WEBVTT 1 00:00:00.120 --> 00:00:03.240 So I honestly, I think the ETFs have been a smash hit, like 2 00:00:03.359 --> 00:00:06.960 much more and more activity than we expected. And the main, like I 3 00:00:07.000 --> 00:00:10.000 said to sum it up, the main cohort we think is the net new 4 00:00:10.599 --> 00:00:22.039 user of this ETF is not even in the game yet. This content is 5 00:00:22.039 --> 00:00:25.679 brought to you by v chain, which is a leading enterprise grade Layer one 6 00:00:25.719 --> 00:00:32.479 public blockchain spearheading a digital revolution from a sustainable, highly scalable smart contract platform. 7 00:00:32.759 --> 00:00:37.280 The v chain blockchain has many unique features, which makes it an ideal 8 00:00:37.399 --> 00:00:42.280 choice for Web three applications. V chain is working with many great enterprises such 9 00:00:42.280 --> 00:00:47.759 as PWCGVONCI, BMW, and Walmart China. Most recently, they partnered with 10 00:00:47.840 --> 00:00:55.119 the Boston Consulting Group to build a revolutionary decentralized application ecosystem. I'm a big 11 00:00:55.159 --> 00:00:58.640 believer in this project. I have been since twenty eighteen. I've been a 12 00:00:58.719 --> 00:01:03.799 VET token holder for years, and this blockchain is highly scalable, great with 13 00:01:03.880 --> 00:01:07.599 security and speed, and it has low energy consumption. If you'd like to 14 00:01:07.680 --> 00:01:11.640 learn more about v chain, please visit vchain dot org. Link will be 15 00:01:11.680 --> 00:01:17.519 in a description. Welcome to the Thinking Crypto podcast. You're home for cryptocurrency 16 00:01:17.599 --> 00:01:21.319 news and interviews with me. Today's Alex Thorne, who's the head of firm 17 00:01:21.359 --> 00:01:26.000 wide research at Galaxy. Alex is great to have you on, Yeah, 18 00:01:26.040 --> 00:01:30.400 Tony, great to be here, Alex. I've of course followed Galaxy for 19 00:01:30.439 --> 00:01:34.879 a long time. Mike novograts as well. I think Mike is well known, 20 00:01:34.239 --> 00:01:38.439 and I've always been curious as to what Galaxy is doing behind the scenes. 21 00:01:38.439 --> 00:01:41.959 So I'm very excited to talk to you about what you guys are seeing 22 00:01:41.959 --> 00:01:44.719 in the market, what you're investing in it much more. But let's start 23 00:01:44.719 --> 00:01:48.000 with your background. Where are you from and where'd you grow up. I'm 24 00:01:48.040 --> 00:01:52.159 from Northern Massachusetts. I grew up there. I went to high school there. 25 00:01:52.159 --> 00:01:55.959 I went to college at Vanderbilt University in Nashville, Tennessee. Worked at 26 00:01:55.959 --> 00:02:02.159 Fidelity Investments for twelve years before joining Galaxy in twenty twenty one. In reverse 27 00:02:02.280 --> 00:02:07.359 order. At Fidelity, I ran co ran Avon Ventures, which is Fidelity's 28 00:02:07.680 --> 00:02:13.520 affiliated crypto venture capital arm which we started, and it was director of blockchain 29 00:02:13.560 --> 00:02:16.759 research at Fidelity before that, and then had a whole prior career of legal 30 00:02:16.759 --> 00:02:23.400 and compliance roles before that. But yeah, and you know, been at 31 00:02:23.400 --> 00:02:28.039 galaxy now for over three years. It's been a pretty fun ride. What 32 00:02:28.159 --> 00:02:32.199 was your first encounter with bitcoin and what was your aha moment? So in 33 00:02:32.240 --> 00:02:38.479 one of my early roles, sort of at the relative top of one of 34 00:02:38.479 --> 00:02:44.840 my first careers at Fidelity, effectively, I was basically a senior forensic investigator 35 00:02:44.919 --> 00:02:50.680 at Fidelity Legal, which involves a lot of a lot of database management and 36 00:02:50.680 --> 00:02:55.759 evidence collection, but we're talking about computer evidence, but also occasionally like rypt 37 00:02:55.759 --> 00:03:00.400 decryption, right, finding stuff people don't want you to find. I was 38 00:03:00.439 --> 00:03:04.800 a hobbyist in I'm not a computer scientist by trade. I mean I studied 39 00:03:04.800 --> 00:03:08.439 political science, but I was a you know, a hacker by by hobby, 40 00:03:08.520 --> 00:03:14.039 meaning that I learned on computers by breaking things basically, you know, 41 00:03:14.680 --> 00:03:19.000 And so I was really interested in network kindetration and encryption technologies. I was 42 00:03:19.039 --> 00:03:23.759 involved strutting a tour exit node in like two thousand and nine, and at 43 00:03:23.759 --> 00:03:29.439 some point I was in some IRC chats about like the Hacker Collective anonymous or 44 00:03:29.560 --> 00:03:32.479 uh tour running tour exit nodes and stuff, and in like twenty twelve or 45 00:03:32.520 --> 00:03:36.479 so, and people were like, have you seen this bitcoin thing? And 46 00:03:36.520 --> 00:03:38.479 I was like, I have no idea what that is, and then I 47 00:03:38.520 --> 00:03:42.080 was like, wow, this is pretty cool. It's digital money, it's 48 00:03:42.199 --> 00:03:44.960 encryption money. It's kind of how I thought of it. And then there 49 00:03:44.960 --> 00:03:50.039 were activists during in the Euromy Dawn protest in Ukraine. I mean, things 50 00:03:50.039 --> 00:03:54.039 of things really come full circle that were soliciting donations in bitcoin. I was 51 00:03:54.080 --> 00:03:57.319 like, what is this thing? And so I got interested in it, 52 00:03:57.400 --> 00:04:01.199 then kind of stopped caring, and then in twenty fifteen, really Fidelity started 53 00:04:01.199 --> 00:04:03.639 getting interested in it, and I was sort of identified as one of the 54 00:04:04.159 --> 00:04:06.840 people who knew about it, and so I started working with them, and 55 00:04:06.879 --> 00:04:10.080 then I was like, I have to I have to really go down the 56 00:04:10.120 --> 00:04:13.199 rabbit hole. Really became a true believer, probably in like twenty fifteen or 57 00:04:13.240 --> 00:04:17.040 so. I've later learned that my now friend Alex Gladstein, the chief strategy 58 00:04:17.079 --> 00:04:21.360 officer at the Human Rights Foundation, is the one who was helping euro Maydon 59 00:04:21.560 --> 00:04:27.120 protesters use back, which is one of the first thing ways I learned about 60 00:04:27.160 --> 00:04:30.560 it. So things are It's been a while, but I've been working on 61 00:04:30.600 --> 00:04:35.000 it full time, probably since like sixteen seventeen in one capacity or another. 62 00:04:35.439 --> 00:04:41.079 That's amazing. Let's talk a little bit about Fidelity, Because what's what fascinates 63 00:04:41.079 --> 00:04:44.920 me is that fidel who is very early out of all the big institutions in 64 00:04:45.000 --> 00:04:47.959 Wall Street. And I give him a lot of credit for that that they 65 00:04:48.000 --> 00:04:53.360 were thinking outside the box. They were ahead of the curve. Now everybody's 66 00:04:53.399 --> 00:04:57.879 here and ETFs and all these things are live. But what do you think 67 00:04:57.920 --> 00:05:00.160 is it just their DNA, you know, as opposed to let's say a 68 00:05:00.240 --> 00:05:03.439 Vanguard, which is like, we don't want to list any bitcoin etiaus. 69 00:05:03.639 --> 00:05:06.360 But Fideliti's like, let's explore this, let's take a look at this. 70 00:05:08.079 --> 00:05:11.680 Yeah it is, And I would say it's in the DNA of Fidelity leadership 71 00:05:11.720 --> 00:05:15.360 and ownership. So I chuckle. Because they are commonly thought of a so 72 00:05:15.439 --> 00:05:16.920 Wall Street firm, they would take umbrage at that. They're not on Wall 73 00:05:16.920 --> 00:05:19.720 Street at all. They're on Summer Street in Boston. This is a Boston 74 00:05:19.759 --> 00:05:24.759 headquartered company, not a New York headquarter company. And that actually goes back 75 00:05:24.800 --> 00:05:27.720 to it, like if you think about the two cities, like Boston has 76 00:05:27.759 --> 00:05:33.240 this really like sort of more old school Pilgrim, you know, sort of 77 00:05:33.600 --> 00:05:36.759 New England. I mean New Englanders are different than New Yorkers, and they 78 00:05:36.759 --> 00:05:42.360 have a more sort of buttoned up, kind of polite and not that anyone's 79 00:05:42.360 --> 00:05:46.560 impolite, but sort of a more polite New Englander vibe, and that does 80 00:05:46.720 --> 00:05:50.079 pervade I would say at Fidelity, it's it's not a Wall Street culture there 81 00:05:50.079 --> 00:05:54.360 in the scheme of things. And by the way, they're mostly an asset 82 00:05:54.360 --> 00:05:57.759 manager and brokerage firm, right, so they don't create like bespoke finding. 83 00:05:57.800 --> 00:06:00.000 They're not an investment bank. They're not a bank at all, right, 84 00:06:00.120 --> 00:06:03.120 so there's some distinction. But Fidelity also another thing people don't know is that 85 00:06:03.160 --> 00:06:06.759 it's a privately owned company. It is not a publicly traded company. It 86 00:06:06.839 --> 00:06:13.120 is owned majority by current chairman and CEO Abigail Johnson, who is the granddaughter 87 00:06:13.240 --> 00:06:17.519 of the founder Edward Johnson right and his son Ned. Her dad ran the 88 00:06:17.519 --> 00:06:24.600 company for thirty plus years and he was, among other many things, famous 89 00:06:24.639 --> 00:06:28.519 for technology innovation. I forget all of the lauda Tory benchmarks here, but 90 00:06:28.560 --> 00:06:31.439 like Fidelity was the first company to have check writing on a brokerage account, 91 00:06:31.480 --> 00:06:35.680 they were the first person to have first asset manager in brokerage firm to have 92 00:06:35.680 --> 00:06:39.480 a website, and they were the first ones to have a one eight hundred 93 00:06:39.600 --> 00:06:45.519 number, etc. Right, and they devote a significant portion of annual spend 94 00:06:46.240 --> 00:06:48.759 into technology innovation. When I was director of blockchain research there, that was 95 00:06:48.759 --> 00:06:55.560 specifically in a centralized innovation department called the Fidelity Center for Applied Technology, which 96 00:06:55.600 --> 00:06:59.560 I used to joke was Ned Johnson's bat cave. Like it's literally the other 97 00:06:59.600 --> 00:07:03.120 teams there when I was working on it in seventeen and eighteen, there were 98 00:07:03.160 --> 00:07:06.639 like AI, machine learning, like VR, right, like that that's what 99 00:07:06.720 --> 00:07:12.319 people were working on in that group, and blockchain and so you know, 100 00:07:12.519 --> 00:07:17.279 so the story goes Abby again, the granddaughter of the founder of Fidelity and 101 00:07:17.360 --> 00:07:21.839 the current CEO and chairman of the board. And I think, as far 102 00:07:21.879 --> 00:07:25.439 as i'm aware of, the majority owner of the company, so like I 103 00:07:25.480 --> 00:07:29.800 said, it's a family owned company. Still, she became specifically interested in 104 00:07:29.800 --> 00:07:33.439 bitcoin herself, right, And so unlike many places where in particularly in traditional 105 00:07:33.480 --> 00:07:38.639 finance or in big companies, where bitcoin was pitched up by a junior employee 106 00:07:38.680 --> 00:07:42.439 or a middle level employee saying, oh my god, like you go check 107 00:07:42.439 --> 00:07:44.759 this thing out, and it's like hard to twist the arms of the higher 108 00:07:44.839 --> 