Hi, I'm Dean
I'm a cofounder at a stealth co. building agentic AI infra.
Our interface has processed 200B+ tokens, and we collaborate with university labs.
Outside AI, I run a crypto prop trading desk (since 2022) focused on arbitrage and news.
We deploy $18M+ in firm capital and are among the fastest on token listing alerts.
Previously: UIUC CS. NCSA research assistant in distributed systems. Helped maintain Blue Waters.
Writing
TL;DR. The public Desmos graph many people use for Curve leaves out an NN factor in the constant compared to the whitepaper. If you read exchange rates from that graph, you will underestimate curvature and pick an A that is too small. On-chain, get_y is solving the invariant (Newton iteration); it is not redefining the constant.
Motivation — why it matters
- Wrong A → wrong slippage expectations under imbalance, misplaced alerts/hedges, and bad liquidity incentives.
- When N>2, the gap grows quickly because the missing factor is NN.
What the contract actually solves
Let N be the number of coins and x1,…,xN their balances. The invariant D is computed via get_D(x, A). When swapping into coin j, the contract solves for the new balance y of coin j so that the invariant holds for (x1,…,xj-1, y, xj+1,…,xN).
Define
$$ S' = \sum_{k\ne j} x_k,\qquad P' = \prod_{k\ne j} x_k. $$
Keeping D fixed, the update in the unknown y reduces at each Newton step to a quadratic
$$ y^2 + b\,y = c, $$
where b and c are deterministic functions of \(D, A, N, S', P'\) (as in get_y). The positive root gives the next iterate for y. This is why the implementation line you saw is from a solver, not a symbolic invariant.
Why the Desmos curve is off
The Desmos setup drops NN in the constant term—effectively a rescaling that flattens the curve. If you try to match on-chain behavior with that graph, you must multiply the A you read off (roughly) by more than N. Example (N=2): with \(K = \tfrac{2Axy}{D^2} = \tfrac{200xy}{D^2}\), the local slope crosses about \(-1.008\) near \(x=0.33D\).
Quick calibration recipe
- Pick the target imbalance point (e.g., \(x=0.33D\)) and your pool size N.
- Compute on-chain (or in your sim) using
get_Dthenget_yto get the slope at that point. - In Desmos, either multiply the constant by NN, or—if you can only tweak A—scale A upwards until the slope matches the on-chain slope.
Many people lump STEPN with P2E and a wave of rushed "Move to Earn" clones. That framing misses what makes STEPN distinct.
STEPN vs. GameFi
Is STEPN a game? In Sid Meier's words, "a game is a series of interesting choices." Repairing and upgrading scarce GST, deciding whether to fuse gems, opening or selling mystery boxes—these are all choices.
But STEPN does not need to be a game in the traditional sense. It is strategic without immersion, cut-scenes, or high-fidelity art. That is a feature, not a bug. Games compete on intrinsic fun. Fitness products sell external incentives and accountability.
In P2E, players often show up to make money, not for joy. When novelty fades, intrinsic motivation collapses and churn spikes. STEPN inverts this: external incentives help users build a durable exercise habit. Daily output caps and a long arc of goals nudge consistent behavior rather than bingeing.
I love Ring Fit Adventure and Just Dance, but once "finished," my motivation dropped. With STEPN I have kept going for three months and counting, because the system layers short, mid, and long-term objectives. As Sid Meier's Civilization design philosophy puts it, the best systems always leave you with something to anticipate.
If you still compare STEPN to Axie Infinity, look at the user structure. There are no guilds, no live rental market; NFT holders are the actual users. The team even reintroduced invite codes to throttle growth and protect the economy. In many P2E ecosystems, asset owners and players are split: surveys have shown low overlap between Axie players and AXS holders, and titles like Pegaxy concentrated ownership in guilds. Not everyone likes to play P2E. Nearly everyone can go for a walk.
STEPN vs. SocialFi
SocialFi has struggled: porting social graphs is hard and token incentives are often misaligned or unnecessary. STEPN sidesteps this. The app plays like a single-player loop, but strategy talk, randomness (opening boxes), and meta discussions create organic social energy outside the client. Think of esports metas or the Elden Ring discourse—community forms around systems, not feed mechanics.
It is also mainstream-friendly. STEPN ties to real-world relationships and health, so clusters form naturally among friends and family. Even in the worst case, it is easier to recommend a green fitness app than a collectible monster game.
