On this week’s episode of the Galaxy Brains podcast, I spoke with Galaxy Trading’s Jason Urban about bitcoin and crypto treasury companies, international crypto markets, lending, and much more. I also chatted with Jason’s Galaxy Trading colleague, Michael Harvey, about markets, rates, and the economy.
On the research desk, Lucas Tcheyan and Will Owens published a deep dive on HyperEVM, the sister chain to Hyperliquid’s better-known perpetual futures trading protocol HyperCore.
In the newsletter this week, Lucas explains the significance of Phantom Wallet’s integration of Hyperliquid’s perps product; Will and Arjun Yenamandra preview pump.fun’s imminent token sale; and I break down SEC Commissioner Hester Peirce’s statement on tokenized securities.
Have a great weekend,
Alex
Market Update
Data via Messari as of 9:10 AM 7/11/25
The total implied network value (market cap) of the digital assets market is up 8% from a week ago at $3.76t. Bitcoin’s network value is 10.02% of gold’s market cap. Over the last seven days, BTC is up 9.1%, ETH is up 18.6%, and SOL is up 12%. Bitcoin dominance is 64.55%, down 1.09 percentage points from last week.
Stories of the week
001
⛽ Solana’s Most Watched Token Launch: $PUMP ICO
Following weeks of speculation, pump.fun, the Solana-based memecoin launchpad, officially announced plans to launch its own token. $PUMP will be distributed through a public initial coin offering (ICO) starting Saturday, July 12. This will likely be the most closely watched token event of the year.
Created in early 2024 as a simple tool to create and trade memecoins, pump.fun has grown into one of the largest apps in all of crypto by practically any measure. The platform has become the flagship Solana application with a mobile app, massive user base (>100K active users daily), and over $68 billion in cumulative trading volume.
The chart below breaks down $PUMP’s tokenomics (total supply: 1 trillion). Of the 33% allocated to the ICO, 18% is designated for a private sale to institutional investors, with the remaining 15% allocated to the public sale.
According to pump.fun, private and public investors are receiving tokens on identical terms. The public sale will run from July 12, 10:00 AM EST to July 15, 10:00 AM EST, or until all ICO-allocated tokens have been purchased. Eligible platforms for participating in the ICO include ByBit, Kraken, KuCoin, Bitget, MEXC, and others. Notably, U.S. and U.K. investors are excluded from the offering. Tokens will initially be non-transferable, until 48-72 hours after the sale ends. On X (formerly Twitter), the official account teased an “airdrop coming soon.”
Market interest in $PUMP is already surging ahead of the launch. Notably, Hyperliquid has listed $PUMP perpetual futures with up to 3x leverage before the token is even transferable. A pre-market derivative listing is rare and shows the intense anticipation around the launch. As of 3:00 PM EST on July 10, open interest in $PUMP Hyperliquid perps had reached $65 million, signaling strong speculative demand and early positioning/hedging by traders ahead of the ICO.
Pump.fun has been critical for Solana’s growth, driving network activity more than any other app. The platform has turned Solana into the go-to destination for launching and speculating on memecoins, helping it to surpass all other chains in daily active addresses.
Our Take
The launch of $PUMP is a watershed moment. It formalizes pump.fun’s role as the native monetization engine for Solana’s attention economy.
Since its inception in early 2024, pump.fun has accumulated over $800 million in fees and dominated the memecoin sector. However, competition is heating up: bonk.fun, a rival launchpad that launched just two months ago, recently flipped pump.fun in daily tokens launched and 24-hour volume, a first.
A key reason for bonk.fun’s rise is its tokenholder-friendly fee structure. Half the fees go to buy and burn $BONK, 8% goes toward buying BONK for reserves, and the rest is retained as revenue for the platform. This structure has created organic demand for $BONK and strongly aligned token value with platform growth. With bonk.fun now generating over $1 million/day in fees, the protocol contributes at least $500,000/day in BONK buy-and-burn pressure.
In the last two months, the top coins launched on bonk.fun have achieved market caps as high as $20 million ($KORI) and even $300 million (the candidly named $USELESS token), dwarfing the $15 million to $30 million valuations fetched by pump.fun’s largest creations during that timeframe ($GOR, $VERSE, $CHILLHOUSE, etc.). It’s clear that, as of late, the onchain ecosystem has been more receptive to bonk.fun launches over pump.fun launches.
