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Had a Jane Street interview in 2019.
Round 8. Interviewer texts: 'Equinox Brookfield. 6 AM. Bring a calculator you won't use.'
I show up. He's on the StairMaster reading a printout of the CBOE VIX term structure.
Doesn't get off. Nods at the machine next to him.
'You see that guy on the rower? Goldman MD. Comes here every morning at 6:04. Leaves at 6:38. What's the implied vol on his arrival time?'
'I don't know his variance.'
'Sample size of one year, 250 sessions. Standard deviation is 90 seconds. Annualize it.'
I do the math in my head. '90 seconds times sqrt(250). About 24 minutes annualized.'
'Wrong. You annualized like it's a return. Time-of-arrival doesn't compound. It's a Poisson process with drift. The correct answer is his arrival is more punctual than the 6 train. Now price me an option on whether he shows up tomorrow.'
I think for a second. 'If he's been here 250 days in a row, base rate is 99.6%. But you have to adjust for his vacation schedule and probability of injury, call it 96%.'
'Strike?'
'$10 if he shows, $0 if he doesn't.'
'I'll sell you that option for $9.40.'
I think about it. 'No. Expected value is $9.60. You're underpricing by 20 cents.'
'Correct. Now why am I selling it to you?'
I freeze.
'Because I just saw him limp on the way in. You're buying my information for 20 cents. You overpaid.'
We get off the machines. Walk to the smoothie bar. He orders a $19 smoothie, doesn't drink it.
'Last question. The girl behind the counter makes 200 smoothies per morning. She has perfect information on who's actually here and who's faking it. Citadel guys leak their attendance to her every day for the price of a tip. If I gave you $50,000 to set up a market on which Citadel PM gets fired this quarter, what's your bid-ask?'
'Insider trading.'
'Wrong answer. There's no public security. Try again.'
I think. 'I'd quote 8 to 12 percent on any given PM. Spread of 4 points to cover adverse selection. Tighten the spread for PMs I have data on.'
'Where do you get the data?'
'The smoothie girl.'
'Good. How much do you pay her?'
'10% of P&L.'
'Wrong. You pay her a flat $200 a week. If you pay her on P&L she becomes your counterparty. Right now she's your data source. Don't conflate edges.'
He hands me the untouched smoothie.
'Throw this out on Vesey Street, not in the building. The staff knows what gets wasted. Outside, it was consumed. Same smoothie, different signal.'
I do it.
Thursday I get the email.
'Offer rescinded. Your bid-ask on the PM market was too tight. 4 points doesn't cover the tail. The girl is a single point of failure and you didn't price her counterparty risk. Also you held the smoothie in your right hand. Right-handers throw with their right hand. Camera saw the hesitation.'
Jane Street made ~$40B in 2025 with 3,500 employees, a ~2x from the year before.
At ~65-70% profit margin, that's $8M profit / employee, the highest for a 1000+ ppl company. High-frequency trading continues to be the most efficient money making engine.
I want to share an old story about my Jane Street interview in 2014. Jane Street was known for hiring a lot of math, physics and CS olympiad winners from top universities and putting them through many rounds - including, for trading roles, a gauntlet of mental math. It was my 6th interview and my final round and I recall being asked "What is the next day after today in DD/MM/YYYY where all the digits are unique?" They'd toy with you and say "You can use a pencil and paper, if you want" but you knew that was an instant no. Painstakingly and as quickly as I could, I came to an answer. "How confident are you that this is correct on a 0-1 probability scale?" the interviewer said. "0.95", I blurted out, not fully knowing how to answer that. "Are you sure?" After thinking harder for a few more seconds, I realized I could've flipped the digits around to get a closer date. I gave the interviewer my answer. It was correct. "0.95 huh?" he chuckled. That's when I knew I failed.
Note: fwiw, other companies that come close in efficiency are
- Tether ($90M+ profit/emp)
- Hyperliquid ($80M+ profit/emp)
and on revenue:
- Valve ($50M/emp)
- OnlyFans ($37M/emp)
- Craigslist ($14M/emp)
- Anthropic ($12M/emp, run rate)
- OpenAI ($8M/emp, run rate)
For comparison, Nvidia is very efficient at scale and is $4.4M/emp.