STEPN vs. Move to Earn
Comparable fitness apps split into two groups:
- Apps that require external hardware
- Apps that do not
Hardware limits adoption. Ring Fit needs both a Switch and a Ring-Con; Just Dance leverages a phone gyroscope and goes cross-platform, which helps explain the sales gap.
Among hardware-free apps, STEPN's edge is verification. GPS and motion signals let the system cross-check movement, user state, and outcomes. Without credible proof of movement, fair "earn" is impossible.
Anti-botting is a moving target. The durable moat is not any single rule, but a fast, decisive team that treats integrity as a product surface.
STEPN is less "GameFi with steps" and more a habit engine with incentives and proof of movement. That positioning creates a different user structure, a healthier economy, and a clearer path to mainstream retention.
In today's DeFi era, perp DEXs have become a prominent narrative. These platforms let users transition from CEXs to a more decentralized environment, replicating familiar benefits while adding some degree of decentralization.
However, most perp DEXs rely on off-chain order books, primarily due to smart contract computational limits. These implementations range from fully centralized matching engines to multiple trusted parties maintaining off-chain books. While this seems like a sensible trade-off—keeping settlement on-chain—it opens up exploitation through MEV.
The Matching Problem
Order matching is fundamental to any exchange. If left in the hands of privileged parties, it's susceptible to exploitation. An off-chain scenario could violate price-time priority, matching an incoming order against a later offer at a worse price. An on-chain order book would inherently match against the best and earliest liquidity.
Proposed off-chain solutions often involve social consensus with punishment mechanisms. But these systems are fallible and can be manipulated. The only assured way to ensure fair order books is maintaining the entire state on-chain. This might sound theoretical, but the issue is significant in practice.
MEV Beyond Transaction Ordering
Off-chain order books are vulnerable to MEV at the matching level, not just transaction ordering. This creates an environment where market makers can't quote reasonably, and good liquidity gets monopolized by traders colluding with order book operators. User liquidity suffers.
The alternative is running a centralized matching engine with a reputation for fairness. But this contradicts decentralization. If an exchange is inclined to this method, they may as well operate a CEX, sacrificing transparency for most operations.
The Path Forward
Order books must exist on-chain. This mandates infrastructure innovation, but it's necessary to ensure MEV exists only at transaction ordering, not order matching.
Building a successful decentralized exchange is complex—from user acquisition to liquidity maintenance. Adding decentralization makes it unsurprising no perp DEX has achieved mass adoption yet. But the landscape could shift within a year.
On-chain order books are vital to protect end-users. In my view, the most mature solution currently is off-chain matching with on-chain settlement. For perp DEXs, dYdX is a well-established model that balances these trade-offs.
Amidst the market's recent turbulence, many have asked for my current outlook. My core thesis hasn't fundamentally shifted, but I believe this is an opportune moment to articulate my framework for why the vast majority of crypto assets are valued at levels fundamentally disconnected from reality.
The principle is remarkably straightforward, yet widely ignored.
The Monetary Premium Reality
Crypto's primary, and arguably its only, widespread product market fit by dollar value has been as an alternative, speculative store of value (SoV). This is the foundational reason why Bitcoin, even after 15 years, maintains its hegemony. Ethereum, since circa 2020, has also cultivated its own potent monetary premium. Combined, these two assets command the lion's share of the market (over 75% excluding stablecoins) and an even greater portion of its liquidity. Legacy tokens like XRP and ADA also persist due to a similar, albeit smaller, demand profile.
Over the years, we have been inundated with grand theses for crypto, with doomer theories of imminent global economic collapse being a perennial favorite. Ironically, the global economy has proven exceptionally resilient, continuing its march of growth and productivity. This prosperity, in turn, has fueled greater demand for nonsovereign, alternative stores of value like BTC and ETH. Regardless of the narrative du jour, crypto has consistently ridden the powerful wave of monetary demand.
An Economy Without Productivity
This has birthed a new digital economy, anchored by BTC and ETH. The glaring problem, however, is that this economy is largely devoid of genuine productivity. This is the natural consequence when the overwhelming majority of an asset's value is derived from passive holding and speculation, rather than from generating economic output.
And here, speculation becomes the engine of the entire system.