00:07:46.839 ups or the older folks there to get them to do it. This is 109 00:07:46.879 --> 00:07:50.879 actually the exact opposite. This came down from Abby and some people were assigned 110 00:07:50.920 --> 00:07:55.600 to look into it, and some of those people found me as a resource 111 00:07:55.759 --> 00:07:59.160 when I was in the legal group at Fidelity, right, and so like 112 00:07:59.600 --> 00:08:03.360 this is a whole different way and that I mean frankly, that's why they're 113 00:08:03.360 --> 00:08:05.959 so far ahead. And then when we when I was working on it there, 114 00:08:07.199 --> 00:08:09.360 you know, we were looking at all different types of use cases for 115 00:08:09.399 --> 00:08:13.519 blockchain literally like the most vanilla private blockchain ideas as well like can we use 116 00:08:13.519 --> 00:08:18.120 this to share like trade reporting with with FINRA, the right the securities self 117 00:08:18.160 --> 00:08:22.519 regulatory organization, Can we like I don't know, like do like a private 118 00:08:22.600 --> 00:08:26.560 blockchain with the other brokerage firms, to like do like KYC with things or 119 00:08:26.560 --> 00:08:31.720 something who knows? Right? Like all that we did enterprise use cases that 120 00:08:31.759 --> 00:08:33.480 were relevant for our business, not like you know, we weren't trying to 121 00:08:33.480 --> 00:08:37.519 put tomatoes on the blockchain like IBM and some others, because that has totally 122 00:08:37.519 --> 00:08:41.879 irrelevant to Fidelities business. But we looked at so many of these and and 123 00:08:41.919 --> 00:08:45.720 I won't do the whole rant on why, but ultimately we were like, 124 00:08:45.759 --> 00:08:50.799 no, really the market need is bitcoin institutional custody like And of course we 125 00:08:50.919 --> 00:08:52.799 liked bitcoin a lot. I mean, it wasn't like we went only into 126 00:08:52.799 --> 00:08:58.720 into enterprise blockchain, but that was one of the sort of paths we went 127 00:08:58.840 --> 00:09:01.159 down, was like, can we use it for anything else? And we 128 00:09:01.159 --> 00:09:05.440 were like not maybe one day, but actually the real opportunity is in bitcoin. 129 00:09:05.840 --> 00:09:09.200 And so that's why the efforts were put forth to build what is now 130 00:09:09.240 --> 00:09:13.240 Fidelity Digital Assets, which was really a bitcoin custody product that was built and 131 00:09:13.519 --> 00:09:20.159 initially in the blockchain incubator inside Fidelity Center for Plid Technology. And obviously they've 132 00:09:20.200 --> 00:09:22.080 come a long way since then. So it is, as a long answer 133 00:09:22.120 --> 00:09:26.240 to your question, Tony, it is in their DNA. But it's not 134 00:09:26.440 --> 00:09:30.759 just the company culture. That culture pervades down from the top, and the 135 00:09:30.799 --> 00:09:33.720 fact that it's private means they have a lot more leeway to do things like 136 00:09:33.799 --> 00:09:39.000 spend a ton of money on innovation, right and like get these these you 137 00:09:39.039 --> 00:09:41.320 know, almost like a SpaceX. Like SpaceX people are like, oh my 138 00:09:41.320 --> 00:09:43.279 god, they blew up so many rockets. Well, it's like, yeah, 139 00:09:43.279 --> 00:09:46.960 they're a private company. They weren't afraid to blow up all those prockets. 140 00:09:46.960 --> 00:09:48.840 That's why they're up in space first, you know, same thing. 141 00:09:50.360 --> 00:09:52.080 Yeah, No, that's great insight, man. And to your point, 142 00:09:52.200 --> 00:09:56.080 coming from the top down from Abigail, that's amazing and just shows the mindset 143 00:09:56.159 --> 00:10:01.519 and that they are for thinkers that that's pretty awesome. Yeah. Now, 144 00:10:01.759 --> 00:10:05.679 tell us about Galaxy for those who don't know about Galaxy, tell us about 145 00:10:05.759 --> 00:10:09.879 Galaxy and the services and all the different things you guys do. Yeah. 146 00:10:09.879 --> 00:10:15.120 So Galaxy is i'd venture to say, one of the biggest multi service financial 147 00:10:15.159 --> 00:10:20.000 companies in all of crypto. A lot has changed over the last few years, 148 00:10:20.000 --> 00:10:22.639 but we're calling and I don't just mean a galaxy, I mean in 149 00:10:22.720 --> 00:10:26.200 the market and in the market infrastructure. But given some of what's going on 150 00:10:26.320 --> 00:10:30.840 going what has gone on over the last two years or so, I would 151 00:10:30.919 --> 00:10:37.000 venture to guess that now we're probably the biggest in OTC spot and derivatives trading. 152 00:10:37.480 --> 00:10:39.679 We're one of the biggest asset managers in all of crypto, I think 153 00:10:39.720 --> 00:10:46.039 I technically I think second behind Gray Skill in AUM. Wow. So we 154 00:10:46.080 --> 00:10:50.240 have an asset management business that manages private funds, active strategies like venture and 155 00:10:50.279 --> 00:10:54.559 hedge fund type strategies. Literally that take and manage money for external clients, 156 00:10:56.799 --> 00:11:01.279 also passive vehicles. Obviously, we're a sub advisor to the Invesco Galaxy Bitcoin 157 00:11:01.320 --> 00:11:05.440 ETF so and we are similarly have ETFs like that in both Canada and Brazil. 158 00:11:07.480 --> 00:11:11.000 And that business has also announced a big partnership with DWUS, which is 159 00:11:11.039 --> 00:11:13.320 Deutsge Wealth Services in Europe, which I think is the largest, if not 160 00:11:13.559 --> 00:11:16.440 it's one of the largest, of not the largest asset manager in Europe. 161 00:11:18.279 --> 00:11:22.159 So asset management. Then obviously, like I said, trading, so we 162 00:11:22.240 --> 00:11:26.720 run a big OTC trading business that's spot, derivatives lending, electronic trading, 163 00:11:26.799 --> 00:11:31.720 a variety of services like that, right. So this is again both of 164 00:11:31.759 --> 00:11:35.200 these that I would say are the sort of two bigggest businesses at Galaxy are 165 00:11:35.320 --> 00:11:39.600 This is institutional only like right, we don't retail traders can't interact with us 166 00:11:39.600 --> 00:11:43.120 directly, right, But we also have a big venture operation which is part 167 00:11:43.120 --> 00:11:48.039 of that asset manager. We have an advisory business so I think like investment 168 00:11:48.080 --> 00:11:50.120 banking, right, they advise companies and startups, right, So that could 169 00:11:50.120 --> 00:11:56.639 include on raising capital or transactions, acquisitions, mergers, even going on public 170 00:11:58.120 --> 00:12:01.279 And then of course we have a pretty big, big coined mining team. 171 00:12:01.519 --> 00:12:05.799 So and business so both proprietary mining, hosting, a variety of other things, 172 00:12:05.840 --> 00:12:09.799 financing for miners. So it's a it's a it's a multi it's a 173 00:12:09.879 --> 00:12:13.519 multi services company. And you know, I mean, obviously Mike Novogratz is 174 00:12:13.519 --> 00:12:18.200 our founder and CEO. He's been in the market for a long time and 175 00:12:18.200 --> 00:12:24.200 and you know, provides a really long history of knowing how crypto works. 176 00:12:24.240 --> 00:12:30.639 And he himself is a long time you know trader and and macro trader, 177 00:12:30.639 --> 00:12:33.080 well known macro trader. So it's it's in general, it's an exciting thing. 178 00:12:33.120 --> 00:12:37.240 Just briefly, on the research side, Like so, we have all 179 00:12:37.279 --> 00:12:41.240 these businesses, so there's internal needs for insights and research into the markets, 180 00:12:41.320 --> 00:12:46.879 the competition, the opportunities, the new technologies. We provide plenty of that 181 00:12:46.960 --> 00:12:50.039 internally. We also obviously publish publicly and can read all of that at Galaxy 182 00:12:50.080 --> 00:12:56.279 dot com slash slash Research. We also publish privately to counters and counterparties and 183 00:12:56.639 --> 00:13:03.159 clients right notes, alerts, ideas is so. And I've actually recently I 184 00:13:03.200 --> 00:13:07.399 didn't do it today on Wednesday, but the last several wednesdays, I've actually 185 00:13:07.440 --> 00:13:11.320 tweeted the private notes that we've sent, sort of like open source that tweeted 186 00:13:11.360 --> 00:13:18.039 them publicly. So yeah, we write and produce insights for internal and external 187 00:13:18.039 --> 00:13:20.279 clients a sort of the way of saying it. But it's it's reports, 188 00:13:20.279 --> 00:13:26.679 it's podcasts, it's alerts and white papers and stuff like that. So wow, 189 00:13:26.840 --> 00:13:31.720 I mean you're running a full gambit here as far as all services that 190 00:13:31.759 --> 00:13:37.320 are needed in crypto from an investment standpoint, that's a lot of business services 191 00:13:37.320 --> 00:13:41.960 and farms that you have question for you From the OTC side, you know, 192 00:13:43.000 --> 00:13:46.960 with these bitcoin ETFs getting approved, have you seen a surge in demand 193 00:13:46.039 --> 00:13:50.240 for bitcoin? Uh, maybe some of the issuers looking to grab up as 194 00:13:50.279 --> 00:13:54.960 much bitcoin from you guys. Yeah, So we we do provide liquidity for 195 00:13:56.360 --> 00:14:01.360 like market participants across the gamut, including you know, market access vehicles, 196 00:14:01.440 --> 00:14:07.639 but also hedge funds, traditional or crypto focused high net worth individuals, and 197 00:14:07.679 --> 00:14:11.000 other types of institutional traders. So and I would say, like on the 198 00:14:11.080 --> 00:14:15.759 on the ETF side, in general, there is huge demand for bitcoin. 199 00:14:15.960 --> 00:14:18.960 It's very visible in many ways. You don't have to rely on me telling 200 00:14:20.000 --> 00:14:22.960 you about our desk flows. You can see it in the Bloomberg's you know 201 00:14:22.200 --> 00:14:26.200 data, it's very obvious, like something like over a billion dollar net inflow 202 00:14:26.320 --> 00:14:31.639 yesterday on UH I guess which March twelfth, which is the largest day ever 203 00:14:31.840 --> 00:14:37.039 in bitcoin ETF history, almost double the prior margest day, which is crazy. 