job today. Maybe he was tired after they ran him around today at his new job. Let's see. 80,0002. Where is the blues guy? All right, cool. I think I'm caught up on the chat. Yep, looks like we're caught up. So, let's get into it. Zama 137 million in encrypted vaults. Now, you know, a lot of projects have vaults. Vaults usually

26:06have a strategy of some sort kind. I don't know why I'm misspeaking. A strategy of some kind that is the vault and the vault you put your money in, you're participating in whatever money generating strategy that they have and then you benefit from that. Melissa says, "Is there any coins out there with an infinite supply, but the token value or price has gone up?" I'm sure there has been. I would say the infinite supply is not an automatic no

26:39in my opinion, but you really have to dig a little deeper and know about the emission. That's when coins come out in the circulation uh versus any kind of burn mechanisms or anything like that. But you got to see how many coins they're pumping out per year to kind of calculate how much you're being inflated. That is very important. All right. So, great products versus good token. Remember, this is a token autopsy report. The token is the focus

27:08because this is not stocks. You're not buying into the company. you are buying a token associated with an ecosystem made up of products that were built by the company, by the team, by the project, whatever you want to call them. So, the product reality is that Zama brings encrypted balances and private D5 vaults directly to Ethereum's mainet. 137 million in shielded TVL and 16 institutional Morpho vaults are already live. The token question though, when

27:40users wrap USDC or earn vault yield, what economic job does the Zama token perform? Is there any utility? That's the word we would normally use. Do fees burning outrun 5% staking inflation and 50% insider unlock cliff. I wonder how long those insiders really need to hold on to these tokens. Is it years or is it months? Right. at at some point soon is there going to be a big token unlock? So, CUSD, right? Anytime you have a stable coin USD,

28:14USDT, and there's some letters in front of it, that usually represents something to do with staking or some kind of locking it up or a vault, any of those kind of nature. You get another coin that has like some letters in front of it, but it's really just a representation of your stake in a staking pool, liquidity pools, vaults, whatever, right? A locked up uh mechanism. So a 1:1 wrapped version of USDC also

28:43what we call a wrapped version right in USDT with encrypted balances an ERC7984 which is a type of Ethereum coin backed dollar for dollar by underlying stable coin in the wrapper contract but the Zama token the protocol's utility and staking token buying Zama does not give you a dollar back stable coin the vault users don't even need to hold Zama if an app or relay pays the fee in the background. And that's something I'm not going to go into, but apps can have a

29:16pool where they already have the native token for fees. So 0% protocol fee for FH math, right? Don't be intimidated, right? But fully homorphic encryption, that's what FHE stands for. Encrypted math is here and big apps are getting a 99% discount. So running encrypted calculations add, subtract, compare. The Ethereum carries zero Zama protocol fees. Zama only charges a three gateway choke point.

29:54Verifying encrypted inputs and decrypting a result and a bridge. Those are your three points, right? a verifying encrypted input, decryptting the results, and a bridge to get back and forth. So, we have 80 cents or 80 Yeah, 80 cents to 0008 per tra per transaction. So, I don't know if I should overexlain before we get to it, but there's this whole thing about big apps on Zama pay significantly less fees. And that's what

30:26it's trying to result is like a normal user might pay 80 cents where a big app is going to pay like 0.008 per transfer. A casual user pays 80 cents for a confidential transfer, but high volume wallets and apps on a monthly plan get up to 99% discount, paying less than pennies. Is that a good thing? Is it a bad thing? There's always this tugof-war between both. The person who holds the coin wants a lot of fees because it can with the right burn

30:58buyback mechanisms generate a lot of value in the coin. On the other hand, if you're a user of the product, you like low fees because you can get a lot done with your money. So, if you're a holder of the coin and a user of the product, then how do you feel about it? Which one do you want? It's a it's a very interesting dilemma. If you've ever heard about the crypto dilemma, Melissa says, "I look like a troll." What is that about? CCP says, "Uh-uh.

31:31Can't doubt yourself. All right, so the real world catch here. Issuers freeze still works and this is just something that happened in May to June of 2026. The US court ordered caused the order had caused circle the group that issues USDC to freeze Zama's entire wrapped contract of about 12.5 million 99% of shielded CUSDC for 3 days. This is where it gets weird because Zama is very much selling themselves on this fully uh homorphic

32:08encryption and privacy, right? If you don't really understand what that means, that's fine. Just understand it is privacy. And if Circle can still lock up, freeze money, then is that privacy really valuable? Like, yeah, it's private, but not if they find out something they don't like. So, that is a very interesting uh dynamic that we have to keep in mind about Zama. So, the first person batch leak vault deposits entered Morpho in public batches. If you

32:40are the only person in a batch, the public batch total reveals your exact deposit size. Kind of makes sense. They batch them. But if you're the only one in there, then all of it is you, right? Confidential insider vesting. Zama bought Token Ops in May of 2026 to vest team and venture capitalist token confidentially, protecting staff privacy while making Ethereum scan unlock tracking harder for retail. Signal verse noise. One of my favorite

33:13things to start off the show with here. Signal important noise less important to not important. the coin DCX story that we had just covered here, the Indian exchange that absorbed the $16 million loss. We just went over it, so I'm not going to overly repeat it. And then what is noise about it is that on a public chain, retired deposit addresses never stop receiving funds if the user still saved them. Security is continuous ops, right? not a one-time

33:51patch. So, let's see. Bitcoin steadily nears 80,400, right? With the fear and greed index at 50, which is neutral. We look at the fear and greed index a lot here after 772 million in twoday spot beat Bitcoin BTC ETF outflows ahead of Wednesday's Fed decision. So, we have money pouring out of ETFs, which is your instit institutional instrument, right? Meanwhile, CoinDesk DeFi index was the

34:23only crypto sector in the green Monday morning. Macro liquidity signal, a neutral market stops rewarding empty narratives and rotates towards protocols with working vaults, real collateral, and verifiable yield. So, OCC finalizes Genius Act stable coin rules. So, the US OCC finalized its Genius Act rulemaking for federal stable coin licensing and a onetoone rever uh reserve banking and this will be

34:56effective January 18th of 2027 on the same day Zama Shield uh TVL hit 137 million. What's interesting is that like the Genius Act passed and then they had time to figure out what what the rules were, what they were going to do. It's like how do you pass something before you even figure out what it is? I don't know. Very odd. Very odd for sure. So, high structural signal here. Regulated banks and companies entering stable coins in 2027 cannot broadcast

35:32employee salaries or supplier invoices and plain text on Ethereum scam. They need programmable privacy. It just kind of goes to show what the use cases for all this privacy talk, all these privacy projects. take a look at your privacy coins that are doing updates for postquantum security because I have a feeling if any of these stories break about some kind of quantum computer doing something, people are going to shift and move into things that they

36:03think are safer and have updated whatever they're doing, their security to be quote unquote postquantum safe. So, what is the problem here? What is the problem that Zama is saying that they're trying to fix? Well, a corporate treasury manager, let's call it Maya, and this is obviously an example, wants DeFi yield on 50,000 USDC onchain payroll, right? So whether she wants yield or she wants onchain payroll, but public blockchains expose

36:35every balance and salary to competitors and bots. Now don't forget big institutions have to play nice with the regulator and so some of them literally have to have privacy because they would validate invalidate themselves to the regulator. So Zama spent 5 years in 150 million plus making fully homamorphic encryption run the regular solidity on Ethereum scaling to 137 million total value locked in 16 institutional morpho vaults.