You will find a staggering number of tokens (over 70 at last count) boasting valuations north of $1 billion. Many of these are zombie projects that have been around for years, pivoting endlessly without ever achieving meaningful product market fit. New tokens, with patently limited potential for any foreseeable use case, are inflated to multibillion dollar valuations overnight. The result is a market where assets that should, by any fundamental metric, be worth a few million at best are priced in the billions on the infinitesimal chance they might one day be worth something. Hundreds of other tokens, which are self evidently worthless, continue to trade for millions. This is all sustained by a massive speculative premium, a derivative of the industry's SoV backbone.
The Outliers
To be clear, I am not a nihilist. Pockets of genuine innovation and productivity do exist, but they are profound outliers. For instance, projects like Pendle and Curve are personal favorites of mine. Why? Because they have sustainable, real yield revenue models and are designed with positive value accrual incentives for their token holders. Hilariously, these productive assets are often undervalued, even when benchmarked against traditional value stocks, which speaks volumes about the market's priorities.
The Inevitable Fade
So, what is the solution? There is no magic bullet. This is the intrinsic nature of the industry. The dominant strategy has been, and continues to be, to gamble on speculative narratives and rotate profits back into an asset you deem to be a reliable store of value.
Of course, every asset has a demand ceiling. We witnessed the end of Bitcoin's exponential growth phase in 2017; its performance since has been modest, barely outpacing the NASDAQ. Diminishing returns are an inevitability. As the market for alternative monetary properties approaches saturation, the momentum will fade. We see this play out in micro cycles constantly. Take the recent narrative around Digital Asset Treasuries (DAT). As the hype cycle fatigues and the story becomes less compelling, you can expect buying pressure to wane significantly. Let's wait and see, but it is a classic pattern. This will eventually trigger a long, slow bleed to near zero for the legion of grotesquely overvalued tokens, a process that will likely take many years of sideways market action to fully play out.
In the here and now, however, the crypto market remains what it is: the most extraordinary and utterly unhinged casino the world has ever witnessed, completely detached from reality. And it will likely persist in this state for far longer than any rational mind might expect. The key is to see the game for what it is and play it accordingly.
Was just reviewing the market today, and it's wild how completely the crypto game has changed in just a few years. The meta shifts so incredibly fast.
Think back to 2021 and before. It was easy mode. The market was flooded with retail longs, which meant you could just sit back and farm those juicy funding fees. Opening a position was a non-issue; I was comfortably running 5x leverage on alts as a default play.
Then came 2022. Retail got absolutely farmed and finally learned how to short. So, the smart money adapted. They started pumping obscure, low-cap coins to bait all the new shorts in. Once the trap was set, they'd just keep buying up spot. The perps would trade at a huge discount to spot, and the negative funding would bleed you dry. You simply couldn't hold on.
Fast forward to now, let's call it '25. Retail is no longer falling for that trick; they know shorting illiquid alts is a death sentence. This created a new problem for the market makers: they lost their counterparty. They had no one left to trade against. So, the game evolved again. The new meta is hunting the arbitrageurs.
We've seen it play out. That $PUMPBTC incident was almost certainly a big fund getting blown up for tens of millions on a basis trade. The price doubled in three minutes, and in the next minute, their position was down $40 million. A textbook case of an arb trade getting liquidated, triggering an ADL cascade that lets the house clean up. The moves on $HYPE and $XPL were the same playbook(pure manipulation to blow up arbs). We saw it again last night with $SERAPH on Bybit.
I run these small-cap arb trades too, but my risk is managed on a different level. My liquidation price is usually set for a 100x move. It means even if a coin pulls a 10x in a single day, I have more than enough room to breathe.
For small capital, it's manageable. If a trade starts to look bad, you just cut it. Simple. But for big money, it's a trap. You can't get out. They are the ones hunting you.
Imagine this: you have a 20 million margin account and you open a 1 million arb trade on a small-cap. Your liquidation price seems miles away, maybe at a 20x move. But then they orchestrate one of those violent, 10x pumps in a single day. All of a sudden, the notional value of your position has ballooned to $10 million. In a market this thin, you can't exit a position that size. There's no liquidity to absorb it. The moment you try to de-risk, you'll cause massive slippage against yourself, which only accelerates your own liquidation. You're trapped. And the market makers know it. They are pushing the price with the sole intention of blowing you up.
The Basis Trade is Dead: Welcome to the ADL Meta.