204 00:14:37.960 --> 00:14:41.600 I would say broadly, in terms of flows that we see on our 205 00:14:41.639 --> 00:14:43.559 desk, there absolutely has been a heightened interest. But it's not just in 206 00:14:43.600 --> 00:14:48.240 the last couple of months. Like a lot of the rally that we saw 207 00:14:48.279 --> 00:14:54.639 from say early October to present was also driven by smart traders and at institutional 208 00:14:54.679 --> 00:14:58.240 traders becoming long bitcoin and coming back into the cold like last year. I 209 00:14:58.279 --> 00:15:00.960 said, at one point I was on Bloomberg TV and they said, like, 210 00:15:01.039 --> 00:15:03.159 what's I think we were getting to twenty five k. It's like maybe 211 00:15:03.200 --> 00:15:07.679 like right around the Silicon Valley bank collapse or right before that, which was 212 00:15:07.840 --> 00:15:11.840 you know, a nice rally off of the sixteen to five bitcoin price to 213 00:15:11.879 --> 00:15:15.720 start last year. I mean, twenty five k from sixteen five is a 214 00:15:16.080 --> 00:15:20.759 you know, it's like almost a fifty percent increase, so, or it 215 00:15:20.840 --> 00:15:24.639 is a fifty percent increase basically. So, And I said at that point 216 00:15:24.639 --> 00:15:26.960 they asked me the same question, like you know, what's the level of 217 00:15:26.039 --> 00:15:28.879 institutional interest. I'm like, well, we're seeing you know, some of 218 00:15:28.919 --> 00:15:35.559 the early you know diehards that our institutional were coming back, but you know, 219 00:15:35.240 --> 00:15:39.559 some are starting they've already been back. But the most we're seeing sum 220 00:15:39.600 --> 00:15:41.840 are starting to pick up the phone. Right, They're starting to be like, 221 00:15:41.879 --> 00:15:43.320 wait, so I got fifty percent, maybe I should like check in 222 00:15:43.360 --> 00:15:48.039 with Galaxy, you know, after they went dark for like a year and 223 00:15:48.080 --> 00:15:50.639 then and I said at the time, at thirty K, they're going to 224 00:15:50.679 --> 00:15:52.919 be, you know, knocking on the door, and at thirty five K, 225 00:15:52.960 --> 00:15:54.799 they're going to be banging the door down. Like that's exactly what ended 226 00:15:54.840 --> 00:15:58.679 up happening last fall. Like once we crossed like thirty K, it started 227 00:15:58.679 --> 00:16:03.840 to be like wait a second, like we really should be do we still 228 00:16:03.840 --> 00:16:06.840 have the trading agreement live with Galaxy? Like questions like that right, and 229 00:16:06.879 --> 00:16:08.279 we're like, yeah, you do. You should be buying bitcoin right now. 230 00:16:08.320 --> 00:16:11.000 Like, by the way, we've been saying that for a year, 231 00:16:11.120 --> 00:16:12.600 so like, you know, we're trying to help you, you know, 232 00:16:12.759 --> 00:16:15.039 I mean, we don't give financial advice, but it's you know, I 233 00:16:15.080 --> 00:16:18.840 write content that's like at sixteen five, this could be like a generational buying 234 00:16:18.879 --> 00:16:25.279 opportunities what I'm selling the public even so, and it's it's really just remained 235 00:16:25.360 --> 00:16:30.080 consistent and accelerated I would say since pretty much since October. And yeah, 236 00:16:30.120 --> 00:16:33.320 so we see plenty of interest. I mean, it's it's not this is 237 00:16:33.360 --> 00:16:38.320 not some people missed it still, which is just crazy to me because I 238 00:16:38.360 --> 00:16:41.440 don't know, They're like, well, you should have just said to buy. 239 00:16:41.480 --> 00:16:44.200 I'm like, do you follow any people that work in bitcoin? Like, 240 00:16:44.639 --> 00:16:47.320 first of all, maybe that's the problem. We tell you to buy 241 00:16:47.360 --> 00:16:49.559 all the time. I'm you know, Michael Saylor says he'll be forever buying 242 00:16:49.600 --> 00:16:52.600 the top Like, so maybe it's not like signal then if he's always buying. 243 00:16:53.440 --> 00:16:56.679 But yeah, we are seeing strong interest. The ETFs are seeing strong 244 00:16:56.720 --> 00:17:02.559 interest, like the flows, I mean the frankly, the whole market's infrastructure 245 00:17:02.639 --> 00:17:08.279 and structure is going to evolve like this. This ETF complex in the US 246 00:17:08.400 --> 00:17:14.400 is smashing against the traditional architecture and it's going to change both. It is 247 00:17:14.839 --> 00:17:19.319 going to You're going to see increasing volumes on US exchanges and from increasing share 248 00:17:19.319 --> 00:17:25.920 of bitcoin trading volume on US exchanges and in US OTC VERSUS S a like 249 00:17:26.000 --> 00:17:30.400 Binance, which has had been the leader for so long. You're already seeing 250 00:17:30.880 --> 00:17:36.680 like CME futures are like the dominant, the biggest venue now for bitcoin futures 251 00:17:36.720 --> 00:17:41.599 trading, and you're going to see probably, I mean, these ETFs suck 252 00:17:41.680 --> 00:17:44.359 up like maybe like twenty percent of the bitcoin over time. I mean, 253 00:17:44.599 --> 00:17:47.000 I don't think like all of it, but like it's they're going to be 254 00:17:47.119 --> 00:17:51.920 massive parts of bitcoin. And we're just just at the beginning of that. 255 00:17:52.039 --> 00:17:55.079 So there's I think more change to come. Yeah, to your point, 256 00:17:55.400 --> 00:17:59.119 just at the beginning. And we know there's a campaign right now to educate 257 00:17:59.160 --> 00:18:03.720 the ri as wealth managers, get all these folks familiar. How does this 258 00:18:03.799 --> 00:18:06.839 work? What is bitcoin? You know? Because in the past they couldn't 259 00:18:06.880 --> 00:18:10.839 touch it even if they were interested in it. So do you expect like 260 00:18:11.119 --> 00:18:15.160 the flows to ramp up into the end of the year or maybe to the 261 00:18:15.160 --> 00:18:18.799 peak of this cycle, maybe then it slows down a bit. Yeah, 262 00:18:18.839 --> 00:18:22.480 I don't know. Yes, I think the simple answer is yes. But 263 00:18:22.640 --> 00:18:26.519 I think it is true that the we've argued for all we had a paper 264 00:18:26.519 --> 00:18:29.400 in October where we made predictions about like the amount of inflows, which, 265 00:18:29.440 --> 00:18:33.960 by the way, We only looked at the wealth management and financial advisor market 266 00:18:33.000 --> 00:18:37.119 in the US, which is a forty eight trillion dollar AUM market, so 267 00:18:37.160 --> 00:18:42.160 it's huge, and we said fourteen point five billion net inflows from that cohort 268 00:18:42.160 --> 00:18:45.440 in year one. Well, I mean we're basically at that without that core 269 00:18:45.559 --> 00:18:49.680 or having even really turned on yet, so our prediction, of course will 270 00:18:49.720 --> 00:18:53.319 become in low. We said it was conservative, and we didn't even bother 271 00:18:53.359 --> 00:18:57.440 accounting for retail, like for non advisor money, which we think basically all 272 00:18:57.480 --> 00:19:02.680 of this is because really none of the major platforms have turned on yet. 273 00:19:02.720 --> 00:19:06.599 You've seen some independent RaaS that have said they're allowing it. Well, that's 274 00:19:06.640 --> 00:19:11.480 pretty easy if you're small. The real prize is the forty trillion that's you 275 00:19:11.519 --> 00:19:15.279 know, managed by advisors who are affiliated with banks or broker dealers. Right, 276 00:19:15.359 --> 00:19:18.720 the big you know, the Morgan Stanley's and Merrill Lynches and et cetera. 277 00:19:18.880 --> 00:19:23.359 Right, that's that's the huge amount of capital that hasn't really had any 278 00:19:23.440 --> 00:19:30.920 way to even put any allocation into bitcoin exposure. Period. They don't They 279 00:19:30.960 --> 00:19:33.640 didn't have the cash settled futures ETFs, they did not have access to the 280 00:19:33.680 --> 00:19:41.079 closed end trusts, they a couple of them had access to like private bitcoin 281 00:19:41.200 --> 00:19:44.960 vehicles like the Galaxy Bitcoin Fund right, which is like but again that that 282 00:19:45.279 --> 00:19:48.720 just a few of the platforms and usually that was quite limited to like okay, 283 00:19:48.720 --> 00:19:52.160 only if like you're super high net worth client like complains enough, then 284 00:19:52.200 --> 00:19:56.000 will allow type of stuff. Usually, So that's the the net new addressable 285 00:19:56.039 --> 00:19:59.599 market. And as far as I know, they are not really on yet. 286 00:20:00.559 --> 00:20:03.799 Some of them are getting ready to turn on on their brokerage platform. 287 00:20:03.839 --> 00:20:07.079 But that's that's just because they're seeing I think, well it's inevitable, but 288 00:20:07.119 --> 00:20:10.359 that's also because they're seeing like what Fidelity is doing. Keep in mind, 289 00:20:10.400 --> 00:20:12.680 Fidelity is like one of the biggest brokerage platform providers. Like you can go 290 00:20:12.720 --> 00:20:18.519 open a stock trading account forget whether you're you know, an advisor. They 291 00:20:18.519 --> 00:20:22.200 also have a big that they have a huge asset manager. Among the other 292 00:20:22.240 --> 00:20:26.319 things they issue that their bitcoin tf They also have this giant distribution platform which 293 00:20:26.359 --> 00:20:32.240 is the four oh one k's the iras the right the brokerage accounts. So 294 00:20:32.359 --> 00:20:36.559 like I think you're going to see the platforms turn on and then when the 295 00:20:36.720 --> 00:20:45.200 advisors are authorized, let alone able to pitch bitcoin exposure to their end clients' 296 00:20:45.799 --> 00:20:48.279 that's the big prize. I don't think we've seen any of them turn on 297 00:20:48.400 --> 00:20:51.079 yet. Really, I think so you're going to see a constant drip of 298 00:20:51.200 --> 00:20:55.119 headlines over the next you know, three to eighteen months of these turning on 299 00:20:55.279 --> 00:20:59.880 or not turning on, and those headlines will be bullish and then actually the 300 00:21:00.119 --> 00:21:03.599 thing will be bullish because the headline isn't just a news event, it's it's 301 00:21:03.640 --> 00:21:07.480 a it's a flows event. So and and yeah, so I I think 302 00:21:08.839 --> 00:21:14.119 I don't I'm not prepared to say it. The flows will accelerate. They 303 00:21:14.440 --> 00:21:18.920 they they should continue. I mean, I frankly like they've been accelerating even 304 00:21:19.079 --> 00:21:22.279 without these guys. So I honestly, I think the ETFs have been a 305 00:21:22.319 --> 00:21:26.640 smash hit, like much much more activity than we expected. And the main 306 00:21:26.799 --> 00:21:30.319 like I said, to sum it up, the main cohort we think is 307 00:21:30.400 --> 00:21:33.279 the net new user of this ETF is not even in the game yet. 308 00:21:33.680 --> 00:21:37.440 M yeah. Absolutely. Now I'm curious what type of clients you work with. 309 00:21:37.599 --> 00:21:41.480 I know there's family offices, hedge funds, pensions. Can you I 310 00:21:41.519 --> 00:21:44.559 don't know if you can name drop, but if not, it could give 311 00:21:44.599 --> 00:21:48.519 us the category that they fall in. Yeah, I mean it's it's all 312 00:21:48.559 --> 00:21:52.920 of the ones that you said. It's it's you know, pensions, pension 313 00:21:52.000 --> 00:21:59.000 funds, endowments, big pools of capital basically that have the capability first of 314 00:21:59.039 --> 00:22:02.920 all, that have the capable ability of dealing directly, right and you set 315 00:22:02.960 --> 00:22:06.720 to sign like legal documents. Is one thing that one point about the ETFs 316 00:22:06.880 --> 00:22:10.559 is like, well, the biggest investor, like an endowment, they can 317 00:22:10.640 --> 00:22:14.519 go and sign a private placement agreement and get some exposure into a private bitcoin 318 00:22:14.559 --> 00:22:17.359 fund, like they have the bandwidth and the lawyers to do that, right. 