---
title: 'Why America is falling behind in crypto'
source: 'https://youtube.com/watch?v=4ht7vt0EcpM'
video_id: '4ht7vt0EcpM'
date: 2026-08-01
duration_sec: 892
---

# Why America is falling behind in crypto

> Source: [Why America is falling behind in crypto](https://youtube.com/watch?v=4ht7vt0EcpM)

## Summary

In this episode of The Daily Wolf, Scott Melker covers how crypto markets are running ahead of traditional finance — from synthetic pre-IPO bets on Chinese chipmaker CXMT trading at a 6X premium to Stripe's $53B offer for PayPal. He also highlights how Japan, the UK and South Korea are advancing crypto-friendly legislation while the U.S. stalls on the Clarity Act, plus New York's AI data center ban and MicroStrategy's latest capital move.

### Key Points

- **Crypto pre-IPO bets on CXMT before Wall Street** [01:07] — Hyperliquid traders can take synthetic pre-IPO positions in Chinese DRAM maker CXMT, the biggest chip IPO of the year, while Wall Street has to wait 12 days. The contracts trade at several times the company's own valuation.
- **CXMT IPO pricing and Hyperliquid premium** [02:00] — CXMT priced at 8.66 yuan per share, raised $8.5 billion at an $85.5 billion valuation. On Hyperliquid, the valuation reached roughly $535 billion — a 526% premium over IPO price.
- **Synthetic contract, pure bet on opening** [02:46] — The pre-IPO contracts carry no share ownership; they are a pure bet on where CXMT opens in 12 days. Melker frames it as crypto doing global, instant, permissionless price discovery Wall Street structurally can't.
- **Stripe and Advent offer $53B for PayPal** [04:33] — Stripe and Advent International reportedly made a $53 billion takeover offer for PayPal, taking it private in a 50/50 split. PayPal's stock soared, though it has fallen far from its $360 billion 2021 peak.
- **Stablecoin consolidation: PYUSD, Bridge, Tempo, OpenUSD** [05:40] — PayPal launched PYUSD early. Stripe bought Bridge, built the Tempo layer-2 blockchain for stablecoins, and leads a 140-company OpenUSD consortium. A deal would consolidate all that stablecoin infrastructure.
- **Japan cuts crypto tax to 20%** [08:10] — Japan's Diet passed amendments reclassifying crypto as a financial product, cutting the tax from 55% to 20% and laying groundwork for spot ETFs and insider trading rules.
- **UK adopts no-gain-no-loss DeFi tax rule** [09:16] — The UK will treat DeFi liquidity pool transfers as non-taxable events — no capital gains until funds are sold. It's part of a broad UK push on stablecoin and DeFi legislation.
- **US Clarity Act faces corruption charges** [09:54] — Senate Democrats called the Clarity Act a corrupt bill, and the expected final version contains no ethics language. With only weeks left, three more Democrats oppose it unless Trump can't profit from it.
- **New York bans large AI data centers** [11:27] — New York became the first US state to pause environmental permits for data centers drawing 50 MW or more, via executive order. Melker links it to the state's earlier Bitcoin mining moratorium.
- **MicroStrategy sells shares, not Bitcoin** [13:11] — MicroStrategy sold MSTR shares to raise cash for preferred dividends and extend its runway. It still holds over 4% of all Bitcoin in existence.
- **Bullish news may not move price until Q4** [14:29] — Melker notes crypto adoption and favorable news are building while price lags — a pattern seen in past cycles before a Q4 ramp.

### Conclusion

The episode argues that crypto is outpacing legacy finance in innovation and price discovery, while the U.S. risks falling behind as other countries implement clear, favorable rules. Near term, Melker expects bullish news to eventually drive prices higher, likely in Q4.