In contrast, pump.fun constantly faces criticism from users for what they call an extractive and opaque value distribution. The platform routinely sells massive amounts of SOL, reinforcing the perception that it acts primarily to extract liquidity from the ecosystem it helped grow. Pump.fun has a chance to change this narrative if it can reward users well through an airdrop, drive value to its token, and help creators in its ecosystem prosper.
Speculators hope that the pump.fun airdrop will serve as a liquidity injection for the Solana ecosystem. But neither of the two comparable recent airdrops on the chain (Jupiter’s and Pengu’s) significantly increased volume for pump.fun tokens or Solana DEXs. To be fair, pump.fun has a much different user base.
There are no official numbers regarding the pump.fun airdrop yet, but the team has allocated 24% of $PUMP supply to “community and ecosystem initiatives.” At a $4 billion valuation, this is $960 million, close in size to Jupiter’s ~$1 billion and Pengu’s ~$1.5 billion airdrop. The question remains if this will be significant enough for pump.fun to reclaim its throne as the top Solana launchpad.
There is also a lack of clarity regarding what rights token holders have over pump.fun’s revenue. An anonymously sourced news story said 25% of revenue will flow to the token, but it is unclear whether this would include pre-TGE revenue or only future revenue, or how token buybacks would be structured. This is a concern because pump.fun is one of crypto’s most lucrative apps, with over $700 million in cumulative revenue, and consistent $35m+ in monthly revenue since November 2024.
Pump.fun is also making a major push to reward the creator economy and streaming universe. It’s allocated 3% of token supply to support live streamers on the platform and has started to take major strides toward onboarding creators. SocialFi in crypto has not caught on so far, as evidenced by the shuttering of friend.tech and similar platforms. This is largely because it remains challenging to design social tokens with sustainable value for creators and their audiences.
Ideally, pump.fun can capitalize on these issues and build interesting mechanisms for creators to monetize their attention and grow the streaming audience on the platform. –Will Owens and Arjun Yenamandra
002
🍬 A Peirce-ing Critique of Tokenized Security ‘Wrappers’
SEC Commissioner Hester Peirce released a pointed statement on tokenized securities. Peirce called tokenization “enchanting, not magical,” and reiterated that tokenized securities must follow securities laws, just like analog securities.
Without naming names, Peirce pushed back on certain tokenization structures, highlighting those in which the tokens are “a receipt for a security” or where exposure is achieved by putting an equity security inside a separate, tokenized instrument. She reiterated that those structures would likely themselves be securities or “securities-based swaps” and thus subject to securities laws. If we read between the lines, Peirce appeared to be referencing the recent high-profile launches of tokenized securities by Backed, first through its own xStocks program and more recently in partnership with Robinhood. Both operate effectively in offshore SPV-like structures.
SPYx, Backed’s tokenized SPY index fund, launched on July 1 and has $7 million in circulating supply. Since launch, SPYx has traded, on average, at a dollar-weighted spread of 50 basis points above or below the best bid or offer, well above 1.5 basis points for the real SPY. At times the synthetic product’s spread has ballooned to ~400 basis points during overnight trading.
Our Take
We wrote at length about Robinhood’s tokenization efforts in last week’s edition of this newsletter and pointed out that the SEC’s views on this method of tokenization were unclear. Those views look a bit less unclear after Commissioner Peirce’s statement this week, although we should note that hers is her own statement and does not necessarily reflect the views of the entire Commission.
We believe the optimal structure for tokenization of equity securities is for the tokenized versions to be actual shares of underlying securities, not wrappers. Peirce makes the point that owning an interest in a vehicle that owns securities is itself a security, but the downside is that the token holder has no material equity ownership or voting rights in the underlying equity security. While tokenholders of Backed’s version of Tesla shares may receive economic exposure to the stock price, they have no voting rights or direct claims on the automaker. Furthermore, if the SEC allows the direct tokenization of equity securities, there won’t be a need for these types of “wrapped” structures or the intermediaries that operate them, which themselves add a layer of cost to the investor.
