Kathy Kristof

Former @BlackRock
Now exploring what’s next for capital markets.

[Kathy Kristof @KathyKristof]

Pre-IPO🤔

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[Kathy Kristof @KathyKristof]

The interesting part isn't the token.

What caught my attention about the new tokenized stock launchpad is the relationship between the community token and the equity underneath it.

Most token launches end at the token. The market trades it, liquidity comes and goes, and the underlying value is mostly narrative.

This model takes a different approach. A portion of trading activity is continuously directed toward the paired stock, so the ecosystem is gradually building an equity treasury as the market grows.

That changes the incentive structure.

The community isn't only speculating on a token. Trading activity can also increase the amount of the underlying equity held by the ecosystem.

What I find even more interesting is the governance layer.

The stock treasury isn't simply controlled by whoever owns the most tokens. Anyone can put forward a governance mandate, and holders can delegate their voting power to candidates whose ideas they actually agree with.

The AI agent attached to each candidate is an interesting experiment here. Instead of AI being another trading bot, it becomes a representation of a specific governance mandate.

That creates something closer to a community-run investment vehicle, at least conceptually.

There are obviously a lot of questions around liquidity, custody, pricing and regulation before I would call this institutional-grade.

But the direction is interesting.

Tokenization isn't really about putting a stock onchain.

It's about figuring out what happens to the stock, the liquidity and the capital around it once it is there.

That's the part I'm watching.

[Kathy Kristof @KathyKristof]

The market doesn’t become more liquid just because an asset is tokenized.

The underlying still matters.

A token representing a $10B company and a token representing a $50M company may look identical onchain, but the liquidity behind them is completely different.

That difference matters a lot when the market moves fast.

[Kathy Kristof @KathyKristof]

This is why I care more about the asset underneath the token than the meme itself.

After years in traditional asset management, the first thing I look at is the underlying equity and its liquidity.

If that moves differently from the real market, the dollar chart can tell a very different story.

[Sweep @0xSweep]

DO NOT BUY STOCK PAIRED MEMECOINS BEFORE YOU READ THIS

One market maker is making millions on these launches without ever bidding the coin itself. Roughly 70% of the volume you are looking at is net profit to one entity, and it is more profitable than any bundle because it never needs the coin to go up

At first glance it looks like a normal onchain coin where traders are PVPing each other and price only moves on net buys and sells

The easiest way to see something is off is to pull up the top PNLs after one of these does hundreds of millions in volume

For the size of the move, almost nobody made anywhere near the money you would expect. That is because a large part of it was never transferred from one meme trader to another. It was extracted through the stock token the meme is paired against

The stock token is not a share. It is an IOU printed by a company that holds the real share somewhere else. You cannot redeem it and you cannot create one

Only approved market makers can. They buy the real stock during market hours, have matching stock tokens created, then sell those tokens onchain. Everyone else can only trade the supply already circulating

Now the memecoin launches against that stock token. You are not buying the meme with dollars, you are buying it with stock tokens, and in an AMM every stock token used to buy the meme stays inside the liquidity pool

As more people buy the memecoin, more of the stock token supply gets pulled out of the open market and locked inside that one pool, which makes the remaining stock token market thinner and easier to move

Then the US stock market closes. The real share stops trading, the market maker can no longer hedge or create fresh supply, but the onchain market keeps running

If enough stock tokens have already been sucked into the meme pool, even a small amount of demand can now push the stock token far above the real share price

This is where the chart is completely lying to you

Your memecoin's dollar price is its price against the stock token multiplied by the dollar price of that stock token

If the real share is worth $10 but the stock token gets squeezed to $20 because there is no supply, your memecoin's dollar market cap effectively doubles even if absolutely nothing changed in the memecoin itself

Same thing as bitcoin printing $1,000,000 if USDT crashed to ten cents. The asset did not change. What you are pricing it in did

Retail sees the dollar chart exploding and assumes more money is entering the meme. In reality a large part of the move is just the stock token underneath trading at a fake premium

Then the stock market opens

The market maker can buy the real shares again, create fresh stock tokens near the real share price and sell those tokens into the massive onchain premium

More supply comes in, the stock token falls back toward the real stock price, and all of this can happen within 5 minutes

Your memecoin can remain completely flat against the stock token while the dollar chart gets cut in half

That is where a lot of the missing PNL went. A big part of the run was never actual dollars entering the memecoin in the first place. Retail paid the stock token premium on the way up and then ate the collapse of that same premium on the way down

The market maker does not need to guess whether your meme goes up or down. It buys the real share near fair value, creates the stock token, sells that token above fair value and keeps the position hedged

Its trade is the gap between the real stock and what retail is willing to pay for the onchain wrapper

Now people think using a tiny penny stock fixes this, because the market maker cannot easily buy enough shares to create new stock tokens, so the premium supposedly cannot close and the memecoin can keep running

That actually makes it all worse

The market maker is not forced to create supply. If the underlying stock becomes too illiquid to hedge properly, it can simply stop minting

There is no permanent premium. You get an illiquid stock token with no depth, which means your memecoin is now priced against one of the easiest markets in the world to move

Cheap low float stocks move violently on tiny amounts of capital. The fair value your memecoin is tied to can be manipulated in a completely separate market that you cannot see and are not part of

The company behind that stock can also issue new shares. If the onchain narrative pushes enough demand into the real stock and sends it higher, the company can sell fresh shares directly into those bids