37:09The payoff well Maya gets private yield on Ethereum. Tonight we test whether that product usage actually pays the Zama token holders anything. what we call token value capture inside an ecosystem. So act one product and ecosystem. What did Zama actually build on Ethereum and who uses it? Verified identity and contract scope. It's right here. I'm not going to read you a contract address, but it's there because these slides are

37:40going to be in the Discord. They're going to be there for people who are specifically interested in a deep dive of information on a specific project. Maybe you have a little bit of dough and you want to do your due diligence, raise that crypto IQ on a project before you put some money in it. That is your own business. This is never financial advice. It is crypto research. So don't mix up these three entities. Right? We have Zama the company. Zama Switzerland

38:05AG Paris RD 100 plus staff 40 to 50 PhDs and 30 patents sells private commercial software license. The Zama protocol is the live encryption network on Ethereum and of course host chains like arbitum gateway rollup five co-processes and 13 KMS nodes. The Zama token though pays Gateway fees and stakes operators. Buying Zama buys zero equity in Zama the company. I want to make that real clear. And zero claim on its private patent licensing revenue. So

38:45you're not getting a piece of the revenue. So who actually needs onchain privacy in the first place? Corporate payroll of course. Uh, Braun wallet already used Zama's confidential USDC or USDT on Ethereum to pay real team salaries, hiding paycheck amounts while settling on the main net. Treasury managers and funds need to earn Morpho lending yield or swap large sizes without copy trades in MEV bots front running their positions. Yeah, you don't

39:19want to get sandwiched attacked on a lot of money because it can be a lot of money lost. Regulated asset issuers, well, they need customer balances hidden from the public while keeping KYC right and audit and auditors viewing keys programmed directly into the token. So, how FH works? So we hear a lot about other mechanisms like zero proof or zero knowledge, right? A proof would be zero knowledge applied to proofs. You could

39:51have zero knowledge applied to roll-ups. Well, this is different. This is FHE, but it's still going after the privacy function. So we want to know what does this even mean? It's standard encryption. Data is locked inside a safe while moving across the internet. The moment a server needs to add or compare balances, it must unlock the safe in plain text, exposing the secret to the server. Zama, FHE, so this is standard encryption is what normal encryption

40:24would do. Here's the difference. Like heavy rubber gloves built into a lock box, the computer reaches in and adds, subtracts, compares encrypted balances without ever unlocking them. So it's a way to see this information and verify the information without actually giving the information away. Zero knowledge does something very similar. Encrypted math right computes directly on encrypted numbers with 128 128 bit postquantum latency security. So

40:58here is this postquantum narrative and it is a little techy. I'm not going to read every little tiny math equation for you guys. So, zero knowledge input proofs and zero knowledge P a lightweight proof generated in the user's browser proving the encrypted number they submitted is valid before the network processes it. So, this is very interesting. It actually uses zero knowledge technology inside of it. Threshold MPC so splits the master

41:31decryption key across 13 institutions. So, at least nine of the 13 must agree to unlock any permitted results. These are just security features. Don't let that overwhelm you. CCP, you're killing me. That's so funny. Said, "Hit the like button like Islam hits Europe." Oof. Oof. That's crazy. I probably shouldn't say that on YouTube. Product number one, confidential tokens. Right? How one:1 wrapping actually works? It's pretty

42:09simple. It's one one, right? So, co-developed with Open Zeppelin, users deposit regular ERC20 tokens get a one:1 into Zama's wrapped contracts to mint encrypted wrapped versions of many different tokens from Pendle to wrap BTC, of course, stable coins as well. What does wrapping do and what does it not do? well, encrypts wallet balances and transfers them out on Ethereum. Does not create a new dollar reserve. Every CUSDC

42:41is still backed by circles USDC sitting inside the rapper contract. So, it doesn't create a brand new liquidity pool to back it. So, Morpho, the lending engine, Morpho supplies the underlying Ethereum lending market where real borrowers pay interest. institutional curators, risk management, stakehouse financial uh I'm not going to read all these names of these different companies, but here you are. These are the five institutions

43:12that are curators, bitwise, you should recognize a couple of these. Flowesk. So, Zama batches encrypted deposits into Morpho and keeps each user vault share balance private, unless of course you're the only person that's being batched. So, a confidential swap, right, what they call an RFQ. A trader requests a swap quote. Eligible market makers see the trade size so they can price the liquidity while trade

43:44direction buy versus sells hidden. Private matching only the winner market maker learns the trade direction needed to settle the fill preventing public mess right not meme but memp pools from front running. Mempool is where your transaction sits before the validator picks it up and makes it final. So fee deduction the contract verifies the gross minimum output and deducts a pair specific swap on settlement. Basically it takes the fee out of it. Right now,

44:16you could really get lost in the sauce a little bit here with things like Merkel trees and stuff like that. Let me try to make it simple. Merkel rewards token ops and T-Rex ledger. Merkel confidential rewards came live on October 19th, 2026. Calculates vault incent incentives on encrypted balances and pays claims in confidential. Rap Zama Token Ops acquisition was a company that they bought apparently. Zama acquired token life cycle platform token ops to run

44:49confidential token vesting in airdrops including Zama's own team of venture capital unlock. So this is just how they're handling paying their employees and their venture capitalists. T-Rex ledger partnership integrates Zama confidentiality into regulated tokenized RWAS real world assets. The note here is that partner RWA value is not automatically Zama burn demand. So proven on mainet today versus future roadmap. How's everybody doing out

45:20there? You guys learning anything about Zama? Smash the like button. Throw a 111 in the chat if you've learned something already about the Zama project. Throw a 3 I3 in the chat if you own some Zama tokens. I do not personally own any Zama tokens. Live on Ethereum today. 137 million shielded total value locked and I'm not saying it came out today but as of today it is live across ERC 7984 wrapped rappers right so this is the type of

45:50Ethereum token and it's a wrapped asset 68 million plus 16 currated morpho lending vaults confidential swap the RFQ Merkel Rapzama claims and bronn cusdt payroll that might sound complicated That's just kind of wrapping up all of the things that we just went over individually and what's actually live. But what we really want you to know is what is staged in the road map. It doesn't count as done and it's not going to be our score for this project is not