The best structure for investors is to allow the direct issuance of on-chain securities by issuers themselves; that’s the structure that democratizes finance by bypassing certain rent-seeking intermediaries, reducing transaction and ownership costs, and increasing transparency through the public blockchain. The wrapped structures obviate the relationship between issuer and shareholder to the detriment of both.
The emergence of such backdoor tokenization structures is understandable given the SEC’s historic inaction in allowing issuers, exchanges, and investors to go through the proverbial front door. Proper regulation on this front should protect investors and support innovation by creating a legal, regulated pathway for legitimate market activity, allow compliant actors through that pathway, and then take enforcement action against those who bypass the front door and instead choose to operate outside the regulatory regime.
There are huge questions about how to properly design the equity tokenization pathway, and how to adapt the rules for exchanges, investment advisors, issuers, and broker-dealers, and the SEC deserves a lot of credit for finally working on these questions in earnest. Without that pathway, we expect suboptimal structures to continue to emerge offshore and in jurisdictions whose securities laws are not as developed or protective as those in the U.S.
There is clearly demand for tokenized securities, but if the longtime goal of innovators to bring blockchains (with all their transparency, programmability, and efficiency) into the world of traditional finance is to be realized, regulators need to confront the tough questions head-on and remove the incentive to skirt the rules. – Alex Thorn
003
👻 Perps in Your Pocket: Phantom Wallet Integrates Hyperliquid
On Tuesday, Phantom launched a direct integration with the Hyperliquid perpetuals product on its mobile wallet. Phantom users can now trade on Hyperliquid markets with up to 40x leverage.
To execute a trade, users deposit SOL into Phantom. The token is then bridged to Hyperliquid and swapped for USDC on Hyperliquid’s spot market. After the position is closed, funds remain in the user’s perpetuals account, but can be withdrawn to the Solana wallet, where it is converted to SOL. Bridging is handled via Unit, an asset tokenization layer on Hyperliquid that enables cross-chain deposits and withdrawals of major cryptocurrencies such as BTC, ETH, and SOL. Unit operates a decentralized guardian network that uses a lock-and-mint system to issue native spot assets without relying on centralized custodians.
The integration does not offer the full Hyperliquid product suite. Users can place stop-loss orders and take profits, but once a position is opened, they cannot increase the size, add margin, or adjust leverage. Additional features will be integrated. Phantom and Hyperliquid are rolling out the integration in phases, with more users gaining access over the coming weeks.
Phantom started as a Solana-only wallet but has steadily expanded its cross-chain offerings over the past two years to include integrations with Ethereum, Bitcoin, Base, Move, and Sui. The team has also announced they will integrate Monad when the chain launches. Other recent enhancements include in-app bridging and a news feed.
In January, Phantom raised $150 million at a $3 billion valuation in a Series C round from major VCs including Sequoia Capital and Paradigm. Phantom reports 15 million monthly active users, $25 billion in self-custodied assets, and over $20 billion in 2024 swap volumes. It previously ranked as the No. 1 downloaded “utilities” app in in the U.S. IOS app store during the November 2024 meme frenzy and No. 1 “finance” app in the Google app store this past spring.
Our Take
Phantom’s Hyperliquid integration marks a turning point in the wallet’s evolution from first mover on Solana to full-blown crypto super-app. By embedding direct access to Hyperliquid perpetuals – one of the most sought-after products in the market – Phantom is no longer just a gateway to blockchains, but a distributor of the most-demanded trading venues.
In an interview following the release, Phantom co-founder Brandom Millman said, “Phantom’s vision is all about taking the best of crypto and delivering it to users in a secure, safe, and easy to use way….to solve the usability problem of crypto as the ecosystem grows and things get more complicated.” The release is more consequential than prior “add another chain” rollouts: it stands to deepen user engagement, improve retention, and position Phantom as the place where users can find best-in-class liquidity and execution for any crypto product they want to use.