319 00:22:17.960 --> 00:22:22.440 And the smallest retail person that we can open an account on a coin 320 00:22:22.519 --> 00:22:25.640 base or cash app or something right like, we can also do it. 321 00:22:25.920 --> 00:22:27.640 It's the middle where it's like wait a second, I have one hundred end 322 00:22:27.759 --> 00:22:32.559 clients. None of these platforms offer sub accounts. I can't go and negotiate 323 00:22:32.640 --> 00:22:37.480 a PPA for every client with every bitcoin right like that That's why that middle 324 00:22:37.559 --> 00:22:41.519 cohort of the advisor managed accounts really hasn't had access. So but yes, 325 00:22:41.559 --> 00:22:45.720 I would say, you know, Wales, high net worth family offices, 326 00:22:45.880 --> 00:22:49.799 hedge funds, I mean, and I mean like there's hundreds of crypto hedge 327 00:22:49.839 --> 00:22:55.400 funds, liquid crypto funds, but also the traditional Wall Street macro funds and 328 00:22:55.599 --> 00:22:57.480 trade. They all trade, I mean not all, but like basically they 329 00:22:57.480 --> 00:23:02.640 all trade bitcoin. They either have exposure or they put it on or take 330 00:23:02.680 --> 00:23:04.319 it off, or they trade it. And this is why when we say, 331 00:23:04.400 --> 00:23:07.200 like or when Novo goes on TV and says, the bitcoin is becoming 332 00:23:07.319 --> 00:23:11.200 or has become a macro asset, like that's what he's talking about, the 333 00:23:11.240 --> 00:23:18.880 world's largest macro traders. They don't just have like rates FX, gold oil, 334 00:23:18.519 --> 00:23:22.599 they also now Bitcoin sitting there on their screen every day. So and 335 00:23:22.720 --> 00:23:26.640 by the way, as they should, because this is a this is like 336 00:23:26.759 --> 00:23:30.119 gold, except you can actually use it. It's actually global, right, 337 00:23:30.279 --> 00:23:33.759 so I mean there's no value in my mind and trading gold, like if 338 00:23:33.839 --> 00:23:37.279 two sovereigns want to trade gold and there's just some guy with a rickety cart 339 00:23:37.400 --> 00:23:41.960 underneath the New York Fed like moving one gold bar from one cage to another, 340 00:23:41.960 --> 00:23:44.640 because that's like a lot of it is, right, Like this is 341 00:23:44.720 --> 00:23:49.680 a liquid, global, scarce decentralized store of value that people are finally understanding 342 00:23:49.720 --> 00:23:53.720 how it works. And so that that's some idea of the cohorts, but 343 00:23:53.759 --> 00:24:00.359 again no direct typically on the trading or asset management side interaction with I would 344 00:24:00.359 --> 00:24:03.559 say, also like crypto market participants, right, we have businesses that do 345 00:24:03.680 --> 00:24:10.240 stuff with protocols and and and you know whatever. They're called foundations Dow's theoretically 346 00:24:10.440 --> 00:24:14.400 right. Miners, right, we are mining business. We may host for 347 00:24:14.519 --> 00:24:18.279 other miners. We may lend two miners, right, and do minor financing. 348 00:24:18.400 --> 00:24:22.759 So a wide variety. But not like Alex Thorn right, not like 349 00:24:22.880 --> 00:24:26.640 random, not Tony Edward, not not just like normal individual people typically, 350 00:24:27.400 --> 00:24:30.759 Right, Alex, I'm gonna ask you a question that you probably can't answer. 351 00:24:30.839 --> 00:24:36.160 This. We know the likes of Jamie Diamond is constantly bashing bitcoin. 352 00:24:36.839 --> 00:24:41.920 But can you say yes or no if you know of JP Morgan and those 353 00:24:41.960 --> 00:24:48.119 guys are trading bitcoin. Well, I know that JPM is an authorized participant 354 00:24:48.400 --> 00:24:52.440 in at least I think some of the ETFs. So they are basically helping 355 00:24:52.519 --> 00:24:57.200 create redeem shares. I don't know off the top of my head, but 356 00:24:57.400 --> 00:25:03.400 there are definitely My guess is there are places inside JP that are trading maybe 357 00:25:03.480 --> 00:25:07.079 futures on CME right, Like, So I would say, in general, 358 00:25:07.279 --> 00:25:11.000 like basically every Prime Brokerage is doing something in this space, Like I mean, 359 00:25:11.039 --> 00:25:14.160 they have a big trading business, so I'd be shocked if they weren't 360 00:25:14.480 --> 00:25:19.599 trading the ettfs, trading the futures. I mean that's doesn't require bitcoin wallets 361 00:25:19.680 --> 00:25:25.359 or anything like that to do that, so I think they probably are now. 362 00:25:25.640 --> 00:25:30.079 As far as assets that you guys support obviously bitcoin, do you include 363 00:25:30.160 --> 00:25:33.720 like the top ten to twenty all coins as well and your clients have access 364 00:25:33.799 --> 00:25:37.759 to trade those as well. Hi, everyone part in the interruption. I'm 365 00:25:37.799 --> 00:25:41.279 Tony Edward, the founder and host of the Thinking Crypto podcast. I have 366 00:25:41.359 --> 00:25:45.680 a you favor to ask you. If you haven't subscribed as yet on YouTube 367 00:25:45.759 --> 00:25:48.599 or the podcast platforms, hit the subscribe button, hit the thumbs up button, 368 00:25:48.880 --> 00:25:53.119 hit the notification bell on a YouTube platform and on Spotify or Apple or 369 00:25:53.160 --> 00:25:56.599 wherever you get your podcasts, please leave a five style rating and review. 370 00:25:56.920 --> 00:26:00.759 It supports the podcast. It allows me to great quality content to you. 371 00:26:02.160 --> 00:26:03.799 Thank you for your support, and I'll let you get back to the content. 372 00:26:04.400 --> 00:26:08.400 So with our counter parties, and I make that distinction because on our 373 00:26:08.480 --> 00:26:11.799 trading business, this is over at the counter trading, right, It's not 374 00:26:11.920 --> 00:26:15.720 a fiduciary relationship. For the most part, it's I think maybe at all. 375 00:26:15.640 --> 00:26:19.680 So these are you meet us out in the world and you say, 376 00:26:19.759 --> 00:26:22.079 hey, are you guys selling bitcoin or buying bitcoin? And we're like, 377 00:26:22.119 --> 00:26:25.200 yeah, we're selling it for this much and we're buying it for this much. 378 00:26:25.240 --> 00:26:27.039 Feel free to take it or leave it, right Like, that's sort 379 00:26:27.039 --> 00:26:32.119 of how TC trading works. You know. I don't have the list in 380 00:26:32.160 --> 00:26:33.960 front of me, but it's it's you know, it's most of the top 381 00:26:33.039 --> 00:26:38.319 coins. I think in general, we it matters via jurisdiction, right. 382 00:26:38.359 --> 00:26:44.119 We have a like probably all places, we have a pretty robust compliance review 383 00:26:44.200 --> 00:26:48.039 process to determine if something can or can't be listed, right, and includes 384 00:26:48.119 --> 00:26:52.480 both you know, regulatory and safety questions, right, Like, we're not 385 00:26:52.519 --> 00:26:59.119 going to list a network that can't operate something right or has the risk or 386 00:26:59.160 --> 00:27:03.240 too high, but there are also regulatory questions, right. I don't so, 387 00:27:03.559 --> 00:27:04.599 yeah, but I would say, I mean most of the top coins, 388 00:27:04.680 --> 00:27:07.720 I think, you know, and I look behind you pretty much all 389 00:27:07.720 --> 00:27:10.440 the ones that you have pillows for there. I'm not sure about XRP. 390 00:27:10.640 --> 00:27:12.400 I don't know whether we still trade it. Obviously, at one point the 391 00:27:12.759 --> 00:27:17.759 lawsuit made that with the SEC praise some questions there, and like I said, 392 00:27:17.920 --> 00:27:19.640 I don't have the list in front of me, but basically all of 393 00:27:19.720 --> 00:27:25.680 the top coins that you can mostly think of. So on the venture side, 394 00:27:26.640 --> 00:27:30.519 you guys are probably invested in quite a few companies. Any that stand 395 00:27:30.599 --> 00:27:33.480 out to you or you know what you're looking at it this year. Yeah. 396 00:27:33.559 --> 00:27:37.599 So I'm not on the venture team, but I am on the investment 397 00:27:37.640 --> 00:27:41.279 committee, and I did do crypto vc AD fidelity for several years, so 398 00:27:41.359 --> 00:27:45.559 I mean I'm a big fan in some ways outside of research. Venture is 399 00:27:45.640 --> 00:27:49.720 my actual skill set in crypto because it's the only other job I've actually worked 400 00:27:49.799 --> 00:27:55.039 in technically, right, So yeah, I mean I would say, look, 401 00:27:55.039 --> 00:27:56.400 they do, They're interested in a lot of things. I think some 402 00:27:56.559 --> 00:28:02.440 of the theses that I've seen that we've announced that have been invested in. 403 00:28:02.519 --> 00:28:06.480 One we just did a deal with Chainway Labs, which is the builders of 404 00:28:06.599 --> 00:28:08.279 Citria, which is a new zk row I think will be the first zk 405 00:28:08.400 --> 00:28:15.079 roll up on bitcoin. So you know, I think bitcoin composibility and extensibility 406 00:28:15.160 --> 00:28:19.240 is interesting there. I think in general, payments, stable coins, new 407 00:28:19.519 --> 00:28:25.880 next next generation blockchain technologies equity businesses in a variety of places. I mean, 408 00:28:26.480 --> 00:28:29.359 you know, Galaxy's got a giant portfolio of I mean, they've been 409 00:28:29.400 --> 00:28:33.359 investing well before I came in in crypto and doing ventures, so a ton 410 00:28:33.440 --> 00:28:36.319 of stuff. But I don't want to I don't want to say too much 411 00:28:36.359 --> 00:28:40.359 more because I don't know exactly what they're comfortable saying. But I mean literally, 412 00:28:40.400 --> 00:28:41.720 I think if you go to like crunch base or whatever the public data, 413 00:28:41.720 --> 00:28:45.400 you'll see like hundreds of investments, so like a lot historically a lot 414 00:28:45.480 --> 00:28:48.920 of the time. I think, you know, in general, what I 415 00:28:48.960 --> 00:28:52.440 would say in terms of like this year, themes that are very interesting, 416 00:28:52.519 --> 00:28:56.759 like I mentioned Bitcoin L two's absolutely, I would say modularity, restaking in 417 00:28:56.839 --> 00:29:00.880 the ethery world both very interesting. And in other you know, protocol worlds, 418 00:29:00.799 --> 00:29:07.119 you know, high speed you know, parallelized blockchains, new next generation 419 00:29:07.279 --> 00:29:11.519 blockchains I think could be very interesting, which is basically Solana technology, right, 420 00:29:11.599 --> 00:29:18.960 the parallelization of execution. That stuff's interesting. I think Solana is from 421 00:29:18.000 --> 00:29:23.480 a usage standpoint, like very pretty much undeniably the third chain now Bitcoin ethan 422 00:29:23.519 --> 00:29:27.880 Solona literally not in terms of what should happen, just literally in the amount 423 00:29:27.880 --> 00:29:32.720 of transaction volume, the amount of trading volume, the amount of TVL like 424 00:29:32.799 --> 00:29:37.759 if you look, it's basically third on all of those, so that's interesting. 425 00:29:37.039 --> 00:29:41.720 I think this rally has I've been describing it as like a barbell rally. 426 00:29:41.799 --> 00:29:47.240 It's basically like the l one majors, with obviously some exceptions. Every 427 00:29:47.279 --> 00:29:51.000 statement has plenty of exciptions, but it feels like a Bitcoin driven rally. 