46:21going to be based off of things that they tell you are going on in the future because we don't know when that's going to happen. And even if they give you a date, it can still be push back. It can still almost never happen. Sometimes it can be cancelled. things do get cancelled, right? So, you can't count on every date on a road map to be final. But what is on the road map fully confidential layer on additional

46:47Ethereum virtual machine layer 2 and native Salana apps GPU uh co-processes targeting 50 500 to a,000 throughput per second. How fast it is, right? customer fully homorphic encryption ASIC hardware targeting 100,000 plus throughput per second in 2027 to 2028. So these are updates that are coming. It's mostly making it more interoperable across different Ethereum compatible networks and Salana native apps. Of course they want to up the throughput per second

47:24because it needs to be fast and reliable during volatility. So, first will be an a big update to 500 to a,000 and then there will be a bigger update later that'll move it to a 100,000. It'll 10x it right from there. All right. Got a lot of the techy stuff out of the way. Blues guy, welcome in. Welcome in. Uh, sorry I fell asleep. This new job got me tired. That's exactly what I told everybody. You had a new job and you might be a little

47:53exhausted. So, how's everybody? Eugene, my man back at you. Welcome in. welcome in. Um, it's good to have a pay a day off and enjoy the stream with you guys. I'm so uh glad that you could be here tonight, Melissa, cuz I know you've been working a ton, but I I love having you on the stream. You always have good stuff to say and you're always highly interested in the topic, which is great for me because I spend a lot of time putting this stuff together. Uh, Plague

48:18Dog says it's super fast. Yeah, 100,000 throughput per second is pretty quick, right? Hope you guys are enjoying that digital board game. Remember, if you win and you would like to collect your $10 in free cryptocurrency, then you are going to want to be in the Discord, DM me directly. I'll let you know whatever we need to do to make sure that you get your crypto in the crypto that you want. So, users journey architecture and

48:43privacy boundaries. So, what actually happens when Maya puts the $50,000 in USDC into Zama? Remember Maya is our fictional character that we are using in our example to make it easy to understand how this works. So Mia's $50,000 in her stable coin USDC wrapped treasury manager wrapped is the the header, right? Treasury manager Maya sends 50,000 regular USDC coins, if you will, into Zama's rapper contract. She therefore will receive

49:1950,000 wrapped USDC tokens called C USDC. That's so we can tell the difference. The only point of that extra letters in front of it is just so we can tell the difference when you look in your wallet between what is regular and what is wrapped. Her 50,000 USDC entry transfer is visible on the Ethereum scan. join vault batches, right? So, first she gets her money and she wraps it so that she can be interactive with the

49:53ecosystem. Then Maya deposits her her wrapped I wanted to say staked wrapped USDC into a into a stakehouse or winter mute morpho vault. These are different brands on their vaults, right? Her individual contribution is encrypted at that point. So, they don't know exactly she put 50,000 USDC, but they don't know how much she put in to those vaults. So, the batch combines Maya's deposit with other users deposits, reveals only the combined batch total, and puts that

50:27lump sum to work in Morpho. This is why if you're the only person in that batch, you could definitely tell how much money you put into it. It's a little bit of a flaw. So, hold and earn confidential shares. So, hold and earn condu uh confidential shares, Maya receives encrypted vault shares. So, when you So, you take your money, you wrap it, then you put it into the vault. When you put it into the vault, you get shares of the vault. Only

50:56Maya and services she explicitly grants viewing permissions to, like Merkel, can read her share balances. I'm sure that's for if you run a big company and you need to prove and show that you did what you were supposed to do with the money and all of that stuff. You can give permissions to other people so they can view it. Your average person probably not doing it. Your average person probably not putting $50,000 in USDC into a vault. So

51:24a synchronous exit and unwrap. When Maya leaves, it's like everything you just did, you like do it backwards, right? She redeems her vault position with the shares that she have which requires KMS decryption and underlying morpho liquidity. The money has to be there to pull out and unwraps her wrapped USDC one to one back to regular USDC. So she gets her shares out, redeems them for liquidity, and then she unwraps her USDC. Now she's

51:59back into regular USDC stable coin. So how does Ethereum avoid freezing up here? Well, symbolic pointers here. So Ethereum never runs heavy fully homamorphic math. It only stores the lightweight pointers to encrypted vaults and updates to access control list. heavy lifting is done by Zama Blockscape P2P which is peer-to-peer um artifact and Lugana node Luga nodes I've never said that all right they verify input proofs execute the encrypted math in

52:38parallel and commit the results let's break this down Ethereum just keeps a a nice record of the light important facts of the fully homamorphic encryption math It's actually Zama themselves and Blockscape and a few other ones who are actually doing the heavy math equations and things to make sure everything is proper. Decryption. The gateway rollup checks ACL permissions and coordinates nine out of 13 threshold descriptions across Fireblocks, Ledger, Open

53:11Zeppelin, Ether Scan, Figment, Layer Zero, and Piers. So this is some interoperability here. But nine out of 13 of them have to agree in order for anything to function. What is hidden versus where is the private leaks, right? So where is where is it exposed and and I guess transparent and where is it actually private? So your wrapped USDC balance, transfer amount, vault share size, right,

53:43are actually hidden. Failed transfers. If your balance is too low, Zama quietly transfers zero encrypted tokens instead of reverting publicly. This protects you from being exposed with your information if something were to fail or for your balance is too low. Something is wrong with the transaction when it was reversed that could expose you, right? So, it just does zero in the actual amount of tokens. Melissa says, "The game is cheating me."

54:14I hope not. All right. Visible in practice. What is hidden? Where is private? C actually leaks. So visible in practice wallet addresses, timestamps, public wrap unwrap amounts, the one person batch leak. If 10 people share a 100,000 USDC vault batch, Maya's size of her portion of that is hidden. If Maya is the only person in the batch, well, the public batch total actually reveals her deposit. So to make this really simple,

54:48if there's 10 of us and we put our money in, it only shows the full amount of all of our money combined. So you don't really know. And the more people, the harder it is to, you know, deduce what the actual amount per person is or a specific person. But if you're the only person in that batch, it's pretty obvious that all the money was you. Programmable compliance versus mixers, right? An all or nothing mixer. Tornado Cash hid everything from everyone with

55:18zero programmable compliance rules leading to sanctions and institutional bans. They didn't like it. Let's put it that way. Zama's access control list, every encrypted value has an onchain permission list. A DeFi app can keep balances private to the user alone. While a regulated Genius Act stable coin issuer or bank like JP Morgan can program KYC and AML rules or auditor viewing keys directly into the contract. So everybody really wants privacy and

55:52completely makes sense, but at the same time you have to comply with the regulators. They'll shut you down like tornado cash was. Melissa says, "The game owes me mo owes me two rolls." Really? Is that so? I will give you your two rolls. I I'm not going to go back through it. I'm not sure. Uh I'm not sure. Maybe if multiple people win, it only gives one. Yeah. Uh CCP is really good at the game.