## Transcript

Crypto is currently trading China's biggest chip IPO before Wall Street and legacy markets can and at roughly a 6X premium. That's just one of many stories that I have for you today on The Daily Wolf. Let's go.
>> Good morning, everybody. Welcome to The Daily Wolf on Yahoo Finance. I am your host Scott Melker, also known as The Wolf of All Streets. We're going to take the next 15 minutes together as a family to dive deeply into all of
the news driving markets right now and try to extract a bit of signal from the endless noise. Now, the last 2 days I had incredible interviews with Carlos from Securitize and Matt Hogan from Bitwise, so we didn't dive too deeply
into the news, which gives us a bit more fodder to dive into today. Now, while this isn't necessarily a story of crypto price, it's certainly a story of crypto rails. Number one right here. Crypto market offers pre-IPO bets on Chinese
chip maker CXMT. I still have to sort of giggle to myself that we get hyper liquid headlines on Bloomberg. But, here you go. For the next 12 days, nobody on Wall Street can buy a single share of the biggest chip
buy a single share of the biggest chip IPO of the year. Crypto traders are it at several times what the company says it's worth. I'll tell you that valuation in a moment. So, just to be clear, we saw this with SpaceX, but
long on a Chinese memory chip company that isn't public yet in shares you'll never actually own at 3:00 in the morning on Sunday with leverage. If that sentence doesn't scare you, then
person this was built for. So, yes, this is the news right here. CXMT, which is Changxin Memory Technologies, is China's largest DRAM maker and the world's fourth largest mem memory manufacturer.
So, they have a valued this the IPO price 714 at 8.66 yuan per share. They price 714 at 8.66 yuan per share. They raised 8.5 billion dollars at a 85.5 billion valuation. That is settled. So, the last I checked, haven't checked
in the past few minutes, but it was trading on hyper liquid at 535 billion valuation. That's a 526% roughly premium. So, several times the
IPO price. We saw this with SpaceX and others, but not nearly at this high SK Hynix that we've talked about in Korea, their version of that in China, and 12 days ahead of IPO, it's being traded at a 6X premium. So, to be clear,
this contract is synthetic. There's no shares, there's no ownership. It's a shares, there's no ownership. It's a pure bet on where this basically opens uh in 12 days. So, this is crypto doing price discovery that Wall Street
structurally can't. It's global, it's instant, and it's permissionless. And imagine what happens when the billions of people in China find out I mean, think about that, right? Hyper liquid obviously started as a
liquid obviously started as a decentralized uh exchange for crypto trading, right? It was basically the answer in decentralization to the Coinbases and OKXs and Krakens and Binances of the world. And while it
gained massive popularity for trading with crypto, it really broke out when they brought in silver and gold markets and oil contracts, and then of course, pre-IPO. So, it brought in not just crypto degenerates who now are trading
new things besides crypto on crypto rails. It brought in a whole new world. As I said, we're seeing Bloomberg headlines about it now. A whole new world of traders who can use this 24/7 365. And now we're really seeing the the
final boss, which is that it's gaining uh uh traction in all of these foreign markets that had nothing to do with crypto who are going to be interested in about how much FOMO there was around SK Hynix Hynix and Samsung in Korea that
retirees were effectively trading in their insurance and savings to go 2x what we're likely seeing here is starting to build in China ahead of this IPO 12 days in advance at a 6x premium. So,
Wall Street waits till the 27th. Crypto doesn't wait for permission, and you can you can hold that thought because uh a lot of governments right now are starting to give us a lot more permission than the United States. We're
have the next biggest story today, which you also won't think is a crypto story, but very much is. Stripe Advent make 53 billion takeover offer for PayPal sending stock soaring. Okay, of course the stock is soaring
because PayPal's stock has traded like a heaping dumpster fire. Uh and it's down a gazillion roughly dollars from its 2021 highs. So, what's most interesting
here, I think, is it's the company that quietly passed PayPal already, which is Stripe, is now trying to buy it. They just put 53 billion dollars on the table for the name that used to define online payments entirely. But like I said, that
used to trade at 360 billion dollars in 2021. This is a 53 billion-dollar offer, and it would take PayPal off public markets and take them entirely profit uh
markets and take them entirely profit uh private in a 50/50 split between Advent International and Stripe. So, listen, we can dive endlessly into what this means things that you literally don't care
about at all. But think about it from this perspective. So, PayPal was one of the first institutional entrants into the stablecoin race long before we actually even had the genius act. They launched PYUSD.
I'll never get over that name. Just use PUSD. So, they launched PYUSD, which has gained quite a bit of traction and is one of the more popular sort of mid-tier stable coins. But you saw that last year Stripe, which
is a payments giant now as I said has surpassed uh PayPal. They bought Bridge, which was a billion billion-dollar plus acquisition, a unicorn that allowed them to enter the stable coin race. They launched Tempo,
which is their own layer-two blockchain specifically tailor-made for stable coins. And then recently I covered the news here that they were leading a news here that they were leading a consortium of 140-plus companies to
build a new stable coin called OpenUSD, that new protocol. Now, some of those companies like Samsung said, "Why is my logo on this? I don't know who you are." But we can skip that nuance. 140 companies uh lent their logos at least
sort of coming from two sides. You have Stripe, which has gone all in on stable coins. They use USDC on the weekends for their own payments and they've built their own blockchain. They have contributed to OpenUSD and are leading
that and they would also be purchasing PYUSD and all of that infrastructure PYUSD and all of that infrastructure over at PayPal. So, to be clear, PayPal I'm not even sure they're taking the calls on this. So, it's very public this
nothing from PayPal that there's actually any interest in this happening, but uh that's not a story that we've we've seen that story before. I believe we saw it when Elon Musk took over X that it wasn't really on the table and