428 00:29:51.119 --> 00:29:53.559 I mean, it's bitcoins the only one of the majors that's retaken and exceeded 429 00:29:53.559 --> 00:29:57.559 it's all time high prior all time high still and then sort of like a 430 00:29:57.640 --> 00:30:02.519 meme coin rally. And to me, that tells me that like, yes, 431 00:30:02.799 --> 00:30:07.599 like mass market retail likes memes, but the fact that doge is so 432 00:30:07.759 --> 00:30:11.200 underperforming shows that they're not really here yet. In my mind, I feel 433 00:30:11.240 --> 00:30:15.319 like it's the jaded crypto native retail that like, we hung on for so 434 00:30:15.519 --> 00:30:19.400 long in that bear market, like and they're not excited right now about things 435 00:30:19.519 --> 00:30:25.519 like DeFi Web three metaverse, Like no one's really excited about that inside the 436 00:30:25.640 --> 00:30:27.759 crypto native world. I mean, I don't mean no one, and I 437 00:30:27.839 --> 00:30:33.240 think these things still have prospects, but like you know, the crypto natives 438 00:30:33.279 --> 00:30:36.160 that stuck around were like ready to go wig out on the risk itself, 439 00:30:36.279 --> 00:30:38.720 right, and that's why you have like these this cascade of derivative mean coins 440 00:30:40.359 --> 00:30:45.000 that have been rallying. Meanwhile, basically it's still a bitcoin driven market. 441 00:30:45.160 --> 00:30:48.480 I mean that this bitcoin is still more than fifty percent dominance by that metric. 442 00:30:48.599 --> 00:30:55.359 And so anyway, I think that there'll be some they'll catch they'll we 443 00:30:55.480 --> 00:30:57.920 catch up. I mean, DeFi is obviously very important in crypto. Still, 444 00:30:59.480 --> 00:31:02.119 it's just that someone's like, oh my god, like the not no 445 00:31:02.240 --> 00:31:03.160 one. There's some exceptions to this, of course, but we're not like 446 00:31:03.200 --> 00:31:07.319 all getting hyped up about the next lending protocol. It's not like DeFi summer, 447 00:31:07.400 --> 00:31:08.759 you know, yeah, no, absolutely, you're right. And then 448 00:31:10.000 --> 00:31:14.480 you know you're mentioning Solana. There's been a lot of mean coins building off 449 00:31:14.519 --> 00:31:18.440 of Solana. So a ton, yeah, a ton yeah. Let's talk 450 00:31:18.440 --> 00:31:22.960 about your bitcoin mining operations. I'm very curious about that because we've seen the 451 00:31:22.119 --> 00:31:26.759 rise of bitcoin mining in the US, even though we had some fud from 452 00:31:26.799 --> 00:31:33.759 the EIA Elizabeth Warren and likes of her camp. Where are your mining operations 453 00:31:33.920 --> 00:31:37.039 and you mentioned you're also hosting for other companies as well. Tell us a 454 00:31:37.079 --> 00:31:41.680 bit about that. Yeah, yeah, so we we have large mining operations 455 00:31:41.720 --> 00:31:48.319 in Texas in Urkat which is the Energy Reliability Council of Texas. I even 456 00:31:48.359 --> 00:31:52.039 remember that. Shout out to my friends Brian and Austin who run that business 457 00:31:52.119 --> 00:31:56.799 for if they're watching, Like I got that right, the acronym, so 458 00:31:57.079 --> 00:32:01.880 large facility there in Kins County, which we're a you know, big supporter 459 00:32:02.039 --> 00:32:07.160 of the folks there. It's a giant area of wind and solar production. 460 00:32:07.359 --> 00:32:09.160 To be clear, at Texas is I think I read once that the that 461 00:32:09.400 --> 00:32:14.119 if it were a country, would be the largest wind creator in the world, 462 00:32:14.279 --> 00:32:17.920 right, so like has this It has this you know, outdated reputation 463 00:32:19.119 --> 00:32:22.359 sometimes of being like oil country, and absolutely there is oil and and and 464 00:32:22.559 --> 00:32:28.440 fossil energy there, but it is I think it's a massive renewable energy generation 465 00:32:29.240 --> 00:32:34.279 state. So we have a big proprietary mining operation there. We also host 466 00:32:34.400 --> 00:32:38.119 there and yeah, I mean we're we have some of the best mining people 467 00:32:38.319 --> 00:32:45.079 and talent here in the space and continue to we've you know, we're a 468 00:32:45.119 --> 00:32:51.960 public company traded in Canada right the and you can see our financials and so 469 00:32:52.000 --> 00:32:54.319 I'm not really supposed to talk about this type of stuff specifically, but go 470 00:32:54.480 --> 00:32:59.839 and look, we have plenty of information about our mining businesses success, but 471 00:33:00.000 --> 00:33:02.960 I would say in general, look, we believe mining can be a great 472 00:33:04.000 --> 00:33:09.319 business. It can be run well. We love the optionality and and sort 473 00:33:09.359 --> 00:33:16.119 of like market dynamics in Texas that allow for dynamic pricing and hedging that that 474 00:33:16.359 --> 00:33:22.880 make us like a I think both a profitable and and positive art of the 475 00:33:23.000 --> 00:33:28.640 Texas energy grid. And so yeah, I mean, and we just I 476 00:33:28.680 --> 00:33:30.680 mean, mining is just an interesting and tough business overall, I would say, 477 00:33:30.720 --> 00:33:34.559 because like in thinking about it, like menting, you tell someone every 478 00:33:34.599 --> 00:33:37.160 four years that gold's going to have in value like that, you pull out 479 00:33:37.200 --> 00:33:40.400 of the ground like it. So it's a fun, difficult and uh fun 480 00:33:40.440 --> 00:33:45.279 and difficult business but with a lot of room for optimizing with your intellect. 481 00:33:45.480 --> 00:33:50.880 And we have some of the smartest people building and operating that that business. 482 00:33:50.960 --> 00:33:54.039 So we think it's an important important thing going forward. Sure, let's talk 483 00:33:54.079 --> 00:34:00.759 about bitcoins price movement. It seems to be ahead of schedule the type of 484 00:34:00.799 --> 00:34:06.079 price appreciation we're seeing happens post having but I think the ETFs, as we 485 00:34:06.160 --> 00:34:08.320 were talking about earlier is driving a lot of demand. What are your thoughts 486 00:34:08.360 --> 00:34:13.760 and do you think we see a blow off top this year? This was 487 00:34:13.800 --> 00:34:15.360 a big question people are really worried about, like two weeks ago. I 488 00:34:15.400 --> 00:34:17.079 mean, I think people are still worried about it, but I mean I 489 00:34:17.239 --> 00:34:20.960 started to hear this question about two weeks ago. I wrote about this, 490 00:34:21.159 --> 00:34:24.000 and I had pointed out to your point, Tony, that at the time 491 00:34:24.039 --> 00:34:29.679 it was fifty days before the having, now about forty days before the having, 492 00:34:30.000 --> 00:34:34.159 So I'm gonna use that outdated numbers. But fifty days before the prior 493 00:34:34.239 --> 00:34:38.840 to havings, bitcoin had was still between sixty and seventy percent below it's all 494 00:34:38.880 --> 00:34:44.199 time prior all time high. Yeah, fifty days before the having, this 495 00:34:44.400 --> 00:34:47.320 time we were twelve percent below the all time high, and of course forty 496 00:34:47.400 --> 00:34:52.000 days before it were over the all time high. Right, So that's new. 497 00:34:52.199 --> 00:34:54.320 I agree that that's new, and that has led some people to worry 498 00:34:54.400 --> 00:34:58.199 that we're like speed running the cycle, that like, well, wait a 499 00:34:58.280 --> 00:35:00.320 sec, does that mean we're going to talk too early? Right? And 500 00:35:00.400 --> 00:35:05.679 you even in the construction of your question said like are we ahead of schedule? 501 00:35:05.920 --> 00:35:12.599 Right? So I'm here to say that basically none of that matters, 502 00:35:12.719 --> 00:35:16.119 and this time is different, and the reason it's different is for because of 503 00:35:16.119 --> 00:35:20.360 the ETFs. I mean, I doubt we'd be where we are in the 504 00:35:20.440 --> 00:35:25.679 supposed cycle if the ETFs hadn't come out when they did. It's driving there's 505 00:35:25.719 --> 00:35:29.840 a giant amount of money that likes bitcoin that was never able to really figure 506 00:35:29.840 --> 00:35:31.840 out how to do it. You've told your parents and grandparents, all they 507 00:35:31.880 --> 00:35:35.199 got to do is down on this app blah blah blah. Well there's still 508 00:35:35.280 --> 00:35:37.400 like three steps, three or four steps of complicate. They got to take 509 00:35:37.400 --> 00:35:40.639 a picture of their driver's license. Like I know tons of people who are 510 00:35:40.639 --> 00:35:43.679 like, yeah, I just I tried to you and I didn't fit get 511 00:35:43.719 --> 00:35:46.039 through the onboard. It's I know it's not that hard to us, but 512 00:35:46.199 --> 00:35:50.519 like you know, it's hard to allot of people. And certainly on the 513 00:35:50.559 --> 00:35:52.679 advisors side, they can't set up a coin based account for every one of 514 00:35:52.719 --> 00:35:55.599 their clients, nor would they want to, because if it's not inside their 515 00:35:55.639 --> 00:35:59.599 advisor managed accounts, they don't make any money off it, right, So 516 00:36:00.599 --> 00:36:02.960 there there is a giant pile of money that is looking to get involved. 517 00:36:04.039 --> 00:36:08.519 I also think the macro situation it's really becoming quite serious on the government debt 518 00:36:08.679 --> 00:36:13.760 and fiscal situation in the United States and globally in a way that was just 519 00:36:13.840 --> 00:36:17.599 simply not the case even five years ago. And what I mean, the 520 00:36:17.719 --> 00:36:22.880 trajectory was bad then and it's obviously only gotten worse now. But the under 521 00:36:23.280 --> 00:36:28.760 the there is pervasive fear in the investment community about the state of the American 522 00:36:28.880 --> 00:36:32.039 fiscal situation. I mean truly, like it's not it's no longer a low 523 00:36:32.119 --> 00:36:36.639 murmur for gold bugs to complain about the national debt. You have the literally 524 00:36:36.719 --> 00:36:39.960 the world's most famous investors all basically freaking out about it. Right. You've 525 00:36:40.679 --> 00:36:45.039 Jamie Diamond is you know, shout out Jamie our friend, he said it 526 00:36:45.119 --> 00:36:49.280 it's unsustainable, stand truck and Miller, Paul Tutor, Jones, these guys 527 00:36:49.320 --> 00:36:54.239 have all been talking about this. It's even even Chairman Powell and CNN finally 528 00:36:54.480 --> 00:37:00.119 admitted directly that it is absolutely unsustainable and and a problem. I'm now obviously 529 00:37:00.599 --> 00:37:06.880 the FED. It's a fiscal question. It's not a it's not a monetary 530 00:37:07.000 --> 00:37:09.079 question. In some cases, it's the tail wagging the dog with the FED 531 00:37:09.199 --> 00:37:14.280 having to try to deal with and absorb the issuance that's coming. But the 532 00:37:14.440 --> 00:37:19.039 US is adding one hundred adding a trillion dollars to the national debt currently about 533 00:37:19.079 --> 00:37:23.480 every hundred days. And in that environment, you're looking for hard assets and 534 00:37:23.559 --> 00:37:28.400 particularly ones that you could use that aren't controlled by a state. You know, 535 00:37:28.519 --> 00:37:34.800 even real estate is certainly good. We have very strong property ownership protections. 