Author: Prathik Desai, Token Dispatch

Translator: Saoirse, Foresight News

"When the capital development of a country devolves into a by-product of casino trading activities, the enterprise of capital construction is likely to lead to failure." — John Maynard Keynes, 1936

The crypto industry has been heavily criticized, with many believing that it is completely driven by speculation, calling it a casino without fundamental support. However, many fail to realize that speculation is often a precursor to market evolution. A group of speculators, despised by the mainstream, gather together to pool liquidity, and the mature, compliant businesses that follow are built on this liquidity.

In this article, I will analyze this evolutionary path, combining recent phenomena in the crypto market: a public chain launched a meme coin issuance platform aimed at serving stock trading; a perpetual contract trading platform transformed to build commodity trading infrastructure; and a brokerage that relies on funding from a frog-themed token to support its on-chain stock trading system.

The story unfolds...

In the crypto field, speculation has many synonyms: market noise, bubbles, casinos. However, people have rarely acknowledged one point: that during the process of industry maturation, speculation can become the cornerstone upon which higher-level activities grow.

It must be clarified, though: not all bubbles can be transformed into a foundation. Bubbles that remain purely on speculation will inevitably burst quickly. However, if a bubble can combine with sustainable trading scenarios and continuously generate transaction activity, it can become a foundation that supports more businesses.

This is not a new phenomenon; it has repeatedly played out in the long history of financial development.

Let us recall the Chicago grain market of the 1840s. The Chicago Mercantile Exchange introduced the futures market with the original intention of helping farmers, whose harvests were fraught with uncertainty, to lock in selling prices in advance to minimize losses. But every farmer wanting to sell grain in the future needed a counterparty willing to take on the long position and bear the price risk. Speculators filled this gap. The essence of the risk-transfer market's operation is that speculative capital actively undertakes the price risk that farmers want to shed.

The key to the birth of the futures market was separating "physical grain" from "grain as a trading commodity." American historian William Cronon referred to this process as the abstraction of grain. Once grain trading was simplified to warehouse receipt notes, ownership could circulate freely, and speculators participated in trading on a large scale. The massive speculative trading created ample liquidity, allowing farmers to find counterparties at any time. This abundant liquidity ultimately enabled Chicago to grow into the global wheat pricing center.

Interestingly, at the time, a large number of people resisted and loathed these types of trades. The Grange movement publicly attacked exchange speculators, accusing them of profiting from the labor of farmers. However, this mechanism eventually evolved into an indispensable infrastructure for price discovery in the global agricultural economy. If there had been no speculators serving as counterparties in the 1870s, the global wheat market would not have a mature pricing system today.

The economist John Maynard Keynes' discussions on speculation are well-known, and his complete views clearly reveal the dual role of speculation. Keynes classified market activities into two types: industrial investment, which anticipates the returns generated during the long-term existence cycle of assets; and speculation, which anticipates the subsequent trading behavior of the market at large. He worried that in a liquidity-rich market, speculative behavior could negatively impact industrial investment.

By delving deeper into his discussions, one can see that speculation has dual aspects.

"If speculators are merely bubbles that arise on the wave of industry, they will not cause serious harm. But when industrial investment becomes a bubble atop the whirlpool of speculation, the situation becomes very dangerous. When the capital development of a country devolves into a by-product of casino activity, the enterprise of capital construction is likely to lead to failure."

Speculation that exists independently of underlying assets is highly risky; but if speculation is anchored to valuable underlying assets, it can play a positive role.

As early as the first book on securities markets — "Confusion of Confusions," written by Joseph de la Vega in 1688 — the author mentioned that the Amsterdam exchange attracted both investors and gamblers simultaneously. Most existing exchanges began this way. However, over time, this history has gradually been forgotten, and people have formed a stereotype that serious investment demand was the original intention behind the establishment of exchanges. This is not the case.

Looking Back at the Present

On August 5, the largest decentralized exchange in the crypto industry, Uniswap, launched the Pools issuance platform, allowing users to issue and trade meme coins on the Robinhood Chain. This blockchain was created by the brokerage of the same name, initially aimed at serving the platform's 30 million deposit accounts and facilitating tokenized stock trading.

The story goes beyond that. Before the official launch of the Pools platform, traders discovered unpublished smart contracts and completed transactions worth over $150 million through those contracts. This forced Uniswap to accommodate both the test network and official contracts, delaying the launch plan. The top token on the platform, FRONG, named after a frog video file used in Uniswap's pre-launch, was minted six days in advance under the same contract; on the official opening day, the number of token holders reached 12,141.