56:34He beats most people. Sometimes you'll win, but he won first, right? So sometimes you'll win, but somebody else might win before you won and they get the token. I'll still give you two roles. So where vault yield comes from? Well, the yield source. Zama does not manufacture yield by encrypting a balance. Vault yield comes from Morpho borrowers paying interest. So they're very much integrated and built into Morpho.

57:02So total value locked is deposited capital, not a protocol's revenue, not token earnings, and not an insurance fraud. I I'm coming with the jokes. The June 2026 12.5 million wrapped USDC freeze. This is really interesting because although it's a wrapped version of USDC, they still froze it. And they froze it for three days. Over 99% of all shielded wrapped USDC on Zama on Ethereum, right? Zama's product on Ethereum was

57:40temporarily frozen. So what actually happened? Well, a US core injunction targeting wallets from overnight finance exploits caused Circle to blacklist Zama's entire wrapped USDC contract because tainted funds had entered the pool. That sounds like a headache, but there's not much you can do when you're using USDC. You don't actually control the liquidity. I think that's the issue here. when you wrap your USDC, it's

58:09still backed one to one by Circle, which means it's still their product because it's still their money that you're relying on. So, what actually happened and what does it prove, right? The lesson is that FHE, fully homorphic encryption, cryptography was never broken. They didn't fail. But encrypting USDC inside one pulled wrapper doesn't remove Circle or Tether's power to freeze the underlying asset at the front door. The biggest takeaway here is that

58:39stable coins can be frozen by the issuer. Uh I'm not really sure of any stable coins that can't be. There might be some out there. I don't know if if like um Zcash has a stable coin or something like that, but for the most part, most of them can be frozen. So, shielded TVL on Ethereum, right? So, this is total value locked. It's not revenue, right? It is actual money put into applications in the DeFi and it's grown significantly

59:11even with I guess some of that bad news. So, Real Capital is using Zama's mainet rappers and 16 Morphog vaults. Zama's January 2026 Dutch auction, it's a way of of of I guess distributing things, also stress tested 24,697 encrypted bids. Briefly making Zama the number one app on Ethereum above USDT and Uniswap. briefly though just for a short period of time and then it went back to where it normally is. So the next thing is retention. Just because it

59:46got a bunch of TVL does not tell us how much capital is only here for promotional Merkel Rapzama rewards. When the rewards run out, people seem to lose interest. Deposits that stay after incentive fall deserve a much higher valuation than rented liquidity. I I feel like I go over that lesson often. says, "I'm just not good at the game. It hates me. I just feel like CCP is too good at the game." Right? So, when users pay for privacy, how much actual reaches

1:00:20the Zama token? Now, we're getting into some of the sauce about the actual token. So, do not mix up these four fees. You have host chain gas, lending yield, app level fees, and base Zama gateway fees. A host chain gas is paid in in Ethereum to Ethereum validators. Zero goes to Zama. So you can just cross that one out for the token. Lending yield is paid by Morpho borrowers to vault deposited. The zero goes to the Zama token. App level fees confidential

1:00:52swaps deducted the paired specific fees. So fees on winning RFQ quotes. The person who actually fills the order. Not every app fee is a Zama burn. And then you have this base Zama gateway fee. The only bucket priced in USD settled in Zama and 100% burned. So if you're looking for your burn mechanism, it only is around the Zama gateway fees. I'll say it again. Zama gateway fees are the only thing that's getting burned. And 100% is getting burned, but it's only

1:01:26one out of four fee mechanisms. So then we have our services here. casual and if you're on volume plans it's significantly less. So where does the value actually leak on its way to Zama? Well, Zama pays gateway fees 100% burned via protocol fee burner. The stakes and the 18 operators and stakes and 18 operators, right? So leak number one is the relayer abstraction. We've talked about abstraction a lot. Hopefully you have raised that crypto

1:02:00IQ. apps and relays pay Zama fees in the background. So, using our person in our uh example here, Maya can move $50,000 in USDC through Morpho without ever holding a single Zama token in her wallet. Volume discount. This is where it's leaking as well. At 0.008 uh what? not since per discounted transfer. It would take 125,000 confidential transfers just to burn $1,000 worth of Zama. So, you'd need a

1:02:40lot, but they're giving these to big volume people who are bringing a lot of interaction to the network. Is that a good trade-off? I don't know. What do you guys think? Put it down in the comment. Two Ethereum staking pools, right? Zama. So you have 1.5 billion Zama currently is staked right now. You have five co-processes about 40% of the rewards and 831 million Zama currently staked and those numbers are there if you need to review them. This slide will

1:03:10be organized in the discord for you to pull up and look at yourself. Rules and unbonding. So square root weight reward scale by the square root of stake. So smaller operators offer higher APRs. The team up to 20% operator commission, liquid staking receipt tokens, right, which is this STZMA. It's another kind of wrapped off asset as a receipt and a 7-day unbonding weight list. It's relevant if you're actually involved in it. So net Zama supply increase 337.4

1:03:47million. So the genesis supply was about what 11 billion zama. Live active supply has not increased that much. Hasn't been that much time either but like 11.3 right billion zama annual rewards versus burn demand. So live staking reward rate mint is about 17.4 Forzama per second to pay 18 validators whose cloud hardware costs estimated 1.6 million a year break even comparison. So require 4.8 billion discounted right transfer this

1:04:31year just to break the 5% inflation. That's how much you would need to get above the inflation. So let's talk about the supply, the actual unlocks, the governance and the security. I told you we deep dive things in in depth, right? We don't just go around it because somebody might watch this video and really uh want to get into a big stake into a project, whether it's this one or any of the other ones that we do. And it you'll find most videos you watch, they

1:05:03just give you a lot of like quick factual talking points, but they don't outlay the whole ecosystem product as best we can without making this a 5hour stream. So here we are. Supply unlocks governance and security. Who owns the locks? 77.5% and what happens February 2nd, 2027. Uh-oh. Unlock cliff, anybody? So let's get into some of this. Although we did go over it earlier, right? 77.5% of all Zama tokens remain locked or

1:05:35outside the reported circulation and max supply is uncapped. It is infinite. Right now 181 roughly market cap. It dipped a little bit and 85 million fully diluted value which fully diluted value for most people is highly unrelevant. Reported total supply valuation is 4.4 four times the circulating valuation at about 0.071 per token about 7 cents. So who got the 11 billion Zama? Well, the public sale an auction only 12%. Token generation

1:06:13event campaign so campaigning to let people know that the token was coming out about 6% or 660 million. Liquidity that was left here was about 220 million. 30% went to the foundation vesting daily now. So 3 billion Zama, the treasury 20%. Growth got 10%. And 3.7 million Zama a day unlocking currently coming out as new emissions. 50% insider behind 12 month cliff. That's where the majority of it went to

1:06:50your venture capitalist, which is another thing where it's kind of like people hate venture capitalists because they sell when they're up. They're always up because they buy the tokens at a huge discount for being first to give liquidity for the project to build and actually do what it's supposed to. It's a whole thing. Is it good? Is it bad? I don't know. Without the funding for some of these venture capitalists, some of these projects

1:07:15would never even exist. So the team so inside of that 50% the team got 20 venture investors also got 20 and angel investors got 10 from my understanding venture capitalists are usually companies angel investors are usually like a specific very wealthy person so let's get into the unlock cliff right 550 million Zama on February 2nd 2027 10% of the 5.5 billion insider allocate ation unlocks at once, equal to about

1:07:5121.5% of the entire current circulating supply. What does this tell me? Just thinking out loud, never financial advice. I wouldn't touch it until the unlocks are passed or unlocks February 2nd, February 3rd. They could be good times to maybe scoop some. If you're interested in the project, which so far I have to say personally, I don't know that I'm all that interested compared to other things that we've been over. Shout out that Flare uh deep dive that we did.