536 00:37:34.880 --> 00:37:37.280 And law in the United States is important, by the way, as 537 00:37:37.320 --> 00:37:42.199 a core foundation of a free market to have value. It's one of the 538 00:37:42.239 --> 00:37:45.440 reasons the capital markets are so valid in the US is because of our rule 539 00:37:45.480 --> 00:37:51.760 of law. But you can envision, and certainly in a less advanced country, 540 00:37:52.639 --> 00:37:54.559 but you could envision when you know, like for example, I just 541 00:37:54.599 --> 00:38:00.199 read a story today that the top like compliance investigator for Binance when to a 542 00:38:00.280 --> 00:38:05.639 meeting in Nigeria about this and what was detained is basically being held ransom by 543 00:38:05.639 --> 00:38:08.880 the Nigerian government. They want ten billion dollars from finance. Well that's they're 544 00:38:08.920 --> 00:38:14.440 seeing greater than thirty percent monthly inflation right now in Nigeria. So you can 545 00:38:14.519 --> 00:38:21.079 imagine if that if the US or any country experiences that level of economic fiscal 546 00:38:21.360 --> 00:38:27.360 monetary struggle, that the rule of law can break down. So you really 547 00:38:27.480 --> 00:38:31.639 want things that you can possess yourself, the hardest assets, you know, 548 00:38:32.000 --> 00:38:35.280 a deed to a house. Yeah, I mean it's pretty good, but 549 00:38:35.480 --> 00:38:37.360 like, you know, it's better is like cryptographic keys to like a global 550 00:38:37.400 --> 00:38:42.920 digital asset in my opinion, So that is also going to be helping bitcoin, 551 00:38:43.840 --> 00:38:45.199 I think. And whether that's you know, good or bad, I 552 00:38:45.280 --> 00:38:49.679 mean I don't, I don't. You know, the uncertainty, the geopolitical 553 00:38:49.719 --> 00:38:53.079 fragmentation, the macro situation, the government debt situation is all I think very 554 00:38:53.159 --> 00:38:59.800 supportive for bitcoin. And you know, so broadly, is is there I 555 00:39:00.239 --> 00:39:01.960 sort of joking with you at the beginning of this question that like is there 556 00:39:02.000 --> 00:39:07.000 a schedule? Sure, historically we've seen that like the having and is this 557 00:39:07.159 --> 00:39:12.960 part but even that, like was that causation or merely correlation? I've seen 558 00:39:13.039 --> 00:39:15.800 other people who have who have argued that just global liquidity lines up better with 559 00:39:15.880 --> 00:39:20.960 the bitcoin cycles. Like, so, yeah, this time is different. 560 00:39:21.079 --> 00:39:23.800 I acknowledge that, but I also think this time is different. I think 561 00:39:23.840 --> 00:39:29.480 we've got a giant new set of market access vehicles, we've got a very 562 00:39:29.599 --> 00:39:35.760 different macro situation, and we have just again a giant a growing base you 563 00:39:35.840 --> 00:39:38.400 know, like the number of people that are interested in bitcoin and digital assets 564 00:39:38.440 --> 00:39:44.679 crypto in general, it's significantly larger than that, and and and it's going 565 00:39:44.719 --> 00:39:47.320 to get larger. So I don't I'm definitely not saying super cycle. There 566 00:39:47.360 --> 00:39:52.039 probably is top, like there probably is a cycle. I mean, I 567 00:39:52.440 --> 00:39:54.639 don't want to deny history. They probably see it the same thing. But 568 00:39:54.760 --> 00:39:58.800 again, this one also already looks a little bit different in other ways as 569 00:39:58.880 --> 00:40:01.559 well as prior ones. You know, I just I think it's too early 570 00:40:01.679 --> 00:40:06.559 to say. I really don't think that, you know, five percent ten 571 00:40:06.639 --> 00:40:08.400 percent above the prior all time high as the top though, I really don't 572 00:40:08.400 --> 00:40:12.840 think we're close to it personally for sure. And you know, to your 573 00:40:12.920 --> 00:40:15.880 point, I think a lot of people are becoming more aware of the macro 574 00:40:15.239 --> 00:40:20.800 issues while historically they haven't really paid attention. But maybe the Internet, the 575 00:40:20.840 --> 00:40:24.119 flow of information is helping social media, like you said, even Jerome Powell 576 00:40:24.480 --> 00:40:29.760 talking about the debt situation. So question about that, you know, is 577 00:40:29.840 --> 00:40:34.679 bitcoin impossible solution. I'm not saying it's the only solution to that global debt 578 00:40:34.719 --> 00:40:37.599 situation, to fiat currency problem, we've see central banks are awarding gold. 579 00:40:38.000 --> 00:40:43.840 So what if eventually they start to hold bitcoin also as a reserve asset. 580 00:40:44.199 --> 00:40:46.800 And I don't know what the reset looks like for fiat currencies, but any 581 00:40:46.880 --> 00:40:51.840 thoughts on that. Yeah, it's definitely not the only thing, right, 582 00:40:51.880 --> 00:40:54.039 I mean, again, precious metals, I mean, from an investment great 583 00:40:54.079 --> 00:40:59.320 standpoint, gold is still a huge deal, certainly at the sovereign and central 584 00:40:59.360 --> 00:41:02.840 bank level, you know, Yeah, I mean, so I think we 585 00:41:02.920 --> 00:41:07.519 will. I honestly, I would bet we will see more sovereigns, so 586 00:41:07.679 --> 00:41:12.480 nation states or sovereign wealth funds. I don't we don't have a central bank 587 00:41:12.519 --> 00:41:15.199 as far as I'm aware of of any type yet that holds bitcoin, but 588 00:41:15.400 --> 00:41:20.480 it wouldn't surprise me. And frankly, I would suggest that, like anyone 589 00:41:22.679 --> 00:41:24.920 you know, the right allocation of bitcoin can be hinting to your portfolio from 590 00:41:24.960 --> 00:41:30.079 a risk adjusted basis and blah blah blah like at certain levels like and again 591 00:41:30.199 --> 00:41:32.199 even at small levels, it can have a positive impact. So I think 592 00:41:32.239 --> 00:41:36.639 that's true. Basically the math that I've seen and that we've published on our 593 00:41:36.719 --> 00:41:42.599 website and research we've written shows that that's provably true, right, so to 594 00:41:42.760 --> 00:41:45.599 me, like in a world of uncertainty and growing uncertainty. Again, you 595 00:41:45.719 --> 00:41:51.360 want harder assets, and so I think you will see it. Yeah, 596 00:41:51.719 --> 00:41:55.599 And something that happened recently, the state of Arizona is look is looking to 597 00:41:55.679 --> 00:42:00.840 pass a bill that will allow them to add the bitcoin ETPs I believe to 598 00:42:00.960 --> 00:42:05.840 their pension or treasury one of those. So it's interesting that states here in 599 00:42:05.880 --> 00:42:08.480 the United States are looking to do that, and I think one of them 600 00:42:08.760 --> 00:42:10.960 does it. You know, there's going to be a bunch that follows. 601 00:42:12.400 --> 00:42:16.159 So oh yeah, I'm very fascinating to see how that plays out. Yeah, 602 00:42:16.239 --> 00:42:21.800 I think there are already states to be clear and who's whose government employee 603 00:42:21.880 --> 00:42:24.400 pensions or whichever depend Different states do this differently, by the way, in 604 00:42:24.480 --> 00:42:28.360 some cases, like you know, you're telling me that Arizona may pass a 605 00:42:28.440 --> 00:42:30.960 law allowing them to do I believe in many states nothing like that is wire 606 00:42:31.119 --> 00:42:36.000 they outsourced the management of their pension to an financial advisor, so they may. 607 00:42:36.320 --> 00:42:39.639 I believe there are already several, you know, large like pensions comprised 608 00:42:39.679 --> 00:42:44.920 of government employees or state employees that already have exposure to crypto in general, 609 00:42:45.039 --> 00:42:47.440 like whether it're bitcoin directly or venture by the way, huge, I mean 610 00:42:47.960 --> 00:42:52.760 almost all of them. There are plenty of big investors in you know, 611 00:42:52.000 --> 00:42:55.480 the big crypto vcs as well. So but yeah, you will see it 612 00:42:55.599 --> 00:43:00.960 like again, like that's that's not that's not Not only is it not far 613 00:43:00.000 --> 00:43:06.079 away, it's already happening for sure. Now there's talks of any theorems POTYTF 614 00:43:06.159 --> 00:43:07.920 coming this year. It is a May twenty third deadline. Some people are 615 00:43:07.920 --> 00:43:12.320 saying it may not happen then, but it will eventually happen. And if 616 00:43:12.400 --> 00:43:15.400 the SEC decides they don't want to approve it, folks are going to take 617 00:43:15.440 --> 00:43:19.800 them to the court and win like they did in the Bitcoin situation. What 618 00:43:19.880 --> 00:43:23.480 are your thoughts on the approval of the ETHEROREMYTF It would be a big deal 619 00:43:24.199 --> 00:43:30.800 for ethereum. I personally don't think you'll see as much interest from traditional finance 620 00:43:30.880 --> 00:43:37.559 and allocators as you are in Bitcoin. And that's it's just a more complicated, 621 00:43:37.639 --> 00:43:39.519 different, you know, different thing. It's not as easy as story. 622 00:43:39.599 --> 00:43:43.679 It's it's got other there are other things like I mean, you know, 623 00:43:44.400 --> 00:43:46.840 not to throw shades specifically on Etheroreum, but like they've changed their monetary 624 00:43:46.880 --> 00:43:51.239 policy like nine times, Like some of the pitch doesn't make as much sense, 625 00:43:51.360 --> 00:43:52.800 and it's and by the way, it hasn't been practiced. I mean 626 00:43:53.559 --> 00:43:59.360 the bitcoin world, and I mean even in the financial world who likes bitcoin 627 00:43:59.440 --> 00:44:06.039 has been successfully explaining and running the numbers and pitching bitcoin for like over a 628 00:44:06.199 --> 00:44:08.679 decade, right, Like, so it's like, we know what the story 629 00:44:08.880 --> 00:44:13.400 is, we know why people should allocate it. Theoria is a much more 630 00:44:13.480 --> 00:44:16.119 complicated and different type of system, but it would definitely be a big deal 631 00:44:16.199 --> 00:44:20.639 for Theoryum, I'm in the camp. I mean, I've called it publicly 632 00:44:20.679 --> 00:44:23.039 a toss up whether something happens in May. I don't really meaning, like 633 00:44:23.159 --> 00:44:30.159 you know, I happen to think it's less likely than it's less likely than 634 00:44:30.440 --> 00:44:35.000 not or less than fifty percent. We'll just say that way a chance that 635 00:44:35.079 --> 00:44:38.599 it's approved in May. The reason for May is similar to the January eleventh, 636 00:44:38.679 --> 00:44:42.639 like our FINALI approved a nine date for the bit twenty TF I forget 637 00:44:42.679 --> 00:44:46.199 which one it is, but some of the several filers have their final nineteen 638 00:44:46.280 --> 00:44:52.639 before approved deny date in May, and so you know, they can either 639 00:44:52.719 --> 00:44:58.480 withdraw or they can be accepted or rejected. Right, And there's a bunch 640 00:44:58.559 --> 00:45:02.719 of we could hash out the arguments for and against I think long term absolutely 641 00:45:02.880 --> 00:45:08.199 like they will be approved. The main reason is because the SEC already approved 642 00:45:08.199 --> 00:45:14.079 the Cash Settled Futures ETH ETFs. So like that's basically the pathway that's been 643 00:45:14.159 --> 00:45:19.199 set by the Bitcoin ETFs. Right, get you get CM futures, maybe 644 00:45:19.239 --> 00:45:22.440 maybe you get Canadian ETFs. Bitcoin and ETH have both, right, and 645 00:45:22.760 --> 00:45:25.960 typically Canada was part of this. Now like it's directly relevant, but it 646 00:45:27.079 --> 00:45:30.440 was in this order. Then you get the futures