The integration is a win-win for Phantom and Hyperliquid. Hyperliquid gains access to Phantom’s 15 million monthly average users (a number rivaling Robinhood’s) through a major mobile-native distribution channel. The launch also underscores the effectiveness of Hyperliquid’s growth strategy: provide the most liquid platform and infrastructure/tooling that incentivize users to build on top of it. Specifically, Phantom leverages Hyperliquid’s Builder Codes feature that allows the wallet maker to receive a portion of the fees Hyperliquid earns on trades made by Phantom users. As Hyperliquid co-founder Jeff Yan tweeted following the announcement, “by building on Hyperliquid, the Phantom team can focus on their world-class user experience, trusting that the liquidity infrastructure of Hyperliquid will give their users world-class execution.”
Solana-native perp venues are set to take the biggest hit. Their volumes and open interest were already bleeding as Hyperliquid gained popularity, and Phantom’s plug-and-play access makes the migration even easier. Just two days after the integration announcement, Drift stopped charging fees on BTC and ETH trades, likely in an effort to limit attrition.
The impact on Solana’s memecoin ecosystem, the main driver of Solana onchain activity, will be smaller. If anything, the split between venues will become more pronounced. Solana will remain the go-to chain for memes, while Hyperliquid consolidates its role as the primary perpetuals venue. Given the nascent state of Hyperliquid’s HyperEVM chain, that dynamic is unlikely to shift in the near future (see our report published earlier this week on HyperEVM).
In the bigger picture, the launch is further validation of the chain-abstraction thesis. Soon, most users won’t know, or need to know, which underlying chain is facilitating their activity. Whether their perps or meme trades settle on Solana, Hyperliquid, or elsewhere, they’ll simply open Phantom and trade what they want with access to the most liquid venues. - Lucas Tcheyan
HyperEVM, Hyperliquid’s EVM-compatible, general-purpose layer-1 blockchain, is beginning to show early signs of traction.
Why Futarchy Matters: A Clearer North Star to Guide Fledgling Crypto Projects
In an industry that moves as fast as crypto, how do you stay nimble and informed enough to make winning decisions and pivot as quickly as possible?
Why Are Bitcoin Treasury Companies Trading at Such High Premiums to NAV?
The optionality that has made these equities so attractive in a bull market could quickly become a liability in a bearish one.
Can Binance Smart Chain Sustain Its Roaring Comeback?
If Binance took additional steps to filter out low-effort or spammy trading, while continuing to incentivize deeper user interaction with novel projects, it could use Alpha to identify quality tokens worthy of a full exchange listing.
Alex Thorn talks to Jason Urban of Galaxy Trading about bitcoin and crypto treasury companies, international crypto markets, lending, and much more. Alex also talks to Michael Harvey (also of Galaxy Trading) about markets, rates, and the economy.
The amount of ETH staked has reached a new all-time high of 35.73 million ETH. This is 971,400 ETH above the high reached in November 2024, and 2.12 million ETH higher than the low of 33.6 million ETH reached in February 2025.
The rise of Ethereum treasury companies is presumably a driving factor for the increase in ETH staked. Sharplink, one of the largest ETH treasury companies, and Bit Digital have acquired 205,634 ETH and 100,603 ETH, respectively, over the last month. Bit Digital holds an additional 48,868 ETH in its treasury that can be staked. Moreover, while exchange traded products (ETPs) have not yet been officially cleared to stake, optimism about regulatory change may be providing psychological tailwinds to Ethereum’s staked supply.
The increase in ETH staked has been met with growing entry queue wait times. Ethereum throttles how quickly ETH can be staked and unstaked as a protection mechanism for the network. On the staking side, it forces a would-be malicious validator to wait some period of time for their stake to become active; on the unstake side, it limits how quickly the economic security of the network can decrease as a result of withdrawals.
The recent demand to stake ETH has pushed the wait time for stake to become active (secure the network and earn rewards) to nearly eight days. This is the highest it has been since May 2024. As of July 9, the entry queue waiting time sits around seven days, meaning individuals looking to stake must wait that long for their stake to become active.
Join GK8 by Galaxy for the next episode of their exclusive interview series, Joint Custody, hosted by Benjamin Duve, GK8’s Global Head of Partnerships.
The episode will feature Sabih Behzad, Head of Digital Assets and Currencies Transformation at Deutsche Bank.
In this 30-minute one-on-one, Sabih will talk about his journey leading blockchain adoption at Deutsche Bank and offer practical insights for institutions navigating digital transformation.
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