1:08:21Shout out Flare and a few other tokens that we went over that made me very highly bullish on them personally. Plague Dogs got some Chinese takeout. Is that what you're trying to tell me? You got some Chinese takeout? That's hilarious. CB, you're killing me. All right. Unlocks after the cliff. Daily linear drip more than doubles. Right. So, jumps from 3.7 million Zama a day to 9.2 million Zama a day. Distributed confidentially via Zama's

1:09:00acquired token ops platform. on February 3rd. So, from a tokconomic standpoint, I'm trying to understand what are we even doing here. So, first we're going to have a cliff unlock all at one time. All at once of 5.5 billion tokens. That's already wild. And that is February 2nd. The next day, they're gonna double the emissions from 3.7. That's way more. That's more

1:09:40than double. I don't know why it says doubles on February 3rd. Jumps from 3.7 to 9.2 million Zama a day. Roughly $653,000 worth of value daily coming out in emissions. That's I hope they have some big contracts coming up or something like that. So, the staking headline needs context, right? Why ne 97% staked is an illusion. 2.3 billion staked, 554 million in

1:10:15bridge rappers and Binance, 2.9 Zama billion Zama, which is 357 million more than the entire 2.5 circulating supply. Uh-oh. Translation: locked Foundation operator tokens are staked inside the pools and harvesting the 5% liquid Zama rewards. So getting paid even though it's locked founders and research bench right so these are people who are affiliated with it. We have this Dr. Rand Hindi who's the CEO

1:10:52funded AI privacy startup SNIPS was acquired by Sonos in 2019. Dr. Pascal Pelleier, I'm doing my best here, is the CTO, invented the Palier crypto system in 1999. Wow. 2025ACR fellow. And yeah, more accolades. They have 40 to 50 PhDs actually working. Which is weird because if it was just one big scam,

1:11:31would you spend 5 years to build it and have all these very highly qualified people? Would you have 40 to 50 PhDs on the payroll? That doesn't sound cheap. I would imagine they probably make something close to a million dollars a year at least. Very, very interesting as far as the perspective of I seen on X and it is what it is. I saw people on X um circulating a list of coins that are most likely scam coins and stuff like

1:12:02that and so they put Zama on there. I was wondering about that. Uh, Zachariah, you have to put the exclamation point in front of the roll, just so you know, or otherwise it won't do anything. That exclamation point is kind of the key to to everything here. So, world class team and 182 million has been raised, right, from your seed phrases and things like that. Operator governance, not token democracy. So, who

1:12:37votes in the DAO? decentralized autonomous organization. Zama's Aragon DAO gives equal voting weight to the 18 operators, one to two majority rule. Buying more Zama gives ordinary token holders zero governance votes over fee prices, inflation rates, and contract upgrades. So there's no governance for your average token holder. The governance is all ran by the operators which who have they have a large stake and they probably have multi- millions

1:13:11of dollars in hardware and things to keep this thing running. But they do have an emer emergency circuit breaker, right? Any any single operator can trigger an emergency pause on minting, ACL updates, input verification and decryption. Unpausing or blacklisting an address requires an operator governance vote. So they can't blacklist you, but they can pause things individually. Type roll token win. Yes. Okay. I don't know that you get it,

1:13:50but that's fine. Uh fully homorphic encryption smart contract rivals. Now we're getting into competitor mode and alternatives. So who are their competitors? Well, we have this Phoenix and Inco Zama's TFHE powers 70 to 90% of cryptos fully homorphic teams and has the deepest live Ethereum and Morpho integration. So wait, are these aren't rivals? Yeah, contract rivals. Okay, this is very I'll

1:14:29admit this the way that this is worded and stuff is quite confusing. Uh ZK and institutional privacy rails, rail gun, Aztec uh private ZK privacy cheaper in its simple transfers, right? Harder for shared multi-user state, Canton CC and Zcash are all competitors here. So the patent licensing catch, Zama holds 30 patents and sells commercial software licenses, but those licensing payments go to Zama the company, not Zama, the token holder.

1:15:05Security and audits, right? Cryptographic and audit strength 34 plus audit week across Trail of Bits, Zenth and Open Zeppelin. So there was a bunch of audits, right? 13 institutional KMS nodes, nine out of 13 threshold. We went over that earlier, and five co-processes with public fault challenges. Now, I know sometimes this gets a little bit intricate, but it's like trying to explain to somebody from a low education, literally like a third world

1:15:35country or something like how an airplane does everything that it does, like a modern airplane, right? um in simple terms. At some point, you're going to have to say something that there just isn't simple terms for four security caveats to know. Audit scope uh nuisance or nons, right? Open zeppelin's March 2026 audit covered the base ERC token library while live mainet rappers use a custom upgradeable port. This is a security thing, right? AWS

1:16:13Nitro Enclaves, Amazon Web Services. All 13 KMS nodes currently depend on AWS Nitro hardware. No slashing in the code yet. Automatic slashing is not yet implemented. So right here, talk about centralization. The entire KMS nodes depend on Amazon Web Service. So if they go down, you're out. Four security caveats to know. Zama runs nodes in both sets. Zama operators, right? In both sets, right? Zama

1:16:52operates one out of five co-processes and one out of 13K. So Zama itself actually has one of each probably so they can keep things going. Keep these three exits separate. So selling Zama on the open market. Redeeming stake Zama requires a 7-day unbounding process unless secondary market liquidity develops for operator specific wrap Zama receipt tokens. Most people you're going to require 7-day unbonding process. Withdrawing from a

1:17:21confidential vault depends on batch processing, KMS decryption availability, underlying morpho borrower liquidity, and circle tether not freezing the rapper contract. So, you got some things that could be variables if you're trying to move a large money in and out. Treasury verse the 23x operator subsidy. Zama, the company raised 150 million in equity auction cash. The protocol holds 20% treasury and 10% growth. Token reserve whose dollar value moves with