based ETF, and then 647 00:45:30.480 --> 00:45:34.840 you get the spot ETF. Like that's that's what Bitcoin did, and ETH 648 00:45:34.880 --> 00:45:37.719 has three of the four. So like it seems like if you're going to 649 00:45:37.840 --> 00:45:45.599 deny the Eth ETFs for something other than the same reasons why they wanted to 650 00:45:45.679 --> 00:45:49.760 they had been denying the Bitcoin ones, which was primarily about surveillance sharing agreements 651 00:45:49.800 --> 00:45:52.159 and a regulated market of sufficient size stuff. And that those questions are what 652 00:45:52.320 --> 00:45:57.360 was basically directly rejected by the d C Circuit Court of Appeals in the Grayscale 653 00:45:57.400 --> 00:46:01.519 case last August and August twenty three and effectively forced the hand of the SEC. 654 00:46:01.760 --> 00:46:06.920 Right there were no other arguments they basically ever made for why they shouldn't 655 00:46:06.920 --> 00:46:09.360 approve the bitcoin e TF. So when those two arguments were returned, there 656 00:46:09.400 --> 00:46:15.159 were no other good arguments you. I mean, bitcoin and theory are significantly 657 00:46:15.320 --> 00:46:17.599 different enough in my view that like, you could bring up other arguments, 658 00:46:17.639 --> 00:46:21.920 But the problem is they already if you're the sec looking to deny, in 659 00:46:22.000 --> 00:46:24.000 my opinion, you've already approved the cash settled future. So like, if 660 00:46:24.039 --> 00:46:29.360 you wanted to bring up other arguments other than the correlation between spot and futures 661 00:46:29.400 --> 00:46:34.280 prices, the availability of surveillance sharing agreements, and blah blah blah, you 662 00:46:34.360 --> 00:46:37.800 should have done it when you heard the future CTFs, not now that you've 663 00:46:37.840 --> 00:46:40.599 allowed them. So this is the common argument in favor of why people think 664 00:46:40.679 --> 00:46:45.679 that they could be approved in May. I just you know, I just 665 00:46:45.719 --> 00:46:46.679 don't know. It's why I'm calling it a toss up. I think, 666 00:46:46.760 --> 00:46:51.480 obviously invite they get approved at some point. It's just a matter of if 667 00:46:51.519 --> 00:46:54.239 they get rejected. You know who sues? Does does Gray Scale sue? 668 00:46:54.239 --> 00:46:58.079 Again? I don't know. I genuinely don't know. So, I mean, 669 00:46:58.360 --> 00:47:00.960 if they have to be great, the se see has to isn't going 670 00:47:01.039 --> 00:47:05.480 to act absent a direct ruling from a court, then I don't know. 671 00:47:05.519 --> 00:47:08.159 When it would happen, but eventually they probably win that case. You would 672 00:47:08.199 --> 00:47:14.039 sit the d C. Circuit Court of Appeals decision and gray scale as as 673 00:47:14.400 --> 00:47:17.199 the cop here right in your in your court case. Yeah, absolutely So 674 00:47:17.400 --> 00:47:22.039 on that note, you know, we are facing a lot of regulatory hurdles. 675 00:47:22.079 --> 00:47:25.639 There's a lot of uncertainty the sec. I mean, it's a mess. 676 00:47:25.880 --> 00:47:29.679 They're losing in court, they're suing people, people are suing them. 677 00:47:30.880 --> 00:47:32.880 But Congress has a couple of bills in the House, there's two in the 678 00:47:34.000 --> 00:47:37.360 Senate. I don't know what you guys are hearing. I don't know what 679 00:47:37.480 --> 00:47:40.239 Mike is hearing. But you know, are you optimistic that we might see 680 00:47:40.679 --> 00:47:45.199 some sort of regulation this year or maybe next year? Oh? Yeah, 681 00:47:45.239 --> 00:47:47.679 I mean on a long enough time frame, I mean next year. A 682 00:47:47.760 --> 00:47:50.960 big difference between this year and next year, I would say, I mean 683 00:47:51.000 --> 00:47:57.239 we're an election cycle this year at the federal presidential obviously, so and that 684 00:47:57.400 --> 00:48:00.800 makes it a little trickier. I would say, I think of the you 685 00:48:00.880 --> 00:48:06.480 know, major issues that I've seen before Congress on this is you know, 686 00:48:06.679 --> 00:48:10.440 stable coins, realizing them, regulating them whatever. I mean, they're already 687 00:48:10.519 --> 00:48:14.800 legal, but you know, formalizing the rules around them, creating a regulatory 688 00:48:14.880 --> 00:48:17.440 framework to issue and use them, and blah blah blah. And obviously we've 689 00:48:17.480 --> 00:48:21.760 had work on that done. I think great work in the House Financial Services 690 00:48:21.800 --> 00:48:27.119 Committee with current Chair Pat McHenry and ranking member Maxine Waters. And even when 691 00:48:27.559 --> 00:48:31.360 Maxine Waters was chair and Pat McHenry was ranking member, they also did good 692 00:48:31.400 --> 00:48:37.079 work. So there's there's some bipartisan desire to do that, to do something. 693 00:48:37.280 --> 00:48:39.480 I'm hearing that there may be new movement happening on it as well. 694 00:48:39.639 --> 00:48:44.280 So I would say most likely of any of the things that are sort of 695 00:48:44.400 --> 00:48:49.800 big stable coins could still happen this year. I'm not really, I'm not, 696 00:48:50.159 --> 00:48:52.400 you know, holding my breath for a market structure bill, which you 697 00:48:52.480 --> 00:48:55.199 know, the idea here is like, well, maybe we could sort out 698 00:48:55.280 --> 00:49:00.679 some of the conflicts that have arisen between the se see end the industry about 699 00:49:00.800 --> 00:49:05.119 like well, what is a security, what's a commodity? Who regulates what 700 00:49:05.280 --> 00:49:07.440 when? Like that, there's a couple of proposals the Fit Act, the 701 00:49:07.559 --> 00:49:13.559 Lamas Jillibrand Bill, and the Senate there was the stab An O Bozeman proposal, 702 00:49:13.679 --> 00:49:17.679 Like there's several of these bipartisan. I'd be very surprised if there's really 703 00:49:17.719 --> 00:49:22.559 any real traction on that this year. There's also not a lot of time. 704 00:49:22.639 --> 00:49:24.639 I know it's crazy, but like you've got the government, you've got 705 00:49:24.719 --> 00:49:28.880 must pass spending stuff where the government could shut down again, right, this 706 00:49:29.000 --> 00:49:32.360 is the new normal in America. Congress hasn't passed a budget on time since 707 00:49:32.480 --> 00:49:37.880 nineteen ninety six, so like they're basically struggling to keep their head above water, 708 00:49:38.079 --> 00:49:42.679 just doing their basic job. So like big sweeping bi apartisan and stuff. 709 00:49:42.840 --> 00:49:45.679 I mean, we haven't amended the tax code in thirty years, right, 710 00:49:45.800 --> 00:49:47.880 so in general, hard to get the stuff done. I would say. 711 00:49:47.920 --> 00:49:52.760 The other thing that obviously has been top of mind is illicit finance related 712 00:49:52.119 --> 00:49:58.599 questions. Senator Warren's proposed bill, the Digital Asset Anti Money Laundering Act, 713 00:49:58.800 --> 00:50:02.599 is you know, was raising a lot of eyebrows and getting a lot of 714 00:50:02.760 --> 00:50:08.440 interest, partly because of the renewed interest following the Hamas's attacks on Israel on 715 00:50:08.559 --> 00:50:15.360 ten seven, But even then, it was initially introduced right after FTX and 716 00:50:15.599 --> 00:50:21.360 got some in fall twenty twenty two. I've been very vocal I won't retash 717 00:50:21.360 --> 00:50:22.719 the little thing I think it's a terrible bill. I think it doesn't do 718 00:50:22.880 --> 00:50:29.320 what she claims it does, and what it does do basically criminalizes running software 719 00:50:29.400 --> 00:50:32.960 in America. So I think it doesn't even accomplish what she says it should 720 00:50:34.000 --> 00:50:39.519 accomplish. It would create an unenforceable prohibition on basic, basic freedoms that Americans 721 00:50:39.639 --> 00:50:45.239 have. It's a crazy concept. There are other ways to help style me 722 00:50:45.639 --> 00:50:47.880 the use of crypto assets for illicted finance. That and by the way, 723 00:50:47.960 --> 00:50:52.960 she constantly says that shouldn't crypto firms have to follow the same rules as banks. 724 00:50:52.960 --> 00:50:55.719 Well, first of all, that's a loaded term because banks actually have 725 00:50:55.760 --> 00:50:59.920 a whole different set of rules that many financial companies don't have to follow. 726 00:51:00.559 --> 00:51:04.480 But by the way, what she means is like on AML and KYC laws, 727 00:51:05.360 --> 00:51:08.199 they do crypto firms do. Her bill doesn't put it on crypto firms. 728 00:51:08.239 --> 00:51:13.039 It tries to apply the Bank Secrecy Act to nodes, minors, software 729 00:51:13.039 --> 00:51:16.239 developers. Is crazy. There's no precedent for that at all. So there 730 00:51:16.360 --> 00:51:22.159 is a potential always and I've been warning about this for something in that world 731 00:51:22.679 --> 00:51:25.960 or in that sort of issue to bubble up in Congress. Those are the 732 00:51:27.039 --> 00:51:30.119 three sort of main right stables, market structure, listed finance that I'm really 733 00:51:30.159 --> 00:51:32.360 seeing. I should say, there have been plenty of other good bills that 734 00:51:32.480 --> 00:51:37.320 have been introduced in the House and Senate that are maybe more narrow. There's 735 00:51:37.360 --> 00:51:40.039 the proof fact from Senators Tillis and heckn Looper in the Senate Banking Committee that 736 00:51:40.599 --> 00:51:45.039 mandates proof of reserves on cryptographic you know, crypto style proof of reserves on 737 00:51:45.119 --> 00:51:50.679 exchanges and custodians in the US. I think that's just undeniably positive for consumers, 738 00:51:50.719 --> 00:51:53.320 and it's also great. It's a technology that you can only do with 739 00:51:53.440 --> 00:51:59.880 crypto assets. Right. It's actually an area where crypto assets are significantly better 740 00:52:00.039 --> 00:52:04.119 than traditional assets. Right. You can't mathematically prove the stock is in your 741 00:52:04.119 --> 00:52:07.159 account, but you can mathematically prove the cryptos in your account. So, 742 00:52:07.760 --> 00:52:13.719 and others a variety in the House as well. There's issues with like SAB 743 00:52:13.800 --> 00:52:17.519 one twenty one, which is the stupid staff accounting bulletin out of the SEC 744 00:52:17.679 --> 00:52:22.599 that blah blah blah. Long story short, it makes it impossible for publicly 745 00:52:22.639 --> 00:52:27.400 traded banks to touch crypto. Mike Flood and Richie Torres and the House have 746 00:52:27.519 --> 00:52:31.760 introduced a bill under the Congressional Review Act to block it, or I don't 747 00:52:31.800 --> 00:52:36.480 know the terminology overturn it. I mean, there's plenty of interesting and bipartisan 748 00:52:36.559 --> 00:52:38.960 works, but I would look out for illsted finance and stable coins as being 749 00:52:39.079 --> 00:52:45.519 possible this year. Market structure most likely not. Yeah, it's tough, 750 00:52:45.599 --> 00:52:47.079 Like you said, government has to get out of its own way a whole 751 00:52:47.119 --> 00:52:51.800 bunch of other things, but hopefully they can come together and get this through 752 00:52:51.880 --> 00:52:55.559 it within the next two years. What are your thoughts on NFTs and tokenization 753 00:52:55.679 --> 00:53:00.519 and is Galaxy looking to do anything on that front. I've been looking at 754 00:53:00.559 --> 00:53:04.840 this myself for years. Token is a you know, I mentioned sort of 755 00:53:04.880 --> 00:53:07.199 at the top of the discussion a little bit about how we looked in all 756 00:53:07.239 --> 00:53:09.159 this private blockchain enterprize blockchain related stuff. A lot of that was sort of 757 00:53:09.280 --> 00:53:15.119 like tokenization questions. I happen to believe that public blockchains and distributed ledgers are 758 00:53:15.559 --> 00:53:22.280 a far superior technology for uh tracking the ownership and transfer of assets of all 759 00:53:22.320 --> 00:53:25.159 types. So, like I personally, if I think if you developed a 760 00:53:25.239 --> 00:53:30.920 financial system from scratch, you would absolutely have a lot of these tokenized assets. 