Hi all, happy Christmas Eve. I know you have lots of festive activities ahead, so today will be a short one. As an early Christmas present, we rant about token holder rights and Solana’s block building future.

In the current crypto ecosystem, most tokens (yes, even governance tokens) do not grant investor rights akin to what equity holders receive in traditional markets. Unlike shares in a corporation, which confer claims on profits, voting rights on material corporate actions, and legal protections under securities law, governance tokens mainly offer protocol-level voting power and speculative upside. To highlight how unfavorable this is, large institutional investors, like pension funds or mutual funds, often hire third-party firms to help them decide how to vote on shareholder resolutions and board elections. This is known as proxy voting, and the fact that institutions pay to pass on this right implies that voting may even have negative value (I’m being a bit tongue-in-cheek here, but the larger point still stands).

Without enforceable rights to cash flows or dividend-like mechanisms, these tokens structurally resemble memecoins with governance bells and whistles rather than true financial instruments. This is where mechanisms like token buybacks become so important. A buyback, when executed by a project, signals to the token holders that the team is actively committed to value accrual and recognizes the importance of their investment. It's a tangible demonstration that the project cares about its token holders, unlike the oft-seen scenario where teams move on after an ICO without continued engagement in building value (like my group chats).

However, this realization is something that takes time. A clear example can be seen in the recent prop AMM, Humidifi, which released its WET. Not only does WET not have a claim on the cash flows, it also has no governance rights, and the team itself says that it should not be viewed as an investment. However, it’s the only exposure to prop AMMs, so speculators investors are going to do what they do best, and I don’t blame them. 

In 2025, this theme has been reflected in broader market behavior. At DAS NY in March 2025, there was a panel which spoke about how equities would be the best vehicle for upside exposure to crypto. So far, this thesis has played out, with COIN, HOOD, Figure and mining stocks outperforming many tokens. Traditional equity investors benefit from clear legal rights, access to financial reporting and participation in company profits, factors that have contributed to relative performance resilience in 2025.

Looking forward, the future may lie in tokenized equities, digital assets that embed investor rights, claims to cash flows, and governance consistent with traditional securities, but with the efficiencies of blockchain settlement. For crypto markets to mature and attract long-term capital, tokens must evolve beyond speculative governance assets toward structures that offer economic rights and legal protections. This convergence would make tokenized instruments look and function more like equities, bridging the gap between the promise of decentralized finance and the expectations of institutional and retail investors alike. Buybacks, cash-flow participation and transparent governance tied to real economic outcomes will be central to this evolution. This will take time, as all regulations do. In the interim, better communication, long-term focus, value accrual and investor relations must be prioritized. 

— Marc

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Harmonic opening Solana’s block building market

Solana is entering a different phase of its scaling story, where the limiting factor is no longer raw throughput, but market microstructure. The network has now shown it can handle real stress, with proponents arguing it is capable of orders of magnitude more than it uses today. Application requests have shifted away from basic reliability and toward execution guarantees, faster inclusion and explicit sequencing rules, the kind of features you normally associate with mature electronic venues rather than blockchains.

Harmonic is Temporal’s attempt to meet that demand by turning block production into an open, competitive marketplace. The bet here is if multiple specialized builders compete to serve applications, and validators can choose among them, then performance and predictability should converge toward what applications actually need. 

Application controlled execution (ACE) is a key concept in Solana’s “Internet Capital Markets” roadmap. It allows applications to express how they want their transactions handled, such as taker speed bumps, priority handling, and other sequencing constraints that applications use to reduce adverse selection and improve spreads. Harmonic references ACE support, positioning itself as an open builder market that can integrate ACE capable builders. 

Jito BAM and Harmonic operate at adjacent layers of the same block production stack. BAM is a specific ordering and scheduling pipeline, with an ACE-style plugin framework that produces ordered output for validators to execute, being one path to app level execution control. Harmonic is a higher level open builder market that aggregates block candidates from multiple builders, including Jito/Jito-BAM, Paladin, and Temporal’s own builder. Hence, Harmonic makes block building contestable at the distribution layer, so validators can source blocks from multiple builders without committing to a single-end to end client stack, which erodes the moat Jito built. We have seen Jito tips compress as a share of REV, as SIMD0096 made priority fees more attractive for validators, so incremental block building competition here is an additional headwind for Jito investors.

This open builder competition also reframes how value accrues. More builders competing to deliver the best blocks should raise block quality and validator rewards, but the stated intent is to do it in a way that is healthy for applications rather than extractive in the short term. If builders chase value in ways that degrade UX, they risk killing the profit pool they are trying to tap. 

The key watch item is the impact on Solana’s applications. While Harmonic should support validator revenue, the real test is whether application activity and application revenue continue to outpace REV, which we view as a stronger indicator of long-term network success. This should help Solana applications approach app chain execution quality while still benefiting from Solana’s monolithic liquidity and composability, effectively delivering the best of both worlds. If so, we think the market could start to view execution quality as Solana’s core moat, pulling more top tier builders into the ecosystem.

— Sam

1. ZKsync and Grvt: Enabling Composable Perpetuals

Perp DEX design has been a sequence of compromises: AMM perps preserved Ethereum composability but concentrated LP risk, hybrids regained CEX-like latency with onchain settlement, and specialized chains delivered fully onchain CLOB performance while isolating liquidity away from Ethereum’s $122B DeFi collateral. ZKsync Atlas is the next step, enabling sub-second proof finality and cross-domain margin so venues like Grvt and Lighter can access L1-native collateral without bridging, shifting the competitive axis from pure speed to unified liquidity.

2. The Nu Era of Banking

Nubank has scaled to 127M customers with a sub-$1 cost to serve, driving industry-leading profitability and a 31% ROE. Its model blends rapid monetization, strong operating leverage and expanding verticals, from AI-driven lending to crypto, insurance, telco and premium offerings like Ultravioleta. With 6.6M crypto users and new stablecoin payment pilots, Nu is becoming a major digital-asset gateway in LATAM. Despite rising NPLs and rate volatility, its efficiency and growth momentum support upside potential.

3. Sui: Differentiated Architecture Enabling Emerging Catalyst

Sui is a technically differentiated L1 with an object centric architecture and full stack that expands what a monolithic L1 can support. It targets high throughput, low latency execution for fully onchain CLOBs, BTCfi, and new TAMs in gaming, robotics and agentic AI, while keeping liquidity and composability on a single base layer. BTCfi rails via Ika and upcoming Hashi, plus native stablecoin initiatives with Ethena, BlackRock and Bridge, aim to position Sui as a BTC and stablecoin hub. SUI is a high risk, venture style bet with a credible path to becoming a higher value execution and settlement layer.