1:17:52Zama and is increased liquid supply when it is spent. Uh delivered milestone so far and next catalyst. So this is our catalyst section. This is actually how we score the projects in these specific categories, right? Already delivered, right? So it gets credit for already being live. Ethereum mainet launch happened in 2025 and 121 million encrypted uh actions. 137 shielded total value lock and 16

1:18:24curated morpho vaults that went live September 2026. confidential swaps, the RFQ and in October 19th, Merkel wrap Zama confidential reward claims. So they get points for that. What do we watch for next coming up for Zama? Well, first off, you have post incentive morpho TVL retention Xeron or Utila, I don't know how I'm supposed to say that. Wallet integration, GPU processing up. We talked about this

1:18:56upgrade to 500 to a,000 throughput per second and a layer 2 Salana confidentiality rollout. Scheduled risk 3.7 million Zama a day linear unlocks. And of course the February 2nd 2027 insider cliff jumps to 9.2 million Zama a day. Okay. So when you I believe what this is saying is that when you add the unlock cliff the new tokens coming out for the unlock that's why you get such a high amount of Zama a day. That makes more sense than they just randomly

1:19:32increased it at the same time that they unlock tokens for their venture capitalists and team. Confidential scenarios, not price predictions. So, first off, you have the bull case, right? The Genius Act makes confidential stable coin balances standard on Ethereum. Sticky vault total value lock scales to billions and the operator DAO cuts the 5% inflation rate before February 2027. That would be very bullish. The more neutral case is that

1:20:02Zama's product succeeds as Ethereum privacy layer while 99% fee discounts, relay abstraction, and 5% emissions and insider locks keep the token lagging product growth. So basically all the things that we talked about with the unlocks in in the abstraction, the apps paying the fees, the big apps getting this huge discount in fees, so there's less revenue generated is kind of a neutral case. What's the bearish case? Well, Vault TVL leaves when the Merkel

1:20:35rewards fade, which is a real likely scenario. and 550 million year staking inflation plus the 5.5 billion insider unlock wave overwhelms the market demand. Is it a good time to buy it or is it something that you're going to be glad you didn't touch? That's your own decision. You do what you want with your money. Never financial advice here. So, Green Flags things that Zama has done well. Well, it solves a real enterprise

1:21:03and DeFi problem on Ethereum without moving chains. 37 million live shielded total value lock 16 institutional morpho vaults that's real product right and real byron I don't know how you supposed to say that bon uh payroll usage world class fully homamorphic team so 100% fee burn in the code but that's only for the one fee generation there's four and only one of them has the 100% % fee burn. Red flags. Well, 337 million

1:21:42net token inflation since launch and somehow it's still up. That is 39 million year mint versus 1.8 or 1.68 million year hardware cost. 99% volume fee discount is a huge discount. Relayer fee abstraction. You got 77.5% lock supply. the February 2nd 2027 5.5 billion insider cliff unlock vested confidential via token ops. So it'll be confidential who it goes to but we know how much is being unlocked locked token staking operator only DAO meaning if you

1:22:23hold the token you get no voting rights and no code slashing yet. So, these are all negative things against Zama, which really is kind of the focus when I've heard some negative things out there. That's what I wanted to know. Now, I am highly more educated on Zama if anybody ever asked me. The four layer privacy lesson and the final scorec card, right? How does Zama score across all seven categories? Our weekly lesson here is evaluate

1:22:52privacy in four different layers. This is some extra sauce for my undergrounders here. So the data, what is actually encrypted, right? What is encrypted? Balances versus leaks and actual real practice things that are exposed. Permissions, who controls the access control list? Who controls the access control list? Did it say that twice? Oh, cuz one's in the header. Okay. And the operator pause button or the underlying USDC blacklist.

1:23:24Economics. Do distributed protocol fees uh actually burn more tokens than staking inflation? Is it inflationary or deflationary? An exit. Can you exit the token? The 7-day staking pool and the confidential vault cleanly win incentives in. So when the incentives in and everybody rushes out, everybody's going to be waiting seven days. So the the the strongest counterargument I always like to have this section

1:23:57because this is basically what you need to kind of negate everything that we just said and it's worth doing to be as transparent as we possibly can in this deep dive. Every major infrastructure network look expensive early on. Tech a lot of times gets subsidized. A lot of money upfront goes into investing into something to get it up and running and get all the connections, get everything going before they turn on that, you know, revenue generation. Giving apps a

1:24:2699% fee discount and subsidizing 18 institutional operators is how Zama has attracted 137 million in their shielded TVL and 16 Morpho vaults in under a year. huge discount in reward to come over. But the DAO can lower the 5% emission rate once Zama becomes Ethereum's default privacy layer. So that would make it less inflationary and also they can up the fees later too. They could pretty much do what they want. The the company

1:24:58pretty much has full grasp over this entire product. That argument earns Zama higher marks on utility with the moat has high marks as well. 14 out of 15. It earns a higher token score only when the onchain evidence actually catches up. Retain total value after the rewards end. Rising fee burns and lower inflation rates before the February 2027 cliff is what you would need to see. So here we go. Utility and adoption. There's only seven categories. Got 18

1:25:33out of 20. That's a pretty good score. Token value capture got a 13 out of 20. Tokconomics and supply got a 7 out of 15. The competitive mode got a very high it they have a lot going on in a lot of tech. 30 plus patents, 40 to 50 people on payroll with PhDs and stuff. and their co your you know CEO CTO all those people are um wellqualified people doesn't sound like the type of building of uh you know company

1:26:12employees that you would do on a scam coin security decentralization man I can't even talk six out of 10 catalyst and execution got an eight out of 10 that's a good score and risk and unanswered questions a five out of 10 which honestly Most things rather get a four, five, or a six on unanswered questions. What do we not know yet? Now, the actual breakdown for each category and how it

1:26:36got scored is going to be inside this PowerPoint that you can look at yourself as soon as it's up in the Discord. I'm not going to read it because it's super repetitive. It just puts it all together in each little section, right? I don't want to do that to you guys and just read all of this all over again. So, our final verdict is a 71 out of 100, which is not a bad score in all technicalities here. We have three projects now that have passed the token

1:27:09autopsy out of like 27 that we've done. So, that tells you token autopsy is not super easy. A, Uni, and Link all passed with A and Uni getting an 82 and Link barely passing with a 79. That's the lowest you can get to pass in my opinion. I think anything above a 70 is worth maybe investigating if you're looking to speculate in the market. That's the real point of all this token autopsy is to create a leaderboard that gives you a

1:27:41quick reference to what you might want to look into more to educate yourself or raise that crypto IQ as I always say. Then we got the watch verdict. So past verdict is 79 and above. Watch verdict I believe is 69 and up. That might not be right here. It should give me a breakdown. Where's my breakdown? No breakdown. Usually we have the breakdown. Anyways, uh the point is you have a watch verdict. Yeah, 64 and up gets you watch and then anything under

1:28:11that is pretty much just speculative and that that tells you where you might want to dig deep and try to get a real winner in that speculation or do you want to have less risk tolerance and risk less risk overall in your portfolio? That is for you to consider. do what you want with your money. And it's just rolling into 10:00. Let's go back to the news for today. I knew it was going to be a pretty heavy

1:28:45project to cover. When you have terms like fully homorphic encryption, you know, you're going to learn some stuff, but you don't raise your crypto IQ by just hearing the same things you already know over and over. So, if you sat through that and paid attention to even 75% of it, hey, you're a real undergrounder. You deserve some MVP points, just like Melissa apparently deserves two free rolls. Let me do that now.

