Tulip King - Zcash to a Trillion, Onchain Options & AI-Secured Bitcoin
Summary
Tulip King argues the market’s edge has shifted from frantic meme-coin “trench warfare” toward concentrated, thesis-driven positions that can compound. Making $1 million on one researched trade is easier than making $10,000 hundreds of times, while burned DeFi veterans remain overly cautious. His demand: “Start believing in something” that could still exist in a year.
Zcash is his highest-conviction monetary bet because privacy demand, price reflexivity, and wealthy buyers could reinforce one another. With ZEC around $1,430, he sees a plausible path from $1,000 to $10,000 over a long horizon and ultimately calls it “a trillion-dollar coin,” while warning that leverage can destroy holders before the thesis plays out.
The thesis depends on Zcash being private money, not merely privacy middleware. A private Ethereum could strengthen Ethereum and protocols such as Railgun, but Tulip King says ETH itself is not money because users increasingly transact in stablecoins, tokenized Bitcoin, and tokenized gold. His stark rotation scenario has Zcash at $1 trillion while ETH falls to $600–$1,000, SOL to $25, and BNB to $300–$400.
Zcash may attract capital “from above” because the richer someone becomes, the more wealth they want hidden. A $1 billion holder can use a $20 billion privacy pool in a way that $100 cannot use a $10 pool; as the shielded pool grows, privacy improves together with its ability to absorb larger flows. “There is an exponential return on privacy.”
Derive is Tulip King’s overlooked options bet because perpetuals cannot replicate options’ convex payouts, hedges, or volatility structures. After rejecting a Synthetix offer and issuing roughly 50% more supply to continue building, the team reportedly grew open interest four-to-eightfold, increased fees, began buybacks, and prepared V3. Thread Guy notes a market cap around $228 million and asks whether the leading onchain options venue is worth at least $1 billion, while explicitly declining a formal target.
Hyperliquid is the central challenge to that trade, but Tulip King thinks its small team is rationally focused on its dominant perpetual-futures engine. He owns more Hyperliquid than Drift and concedes HYPE might reach $100 or $200; he would reassess Derive if Hyperliquid or Lighter launched an options product that gained traction.
Pearl, or PRL, is the highly speculative “AI-secured Bitcoin” call: replace SHA-256 with matrix multiplication and subsidize verifiable AI computation through block rewards. Thread Guy and Tulip King discuss roughly 5% verification overhead, Together AI integration, and an estimate that capturing 1% of AI compute could produce 20 times Bitcoin’s hashrate. At about $170 million with high mining inflation and difficult access, Tulip King’s advice is blunt: if the research or purchase process is beyond you, “don’t buy this damn thing.”
Deep dive
1. Conviction is returning after years of low-cap trench warfare
Thread Guy’s market puzzle: veteran traders who once avoided memes finally capitulated to FOMO, yet many meme-native traders now express deeper conviction in larger assets such as ZEC. The supposed sophisticates are “peddling memes now without any conviction,” while former trench traders increasingly recognize the value of patience.
Tulip King’s explanation is payoff asymmetry: “It’s a lot easier to make a million dollars on one trade than 10 grand on hundreds of trades.” Meme-coin trench warfare teaches traders to distinguish lottery tickets from genuine opportunities; the next progression is finding something capable of moving from $10 million to $1 billion and holding it.
Older DeFi traders have the opposite problem. Governance tokens burned them so badly that they became cautious, intellectually stale, and reluctant to rebuild conviction—even as their information-processing skills could make them unusually effective once they identify a sound coin.
2. Zcash turns price, privacy, and belief into a reflexive monetary cycle
Tulip King begins from the premise that money is a social phenomenon—a meme whether it is shells, fiat, gold, or Bitcoin. Zcash addresses perceived Bitcoin weaknesses around privacy and quantum threats, but its more powerful feature is reflexivity: “The price is the product,” because appreciating money becomes easier and more desirable to hold.
Once ZEC crossed $1,000, he argues, $10,000 became conceivable over perhaps ten years. Adoption still has to occur and the price will eventually correct, but crypto can “put everything into the price as quickly as possible” if private money remains valuable over a long horizon.
The positioning matters as much as the thesis. He recommends building a large spot portfolio, accepting multi-cycle volatility, and using leverage only around the edges: leverage can liquidate believers, while spot lets them keep buying through the inevitable drawdowns.
His strongest evidence is experiential rather than analytical. Shielding even 0.1 ZEC and seeing a hidden balance recreated the “magic” he felt sending his first Bitcoin to a Ledger and later using DeFi: “I can send this anywhere and no one will know.” His prescription is simple—touch Bitcoin, DeFi, or Zcash directly, and conviction stops depending on tweets.
3. Private money and privacy protocols accrue value differently
Thread Guy asks whether private ETH from Vitalik would undermine Zcash. Tulip King’s answer is “I don’t think it matters,” because Railgun, Tornado Cash, or private-Ethereum features are privacy infrastructure, while Zcash is attempting to become money itself.