André retweeted
.@boros_fi by @pendle_fi is probably one of the more sophisticated DeFi products out there right now.
We've had perps for years, with billions in open interest across exchanges, but the funding rate itself has been relatively difficult to trade independently.
Especially considering how much capital is deployed in delta-neutral strategies where funding is a major component of returns.
Boros creates a market for that exposure, allowing traders to take positions on expected funding rates through Yield Units (YU), with an implied APR determined by the market and settlements based on realized funding.
The mechanics are pretty clever:
Long YU = pay fixed, receive floating.
Short YU = receive fixed, pay floating.
Say the implied APR for BTC funding on Hyperliquid is 12% over the next 60 days, but you expect the realized rate to average 20%.
Going long YU gives you exposure to that 8% spread.
On $1M notional, that's approximately $13.2K over 60 days before fees, assuming you hold to maturity and realized funding averages 20%.
The hedging side is where this becomes particularly useful.
If you're running a spot-long/perp-short basis trade, you're collecting floating funding, which can fluctuate considerably depending on market conditions.
Shorting YU against that exposure lets you receive a fixed rate while offsetting the floating component, effectively locking in the funding portion of your carry.
You can also trade funding spreads between venues, opening up strategies around relative funding rates rather than just taking a view on a single exchange.
There's another layer of complexity around how these positions are priced and margined.
Even if the realized funding is moving in your favor, changes in implied APR can affect mark-to-market PnL and margin requirements before maturity.
So there's still liquidation risk, even for someone running an otherwise delta-neutral strategy.
It's interesting to see crypto derivatives developing to this level, especially as perp markets become increasingly liquid and institutional trading strategies become more common onchain.
I'd expect funding-rate markets to become more relevant for market makers, basis desks and funds looking to manage their carry exposure more precisely.
André retweeted
Most impressive thing I’ve ever seen.
I would like to invest my entire net worth in Cognition now
.@boros_fi by @pendle_fi is probably one of the more sophisticated DeFi products out there right now.
We've had perps for years, with billions in open interest across exchanges, but the funding rate itself has been relatively difficult to trade independently.
Especially considering how much capital is deployed in delta-neutral strategies where funding is a major component of returns.
Boros creates a market for that exposure, allowing traders to take positions on expected funding rates through Yield Units (YU), with an implied APR determined by the market and settlements based on realized funding.
The mechanics are pretty clever:
Long YU = pay fixed, receive floating.
Short YU = receive fixed, pay floating.
Say the implied APR for BTC funding on Hyperliquid is 12% over the next 60 days, but you expect the realized rate to average 20%.
Going long YU gives you exposure to that 8% spread.
On $1M notional, that's approximately $13.2K over 60 days before fees, assuming you hold to maturity and realized funding averages 20%.
The hedging side is where this becomes particularly useful.
If you're running a spot-long/perp-short basis trade, you're collecting floating funding, which can fluctuate considerably depending on market conditions.
Shorting YU against that exposure lets you receive a fixed rate while offsetting the floating component, effectively locking in the funding portion of your carry.
You can also trade funding spreads between venues, opening up strategies around relative funding rates rather than just taking a view on a single exchange.
There's another layer of complexity around how these positions are priced and margined.
Even if the realized funding is moving in your favor, changes in implied APR can affect mark-to-market PnL and margin requirements before maturity.
So there's still liquidation risk, even for someone running an otherwise delta-neutral strategy.
It's interesting to see crypto derivatives developing to this level, especially as perp markets become increasingly liquid and institutional trading strategies become more common onchain.
I'd expect funding-rate markets to become more relevant for market makers, basis desks and funds looking to manage their carry exposure more precisely.
this is awesome!
1/ Just Launched The Rise Awards, an awards event celebrating top talent across roles (designers, PMs, + 13 others)
Www.riseawards.co
really exciting times ahead though
this new world breaks all your previous beliefs
Does anyone else feel like the next decade we’re going into, everything is just so much more unclear and uncertain compared to earlier. Its like we’ve all our lives have played this video game that we got really good at, with «fixed rules», but now it feels like we have to start over again. No career feels safe, no investment method feels like an easy bet anymore. We are heading into unpaved territoriy thanks to AI. Scary, but it will also bring insane opportunities for those who have their eyes open.
