This episode of The Chopping Block features host Steve (Dragonfly), Tom (DeFi Maven), Tarun (Colony), and returning guest Robert Leshner (founder of Superstate), who has been away recording a new podcast called The Pop focused on IPOs and capital market mechanics.

The conversation opens with the SpaceX IPO — the largest in history at a $1.75 trillion valuation — examining its unusually low 4.2% float, retail allocation failures across crypto platforms like Binance and Bybit, and the remarkable predictive accuracy of Hyperliquid perps markets. The group also digs into Trade XYZ's growing dominance as the primary HIP-3 integrator and what that means for the broader Hyperliquid ecosystem.

The second half covers Anthropic's dramatic shutdown of Claude Fable 5 following export control enforcement triggered by an Amazon-to-Treasury escalation, the cybersecurity jailbreak that prompted it, and what the episode means for decentralized AI narratives. The hosts also debate Chinese open-source model competitiveness, GPU depreciation economics, and the long-term pricing trajectory of frontier AI tokens.

SpaceX IPO: Low Float, Massive Pop, Retail Locked Out

SpaceX launched at a $1.75 trillion valuation with a 4.2% float — far below the 10-20% typical for major IPOs like Facebook (13%) and Microsoft (15-20%) — creating extreme scarcity dynamics that drove a 20%+ first-day pop.

Retail access was severely constrained: Fidelity waived its usual $100K-$200K minimum down to $2,000, yet most retail investors only received 10-30% of their requested allocation.

Crypto platforms including Binance and Bybit were completely cut out of their IPO allocations as the deal went from lightly subscribed to 5x oversubscribed within two days.

SpaceX's unlock schedule is unusually aggressive: starting possibly end of July, 20% of non-keyholder stock becomes available right after Q2 earnings, with Elon and keyholders locked for a full year.

"The first unlock comes... there's a pretty aggressive unlock schedule starting possibly at the end of July" - Steve

Elon's year-long personal lockup was described as a positive signal to markets.

The SpaceX deal structure drew comparisons to crypto tokenomics: low float, high FDV, aggressive unlocks, and using highly valued stock (like FTT or BNB) to acquire companies like Cursor in an all-stock deal.

"This is the crypto playbook. This is actually the closest thing to crypto that I have seen" - Steve

Brian Armstrong publicly called for revisiting accredited investor laws in the wake of the IPO, reigniting debate about retail access to private market appreciation.

The group largely agreed removing accredited investor laws wouldn't meaningfully change access to hot private companies — supply constraints dominate.

Robert noted SpaceX was unusually widely shopped via SPVs for years: "Florida dentists are like, oh yeah, I got SpaceX allocation" - Robert

Hyperliquid Perps Nail SpaceX Pricing, But Ecosystem Remains Thin

Hyperliquid perps implied a $162 open for SpaceX; the actual first-day close was $161 — a remarkably accurate prediction that generated $1.4 billion in single-day volume on Trade XYZ alone.

Trade XYZ has become so dominant among HIP-3 integrators that the group suggested the protocol should be renamed: "TIP-3 maybe should be renamed to Trade" - Tarun.

Competitors like Felix and Benchmold have shut down; DreamCash briefly had market share via token incentives but faded.

Trade XYZ's own frontend contributes relatively little direct volume — most flow comes through third-party integrations tracked via builder codes.

The group debated whether Trade XYZ would ever break away from Hyperliquid, concluding the network effects are too strong and the more likely outcome is Trade negotiating a larger fee share — similar to how Circle negotiates USDC margins.

HyperEVM was described as essentially dead, with many teams folded or acquired: "It's really hypercore that's having a moment" - Steve.

Tarun raised the irony that crypto-native complaints about VCs hedging unlocks via perps now apply directly to SpaceX insiders, who could theoretically short the equity perp to hedge their upcoming unlocks at much lower cost than traditional OTC forwards.

Legally, locked-up shareholders are not permitted to hedge via short positions, but the economics of doing so via perps are more attractive than traditional structured products.

Tokenized Stocks at IPO: The Infrastructure Mostly Failed

Platforms that promised IPO-price allocations ($135/share) largely failed to deliver as the deal became oversubscribed; platforms that simply offered post-listing trading at market price ($167+) worked fine.

"The process of transporting an IPO allocation that was done through the official bank syndicate totally failed across the board" - Robert

Coinbase's 'System Update' event announced tokenized stocks with full dividends and voting rights, options trading, thematic indices trading 24/5, combo prediction markets, and an SEC-registered AI financial advisor chatbot.

