BlackRock buying UNI and other DeFi updates, with Lido and Chaos Labs

Speakers

Kelvin Sparks — Host

Tim Copeland — Co-host

Will Shannon — Head of Node Operators at Lido

Craig Lurich — Head of Vaults at Chaos Labs

Summary

BlackRock has moved beyond equity investments in crypto infrastructure to directly purchasing DeFi governance tokens (specifically UNI), signaling a major shift in institutional strategy toward active governance participation.
Aave is proposing to direct 100% of protocol revenue to the DAO, a move that removes market uncertainty regarding token value accrual and sets a precedent for "Blue Chip" DeFi tokens.
Lido is launching V4 "Vaults" to allow institutions to customize staking parameters (e.g., specific node operators), solving the compliance and counterparty risk issues that previously prevented large-scale institutional capital deployment.
Chaos Labs warns that DeFi yields exceeding 20% are currently in the "danger zone" and unsustainable, advising investors to target <10% yields for genuine passive income rather than speculative trades.

Trade Ideas

Ticker	Direction	Speaker	Thesis	Time
UNI /AAVE	LONG	Tim Copeland Co-host, Head of Growth at The Block	Tim notes that BlackRock is explicitly buying UNI tokens, not just equity in Uniswap Labs. Separately, Craig notes Aave is proposing to direct 100% of revenue to the DAO. BlackRock's direct token purchase validates the "governance token" as an investable asset class for institutions, moving beyond just holding BTC/ETH. Simultaneously, Aave's revenue switch solves the "useless governance token" narrative, creating a clear path for cash flow to accrue to token holders. These two events signal a repricing of "DeFi Blue Chips." Long the market leaders (UNI/AAVE) as they transition from speculative assets to cash-flowing, institutionally-held assets. Regulatory pushback against revenue-sharing tokens (securities laws); BlackRock using voting power against the ethos of the protocol.	2:54
LDO	LONG	Will Shannon Head of Node Operators at Lido	Lido is launching "Staking Vaults" (V4). This allows institutions to curate specific node operator sets rather than using the general, socialized pool. Many institutions (like banks or ETF issuers) cannot legally or risk-wise use a permissionless, randomized set of 700 node operators. By allowing them to "ring-fence" their validators via Vaults, Lido removes the primary compliance blocker for billions in institutional ETH to enter the protocol. Long LDO as the total addressable market (TAM) for liquid staking expands to strictly regulated capital. Complexity in the new vault architecture leading to smart contract bugs; competition from institutional-only staking providers.	—
DEFI YIELD FARMING	AVOID	Craig Lurich Head of Vaults at Chaos Labs	Craig states that yields above 20% in the current market are the "danger zone" and compares them to the collapse of Anchor Protocol. The demand for leverage has cooled. Therefore, any protocol offering >20% APY is likely subsidizing it with inflationary token emissions or taking on opaque, catastrophic risk (like uncollateralized lending). Sustainable yield is currently <10%. Avoid or Short protocols promising "too good to be true" yields (>20%) as they are likely structurally unsound. A sudden bull market mania could temporarily sustain high yields through Ponzi-nomics, squeezing shorts.	—
COIN /CEXS	WATCH	Craig Lurich Head of Vaults at Chaos Labs	Chaos Labs is powering "Kraken Earn" using on-chain vaults to provide yield to Kraken users. Centralized Exchanges (CEXs) are pivoting from simple trading venues to "DeFi Mullets" (Fintech in the front, DeFi in the back). They are integrating on-chain yield directly into user accounts. This benefits the exchanges (retention) and the underlying DeFi protocols they utilize. Watch CEXs (like Coinbase/Kraken) for increased earnings derived from "Earn" products as they capture DeFi yields for retail users. Regulatory crackdowns on "Earn" products (similar to the SEC vs. Gemini/Genesis).	41:16