1:29:27All right, that should give you two tokens. It is heavy. Um, it's like if you're just here to get some general information, just kind of pay attention to what makes the most sense. Let me present it. Let me do the talking type of thing. let me give it to you as simple as possible, right? And then you'll soak up the easy information, right? And then later on, if you're

1:30:09like, "Okay, I I really I really am very interested in whatever project." Then you could go back and find it inside our Discord and stuff. I'm still putting those out. Um, and then you could like go back through the slides, read it yourself to really upgrade and get a hundred as close to 100% of the information we put out as possible. But I just don't want to do something, and I've thought about this a lot and I'm still working on it. I don't want to

1:30:34do something call it like a token autopsy or a deep dive research and then give you, you know, 18 slides with some facts. Like that's that's not going to deliver on the promise that I've given. I feel like I do a pretty good job of giving you real information, but you got to be ready to receive it. You got to raise that crypto IQ with us all the time. That's why we did a long time of just topics, right? Ecosystem deep dives, but also just explaining

1:31:01pretty general um you know, definitions. What is a layer zero? What is a layer 1, two, or three, right? Just simple stuff that we did for like a year just to get people up to base just to build that database of information. Melissa says, "It was heavy project." Yep. Thank you for the info. Absolutely. For the number hunt. I thought I could guess many numbers. Oh, okay. Got you. Thank you. You're welcome. Still give you two rolls just so you can compete

1:31:31here with CCP. Let's go ahead and do anybody can do this, by the way. Exclamation point board. And it will tell you where everybody sits. It is up in the corner, but maybe it's a little bit small. I'm actually probably I don't know. I don't know if I want to get rid of that or not. Up in the corner. Well, let's do a couple news stories while we're here hanging out. Bloom Trading users had 9,48

1:32:00soul drained in about 94 seconds. And it's today's second story. And it's even more cryptonative. Someone actually drained 9,48 soul about a little less than a million953,000 from 48 wallets belonging to nine Bloom trading users. Bloom is a Telegram trading bot commonly used by Salana traders. I have no idea cuz I don't use this. The onchain behavior is pretty revealing. These were not malicious token approvals. Each transaction was

1:32:35signed using the actual private key belonging to the affected wallet. That is highly interesting. That means revoking approvals wouldn't have saved anybody. Whoever carried out the attack apparently had the keys. Some affected wallets reported hadn't even traded through Bloom for more than a year. So, they picked up this stuff a long time ago. Bloom is investigating whether a third-party provider was compromised, has paused some services,

1:33:05and says it will fully reimburse the nine affected users. That's very good on them. That's very good for user confidence, right? The exact root cause has not yet been confirmed. This gives you a great talking point about Telegram's trading bots. Well, thank you. I don't actually need a talking point about trading bots. They're fast because users don't approve every transaction manually. But for a bot to do that, something somewhere has access

1:33:35to signing authority. Note to self, if you have a wallet and you use one of these things, you like using it, maybe you made some money, maybe you keep all the rest of your money, just like a centralized exchange. This is just a thought, right? Not advice. I would probably keep a wallet with what I'm actually trading with, willing to lose, risk management, and then I keep everything else somewhere else, right? Convenience didn't eliminate the custody

1:34:01risk, right? Cuz why did they have this already pre-approved so the bot could operate quickly? It moved the risk somewhere else that the user doesn't actually see. A wallet can technically be self-custody while an external trading service still processes enough key material to empty it. And that's an important distinction. Aviva puts tokenized share class of its and this is like European pound right uh 22 billion fund on XRP ledger.

1:34:30This is going to make the XRP people bullish. So Aviva investors launched a tokenized share class of its sterling liquidity fund on XRP ledger working with Ripple. The underlying fund manages roughly 22 billion pounds about 29.4 billion in US and is Aviva investor's largest fund. Important distinction here that 22 billion did not suddenly move over to XRPPPL. Aviva itself invested 50 million or50 million pounds about 66 million uh

1:35:06US into a new tokenized share class combined with earlier tokenized US fund. Aviva now has more than 86 million invested across its tokenized offering. This uses this uses a digital twin structure. So a traditional fund continues operating normally offchain. that BNY Melon holds the fund assets. The investor shares in the funds can now be represented on the XRP ledger. Eligible investors receive essentially the same investment objective, liquidity

1:35:42characteristics, and regulatory protection as a conventional investor. That considerably more meaningful that is considerably more meaningful than creating some random token that acts that tracks a fund's nav. If you're not accustomed to this type of stuff, that probably didn't make a ton of sense. Just know that XRPL isn't replacing the 22 billion pounds of EVA funded. It's becoming a new ownership and settlement layer for regulated

1:36:10shares in that fund. It's bullish for Ripple and XRP. Hong Kong switched a switched on 24/7 secondary trading for regulated tokenized funds. And this is something that you're going to see also with Wall Street here in America at some point if they haven't already. 247 trading is coming to Wall Street. And this will be probably the last story that I do here. It's a big step for actual tokenization. Hong Kong Securities and Future Commissions

1:36:39approve secondary market trading of regulated tokenized public funds on licensed crypto trading platforms for the first time. Two existing China AMC tokenized money market funds began trading around the clock today through Panther Trade and SFC licensed virtual asset trading platform owned by Futu. And if you're not in the Hong Kong market, it probably doesn't matter to you. That's a key difference from simply tokenizing a fund. Previously, many

1:37:10tokenized funds still retain traditional financial market restrictions, right? Subscribe, wait, redeem, wait again. Now these regulated funds fund tokens can actually have 247 secondary markets. That's the biggest takeaway. US regulators are moving ahead without waiting for the Clarity Act, which is very interesting in and of itself. All right. Did I do a good job on the Zama token autopsy? Again, a moment of silence for Reliable Jay.