The AI advisor demo showed it recommending SpaceX call spreads when asked how to bet on SpaceX.

15-minute directional crypto bet markets were also added, drawing comparisons to similar products FTX launched years earlier.

Anthropic Fable 5 Shutdown: Export Controls, Jailbreaks, and AI Censorship

Fable 5 (the commercial version of the Mythos model, gated via Project Glasswing) was shut down days after launch when export controls were enforced, preventing non-US users from accessing it.

Anthropic lacked sufficient KYC infrastructure to confidently enforce the controls, so they shut down access entirely.

The triggering event: Amazon's cybersecurity team demonstrated to Andy Jassy that Fable could be used offensively by pointing it at a codebase and asking it to 'fix bugs' — it would identify and patch vulnerabilities, enabling offensive hacking.

"The jailbreak was if you tell it to fix a bug, it will fix bugs" - Steve

Jassy reportedly called Dario Amodei, who didn't pick up, then escalated to Treasury Secretary Bessent.

Tarun noted far worse jailbreaks were publicly found almost immediately — Pliny the Elder extracted the system prompt within 10 minutes — making the government's specific concern seem relatively minor.

A Polymarket on Fable's relaunch prices a 77% chance it's back by end of July; a separate market prices a 50-50 chance the export controls are lifted entirely.

Robert framed the shutdown as a useful stress test: "I think right now we need the ability to turn things off. I think this is a dry run of pressing a pause button" - Robert.

He argued testing pause mechanisms before acceleration intensifies is valuable, even if this specific instance was an overreaction.

The episode drew strong parallels to crypto's early history: export controls on cryptographic software, the cypherpunk movement, Adam Back's legal battles, and the emerging demand for permissionless, censorship-resistant AI inference.

Anthropic sent users a privacy policy update hinting at future KYC requirements, prompting backlash about 'KYC models.'

OpenRouter's new Fusion model — orchestrating multiple open-source models — was cited as a potential censorship-resistant alternative claiming near-Fable-5 performance.

Chinese Open-Source Models vs. US Frontier Labs: The Compute Debate

Zhipu's GLM 5.3 was cited as the latest example of Chinese labs achieving top-tier performance at a fraction of US compute budgets, with Tarun calling Grok "an embarrassing piece of shit" by comparison given xAI's resource advantage.

"The amount of resources spent... compare Grok to like the Chinese models. It is unbelievable how bad it could be given how much compute they built for it" - Tarun

The group debated whether the DeepSeek-style efficiency thesis — that training compute requirements are falling — threatens the US data center buildout thesis, which is funded by expected future revenue from a small set of frontier lab customers.

Steve argued demand for very high-end compute will keep exploding as AI expands into law, accounting, and other domains beyond coding.

Tarun countered that open-source distillation models are eating into this, and the Chinese model of cheap, open inference will grow as a percentage of global token demand.

Refurbished GPUs were highlighted as having anomalous pricing power — depreciating negatively over time — in contrast to frontier model tokens, which the group agreed face steep price decay curves.

Steve referenced Michael Burry's critique of GPU depreciation accounting, noting the market has since validated that GPUs should have been negatively depreciated.

Fable 5 is priced at roughly $50 per million tokens (double Opus at ~$25); the original Mythos pricing was reportedly 5-6x Opus output token prices.

Tarun raised a scenario where the US bans inference providers from serving Chinese open-source models — a TikTok-style argument about data flows to Chinese labs — as the event most likely to trigger mass adoption of decentralized inference.

SBF, Anthropic's Cap Table, and Claude's Self-Awareness

SBF invested $500 million in Anthropic at approximately a $4 billion valuation; that stake became a major asset in the FTX bankruptcy estate and is now worth billions, with the group estimating roughly $3 billion in value.

"He absolutely aped in" - Steve, describing the investment made before ChatGPT and before LLMs were widely understood.

The group live-tested Claude Sonnet (which incorrectly denied FTX invested in Anthropic) versus Claude Opus 4, which correctly confirmed the investment and offered a nuanced take on whether its existence is 'owed' to SBF's crimes.

Opus 4 response: "Anthropic would very likely exist either way, given its founding team and other backers" — though the group pushed back that the scale of early capital was meaningfully impacted.

SBF's appeal to have his case dismissed was denied by the appeals court, prompting the observation: "Proof that no amount of financial success in death will save you from breaking the law" - Steve.