He allows that privacy protocols could be undervalued: wallet integrations, stablecoin privacy, fees, and token buyback-and-burn programs might create valuable businesses. Hyperliquid can be worth more than some cryptocurrencies, and Apple can be worth more than some fiat currencies, without either being money; a trillion-dollar valuation does not require monetary status.
His objection is specifically to the monetary premium assigned to ETH, SOL, and BNB. Ethereum hosts trading, borrowing, and lending against stablecoins, tokenized Bitcoin, and tokenized gold, undermining the old assumption that ETH must become “the money of that economy.” His endpoint is deliberately extreme: Zcash at $1 trillion, ETH at $600–$1,000, SOL at $25, and BNB at $300–$400.
The mechanism is the Cisco-versus-Facebook distinction. Hyperliquid captures more when customers trade more, and social networks monetize increasingly valuable connections; generic blockchains instead sell commodity blockspace. Whether one sends $1 or $1 billion in stablecoins, the chain collects roughly the same tiny fee—“This is a block-space problem.”
4. Wealth creates a top-down demand loop that Bitcoin did not have
Bitcoin was a bottom-up revolution: hobbyists transferred it for fun, marginal users needed censorship resistance, and legitimacy eventually became impossible for institutions to ignore. Zcash retains grassroots believers, but Tulip King says its demand curve is unusually wealth-weighted.
Someone with $1,000 may not care who sees it; someone with $1 million might hide $100,000; a billionaire may want half their fortune private. His framing: “The richer you are, the greater percentage of your money you want to make private,” especially amid taxes, capital controls, surveillance cameras, or threats to retirement assets.
Pool size compounds that demand. A user cannot put $100 into a $10 mixing pool, but can plausibly put $1 billion into a $20 billion pool; Tulip King claims Zcash’s shielded pool accumulates privacy as coins remain in it, unlike Monero in his framing. More capital therefore creates better privacy, greater capacity, and still more capital “from above.”
5. Derive is a convexity trade hiding behind the perpetuals boom
Tulip King initially dismissed crypto options because “everyone is only interested in perpetual futures.” A viral trade from the Kool-Aid Man account changed his attention, not his thesis: traders have become celebrities, their wins attract users, and in financial venues “liquidity begets liquidity.”
Perpetuals remain simpler for retail, short-duration trades, and rapidly listing new assets, but they deliver linear leveraged returns. Options offer convexity, premium selling, hedging, and custom payouts across assets, strikes, and prices; they are a separate instrument, so “there’s no world where perpetual contracts will swallow up the entire options market.”
Derive’s survival provides the project-specific case. During the bear market it rejected a Synthetix buyout, issued roughly 50% additional supply to continue building, and—by Tulip King’s account—expanded open interest four-to-eightfold, increased fees, and began repurchasing that issuance. V3 is intended to bring a ZK rollup, a rebuilt integration API, more markets, and cross-margining between options and perpetuals.
At an indicated market capitalization near $228 million, Thread Guy frames the question: is the best options protocol worth at least $1 billion? Rather than buying the third- or fourth-best perpetual DEX, investors seeking onchain TradFi exposure might prefer the leading venue in a category crypto has ignored.
6. Hyperliquid risk is real, while Pearl tests an AI-native proof-of-work thesis
Thread Guy’s pushback is direct: what if Hyperliquid destroys the options competition? Tulip King concedes it might and notes that he owns more Hyperliquid than Drift, but its advantage—a very small, focused team—is also why it keeps prioritizing order-book depth, margining, liquidations, and advanced perpetual products instead of options.
He would change his mind if Hyperliquid or Lighter launched an options product and gained momentum. Until then, he is “going to bet on the winner” in options, while treating Hyperliquid’s neglected prediction-market effort as consistent with management’s focus on its core engine.
Pearl, ticker PRL, extends the Zcash lesson that Bitcoin may not be the only cryptocurrency capable of monetary scale. Its pitch is conceptually simple: “This is Bitcoin, but instead of SHA, it’s matrix multiplication”—an AI-work network without programmability, subjective task scoring, or a separate validation network.
The technical hurdle is verification. SHA-256 can require enormous work yet be checked almost instantly; useful AI inference normally must be rerun, creating duplication and subjective quality judgments. Thread Guy says he could be wrong as they get into the cryptography, but describes Pearl as using a ZK-like proof to verify matrix multiplication with roughly 5% overhead, which block rewards could more than offset.
He cites Together AI already offering Pearl-subsidized inference, an active effort to support floating-point computation and open-source models, and an estimate that 1% of AI compute would equal 20 times Bitcoin’s hashrate. The memetic catalyst is miners shifting capacity toward AI: if future workloads are matrix multiplication, why should the next proof-of-work money remain tied to useless hashes?
Pearl remains mineable, highly inflationary, hard to acquire, and worth roughly $170 million at the time discussed. That makes it research-only territory, not a retail recommendation. The broader closing call is the real portfolio message: develop theses around assets likely to exist in a year, because “a real bull market…is a market for holders,” and most gains now come from compounding rather than constant rotation.