1:37:42I'm going to miss him for real. Very, very sad stuff. If you didn't hear, Reliable Jay is no longer with us, unfortunately. >> Did I cover everything that I wanted to cover here? Oh, yeah. Follow me over on X >> where I post uh a lot of news all the time. This one did really well. I gotta like my own stuff. Nobody else going to like it. I'mma like it. Oh, there's a couple likes there. I'm glad

1:38:19that this post at least got 23 likes and three reposts, right? Anyways, let's just grab a random one. Right. Uh, Toto Finance ask Cardano's treasury for 22 million. And I'm not sure what this money value is. An a with a cross. Is it? I don't know. Is that Australian money? But anyways, they asked ADA for this to buy copper. The treasury takes the metal risk. Toto keeps the business. Interesting stuff. A one-time withdraw

1:38:53about $5 million to buy Comx grade one copper. Tokenize it. One token, one pound of copper. Hold 18 to 24 months. Sell and send the net proceeds backed by 36. And I I think they're going to do well. I think copper will go up. Now, will it go up as fast as it's supposed to? >> Maybe not. >> Melissa says, "Yes, the autopsy was great." Thank you very much. I appreciate that. I really do. Uh ZCP

1:39:31said, "WTF reliable Jay?" Yeah, he he passed away yesterday or the day before. or I'm not exactly uh h sure I I don't I don't know if it's a big deal if I say what happened. It wasn't anything like crazy crazy. He he had a seizure. That's about as much as I know as he had a seizure and it and it damaged his brain and that was that was that I don't know all the nitty-gritty details, right? That's about all I know

1:40:06>> as I haven't personally spoken to his his wife or anything. I just got kind of got secondary news from a good source and it's sad. I I could I couldn't say that enough. It's it's very sad. Just wanted to make sure everybody knows because he used to come to the stream. He was very reliable. He'd come to the stream all the time. He interacted a lot. He played Kendra with us. I I knew him per a lot more personally. I hung out with him in Miami around the Bitcoin

1:40:36convention and the Crypto Lifer meetup. Um I'll always remember going to the meetup with him. He uh you know he he completely invited me out there to the Miami Strip to hang out with him. He had a hotel and uh he pretty much paid for that whole thing and I never asked him to do that. He was a really solid, generous, kind dude. And uh it's a real shame. I just want to give him that credit. Like he he really he really looked out and just invited me out and

1:41:10uh just took care of everything. And I never I never would ask somebody to do that. That'd be a weird thing to ask somebody, but he offered and I took him up on it cuz I wanted to meet and get to hang out with him more. And it was just a really amazing time. And I'm just really sad that uh that's that's not going to happen again because we we had planned, you know, for other events and things like that, maybe to go out to the Vegas event and things like that. He had

1:41:35said, "Hey, anytime I'm out there, I have a hotel. You can feel free to come hang out, save you a couple of dollars." So, I was really looking forward to a Vegas meetup and all kinds of other things. It's It really is sad. It hit me hard. Yeah, I didn't know Reliable Jay, but see him here. Yeah, most people would have known him online. I mean, even his uh ex account was reliable Jay and I don't think he posted a lot of pictures

1:42:00of himself or anything. He would always use like a frog similar to like a Pepe character or something like that. He had a whole thing about that. It it is really sad. I'll probably, you know, continue to say, "Hey, let's remember and let's remember him and keep his family in our thoughts because, you know, he had two little girls and things and I have three kids. I understand how hard that must impact a family. Melissa says, "I wanted to meet him and

1:42:27the rest of you guys in Florida, but now I can't." Yeah. Hey, life is fragile. You know, that's why every day, everything we do, we need to put some thought into it. And like somebody who that I listen to a lot, they say, you know, you don't know when your last day is. And if you spend a lot of time grumbling, complaining, and just being negative, there's a good chance that your last day on this earth is just going to be filled

1:42:50with you grumbling and complaining about things that are most likely not that big of a deal. So, you might want to think about that in depth. I'm not trying to preach to you, but how would you feel if your last day was filled with negative grumbling and complaining and not being grateful for what the life you do have, you know, and then that's the last day? That would really suck. I think that would hit hard. Just some food for thought. But anyways,

1:43:16guys, I think I'm going to wrap this up. I appreciate everybody who came. You know what it is. We'll be back tomorrow night. And tomorrow, I had already told somebody that we would go over a certain coin tomorrow. And of course, I I kind of already uh forgot which coin it is. You'll have to forgive me. I'm very tired, honestly. Let me see if I can find out what coin it was that we will

1:43:41be going over tomorrow. Any other time it would come right to my brain, but because because of that couple hours in the gym before the stream, I'm a little fried here. And then we just read an entire Zama token autopsy. Feeling it. Uh if anybody was in the Oh, by the way, free link to the Discord for anybody. Most of you guys are uh natives here, but definitely

1:44:16be in that Discord cuz people were posting about this as it happened the other day. >> Or as I guess the news came out, right? What coin was it? I should have wrote it down. I know it's here somewhere. You know what is it under socials? No. All right. I really wanted to tell you guys what it was. Sometimes when I'm really tired, I'll scroll past the information I'm looking for like 17

1:44:49times before I actually find it. Anybody know who was it that I talked to? I told you I'd go over it tomorrow. I think it might have been Seeker. Yep. See you guys back at work for the rest of the week. You will be missed. Melissa, I will certainly certainly miss you. Was it Melissa? Was it you that I was talking to? Who was it that I was talking to? And I was like, I'll go over that tomorrow.

1:45:30I think it was somebody else cuz it was Zama that I went over. You were the one that reached out and said, "Hey, I'd like a token autopsy of Zama." If you reach out to me, one, you can always speak to me, you know, through the voice chat in our Discord. You know, we can have a phone call. Seeker, I I would like to chat with you a little later. It was cake. It was satseker. Okay. We're going to go over the cake token tomorrow. And I'm going to write that

1:45:56down. I have a glass top desk. So, right, let me write it in multiple places. I don't know why I'm so forgetful when it comes to this. Melissa says, "I will jump in when I can." It was Seeker. Yeah. Thank you very much for everybody who's here. Again, I appreciate all my undergrounders. I consider us at a time like this talking about the unfortunate

1:46:29thing with the reliable Jay and what happened. Um I consider you guys family. Shout out to all my undergrounders. We're going to stay well connected. Again, if you're ever around and you want to chat about anything, especially cryptoreated, I'm not going to tell you what you should do with your money and where you should invest. That's not what this is. But anything else, crypto or un unrelated, uh just drop something in the main hangout. Say, "Hey, I'm in the in

1:46:54the voice chat. I want to chat." Something like that. You can DM me. We can set up a time. Just so everybody knows, I am I am available. And in my opinion, it's one of the perks of a small channel. It probably will not always be like that. Now, is that a year or two or three year? I don't know. But it probably won't always be like that. So, if you'd like this to talk about something, you have a lot of interest in crypto stuff like that,

1:47:20please uh please let me know. CCP says, "Thanks, Underground." Absolutely. You guys are all welcome. I love to do it. And uh I'll catch you in the next one. Stay underground. Stay crypto. Maybe think long term. I will catch you guys in the next token autopsy of the cake token tomorrow night. Join us then. Underground crypto out. RIP reliable J. We will always remember you.