he got it anyways. Um but this will be an interesting story to track because these are two absolute payment giants. They've both made massive moves into the stable coin space, and now that could be entirely
consolidated as competition against the stable coins that we've come to know and love. Now, going back to that permission story, uh we have a situation here
where we got three countries making favorable legislation while we're stuck in neutral at best in the United States with the Clarity Act, which has uh roughly a few weeks left before it needs to be passed before it becomes entirely
entirely off the table. So, first we will start in Japan right here. Japan passes key bill recognizing crypto as financial product, lowering tax rates. So, Japan cut its crypto tax from 55% to 20 here.
Uh America's response was to have a press conference accusing itself of corruption and bribery, but we'll get that get to that in a minute. So, this is finally done. Japan passed this. We've reported on it before. Both houses
of uh their the Diet passed amendments to the Financial Instruments and Exchange Act reclassifying crypto as a financial product, which cuts taxes from 55 to 20%, uh lays the groundwork for spot ETFs,
which they still don't have, and new insider trading rules. So, Japan's very sensible legislation here. We'll treat Bitcoin properly. You will no longer get charged 55% for uh spending in Bitcoin. Now, the next one, and I keep reporting
on this, the United Kingdom, they got good at soccer again, and now they're I'm not going to say the two are correlated, but it seems like the UK is board. Uh UK adopts no gain, no loss tax
liquidity pools. So, we've had a UK update seemingly every single week now. They came up with uh more favorable stable coin legislation, as I told you in the past. Well, now they're coming up with sensible sensible legislation for,
you know, borrowing and lending in DeFi. I didn't have it on my bingo card that the UK would be leading in DeFi legislation, but here we are. So, they're going to basically say that you will have no capital gains event until
won't have to worry about transferring in and out of DeFi. Really popular, good idea. And the final one, South Korea to bring crypto under new state asset idea. Uh
seeing here, but very favorable legislation once again. And back in the United States, we can show you what's happening. Some US Senate Democrats come out against Clarity Act, calling it a
corrupt bill. So, we're expecting that this week we will get the merger from there's one thing that we already know for a fact, it will not contain any
ethics language. And if you have been watching my show, following me, listening to the things I have to say, ethics is the whole fight. And now you have three more Democrats who were already against it, but they're coming
happening without ethics, this is corruption. Uh if Trump's able to profit from it, then we're not going to have any part in it. And they even cited, as I said they would, the report from uh 2 weeks ago that said just how much money
the Trump family had made in the crypto industry. So, you now have less, well, in this case they're the same ones, but you can see the Democratic senators who have already said they would not vote for this
without an ethics provision, and there's going to be no ethics provision, and we only have a few weeks left. So, the rest of the world is getting in line, coming up with clear rules of the road for the crypto industry and locking it into
bills and into law, and in the United States we're still arguing over here's another stupid thing we're doing in the United States, New York. New York becomes first US state to impose AI data center ban. Yay,
>> [sighs] >> So, listen, this isn't the first time that we had a story like this. In 2022, they were the first state to attempt a moratorium, same thing, a pause on Bitcoin mining at Greenidge, I'll never
forget. There was an article, I've told this story before, e- even this morning But, I was swimming in Seneca Lake at my friend's lake house on the summer, and facility right there. We were looking at it and laughing as we froze our butts
off in the cold waters of a New York lake. And an article came out that said this entire lake, which by the way is like a mini ocean, uh by like 10 or 20
in it, I was swimming right next to the mining facility, and I realized how fake continuation, right? They uh they're doing now the same for AI data centers, concerns and all of it. It's a continuation of the exact same pol-
policy. I feel like the Finger Lakes are going to start to take this personally. Be quite honest. But, this is the first time that we're seeing a statewide ban. signed an executive order. It's not a law, it's executive order.
Pausing new state environmental permits for data centers drawing 50 MW or more, which is enough to send you in the future if you go 88 mph. For up to 1 framework. First state in the nation to do it. Why
would anyone who's doing anything innovative try to do it in the great state of New York? Concrete jungle where dreams are made There's nothing you can't do. Okay, next story, right here. I didn't get to talk
It's a Monday story, it's Wednesday, sue me. MicroStr- don't sue me. MicroStrategy sells shares to boost US dollar reserves. So, uh it's obviously you never or your
Bitcoin, although he recently has. You could sell the hell out of your shares. Right, so a lot of people were looking after the massive 3,000-ish Bitcoin sale I was hoping kind of that they would just start doing nothing. Cuz nothing
from the narrative. It seems like a compelling way to approach things. But they sold a bunch of MSTR to raise more cash to have a longer runway for paying the preferred dividends and all of their
Listen, you know, MicroStrategy was up, MicroStrategy was down. I think now it's back up as Bitcoin goes up. Not not a big surprise, but what I love about this story is that he is becoming less of the main
character. You don't see the insanity on social media anymore saying that need them to blow up for it to be a bottom, that they're going to have to sell all their Bitcoin. Right now, they've raised enough cash that nobody
solvency for the future and they still hold over 4% of all the Bitcoin that's ever existed on this here planet. So yeah, crypto gaining mainstream adoption
doesn't mean that the prices have necessarily trailed it. But if this is yet another cycle, then this is exactly the time when bullish things are happening, but price is not trailing it before we inevitably ramp up in Q4 and
happens and we'll talk about it more on tomorrow's Daily Worth Wolf. See you tomorrow's Daily Worth Wolf. See you tomorrow. Peace.