The stock backing your token gets diluted in the same trade

Then there are halts. Small stocks halt constantly, sometimes for hours or days. When the underlying stops trading there is no clean live reference price, hedging can stop and creation or redemption can stop, while the onchain pool continues trading 24/7

You can now have millions of dollars trading against a token representing a stock that is not even open

When that stock finally reopens, it can reopen massively lower

Reverse splits and delistings sit on top of all of it. You do not hold the stock. You are relying on the wrapper and its issuer to correctly handle whatever the company does

And yes, these tiny stocks can actually go to zero. That is the asset you chose as collateral for your memecoin

The squeeze thesis does not work either

Traditional memestock squeezes work because shorts can become forced buyers of a limited float

Here the stock token supply can expand whenever an approved market maker can buy the underlying shares and create more tokens

There is no guaranteed forced buyer, just a market maker with a hedge and the ability to add supply whenever the underlying market allows it

The only time that supply really jams is when the stock is too illiquid to hedge, which is exactly when your own exit is at its worst

If you are going to hold one of these at all, the stock underneath should be huge, liquid and boring. Big enough that your entire community cannot move it, liquid enough that the market maker can hedge real size, and with enough stock token supply circulating that one memecoin pool cannot drain the entire market

You probably will not get the insane weekend move against a mega cap stock

That is the point. The insane weekend move is the distortion you end up paying for

Before you buy one of these, check whether the underlying stock actually trades real volume, whether the stock token is already trading above the real share price, whether the US market is open, how much stock token supply exists outside the meme pool, and whether the company can issue new shares into the demand

Then understand your exit before you enter. You first sell the meme back into the stock token, then you still need that stock token to hold its value while you convert it into something real. Both parts of that trade can move against you at the same time

Volume is not profit

If the stock underneath is small enough that your community can move it that's how you get trapped

STOP GIVING THE MARKET MAKERS FREE MONEY

YOU ARE GIVING THEM THEIR DREAM SETUP

[Kathy Kristof @KathyKristof]

Interesting setup, but I’m paying more attention to liquidity than the Bitcoin range itself.

Having spent years around traditional markets, I think the bigger story is what happens when the liquidity behind ETFs and Nasdaq equities starts moving onchain.

That transition is going to be much more interesting than another short squeeze.

[glassnode @glassnode]

Bitcoin has stalled below long-term overhead supply.

The trading range is well-defined by two cost basis clusters.

Liquidation clusters also provide significant confluence.

Read our latest Week On Chain Article https://t.co/yFjUJkaIRH

[Kathy Kristof @KathyKristof]

The more I look at this space, the less interested I am in creating another token.

I’m more interested in what sits underneath it — the systems that make an onchain asset useful in the first place.

Still early, but I think there’s something worth building here.

[Kathy Kristof @KathyKristof]

TL;DR

Tokenization is only the first step.

The real work starts after the asset comes onchain — building a market where it can actually be priced, traded and managed.

That’s what I’m working on.

[Kathy Kristof @KathyKristof]

https://t.co/Mb2yAlED3O

[Kathy Kristof @KathyKristof]

https://t.co/Mb2yAlED3O

[Kathy Kristof @KathyKristof]

I’ve been thinking a lot about what happens after traditional assets move onchain.

Putting an asset on a blockchain is relatively straightforward. The difficult part is making the market around it actually work.

That’s the problem I’ve been working on.

[Kathy Kristof @KathyKristof]

The more time I spent in traditional finance, the more obvious it became.

Moving an asset onchain is easy.

Getting liquidity, pricing and risk management right is the hard part.

That’s where I’m focused now.

[Kathy Kristof @KathyKristof]

Spent most of my career watching how capital moves through the financial system.

The infrastructure is powerful, but much of it was built for a different era.

I think the next chapter will be written onchain.

Been working on something around that idea.

[Robinhood @RobinhoodApp]

Something new is growing.

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[Kathy Kristof @KathyKristof]

@MillerFinance @Sassafrass_84 Stop and think about whether your intolerance is turning you into a person you can't be proud of. Guard your soul. It's the only one you've got.

[Kathy Kristof @KathyKristof]

@DagTagLife @Sassafrass_84 Hate is not the answer. Be like Charlie.

[Kathy Kristof @KathyKristof]

@Sassafrass_84 He was a good man, who wanted to talk to people who disagreed with him...and talk respectfully. I just wish there were more people like him.

[Sassafrass84 @Sassafrass_84]

This has to be one of the bravest videos I have watched on the internet today.

When Charlie Kirk died it hit so many us of really hard. Not only was it a profound loss but the reality was that the left really wants conservatives dead because of political views. They are ok with m*rdering people if you dont conform to their political ideology.

These are dangerous times.

In a way it also (like this man here in the video) "woke" people up. They realized the political propaganda, media manipulation, and the dehumanization occuring by the left and media.

He learned something far more valuable in the death of Charlie Kirk.

This took a lot of guts to post this video online. I commend him.

[Kathy Kristof @KathyKristof]

I'm in California. My daughter moved to Washington, D.C. Both run by Democrats. She continues to get California mail-in ballots, even though she hasn't lived here since she moved to DC for college in 2008. Maybe she voted in California for a few years, when she was still in school. But she graduated in 2012. That's 14 years ago.