I've always wanted to write more.
A few people have encouraged me to do it over the years, and it's something that's constantly been on my mind. I have plenty of thoughts and ideas I'd like to share, but between work, life and everything else, I always end up putting it off.
And sometimes, even when I do find the time, I sit down to write something and end up spending ages trying to figure out how to put what's in my head into words.
Lately I've been doing something a little different with AI, and it's made the whole process so much easier.
Instead of sitting in front of a blank page, I just start talking.
I'll pick a topic I've been thinking about, open a voice transcription tool and spend 5–10 minutes talking about it.
Just whatever comes to mind. Sometimes I'll go on tangents, repeat myself or completely change direction halfway through.
Then I take that transcription and use AI to help organize everything, remove the repetition, clean up the structure and turn it into something readable. Could be a short post, a longer article or just a few paragraphs.
And the best part is that the thoughts are already yours.
You're just using AI to help turn them into writing, rather than asking it to come up with something for you.
Something that might have taken me an hour to sit down and write can now take 10 minutes of talking and a bit of editing.
I still think there's something special about actually sitting down to write, even with pen and paper.
Writing is a skill, and like any skill, you get better at it the more you practice. I definitely wouldn't want to lose that habit or rely entirely on AI.
But for those moments when you have something on your mind and just want to get it out there, this has been one of the more useful ways I've found to use AI.
André retweeted
Alpenglow is live on Solana mainnet.
Finality now targets ~150 ms, and validators pay 0.8 SOL per epoch to vote.
Here’s what it means for institutions staking SOL.
André retweeted
I’ve been thinking about what happens to DeFi when government debt yields 5-6%.
If you can earn roughly 5% on short-term government bonds, earning 4-5% in DeFi while taking on significantly more risk starts to look fairly unattractive.
If the baseline interest rate in the economy is 5%, then DeFi yields need to start at 5% and offer something additional to compensate for the extra risk. Otherwise, why bother?
I suspect the answer is that DeFi increasingly needs to integrate traditional yield-bearing assets.
By bringing government debt onchain, DeFi can establish a baseline yield that moves with interest rates in the broader economy. Additional DeFi yield can then be layered on top, with the associated risks.
A 5% starting point with the potential to earn 10%+ is a much more compelling proposition.
I think this is why tokenizing RWAs is so important.
Almost 36% of all ETH is now staked. On Solana, it's 69%.
Staking has become a pretty significant part of crypto over the past few years, especially as more institutions start holding these assets and looking for ways to generate yield on top of their positions.
Ethereum reached a record 43.8M ETH staked in Q3, with almost 8M ETH in net inflows during the first nine months of 2026.
That's roughly 6x what we saw during the same period last year.
Naturally, as more ETH gets staked, rewards are shared across a larger pool. Yields have gradually come down from 2.91% in Q1 to 2.63% in Q3.
There's also been quite a bit of change on the infrastructure side.
Following Pectra, Ethereum operators can consolidate multiple validators into larger ones, making it easier and cheaper to manage their operations.
The network now has around 881K active validators, compared with nearly 1.1M previously, while the total ETH staked keeps growing.
Solana is going through its own changes.
Around 440M SOL is currently staked, with gross yields sitting at approximately 6%. Its active validator count has also declined to 659, roughly 30% lower than a year ago.
And I think the validator side of this is particularly interesting as staking becomes a bigger institutional business.
Running validators at scale requires serious infrastructure, capital and operational expertise.
Larger operators can spread those costs across more delegated assets, invest in better technology and compete on commissions while maintaining margins.
We're already seeing staking become increasingly professionalized, with asset managers, custodians and institutions integrating it into their products.
I wouldn't be surprised if the next few years bring a lot more consolidation among staking providers, especially as competition shifts toward performance, reliability and operational efficiency.
Source: @Bitwise Q4 2026 Staking Report.
