Kyle Reidhead, Co-Owner of Milk Road, on The Current Crypto Market, “The Fat App” Thesis, and Coinbase Becoming a Trillion Dollar Company by 2030 | Ep. 423

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March 26, 2025 04:47 EDT

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Kyle Reidhead, Co-Owner of Milk Road and Founder of Impact3, joined the Cryptonews Spotlight Podcast for a comprehensive conversation on the current crypto market, where value accrues in the Web3 stack, Solana vs. Ethereum, AI agents, DeFi, and why Coinbase could become a trillion-dollar company by 2030.

Known for bold yet accurate calls – like Solana under $20 and Coinbase at $38 – Kyle brings macro insight and high-conviction investment logic to the forefront.

The Macro Setup: Short-Term Pain, Long-Term Gain

“We’re in a bit of a growth scare… short-term pain for long-term gain.”

Reidhead believes the U.S. is deliberately manufacturing a slowdown to force rates lower ahead of a massive debt refinancing in 2025. While that means volatility now, he sees a strong setup into late 2024 and through 2026, driven by lower rates and renewed liquidity.

Why the Bull Market Might Last Longer Than Expected

“We might actually get regulatory clarity and a continued macro bull market, which is really exciting.”

Kyle sees an opportunity in the convergence of macro recovery and regulatory breakthroughs. As lawsuits fade and institutional doors open, apps are being allowed to flip fee switches and buy back tokens – a trend that could accelerate.

The Fat App Thesis: Where the Real Value Is Going

“Blockspace is becoming commoditized… where the leverage is going is to the apps that actually have the users.”

As L1s compete to lower fees, Reidhead argues that value capture is shifting to applications, mirroring how Web2 favored platforms like Google and Facebook over backend infrastructure.

Coinbase’s Leverage Over On-Chain Protocols

“They can go to Aave or Morpho and say, ‘Give us a better deal, or we’ll switch.’ They own the users.”

Kyle explains how Coinbase now has pricing power, as it integrates protocols into its app. This puts Coinbase in control of margins and makes token-based monetization far more efficient.

The Rise of Revenue-Generating DeFi

“These apps can start to generate a hell of a lot of revenue, have next to no expenses… and buy back their tokens.”

Protocols like Sky and Aave are proving that on-chain businesses can be highly profitable, especially with low headcount and the ability to auto-buy back tokens.

ETH and SOL Price Outlook

“We could see Solana hit $500+… and ETH go above $5K, maybe even $7K.”

Reidhead sees both ETH and SOL as strong mid- to long-term plays, with Solana already showing unmatched user engagement and Ethereum likely to rebound when liquidity returns.

Managing Expectations: DCA Smart, Don’t Chase 10Xs

“If you can grab a two, three, four X in the next year, that’s amazing.”

Reidhead cautions newcomers against chasing meme coins or expecting 10X gains late in the cycle. Instead, he advocates for dollar-cost averaging into quality and letting time compound returns.

Why Coinbase Could Be a Trillion-Dollar Company

“They’re building the Apple of crypto. The onchain experience is becoming seamless within the Coinbase app.”

Coinbase controls the app, the chain (Base), the wallet, and the stablecoin (USDC). Like Apple, it owns the ecosystem and UX. And with Coinbase Prime’s institutional moat, it has massive platform potential.

Network Effects, Trust, and Moats

“Coinbase is something like 15% of all crypto assets. Everyone uses them – from BlackRock to Michael Saylor.”

Trust, especially in finance, is everything. Coinbase has it. With custody leadership, regulatory alignment, and widespread adoption, it’s the default American crypto brand.

Base Still Has UX Issues

“Base isn’t there yet in terms of UX. Solana still wins for speed, efficiency, and ease.”

While bullish on Base long term, Reidhead admits that Solana remains superior for retail, especially in the meme coin-driven adoption funnel. Coinbase will need to improve Base’s experience.

AI Agents Are Coming – But Not This Year

“Bullish long term, a little bit bearish short term. They’re not ready to manage money yet.”

Reidhead is excited about AI agents trading onchain but says most current projects aren’t ready. He expects next year to bring real breakthroughs, not 2024.

Celestia (TIA): The Next Big Narrative

“Blockspace is done. The next big thing is blobspace. TIA is going to have a big run.”

Reidhead’s top contrarian bet is Celestia (TIA), betting that data availability will become the hottest infrastructure trend – especially as more rollups come online.

No More Room for General-Purpose L1s

“Solana and ETH have network effects. Everyone else is late. It’s appchains from here on out.”

Kyle believes L1 wars are over. The winners are established. The future lies in application-specific rollups and chains with real user bases.

Institutional Flows Will Target OG DeFi

“Institutions aren’t going to ape into meme coins. They’ll go where there’s revenue, real users, and token buybacks.”

With DeFi protocols now generating hundreds of millions, Kyle expects a surge in institutional interest, particularly in cash-flowing, proven names like Maker, Aave, and Morpho.