Everyone can interpret this event: a transaction involving about $150 million in funds traded a frog-themed token on infrastructure that had not yet officially launched, while this public chain was initially built for securities trading. Now FRONG has also become the unofficial mascot of the Pools platform. It is hard not to speculate that this was a deliberately orchestrated action meant to drive traffic to Uniswap's latest V4 version blockchain. Even if it was not a deliberate arrangement, the on-chain transaction volume for Uniswap V4 skyrocketed from $86.2 million to $228.3 million in just one day, nearly tripling.

But, as stated at the beginning of the article, not all bubbles and speculations can give rise to sustainable entities. Whether a speculative business can endure in the long term depends on the subject of its speculation. We can refer to shturl.c.

For many years, shturl.c has made speculation its core product, and it is now the largest meme coin issuance platform. On the platform, 70% of meme coins have a lifecycle of less than one day, with only a few surviving beyond a month.

@Coingecko

From January to July 2026, the protocol's fee income was nearly halved compared to the same period last year, totaling only $420 million. Nevertheless, it remains one of the most revenue-generating protocols in the crypto industry, with a total revenue of $620 million last year and a net profit of $584 million.

Another platform of similar type is Hyperliquid. The platform initially focused on high-leverage cryptocurrency trading to meet traders' directional betting needs. Later, it expanded the leveraged trading model to various all-weather trading and crypto-irrelevant assets. Based on the HIP-3 governance framework, the platform has now launched perpetual contracts for assets including Nvidia, Tesla, Nasdaq-tracked indices, gold, crude oil, silver, and stock indices. Whenever oil-related news breaks on Sundays, traders can immediately establish positions, while traditional markets do not open until Monday.

In early July, the trading volume of perpetual contracts for real assets surpassed that of cryptocurrencies in history for the first time, accounting for 52% of total trading volume.

Despite Hyperliquid's overall trading volume shrinking nearly by half compared to the 2025 peak, the growth of real asset trading volume offset the decline in cryptocurrency trading. This is the value that speculation can create: Hyperliquid has migrated the leveraged speculative model from native crypto users to categories like gold, pre-IPO equity, and stock indices, building a new all-weather pricing layer that many traditional trading platforms are now trying to imitate.

The Robinhood Chain is currently replicating this development path in real-time.

While the team positions this public chain as the underlying infrastructure for on-chain stock trading, CEO Vlad Tenev is pleased to see the traffic brought in by meme coin traders.

"We built the Robinhood Chain with the goal of becoming the optimal public chain for real asset trading... but its performance in trading meme coins is equally outstanding."

Thanks to the surge in meme coin trading, this public chain surpassed the Base chain in daily active users just three weeks after its launch. The traffic and capital generated from meme coin trading are the seed capital for future development of the on-chain stock trading system.

Of course, this does not mean that speculation will ultimately be able to upgrade into mature business operations. Whether it can complete the transformation depends on the platform's choices.

Robinhood holds 30 million deposit users, has multiple business lines, and its strong distribution capability is expected to transform the traffic from meme coin trading into a user base for on-chain securities trading. We can observe that its market revenue prediction for the second quarter skyrocketed more than tenfold year-on-year, reaching $156 million, accounting for 20% of the platform's total trading revenue.

The Nature of Speculation

Many people have always struggled to understand speculation. Speculation itself is not inherently good or bad. Stripping away all additional labels, speculation is simply one of humanity's oldest instincts.

When people transform their views into financial bets, speculation naturally arises.

From its most primitive form, speculation is the liquidity that seeks pricing subjects everywhere; wherever liquidity flows will determine the pricing of that subject. The subject can be a bag of wheat, Nvidia stock, a frog video called frong.mp4, the outcome of a football match, or the probability of a presidential candidate winning.

The properties of the underlying assets themselves determine the direction and boundaries of the evolution of speculation. Once valuable underlying support is lost, the same amount of funds used for speculation is unlikely to yield long-term, valuable results. This principle runs through the history of financial development, and the crypto industry is walking down the same path.

Hyperliquid has bound leveraged trading to assets like gold, building a new pricing system in just two years; Robinhood, leveraging the unexpected traffic from meme coin speculation, is simultaneously constructing the underlying channel for on-chain securities trading.

What kind of system speculation can ultimately construct depends on how much value the underlying assets can carry.

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