761 00:53:30.960 --> 00:53:36.000 You'd probably obviate the need for the Depository Trust and Clearing Corporation the DTCC, 762 00:53:36.199 --> 00:53:37.480 by the way, they wrote a paper in twenty fifteen or sixteen that 763 00:53:37.519 --> 00:53:42.239 said they should be disinterremediated by blockchain that they were very forth uh, you 764 00:53:42.320 --> 00:53:45.880 know, forward looking about that, and they're totally right. There's a variety 765 00:53:45.880 --> 00:53:49.280 of reasons why we haven't seen it at scale outside of the stable coin use 766 00:53:49.360 --> 00:53:52.920 case, which is I think a tokenization like group of concept that is absolutely 767 00:53:52.960 --> 00:53:58.159 positive stable coins. That is tokenization that's working right. People love stable coins 768 00:53:58.159 --> 00:54:01.079 all over the world. I think you'll see more. I think we're we're 769 00:54:01.159 --> 00:54:06.559 very interested in it. We have some efforts, mostly not publicly disclosed, 770 00:54:06.599 --> 00:54:12.159 that are that we're interested in research and development side. I think you are 771 00:54:12.360 --> 00:54:17.800 seeing the increasing tokenization of things like private credit and treasuries on chain right from 772 00:54:19.119 --> 00:54:22.960 issuers like I think, you know, like Franklin TEMPLETONA maybe others like what 773 00:54:22.079 --> 00:54:24.960 we call r w A. I hate to say that because actually I'm with 774 00:54:25.039 --> 00:54:29.440 it, but my colleagues that come from the real traditional finance world, even 775 00:54:29.440 --> 00:54:31.039 though I come from Fidelity, I'm not like from Rice. I told you 776 00:54:31.119 --> 00:54:35.039 I did legal and compliance primarily before I did cryptos. I'm not like a 777 00:54:35.719 --> 00:54:38.360 finance guy in that sense. But my colleagues tell me that's actually the acronym 778 00:54:38.440 --> 00:54:43.320 for risk weighted assets, and they get annoyed when people misuse acronyms. But 779 00:54:43.480 --> 00:54:46.559 in any case, r w as have been a very interesting theme in the 780 00:54:46.679 --> 00:54:50.519 last year and I think will continue to be. So maybe that's the pathway 781 00:54:50.599 --> 00:54:55.280 we finally start to see tokenization as sort of a broad thing. NFT is 782 00:54:55.440 --> 00:55:00.199 like, I mean, I think I'm personally interested in scarce artwork generally that 783 00:55:00.480 --> 00:55:06.559 is pleasing to me. I'm not a huge believer or just don't have ambivalent 784 00:55:06.599 --> 00:55:09.440 don't have many cares for buying pfps and things like that. I would say 785 00:55:09.480 --> 00:55:15.400 we do follow it very closely. Galaxy owns a number of NFTs that we've 786 00:55:15.559 --> 00:55:17.840 talked about. I mean, on our out we've got punks and other stuff. 787 00:55:19.079 --> 00:55:22.000 The Galaxy on is on its balance sheet, So I mean we like 788 00:55:22.199 --> 00:55:27.079 NFTs. I would say broadly. I think it's kind of interesting. You 789 00:55:27.159 --> 00:55:30.960 see the NFT market really sort of lagging here while the mean coin market, 790 00:55:30.039 --> 00:55:34.480 which is kind of similar, right, It's kind of like, yeah, 791 00:55:34.679 --> 00:55:38.280 maybe you don't get like an individualized jpeg to display your community affiliation, but 792 00:55:38.400 --> 00:55:43.920 it is sort of a community building vibe a lot of these meaning coins, 793 00:55:43.960 --> 00:55:45.079 you know, like you're you're part of the community. You can do token 794 00:55:45.159 --> 00:55:49.400 gated access, you don't need an NFT you can do a you can do 795 00:55:49.519 --> 00:55:53.079 a fungible token and do token gated access with So you're seeing something similar. 796 00:55:53.199 --> 00:55:57.599 I think we obviously follow it from a research standpoint. Volumes are still done 797 00:55:57.719 --> 00:56:00.800 huge. Probably the most interesting thing in NFT today as bitcoin ordinals, which 798 00:56:00.800 --> 00:56:04.880 are dominating trade volumes at most of them. I mean, I just looked 799 00:56:04.920 --> 00:56:07.840 recently of something like eighty percent of the Magic Eaten volume is bitcoin related. 800 00:56:08.519 --> 00:56:14.719 So I don't know how sustainable that is. I mean, we've covered inscriptions 801 00:56:14.760 --> 00:56:19.679 and ordinals earlier and at better length and deeper than anyone that I know. 802 00:56:19.800 --> 00:56:23.559 We have multiple deep, long reports about it. We're in a unique position 803 00:56:23.639 --> 00:56:27.239 to cover it because we know bitcoin really well, we know NFT's well, 804 00:56:27.239 --> 00:56:30.159 we have a bitcoin mining business that we can get the miners perspective involved in. 805 00:56:30.599 --> 00:56:34.920 But to me that that's probably the most interesting story at the moment in 806 00:56:35.079 --> 00:56:37.800 NFT world. So, I mean, you know, I think it drives 807 00:56:37.800 --> 00:56:42.559 activity. I mean, I'd be crazy if I said that the PFPS will 808 00:56:42.760 --> 00:56:45.840 go away. I think whether we rebound to like I mean, that was 809 00:56:45.920 --> 00:56:51.159 the really forefront narrative in the twenty twenty one Bowl market. We may never 810 00:56:51.280 --> 00:56:52.800 get back there, or maybe it's crazy for me to even say that, 811 00:56:52.880 --> 00:56:57.840 and we eventually exceeded at scale. I really don't know, but I think, 812 00:56:57.960 --> 00:57:00.679 you know, artwork on the blockchain is it's going to be here to 813 00:57:00.760 --> 00:57:05.039 stay. Yeah, And I'm excited to see NFT utility. To your point, 814 00:57:05.119 --> 00:57:07.400 I'm not so much into the collectibles aspect, but if I can get 815 00:57:07.440 --> 00:57:13.599 an NFT that gives me special perks, benefits, access, and I know 816 00:57:13.719 --> 00:57:17.280 there's dynamic NFTs being worked on for different industries with cars, real estate, 817 00:57:17.280 --> 00:57:22.039 and so forth. So I'm excited to see that aspect of it. Yeah, 818 00:57:22.119 --> 00:57:24.199 I mean I think you could have I mean, from a tokenization standpoint, 819 00:57:24.280 --> 00:57:29.360 that's right. I mean, you can tokenize non fungible assets like real 820 00:57:29.480 --> 00:57:32.320 estate and identity. I mean I think, I mean, I'm basically in 821 00:57:32.480 --> 00:57:36.719 favor of all of this. There's just a variety. In some cases you 822 00:57:36.760 --> 00:57:38.239 don't really need the blockchain for that. Really, what we're talking about in 823 00:57:38.320 --> 00:57:44.199 those in whatever industry, it's that they need better digitization and other issues. 824 00:57:44.239 --> 00:57:47.559 There's a slew of intermediaries that would be harmed if the if we would disintermediate 825 00:57:47.599 --> 00:57:52.039 them, so well, it's possible. It's going to be the UX for 826 00:57:52.159 --> 00:57:54.360 us has to be ten x better so that we can convince the people to 827 00:57:54.400 --> 00:57:58.800 cut them out or whatever where they stand in the way or there's or there's 828 00:57:58.840 --> 00:58:01.679 regulation. Like I think, Like I said, if I designed it from 829 00:58:01.719 --> 00:58:05.360 scratch, I think we'd use this technology a lot more than we do today. 830 00:58:05.400 --> 00:58:07.079 But it's going to be slow going for a variety of reasons, for 831 00:58:07.239 --> 00:58:10.519 sure, Alex. I got some wrap up questions here for you. First, 832 00:58:10.559 --> 00:58:13.679 if you could create your own metaverse, what would the theme be? 833 00:58:15.440 --> 00:58:19.360 Oh man, you'd have the Las Vegas sphere with Michael Saylor's face on it 834 00:58:19.440 --> 00:58:23.960 saying there is no second best, is no second best? Right, I 835 00:58:24.000 --> 00:58:27.639 don't know. If you'd have there'd be a lot of hip hop music. 836 00:58:27.719 --> 00:58:30.199 You'd have DJs everywhere, We'd have some break beats going on, some people 837 00:58:30.280 --> 00:58:35.639 doing some breakdancing on cardboard in the streets, and it would be it would 838 00:58:35.639 --> 00:58:39.480 be Sonny in sixty seven degrees every day and we'd all be having a We 839 00:58:39.480 --> 00:58:44.000 would be walking constantly to a baseball game, like eating a hot dog, 840 00:58:44.119 --> 00:58:47.960 listening to you know, listening to DJ Screw or like three six Mafia or 841 00:58:49.119 --> 00:58:54.760 you know nas or Tupac. Nice hip hop The Sailor as the Sun God 842 00:58:54.920 --> 00:59:04.199 themed metaverse. That's my idea. Questions favorite food oh Man, pad tie, 843 00:59:04.239 --> 00:59:07.480 spicy pad tie, steakby Steak, oh Red Bye Steak for sure. 844 00:59:07.639 --> 00:59:13.840 A musician or a favorite musician or band, oh Man, I'm just gonna 845 00:59:13.840 --> 00:59:19.559 say currently eminem logic, Joinner, Lucas, all Kendrick Lamar, all the 846 00:59:19.719 --> 00:59:22.599 real lyricist hip hop artists. By the way, shout out to Captain Youth 847 00:59:22.679 --> 00:59:28.880 and eight. Any my two favorite like bitcoin themed wrappers? Nice? Favorite 848 00:59:28.920 --> 00:59:38.880 movie? Oh Man, Tropic Thunder. Favorite book, um ooh Man, 849 00:59:39.079 --> 00:59:45.639 goodness, gracious love the Red Rising series that's recent though I just read it. 850 00:59:45.679 --> 00:59:51.599 I mean favorite book. Lord, There's a lot Hunter Thompson, any 851 00:59:51.800 --> 00:59:53.840 I have to pick one Hunter S. Thompson, the Doctor, the gonzo 852 00:59:53.960 --> 00:59:58.239 journalist himself, any of them. Fear and Loathing on the Campaign Trail, 853 00:59:59.239 --> 01:00:01.199 any of those books, experien loathing in America, You're and loathing in Las 854 01:00:01.280 --> 01:00:05.880 Vegas. I guess anything hundred Thompson Fear and Loathing. It's my favorite. 855 01:00:06.519 --> 01:00:07.679 And when you're not working a Galaxy, what are you doing for fun? 856 01:00:08.719 --> 01:00:15.000 Hanging out with my kids, making hip hop music and reading nice Alex pleasure, 857 01:00:15.119 --> 01:00:17.639 chatting with you, and I definitely have to have you back on because 858 01:00:17.639 --> 01:00:21.440 you guys at Galaxy are doing so much. You got your pulse on the 859 01:00:21.519 --> 01:00:23.599 market. But thank you so much for joining me. Yeah, Tony, 860 01:00:23.679 --> 01:00:24.239 thank you having me